TOKYO, June 9 (Reuters) - Strong physical demand will likely put a floor for gold prices at $870-880 under current market conditions, an official of London-based metals consultancy GFMS said on Tuesday. Levels that draw physical demand will contain investment sector selling, and currently that floor was in the “higher $800s”, GFMS chief executive Paul Walker said at a news conference in Tokyo to brief on the company’s precious metals surveys released in April.
“Sustained disinvestment will not likely push prices below $870-880 as the amount of physical buying out of India and the Middle East” will help support prices at higher levels, he said…
The metals consultancy said in its Gold Survey 2009 in April that gold may rise through $1,100 an ounce in 2009 as investment is supported by fears over rising inflation, potential dollar weakness and fears of financial instability.
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Price predictions are fun and all, but truth be told, the price levels of “paper gold” (futures, ETFs, and other derivatized representations) can theoretically punch around at any given level [perhaps with a bias toward $0 representing a systemic default], but meanwhile, on the actual physical market, there are some formerly commonplace items that remain conspicuously difficult to procure at any modest price.
Let that scarcity be a subtle warning sign. Don’t settle for holding an uncertain/empty bag of paper gold. Choose physical gold and you’ll have the peace of mind of knowing the tangible wealth is at hand at such time as you may need it most.
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