Gold Price To Hit $1000 This Week ?

[churchill]

The many predicted price falls have not yet happened . I think we could see $1000 this week but would expect a pull back at some stage but still within a bull run . If you are not already invested in gold I think the gold mining shares are now good value as they have not yet factured in gold's current price rise .

[LivinLOS]

I am also feeling like this is temporarily overbought territory.. I am seeing too many pro bullish news pieces and for my own personal taste I like more fear in a market to ride the wall of worry.. I could easily see an 800 gold price this month as easily as I could see a 1050..

I am still confident that this is a solid bull being fed by the masses of liquidity out there looking for a inflation hedge home that cannot be printed to worthlessness by central bankers.. I feel that theres a basic distrust in paper money coming and still feel gold will be much higher over the next 3+ years. If this does go into the mania phase I think this could be dramatic spikes but not into that territory yet.. Certainly when that does happen make sure sliding stops are in place.

I also feel the mining equity is lagging in its leverage.. Tho that also tells me that the current buying phase may be running on empty.. Either the HUI needs to put in some real performance or gold needs to pullback to set some balance between these two.

Dont forget the masses of gold now finding homes in ETF's and other derivative instruments is much easier to panic sell than old coinage and bullion holdings, so expect much greater volatility and be prepared for scary down days.

Personally I see little security in other stores of wealth, wouldnt mind hedging some of my gains into food commodity's or similar but damned if I want to hold fiat without getting 15 or so % on it (10% in NZD.. Hearing of muni USD at 15 ish numbers.. That does become interesting).

[churchill]

How can one buy food commodity's ? Apart from buying a farm /land ?

[sonicdragon]

How can one buy food commodity's ? Apart from buying a farm /land ?

Buy a soft/agricultural commodities fund. I have been advocating this on TV for a long time.

[Naam]

Hearing of muni USD at 15 ish numbers.. That does become interesting.

not interesting at all. journ@sslists who have no idea what they are talking about are confusing their readers by not mentioning that these are short term roll-over yields valid for a few days.

[BigSnake]

The many predicted price falls have not yet happened . I think we could see $1000 this week but would expect a pull back at some stage but still within a bull run . If you are not already invested in gold I think the gold mining shares are now good value as they have not yet factured in gold's current price rise .

[wasabi]

How can one buy food commodity's ? Apart from buying a farm /land ?

http://finance.yahoo.com/q?s=dba

[maxcrc]

In the Chicago Board of Trade you can buy all these futures.

Food futures sometimes can be even more profitable than mineral futures, but it is not my field.

Speculators are waiting for the minimal hint that say (example) Ghana cocoa crop this year has been affected by a mysterious bug and prices will jump like crazy in few days , than they say a ghanian scientis found a antibiotic to kill the bug and prices will come back again from where they were.

It seems this year everything is reaching all times record in dollar terms, even the tea reached its all time peak due to the unrest in Kenya. Now the unrest is over and maybe tea prices will fall again.

Wheat is also crazy expensive and the prediction of many economist is that generally speaking STAPLE FOOD in poorest countries will jump as high as 20-25% this year, which would carry lots of more hunger in the already poorest countries.

After Oil at $100, Palladium at $2000, Euro at $1.50 swiis franc below 1.05, canadian dollar below 1:1, next one could be gold at $1000.

anyway,unless you are a real exppert of this field I would tell you to take care with food futures, they can be even more volatile and unpredictable than mineral, because they can be seriously affected by a sudden atmospheric agent like a flood, hurricane, drought, hailstom, snowstorms (like in Chian this year) or sudden frost in sub-tropical areas.

[LivinLOS]

How can one buy food commodity's ? Apart from buying a farm /land ?

Futures markets.. ETF's.. Stock picking to sectors..

I think the whole ethanol hype is a bit nuts.. I do see energy problems but all they have done is take energy expensive grains and shift the problems around.. They really need to look at renewables and wind solar research harder if they actually want to solve the problems not just shift them. Same goes with all the electric car hype.. Where do they get thier electric from.. Still just moving the problem. Anyway rambled there but with grains, corn, rice, coffee, everything inflating due to too much money supply theres opportunity in those. I ignored advice to be long grains and corn, was solid at the time and although I am happy with my PM performance I am not diversified enough.

