I read same article but picked up on a few other things as well.
"He raised the prospect of the United States launching a military strike against Iran because of the Middle Eastern nation’s nuclear ambitions, something which would send the oil price to possibly $100 a barrel from below $60 currently, dragging gold into unchartered territory." This fits with the geopolitical situation I see as well.
"Investment demand is seen picking up late this year and early next year. Fabrication demand is helping to limit the current fall in the gold price and will put a floor under it rather than drive it higher, he said." Agreed, jewelery demand right now supporting price, investment demand will increase with war.
"Dehedging will continue to provide support, but it will not match the estimated 378 tonnes for 2006 – a 341% increase on the previous year." I think the impact of this was underestimated and has indeed fallen off greatly (barrick for instance)
"Gold production is not seen picking up in a big way over the next two to three years because of a decade of underinvestment in exploration and development, he said."
agreed, supply inelastic to increased demand
As for his longer term negative views I disagree
I see commodities coming back and so far oil is being suppressed IMO, specifically through futures, i.e. pieces of paper. I am sure some here must often think me a pessimist, that I exaggerate the importance of war, view of the political situation in US but so be it.
The world is on the threshold of wider war in ME whose momentum is building. The media is being quite silent as to the military buildup taking place. We have even seen politicians ask for Bush to be restrainded, in desperation as they see the steps being taken for war, calling for the generals to refuse the order and arrest the President, i.e. only the congress can declare this war.
Gold and oil are the two biggest indicators of the true state of affairs and are purposely being mangaged to hide the truth, win more seats etc etc. The US has overwhelming military hardware and an economy that swamps the world with demand. They are projecting this power and it includes control of any market anywhere at any time. Gold and oil will resume their climb but at present it is not good politically.
I am sure many here have read about increasing 'fear' of many alt. media of a false flag action implicating Iran prior to elections. For anyone who has followed the 911 truth movement this does not seem farfetched. Hard to judge such fears but would say it seems the administration is acting forcefully in the oil, gold and currency markets(holding dollar steady).
Standing aside is my present position as the fix is in. At the same time my feeling is that we have established a floor here and deep pockets should and likley are accumulating and positioning.
The strenght in commodities rather than gold seems a harbinger of things to come. "Earlier mixed price signals gave way to across-the-board strength in London Metal Exchange metals Wednesday afternoon led by near-record highs in nickel, zinc and lead prices." http://metalsplace.com/metalsnews/?a=7634
Anyone following Turkish and Iranian Kurd initiative?
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