Friday, January 13, 2006

 

Gold Shines As All-Purpose 'Insurance Policy'

CNN Money reports on the days metals markets. "Gold awoke from a week-long slumber to hit a new 25-year peak on Friday as investors actively bought metals again, pushing platinum to its highest level in nearly 26 years. After starting the week setting new highs, gold traded quietly until late on Friday afternoon when it suddenly jumped 1.5 percent to score a fresh peak of $556.50."

"Platinum, used mainly to clean auto exhaust emissions, rose largely on speculative buying, although worries about supply are also a support to the market, dealers said. 'The recent move above $1,000 is mostly driven by speculative buying,' Barclays Capital said in a report."

"Platinum demand has now outstripped supply for eight straight years, thanks to robust consumption by car manufacturers in Europe where diesel engines continue to gain market share. Until recently, only platinum could be used for both diesel and gasoline catalysts."

"Silver was hot on gold's heels, gaining just over two percent to $9.20 from $9.00. 'I hear there is some quite good buying in investment products and we are seeing very good demand for bars here,' one German trader said."

"Investor interest in exchange-traded gold funds (ETFs) has soared since the end of 2005. These products, traded on some of the world's major stock exchanges, give investors a share of a bar of gold. Analysts estimate the five ETFs now hold some 384 tons of gold, equivalent to the gold reserves of Russia."

"'Gold is more and more becoming an insurance policy against any type of disruptive risk and most portfolio managers believe that gold is an asset which should not be missed in their portfolios,' Frederic Panizzutti."

Comments:
It's nice to see some currencies get back in line with gold.
 
"'Gold is more and more becoming an insurance policy against any type of disruptive risk and most portfolio managers believe that gold is an asset which should not be missed in their portfolios,' Frederic Panizzutti."

It's always been an insurance policy! Gold should be considered a wealth preserver. As the price of PM'S rise all sorts will come out of the wood work proclaiming what a great investment they are. When for the past 20+ years they have vehemently proclaimed them to be barbarous. Funny how fast the tide can turn, when there's money on the table...
 
P.S. I should have said gold has been a wealth preserver for more than 5000 years.That's good enough for me. Name a paper currency that can lay that claim...
 
According to http://www.truecontrarian.com/ gold mining shares will drop 28% by May. This guy also believes in the house market bust (which is in line with my thinking so that's why I'm giving this some credibility). His reasoning is due to charting only (out of line with 200-day moving average). He also think gold itself will fall to $450.

Maybe he and I just differ on metals since I think Gold will hit $680 by year end.
 
Out at the peak said...
His reasoning is due to charting only (out of line with 200-day moving average). He also think gold itself will fall to $450.

Maybe he and I just differ on metals since I think Gold will hit $680 by year end.

4:56 PM


If gold were to pull back into the mid-4's I would buy,buy,buy. I do believe we will see some pull backs. I also agree that by years end gold will be closer to $700.00 than $500.00. I also think Silver will be near $15.00. It is going to be an interesting year no doubt...
 
You're all correct.

Gold has risen too far too fast, and therefore will inevitably correct. However, the long term trend is up, and all pullbacks are simply another opportunity to accumulate.

If I were a braver man, I'd play the gold ETFs on these short-term gyrations.
 
If I were a braver man, I'd play the gold ETFs on these short-term gyrations.
# posted by TJ & The Bear : 2:51 PM

You and me both! I do intend to muster up a little more courage this year though. I have a feeling there are going to be some wild "gyrations".
 
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