[LivinLOS]

Hearing of muni USD at 15 ish numbers.. That does become interesting.

not interesting at all. journ@sslists who have no idea what they are talking about are confusing their readers by not mentioning that these are short term roll-over yields valid for a few days.

Then I may have been caught up in bad information..

I had read that some new issues had been attracting those kind of numbers not only rollovers.. and many new issues being cancelled as the issuers where not prepared to pay the yields..

I have avoided USD based assets like the plague.. But 15% would make me thing.. hel_l a mate has 10% NZD bank accounts !!

[LaoPo]

"Gold Price To Hit $1000 This Week ?"

10 days after OP's question............:

Gold hits $1,000 for first time

See how gold has climbed

The price of gold reached a record, trading at $1,000 an ounce for the first time, pushed higher by a weak US dollar and fears about the US economy.

Concerns about a possible US recession are seeing investors buy up commodities such as gold as an alternative to company shares and the US dollar.

Since the beginning of the year the value of gold has increased by about 20%, after it rose 32% in 2007.

Gold will stay high as long as dollar and growth fears remain, analysts said.

"Every bit of bad US economic data boosts gold in two ways," said Fortis Bank.

"First because it reinforces the return of its role as a safe-haven asset, and second because the dollar falls on expectations of further Federal Reserve rate cuts."

Gold is measured and sold in troy ounces. One troy ounce equals 31.1035 grams or 480 grains. One troy ounce is equal to 1.09711 avoirdupois ounce - those widely used to measure weights in the US and UK.

Short term fix?

The dollar fell further on Wednesday against key currencies, including the euro and Japanese yen.

Graphic of worldwide gold production

At one point, it was worth less than 100 yen for the first time since 1995, while it plumbed new depths against the euro at $1.562.

Analysts are predicting that it could fall further as more details emerge of the losses suffered by banks and hedge funds due to investments centred on the troubled US housing market.

Already many companies have unveiled billions of dollars of losses which has caused credit markets to freeze and has created an environment where there is less money available for consumers and businesses to borrow.

At the same time, there are increasing signs that the US is on the brink of recession.

Official data out on Wednesday showed disappointing retail sales in February.

This has added to the recent drum beat of bad news, including a shrinking of the service sector in January and February, and an unemployment rate that is at its the highest level for five years.

'Cut and inflate'

Despite aggressive interest rate cuts and White House measures to stimulate consumer spending, it is expected that US rates - currently at 3% - will have to come down further.

Analysts said this will weaken the dollar further and accelerate inflation.

"The Federal Reserve is going to cut and inflate our way out of this credit mess and the implications are going to be higher and sustained inflation," said Ichael Darda, of MKM Partners.

"That's been signalled by not just gold but by virtually every commodity and the dollar."

The oil price surged to a fresh high above $110 a barrel earlier, while agricultural commodities, including cocoa and coffee, also rose.

http://news.bbc.co.uk/2/hi/business/7294040.stm

30 years of gold highs and lows

http://news.bbc.co.uk/2/hi/business/7284184.stm

LaoPo

[AlexLah]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on.

You could have made a nice 40% profit in just one year.

End of this year it will be 20.000.

Now it is around 15.000

Nuff said.

[Naam]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on.

You could have made a nice 40% profit in just one year.

End of this year it will be 20.000.

Now it is around 15.000

Nuff said.

but birds are still sh*tting on your car, aren't they?

[peter991]

How are Thai gold shops are being affected by the rise in price? They post their daily price which seems to climb with monotonous regularily - reflecting the rising price of gold.

Are Thais still buying gold necklaces and braclets in high numbers? Or have they cut back from 20, 10 and 5 baht chains to the 1 and 2 baht chains?

Peter

[LivinLOS]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on.

You could have made a nice 40% profit in just one year.

End of this year it will be 20.000.

Now it is around 15.000

Nuff said.

but birds are still sh*tting on your car, aren't they?

However now I can afford to have one of my minions to clean it

[BigSnake]

[jonniebkk]

All commodities are very speculative right now. Sure you can make good money if your timing is perfect...or you can loose allot if you're off just a little bit.

