Monday, Apr 20, 2009
Inflation and gold.
Telegraph: Gold price could hit $1,500
The aggressive monetary policy of central banks around the world is playing havoc with the structure of the bullion market, creating a chronic shortage of gold that may soon push the metal to fresh records above $1,500 an ounce.
Posted by flintster1994 @ 09:16 AM (2143 views) Add Comment
58 Comments
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1. penbat1 said...
Gold bugs have been saying this for a long time. It will happen just as long as there is an inflationary phase in the future.
2. mountain goat said...
The article writes "There are already reports that gold bars are becoming scarce, partly due to fears that futures contracts and other forms of paper gold may not prove reliable if there is a serious break-down in the global financial system."
Here is a report on this I found. I would love to see the whole COMEX paper gambling market get crushed when they run out of gold. There is clearly a big demand for physical gold, just walking through the mall this weekend the jewelers have big signs wanting to buy jewelry. Similarly try google "gold" and see what ads show up. All signs there is a big premium to be had on physical gold, and perhaps more cynically, gold moving out of the hands of poorer people towards the rich.
3. sold 2 rent 1 said...
Armstrong has now penned 16 documents.
http://www.scribd.com/people/documents/10432015-kris
The best 2 are
http://www.scribd.com/doc/13999839/Its-Just-Time-Martin-Armstrong
http://www.scribd.com/doc/13999736/We-Are-Alone-121808
The "We Are Alone" one, when you really study it, is telling us loads about gold.
Gold is lining up with the Armstrong turning points (see page 7 and the list of turning dates)
We had a turning point on 14 Nov 2008 (gold low on 12 Nov 2008) and another on 21 Feb 2009 (gold high on 20 Feb 2009).
19 April 2009 may not be the low point for gold as we may have further to correct. There is another turning point on 7 May 2009 which could well be final gold low before the major Elliott wave series begins.
If you miss this entry point then late September will be the final chance to get in before the real madness begins as we go into Calleman’s sixth night
When the financial system collapses it will be fast and all preparations must be done well in advance.
Get prepared now
4. crunchy said...
Historically gold @ $1,500 is realistic.
5. paul said...
Ambrose has gold interests himself, so although he can't 'talk up' gold in the article he writes that there 'may be frenetic activity soon'.
I'd be happy to be proven wrong, but I'm still not convinced. Gold is a paper money hedge but also an expensive luxury. Its role as a hedge is therefore nowhere near as clear cut as it might appear to those in US/Europe who can afford to invest.
6. denzil said...
Yawn! Been hearing this for so long it's now become boring.
7. str 2007 said...
S2R1
I didn't see any major news yesterday ( but given it was a Sunday, I guess fair to assume there wasn't likely to be any).
What are your recommendations for advance preparations of a financial collapse ?
(Does make you wonder if those with houses mortgaged or not might do best in the case of a total collapse)
Crunchy
$1500 for Gold being realistic.
How would you expect it to fair in Sterling terms though ?
Hyperthetically I suppose of the dollar was he next currency to devalue by 30% gaianst all others Gold at $1500/oz would perhaps not effect the current £19,000/ Kilo sterling rate by much ?
8. bellwether said...
As bank stocks plummeted and the security of our financial system looked precarious in a way that would have been unimaginable even 2 years ago, it was really surprising how little the gold price reacted to that. It becomes worth wondering what would be needed to drive the price up.
9. mountain goat said...
This is worth a read with respect to a financial collapse. Starts off with evidence that China has stopped buying Treasuries (and is clearly going on a spending spree to diversify out of USD reserves). Their main point is that in the US taxes get paid in April. Tax revenues will have collapsed because of the downturn. So the US financial collapse starts soon.
10. Mr Rigsby said...
Gold at $850 an ounce in 1980.....now $871.50
Didn't it do well!
11. str 2007 said...
Hi Bellwether
I know a few weeks ago you were short on Gold.
Did you manage to stay in?
And are you still of the same opinion ?
