I trust that besides the sweaters, socks, shirts, and scarves under your tree, you found something bright and glittery, like say some gold stock certificates. Let me tell you, gold is hot right now. Now, I am not advising you to run right out and buy gold (although I did earlier this year) but rather to keep certain things in perspective that may not be realized all too often.

Gold raced to its highest price in nearly six years last week as increasing fears of war in Iraq lured investors to the precious metal. You have to consider that usually a haven in times of trouble, gold has soared around 25 percent this year alone, triggered by fears of conflict in the Middle East, a weaker dollar, falling equity markets, and rising oil prices. You could say that these all contributed to making it one of the best performing financial assets.

According to a metals analyst at UBS Warburg, gold is on fire because at this time we're dealing with fears and liquidity and therefore, there is an enormous appetite out there as alternative investment opportunities begin to wane. In fact, at one point in hectic Asian trading last Thursday, spot gold surged more than $13 above New York's late price to reach $353.75 an ounce, the highest it has been since March 1997. In effect, gold is roaring toward year's end with a 23 percent gain.

"The dollar looking set to trade lower, the threat of terror attacks in the U.S.

and UK, and the possibility of another Gulf War will make the market very nervous for the next few months and give the yellow metal the potential to make further gains," reports James Moore, metals analyst at TheBulliondesk.com. "I think $355 will be some kind of resistance level, but above that there is clear water till around $420."

When searching for the cause for gold's dramatic comeback, most experts point to the usual suspects, especially a weakening dollar which they claim is being dragged down by the current account and federal budget deficits. Also, with low interest rates and a slumping stock market, foreign investors aren't that interested in buying greenbacks.

Of course, as I previously mentioned, throw in fears about terrorism, a second Gulf War, plus rising oil prices triggered by unrest in Venezuela, and you have the recipe for rising gold prices.

The move into gold has occurred as the dollar fell to three-year lows

against the Euro and as oil prices surged above $30 a barrel to three-month

highs along with a strike crippling the Venezuelan oil industry. It should be noted that rising oil prices are an early indication of looming inflation, which also attracts investors to gold as an alternative to stocks and cash.

Take another look under that tree. Anybody get a gold bracelet?

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