Gold never was in a bubble - but how about copper, nickel et Al?

[Johnnny]

Mineweb - Gold never was in a bubble - but how about copper, nickel et Al? - GOLD ANALYSIS

Gold is consolidating and may well be poised for another run at its peak. Maybe we should be warythough of base metals prices which have perhaps risen too far too fast.

Only a few months ago there were many commentators out there who were stating that the gold price, as it approached $1200, was in a bubble waiting to burst. The recession was ending and gold had to be overpriced, there being no longer any need to hold it. The flow of funds into bullion and ETFs would cease and the gold bulls would be defeated yet again. The holders of gold would sell, and scrap sales would soar. Naturally such talk did have an impact and some of the less secure holders drifted out of gold into the general stock market and into other commodities.
But gold did not collapse. It has little reason to do so. There is still financial uncertainty throughout most of the world. Governments are still debasing their currencies printing ever more money and the threat of serious inflation remains - it is only being held back by the fact that the promised recovery just doesn't seem to be happening yet. Those who moved out of gold into say base metals, or the stock market may be congratulating themselves as prices have risen, but such self-congratulations may well be premature. Gold seems to have been consolidating nicely at around current levels and looks poised for an upturn again, while surely base metals in particular are rising well beyond justifiable levels?
Copper is now $3.53/lb - soaring back towards levels last seen at its 2008 peak before the collapse. While nickel has also recovered from its depths with sharp increases, it's still well short of its peak, but rising again fast. Aluminium shot up this week. Lead and zinc have had a good run up this year too. But where's the long mooted industrial recovery which is needed to justify these gains? It still seems almost as far away as ever and there are signs that Chinese demand, which has just about carried the markets on its own, may be faltering as some of the speculative stocks which have been built up there may be about to be run down. China has power problems too, which could presage a fall in demand as large areas of the country are suffering from drought and thus having to cut the country's very significant hydropower capacity.

 

[Liberalman]

Gold will go up when inflation comes back and the only way for inflation will come back if everyone is working and getting money to spend when inflation comes back interest rates starts to go up then people buy gold to protect themselves from rising prices.

When gold is too high then people start to buy the cheaper metals hoping that those prices will rise as well

 

[darkbeaver]

The Genesis Of The Gold-Tungsten: The Rest Of The Story

 

[darkbeaver]

Andrew Maguire finally exposes systemic fraud by CFTC & JPMorgan

 

[darkbeaver]

The Genesis Of The Gold-Tungsten: The Rest Of The Story

I was hoping someone would read this and esplain it to me. Its an interesting story, lots of detective crime thriller stuff, an gold. Do you know where your gold is? I don't know where mine is.

 

[SirJosephPorter]

And how do you know that gold is not in a bubble? Gold dropped from around 800 $ down to 200$, before climbing back up to 1000 $. How do you know the same thing won’t happen again?

In fact, I would be cautious about investing in gold right now. It has gone up considerably, and we don’t know if it goes up to 2000 $ from there or down to 500 $. I think stock market is much surer investment right now that gold.

 

[Bar Sinister]

I've been watching this gold thing for several years now. The dramatic rise in the price of the metal seems to have very little to do with fear of inflation or political instability and much more to its continual promotion on radio and TV. You can sell almost anything if you promote it hard enough and that appears to be the case with gold. I am very leery of such promotions as they seem very similar to much of the other huckster advertising that is pushed at us. Gold may continue to go up, but it is also quite likely to have a dramatic price collapse.

 

[theconqueror]

I've been watching this gold thing for several years now. The dramatic rise in the price of the metal seems to have very little to do with fear of inflation or political instability and much more to its continual promotion on radio and TV. You can sell almost anything if you promote it hard enough and that appears to be the case with gold. I am very leery of such promotions as they seem very similar to much of the other huckster advertising that is pushed at us. Gold may continue to go up, but it is also quite likely to have a dramatic price collapse.

Because once upon a time Gold had something to do with the value of currency, now it's only a metal just like copper or silver with no relation or value whatsoever to what our currency is worth. shame.

 

[darkbeaver]

forget it

 

[SirJosephPorter]

Because once upon a time Gold had something to do with the value of currency, now it's only a metal just like copper or silver with no relation or value whatsoever to what our currency is worth. shame.

These days gold is just an investment vehicle, like stocks and bonds. There are risks associated with gold investing (and there are corresponding rewards).

 

[theconqueror]

These days gold is just an investment vehicle, like stocks and bonds. There are risks associated with gold investing (and there are corresponding rewards).

Good answer, I've been wondering why anyone would want to invest in Gold unless it's a worldwide value. Investing in a gilt seems more practical.