Analysts: Gold rally not a bubble...
From Reuters.com: Gold's 37 percent rise in six months to 25-year highs, far from a price-bubble ready to pop, will continue upwards on renewed fund enthusiasm, analysts said. The bull market may attract even more new money in the coming years, with potential for bigger price spikes, they said. "Like a gorilla with a gun, gold can go anywhere it wants," said Peter Hillyard, head of metals sales, ANZ Investment Bank.
"With the quest for yield, the need for portfolio diversification and the huge appetite funds have for risk, all commodities are certain to rock for a lot longer. It's not a bubble about to burst." Gold prices peaked at $573.30 a troy ounce on Thursday, gaining 11 percent this year on top of an 18 percent rise in 2005. The metal has more than doubled in five years. But analysts say gold has room to go much higher. It is still well off January 1980's all-time high of $850, a level which would now stand at $2,100 after adjusting for inflation….Full article: Source
My thoughts: A little gold is alright in your portfolio but it is very volatile so be cautious!!! You can make a strong case for commodities based on demand from India and China but they can also swing wildly as well.
GG