k612

Oil Replaces Gold as the New Inflation Hedge

Oil pricing has grabbed the stage as the demon of the day. Gold and oil moved generally in tandem until they decoupled in about April. Likely due to wild speculation in oil that has not materialized in the gold market.

OK-- what happens when the oil bubble blows but inflation or wild geopolitics takes its place as the evil of the day? A lot of other bad things are masked by the oil hoopla. Will oil and gold drop together or will gold decouple and rise in a reverse crossover due to a new speculative bubble in gold? Dunno--At this point it seems that gold is moving down faster than oil in each oil dip.

I think that the etf's have made gold or silver much more of a "regular" investment. GE, MSFT, commodities, gold. silver-- who cares-- just analyze, buy, hold and sell. Part of the reason for the decoupling may be a new attitude about gold. The etf buyers jump in and out. They really don't see it as a lifestyle or political statement. It is just another potential investment that is now a mouse click away.

BTW--I dropped about a third of my gold and silver three months ago. 50% was enough gain and I was getting nervous. I am nervous again as well.