Posted on 04/19/2011 6:40:37 AM PDT by SeekAndFind
Gold extended gains to a record in New York as a drop in the dollar buoyed demand for the metal as an alternative investment.
Futures surged yesterday after Standard & Poor’s revised its U.S. credit outlook to negative. Gold has jumped 5.3 percent this year as the dollar dropped 4.8 percent against a basket of six other currencies including the euro and British pound.
Gold prices may keep rising for “some years into the future,” Blackrock Inc. fund manager Evy Hambro said in an interview with Mark Barton on Bloomberg TV’s “On the Move.”
Gold for June delivery rose $1.60, or 0.1 percent, to $1,494.60 an ounce by 8:20 a.m. in New York after earlier today climbing to $1,498.90. Immediate-delivery gold was little changed at $1,493.93 an ounce in London.
The 14-day relative strength index of gold futures rose to 70.135, above the level of 70 that some analysts who study charts view as a sign that prices are poised to drop.
“$1,500 is definitely a psychological level,” said Mark O’Byrne, executive director of brokerage GoldCore Ltd. in Dublin. “Any correction is likely to be short and shallow, given the very strong fundamentals.”
At current prices, gold is still $900 below the inflation- adjusted level, GoldCore’s O’Byrne said, adding that gold may reach as much as $2,400 in the coming years.
‘Debt Issue’
“The focus has moved to the U.S. sovereign debt issue,” O’Byrne said. “There are very significant risks in the world, that’s why people are diversifying into gold. Before, the U.S. government debt was meant to be risk free. Now that is in question.”
Gold has gained in the last 10 years on increased investment demand for commodities and on concern that currencies may be debased as central banks stimulate their economies.
(Excerpt) Read more at businessweek.com ...
———gold is still $900 below the inflation- adjusted level, GoldCore’s O’Byrne said——
I suppose the base is the $800 high that was a fluke lasting but a few days. The price will rise but the inflation adjusted number is irrelevant to the discussion.
A couple months ago, $50 silver seemed absurd.
Not so much now. ;)
Oh, and if gold had gone up as much as silver did after Urkels election, it would be worth over $4,000 an oz now. That requires some reflection.
RE: A couple months ago, $50 silver seemed absurd
Silver is trading at above $43.00 as I write this. Inching its way towards $50.00
Not sure if the historical gold/silver price ratio has any relevance today...
>>Silver is trading at above $43.00 as I write this.<<
And it is at $43.75 as I write this. I have virtually no doubt that it will hit $100 in the next year or so. Then again, I remember when, back in 2008 I thought the economic crisis could get as bad as the GD and I thought it sounded nuts even as I typed it. So maybe $100 is something it will hit this summer. I have silver, but nowhere near as much as I wish I had.
Gold just touched $1499.
“”I have silver, but nowhere near as much as I wish I had.””
You can fix that, you know.
>>You can fix that, you know.<<
Only by borrowing the money. :(
Last time I checked today, platinum spot was $1776.00. Oh, the irony.
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