Seeking Alpha

Gold higher amid Yellen testimony; eyes $1,300

  • Also enjoying the Yellen testimony (and her tenure thus far) is gold, ahead another 1.2% and $10 shy of taking out $1,300 per ounce for the first time since early November.
  • The QE exit is easier said than done, says Peter Boockvar. "I remain of the belief that just as QE helped markets in 2013, the reduced pace of it will be the headwind in 2014 which will eventually lead to a QE pause that will prove to all that the Fed is stuck in this vicious cycle of ease."
  • "3.5%, 21%, 38%," writes Barron's Brendan Conway, tallying (in order) today's gain in the gold miners (GDX), the YTD gain in the gold miners, and the YTD gain in the highly speculative junior silver miners (SILJ).
  • Related ETFs: GLD, GDX, GDXJ, NUGT, IAU, DUST, PHYS, SIL, SGOL, UGL, DGP, GLL, GLDX, DZZ, UGLD, DGL, SLVP, JNUG, DGZ, AGOL, GLDI, RING, DGLD, GGGG, SILJ, PSAU, JDST, TBAR, UBG
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Comments (33)
  • Ruben12345
    , contributor
    Comments (517) | Send Message
     
    I just dont see the growth to support current stock valuations. We're not talking about a few jobs created, that can easily be manipulated.
    11 Feb 2014, 12:18 PM Reply Like
  • bbro
    , contributor
    Comments (10588) | Send Message
     
    I have full confidence when Gold drops... the bugs will blame her....
    11 Feb 2014, 12:19 PM Reply Like
  • DeepValueLover
    , contributor
    Comments (9808) | Send Message
     
    Or people are taking profits.

     

    Or interest rates start to rise again.

     

    Or Yellen, against all signs of her nature, refuses to end the decrease of the Fed balance sheet expansion and begins to actually shrink the balance sheet sending rates back up. (I support this course of action).

     

    Or a massive cache of not-to difficult-to-mine gold is found somewhere.

     

    Or some central bank dumps massive amounts of gold on the market.

     

    Or a surprise audit of Fort Knox and the NYFRB shows that there are indeed the # of bars there as they've claimed all along.

     

    Personally, I'd love to see gold back down ~$750 so I could back up the truck but that ain't gonna happen anytime soon.
    11 Feb 2014, 01:38 PM Reply Like
  • bbro
    , contributor
    Comments (10588) | Send Message
     
    Or 79 year old Elvis is found alive in Kalamazoo....
    11 Feb 2014, 03:01 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4221) | Send Message
     
    Or bbro becomes bearish.
    11 Feb 2014, 07:27 PM Reply Like
  • LeahyInvestor
    , contributor
    Comments (103) | Send Message
     
    Gold will repeat history, this is really an outlier period. The 70s had gold rise to 1000 and then dropped like a rock after. The range 400 to 800 makes sense to me, once people aren't in fear mode like they are today. We do not need full employment to grow. Full employment might be condsidered horiable for companies that have to pay higher and higher for lower skilled labor.
    11 Feb 2014, 09:58 PM Reply Like
  • bbro
    , contributor
    Comments (10588) | Send Message
     
    In the fullness of time....
    12 Feb 2014, 12:45 AM Reply Like
  • DeepValueLover
    , contributor
    Comments (9808) | Send Message
     
    Was "fear mode" happening in 2004 and 2005?
    12 Feb 2014, 10:15 PM Reply Like
  • divinecomedy
    , contributor
    Comments (463) | Send Message
     
    Does not matter, as long as the money keeps flowing, this party can keep going.
    11 Feb 2014, 12:20 PM Reply Like
  • howard26
    , contributor
    Comments (247) | Send Message
     
    I kinda think all asset classes will go. S&P soon. And, because margin buying is at an all time high, when called, people will have to liquidate other assets to pay. Other assets? Yep, one of them will be PM's. Fed intervention or no.

     

    Disclaimer: Been wrong before and I am sure it won't be the last.....
    11 Feb 2014, 12:25 PM Reply Like
  • TeddyTidy
    , contributor
    Comments (2) | Send Message
     
    Not all people are backing their margins with other assets, many with their lives...
    11 Feb 2014, 02:16 PM Reply Like
  • ptnyc
    , contributor
    Comments (49) | Send Message
     
    Seems like gold is the hedge now rather than VIX and long volatility ETFs.
    11 Feb 2014, 12:57 PM Reply Like
  • june1234
    , contributor
    Comments (3261) | Send Message
     
    markets like her too. whats there not too like about if doesn't go up we'll make it go up. And if you don't believe Mr Conway ask the Japanase who've been qe'ing last 25 years
    11 Feb 2014, 12:58 PM Reply Like
  • solarcircle
    , contributor
    Comments (312) | Send Message
     
    Here's a fed head that doesn't pretend he doesn't understand gold:
    "Rising prices of precious metals and other commodities are an indication of a very early stage of an endeavor to move away from paper currencies...What is fascinating is the extent to which gold still holds reign over the financial system as the ultimate source of payment."

