With the US$ (and other currencies) gaining in strength in the last 36hrs, I’ve been busy answering my phone and emails.
“What’s happening to the ‘price of Gold’?”
I’ve almost given up trying to explain that Gold is a store of stable value and that it is the currencies that are going up and down as measured by Gold. It is because they cannot grasp that point, that they cannot make sense of what is happening. If one understands which is the measure of value and which the measured, then what is happening is rather obvious.
The stock market is foretelling of a glorious future of perpetually rising prosperity. The naysayers have been proven wrong and are belatedly and sheepishly returning to stocks. Under those circumstances, what’s not to like about the US$? Buy, buy, buy! Which means sell, sell, sell – Gold (and silver).
My good friend Serge assures me that the market will stay strong until November. Maybe so. Some things are written in stone, but rarely do such insights include the ‘when’. All we can know is that at some unknown point – maybe tonight, maybe this November, maybe next year:
– the stock market will correct – majorly,
– the currencies will return to their long-term trend of falling in value, (translation for Gold bugs), the ‘price of Gold’ will rise, and
– the dollar price of Gold and silver mining shares will rise sufficient to bring a hint of a smile to my cynical, colourless old lips.