Could Gold Sell for Two Thousand Dollars an Ounce?
We have been relatively vociferous of late about the state of the British economy, the state of the British government and the overall feelings of negativity and depression that are rising in the UK. Please forgive us for we are not normally politically motivated, but we have been reacting to the strong sentiment we’re hearing from increased numbers of our British readers.
And Britons are not alone in being aware that they are facing the very real prospect of unprecedented and frighteningly bad economic times. All across Europe and on the peripheries of Europe there is unease about the state of nations’ economies. And according to some of the most senior analysts at Citigroup, if the efforts that governments are currently committing to to drag their nations out of economic meltdown fail, we could enter: “a downward spiral into depression, civil disorder, and possibly wars.”
So, could gold sell for up to two thousand dollars an ounce? Again, the analysts at Citigroup believe that this is possible as the gamble that governments are currently taking could either fail and lead to the aforementioned downward spiral of depression, or result in a resurgence of inflation - with both outcomes likely to cause a rush for gold.
Citibank’s Chief Technical Analyst, Tom Fitzpatrick, has commented on the fact that as the weeks pass and more and more frightening facts are revealed about the terrible state of the world’s financial markets, and as governments react in the most bizarre ways such as attempting to borrow more and spend their way out of recession, so confidence is being eroded. People are really beginning to feel that they are having their backs pushed up against the wall and it is at this point that civil unrest can follow. As Mr. Fitzpatrick points out: “There is a risk of domestic unrest, starting with strikes because people are feeling disenfranchised…what happens if there is a meltdown in a country like Pakistan, which is a nuclear power?”
Gold traders are watching everything unfolding very carefully indeed, they are aware that when the tough gets going every government in the world will be looking at boosting gold reserves. There’s already talk that China is thinking of boosting its reserves to the tune of some 3,400 tonnes, and naturally this would not only have a positive impact on the value of the commodity, it would probably persuade others to follow in China’s footsteps. Having already tripled in value over the past seven years, gold is currently way off this year’s high of USD 1,030 – but Citigroup believe that everything could start getting very exciting as soon as final quarter 2009, and that yes, it is feasible that if we enter a state of global meltdown that gold could sell for up to two thousand dollars an ounce. To buy your own gold or find out more about trading this commodity, go to www.bullionvault.com
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