8/9/11

Is gold a new bubble?

Gold price rockets up as a natural haven during the turbulent financial markets.  It is reflective type behaviour from the past when gold played a very specific role in finances. Currently, gold is a normal commodity with its price fully driven by the market. Therefore, the rocketing gold price likely repeats the trajectory of house prices before 2006. Some experts say that it was a bubble in sense that the house prices were speculative. Gold can not be an exclusion from  "normal" market behaviour . When the market players understand this simple rule the price will plummet down. I expect this fall in 2011 because the negative tendency in economic performace has no alternative and there is  no really safe haven for assets.

No comments:

Post a Comment

The Fed rate will not likely be falling soon and fast

In 2022, we  wrote in this blog  about the strict proportionality between the CPI inflation and the actual interest rate defined by the  Boa...