Posted on 09/26/2024 2:29:10 AM PDT by jimjohn
Nations are buying gold for their central banks. People are scooping up gold as a hedge against financial concerns. As interest rates drop and economies all over the world start to flow, governments will “stimulate” the economies. This debases the currency and gold becomes more “valuable.”
Retail customers are starting to buy precious metals at a larger rate. This is usually the beginning of the end of the gold bull—retail buyers are usually the “last to the party.”
Oil is being pumped at record levels. The supply is good. When the supply is going up, the price will come down.
While both are commodities, they are not linked to each other.
Two separate influences. Gold is going up because of the state of the failing economy and devaluation of the dollar that buys that gold. And oil would also be going up except they are being squeezed and threatened by Newsom, Biden, and Harris for price gouging. Big oil is being cautious and treading lightly with prices in case Harris wins. They are trying to draw the heat off themselves and hope to fly under the radar.
Because Biden is draining our reserves to force prices down during the election.
“Oil is being pumped at record levels. The supply is good. When the supply is going up, the price will come down.”
Yes, current supply is a huge factor.
I can’t speak for gold, but I do know that oil production is at record highs while demand is flat or even dropping.
It is simple, really. Biden and/or whoever is managing the admin is dumping product from our strategic petroleum reserve (what we keep so we will have a supply for war) into the market to suppress prices. Basic laws of supply and demand. Dump a bunch of supply on any market, and the value goes down....., at least temporarily
Add in the rising level of geopolitical uncertainty with a lack of political leadership in the West and you have the current conditions.
I suspect the un-pegging of the dollar (at least partly) from the price index about 6 months ago is part of the reason. Also the relatively even upcoming election, with SUCH different two candidates.
There are likely lots of people betting on the results of this election.
https://www.iea.org/reports/oil-market-report-september-2024
World production at record, but demand going flat with demand growth slowing. Inventories have been dropping during the summer when typically increase.
Oil and diamond supplies are governed by cartels to influence price.
Gold production influenced by price increases or declines, but most gold is not consumed. It sits around for the world to speculate over when everyone freaks out.
Shhhh….the Biden administration has quietly relaxed the restrictions on drilling for oil and natural gas. They have been quiet about it so they don’t make their Dim Warmageddon cult followers mad. But they want lower energy prices in an election year.
Gold is money. Everything else is credit.
I have wondered for some time about oil prices. Where I live, gas varies in price all the time, is generally low compared to many places, but motor oil just seems to go up continually. Why is this?
The supply of gold is largely inflexible.
Gold is also easier to store and transport and requires less expertise and infrastructure to store, so demand is much wider (compared to crude oil).
Oil is not governed by a cartel.
OPEC is long dead as a factor.
Gold is fairly well controlled. I mean, the price is set in London in what has traditionally been called the “Morning Gold Price Fix.”
And if you want to see “cartel like action”, look at silver.
Gasoline usage declines at the end of summer travel season (lower demand) and the administration has been releasing oil from the strategic petroleum reserve (higher supply).
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