Whatever gold chart you look at that is longer than a year shows you that the value of gold has gone up very fast. Almost too fast to feel comfortable with. The 5 year chart shows it rising from the $600's to a high of around $1,900 before settling in the $1,700 range the current price of gold is now.

What has made it go so high so fast? I think it is mostly fear.

An interesting article by Warren Buffet in Forbes details his view that he would rather invest in profitable businesses, real estate, or farms than gold. His thinking is that at the end of the day, gold is not used for much and demand for it comes from the belief that it will always be in more demand. Fear, in other words.

Gold really does have very few practical uses and other than being made into jewelry, what good is it? It is of little use other than to make things pretty and if the world is truly in chaos, will people really care about the jewelry they are wearing?

So, other than people's perception that gold will always be desired, what is propping it up and making it's value go up so much? It has to be fear that is driving the price up. Fear that paper money will become worthless or severely devalued, fear that real estate will continue it's loss of value, and fear that the stock market is too high and will see another big drop.

Fear and gold go hand in hand and Warren Buffet has made his case that he would rather invest in assets that actually produce something. I don't know whether he is right but I kind of feel the same way. I want to put my money in something that will hopefully grow and produce things which will create more value. But I don't want to miss out on the next upswing of gold prices (if there is one) either.

How do you feel? Is gold actually worth investing in at these levels and does the cost of gold depend on people's fear?