I'm going to have to apologise before I start. I'm not a professional investor, don't play stock markets and don't understand many of the terms used in the gold threads here.
However, I am virtually certain in my own mind that a huge recession/depression is coming very soon, and have little confidence in the strength of the pound or the stock market. I have read through the Gold River website and it seems to me that gold is a good bet. I even think that there may be a huge surge in gold prices in the future.

My position is probably trivial compared to most on this thread/forum, but I'd really appreciate your views.
I have 35k sitting in a building society account from a recently aborted house sale. I'd like to do something with it rather than watch it rot as the pound devalues.

I'm prepared to invest (and also prepared to lose entirely) £5k ("big deal !" you may say) in gold and would not be looking for short term gains as I don't expect to buy a house for about 3-4 years. I don't really want to invest in mining companies, as I am not sophisticated enough to judge their future. Gold is gold however and as long as I don't have to keep it in a safe at home, I'd prefer to buy the metal, and this seems a good time to buy.

I know this is a finger in the air, you don't give financial advice, and I'm not going to sue if it goes tits up. I just want your view. I make my own decisions, but like to get as much info as possible, particularly from the more sophisticated investors here.

So the questions are :

What is your view on the return i might get on that 5k investment in say 2008/9? Do you expect a bubble, mediocre returns or a loss?
If the value of the pound decreases through inflation, am I right in thinking that will just increase the £ value of my gold, and so I am therefore protected?
Is it in anyway possible (however unlikely) that I could lose ALL my £5k?

Apology again for taking up your time with a question which may be found by an evening of reading threads.
I just want a simple answer.

You're in the same position as myself, though I've recently bought 500 gbp's worth (wow) of Barrick Gold (worlds biggest gold mining co) shares which have now increased by a massive £30. My plan is to either buy physical gold or shares in Barrick in batches of £500 every 2 or 3 months, rather than sinking all £5,000 in one go and hoping for the best which should hopefully protect me from the worst excesses of the stock market, gold price and exchange rates (but means if gold shoots up in the future I won't make as much)
This is the only way I could sell it to myself - if my £500 had gone to £470 after the first 2 weeks then I wouldn't be too worried, if my £5,000 had gone down to £4,700 I would be really concerned, might have sold up and missed out on my original (and your) idea that gold is a good bet for the medium term.
In answer to your questions :
"What is your view on the return i might get on that 5k investment in say 2008/9? Do you expect a bubble, mediocre returns or a loss?" - I expect gold to gradually creep up as things get worse, how much ask dr bubb
If the value of the pound decreases through inflation, am I right in thinking that will just increase the £ value of my gold, and so I am therefore protected? Gold is a safe heaven in times of high inflation
Is it in anyway possible (however unlikely) that I could lose ALL my £5k? Very unlikely unless someone perfects alchemy

I must say that the 'gold bull' web pages fill me with a little suspicion as I guess they're trying to talk up the market, but again, I donlt think I'm going to loose that much and it is more interesting than putting the money in ING

I think you need to do more of your own research before you invest in it, either that or find a good financial planner that knows about the economy - most financial advisors don't have a clue.

try reading the books, the dollar crisis and why its great for your investments and the empire of debt (just ordered this)