Gold - How Far Will It Go..

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empirex

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Were will the gold rally end. How high will it go..

April 28, 2011 – $1,535.90 oz
April 29, 2011 – $1,569.30 oz
May 02, 2011 – $1,577.40 oz
July 13, 2011 – $1,594.90 oz
July 17, 2011 – $1,598.60 oz
July 18, 2011 – $1,607.90 oz
July 19, 2011 – $1,609.55 oz
July 24, 2011 – $1,622.99 oz
July 25, 2011 – $1,624.30 oz
July 27, 2011 – $1,627.73 oz
July 29, 2011 – $1,631.80 oz
Aug 01, 2011 – $1,632.80 oz
Aug 02, 2011 – $1,661.38 oz
Aug 03, 2011 – $1,675.90 oz
—————————— Now at this level
Aug 09, 2011 – $1,782.50 oz
Aug 10, 2011 – $1,814.80 oz
Aug 11, 2011 – $1,815.50 oz
Aug 18, 2011 – $1,845.30 oz
Aug 19, 2011 – $1,881.40 oz
Aug 22, 2011 – $1,911.52 oz
Aug 23, 2011 – $1,913.50 oz
 
I wonder if its really gold going up or the USD going down? There are two factors at play here. The other commodities are also going up, just look at oil. My take is that the world is loosing confidence in the Dollar and that is doing this to gold.

I'm still wary of gold though. In some respects its the biggest bubble of them all.
 
I'm by no means a financial expert, but from what I've read it's not solely Dollar weakness (which is definitely playing a part), China and many other countries are buying large amounts of gold right now..
What is this gold bubble you speak of though, if anything, it's the opposite?
 
Gold is being traded in far too high volumes these days. It's volatility will just keep going up.

I used to make it a point to buy as much gold as possible (The 1100 USD/oz AU days), and made a tidy profit, but my word it is like gambling these days.
 
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gold price since '95
 
Bernarke's QE packages and inflation driven economy is to blame. They simply print to much money.
 
Gold used to be tied to currencies and have a much steadier price as a result as governments used to be big buyers of Gold. These days Gold is all about speculation. Its no different from Dutch Tulips. Have you looked at the value of gold over the past 10 years? There is no way that it went from $300 and ounce to $1900 in that short space a time due to demand for jewelry going up. Its how bubbles work. People buy it not because they need it but because they are speculating on the price going up more. Its the same as what happened to property between 1998 and 2007 in SA. People bought houses and left them empty and still made a killing on the capital growth alone. The average house price in 1998 was 1.7 times the average salary. In 2007 it was 5.4 times the average salary. Demand did not increase 4 times because there where more people or more real demand, it was just speculators.

Economic bubbles are created by rich people creating a craze that drives the price of something up to ridiculous levels before they cash out and leave the now vastly overpriced thing in the hands of the fools who got in late. It's happened with houses, Persian carpets, dot com stocks, dutch tulips, and now Gold. The price of gold has nothing to do with underlying demand for jewelry or industrial uses anymore, its just the speculators buying in to create the frenzy and waiting to cash out. If you wanted to make money off it getting in a while ago would have been more advisable. There is no telling when this one will pop but the graphs don't lie. In September 06 the gold price was $600 an ounce. Now its triple that 6 years later. How on Gods green earth can anyone think this is anything but a bubble? Things don't change in value that fast for natural reasons. Its speculation and greed. By the time everyone has caught on and is talking about it its too late to profit in a big way as the risk is just too high of when the bubble will pop.
 
Cius said:
Gold used to be tied to currencies and have a much steadier price as a result as governments used to be big buyers of Gold. These days Gold is all about speculation. Its no different from Dutch Tulips. Have you looked at the value of gold over the past 10 years? There is no way that it went from $300 and ounce to $1900 in that short space a time due to demand for jewelry going up. Its how bubbles work. People buy it not because they need it but because they are speculating on the price going up more. Its the same as what happened to property between 1998 and 2007 in SA. People bought houses and left them empty and still made a killing on the capital growth alone. The average house price in 1998 was 1.7 times the average salary. In 2007 it was 5.4 times the average salary. Demand did not increase 4 times because there where more people or more real demand, it was just speculators.

