Gold storms past $1,800 towards new record high (Inflation?)

Yahoo Finance ^ | July 8, 2020 | Peter Hobson

[Perseverando]

LONDON (Reuters) - Gold pushed above $1,800 an ounce on Wednesday for the first time since 2011, with analysts expecting further gains as investors stock up on an asset they expect to hold its value while the coronavirus convulses the global economy.

Spot gold prices have surged 40% in the last 14 months and are within striking distance of 2011's record high of $1,920.30 an ounce.

"We'll be challenging the $2,000 level by the end of the year," said Ross Norman, an independent analyst. "We are in a bull market for gold."

(Graphic: Gold's latest rally, https://fingfx.thomsonreuters.com/gfx/ce/jznpnzmokpl/GR%20RALLY.JPG)

Powering the rally is economic and political uncertainty caused by the COVID-19 pandemic and action by central banks, which have responded to slowing growth and the virus by slashing interest rates and flooding markets with cash.

This has fuelled fears of inflation, which would typically devalue other assets, and has also lowered returns on government bonds, making gold more attractive.

Gold's rise has been mirrored by a slide in real yields on 10-year U.S. bonds, which at around minus 0.8% are near record lows.

[Perseverando]

GC=F is @ $1823.50 a moment ago. And the National debt just keeps plugging away: https://usdebtclock.org/

[Perseverando]

Let’s try that again: https://usdebtclock.org/

[SunkenCiv]

Oh, heavens to Betsy.

[RandFan]

Everyone should own some physical gold!

It has been decent investment over the years.

[Alberta's Child]

I still think DEFLATION is a bigger threat here. and with oil still down below $45/barrel I don’t see an across-the-board hike in commodity prices that I’d expect in an inflationary environment.

This may be tied to the news that broke last week about the phony gold reserves in China.

[RandFan]

Only buy from reputable dealers.

Whatever you do do not buy gold off eBay or sites like that.

Sorry it’s too risky even if it looks like a good deal!

[faithhopecharity]

one of the results of the virus scare Lockdown has been some much, much higher costs for many groceries, restaurant food, and a number of additional things in the marketplace

which is a clear form of inflation, yes

[Nateman]

I remember when gold was at 300$ . At the time I wish I had some cash because I would have bought all I could.

[wny]

I’ve been invested in the gold sector for 10+ years, I read/have read many, many different newsletters, interviews, sector research publications, etc. I have never heard of any of the “analysts” quoted in this article. when the non-gold investors start paying attention, you know it’s taking off.

[RandFan]

Nate,

It’s not too late to get in. It’s going to 2k plus in future and beyond. so that’s a tidy profit -IF- it comes off!

[Scott from the Left Coast]

Civilization teetering on the precipice of a totalitarian dark age certainly can’t help...

[Billthedrill]

Brass and lead are getting expensive, too. Sign of the times.

[9422WMR]

I’m ready to sell a few ounces. How much discount should I expect from spot gold prices?

[ASA Vet]

Brass and lead are getting expensive, too.

Because those are actual assets with intrinsic value, unlike shiny stuff with no survival benefit.

[RandFan]

The spread is usually 5% depending on the coin and quantity. Find a reputable dealer you shouldn’t a have problem..

[RandFan]

I have bought Krugerrand’s for 2-3% above spot. American Eagles tend to have a higher premium.

[BenLurkin]

Inflation?

You bet your bippy. 70s style.

[Nateman]

I think gold is over priced right now. No way I’d touch it .

[No.6]

Fake gold makes real gold rise.

https://www.foxnews.com/us/wuhan-company-now-at-the-center-of-one-of-the-biggest-fake-gold-scandals

[Freedom4US]

I agree everyone should hold at least some physical gold. Long ago the recommendation was 2% of net worth, not counting any real estate.

However it is decidedly not an investment, by definition. Nor is it a commodity, it actually trades on the currency desk. Buying gold is closer to speculation, or trading in a (now) foreign currency. Now it is true one can make a lot of money speculating in foreign currency, but one can also lose their shirt.

The key thing about gold, is that it is an asset that doesn’t depend on someone else to perform. It has a value that is independent of the one issuing it. Having said that, the price is manipulated, through various schemes and has been for decades. It should have been trading well north of $5000 long ago. Maybe it’s a good thing it isn’t, but I don’t know.