By NELSON D. SCHWARTZ

It is the resurgent passion of the doomsday crowd, a bet that everything will go wrong. No matter what has you worried, they say, the answer is gold.

Inflation, deflation, government borrowing or the plunging euro - you name it - the specter of these concerns has set off a dash to gold, driving the precious metal to new highs and illustrating how fears of economic turmoil have moved from the fringe to the mainstream.

And gold bugs, often dismissed as crackpots who hoard gold bars in the basement, are finally having their day.

“I just think you’re in a world where a lot of chickens are coming home to roost,” said John Hathaway, manager of the Tocqueville Gold fund. “Gold is an escape hatch.”

The United States Mint is running short of gold coins, and the South African mint increased Krugerrand production by 50 percent late last month, to its highest level in 25 years, on brisk European demand.

The debt crisis in Europe and the ensuing drop in the value of the euro are the most recent catalysts for gold’s recent spike to $1,254 an ounce, a record before adjusting for inflation, but the deeper concern is that even in the United States, government borrowing is unsustainable and the day of reckoning is at hand. Sales of American Eagle oneounce gold coins tripled in May from the month before.

If governments print more money to pay off their debts, the logic goes, inflation will destroy the value of the dollar, the euro and other paper currencies - thus enhancing the value of gold. What is more, with tax increases unlikely and with Europe on the brink, the unthinkable - a sovereign debt default or the collapse of the credit system - has suddenly become thinkable.

To be sure, gold buyers have always been motivated by fear. What has changed is that some of the most respected investors on Wall Street are now among the fearful.

“In recent years, we have gone from one bubble and bailout to the next,” David Einhorn, a New York money manager who was among the first to foretell the failure of Lehman Brothers, said in a speech last month. “Our gold position reflects our concern that our fiscal and monetary policies are not sufficiently geared toward heading off a possible crisis.”

Since ancient times, gold has been deemed intrinsically valuable, holding its worth even as governments fell and currencies collapsed, while seemingly casting a spell on its owners.

Still, gold can go down - sometimes sharply. After peaking in 1980 at more than $800 an ounce, gold sank over the next two decades, bottoming out at just over $250 an ounce in 1999. But unlike paper assets that can become worthless, gold always retains at least some value.

Even as worries about the global economy have intensified, gold has become easier to buy.

Although some people still regard bars of gold in a vault as the ultimate insurance policy, exchange-traded funds, or E.T.F.’s, that hold gold have exploded in popularity in recent years. Gold E.T.F.’s, which trade like stocks but track the price of physical gold, account for 1,684 metric tons of gold, up from less than 500 metric tons in 2005, according to Credit Suisse.

Daniel J. Arbess, who manages more than $2 billion in Perella Weinberg’s Xerion fund, is a new gold lover. A few years ago, he said, he would not have taken a second look at gold as an investment. But now Mr. Arbess, a Harvard Law graduate and a generally conservative investor, is very serious about gold.

Spiraling deficits in the United States, Japan and Britain are unsustainable, he said, and could eventually hurt confidence in what are called “fiat currencies” - paper money not backed by gold, including the United States dollar.

“Indebted countries may soon be forced to choose among three politically difficult alternatives: sharp cuts in expenditures, debt default or printing money to pay off debt,” he said, with the last option the most likely outcome. Gold, he said, is a logical hedge against this risk, because firing up the printing presses ignites inflation.

For all its newfound respectability, gold still manages to bring out the inner survivalist in its adherents. Mr. Hathaway, the gold fund manager, says the credit system has entered “the end game.”

“People probably still think I’m nuts,” Mr. Hathaway said. “But I’m not talking to myself in an isolation chamber anymore. We’ve got company now.”


Even respected investors are turning to gold, though its value has dropped sharply at times. / LEONHARD FOEGER/REUTERS