Gold Prices

Goldcorp Inc. (GG) has been good for me the last few months.

Thanks gxseries. More research for me to do. That's what I like!

quote docsfishn: "f I could predict this then I would be a very wealthy man."

Ain't it the truth!

Gold has demonstrated that it can multiply ten fold, it was $70 in '74, it's $700 now. Who knows if it will be at $7000 in 30 years?

For that matter the Dow Jones Industrial Average was at 1400 in '85, it's 14000 now.

Years from now we may be looking back at '07 as the good old days when you buy gold "cheap."

You never know, you never know.

It can be hard to predict, but as CommandD noted, gold tends to go up when there are serious problems in the society. The United States is showing a lot of signs of trouble lately, so gold is likely to go up relative to the U.S. dollar. This could, of course, turn around at some point. If things start looking good again for the U.S., precious metals might drop. Lately, I have been keeping an eye on the price of rhodium since I want some for my element collection. Unfortunately, it has skyrocketed in recent years and has been trading lately at around $6000/oz. A few years ago, when gold was low, rhodium would have been a far better investment than gold or silver. Rhodium is notoriously volatile and dependent on supply-and-demand. In the past, it has skyrocketed like this and then plummeted dramatically. If you look at the historical charts back to the 1970's, you'll see what I mean. It might happen again. I'll probably buy about a gram of rhodium before long so that I have some in case it goes up again, and if it plummets later I'll buy a lot more. Ruthenium is also rather high lately; last I checked it was between $500 and $600/oz. I wonder if it will come down any time soon. As for the other platinum group metals, iridium, osmium, and palladium are trading at close to $400/oz lately. In practice, osmium in solid form usually costs significantly more than the spot price because osmium powder (the usual way that it is supplied) is dangerous to work with and melting it into a lump is therefore rather labor intensive. Platinum has also gone way up in recent years. Last I checked, it was about $1450/oz. It's interesting how all of the precious metals have been going crazy lately.

Here are the rhodium charts.

http://www.kitco.com/charts/rhodium.html

Heather

I don't see any reason to factor in population, but you have to consider the time factor. I don't have exact figures in front of me, but it's probably safe to assume the price has doubled in the last 3 years, which works out to a 24% + annual return, which is pretty good. However, it only doubled 2 & 1/2 times over the preceeding 27 years, which works out to a much less impressive annual rate of around 6%.

Jim is on the right track - it's not only the industries that are demanding gold for various plating, electrical purposes but it's always people who wants a bit of gold for jewellery, whether it to be gold plated or a heavy gold chain chunk. Gold has always been a status of symbol in Asia and therefore they will keep buying - it's not difficult to tell that the population in both India and China will keep on raising and these are the countries that are pushing the demand up and up.

I agree with gxseries:

Gold is by default the "value holding" for human kind. Ever since its discover, gold had been used and contributed to human kind. Especially in unstable region/time. For every single war in this world, people fall back to gold/precious metal. Except for countries that still have "gold backing" for their currency, every single piece of coin/note that you are holding in your hand are worthless overnight, if the government that issued is shattered. Remembered Germany in WWI and WWII? How about Yugoslavia in the 90s? Whenever things like that happened, people will stockpile gold as a way to secure their wealth!

More people = more demand for gold
Instabilities in the world = more demand for gold
Industries uses increased = more demand for gold
Gold price and oil price are some how correlated

Currently: China (1.3 billions) + India (1.1 billions) + Indonesia (234 millions) population alone are one-third of the world population. They are the people who valued gold more than their own money! They use gold as saving and they used gold for jewelries too.

Current US political situation, Arabs nations (including instabilities in Pakistan right now), Africa are all considered instabilities - more than in the 90s.

There are more use of gold in industries now then ever before

The Middle East political climate is very volatile, that get people worried - oil supplies are mainly from that region ===> oil price continue to climb and there are more demand for oil as heating as Winter is approaching.

***Someone mentioned the FED cut rate, YEP that will devalue the US dollar, which make gold more attractive than USD, which mean we, the people in the US, will see gold at higher price. However, people in other countries who used USD as to store their wealth (save/buy USD instead of use their country money and put them in bank) will trade in gold for USD. Market calibration is right here!***

All in all, Gold Will Go Up! The question is when will it stop? May be to 1000 USD by end of Winter?


Who know? I don't!!

I was lurking here because I am curious about this very subject. If the dollar declines I would think Gold would go up. But who knows. The thing that interests me about gold though is it's a world-wide commodity and can't you sell to a foreign market where rates are better? Of course there is that pesky exchange rate (kills me on UK postage I need).