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<p>[QUOTE=&quot;fatima, post: 1294340, member: 22143&quot;]It seems to me they call them bubbles because the demand for the item is being driven by the expectation of getting rich with little effort and little risk rather than free market demand and ability for the economy to support.&nbsp; It&#039;s an unreasonable &quot;mindset&quot; about an asset without regard for the facts.&nbsp; &nbsp; </p><p><br /></p><p>I don&#039;t think this describes the current physical market in PMs.&nbsp;&nbsp; The small time physical PM buyers are buying because they see what is taking place with the traditional forms of 20th century investing that are unraveling in the 21st.&nbsp; I think some big investors and very quietly non-western governments are also stocking up on the metal because they know what is coming.&nbsp; However the vast majority of the population is still selling PMs which isn&#039;t the hallmark of a bubble.&nbsp; There are gold selling parties like there used to be Tupperware parties.&nbsp; Remember, as I said above,&nbsp; bubbles are created by a &quot;mindset&quot; and that mindset isn&#039;t there with the majority of people when it comes to PMs.&nbsp; There are still huge disincentives to owning PMs in the USA.&nbsp; </p><p><br /></p><p>I don&#039;t think bubble describes what happened in the 1980s with gold.&nbsp; In the late 1970s most of the depression era controls over the finance industry were still in place.&nbsp; There had been excessive government spending related to 3 wars, Vietnam, Cambodia &amp; Laos (sound familiar?), disastrous wage &amp; price controls&nbsp; and of course all sorts of new regulations and vast expansion of the welfare state.&nbsp;&nbsp; Because of this spending Federal Reserve was forced to raise interest rates to historic highs, exceeding 16%.&nbsp; In response people simply sold off their gold.&nbsp; When you can make 10% - 14% just by having money sit in a safe insured bank account, there is no reason to hold bullion.&nbsp; </p><p><br /></p><p>(The point here BTW, is you can&#039;t simply look at price charts and declare &quot;it&#039;s a bubble&quot;.)</p><p>--------------</p><p><br /></p><p>My advice to anyone who thinks that PMs are in a bubble is this.&nbsp; Take whatever you are using as a bubble measuring stick and apply that measuring stick to the stock market.[/QUOTE]</p><p><br /></p>

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