Posted on 10/21/2011 6:57:33 AM PDT by TigerLikesRooster
Could Money Supply to Lead to Gold $10,000/oz?
Mark O'Byrne
Published 10/21/2011 Return To Article
Gold is trading at USD 1,623.80, EUR 1,177.95, GBP 1,027.01, JPY 124,535.72, AUD 1587.39 and CNY 10,354 per ounce.
Gold’s London AM fix this morning was USD 1,623.00, GBP 1,027.02 and EUR 1178.14 per ounce.
Yesterday’s AM fix was USD 1,629.00, GBP 1,033.24 and EUR 1,180.17 per ounce.
Gold prices are mixed today as markets remain on edge due to increasing divisions amongst European leaders on how to solve the intractable euro-zone debt crisis. There continues to be very strong demand for physical bullion globally and support is strong at the $1,600 level due to this demand.
The sharp fall of copper yesterday, by 6%, is an indication that the US, Chinese and indeed global economy is very fragile and may soon begin to contract.
U.S. M2 Money Supply: Accelerating Sharply in 2011
Physical demand in Asia, mainly India and China, has entered the traditional peak season with Indian festivals and the increasingly important Chinese New Year.
This is reflected in premiums in Asia which remain good. There are reports of massive physical buying out of China on gold’s fall close to $1,600 yesterday. The most active Shanghai gold futures traded at a premium of more than $10 over spot prices earlier today. The contract stood at 335.22 yuan a gram, or $1,634 an ounce, at a premium of $3.
(Excerpt) Read more at resourceinvestor.com ...
copper’s fall of 6% is not an indicator of what we will do economically. It is an economic indicator of what IS happening and will soon be reported by the traditional trailing indicators that everyone uses to see how the economy is doing.
If so, you will be welcoming me as your new Free Republic Overlord as I’ll buy it from JimRob and set him up for life too, LOL!
The Fed’s policy appears politically motivated as a means to keep American stock markets trading at higher levels. What happens when the typical effect of such policy (inflation) comes to fruition?
If deflation kicks in eventually, gold will fall too.
Related and a likely reason why American stocks are soaring today.
http://www.reuters.com/article/2011/10/21/markets-forex-idUSN1E79K0I320111021
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.