Gold is Still Not Able to Provide Useful Investment Opportunities to Personal Investors

Gold Price from 1975-2012

Investing in gold is one of the most difficult things do simply because it defies most of the laws of sound investing, in that it is one of the least predictable commodities that can be invested in. In the last decade gold prices have been increasing at a staggering rate with the price of gold increasing more than five times to what it once was. However before this more recent increase it had been consistently decreasing in value for 20 years. Researchers have come up with certain characteristics to help understand what effects the price of gold, however due its extremely fickle nature these still do not provide any usable baseline to be able to predict what will happen. Gold is thought of as one of the safer investment opportunities available along with treasury notes, which are bonds backed by the government, and due to its astronomical rise more investors are beginning to turn to it. However gold has many negative drawbacks and as a result it does not provide the personal investor much room in long term growth.

The Price of Gold Can Be Very Volatile

Although, it is very difficult to predict what gold will do there are still some signs to help understand its behavior. Gold as stated before is usually a more defensive or safer investment. Most investing experts believe that gold is a better bet than stocks in a recessing economy or in times of high inflation. Xiahui Gao a Visiting Assistant Professor of Finance at the University of Maryland explains what she believes controls gold prices.
However historically during golds price increase from about $300 an ounce to what its currently trading at around $1700 an ounce the inflation rate was low and for most of the decade decreasing. In addition more recently in the last two years gold has decreased almost $200/ounce but inflation has been increasing and we've been in a recession. At the simplest level, gold's price is purely based around supply and demand, so really price fluctuations should be based around investor psychology more than anything else. As much as investors would like to see gold continue to rise at the rate it has been, there is really no sure way to make any prediction on its price because its mostly based on how you think people will act. 

Gold is too Expensive for the Personal Investor

The biggest drawback of gold is also whats made it very attractive as an investment recently, that being it's price. Gold has skyrocketed to over $1700 dollars an ounce, and at the very least a gold contract will require an investor to by about 25 ounces of gold. Meaning in order to invest in gold you have to place an initial investment of over $42,000 at the very least, which also does not include the cost to store and protect your investment. For this very reason many people have turned to ETF's or exchange traded funds instead of physically buying gold. ETF's are essentially funds that you can invest in which are backed by the price of gold. So instead of physically buying on gold you are essentially betting that the price of gold will go up which will increase the trading price of the ETF. These ETF's have some positives in that they are usually priced by the gram so the average investor can afford them. In addition they are safer in nature because you are not encumbered by the burden of storing physical gold. ETF's still face the same challenges of unpredictable gold price fluctuations, and are taxed much higher than physical gold meaning the returns on investment are still not very positive in nature.

The Public Perception of Gold Still Remains Fairly Poor

Most people still do not view gold as a viable investment opportunity and as a result its public perception is only marginally better than what it once was a decade ago. Gold is still looked down upon as investment for those who believe the worst is yet to come. When asked if he would invest in gold, a University of Maryland freshman was fairly adamant about not wanting to put his money into gold.

listen to ‘UMD Student's Opinion on Investing in Gold’ on Audioboo

Gold usually increases as the dollar gets weaker so in the long term our economy will not stay recessed for an extended period of time most likely. As a result if gold perception loses traction in the public, the demand for gold will drop and historically gold can drop drastically just as fast as it can increase. Gold at it's best can provide some insurance in shaky economic times, but what it won't provide is long term opportunity for a growing investment. The best gold investment you can make is purchasing jewelry for a loved one rather than  making it a cornerstone of your investment portfolio.

 

Non-Experts Take on Investing in Gold

listen to ‘Citizens take on investing in gold’ on Audioboo

Investing in Gold

The Midas Touch: Is Gold Worth Investing In?

Gold's Track Record

Research shows that for the most part in the last 100 years gold hasn't provided a completely steady investment. It usually has bursts of growth but for the most part it hasn't shown extremely high level of return on investment. However in the past Gold has usually mirrored the price of other commodities, such as oil. With oil prices gold could be a good investment however that is just one factor out of many which is why I choose to research this topic more in depth. 

The Value of Gold: Why is it Important?

I had basic knowledge on the subject however I wanted to delve further into the subject to see what factors influenced gold and if it would be a good investment in our current times today. Being in a recession had led for the most part low return on most traditional investments in the stock market. I wanted to look into more unique methods of investing money to see if there were still efficient ways to increase your personal wealth, which as a business student is of pretty large importance to me. 