Gold demand in India (the biggest jewelery market for gold) has been going down the past couple years due to its high price. So one of the main markets for the metal has been deteriorating. Sure, speculators will continue to pile in driving the price up but later or sooner it's gonna fall back to earth.

Also, gold is unique among commodities for the following reason: Unlike most all other commodities, it is not consumed (used up) in any real sense of the word when it is sold. Also, the industrial demand for the metal is very small (so not much inherent demand to support a high price). It is used as a store of value...there is really no practical use for it and therefore, no real end market to support long-term high prices. With just about all other commodities (base-metals, grains, oil, etc.) they are actually consumed/used by some market. That is, they cease to exist after being used and more has to be grown or mined. Therefore, real world shortages of these commodities can and do occur.

Keep in mind that there is really no shortage of the gold....its price run-up is driven purely by financial speculation. Remember, just about all the gold that has ever been mined from the earth still exists in one form or another. Even the gold mined by the Egyptians 2000 years ago still exists in the Cairo museum in the form of the death masks of the Pharaohs. So in some ways, the world is awash in gold and even when it is "used" in a jewelery product, it still exists as gold and therefore, the gold market has not lost any of the metal so to speak.

Remember those who bought in the last round of gold fever, when it was around $ 800 an ounce and many were predicting it would go to $ 2000 then too, had to wait 20 years to even break even again.

[VegasVic]

All commodities are very speculative right now. Sure you can make good money if your timing is perfect...or you can loose allot if you're off just a little bit.

Gold demand in India (the biggest jewelery market for gold) has been going down the past couple years due to its high price. So one of the main markets for the metal has been deteriorating. Sure, speculators will continue to pile in driving the price up but later or sooner it's gonna fall back to earth.

Also, gold is unique among commodities for the following reason: Unlike most all other commodities, it is not consumed (used up) in any real sense of the word when it is sold. Also, the industrial demand for the metal is very small (so not much inherent demand to support a high price). It is used as a store of value...there is really no practical use for it and therefore, no real end market to support long-term high prices. With just about all other commodities (base-metals, grains, oil, etc.) they are actually consumed/used by some market. That is, they cease to exist after being used and more has to be grown or mined. Therefore, real world shortages of these commodities can and do occur.

Keep in mind that there is really no shortage of the gold....its price run-up is driven purely by financial speculation. Remember, just about all the gold that has ever been mined from the earth still exists in one form or another. Even the gold mined by the Egyptians 2000 years ago still exists in the Cairo museum in the form of the death masks of the Pharaohs. So in some ways, the world is awash in gold and even when it is "used" in a jewelery product, it still exists as gold and therefore, the gold market has not lost any of the metal so to speak.

Remember those who bought in the last round of gold fever, when it was around $ 800 an ounce and many were predicting it would go to $ 2000 then too, had to wait 20 years to even break even again.

jonniebkk, I couldn't have said it better myself, in fact I may have posted some of this (and more ) before. There is currently a substantial speculative premium in the oil markets ($20-$25/bbl), however oil is a finite commodity growing in demand that actually gets used up after it is purchased. On the other hand as you so astutely posted every ounce of gold ever mined in the history of the world is still with us, because gold does not decay, corrode or get "used up" in any other way, and while industrial demand for gold use to be around 12% of the market, but it has been declining for a few years now so I wouldn't be surprised if it was 10% at present. I could say that gold also had a large speculative premium in it presently, but that would be one of the great understatements of all time. As you know there are no fundamental reasons behind the rise in gold, the gold market currently is a textbook example of a bubble, in other words its a working model of the greater fool theory. A couple of weeks ago I called for a blowoff top in the gold market and posted that while gold might very well pop to $1000/ounce or slightly higher in this current frenzy, that the time is getting near for golds bubble to burst. Well guess what, gold was down $60/ounce today, and while there will still be some volitility in the gold market the bias is down from here, as a matter of fact I wouldn't be too surprised to see gold down $100/ounce on a single day sometime over the next two months. I recently followed the hordes of people worldwide who are emptying their jewelry boxes and safe deposit boxes and selling their gold jewelry and coins into the height of this bubble, if I choose to I will just buy back my colection of $20 gold coins later this year at 60-70 cents on the dollar Anyway, kudos to you jonnie for posting a concise and common sense explanation of the irrational gold bubble, I hope you are not assailed to brutally by the many gold bugs here on T.V.!

