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A few weeks ago, I wrote about the recent peak in gold prices and said that we're never quite sure if we're in a bubble until it's over. Perhaps one of the best signs that we're in a bubble is that people will refuse to acknowledge that we're in a bubble. If that's any indication, the commentors on my post at Seeking Alpha definitely should have clued us in that gold was headed for a big fall.

Bloomberg reports this morning:

Gold may fall for a sixth straight week, the longest slide in four years, as a strengthening dollar erodes the precious metal's appeal as an alternative investment.

Twelve of 21 traders, investors and analysts surveyed from Mumbai to Chicago on Aug. 14 and Aug. 15 advised selling gold, which last week fell to $792.10 an ounce in New York, capping an 8.4 percent drop for the week that was the biggest in 25 years. Eight respondents said to buy, and one was neutral.

Gold, priced in dollars, generally moves in the opposite direction of the U.S. currency. Gold is down as much as 25 percent from a record $1,033.90 reached on March 17. The last time the metal fell for six straight weeks was in May 2004.

If you have some time for a little cheap entertainment, this link will take you to the Yahoo Message board posts for Cisco’s stock on March 27, 2000. That was the highest day for the hottest stock of the era. These posters are so madly in love with their stock it’s almost funny. Absolutely no criticism is allowed. Just look at the posts. They have a religious intensity to them.

To scroll through the posts, just click on the > symbol right by the time stamp.

Posted by edelfenbein at August 18, 2008 11:20 AM