September 27, 2012

Suze Orman Backtracking on Gold

Last year Suze Orman was bullish on gold.    Today she appears to have forgotten her optimistic prediction for golds value and is no longer in favor of buying the shiny metal.    I recently caught an episode of her program where she told a viewer that gold would be the last place to put money behind housing and mutual funds.  

The episode aired Sept. 22nd.  The bit in question is around the 33 minute mark of the video.   The viewer asked "What is a better investment option: house, mutual funds or gold?"

Suze said first "all of those 3 things : fabulous investments over the long run".   Then Suze said that
"gold at this point really would be my last option, I have to tell you the truth".    She did go on to say that she thinks you could / should invest in all 3 assets for the long run in some portion.

Still it seems that gold is not her favorite investment of the three therefore she must assume housing and stocks will perform better than gold.   Yet late last year she was predicting ~20-25% increase in the value of gold within the 12 month period.

Here was her previous prediction which I talked about before

Gold prediction by Suze Orman -- Forecast : $2100 by 11/2012.  

Money reported a tweet from Suze Orman she made in Oct. 2011 where she predicted that gold will be "$2100 by 11/2012"    and recommended having 10% of your portfolio in the shiny stuff.   I found her reiterate the $2100 target on Nov. 10th last year    Gold started the year 2012 about $1600 and hit a high of $1781 in February.    

 Today gold is trading around $1750 an ounce.   If you'd followed Ormans advice and bought gold in Oct. 2011 then you would have paid somewhere between $1617 and $1741.  Depending on when you bought you'd be up 0.5% to 8%.   By comparison in the past 12 months the S&P 500 is up over 20%.

So to sum up :
Suze Orman in Oct. 2011 : predicts $2100 price of gold
Gold hits $1750 in Sept 2012.
Suze Orman in Sept. 2012 says gold "would be my last option" versus housing and stocks.


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