12. uncle tom said...
The more people 'talk up' the prospects for gold, the less convincing it becomes. Maybe I've been around too long, but you have to remember that when someone tries hard to make you buy something, it's because they don't want it anymore.
Throughout all the hand-wringing over the current economic crisis, one word is notably absent. Gold. No-one gives a monkeys anymore about soveriegn gold reserves, yet there are still thousands of tons of the stuff sitting in central bank vaults.
- Reserves that cash-strapped nations no longer need..
13. tudorian said...
mountain goat @ 9
Thanks for the link.
This is (if correct) wholly predictable and also a worrying next stage in this 'depression'
Any relationship between a vendor and a 'best' customer will eventually breakdown when the customer overspends and can no longer afford to pay for its goods. What happens next though?? China has to act aggressively to increase domestic demand for its products. Whats the point in producing when there are no buyers? Will Chinese manufacturing be next to implode?
14. sold 2 rent 1 said...
str 2007,
Both the Calleman and Armstrong models show 16 April 2010 as the date of peak destruction.
There is strong resonance with the peak oil price of $39 from Feb 1981 and also with the 9/11 false flag operation.
Also the peak oil price in July 2008 had strong resonance with the 1945 Japan A-bombs.
So we can expect it to be a pretty awful time. GB has to call an election by May 2010 so will we have the mother of false flag ops to cancel the election and have marshal law instead? And like false flag 7/7, will London be the target? And will it be a dirty bomb?
If the Euro crashes in March 2010 then the USD and GBP will get a short term gain.
If you have made enough money in gold/silver before 16 April 2010 and you live far enough from London (say 70 miles) then buying before 16 April 2010 could be a good plan, else I would wait until May 2010 to see what pans out.
15. Tennouji said...
@ # 11 I agree.
Remember in the final days of HPI there were stories of how the average house "Will cost ￡1,000,000 by 2015" dutifully reported by the
VI press.
When the man down the pub talks about gold, well......
16. bellwether said...
Hi STR 2007, good to hear from you.
Closed the short a fortnight or so ago as the price seemed to be recoverying from lows that were from recollection about $860, also wasn't sure if the inflation story that is driving up equities might also drive up gold - I'm out on whether gold is mostly a hedge against crisis or a protection against inflation although suspect its a bit of both and sometimes neither.
Think there will be an opportunity to short again if price breaks down much from where it is now.
Generally not invested in much. Think this rally is artificial being a relief reaction to selling in jan and feb and a unfounded believe that the financial crisis is over and the banks are offering value. It took me a longtime but now feel that is not the case and we will see this rally break down and equities form new lows- although next phase will be stocks trending for a while.
Sorry going beyond the question, guess because I haven't posted for a while!
17. bellwether said...
UT note as well that China seems to have been buying copper and other metals with industrial application. It has not apparently been buying gold.
18. sold 2 rent 1 said...
As change is 20 times faster than in the 1970s, the gold mania that took place between 1970-1980 will be condensed to September 2009-March 2010.
19. uncle tom said...
Bellwether,
Indeed, and as you said earlier, the price reaction to the economic crisis was very subdued.
Looking at the way gold is being hyped, and looking at the price graphs over the last five years, my guess is that many people who got into gold expected the price to sail clean past $1,000. Now that has failed to happen, my guess is that a $1,000 tag would provoke a flood of sales.
However, smart investors know not to set their selling points at nice round numbers, and now that gold has failed to deliver, I suspect many will be ready of offload at $950.
If Darling's Budget includes a promise to flog the UK's remaining stockpile, their will probably be a rush to sell at any price..
20. sold 2 rent 1 said...
UT,
"If Darling's Budget includes a promise to flog the UK's remaining stockpile, their will probably be a rush to sell at any price"
If so, this could be the final correction that is needed to flush out those weak hands and set up a new bull upleg.
As I said earlier the real gold mania doesn't start until late September where we have an unbelievable buying opp.
