All That Glitters Isn't Gold

Following seven straight days of declines (opposite of the dollar) capped off with a 3.8% drop today, Gold closed at its lowest levels of 2008 ($825.00).  The yellow metal is now down 17.9% from its March 18th closing high, and less than $22 above the 20% threshold for a bear market.

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Comments

[User 30121:]

Okay, so??????

Talk to us gold bulls about this topic in 3 months....when the dollar has moved from the front to the back of the toilet bowl, and gold is reaching for NEW HIGHS!
All one has to do is take an impartial look at the current economic situation, and the moronic puppets in charge...puhleeeze!

2008 Aug 12 09:41 AM

[arwerth:]

co incidental isnt it .dollar rallies ivan(russians) walks into georgia.after seeing oil hit 115.this is another example of market manipulation this time by ivan whom for now had finished dumping his t bills for now.thus the the dollar bounce .ivan is clever he has paid off his debts is loaded with commodities and weapons.he will soon resume dumping his t bills buying gold and chopping oil pipe lines and turning the oil spigots to slow.we will pay for our apeasement and double standards.welcome to the new cold war.the retro seventies scenario is now complete.this is a true bear rally our russian grizzly is back.you know what to do .so do it

2008 Aug 12 04:01 PM

[JasonC:]

Next stop the $600 to $700 area, making the right shoulder of the standard peak formation. And stuck there in a trading range for 6 months or more.

The Fed simply isn't printing, and for most entities spreads are so wide the present rate environment is neutral, not stimulative. (Mortgages near 6.5%, medium term IG corporates around the same, etc). Very low short rates are available pretty much only to the banks, which need to rebuild their balance sheets. Even banks' blended cost of capital isn't low, since their debts and preferreds are yielding 7.5% and 9% respectively.

If the Fed has been printing hand over fist the gold story might have legs, but it hasn't been. M1 hasn't moved in 3 1/2 years. Not the stuff hyperinflations are made of. Gold will probably hold one double above its typical 1990s value, at least for the intermediate term. If the gold longs are lucky...

2008 Aug 12 04:06 PM

[Francis Sch...:]

A lot of negative sentiment about Gold should make it fly into Autumn and Winter. Also, many still think the Dollar has to come down for Gold to go up. It sometimes does, however in the past Gold and the Dollar have now and than gone up in tandem. Speaking about Head and Shoulder formations, it is amazing that such a formation is only visible on the Dollar chart for Gold. The Yen, Sterling, Swiss and euro charts look completely different and seem to sit happely in their secular uptrend channel.

2008 Aug 12 05:33 PM