[ray08]

The gold price is 100% speculative and nothing to do with physical demand, Italy one of the the largest Jewellery producers is in tatters , especially on the gold chain market which is the volume end of the market , over the past few years factories i kow have gone from

33 tonnes- 18 tonnes chian a year

22 tonnes - 10 tonnes

12 tonnes - near bankrupt

yet the the physical price has gone up , the experts try to talk about physical demand in India , all rubbish , as for safe haven , well if the world crashes and we need gold bars as currency we are all in deep S@#T ,

Now gold has dropped almost $100 in 2 days , where will it go now , toss a coin and pick , i think a lot of stop loss selling has just happened , it might crawl back up ,but as i said before ,all you need is a excuse like America not going into Recession and USA economy turning around and you could see people dump gold overnight and jump into USD$

The gold price 10 years ago was around $280 at one stage , I remember that at around $300 or less it was not worth mining , i believe the true value of Gold is around $400 per ounce , based on physical demand , and abundance of gold underground , plus you can refine old gold ,

I notice a few people on this forum looking at getting into gold , very dangerous commodity to play with ,I have been buying gold for 20 years and i still have no idea where it will end up , i think down , but market forces determine the price, eg hedge funds , pension funds , not mere mortals like us

Edited March 20, 2008 by ray08

[simcity]

Gold is cool to go for, when your finance is in order with a good mix investment secures.

They said; do not put all your eggs in the same basket!

Gold just give the glitter of the overall and it is a extra peace of mind someone can get!

[VegasVic]

The gold price is 100% speculative and nothing to do with physical demand, Italy one of the the largest Jewellery producers is in tatters , especially on the gold chain market which is the volume end of the market , over the past few years factories i kow have gone from

33 tonnes- 18 tonnes chian a year

22 tonnes - 10 tonnes

12 tonnes - near bankrupt

yet the the physical price has gone up , the experts try to talk about physical demand in India , all rubbish , as for safe haven , well if the world crashes and we need gold bars as currency we are all in deep S@#T ,

Now gold has dropped almost $100 in 2 days , where will it go now , toss a coin and pick , i think a lot of stop loss selling has just happened , it might crawl back up ,but as i said before ,all you need is a excuse like America not going into Recession and USA economy turning around and you could see people dump gold overnight and jump into USD$

The gold price 10 years ago was around $280 at one stage , I remember that at around $300 or less it was not worth mining , i believe the true value of Gold is around $400 per ounce , based on physical demand , and abundance of gold underground , plus you can refine old gold ,

I notice a few people on this forum looking at getting into gold , very dangerous commodity to play with ,I have been buying gold for 20 years and i still have no idea where it will end up , i think down , but market forces determine the price, eg hedge funds , pension funds , not mere mortals like us

Great post as always Ray! The only point that I might take you to task on is the true value of gold, the true market value is probably closer to $350/ounce, as the cost to bring it out of the ground and to market is around $250-$275/ounce (this will vary among producers, some can do it cheaper and for some the extraction costs are a bit higher) so given a 30% profit margin the true value is somewhere in the mid $300's. We have seen this insane escalation because of people hording gold thinking that a worldwide colapse is near, rabid speculation based on no fundamentals at all just the greater fool theory, and a weakening U.S. dollar. As the U.S. markets work through this slowdown and the dollar makes its inevitable U turn, I fully expect that gold will be far closer to $600/ounce than $900/ounce by years end, and two years out it will likely be sub $500/ounce once again.

[jonniebkk]

If one is a long-term prudent investor (as opposed to a trader/speculator, and there is nothing wrong with this if it is your wont) gold has its place in a balanced portfolio. Physical gold, gold mining company shares, or gold certificates/funds should make-up 5-10 percent of one's holdings. Basically, it is to smooth out one's returns. As we have seen the past year or so, during periods of inflation or financial market turbulence gold will rise in price while financial (paper) assets will generally fall. The rise is gold will make-up for some/all of the fall in the portfolio's value due to the decline in its paper assets component. The goal being to maintain the overall value of the portfolio...even during periods of financial market distress.

