megiddo666

Yet Another Round of Panic

Thanks for a voice of reason in the middle of panic. While their certainly are problems in housing and finance, there are still areas of strength in business and the markets. It will be interesting to see how long it is before sentiment shifts.

Unlearning the Psychology of Markets

After carefully following global agriculture and geo-politics for the last few years, I would suggest that gold may be driven up as a haven against instability created by massive change in global economic systems.

For example, global grain shortfalls are a significant factor in government planning and action across Asia and Africa, where governments are attempting to minimize social instability due to real or perceived shortages and agriculturally driven inflation.

Hard asset acquisition in relation to this instability is high in Asia. An example is Pakistan's current situation, not just its political instability the West reads about, but its current economic disruption due to grain shortages, etc, that is a driver for gold purchase, since gold is seen keeping up with the inflationary spiral for core goods, such as fertilizer.

It seems that local economic factors regarding change are driving gold purchases across larger geographic areas, not just in response to inflation, but local market disruptions, against which gold is an economic hedge as much as a status symbol.