Gold Just hit $1000.00

[talkgold]

Gold has hit its benchmark of $1000.00 just now

Quite amazing. How much further will it go? 5 years ago it was only in the low $300's.

It's funny the main gold website Kitco.com just crashed it seems.

Predictions anyone?

"Concerns in the credit market, persistent Dollar weakness, and gradual acceleration of inflationary pressures is providing a foundation of support for gold," says James Steel of HSBC.

Only on Tuesday, Steele warned that the Federal Reserve's $200bn Aid Package for New York's biggest banks would support the Dollar "and therefore weigh on Gold", calming financial markets and "reducing the need to purchase bullion as a safe haven."

But in Tokyo today the Nikkei stock index closed 3.3% lower as the Hang Seng in Hong Kong dropped 4.8%.

The FTSE100 here in London lost 1.8% at the opening after Carlyle Capital Corp. – a hedge fund run by the US Carlyle Group – said it expects creditors to seize all of its remaining $21.7bn portfolio of mortgage-backed investments.

The fund failed to meet margin calls from its brokers last week. Shares in CCC sank 70% at the Amsterdam stock exchange this morning.

"Carlyle's troubles have amplified fears that billions of dollars of depressed mortgage-backed securities will flood the market, reducing their value even further," notes Toby Anderson for the Associated Press.

Over on the currency markets today the Euro spiked above $1.56 to reach its 11th new lifetime high in the last 13 sessions.

The Dollar also sank against the Japanese Yen, dipping below ¥100 for the first time since the fall of 1995.

On the world's commodity markets, meantime, the sinking Dollar added fresh impetus to base metals, energy prices, and all soft commodities barring wheat.

"We are in the early stages of an extended bull market on commodities," reckons Christopher Wyke at Schroder Investment Management. "Depleting resources and environmental controls will further depress supply and push up prices.

"As the US currency falls, commodity prices – mainly quoted in US Dollars –will be attractive for Asian nations."

China and most south-east Asian economies remain "pegged" to the Dollar, importing inflation in the cost of living as they devalue their currencies to remain competitive on world export markets.

That's why in China "inflation is growing at its fastest pace in 11 years," notes Dan Denning of The Daily Reckoning today. "Chinese consumer prices were up 8.7% in February. Food costs were up a staggering 23%."

Most petro-rich states of the Opec oil cartel continue to peg their currencies to the US Dollar, too. Today US crude oil futures for delivery in April touched $110.70 per barrel, yet another fresh all-time record for the front-month contract.

Oil has broken a new record high every day this week, but "current market activity has nothing to do with spot fundamentals," reckons Tom James at Liquid Capital Markets in London.

"[The oil] market is now just struggling to absorb tens of billions of dollars of fresh, mainly long-only investment."

Tokyo gold futures meantime slipped 1.2% against the Japanese Yen today, but they rose almost $14 per ounce in US Dollar terms to equal $995.82.

And on the supply side this morning, South Africa's official statistics agency confirmed that gold-mining output from the world No.2 fell 16.5% year-on-year in January, driven lower by the power shortages that closed the entire mining industry for five days late in the month.

Overall mineral production fell 10.7% from Jan. 2007. The gold-mining industry in South Africa is still only receiving 95% of normal energy supplies.

Last year the underlying trend in global gold-mining output – now shrinking fast thanks to surging costs, lower ore grades and a lack of new discoveries – cut South African production by 7.4%.

Global gold mining output fell by 1% in 2007 according to the GFMS consultancy. None of the top five gold-mining companies managed to increase their production.

Whereas the US money supply, in contrast, is now expanding by more than 15% year-on-year according to the Federal Reserve's MZM data series.

The world supply of Euros is growing by 11.5% year-on-year, while the United Kingdom has seen double-digit annualized growth in the Sterling money supply every month for the last two years running.

[geoff01]

Amazing, who`d have predicted that just a few years ago?

[saxifrage]

Originally Posted by talkgold

Predictions anyone?

USDX to less than 50. Gold to $4000. Dow to 4000.

[saxifrage]

Originally Posted by geoff01

Amazing, who`d have predicted that just a few years ago?

Many people did. But they dont get shows on Fox and CNBC.

[talkgold]

Are those serious predictions Sax? Just wondering? I do think the market is going to have serious issues, however I don't see the dow dropping 2/3rds its value. If so, that would be Great depression numbers almost.

[saxifrage]

Originally Posted by talkgold

Are those serious predictions Sax? Just wondering? I do think the market is going to have serious issues, however I don't see the dow dropping 2/3rds its value. If so, that would be Great depression numbers almost.

Yes Brian. They are serious. My call for the USDX might not be quite right... it depends how much competitive devaluation other central banks get up to.

You (we all really) are staring down the barrel of a depression, yes. In fact, Im predicting this to happen again:


Maybe my numbers wont be quite right, but the important thing is gold/dow parity.

It wasnt that long ago that people were convinced that houses could NEVER go down in value too...

[me222]

Originally Posted by geoff01

Amazing, who`d have predicted that just a few years ago?

Many of us, "conspiracy theorists" have predicted it while some respected members laughed it away.

This is just the beginning. The American dollar, Canadian dollar and peso (and the USA) will cease to exist in 2, 3 years and will be replaced by a new currency: the Amero.

A great depression that will make look the one in '30s like a non-event, gold at 5K, silver at $100 ($200?), before the end of next president's term.

Obama: "Let's unite with Mexicans, Asians, black and whites in a bigger and stronger America." It should sell easily to the ignorant masses.
No more America but NAU, but then I'm a nut case...

[Xman]

Dollar is losing value. It is why gold is so expensive in $. I don`t think that gold was over 3 times cheaper with the price of euro.. My opinion only

[themoneyman2]

gold down 6% today

[TonyRivers1]

What will be price of Gold 6 months from now?