Thursday, November 5, 2009
Gold is the favorite commodity in the Zehner household. No I wish it was because of all the lovely jewlery I have, but rather it is the investment/trade that my husband has embraced for a long time, mainly because of his negative views of the US dollar combined with his inflationary outlook. I have written about Gold before, but what is noteworthy this week is that it has hit new highs. I just checked the price it is at $1090. For all things GOLD check out JSMINESET . Here is what David Rosenberg has to say about recent performance -
"With the dollar soft, commodities are firming with oil breaking above $80/bbl and on its way for a third winning session in a row; the metals are following suit. Gold has broken out yet again and is up another 1% so far today as it begins to challenge the $1,100/oz mark (according to unofficial IMF estimates, the Reserve Bank of India bought gold at $1,045/oz. With the size of the purchase (8% of annual mined production) and at that price it certainly helps establish a floor! The fact that the yellow metal is accomplishing this with ongoing deflationary developments — Euroland PPI came out for September and showed a 0.4% MoM decline and a -7.7% YoY trend — suggests that other factors are driving bullion to new bullish heights. It’s called scarcity of supply relative to fiat currency. "
Are we still bullish? Yes.