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Gold prices surge past $522 level
BBC ^ | December 9, 2005 | London BBC

Posted on 12/09/2005 6:01:51 AM PST by DebtAndDelusion

The price of gold has continued to rise in Asian trading, climbing to its highest level since 1981. Gains came despite concerns that the market may be set for a correction and some analysts are now predicting that prices have even higher to go.

Precious metals have been given a boost as investors look to protect themselves against higher inflation and weakening currencies such as the Japanese yen.

Gold climbed as high as $522.70 an ounce, before falling back.

It was hovering around the $521 mark during afternoon trading in Asia.

'Dizzy high'

"There's some profit-taking now, but look at where we are," said Darren Heathcote of NM Rothschild.

"It's broken $520, the target we had yesterday... and it looks like $525 is the next target."

One broker in Tokyo said that: "Gold has been drawing very strong interest from Japanese investors, and I don't think this boom will subside in the near term."

There are a number of factors pushing the price of gold higher.

Gold is seen as a haven from inflation and weakening currencies, although historically, once inflation is taken into account, gold has not proven to be a good investment.

There is also speculation that Asian and European central banks may cut US dollar holdings in favour of gold.

There also is the year-end increase in demand for jewellery, analysts said.

The price of gold has climbed almost 19% this year and has nearly doubled during the past five.

"It's a dizzy high," said Rothschild's Mr Heathcote, but warned that "we are looking at a very overbought market".

"We're looking for a correction. It has to come at some point," he said.


TOPICS: Business/Economy; Foreign Affairs; News/Current Events
KEYWORDS: barkingatthemoon; blingbling; buymygold; evilfeds; gold; goldbubble; goldbug; goldbuggery; goldfarming; goldgeezer; goldgoldgold; goldmineshafted; goldshills; onetrickpony; oughtamentionthejoos; sansabelttootight; yukoncornelius
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Those darn Asians and Islamics are buying all the gold! It's been as high as 525 today and New York not even open yet. Thank goodness when they do open there the price will drop as the West continues to sell into the eastern buying spree.

One might think there was a big war or major crash coming. Oh well, wars and crashes happen all the time. And gold just keeps sitting there. It might not gain any interest or have fancy paper appreciation but it sure does store wealth in hard times.

Of course the smart money says, "it's different this time." Those are the four most dangerous words in the English language -- it's different this time. Gramps used to hear it all the time in the 20's.

Those darn Asians and Islamics. What are they trying to do -- ruin us all?

HG

1 posted on 12/09/2005 6:01:52 AM PST by DebtAndDelusion
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To: DebtAndDelusion
Precious metals have been given a boost as investors look to protect themselves against higher inflation and weakening currencies such as the Japanese yen.

But inflation is still low, and the depreciation of the yen should not impact the value of gold, as denominated in dollars. Personally, I think it's more the case of investors not being satisfied with the meager gains on the stock market, and being afraid to put more money into real estate. Gold is the only thing left, but I predict that gold will ultimately demonstrate that it's not a safe haven either.

2 posted on 12/09/2005 6:06:43 AM PST by Brilliant
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To: Travis McGee
Ping.
3 posted on 12/09/2005 6:13:38 AM PST by Joe Brower (The Constitution defines Conservatism. *NRA*)
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To: Brilliant
Inflation still low, please! I take it you don't have any children in a private school or college, nor have you had to visit the doctor for a serious illness.

Please don't recite to me Alan G's definition of inflation, subtracting fuel and food prices out because of their instability. I can't subtract them from my monthly budget.

Any reason you know of why the Fed stopped reporting the M-3 number?
4 posted on 12/09/2005 6:18:47 AM PST by mr_hammer (They have eyes, but do not see . . .)
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To: DebtAndDelusion

Do you know the North Koreans were printing US currency?


5 posted on 12/09/2005 6:21:25 AM PST by freema (Proud Marine Mom-What fools they are who doubt the ability of liberty to triumph over despotism)
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To: DebtAndDelusion

I believe the FED has decided to stop releasing money supply figures which are presumed to be way over the top. Inflation is a direct result of to many dollars in the economy. Gold is a hedge against printing money (inflation) and I belive this is the cause for the run-up.


6 posted on 12/09/2005 6:33:55 AM PST by eyedigress
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To: DebtAndDelusion

My father had a friend who put all his money into gold in the late 1970s. I think it cost him something like $800 per ounce.

Great store of value.


7 posted on 12/09/2005 6:42:12 AM PST by sitetest (If Roe is not overturned, no unborn child will ever be protected in law.)
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To: DebtAndDelusion

'Those darn Asians and Islamics. What are they trying to do -- ruin us all?'

Probably. The islamics esp would like nothing more than to ruin the U.S.


8 posted on 12/09/2005 6:45:09 AM PST by television is just wrong (Our sympathies are misguided with illegal aliens...)
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To: DebtAndDelusion

Gold is a GREAT investment. If I had invested all my money in Gold when I first graduated from High School over 25 years ago, by now I would have ----

Less money than I had when I graduated High School.

(Gold was over $800 an ounce back then).

BTW, My HOUSE has appreciated in value MORE than gold in the last 5 years. So I guess you could have bought gold, but you would have been better buying your neighbor's house.


