The year 2011 delivered plenty of volatility and little reward for stock investors. Equity returns were largely inversely related to risk – the smaller in size or more foreign the stock, the worse it performed. It was the same story all year; Europe teetered on the edge of a debt collapse while the U.S. economy teetered on the edge of recession.

Gold is set to deliver an astonishing 11th straight calendar year gain in 2011, a dramatic reversal of an equally astonishing 20-year slide that began in 1980 when the gold bubble collapsed. For 13 of the calendar years between 1981 and 2000, gold was a loser, in contrast to the S&P 500, which rose during 17 of those same 20 years. This stark comparison doesn’t do justice to the real money implications of sharply diverting ways. A thousand dollars invested into the Vanguard 500 Index Fund at the end of 1980 (even without 1980's 30%+ gain) grew to $17,524 by the end of 2000. The same investment in gold crumbled to $465.

As of November 14th, the S&P 500 is down a fraction, but up about 1% if you include dividends. In other words, despite the U.S. debt ceiling battles, euro debt chaos, and slow economic growth blues, investors are still beating money market funds and CDs. Granted, CDs don’t fall nearly 20% in a few weeks, look like they're going to slide another 50%, and then  recover. Such is the new market: low returns, sky-high volatility.

After this long plateau, inflation fears abound, oil prices remain uncomfortably high after skyrocketing a few years before. A global superpower is stuck in a war in Afghanistan, and Iraq is a war zone putting global oil supplies at risk. We have no idea where economic growth will come from, or when it will kick in. The government is a mess. Tax and regulatory uncertainty has business leaders scratching their heads. The unemployment rate, no longer stable at around 5%, seems to be heading toward 10%, and investing in precious metals or the far east appears to be the only way to make any money.