In testimony to the US senate last week Ben Bernanke admitted he doesn't understand the gold price. Not only that, but "nobody" does.
That's not particularly helpful if you're trying to earn a buck in today's tough markets, although it does go some way towards explaining the disparate nature of the news and views in the gold space in recent weeks.
In Canada last week, as reported in our weekly roundup, gold equities finished up. In Australia, gold equities finished down.
In South Africa, the big news was that Anglo Gold Ashanti's credit rating has been reduced to junk by Standard's & Poors, following the three month decline in the gold price. Anglo is also writing down more than US$2.2 billion in assets. Unsurprisingly, yields on its bonds surged to 7.63 per cent.
Meanwhile, ETFs are beginning to get going in China, although the uptake hasn't been as strong as many had hoped. On the physical side though, demand is soaring, according to commentary from Sprott.
But then Standard Bank reckons that US$1,300 gold is the upper psychological limit for Chinese physical buying.
Over in Dubai, gold has now become convertible into human fat: they're offering Dubai authorities offering a gram of gold for every kilogramme of weight lost.
And on the internet, apocalypse specialist Jim Sinclair cites predictions that this year should witness some sort of a financial crisis far worse than 2008.
Which brings us back to Ben Bernanke. Bernanke also said this week that people hold gold as "disaster insurance", and as protection against inflation. However, he also added that gold is not actually a good predictor of inflation.
But whether or not it's a good predictor of "disaster", he left open to question.
| 95th Minesite Forum - 11th September 2013 |
95th Minesite Forum
Wednesday 11th September 2013
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