Oh, gold prices may go up again, but investment advisers and regulators are warning investors to be careful about putting too much of their money in gold.As the stock market has vaulted up and down day after day, investors have fled to gold. But have all these investors chasing what they think is a secure investment created a bubble?You bet your glittery gold bullion, says Wells Fargo Private Bank, which manages money for wealthy clients.“We believe that we have reached the point where we can confidently state that interest in gold investing has reached the level of a speculative bubble,” the bank's investment team wrote in a market update issued on August 15. “Prudent investors should be very wary of having substantial investment exposure to this precious metal in their portfolios.”Quickly and with very little warning, the bottom can drop out on gold prices, the report said. During a six-month period in 2008, gold lost more than 30 percent of its value. In the 1980s, in just over two years, the price plummeted about 65 percent.And what do you know, not even a week after Wells Fargo released its market update, a Bloomberg report led with this: “Gold plunged in New York, heading for the biggest drop in 18 months, on speculation that financial markets may be stabilising, eroding the appeal of the precious metal as a haven.”Bullion fell more than five percent in two days of trading last week. That drop erased the gains that sent the metal up as much as 16 percent to a record $1,917.90 an ounce on August 23, according to Bloomberg.“We are seeing the exact same behaviour at the height of the tech bubble, housing bubble and the Japanese Nikkei bubble,” Erik Davidson, deputy chief investment officer for Wells Fargo Private Bank said in an interview. “Excuse the pun, but we are crying out to investors that gold is not a silver bullet. People want to believe there is a sure thing. There is no such thing as a sure thing.”Unlike investing in a stock that pays a dividend or in real estate where you can collect rent, gold has no inherent earnings power, Davidson said. Investors have to hope someone else comes along and pays more than they did. He called that the “greater fool theory.” He points out that when gold hit a record $850 an ounce in January 1980, it took until January 2008 28 years before investors buying at the high broke even.Last week, the North American Securities Administrators Association (NASAA) and Financial Industry Regulatory Authority (FINRA) both issued strong warnings to investors to watch out for gold-related scams. Schemes involving gold and other precious metals made the NASAA's annual top 10 list of financial products and practices that take advantage of investors.“A lot of money is going into gold because people are fearful of other ways of investing,” said NASAA President David Massey.Gerri Walsh, FINRA's vice President for investor education, said, “We were seeing scams increasing that were tied to gold. What frequently happens is con artists pick up on what's in the news.”In one typical con, a promoter gets investors to pony up money for equipment to supposedly reopen a dormant mine. Investors are promised they will get their money back plus interest and a stake in the mine. In another scheme, promoters assure investors they have access to gold coins or nuggets that they can safely store or trade with the added promise of high profits.This month, the founder of Florida-based Global Bullion Exchange pleaded guilty to fraud charges in a scheme involving more than 1,400 investors who lost $29.5 million, according to FINRA. Investors were led to believe that they were buying interest in precious metal bullion. Investigators determined that no bullion was ever purchased.Walsh said says investors should be cautious about claims that tie a gold company's stock to the rise in gold prices and about scare tactics that gold is the safest bet against inflation or an economic meltdown in the US or Europe.It's the fear of economic armageddon that is driving up gold prices, Davidson said. “If you're really worried about the world ending, buy peanut butter and beef jerky,” he joked.But seriously, investors need to curb their enthusiasm, he said. Gold is not going to climb in perpetuity. “We are not saying take your gold investment to zero, but certainly this is not the time to jump on the bandwagon.”Readers can write to Michelle Singletary c/o The Washington Post, 1150 15th St., N.W., Washington, D.C. 20071. Her email address is singletarym@washpost.com. Comments and questions are welcome, but due to the volume of mail, personal responses may not be possible. Please also note comments or questions may be used in a future column, with the writer's name, unless a specific request to do otherwise is indicated.(c) 2011, Washington Post Writers Group