21. matt_the_hat said...
16. bellwether - the only reason China needs gold is to buy copper etc, why pay the commission on Gold?
Lets keep a finger on reality, money only buys peoples time, its a store of labour, China has Labour in abundance what it doesn't have is raw materials and expertise (highly educated workforce), once these loopholes are closed and that is what they are trying to do (stakes in Rio, stakes in drug companies and observe any research department in UK universities at the number of Chinese students) the dormant viruses in everything from the electrical grid to the financial system will be activated - the sleeping dragon will awaken!
22. dj2000 said...
This may well happen but for us GBP savers where will it move for us, with the currency changes who knows. I wouldn't mind the price of gold going up though :)
23. mountain goat said...
Crisis over then UT? It was all caused by that misguided Basel II legislation that caused the credit crunch? Now that mark to market has been withdrawn again we can all go back to how things were? I think there is a lot of optism that the crisis is over. Read a view that 2000 was the bubble, 2007 was the deadcat bounce and now the worst excesses have been purged. I do think markets have more upside from here and soon banks will start believing it themselves and housing market will get a bounce too through the summer. Nicely set up for crunch 3 later.
@Tudorian, who knows how China will pull though? At least they are not broke though, just suffering from over-capacity. China is now the world's number one gold producer, so perhaps there are more important things to be buying now with their toxic USD reserves.
24. bellwether said...
MG agree that the crisis is not over but the belief that it might be is everywhere. Barclays hit about £2.40 today 5 x its march low. Credible bank analysts and there are only a few seem to see banks are incredibly overvalued at present eg a price target of £.46 on Barclays by Societe General.
It is the banks that are leading this rally and it will falter on the banks. I'd suggest there are already signs with us markets reacting less and less to the apparent profits of US banks. Watch reaction to BAC today which will of course say it was in profit, I suspect it will be only a little bit postivie and possibly negative - compare reaction 5 weeks ago to Wells Fargo press release on profitabilty.
The profits are of course just a function of capital injections and overvaluation of assets previously worth next to nothing as marked to market, the announcements probably a precursor to attempts to raise capital following the banks "passing" the stress tests.
25. general congreve said...
Mr Rigsby @10 - The fact that gold is only marginally above its all time 1980's NOMINAL high, despite almost 3 decades of inflation and the biggest global financial disaster in the world unfolding as we speak, is what makes the scenario so bullish for gold. Although gold is priced slightly higher in NOMINAL terms than in 1980, in real terms gold is now massively below it's peak historic price. The 1980's high of $850 adjusted for inflation would be equal to approx $2200 per ounce in 2009.
S2R1 - Completely with you, I am sure gold is going to up at some point very aggressively and probably quite suddenly in/over the next couple of years. Can't say I put to much stock in the Armstrong model etc. as models fitted to past events can never certainly predict the future, especially in a world as complex as ours. That said, the fundamentals are all set up for a gold break out, no doubt about that.
I am now a self-confessed gold bug. However, I'd never looked twice at the stuff until November last year. Having a background in economics, having witnessed what is unfolding in the world economy and having read a lot of material on the subjects involving the current financial situation is what switched me onto gold. The fact remains that even with the recent price dip, it is still more expensive to buy (certainly in terms of Krugerands) at this point than it was at the end of last November. And it looks like the worm may have turned for the better as of this morning.
Gordon of Gold?
26. penbat1 said...
Someone convince me why investing in gold should be any better than investing in oil or agricultural commodities ?
27. bellwether said...
General Congreve it's possible but under what circumstances do you see gold appreciating to such an extent?
As an aside those bullish on gold often refer to the 1980 peak as if it was only at that precise point that gold was properly priced. This seems unconvincing. Also the high was so short lived and unstable that I generally see it as a reason to be bearish rather than bullish on gold as an investement
28. general congreve said...
Penbat @27 - "Someone convince me why investing in gold should be any better than investing in oil or agricultural commodities ?"
