The gold price soared to yet another record high early Wednesday, surging as much as $11.50 to $1,672.80 per ounce before backing off to trade just under the $1,665 level. The price of gold has gained $165, or 11%, since the end of the second quarter, bolstered by a slew of soft economic data in the U.S.
I was reading this this morning and thought what a risk buying gold is. Today it is high but six months from now it could be back to $300 an ounce, like it was 2002. From my experience buying stock in gold mines is also a loser as the price of gold has little to do with the stock market value of gold mines and I won't go into the tax issues with any "dividends" they pay out.
But speaking of gold mining I was recently reading about gold mines in Maryland. No, I am not referring to the "fool's gold" often found near Pennsylvania Avenue in DC but actual mines. Out around Rockville, Gaithersburg and the Great Falls area there were a number of gold mines. The Black hill Mine, the national Gold mine, the Guilloy Mine, the Grady Mine, the Bethesda mine and the Ford Mine. These were active in the 1870 to 1930 period. Once gold was fixed by the US Government at $20.67 per ounce these operations became unprofitable In 1934 the price was increased to $35 an ounce and production started back up for a few years.
Today it is mostly amateur gold miner panning and digging in the area.