After years of "who cares?" status, gold is very much back on the investment map. Even ordinary investors are talking about the run-up in gold prices to a 22-year high.

That's good news for those who bought in at low prices five years ago. But is it a troubling sign for the world economy?

That's the question some investors are asking after gold topped $500 an ounce last week. Gold is considered a safe investment, so its price rises when financial uncertainty grows. Gold prices can spike amid war, high inflation, or depression.

But this year's run-up in gold doesn't mean the proverbial sky is falling, many analysts say. Rather, the simultaneous peaks in gold, real estate, and stocks are a sign of extraordinary circumstances in the economy and financial markets.

By most measures, the world economy is now healthy, posting solid growth without signs of runaway inflation. And consumer spending isn't letting up. Just consider all those shoppers braving the predawn chill to get cut-rate computers and other discounted goods at Wal-Mart the day after Thanksgiving.

But it's still a time when many investors are looking for more insurance - exactly the role that gold has traditionally played. Even if risks such as inflation don't materialize, some analysts see reasons gold could keep on rising well beyond the $500 per ounce price achieved last week.

Investors are taking notice.

"I'm starting to get phone calls now [about gold]," says William Bernstein, author of "The Four Pillars of Investing." "That ought to tell you something."

The near-frenzy of recent interest, indeed, means that investors could just as easily lose money as make it by investing in precious metals in the weeks ahead.

"It helps to buy low and sell high ... which is probably not what you're going to be doing if you buy gold right now," Mr. Bernstein says.

Gold has been rediscovered for a number of reasons, analysts say:

• Central banks, especially in Asia, are buying to diversify their reserves beyond dollars and euros.

• Concern about inflation has risen in recent years along with energy prices and US government budget deficits.

• Investors globally have "excess liquidity," lots of cash, driving up the price of virtually every asset, including gold.

• In addition to rising demand from investors, demand for gold has been rising for use in jewelry and as a status symbol in prospering Asian nations.

• Supplies may be tight. "Net new mining supply out of places like South Africa is running at its lowest level in 80 years," according to economic research by Merrill Lynch, a financial management company.

All this follows years when gold was arguably underpriced. In the 1990s, its value fell below $300 an ounce as stock markets soared and inflation ebbed.

"It's an asset class that has done so poorly for so long that it was bound to revert to its fair value," Bernstein says. "It's insurance against an inflationary scenario that does bad things to stock and bond portfolios."

For now, inflation appears to be the least of the rationales for a gold rally. Although the era of $1-a-gallon gasoline is just a memory now, rising energy prices haven't yet rippled persistently into broader inflation. The so-called core inflation rate, excluding food and energy, has stayed near 2 percent annualized. That's where it was in 1999 when gold was at a low of about $250 an ounce.

"I don't believe we are going into a period of material inflation," says Dennis Gartman, editor of The Gartman Letter on investing in Suffolk, Va.

Nor does he see other risks worsening in the global economy. "I think the war effort in Iraq is quickly coming to fruition with an election in two weeks.... The Chinese are more interested in getting rich than they are in waving Mao's red book."

But Mr. Gartman remains bullish on gold over the long term for another reason - buying by central banks.

The price of gold was long an explicit backstop for the value of paper currencies. Central banks still hold gold as part of their reserves, but many have been sellers of the metal over the years since the official US gold standard ended in 1971. But now, some central banks are buying gold.

Gartman is leery of buying at $500 an ounce, however. He would rather buy when the price weakens to about $460. He says an efficient way for investors to get their stake in gold is through exchange traded funds, such as the one with GLD as its ticker symbol. One hundred shares will track the value of one-tenth of an ounce of the metal.

Bernstein favors buying gold mining stocks, such as through mutual funds. He says those stocks tend to do better than gold at outpacing inflation over time.

Advisers generally say only a small portion of an investment portfolio - zero to at most 10 percent - should go into precious metal. Gold may be an insurance policy, but it also gives investors a bumpy ride along the way.

Commentary:
Rising gold prices almost always means investors fear inflation.

Gold hit a 17-year high in September, 2005.

Sept. 20 (Bloomberg) -- Gold rose for the fifth straight day as a surge in energy prices renewed concern the pace of inflation may accelerate.

"Speculators continued to buy on the back of inflationary worries and uncertainty about the U.S. economy," Darren Heathcote, head of trading at N.M. Rothschild & Sons (Australia) Ltd., said in a report e-mailed today.