Oil and grain are two commodities that I would say would be an important part of an investment portfolio right now, providing you have sufficient investment capital. However, the only way to invest in these commodities as far as I'm aware for the likes of you and me is through an Exchange Traded Fund. That's not so difficult in itself, but these ETFs are supplied by banks and the financial community. If the bank your ETF money is invested with goes bang (and I still think this could happen as there's a lot we're not being told) your investment goes bang with it. The govt. might cover people's account deposits, but they're not going to refund lost investment money as far as I know.
Therefore, before you get involved in these commodities through ETFs, getting your hands on something that is solid, that you can keep secure at a location of your choice and that you can actually hold in your hand, and so have 100% control over, is what makes PHYSICAL gold a good bet. No bank or economic collapse is going to take it away from you. Not to mention the bullish outlook for it as far as I'm concerned, which is largely coupled with the risk of further collapses in the fundamentals of global finance as they currently stand.
29. stillthinking said...
When you read books written in the period of the gold standard, with global money backed by gold, up to around 1930, the value of the coins mentioned doesn't seem to be as high as even current prices. Look at Sherlock Holmes, written originally as a newspaper column story, or Roald Dahl's autobiographical "Boy", when he gets a golden sovereign because his tooth has come out (no his family weren't -that- rich).
Basically the value of a coin then doesn't seem appropriate to the price now. Also I think given the economics of the war and post-war period to look at the purchasing parity of gold you need to look before the war. Thinking about the 1970s as some reliable indication ignores the fact that the gold price was dictated for reconstruction purposes. Post-war volatility leading to the US default is not a reliable consistent measurement.
It is apparent to all that not only the UK economy, but the global economy is shrinking.
Amount of gold the same, economy shrinking. Or (economy/gold) is shrinking. There is more gold per unit of economy as time goes on...So there is no real gain to be had, presumably the thinking is that you lose less with gold than with money.
All of this is speculation and gambling.
30. general congreve said...
Bellwether @ 27 - "As an aside those bullish on gold often refer to the 1980 peak as if it was only at that precise point that gold was properly priced. This seems unconvincing."
A very valid point, it would be erronous to assume that it's all time peak price was it's true price and that it should ultimately return to, that is certainly not where I'm coming from.
My take on the situation is that gold hit that peak as a result of the 1970's recession, before things started to stabilise under Volcker and Thatcher came in and gave the US and UK the hard medicine needed to get their economies back in track, at which point gold started to trend back down as people left it behind as a safehaven.
At the moment we are at the beginning, IMO, of a situation that will be far worse than what was experienced in the 1970's in terms of recession. Just look at the number of empty shops in your local high street if you want some confirmation on that. Couple that with an insolvent financial sector and a stupidly over indebted US and UK and the outlook looks exceptionally grim. Therefore I think gold can only go up as a safehaven investment in the future, until such time as we get politicians that are prepared to act in the interests of thier country, rather than the interests of the banking sector or themselves.
31. matt_the_hat said...
26. penbat1 -
1. Transportation - you have a good chance of taking possession and carrying (literally) all your wealth wherever you want to go.
2. Longevity - gold doesn't go off
3. Liquidity - how many pawn shops take barrels of oil.
4. Not useful in industry - Adam Smith requirement for a store of value.
32. general congreve said...
stillthinking @29 - Yes, my position is partly speculative as well as partly safehaven. The thinking being that as more people go into gold as a safehaven the price will be pushed up further, so there's the speculative/investment element too.
As to the value of gold pre-1930's, I have read that since the US decoupled the dollar from gold in 1970's at $35 per ounce, they have printed so many dollars that, even accounting for all gold mined since then, if you went back to a gold standard based on the supply of dollars to gold then you would be looking at at least $45,000 to the ounce!
The US got out of the gold standard, so they could boost there economy thorough unhindered money expansion. It's just that the fiat system they created is now coming to the end of it's life-cycle with debt exploding. Typically a fiat system lasts no more than 40 years, we are approaching that point.