During periods when the price of gold is high, or it percentage of the portfolio becomes greater than 5-10%, the excess should be sold (and maybe a little more). It can be brought again when the price inevitability declines to historic norms. In this way, gold is useful to smooth out the ups and downs of one's portfolio due to market volatility.

[jonniebkk]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on. You could have made a nice 40% profit in just one year.

End of this year it will be 20.000. Now it is around 15.000

Come on all you gold bugs...were r u now As of early Thursday morning trading in US, gold (and oil) are already down 10% from recent highs! All the speculative money that have been in these trades (at God only know what amount of leverage) will have to unwind these trades pronto...wouldn't want to be the one trying to catch a falling knife

[VegasVic]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on. You could have made a nice 40% profit in just one year.

End of this year it will be 20.000. Now it is around 15.000

Come on all you gold bugs...were r u now As of early Thursday morning trading in US, gold (and oil) are already down 10% from recent highs! All the speculative money that have been in these trades (at God only know what amount of leverage) will have to unwind these trades pronto...wouldn't want to be the one trying to catch a falling knife

The pain continues for the gold bugs Will gold dip back below $900 tomorrow, or will there be a dead cat bounce? Stay tuned in here to your thaivisa gold channel to find out the latest on golds fall from grace

[britmaveric]

Be honest - gold isnt a needed commodity. If it went way tomorrow - would anyone care???? (apart form commodity traders)

[keeshou]

Be honest - gold isnt a needed commodity. If it went way tomorrow - would anyone care???? (apart form commodity traders)

You can't be erious. How many electronic parts are plated with gold? Circuit boards, Semi conductors and resistors usually are plated with gold to prevent corosion. Since gold is the most durable metal in existence and nothing can corrode it, it is used to protect other metals that will corrode and in the fillings of your teeth or the rooftops of important buildings (well those who build it think so) and maybe even on your wife's finger (unless you think she'd rather have copper).

[shochu]

vic,

since your gloating - i'll give you something to chew on!

unloaded about 1/3 not too long ago which in effect pays for all the remaing stuff I hold - essentially free - and also pretty much pays for the condo at a major discount!!

will hold the rest and as per usual - will pick up an amount every year or every so often depending on the price at the time (as the money would just go into an account anyways) to be a part of my holdings for either my older years or to pass onto a loved one.

Besides I like the way the bars, coins look and feel.

I collect silver coins too - have some nice old silver ones that were issued in indochina about a hundred or so years ago. No not the imitation stuff - but the real stuff.

have a nice day.

[churchill]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on. You could have made a nice 40% profit in just one year.

End of this year it will be 20.000. Now it is around 15.000

Come on all you gold bugs...were r u now As of early Thursday morning trading in US, gold (and oil) are already down 10% from recent highs! All the speculative money that have been in these trades (at God only know what amount of leverage) will have to unwind these trades pronto...wouldn't want to be the one trying to catch a falling knife

I think most people including " Gold Bugs " know that nothing can keep on going straight up - many are calling this a healthy correction and a good time to buy before it resumes its path . I don't think the fed has or can save the day !

[simcity]

Beginning last year I predicted gold to be around 13.000 Baht end of 2007 and I was spot on. You could have made a nice 40% profit in just one year.

End of this year it will be 20.000. Now it is around 15.000

Come on all you gold bugs...were r u now As of early Thursday morning trading in US, gold (and oil) are already down 10% from recent highs! All the speculative money that have been in these trades (at God only know what amount of leverage) will have to unwind these trades pronto...wouldn't want to be the one trying to catch a falling knife

I think most people including " Gold Bugs " know that nothing can keep on going straight up - many are calling this a healthy correction and a good time to buy before it resumes its path . I don't think the fed has or can save the day !

oil and gold did have a good pull back ok, but the dollar got stronger too, $AU went from .95 to .89 in few days!

it make only a 4% down on the gold for me then.

[muhammad10280]

I still have the gold jewelry from my wedding gifts. I will cash it in before I buy my first house for my family. Hopefully the prices remain at a good selling level until then, god willing.

Edited March 22, 2008 by Maestro
Irrelevant reference to God removed - Maestro