Gold Price Forecast 2013, Buying Opportunity?, is Silver Cheaper?
Gold and Silver bugs have had an abysmally poor 2012 against expectations for new all time highs, where a 1 year bear market from the August 2011 high into the May 2012 low failed to spark a sustained run to new all time highs. The rally from which petered out by early October at $1800, followed by another trend back to leave Gold at $1657 as per the last close, this despite reams and reams of material plastered all over the internet that hoped for an eventual return to a gold standard or "Sound Money" as being the ultimate outcome of our ongoing global debt and money printing crisis.
However, it is never going to happen, or rather not under any western style democracy, for this I don't need to indulge myself in in-depth analysis but direct readers attention to what continues to take place in the Euro-zone where the PIIGS countries having adopted pseudo sound money of the Euro have found themselves in the precise predicament of where they would be had they had a Gold standard, namely that they are unable to just print debt and money to buy votes with the stealth default consequences of inflation, whilst on the other hand we have the examples of the United States and UK that can and do print debt and money in ever expanding volume as they seek to buy up their own bonds (via central banks buying from bankrupt banks who borrow form the central banks to do so) and thus subvert the official debt to GDP ratios as I recently discussed in length (03 Dec 2012 - Bank of England Cancels Britain's Debt) with the below graph illustrating the money and debt printing / cancellation highly inflationary game that Britain is playing.
So, if you have read any of my articles over the past few years you will know that the only answer that the governments of the world have is to print money and debt to inflate the debt and liabilities away, Sound money or even pseudo sound money prevents them from doing so and therefore ensures a deflationary depression, instead we are emerged in an inflationary depression which given the real world comparisons appears to be infinitely far more palatable to the masses and therefore explains why it is every government and central banks default setting.
So Gold bugs looking for sound money to turn Gold into Currency will probably find that their descendants will still be waiting a for such an outcome. Ironically, if Gold never becomes money (in our life-times anyway) it is still good news for if it were then it would probably mean that Gold's future prospects would not be as good as they are under our fiat currency money / debt printing exponential inflation inducing monetary system as governments would seek to dictate what the price of gold should be rather than the current system of manipulation of all markets to varying degrees.
Now, whilst it has been been a long time since I last analysed or traded Gold and Silver. However, if you have been reading my articles you will be aware of the prevailing exponential inflation mega-trend as a consequence of government debt and money printing that continues to exert upwards pressure on asset prices and even more so when leverage is taken into account, therefore following the recent sell off in gold to $1660, a good 14% below its 2011 peak, which is perking my interest in the safe haven precious metals that this analysis seeks to resolve the probable trend for 2013.
Read More
Gold and Silver bugs have had an abysmally poor 2012 against expectations for new all time highs, where a 1 year bear market from the August 2011 high into the May 2012 low failed to spark a sustained run to new all time highs. The rally from which petered out by early October at $1800, followed by another trend back to leave Gold at $1657 as per the last close, this despite reams and reams of material plastered all over the internet that hoped for an eventual return to a gold standard or "Sound Money" as being the ultimate outcome of our ongoing global debt and money printing crisis.
However, it is never going to happen, or rather not under any western style democracy, for this I don't need to indulge myself in in-depth analysis but direct readers attention to what continues to take place in the Euro-zone where the PIIGS countries having adopted pseudo sound money of the Euro have found themselves in the precise predicament of where they would be had they had a Gold standard, namely that they are unable to just print debt and money to buy votes with the stealth default consequences of inflation, whilst on the other hand we have the examples of the United States and UK that can and do print debt and money in ever expanding volume as they seek to buy up their own bonds (via central banks buying from bankrupt banks who borrow form the central banks to do so) and thus subvert the official debt to GDP ratios as I recently discussed in length (03 Dec 2012 - Bank of England Cancels Britain's Debt) with the below graph illustrating the money and debt printing / cancellation highly inflationary game that Britain is playing.
So, if you have read any of my articles over the past few years you will know that the only answer that the governments of the world have is to print money and debt to inflate the debt and liabilities away, Sound money or even pseudo sound money prevents them from doing so and therefore ensures a deflationary depression, instead we are emerged in an inflationary depression which given the real world comparisons appears to be infinitely far more palatable to the masses and therefore explains why it is every government and central banks default setting.
So Gold bugs looking for sound money to turn Gold into Currency will probably find that their descendants will still be waiting a for such an outcome. Ironically, if Gold never becomes money (in our life-times anyway) it is still good news for if it were then it would probably mean that Gold's future prospects would not be as good as they are under our fiat currency money / debt printing exponential inflation inducing monetary system as governments would seek to dictate what the price of gold should be rather than the current system of manipulation of all markets to varying degrees.
Now, whilst it has been been a long time since I last analysed or traded Gold and Silver. However, if you have been reading my articles you will be aware of the prevailing exponential inflation mega-trend as a consequence of government debt and money printing that continues to exert upwards pressure on asset prices and even more so when leverage is taken into account, therefore following the recent sell off in gold to $1660, a good 14% below its 2011 peak, which is perking my interest in the safe haven precious metals that this analysis seeks to resolve the probable trend for 2013.
Read More