In times of uncertainty, precious metals can provide you and your family with security and protection. The price of gold has risen 2% this week. The correlation between this new wave of buying and the price of gold appears to be positive, which indicates that the gold market is likely to bounce back after the controversy surrounding the Federal Reserve’s hiring of former Goldman Sachs CEO, Henry Paulson, has died down, but investors should not expect the rally to continue into next year.
Experts warned ‘gold will be priced out of the market'” reported that “several high-profile economists” have expressed concerns about the potential impact on the economy of a drop in the value of gold, which has been on a bull run this year and as low as $2,600 a troy ounce. This was accompanied by a warning by the head of the Canadian senate’s economics committee that if gold becomes significantly less expensive than expected, some retail investors may consider that gold-linked cryptocurrencies like bitcoin can still be worth a decent profit.
It also stated that “those familiar with the Bank of England’s minutes – which are released just before a crucial meeting of the Monetary Policy Committee, or MPC – are convinced there is now widespread belief that inflation is heading toward 2 per cent at the very least.
SILVER FALLS in the face of a global economic meltdown by William Todd in Washington. Gold is what helps keep the U.S. dollar, global equities markets and the banking system operating for the foreseeable future. Gold is also an important component of modern medicine and has always been associated with high societal value. Until now, precious metal bullion has had limited access to wide exposure to the U.S. economy and market fluctuations. Stocks and other paper assets are rarely seen as a viable security in times of financial uncertainty. Only precious metals have such long-term safety and durability. What comes next?
The price of gold dropped about 3 percent on Friday. However, according to the website raremetalblog.com, the fall is only the start of a major selloff.
Given the longer term dynamics, in terms of rising interest rates, mass layoffs, capital controls, terrorism and tightening monetary policy; it would be a safe bet to see prices move towards the 4,000 level. This is a longer term target but it is a target that will take some time to get to and I personally think that gold could get there fairly soon. At this point, the main market participant – the “Gold crowd” are viewing the trend with caution and not expecting any dramatic moves before the year is out.
The reason gold’s price will not drop to 4,000 (or even 2,000) is because of central bank buying of gold and the U.S. dollar. Gold Money believes the U.S. will keep its interest rate policies in place this year. In contrast, the Reserve Bank of Australia has already cut its benchmark interest rate from 6.25 percent to 5 percent. As gold has experienced a tenfold increase in its price, only the price of the U.S. dollar will keep declining, as a rule of thumb. Gold is an excellent conductor and it has the benefits to offer much better protection from RF interference and interference.
As a U.S. dollar weakens, gold could reach a value that is similar to its value after the U.S. Dollar collapse in 2008. China and other global central banks are also positioning themselves for an impending future global collapse. Gold is currently going up because investors believe the dollar is going to keep dropping. There will be no crash until the paper assets collapse. This is an essential factor in controlling the precious metals market. A good example is the following quote from the website GATA.info : “Looking at the futures market we see Gold rising as the US dollar weakens. Currently the USD is at an all-time high and it is doubtful it will fall any further because of a large debt market. read more here http://www.bu90.info/ about precious metals like gold and the outstanding advantages and are beneficial for many investors.
The more domestic investors want to convert their dollars to gold, the higher the price of gold, because the paper asset has fallen in value. So when US asset prices fall, gold will rise accordingly.” GoldMoney.com The full article by William Todd is available at: Gold Markets Crash and Boom What it will take to bring gold crashing. http:www.goldmoney.comarticlesgeneralgold-markets-crash-and-boom How Will the Crash Happen? This is the pivotal question that has not been adequately answered and a silver tsunami is just as likely as gold. In fact, it could be worse. A key aspect of the dollar collapse, the second largest market participant, is the interest rates of the major world central banks.