9 posted on 12/09/2005 6:45:11 AM PST by CharlesWayneCT
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To: sitetest

Your father's friend might as well have painted a target on the crack of his butt. Look at a chart of that bull market: gold went from a leisurely $200 almost straight up to the $800s, in the course of one year. Anyone who jumped in at those levels was taking a considerable risk.


10 posted on 12/09/2005 6:46:07 AM PST by TEEHEE
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To: eyedigress; sitetest; Brilliant
I can't claim to be an economist but as soon as I heard the government was going to hide the money figures from the citizens I knew two things. I knew the media wouldn't report it and that gold would not like it.

Father and Gramps used to have some terrible arguments about gold. Gramps was an old Bryan supporter and made the cross of gold argument all the time with Father. Father said he would keep his gold just the same.

Unfortunately Father bought stocks on margin in 1929. When the crash came we had to move out of the city house onto the farm. If he hadn't had his gold I think we would have starved during the 30's.

Of course that experience taught some lessons about the goodness of the land and gold's ability to keep folks solvent during the depression.

Darn Islamics and Asians buying all the gold, and the government hiding the M-3 money supply figures from the public so they can print all the money they want to. The working man in this country is getting it from every end.

Oh well. Still got the farm, still got the gold and still have most of my teeth.

HG

11 posted on 12/09/2005 6:47:33 AM PST by DebtAndDelusion
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To: mr_hammer

fuel and food are not entirely removed from the inflation numbers, they just aren't useful in the monthly numbers because they are too volitile.

In the past 30 years, fuel prices have risen by just about the same amount as the underlying inflation.

IN the past 30 years, food prices have risen by much less than the amount of inflation.

College costs have shot up. So has medical costs.

But Gold wouldn't have been a good way to invest your kids college fund.


12 posted on 12/09/2005 6:48:52 AM PST by CharlesWayneCT
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To: sitetest
Great store of value.

Yeah... your friend's dad was a johnny-come-lately boob who should've bought in when it was < $40 in '70.

13 posted on 12/09/2005 6:50:49 AM PST by Willie Green (Go Pat Go!!!)
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To: DebtAndDelusion
I knew the media wouldn't report it and that gold would not like it.

This recent non-stop gold launch began almost immediately after the M-3 announcement. There's a possibility that the new Dubai gold exchange, online as of last week or the week before, is having some impact. Whatever the case, it's starting to feel like someone somewhere knows of a critical impending change in world economics.

14 posted on 12/09/2005 6:51:41 AM PST by TEEHEE
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To: DebtAndDelusion
"There's some profit-taking now..."

How could this possibly be?...everybody knows that lots of people lost money om gold during the 80's. /s/
15 posted on 12/09/2005 6:53:13 AM PST by Liberty Valance (Give my blankets to my buddies and the fleas to Diamond Joe.)
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To: DebtAndDelusion

And note that the government hasn't even started "hiding" the M3 numbers. They won't be "HIDING" them at all, but they don't stop reporting them until march of next year.

They official position is that M3 won't be reported anymore because it is a useless piece of information.

I'm not sure how not knowing the extra value of large CDs and repurchase agreements allows the government to print more money (which is covered under the M0 number) or relaxing credit (covered under M1/M2)


16 posted on 12/09/2005 6:54:13 AM PST by CharlesWayneCT
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To: Willie Green
Yeah... your friend's dad was

Hmmmmmm... looks like I have a dyslexic keyboard this morning...
"friend's dad" should be "dad's friend"

Darn... I almost made it for a full year without a single typo...
Now I'm gonna have to wait unti 2006 to try it again.

17 posted on 12/09/2005 6:54:55 AM PST by Willie Green (Go Pat Go!!!)
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To: eyedigress
The real cause of the run-up in gold is the frenzy of speculation. When the demand goes down...gold will crash. It is a commodity, folks...nothing more, nothing less. It ain't no more a store of value any more than, say holding copper or .22 bullets.

As a matter of fact, I would argue that .22 bullets would be a better store of value in a general economic crash than gold. You can at least get some squirrels for supper with bullets.

18 posted on 12/09/2005 6:57:51 AM PST by B.O. Plenty (Islam, liberalism and abortions are terminal..)
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To: sitetest

If he would have bought in 1972 instead of 1979 he would be rich. What's your point, buy high - sell low?


1972 High 70.00 Low 44.00
1973 126.00 64.00
1974 195.00 117.00
1975 185.00 135.00
1976 142.00 102.00
1977 168.00 177.00
1978 243.65 165.70
1979 524.00 216.55
1980 850.00 474.00
1981 599.25 391.25
1982 488.50 296.75
1983 511.50 374.25
1984 406.85 303.25
1985 340.90 284.25

2000 325.50 264.10
2001 291.45 256.65
2002 342.75 277.75
2003 417.25 319.90
2004 454.20 375.00
2005 524.10 ???.??


19 posted on 12/09/2005 7:02:04 AM PST by eyedigress
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To: B.O. Plenty

I have both :^)


20 posted on 12/09/2005 7:02:38 AM PST by eyedigress
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