33. sold 2 rent 1 said...
UT,
"Darling's Budget includes a promise to flog the UK's remaining stockpile, their will probably be a rush to sell at any price.."
Also, look at the last time the B of E sold off gold; there was a short term dip followed by an Elliott 5 wave series bull run that ended March 2008
This, my friend, is what will happen again.
34. general congreve said...
SRR1 @33 - Yep, if Darling sells the gold it will at worst cause a temporary dip before lending a big leg up to the price IMO.
Also from a patriotic point of view, if Darling does flog the rest of our gold then he should be publicly dragged through the streets and hung, drawn and quartered for treason.
35. mountain goat said...
Penbat1 - I asked myself that question 14 months ago and decided to split between gold and agriculture. Gold certainly doing better for me at the moment. I completely agree with General Congreve with regard the counter-party risk of ETF's in which I too am invested. In fact AIG is involved with these futures markets and all of my ETFs froze last September. Physical gold is more about insurance against systemic risk. That said currently some precious metal investors suggest selling gold for silver at the moment, which is what I am doing. The price ratio gold/silver is historically very high at the moment.
Stillthinking - I think most gold bugs do look further back than 1970s. The demonetisation of gold and silver around 1920 (driven mainly by GB and Europe because it was only after the WW that the USA was the undisputed financial super-power) was arguably the cause of the Great Depression as paper money went mad. The arguement is not really about price but viability of a debt based fiat money system that unfairly favours lenders and borrowers and therefore destroys the capital base as a result. Capitalism can only survive with sound money in my opinion. I don't agree that buying gold is gambling. Leaving your money in insolvent banks at negative interest rates is more of a gamble. In addition your savings are leant out at ridiculous multiples to fuel one bubble after another, so you contribute to this unsustainable economic model, gambling with your children's future.
36. general congreve said...
MG @ 35 - Yes, I recommend having a bit of silver too. Be warned that while you can get gold bars and Krugerrands at a spread of 7.5%, i.e. you incur and immediate 7.5% loss were you to sell back immediately (therefore you have to be bullish to buy), silver, even if you buy in kilo's has huge margin's on it, approx 30%, a 15% margin over paper silver price. Dealers have factored in that the real availability and demand for silver don't correlate with the paper price. You'll find there's a 3 week wait for delivery in most cases as well.
That said, all of the above are bullish indicators and silver is historically underpriced, on paper at least, and it's a much cheaper punt than gold.
To disclose I am 50% in sterling (for want of knowing what else to do with it - don't trust ETF or would buy oil), 45% in gold and 5% in silver. I am at the advantage that I own my own house, so I can afford to stick my neck out a bit, but then, as Mountain Goat alludes to, if leaving your money in an insolvent bank isn't sticking your neck out, I don't know what is.
37. general congreve said...
Correction @ 36. Said silver had a 30% margin. I meant to say 30% spread and 15% margin (approx).
38. general congreve said...
Tennouji @ 15 - "When the man down the pub talks about gold, well......"
Exactly, that's when they'll be a bubble. 60% of the public in the west are invested in the stock market, either directly or through a pension fund. Only 2% own gold. Gold bubble? I think not.
39. str 2007 said...
general congeve to bellwether
''Just look at the number of empty shops in your local high street if you want some confirmation on that.''
Giving that actual statement a bit of thought, the High Street is a very different place to what it once was.
Alot of small high streets are made up of shops selling luxuries and non essentials. It has always amazed me some of these shops survived in the good times, never mind the bad.
Not even many Estate Agents have gone bust and they must have had it harder than most High Street shops.
What I'm saying is I'm thinking the High Street is as good an indicator as perhaps BTL flats in Liverpool as an example.
Tesco/Asda turnover/profits would offer perhaps a better indication.
It's fascinating to think though what our High Streets might look like in 10 years time. And what may fill the empty spaces.
40. debtfree said...
