Gold above 1200$ an ounce in 2009?

Due to our current finnacial crisis I believe traditional indicators have little validaty. We have never faced anything similar to this crisis. Our markets are in disarray.As an example ,the dollar's strength makes little sense to me (I have heard all the arguments).Anyway, I think this is the calm before the storm in the dollar (a crash is coming). I have made more money trading markets using some old fashion common sense as apposed to any technical system. In this csae Gold should retrace (profit taking and traditional trendists) but ultimately should trade much higher. Generally, I am very happy (at any given time) to be long gold and crude oil and short the S&P.

 

If they go to a Gold standard then it will be handled as before with a fixed exchange rate. It will not be freely traded. The last value when used to support currencies was $35 per oz.

Anyone who is speculating in Gold doesn't understand that if it becomes a basis again for currency then it will have a set exchange rate of probably $350-400 per oz, hosing anyone who bought at these prices today.

Best thing for Gold bugs is for it not to be made the basis of exchange. Just alway have the threat of it.

John

 

Considering all the cash the treasuary is creating, going back to the Gold standard seems as unlikely as ice in hell...

 

@cunparis

thanks!

 

this would have no credibility and no one would be willing to accept dollars at that gold rate. ie all the gold would be driven out of the fed/treasury's hands in days. money supply has gone up much much more than ten fold in the years since the gold standard convertibility of $35 or $42/ ounce. And the government's reserves have fallen sharply.

 

.....

 

Astonishing but flys with what I have seen.....

 

My pleasure. I'm glad you found it useful.

 

You guys think we can spike trough or first some profit taking?

Cheers.

 

Either is possible, but I'm hoping we get a pullback, because I want to get a better entry point on going extremely long on silver futures.

I don't think there can be any question, given the fundamental factors going on now, precious metals are set to fly. In fact, I believe that they (along with gold mining shares) will be the next bubble, and we'll see their prices quickly go parabolic, just like we did with treasuries, oil, RE, etc.