     

    -Alan Greenspan, 9 Sep 2009
    11 Feb 2014, 01:21 PM Reply Like
  • 6151621
    , contributor
    Comments (1180) | Send Message
     
    @solarcircle: But he had amnesia when he was chairman. Wait to see if Bernanke wakes up and suddenly understands gold?!
    11 Feb 2014, 04:46 PM Reply Like
  • filipo
    , contributor
    Comments (4198) | Send Message
     
    6125836589,
    Yellen, not B.B. anymore.
    BB is at permanent leave.
    11 Feb 2014, 11:23 PM Reply Like
  • JohnBinTN
    , contributor
    Comments (2630) | Send Message
     
    Filipo,

     

    Whose phone number was that? That woman sounded mad! ;)
    11 Feb 2014, 11:33 PM Reply Like
  • filipo
    , contributor
    Comments (4198) | Send Message
     
    john,
    :):):):)
    12 Feb 2014, 05:28 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4359) | Send Message
     
    Yellen did not inspire confidence when she tried to convince Congress that the reason interest rates are low is because of lack of demand for loans. Yeah, right Janet!
    11 Feb 2014, 01:51 PM Reply Like
  • Stock Market Mike
    , contributor
    Comments (2672) | Send Message
     
    Lack of demand, or lack of supply? Mid way through 2013 I tried to get loans from banks, as I saw the good times that were going to continue on the market and in my favourite stocks. I got zilch, except from a local credit union, but since they had only one office, their loan was pretty limited in size. (Barely 5 digits - not even enough to buy a car... heh.)

     

    -Mike
    11 Feb 2014, 02:29 PM Reply Like
  • sethmcs
    , contributor
    Comments (3474) | Send Message
     
    What no margin account?
    11 Feb 2014, 09:43 PM Reply Like
  • Stock Market Mike
    , contributor
    Comments (2672) | Send Message
     
    Margin doesn't help much when your portfolio is 95% call options.
    14 Feb 2014, 05:00 PM Reply Like
  • filipo
    , contributor
    Comments (4198) | Send Message
     
    Yellen has no choice but to taper taper.
    11 Feb 2014, 01:51 PM Reply Like
  • The Geoffster
    , contributor
    Comments (4221) | Send Message
     
    Most projects start out slowly - and then sort of taper off.

     

    Norman Ralph Augustine
    11 Feb 2014, 07:34 PM Reply Like
  • filipo
    , contributor
    Comments (4198) | Send Message
     
    The,
    There's some wisdom in that....
    11 Feb 2014, 11:24 PM Reply Like
  • Tales From The Future
    , contributor
    Comments (6062) | Send Message
     
    I'm keeping my GDXJ from 2013.

     

    Yellen apparently sees no bubbles, I do see quite a lot of them (asset inflation...) all over the world.
    11 Feb 2014, 02:33 PM Reply Like
  • Deepv
    , contributor
    Comments (458) | Send Message
     
    Deepvalue love is short gold stocks at generational lows lol
    11 Feb 2014, 03:18 PM Reply Like
  • 6151621
    , contributor
    Comments (1180) | Send Message
     
    SA tries to downplay the up move in gold by associating it with Yellen but really the short term trend has been up since the beginning of the year.
    11 Feb 2014, 04:48 PM Reply Like
  • 1GreatCFA
    , contributor
    Comments (1181) | Send Message
     
    Well I found it very very interesting from our own research into the 400 or so companies that have reported thus far is that if you take out the banks revenue growth was 2%. So Dutch Accounting and buybacks are all good but how are earnings going to catch up to multiples if this continues? Easy...Janet will make Bernanke look like a Hawk in the words of Marc Faber.
    11 Feb 2014, 05:34 PM Reply Like
  • nooseah
    , contributor
    Comments (549) | Send Message
     
    Boockvar is 100% correct. This taper won't last, especially if stocks tank, which looks imminent. She admitted in testimony they were flexible on tapering. Who will fund the budget deficit in its entirety? Not bond investors - at these levels.
    11 Feb 2014, 06:05 PM Reply Like
  • LeahyInvestor
    , contributor
    Comments (103) | Send Message
     
    She supports the taper, I don't know why this makes sense. Plus gold is moving more of market melt down than inflation. If gold actually went with inflation, it would be far less. Gold is too emotional now and volitile to be solid. It is in an outlier period, fueled by ETFs and fear.
    11 Feb 2014, 09:54 PM Reply Like
  • LeahyInvestor
    , contributor
    Comments (103) | Send Message
     
    Lower personal debt, under invested companies and youth, all are things to consider... since there are lots of cash that can be invested. When we were maxed out, people didn't seem to notice but there is room to grow just from cash on the side lines.
    11 Feb 2014, 09:55 PM Reply Like
  • filipo
    , contributor
    Comments (4198) | Send Message
     
    Which side lines, Leahy ?
    11 Feb 2014, 11:26 PM Reply Like
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