Gold is a Good Bet

I would start this section with basic research about the positive aspects of Gold which got me interested in the subject. Discussing how gold doesn't get taxed in Maryland and how Gold is fairly steady and doesn't have too much volatility. Then depending on what info I get from my expert on whether or not Gold is a good bet I would talk about why you should or shouldn't invest in Gold. If i get a negative response I would start the section with facts about why Gold is a bad investment instead of a good one.

The Public's Perception of Gold

I would start with articles I found with people talking about how they felt about Gold and use there quotes. Then I would embed audioboo's I got from non experts talking about whether or not they would invest in gold and how they felt about it. 

Topic Idea

listen to ‘UMD Students Viewpoint on Blended Classes’ on Audioboo

listen to ‘Students Opinion on Purchasing an iPad’ on Audioboo

Studying the Usability of iPads: How Easy is it?

Background Information on the Testing

Researchers at the Nielsen group decided to test the usability of iPads for new users and see what issues  arose when using the device. They tested 7 subjects between the ages of 20-50, 3 were males and the rest females. The study being done was a traditional usability study were participants essentially voiced their thoughts throughout. Three of studies were conducted in Fremont, CA and the other four were done in Chicago, IL. All of the participants had used iPhones thoroughly in the past, however all but one had little to no experience with an iPad in the past. The tests were done with a researcher nearby and each participant was directed to first, simply start using the iPad and explore it using any app's they were interested in. Then they would be directed to use specific apps and were told to do specific tasks. For example when using the ABC Player app the subjects were directed to find a specific episode of lost, or find what would be playing on TV later that night. Throughout this entire process researchers would ask the subjects what they were unhappy with or what they felt were design flaws. Each of these sessions would go on for 90 minutes and was recorded with a camera.

The Overall Findings of the Study

The major findings from this study were characterized by many of the subjects feeling that certain designs just felt like scaled up versions of an iPhones when a more efficient design could have been used.  One of these findings was dealing with the four button tab bar at the bottom of the iPad. It's the same design as in the iPhone however users felt that due to the large screen size of the iPad theses buttons often got lost and were rarely used. In addition, whereas on iPhones most users would choose to use apps rather than use websites, users of the iPad's were flipped. Most felt a lack of continuity in iPad apps as well as a lack of change from their iPhone counterparts made it more efficient to simply use web browsers.  However the biggest problem that arose with this is what the researched coined Read-Tap Asymmetry or essentially when text is big enough to read to small to tap without zooming. This often happened because the mobile version of websites would be to simply in nature for the iPad, however the regular website would be too zoomed down causing this issue.

The Problem with Apps

One thing I found particularly interesting in the study was the findings on the inconsistencies in the design of iPad specific apps. There are about 700,000 apps for the iPhone however, iPad specific apps are still fairly new with only about 200,000. As a result there are a lot of discrepancies between app designs and for users this presents a big problem. For example on four different apps double tapping a picture resulted in it either getting larger, hyperlinking to a new page, flipping to a new picture, opening a navigation bar, or having nothing happen. Another example of confusing graphical interfaces would be in the swipe motions associated with iPads. On many apps swiping left takes you for example to the next page of the article, whereas on other apps swiping left takes you to a entirely different article.


Another finding was a problem that often arose when maps were included on pages of apps or websites. On the Stanford University website there is a page with a map of the university on it. When users tried to zoom in on the map using the well known multi-touch gesture of pinching the entire web page zoomed instead of just the map retracting greatly from the usability function of the website. Finally  one of this biggest complaints was the vast differences between apps and their website counterparts. For example with both the eBay and Gap app many items did not show up when searched for. In addition there were less choices for specialization when searching for exact products, when iPad when searched in the eBay app many off topic items showed up such as cases and accessories. These misconceptions are also compounded by the fact that many apps have hidden usability functions that are not readily apparent to the user. With so many differences between apps on the iPad it makes usability very confusing.

