1) Gold Doesn’t Throw Off Earnings
The major misconception here is that gold competes with stocks, which are often measured by earnings. Gold is more of an alternative to cash, not stocks, but if you want to talk about stocks, they are also difficult to value, since quarterly earnings are subject to a wide variety of usually-wrong guesses by analysts. Stocks constantly disappoint or surprise analysts on the upside or downside. It is difficult to predict any stock’s future performance. And you can also make the “no earnings” argument about America’s most widely-held investment, a home. There is no formula for evaluating the right price for a piece of real estate. Does that mean we should not own real estate?