Spot Gold Takes A Huge Fall
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Today, the U.S. dollar jumped to a three-month high after Standard & Poor’s downgraded Greece’s credit ratings on concerns the country will struggle to rein in its deficit. The dollar strength had an inverse action on the spot gold price. As I’m writing this the spot gold price is off $37.
The dollar rallied last year as the credit crisis mushroomed, driving investors to the perceived safety of U.S. dollars. Even as the credit crisis has eased this year, the dollar has still tended to gain on days the global economic outlook has worsened.
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There’s a tidal wave of money being created and pushed at the system by the wave machine in the basement of the Fed. As the perceived deflationary pressures increase the wave machine will be turned up to ever-higher settings.
Expect this to get underway in earnest once stimulus plans have been enacted and stimulus money has begun to flow. Gold could very well fall until that time, it could be months. So what? If I part with physical now, will I be able to get it back? I choose not to gamble.
Metal Detectors
Yes, gold is manipulated. Yes, it is going down ($500, minimum). Just look around you at ALL the commodities, almost all of them have been slashed by at least 50%, do you really think gold is any different? Its not.
Copper
So I’m confused! Is the price of gold going UP or DOWN?! If gold can’t go through the roof during a ‘global fiat currency’ freakout, or credit crunch, debt bubble burst, whatever, then when? My sense is that the deflation demon will finally take out gold (‘goes up on an escalator and comes down in an elevator’!)
I also agree with whomever said gold was a good hedge against inflation NOT recession. The hysterical chatter about an inflation time bomb going off is exactly that… I’d say gold has a greater chance of going down to $500 then does of hitting $2K.
California Gold Nuggets