A bubble is not a bubble if everyone thinks it is.  Call this "Herb's Law of Silly Experts". Simply, if a bunch of experts call a rise in the price of a certain asset a "bubble" and if the press latches on to this as obviously true, it almost certainly is not! 

Why do I think this?  Because I am a capitalist and understand free markets in a way that no professor or so-called expert does.  I understand that markets are efficient and collectively wise.  The price of a particular asset or investment is determined solely by supply and demand and these are affected by how much people really want something and how available that something is.  After all, the definition of "What is an economy?" is the system by which society distributes limited supplies of just about everything.  The only things in life that are free, namely air pretty much, are free because there is an unlimited supply of it easily available to all.  But add in any sort of difficulty in producing or supplying something, even water, and a cost becomes attached to it driven by, yes, supply and demand or "How much of this stuff is available and how much do you want it?"

I share this short economics lesson to understand why real estate was a bubble that finally burst, while gold is not.  Put on your thinking caps and think back to when real estate was red hot.  Nobody, and I mean nobody in the mainstream of economics or business from Wall Street to Main Street, to Washington, to the Federal Reserve defined what was happening as a bubble. Everyone pretty much thought all was well until it wasn't and those that did warn of the bubble were thought of publicly by the mainstream as kind of nutty.  When the prices crashed and the whole thing came unraveled - it was largely by surprise.

Contrast this with the current price of gold.  It is at $1248 per ounce as I write this, an all time high in unadjusted dollars.  I say "unadjusted" because if we adjust the current dollar for inflation since the last time it hit an all time high in 1981 it would take $2300 per ounce to be at a real all time high.  The thing is that you need only turn on CNBC or Bloomberg or Fox Business for a few minutes any day of the week to find some expert or analyst who says gold prices are a bubble that will soon burst.  Commentators eagerly chime agreement. So how are they all missing this?

Their very careers and a lifetime of experience make it near impossible to believe that things have really changed from what they have always been used to.  They believe in the religious sense of the word that things will get better because they always have and have to.  Therefore, now is the time to invest in stocks and bonds and get ready for the inevitable recovery.  The thing is that the recovery exists only in statistics of some experts as the real economy continues to drag.  Meanwhile, world governments continue to print make believe paper money with nothing behind it on the same assumption that the economy will grow enough to absorb all this excess paper.  When it doesn't, and it isn't, we are all going to witness the shock of the experts at how a meltdown of the proportion that is coming could happen.

Back to gold, if this were a bubble no one would see it.  People would be throwing money at it with abandon, the price would be zooming through the roof every day, and the case would be made by the experts that there are fundamental and solid reasons for the rise in price.  Instead we are told it IS a bubble, which is based upon nothing, and we should avoid buying at these prices.

I am telling you that the very popular denial of the value of gold is why the current price is nowhere near a bubble.  In fact I go along with Peter Schiff, New York Times bestselling author, Senate Candidate in New York, and President of Euro-Pacific Capital (an investment firm with whom I have no connection whatsoever for the record) who predicts that gold will rise to over $5000 per ounce.  I think that is actually a reasonable estimate.  No kidding.

So now is the time to build up cash, put it into gold or gold mutual funds or stocks, and let the process unfold.  Even in a Depression folks get rich.  I plan to make one of those folks you.  All you have to do is think out of the box, be willing to go where others don't, and reap the riches!