In the latter years of the 1970's there was the confluence of a post-Vietnam War world awash in money and a global economy that was, comparatively speaking, not creating value or gains in productivity that could sop up that cash. What happened in markets at that point was an extreme Bull cycle for commodities, collectibles, real estate, and penny stocks " not unlike what is happening today.

But the key difference is that the 1970's represented an extreme inflation cycle, and the 1980's and 1990's has been an extreme dis-inflation cycle. This decade is swinging back to an inflation cycle, but inflation as bad as it might get will not return to the days of 1980. At that point, central bankers in many countries had to raise their rates so high that any party needing an overnight loan was effectively bankrupt.

At that point in 1980, there was no outlet for the pressures in the financial system due to excessive money. So collectibles like antiques, racehorses, fine art, diamonds, gold and jewelry, etc, came into play. In another century, it was tulips that reflected the mania caused by people having too much money and a shortage of economic assets in which to deploy that money.

That's not the case today.

Today there are investment grade opportunities all over the world. Instant communications and trade settlement and clearing systems, harmonization of laws and rules and regulations across borders, increased global travel, knowledge and understanding, and so forth, have made the world a much smaller place today. Opportunities abound.

Just think what would happen if there were fewer Osama bin Laden's and people so willing to establish their own power and control over others. Cross-border trade, commerce and investment would expand at such a rate that good management and good business models would flourish on a grand scale.

In that case, gold would simply become money " not something to be horded. One's assets would be fully allocated to economic production where cash on cash returns would simply make hording Gold as silly as hording USD or Yen or Yuan.

So please don't tell me about $2200 1980 inflation-equivalent Gold. Yes, China and India are buyers. Yes, securitization of the bullion commodity is making buyers of people like you and me. But, no, 1980 was a different time " very much unlike today's environment.

Hairdressers and barbers are telling me (my literary license at work here, so please indulge me) that the public buzz about precious metals will take the price much higher. On top of a relatively strong global economy that is now benefiting from new economic engines in the form of China and India, all traded commodities (oil, all the metals, forest products, and so forth) are enjoying a bull cycle; the precious metals are enjoying a solid run up in price.

But commodity prices are not recession-proof, and the world has never before avoided recessions in the business cycle. So the commodity price cycle will some day come to an end.

I suspect that when it does, we in North America will not have to endure 20 percent interest rates, and so forth. This time, the credit bubble will burst long before that happens.

So where do I think the cycle peak will be for Gold? Well, it's rainy and overcast today, so my crystal ball is not working well. But I seem to recall that I previously called an intermediate cycle top (2006) of about $625, and a final move to between $700 and $1000, possibly in 2007) before Gold starts to trade like money again.

When will Gold reach that peak? As I see it, the top will happen over a period of weeks and months when the owners of capital come to the realization that there truly are economic opportunities somewhere in the world that warrant taking the risk.

Now that's not going to help the day traders do their set ups today, but then again the market noise today is going to be mostly over the U.S. Jobs Report, and I have been killing time till I figure out what traders want to do with that.

With higher than expected job numbers (+233,000) and a lower unemployment rate (4.7 pct), the reaction is so far very positive (equity futures are very strong, particularly the oils due to Nigeria issues again).

I suppose the Gnomes could have put out an inflation scare following the Jobs Report (and the Nigeria oil problems), but then they have a lot of bonds to move out before they take Gold higher.