The Importance of the Findings

This study shows a definite lack of "keeping up with the technology" on the part of app designers. There is a large discrepancy in the usability of many apps in relation to the technology the iPad possesses. A lot of popular apps are simply reusing their tried and trued iPhone app designs on the iPad which is resulting in a lot of confusing app designs. Designers need to realize that the iPad offers a new spectrum of design possibilities in addition to the fact that they need to simply need to redesign simple things like font sizes and spacing to make it easier to read text and select items. Finally, there needs to be some type of unification of gestures and actions to make it less confusing on the user front and make the iPad more user friendly and overall just more efficient. I think this study did a very good job in showing that there are definite graphical interface design flaws in the iPad that need to be fixed. 

Mind The Gap: Mobile Devices in Politics

Looking at differences between the digital divide and participation gap

Although both the digital divide and participation gaps are problems in an always evolving technological world, I believe currently in the U.S, we are far more influenced by the latter, that being participatory gaps. The digital divide focuses more on the inequality of ownership of internet ready devices whereas the participation gap bases it's theory around the fact that there are discrepancies with the comfort level and ability people have with different technologies. However the participation gap is a direct result of the digital divide. In my mind about 4 years ago there was a clear digital divide, and although we may have been able to bridge the inequality for the most part as a result of less experience a participation gap is now clearly evident. 

Voter data is helping to show a decrease in the digital divide

Guidry utilizes the examples of a lack of computer ownership in minorities specifically Latino's and African Americans as well as illustrating the point that close to a third of college students still don't have a personal computer. However, this data is somewhat dated and according to more recent findings done by the Pew Research Center on mobile data and politics I would be more inclined to say that America has evolved from the digital divide and is now facing a participatory gap. The data which polled over a 1000 voters of different political and demographic backgrounds came back with a findings that 88% of voters had a cellphone of some sort and about 50% had smartphones. In fact democratic voters who usually include more of the minority had a higher percentage of smartphone ownership that those affiliated with the republican party.

American voters help illustrate participatory gaps in American smartphone users

The biggest differences in the study where seen when the data was broken down into different demographics which showed that the those aged 18-49 and those who had received college educations were both more likely to use their smartphone for election related uses out of all voters who had smartphones. To me this illustrates that there is a clear difference in the ease of use of technology. A younger audience and those who have received  college educations have probably had more interaction with these technologies and as a result also use them in ways past their basic uses that someone less technologically proficient would not be able to. 

What's in store for the future

If the market for mobile devices continues the way it currently is then we could see the digital divide almost disappearing completely resulting in a shortening of the participation gap. As technology continues to improve there are more and more smartphones that are becoming cheaper in fact most large carriers have internet ready phones free when you get a contract. Currently these smartphones are becoming more accessible and in the next 3 to 5 years if more and more people have access to these devices the participation gap should being to shrink. Overall I think we can expect to see a tangible increase in mobile audiences across america in the coming years.    

Facebook Passwords: Sharing isn't Caring

In the last couple of years with the boom of social media employers have been able to expand their horizons when performing checks on your background. With services such as Facebook and Twitter an employer can see what you do in your personal life in a matter of clicks.

 However now that this has become commonplace more potential employees are taking actions to strengthen their privacy and maintain a clear separation between their personal and professional lives. Much to the dismay of more and more employers have begun to demand employee's to befriend HR reps and take down privacy settings, or in some more extreme cases even demand the password to there social networks. I could not even believe that this was even legal but also a commonplace throughout the country. Employers were essentially making you choose between your right to privacy and your livelihood. 

What's scary about this push by employers to know more and more information about you, is that daily we give these websites more and more information about ourselves. Utilities like Google and Facebook have grown due to their convenience. We store almost all of our daily lives in these sites, our friends, our contacts, our pictures, our locations. It's crazy to think that these sites more information on us than ever and now employers are forcing you to give them complete access to them. In addition due to the harsh job climate we are facing for many families it the choice between having food on the table or being able to stand up for your rights.  

In a recent case the Maryland Department of Corrections asked an employee for his Facebook password to verify that an extended leave of absence was actually due to a death in his family. Orin Kerr a George Washington University professor summed it up saying, "it would be akin to asking someone the keys to their house." Luckily as a result of this Maryland Legislatures passed a bill prohibiting employers from asking you for your password. In addition other states such as Illinois have followed suit. What still shocks me is that in Facebook's terms of service its clearly stated that the site forbids, "anyone from soliciting the login information or accessing an account belonging to someone else." Hopefully more states will follow Maryland's lead and being to crack down on employers. The last thing employee's should have to choose between is job security and Facebook security.