Two things caught our eye this morning.

"HOUSE PRICES SLUMP," says a cover from last week's Daily Express. English property prices have been drifting downward for several months. So far, the slippage has been modest. Few people are fearful; most expect a gentle decline, followed by a rebound.

A real estate agent in Maryland noted last week, too, that the market had "gone soft" there all of a sudden. But for the moment, no one seems very worried about it.

As near as we can tell, investors are still panicking into real estate. If they're afraid at all, it is fear of missing an opportunity that drives them on.

We notice, too, that some of the biggest stocks on Wall Street have taken huge beatings. Fannie Mae has lost half its capital value...Microsoft, too. Wal-Mart, once at $70, is now down to $43. But are stock market investors fearful? Are mutual fund investors worried about getting wiped out?

No...not yet. The Dow is still well over 10,000. Stock buyers are still taking up shares at more than 20 times earnings. If they are worried or disappointed with stocks, they move into real estate, where returns have been bigger and surer.

If they were really concerned, they'd buy gold. And yes, somebody is buying gold. The price has risen nicely in the last few years. An ounce now trades at $470 or so, a 17-year high.

Which brings us to Conrad de Aenlle's article in the International Herald Tribune. "Like generals fighting the last war," he says, advisors are urging their clients to buy gold. We don't know exactly what war or what generals Aenlle refers to. The struggle for the last five years or so has been only to get as much in real estate assets...in the hottest areas...as possible. Any general who fought that war by loading up on gold would probably get latrine duty. Yet, Aenlle thinks gold's bull market has reached a peak.

"There have been few occasions in modern times when buying and holding it, instead of owning stocks, was a good idea. And those instances only occurred when gold was lurking on the edge of town, not parading down investment's Main Street to public adoration."

Again, the man must be watching a different parade. The clowns we see are still buying houses and stocks - not gold. The price of the yellow metal, while at a 17-year high in nominal terms, is still far below the $850 price it hit in 1979 dollars, and even further below its inflation-adjusted high of about $1500 (in 2005 dollars).

In 1980 you could have bought every stock on the Dow for a single ounce of gold. Today, you will need 22 ounces. And in 1980, you could have bought a typical suburban house for only less than 200 ounces of gold. Today, if you want to exchange gold for a house you'd better have about 700 ounces, or about 2,000 ounces if you are in California.

No, gold has not yet gotten into the parade. It is still on the wrong side of town...still putting on its funny hats.

*** This morning, we awoke early. Uncharacteristically and unflatteringly, we were worrying about money.

A man believes what he has to believe when he has to believe it, we keep saying. When he has no money, he believes that it is perfectly OK to live in the poor part of town and drive a used car. When he is flush, he believes that living in the poor part of town is no longer good enough for him. He has to find ways to get rid of his money, so he comes to believe that he should go out to dinner more often, buy a nicer automobile and up-grade his life.

There is no law that says he has to believe these things. A few people are able to resist. Warren Buffett, for example, lives in the same modest house in Omaha he bought many years. But Buffett's wife, now deceased, left for San Francisco and the lure of good works. Buffett stayed in Omaha with his housekeeper.

Your editor is skeptical about the value of money. He can take it or leave it, he tells himself. But he has a large family whose members are often less skeptical than he. And his very indifference to money seems to work against frugality.

"Since it makes no difference to you," says another member of the family, "we might as well spend."

Little by little the expenses build up. We have three children in college. Now, we must maintain residences in two of the most expensive cities in the world. We earn far more than we did 10 years ago; still, we find ourselves saving as little today as we did then. The rest of the money is used up...here, there, and everywhere.

We bring this up not to complain or lament, but to illustrate two points. First, no matter how much you make...it is very easy for costs to rise to meet, and even exceed, your income. Second, no matter how relaxed you are about it, there comes a moment, usually in the dark of night, when a nagging fear creeps upon you, like a sewer rate on a gutter bum, and you decide you must straighten up.

*** "Hurricane's damage to oil rigs unprecedented," says an A.P. headline.

A friend of ours in the oil business adds:

"I have some good news and some bad news. The bad news is that Rita passed directly over our production in Panola County, Texas. Panola County is on the border with Louisiana. Our pipeline company shut down the pipeline last Friday and our wells had to be shut in as a result.
 
"The good news is that we did not have any damage and the Thomas well was returned to production yesterday and the Chadwick and Keeling wells will be returned to production today.

The current price for natural gas is $14.33, the highest in history. Unbelievable."

*** We are still thinking about Argentina. Here in London, a decent steak dinner with wine costs at least $40. In Buenos Aires, it was barely $5. Here in London, we pay $10,000 a month to live in a tarted-up garage. In Buenos Aires, we could live in a luxury apartment overlooking one of the city's finest boulevards for only $1,500 a month. Here in London, a typical apartment in South Kensington will cost you $2 million. Out in the wilds of Argentina, that amount of money will buy you a half-dozen houses, and enough land to put down all of London...and more.

Everything regresses to the mean: Sell London. Buy Buenos Aires.

Bill Bonner is the President of Agora Publishing.  For more on Bill Bonner, visit The Daily Reckoning.