Why would anyone want to swap gold or silver for a debt based piece of paper is crazy. Who cares how many dollars you think would buy my ounce of gold, not interested. You can have your funny money. I'll just hold enough cash to buy food and pay a few bills thanks.
Even if I swapped the gold for some cash to buy a property, legally speaking, it would not belong to me as the title deeds would belong to the person, i.e persona of me. Even those who have paid your mortgage off don't actually own the property, all you've done is paid off the debt of the persona. If you owned the property the government wouldn't be able to tax you when you purchase. They can only tax the persona to which the title deeds are attached. Bit like DVLA, you are the registered KEEPER. The car doesn't belong to you, it belongs to them and you have agreed to the rules of the contract and must now pay tax on the vehicle.
Holding gold means you are a sovereign individual and you do not answer to the law when it comes to your wealth.
IMO , that alone is worth more than $1500 an ounce.
41. general congreve said...
str2007 @39 - A good point. I for one shop online (mainly cos I'm a bloke as well as it's cheaper), so perhaps the high street is no longer the foremost indicator of the health of the economy. Although I would argue Asda/Tesco profits would be a skewed indicator too, as firstly even in a recession food is the last thing people stop buying and secondly they're at the cheaper end of the food market so in a recession their profits may well increase.
I think the best indicator of the economy, all things being equal, is tax revenue. And alledgely Brown and Darling are looking at a huge shortfall in that, no surprises there.
Debtfree @ 40 - With you on the fact that you can't really put a paper price on gold in the current economic climate, if it does go up significantly though I will liquidise a portion of my gold and put the cash very sharpish into other assets I am eying up, i.e. a new mad max-style landrover for overland adventures - travel is my passion. Will also double up as a post-apocalyptic home ;)
42. general congreve said...
Oh yes, gold on a bullish spurt today, is this the beginning of what we've been waiting?
My position disclosure: http://www.rathergood.com/bullion
43. paranoia blue said...
We often hear that gold is a hedge against inflation. That is partly correct, and we will see great devaluation of fiat currencies, globally. However, more specifically, gold is actually a safe haven against incompetent “glubbermint” of which we have experience much, and sadly, there is more to come!
44. debtfree said...
@41 general congreve
I think the best indicator of the economy, all things being equal, is tax revenue. And alledgely Brown and Darling are looking at a huge shortfall in that, no surprises there.
What happens when people wake up to the fact the don't have to pay taxes ?
Tax Laws are under Admiralty Law which covers many commercial activities, although land based or occurring wholly on land, that are maritime in character.
Human beings are land based and your rights come under common law.
Nowhere does is state in common law that you must pay taxes !!
Why do you think a court hearing for a parking ticket or council tax fine doesn't have a jury ?
In Magistrates' Court, there is no jury of ordinary people, the magistrates (or judges) make the decisions. These are judges of admiralty law, law of the water.
The defendant has to say if they are 'guilty' or 'not guilty'. - the truth is, once you step in court and say yes i am , then you enter in agreement of contract under admiralty law. BUT, you are not obliged too, this is your right under common law. You have been tricked from birth with a birth certificate and NI number. The name in this type of court is your fictitious name, persona, doesn't exist, only on paper. These type of courts need you to say yes, that's me. Conned, duped.
For the most serious crimes, like murder, the defendant has to go to the Crown Court. This is common law. The reason you have to have a jury is because under common law you have injured someone and therefore must be put to trial in front of the people of the land.
I'm never going to pay another tv license, tax demand or speed camera penalty notice again.
45. general congreve said...
Debt free @44 Looks like we're going a bit off topic here. I merely said tax revenues would be a good indicator of the state of the economy, I wasn't questioning the legality of tax law.
That said, your point is interesting an interesting one. Although I wouldn't count on it working at a court hearing. Have you used this so-called loop hole to get off the hook for speed penalties etc.?
As I understand it you arguemnt is you can go to court over a fine or something similarly unimportant, say that you do not enter into contract and they have to dismiss the case by law. Is that correct?
