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Precious Metals: Time for Fear, Not Greed

Precious metals make sense as part of a long-term portfolio allocation, but today's prices are not offering an attractive entry point, says Bill Bernstein.

Benz: I also want to touch on metals, which has been another big mania for investors. Gold in particular recently has come back down a little bit. But I'd like your take on precious metals as a component of investors' portfolios. Are you a believer or a naysayer?

Bernstein: I believe that in the long term precious metals should be part of most everyone's allocation. But once again, Buffett's maxim applies here, which is you want to fearful when others are greedy and greedy when others are fearful. If you are buying gold right now, you are probably buying it from someone who paid $300 an ounce for it in 1984, and so you are probably the patsy at the table if you're doing that.