Follow Rajiv and watch his videos on Facebook and Twitter.

Rajiv Patel is economic attaché at the Embassy of India in Berne and business columnist for Swiss Radio and Television. He has a degree in finance from the University of Delhi and does management consultancy for large corporations worldwide. He enjoys cricket, sudoku and love songs.

Is gold a good bet?

Dear Rajiv,

I've heard gold is a good bet. What do you think?

Vincent K., Hong Kong

I've heard zebras can fly and your auntie has a beard. Vincent, do you really believe every silly thing you hear? Gold has been on a downward spiral for over a year now. As we move forward, it is quite obvious that more and more people will say gold is likely to go up again eventually. It does not take a rocket scientist to make such predictions: a chimpanzee would do just as well.

Gold hit an all-time high of 1900 dollars per ounce in September 2011. Now it is about 1300 dollars: that’s a 30 % fall in prices. Back in 2011, I remember listening to Marc Faber, Peter Schiff and a few other poster boys of the finance world ramble on about how gold was a good investment. They said gold has intrinsic value: if there’s a big rumble in your part of the world, you can stuff it in your sock and run. Someone, somewhere, will always be happy to buy it from you again.

Now let me tell you something about intrinsic value. Gold has intrinsic value if you are a dentist, because you can fill holes in a tooth. Gold has intrinsic value if you make electronic devices, because it is an efficient conductor. But for people like you and me, buying gold is simply a way of dreaming about getting rich, so we can spend the rest of our lives in Hawaii sipping margaritas with hula dancers in coconut bras. It is like buying bitcoins, Twitter stock, or a stuffed shark by Damien Hirst. Gold is basically a lottery ticket.

So, is gold going back uphill? Will India win the Cricket World Cup again in 2015? What are the winning numbers for next week’s EuroMillions Lotto? If I knew, I would not be waking up every morning at 7 am, going to work on public transport and writing miserable columns for beer money. Think about that the next time you see some guy on TV looking very serious in his suit and tie while he is talking about the stock markets. That guy does not actually know. He just gives silly answers to silly questions. For more than beer money, presumably.

Follow Rajiv and watch his videos on Facebook and Twitter.

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