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Friday, July 31, 2015

Gold Is Only Going to Get Worse

The problem for gold isn’t just that prices are dropping. For many, the metal also has lost its charisma.

Sentiment means a lot in the bullion market, where only about 60 percent of what gets mined or recycled each year is used in jewelry and industrial applications. The rest is sold as coins or bars, so when demand from investors dries up, there can be painful consequences for the bulls who remain.

Prices will drop to $984 an ounce before January, according to the average estimate in a Bloomberg News survey of 16 analysts and traders. That would be the lowest since 2009 and a 10 percent retreat from Tuesday’s settlement. Speculators are shorting the metal for the first time since U.S. government data began in 2006, and holders of exchange-traded products are selling at the fastest pace in two years.

“Gold is out of fashion like flared trousers: no one wants it,” said Robin Bhar, an analyst at Societe Generale SA in London. “It’s not going to collapse, but we think it is going to be at a lower level in the not-too-distant future.”



Anonymous said...

Mmm hmm, go ahead and sell. Take there advice, it won't go back up.

Anonymous said...

The big international banks are keeping the price artificially low, when the stock market crashes in late September people holding the metal will be the ones holding real assets.

Anonymous said...

But flared trousers are so cool!

Anonymous said...

Hey 8:14 - since you can tell the future, then it's time to get rich! Sell the broad market indexes short right before the crash. You'll make a fortune.

Anonymous said...

The stock market is controlled.

Anonymous said...

When my parents were young adults(late 60's early 70's), Gold was under $50 an ounce. Now, it's over $1,000. While you can certainly beat such an investment in the stock market, gold has a place in anyone's portfolio.

I'll happily buy a few more thousand ounces of silver once it get's back down near $5/ounce. I made a killing selling the last silver boom.