Any immediate explanation for the recent strength in gold?

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Lemonyellowschwin's picture
Lemonyellowschwin
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Any immediate explanation for the recent strength in gold?

PMs were strong yesterday in the face of a big stock selloff, and are very strong today even with the market flat.  The dollar gained yesterday and is weaker, but not outrageously so, today.

Is there some news item that I missed, or other readily obvious explanation?

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Doug
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Re: Any immediate explanation for the recent strength in ...

I have no information, but I suspect its fear about banking failures combined with expectations of a market downturn.  Even the bulls on CNBC are predicting a "pull back" or correction.  I think people just don't have any faith that the recession is really over.

Doug

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Davos
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Re: Any immediate explanation for the recent strength in ...

Any immediate explanation for the recent strength in gold?

Recent?

I purchased some gold in 2002/2003. I held some dollars from then also. Gold can by as much of anything (gas, food, etc) then as today, the dollar can't.

Strenth?

I think gold is more a store of value. I think where people,,,have a different view,,, is they may not look at the dollar as a store of value. Worse, since all fiat currencies stink and all are falling together they may not notice what is going on even though it is right beofre their eyes.

I don't think gold goes up or down. They don't mine, they can't mine enough of it.

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Montana Native
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Re: Any immediate explanation for the recent strength in ...

This story could have more to do with the price move than anything.

http://www.reuters.com/article/marketsNews/idUSPEK1183220090831

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Lemonyellowschwin
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Re: Any immediate explanation for the recent strength in ...
Davos wrote:

Any immediate explanation for the recent strength in gold?

Recent?

I purchased some gold in 2002/2003. I held some dollars from then also. Gold can by as much of anything (gas, food, etc) then as today, the dollar can't.

Strenth?

I think gold is more a store of value. I think where people,,,have a different view,,, is they may not look at the dollar as a store of value. Worse, since all fiat currencies stink and all are falling together they may not notice what is going on even though it is right beofre their eyes.

I don't think gold goes up or down. They don't mine, they can't mine enough of it.

Davos,

Gold went up recently (like in the past two days) compared to anything you might want to buy in dollars.  That's called "recent strength."

And, while I sort of like your philosophy, gold surely does go up and down.  Compared to my mortgage, tuition, insurance and other fixed (or semi-fixed) expenses anyway.

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Davos
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Re: Any immediate explanation for the recent strength in ...
Lemonyellowschwin wrote:

Compared to my mortgage, tuition, insurance and other fixed (or semi-fixed) expenses anyway.

I'm hopeful those will go away with only a sliver of your PMs.

PS

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keelba
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Re: Any immediate explanation for the recent strength in ...
Davos wrote:
Lemonyellowschwin wrote:

Compared to my mortgage, tuition, insurance and other fixed (or semi-fixed) expenses anyway.

I'm hopeful those will go away with only a sliver of your PMs.

PS

 

Personally, I wouldn't be hopeful. I don't care if the price of gold goes up or down. I don't watch it go up and think, "Woohoo!! I made XX dollars today!" I do, however, watch the price of gold very carefully because I look at it as a barometer of our economy just the same way weathermen watch real barometers. When I see the gold price shoot up like it is doing I tend to get a little nervous. When it breaks $1,100 I will get very nervous. And when it breaks $2,000 I'm hoping I have all of the food stuffs and water supplies I'm going to need to survive. The reality is, I'd rather see the price stay right around where it is.

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Farmer Brown
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Re: Any immediate explanation for the recent strength in ...

LYS:

Besides general fears over a financial meltdown, it could very well have something to do with the sharp drop in Asian equities.

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JAG
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Re: Any immediate explanation for the recent strength in ...

Today's breakout in gold does appear rather bullish, but it might just be a head fake (false breakout). I'm inclined to think it is the later scenario, but sentiment does seem favorable to neutral, so who knows at this point? 

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Davos
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Re: Any immediate explanation for the recent strength in ...
keelba wrote:
Davos wrote:
Lemonyellowschwin wrote:

Compared to my mortgage, tuition, insurance and other fixed (or semi-fixed) expenses anyway.

I'm hopeful those will go away with only a sliver of your PMs.

PS

 

 

Personally, I wouldn't be hopeful. I don't care if the price of gold goes up or down. I don't watch it go up and think, "Woohoo!! I made XX dollars today!" I do, however, watch the price of gold very carefully because I look at it as a barometer of our economy just the same way weathermen watch real barometers. When I see the gold price shoot up like it is doing I tend to get a little nervous. When it breaks $1,100 I will get very nervous. And when it breaks $2,000 I'm hoping I have all of the food stuffs and water supplies I'm going to need to survive. The reality is, I'd rather see the price stay right around where it is.

When, not if, the dollar goes there will be the haves and the have nots. When it goes I suspect it will come like a thief in the night. I was apprehensive when they were borrowing 800 billion a year. Now we are printing twice that. The money is in the system becuase we take in 2 trillion and pay out 4 trillion.

Like Enron, we are insolvent.

Bernake is counterfieting massive amounts of funny money and hanging them all over the country. The writing is on the wall. Gold won't go up. The dollar will, like Zimbabwe's be worthless.

The only thing I can see MAYBE saving his but for a short term is if the market tanks and people move trillions from equities to securities. But if the banks go first I don't see that happening.

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