The following comment has 18 up votes:
Gold is really not a good investment. – Almo (source)
What's the deal with it? Is investing in gold bars equally bad as investing in gold jewellery?
If you buy a gold brick and put it in a pillow, after one year you still have one gold brick. People may value it more than before or less then before, but it's still the one gold brick you had.
If you buy a cow and put it on a pasture, after one year you have a fatter cow and plenty of milk. You now have more of the cow and milk you didn't have before. Now that's an investment.
I think what the person meant to say is that Gold is not a one stop solution. There's nothing wrong with having Gold in an otherwise diversified portfolio but you need to be aware about the potential downsides:
The problem with gold is that its value nowadays depends mainly on investor confidence, or the lack of it (actual demand for gold cannot explain the rise in value gold had after the crisis). If people are afraid the world and currencies with it will go to hell, the gold price will go up. Why? Because if currencies seize to exist, Gold will still be accepted. It can replace currencies.
What many people tend to forget: let's consider the extreme example and currencies really cease to exist and all hell breaks lose. What good are gold bars at the bank, or even at home, for that matter? You'll be better off with gold coins to use in barter and to pay off marauders. But that's not about investing anymore, that's survivalism.