In principle, holding gold is a form of insurance against war, financial Armageddon, and wholesale currency debasement. And, from the onset of the global financial crisis, the price of gold has often been portrayed as a barometer of global economic insecurity. In fact, the case for or against gold has not changed all that much since 2010 - it makes perfect sense to hold a small percentage of your assets in gold as a hedge against extreme events. As Ken Rogoff explains, the recent collapse of gold prices has not really changed the case for investing in it one way or the other. Yes, prices could easily fall below $1,000; but, then again, they might rise; but he warns, policymakers should be cautious in interpreting the plunge in gold prices as a vote of confidence in their performance.