Posted on 10/06/2009 1:10:23 PM PDT by RC one
LONDON (Reuters) - Gold surged to a record high above $1,040 per ounce on Tuesday, with buying fueled by dollar weakness after a report, later denied, that Gulf Arab states were considering abandoning the U.S. currency for oil trade.
Both spot gold prices and U.S. gold futures have benefited from a convergence of factors including the dollar's decline, technical buying momentum and worries about potential inflation as central banks struggle to emerge from unprecedented fiscal stimulus measures.
"In an environment where interest rates are virtually zero, the incremental cost of moving into gold is nil. It stands to reason for investors that gold is more desirable," said Jack Ablin, chief investment officer at Harris private bank in Chicago.
Spot gold hit a historic $1,043.45 per ounce and was last up 2.2 percent at $1,039.55, compared with $1,016.65 quoted late in New York on Monday.
U.S. gold futures hit a record high, while the metal also hit six-month highs when priced in sterling and euros, breaking above 700 euros an ounce for the first time since early April.
For a graphic on gold's price in dollars and euros, click on:
http://graphics.thomsonreuters.com/109/GLD_PRCEUR1009.gif
A positive technical picture for gold fueled buying on the fund side, traders said. However, the weight of near-record long positions in New York gold futures still leaves the market vulnerable to a correction.
The dollar slipped sharply after UK newspaper the Independent said Gulf Arab states were in secret discussions to end the use of dollars in oil trading.
(Excerpt) Read more at news.fidelity.com ...
I lost all my gold when my dentist said I needed new fillings..........
“The US dollar is going to collapse, very soon.”
I think you are correct. He is printing and borrowing as fast as he can. He is nationalizing everything. What happened in South America, what happened in Russia, etc,, can most certainly happen here. there is no magic support for our currency just because we are “America”. And repubs have been working just as hard for this day as Obama is. they must all pay at the ballot box.
Even if there was a nuclear war and all the nation’s of the world collapsed into chaos, people would still need a medium of exchange for trade. Even the most primitive civilised economy would recognise gold as a medium of exchange, because gold is portable, easily divisable and rare/desirable enough to work as such.
For humanity to go back to a purely bartering economy would require us to devolve back into knuckle-dragging cro-magnon men were all memory of civilisation had been wiped from our minds.....
With the possible exception of a brief manipulated plunge to drive out all the gold hedges, you are correct.
BTW, it's nice to see someone else paying attention.
Duh
I don't know if you've been paying attention, but all memory of civilization *has* been wiped from, conservatively, 50% of the population's consciousness.
When fiat monetary systems crash, the laws of supply and demand continue to be valid. In the absence of a commonly accepted means of exchange other forms of “near money” come to the fore. Be it precious metals, personal talents or barter of physical goods and services an alternate economy will emerge. It may not be as efficient or uniform as a currency based economy, but the exchange of goods and services will be perpetuated by necessity in order for the adaptable portion of society to survive. I guess the best modern examples are the flourishing Black Markets created by the shortages inherent in every Communist society.
I’ve heard that said...tools. I’ve been picking up tools here and there. I also think that addictive necessities would make good currency come doomsday—coffee, tobacco, alcohol.
Looks like it’s on it’s way. I have read that when the dollar finally tanks, it will jump by $50-$100/day. Aside from the fact that I am invested (not too heavily) in metals, I find it very interesting that Gold is now trading up despite gains in the stock market when it used to consistently run counter current to the DOW.
If someone is buying gold, that means someone is selling it. I think the time to buy gold was during the last stock boom, and vice versa. The time to buy something is when it’s cheap. Not now.
I don’t know. I think in nuclear winter, people might decide yellow metal isn’t all that hot after all. I don’t get the intrinsice value of the stuff. There are lots of things I’d rather have.
None of it makes any sense. On the one hand, they say it’s going to $2000/oz. On the other hand, they say the dollar is going to be worthless. Um, ok. So why is it a big deal if it’s worth 2000 worthless dollars? They think people are going to care about yellow metal when doomsday comes, but I don’t think so. I think food, shelter, skills, usable things will matter. Yellow metal will be down the list.
It’s not to buy and sell.
It’s reserve money for TEOTWAWKI, and that’s all it is.
If you turn little green slips of paper into the old yellow fellow, don’t do it with the goal of having more slips of paper in the future.
That’s not what gold is for.
I guess if you have giant boatloads of money, converting some of it to gold makes sense. For the average joe like me, it’s not an issue. I could lose what I could afford in thr sofa cushions. I’m gradually stocking up on things like coffee, booze, tools, tobacco. Same kind of thing that holds currency in prisons.
Now seems like a dumb time to be buying gold. I envy the sellers, though.
The US Dollar isn’t the only currency, that’s why.
As a seller of siver at $20 oz back in the 70s, I hear you. However, seeing the manipulation/screwups now being done by the govt, how can we tell if gold at $1000+ is high?
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