Titled:     Gold hits new highs

Has anyone else hitched themselves to the gold wagon? Vastly underpriced, underproduced, oversold and underappreciated, gold and silver are producing healthy returns. Disregarded as mere speculation, rather than investment, because it pays no interest, makes no profits and never IPOs, gold nevertheless has intrinsic value lacking in paper fiat money.

Usually gold and the dollar are inversely linked - when the dollar gets stronger, the price of gold drops. A little while back, that relationship was broken, and both the dollar and gold started to climb together. Why this is important is that when the dollar falls, gold will probably still rise.

China is pushing its citizens to buy gold. Russia has announced it will double its gold holdings. India's middle-class is sucking up gold like there was no more left. Even Germany, having spent many years trying to carefully sell its gold has announced it will start to buy again.

Unlike paper money you can't just make more when you need it. When Bernanke starts launching the helicopters of money, the value of the dollar will slide, leaving gold as the only sure hedge against inflation. The current plan for Iran to start a euro-denomiated oil bourse is yet another sign that the dollar's day as world currency is slipping.

It is well worth stashing away a few gold bullion coins, such as the gold eagle, and some silver, as a rainy day fund just in case the gubmint has a fit and the dollar goes pear-shaped.

Of course please do you own due diligence. One useful starting place is the Mogambo Guru, probably the most amusing financial columnist on the planet.