Wednesday, October 7, 2009

Gold Prices Break Another Record

Gold prices rose to another record high, as it closed at $1,050 a troy ounce, as gold investors at this time are shrugging off the idea that there will be a correction.

Since August the price of gold has soared by over 10 percent, some thinking it is headed for $1,500, and over the long term projections have been as high as $5,000, with Peter Schiff offering that as a real possibility for gold prices.

The continuing plunge in value of the U.S. dollar, along with the fears of inflation, seem to be keeping investors in the gold game rather than taking profits.

Some in the gold industry have looked at the falling demand for jewelry in a number of nations, including India, Italy and Turkey, among others, as a reason to be concerned over the price of gold holding, but in reality, the price movements of gold are far less dependent on jewelry demand than a hedge against inflation and holding on to your money, which in times like we're living in is more relevant.

Jim Rogers has said he wouldn't buy gold while it's hitting record highs, but at the same time he's also not thinking in terms of betting against it either. He's basically waiting for the price to drop and then he'll buy more, knowing over the long term there is a lot of upside for gold before it begins to level out.

Another interesting point is while gold has reached record levels when measured against the U.S. dollar, against other currencies it is still far from reaching its highs. For example, it's 30 percent below former highs against the Australian dollar and 15 percent below highs it has hit against the yen.

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