gold prices going nowhere but up k.r,vhgi seem's primed here,
How high can gold go? feb 05, 2010
You can see from the long term gold chart below that prior to peaking in January 1980, the price approximately doubled in the last two months. That gold primary bull market then ended. The primary bear market that followed lasted until 2002 when the primary bear market for the dollar commenced and today's primary bull market for gold started.
If gold today, in real terms, was to match the 1980 high, it would be at $2,400/oz. Understandably, we wish to remain invested until this primary bull market has ended because the prize to be won is so great.
The world today is one of competitive currency devaluation. With reduced world trade, the cheapest currency will compete with the best to win exports. Gold cannot be replicated and has, since time began, been the only reliable store of value because of that. It benefits considerably in an environment such as now.
The production of gold is in steady decline, and China is already the world's biggest producer. However, we suspect that they will continue to be net importers on their journey to becoming the world's major economy. Increased gold reserves will give them considerable financial strength. Furthermore, the opportunity to easily swap depreciating dollars for appreciating gold will not be missed.
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