Economic bubbles are created by rich people creating a craze that drives the price of something up to ridiculous levels before they cash out and leave the now vastly overpriced thing in the hands of the fools who got in late. It's happened with houses, Persian carpets, dot com stocks, dutch tulips, and now Gold. The price of gold has nothing to do with underlying demand for jewelry or industrial uses anymore, its just the speculators buying in to create the frenzy and waiting to cash out. If you wanted to make money off it getting in a while ago would have been more advisable. There is no telling when this one will pop but the graphs don't lie. In September 06 the gold price was $600 an ounce. Now its triple that 6 years later. How on Gods green earth can anyone think this is anything but a bubble? Things don't change in value that fast for natural reasons. Its speculation and greed. By the time everyone has caught on and is talking about it its too late to profit in a big way as the risk is just too high of when the bubble will pop.
Click to expand...

It is not all bubble though commodity prices are also tied to money stability, a weaker dollar will result in a higher commodity price across the board.

The federal reserve also does speculation, it speculates how much money it needs to print for the inflation driven economy and in times when growth aren't exponential we see a rise in prices across the board.
 
Cius said:
Gold used to be tied to currencies and have a much steadier price as a result as governments used to be big buyers of Gold. These days Gold is all about speculation. Its no different from Dutch Tulips. Have you looked at the value of gold over the past 10 years? There is no way that it went from $300 and ounce to $1900 in that short space a time due to demand for jewelry going up. Its how bubbles work. People buy it not because they need it but because they are speculating on the price going up more. Its the same as what happened to property between 1998 and 2007 in SA. People bought houses and left them empty and still made a killing on the capital growth alone. The average house price in 1998 was 1.7 times the average salary. In 2007 it was 5.4 times the average salary. Demand did not increase 4 times because there where more people or more real demand, it was just speculators.

Economic bubbles are created by rich people creating a craze that drives the price of something up to ridiculous levels before they cash out and leave the now vastly overpriced thing in the hands of the fools who got in late. It's happened with houses, Persian carpets, dot com stocks, dutch tulips, and now Gold. The price of gold has nothing to do with underlying demand for jewelry or industrial uses anymore, its just the speculators buying in to create the frenzy and waiting to cash out. If you wanted to make money off it getting in a while ago would have been more advisable. There is no telling when this one will pop but the graphs don't lie. In September 06 the gold price was $600 an ounce. Now its triple that 6 years later. How on Gods green earth can anyone think this is anything but a bubble? Things don't change in value that fast for natural reasons. Its speculation and greed. By the time everyone has caught on and is talking about it its too late to profit in a big way as the risk is just too high of when the bubble will pop.
Click to expand...

Depends on how you measure things. Gold is dollar denominated, if the value of the dollar declines then the gold "price" will increase in dollar terms.

Also because of the lack of economic confidence and what Bernanke and company worldwide are doing to paper money, people are buying gold as a store or value as they don't want to make more risky investments in stocks, this increases demand raising the price.

I certainly don't think it is a tulip bubble as you put it, but it certainly wouldn't be as high as it is if the governments around the world and their central bankers didn't screw things up so badly.

It still has not reached its record inflation adjusted high which is around $2400 dollars I think....AND those prices in the OP are from 2011 not 2012.
 
WilD_CaT said:
Depends on how you measure things. Gold is dollar denominated, if the value of the dollar declines then the gold "price" will increase in dollar terms.

Also because of the lack of economic confidence and what Bernanke and company worldwide are doing to paper money, people are buying gold as a store or value as they don't want to make more risky investments in stocks, this increases demand raising the price.

I certainly don't think it is a tulip bubble as you put it, but it certainly wouldn't be as high as it is if the governments around the world and their central bankers didn't screw things up so badly.

It still has not reached its record inflation adjusted high which is around $2400 dollars I think....AND those prices in the OP are from 2011 not 2012.
Click to expand...

That too is my line of thinking. One could view it as a bubble if the world economy was functioning as always with the usual ups and downs, but for me there is far more than pure speculation based on profit making occurring right now. There are genuine concerns about paper currencies worldwide with certain Euro economies facing serious challenges ahead. Gold is the fallback, the safe bet, while all these balls remain in the air.
 
Gold is only a fallback for if civilization survives the collapse of FIAT currency. That's not going to happen, neither of them are.
 
I remember back in January / February an analyst said that gold could very well touch the $2000 mark at the end of the year. I actually laughed this off, but it seems that it will definately surpass this mark this year.
 
I heard Mitt Romney wants to tie the dollar to gold once again if he wins. Surely that will skyrocket gold to even $10000.
 
Well after all the QE3 hints Bernanke gave at Jackson hole i think it's safe to assume Gold will be marching northward for some time to come.
 
czc said:
I heard Mitt Romney wants to tie the dollar to gold once again if he wins. Surely that will skyrocket gold to even $10000.
Click to expand...

No ways Romney is pro establishment.
 
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