Realistically, only one thing is obvious, and that is that this is a programmed drop. Several large financial houses have shorted gold, so they need its price to drop to make a huge profit.
But this is just a thing in itself. It says nothing about the future of the price of gold, or its availability.
What it does say, however, could be entertaining. That is, if the price of gold goes back up too quickly, these big investment houses are going to lose billions.
So no matter our opinions, all of us should at least hope for a gold recovery until the next call. Then game play can resume. If that recovery does evidence itself, though, these investment houses will not be happy, and will likely try to cause an anti-gold hubbub.
So have some popcorn handy.
If you read the news, The New York Times thinks gold is going down. Why?
Here’s how they put it:
“Now... things are looking up for the economy and, as a result, down for gold. On top of that, concerns that the loose monetary policy at Federal Reserve might set off inflation — a prospect that drove investors to gold — have so far proved to be unfounded.”
So Wall Street is growing increasingly bearish on gold, an investment that banks and others had deftly marketed to the masses only a few years ago.
Ha-ha. Do you remember Wall Street deftly marketing gold to the masses a few years ago? Show us the ads! Give us the brokers’ phone logs! Prove it!
The fact is, the masses never got anywhere near gold. Not even close. Most people have never seen a gold coin. Most are even more reckless! They’ll wait for gold to hit $2,000... or $3,000 before they buy.
Which is why we’re nowhere close to the top. Wall Street never marketed gold deftly... or any other way. Not even in its usual greedy, heavy-handed fashion. And the masses never bought it.
Just the opposite. As the price of gold rose, we saw ads in the paper soliciting people to SELL gold. The masses held gold parties... in which they sold their golden heirlooms at preposterously low prices.
And those concerns that money printing by central banks would cause trouble that have “so far proved to be unfounded”? Well, stay tuned!
Here’as More good news from the NYT:
“On Wednesday, Goldman Sachs became the latest big bank to predict further declines, forecasting that the price of gold would sink to $1,390 within a year, down 11% from where it traded on Wednesday. Société Générale of France last week issued a report titled “The End of the Gold Era,” which said the price should fall to $1,375 by the end of the year and could keep falling for years.”
Why “good news”? Because the more bearish on gold Wall Street becomes, the more the rubes and pumpkins sell. The more they sell... the cheaper it is for the smart money to buy.
I’d personally like to see gold crash down around $1,300... or lower.
First, because this would mark a real correction in the bull market. It’s been going on for 12 years without a serious correction. Not a healthy situation. I’d like to get the correction out of the way... shaking out the Johnnies-come-lately and the two-bit speculators. Then, the final stage in the bull market could begin.
Second, because it gives me a chance to buy more. Because no matter what noise you hear in the press or in the street, central bankers are far more recklessness than ever.
The monetary authorities are convinced that they can revive sluggish economies by printing money... and they’ll continue printing until all hell breaks loose.
Then, when the dust settles... when pounds, pesos, yen, euros and dollars have all been beaten and bruised... there will be one currency still standing tall. That will be gold.