Is the question "Is price of gold a bubble?" appropriate for skeptics?

My take is that skeptics is both an appropriate place to ask this question, and the best place to ask it of the available SE sites, though I'm open to being persuaded otherwise and I'd be grateful for thoughts and suggestions.

Raskolnikov thoughtfully suggested personal finance (http://money.stackexchange.com) or quantitative finance (http://quant.stackexchange.com). I don't think the gold bubble would properly fit in either because the question not limited to personal finance or quantitative finance. Tempting though it may be to pigeonhole it into one of those topics, I'm skeptical that expertise from either of those fields would result in a an answer of the nature and quality I seek.

I think it's reasonably compelling that the question about gold being a bubble is suitable for Skeptics. From the Skeptics FAQ: "If you have a question about the accuracy of public claims made in the media or elsewhere, if you're interested in the evidence behind what you hear or read, then you are in the right place."

There are many public claims in the media that gold is a bubble, and I'd like to see gold being a bubble proven true through strong, verifiable evidence.

That being said, as Fabian suggested, irrefutable proof might only come after the fact of a burst (or not at all otherwise). However, if people are asserting that there is a bubble, what's the evidence upon which they make this claim? Would it be preferable to edit our gold question so it reads "Is there evidence to support a claim that gold is a bubble?" -- or perhaps more generically "is it possible to predict bubbles in advance of them bursting?"

That being said, I think it's possible (and I'm hopeful) someone could come forward and indicate that gold is (or is not) a bubble because of some evidentiary basis and comparison.

Thanks for reading!

  • Bubbles have been studied by experimental economists in their human subject market laboratories under various conditions -- there is a rich literature on this. See, e.g. georgana.net/sotiris/teach/docs/exp/Lecture6.pdf for a starting point. This is far from proving that any particular present market is a bubble, but a start at understanding how markets sometimes seem to deviate from expectations.
    – Paul
    Commented Apr 16, 2012 at 10:00

3 Answers 3


I agree that the question is time-localized and hard to answer skeptically.

Furthermore, I think that there's an underlying question which is quite interesting:

Are financial bubbles predictable?

Worded like this, the question would be not time-localized and answerable skeptically - someone must have studied the predictive power of macroeconomics...

On the other hand, this is just my interpretation on how the question could be changed into something better - I think it's really up to you whether to keep the question as is.


One problem is that the question is too localized in time. In a few years, we'll know whether the price of gold was on a bubble or not, and the question will be useless. I think it inappropriate on that basis alone.

I'm also not sure this is answerable. Most likely, some people will say "yes, it's a bubble because...." and some will say "no, it isn't a bubble, and you can see that by...." It will likely come down to which economist you want to believe. I could be wrong, and being wrong here could be very interesting.

The "I heard this here, any evidence for or against?" is pretty much the archetypical question, but I personally think it has too many things against it.


I don't think this is a good question because declaring any asset's price as bubbling is subjective, it's only relative to this point in time and speculative.

Also, how can you apply skepticism to this question? What thought or idea are you challenging?

A similar sought of question is "Is the price of petrol very high". Sure it is, but am I being skeptical by answering either way?

Also, just because there isn't a site for a certain question doesn't mean that it should be placed on the next best thing.

A good example of a question is "Is [some claim] causing gold to sit at above average prices?" where [some claim] is something that can be analysed skeptically and not something common like low interest rates.

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