Sumarokov

I am increasingly convinced that gold is acting as a currency. In which case, is it right to constantly watch its price in US dollars? Should one not be looking at how it is doing in the "next best currency to gold"? Against the euro, I can tell you that it is going nowhere right now...

Gold has been increasing in price quite steadily recently, but I say it is only when you look at the price in US dollars, a currency which has been falling against the euro. I think the price of gold is actually static right now, and ought to fall when the euro/dollar reverses its movement. For some reason, it is this staticness that worries me more than the recent volatility. No movement is more worrying and ominous to me than wild movement, because at least wild movement means the thing is alive...

Personally, I think there is never a bad time to buy into gold...

Yes, thank goodness for the rise of the east, and the gold-loving Chinese and Indians! Historically, were the Chinese not on a silver standard? I know the Chinese have long memories, and wonder if this might be their metal of choice when, after they have caught up with the USA in military terms (20-30 years' time), they launch a parallel metal-backed form of currency?

It seems to be very stubborn in its refusal to drop even the slightest cent below $1600. I think the recent prices have become fixed in the minds of many, with an eye onto eventually approaching and passing $2000, that anywhere around the low $1600s seems to find buyers (price sentiment). I think the manipulation has failed, but there may still be drops if there is an enormous brief flight to dollars when Greece defaults, the stock markets bottom out, there is a general European-wide run on banks... But even if you bought at the peak, say at $1900, you are still better off, because that way you got something (gold) for nothing (fiat money). In fact, I would say fiat money is actually less than nothing, because of the commission collected by the central bank...

Short-term - lower, long-term, higher. $1400 is a number that is being bandied about. I am a natural pessimist, so I see it going that far before the year end. There are steady climbs followed by big sell-offs, suggesting big boys unloading gold, while the little people pick it up. Very long-term, it can only go to the moon, as fiat money gradually heads to its ultimate value of complete zero. Or does anyone suggest we are not going to see $1900 ever again in the future??

http://www.youtube.com/watch?v=zUlRldVTgdY