NEW YORK (TheStreet) -- Gold's stunning 9% drop on Monday has many declaring that the yellow metal's 12-year bull run is officially over. In the past year, the price has fallen nearly 16%, and now stands at the lowest level since February 2011. Technicians will tell you that the gold price chart looks downright ugly, and that there may be further damage done in the near future. That may well be true, but my perspective on gold is a bit different.First of all, gold is not an investment, in my view. It's insurance against uncertainty, a hedge against inflation and a store of value. In times when there is little uncertainty, and inflation is not a threat, you would expect the price to be relatively low as it was for much of the late 1990s. As an investor, you'd hope for those conditions, because all in all, it would signal economic stability, rising markets, and solid performance from your portfolio. With gold representing a small piece of that pie, investors would happily accept falling gold prices in exchange for growth in the other asset classes in their portfolios. GLD data by YCharts
However, I don't believe that we are living in times of great certainty. There are many clouds on the horizon, both economic and other world issues. I also don't believe that inflation is at bay. Despite what the CPI tells us, as consumers, we are well aware that we are paying more for many things needed to sustain our lives. Perhaps via mortgage refinancing we've been able to cut our housing costs, but rates won't stay this low, artificially I might add, forever. It's difficult to imagine a scenario in which interest rates don't explode at some point in the next several years. The Fed has been pumping and printing for years, deficits are exploding, and one of the few ways out of this mess will be via inflation.
There's likely to be more volatility in the yellow metal in the near future, but I believe that the case can still be made for the longer term. I would not want to speculate shorter-term, though. And, if we do enter a period of solid economic growth, and little uncertainty, I would not be unhappy to see the price of gold fall. But we are certainly not there yet. At the time of publication the author held was long gold. Follow @JonMHellerCFA This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.