Bush worries start rush for gold

[emad]

Steve Hawkes, Evening Standard
9 November 2004

GOLD is set to test the key $450 barrier in the coming weeks as concerns over the weak US dollar following last week's re-election of President Bush send investors rushing for the safe-haven metal.

Analysts believe the psychological mark is well within reach after seeing the dollar slump to a record low against the euro. Mine production is also down this year as demand climbs.

Gold hit $435 an ounce in Asia yesterday, its highest since 1988 when $450 was last breached. The recent spurt has taken the average gold price this year to $403.62, up almost 13% on a year ago.

Simon Village, managing director of London-listed Gold Bullion Securities, said: 'Since the US election, traders are looking at the fundamentals and have put the bet back on, long on gold, short on the dollar. I believe we will hit $450 by the end of the year. We could be there in two to three weeks.'
More:

http://www.thisislondon.co.uk/news/business/articles/timid84453?source=

[htuttle]

1. Did the gold derivatives ever get 'unwound'?

I remember hearing a few years ago about a massive pyramid of gold derivatives that central banks had set up -- mostly based on the concept of 'leased gold'.

At the time, there was a fear that a significant rise in the price of gold would cause this whole pyramid to collapse, with fairly dire consequences.

NOTE: I did not read this on a 'gold bug' site. It was a more mainstream economic review -- maybe Business Week (don't remember for certain).

[GiovanniC]

2. BUT... BUT... I Thought Investors LOVED

Smirky McDeficit

[Atlas Mugged]

3. My significant other....

...is a very successful stock broker - and he's been buying gold for the last several months. He's also currently in Germany setting up a bank account in Euros. So, yes, I'm very familiar with this trend.

[emad]

4. Obviously done a whole lot better than UK's Chancellor Gordon

Brown who sold off huge British stocks of gold when they were sitting at roughly $200+ per oz because he said there's no future in speculating on its potential price increases................

[KurtNYC]

6. I'm holding Euros and Canadian

My loonies are up 7% since I bought in July.

[mom cat]

5. Gosh, how convienient..Poppy Bush and Barrett Gold..Who profits?

Who loses? Nothing to see here...just move along. :evilfrown:

[Sven77]

7. cant go to a gold backed dollar

from the video "the money masters"

Beware of calls to return to a gold standard. Why? Simple. Because never before has so much gold been so concentrated outside of American hands. And never before has so much gold been in the hands of international governmental bodies such as the World Bank and International Monetary Fund. In fact, the IMF now holds more gold then any central bank.

http://users.cyberone.com.au/myers/money-masters.html

[HamdenRice]

8. Poor, silly South Africa

In the past, strong gold prices have been excellent for South Africa, because it is the world's largest producer of gold.

Unfortunately, after the Mandela administration, the government was taken over by neo-conservative free marketeers, who tied the Rand to the dollar. I read recently that every gain they make in higher gold prices is offset by an almost equal and equivalent loss in the forced decline of the Rand/dollar.

[DavidDvorkin]

9. Rand is up against the dollar

So it can't be tied that tightly.

When the Rand was created, it was tied to the pound. Maybe they could tie it to the Euro now.



Business Secrets from the stars, a novel - http://www.dvorkin.com/bizstars

[angel823]

10. gold etf's

Does anyone have any information about how to get in on the newly offered gold etf's? I've already moved my 401k account to overseas bonds and market accounts and wanted to invest some savings in gold etfs. thanks.