46. str 2007 said...
Can anyone say why Gold has actually gone up today, I'm failing to see any 'particular' reason other than S2R1's prediction of 19/04/09.
Well done BTW if it continues S2R1.
47. general congreve said...
str 2007 @46 - Like you I'm sceptical of the Armstrong turning point being 100% correct for 19/04/09, it's only a model after all. But there's definitely a growing global awareness that despite all the rampers, MSM nonsense and the recent bear market rally (with the consequential dip in gold), we are far from out of the woods, we have barely entered into them in fact. Be prepared for more gold strength in the coming days and weeks.
48. general congreve said...
Up 2% so far today, that's what I like to see :)
49. paranoia blue said...
No. 46
...'"gash" economic news, and outlook!" ATB
50. str 2007 said...
paranoia blue
What ?
51. sold 2 rent 1 said...
Don't get your hopes up that gold has bottomed.
I think it has further to fall and I like Armstrong's 7 May 2009 as a gold turning point.
52. sold 2 rent 1 said...
Before any big upleg happens in gold small weak hands must be flushed out of the system
This article has many answers
http://www.scribd.com/doc/13999736/We-Are-Alone-121808
53. str 2007 said...
S2R1
I'm surprised to hear the prediction of potential further falls from you.
I had a quick look through the Armstrong post, couldn't see a particular reference to 7th May 2009.
What surprised me today was the sharpness of the upturn against no particular news.
A number of delegates walked out of a speech by the Iranian leader and that was afer Gold started to move up.
I'm struggling to see what has changed from the last couple of weeks when we've seen the Sterling price of Gold moving down.
54. sold 2 rent 1 said...
str2007
The "We Are Alone" one, when you really study it, is telling us loads about gold.
http://www.scribd.com/doc/13999736/We-Are-Alone-121808
See the long list of dates to the right of the chart on page 7
Gold is lining up with the Armstrong turning points (see page 7 and the list of turning dates)
We had a turning point on 14 Nov 2008 (gold low on 12 Nov 2008) and another on 21 Feb 2009 (gold high on 20 Feb 2009).
19 April 2009 may not be the low point for gold as we may have further to correct. There is another turning point on 7 May 2009 (2009.348) which could well be final gold low before the major Elliott wave series begins.
Too many gold analysts are short term bearish at the moment.
55. mountain goat said...
Str 2007 - just my opinion on the gold price. For the past month or more gold has been acting like a safe haven, stocks down gold up, stocks up gold down. So today is no exception. Traders just switching in and out. The other thing that makes me think todays 2% move is not about anything systemic is that silver's response has been muted, only 2% up as well. Silver tends to double gold moves up or down when there are big moves.
S2R1 you have approached things from a different perspective but I agree that gold probably has more downside in the coming month. My view is because I don't believe the bear rally is over. There is a lot of bailout money sloshing around and through probably devious means banks have reported fairly good results. They were relieved of mark to market rules just a few weeks ago conveniently. You say weak hands need to get flushed out of gold but weak hands need to get flushed out of the stocks bear market too. Everyone has a trigger finger on the short for the moment this bear rally ends. No sure things in the market place and shorts are going to lose money for a while.
56. mountain goat said...
How to sell your scrap gold, you need to try hard to get more than 25% of its value! http://www.stockhouse.com/Columnists/2009/April/18/Turning-your-gold-bling-into-ka-ching
57. quiet guy said...
@str2007
"Can anyone say why Gold has actually gone up today"
I suspect the answer is here:
http://www.telegraph.co.uk/finance/5190512/Markets-braced-for-historic-200bn-deficit.html
Subheading is "The pound slid after it emerged that Alistair Darling will this week unveil Budget plans which will consign Britain to a deficit dwarfing anything faced in peacetime."
58. str 2007 said...
Thanks guys.
You seem to have the same feeling as I did that Gold could go lower before it picks up.
Not the case today but I guess we'll see if sentiment changes back again.