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Posted 09/03/2011 6:13 pm
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One final reply... gold went from about $850 an oz. in 1980 to about $260 an oz. in 2001. This is almost a 70% decrease. Is there anything stopping gold from doing this again? ($581).
One final reply... gold went from about $850 an oz. in 1980 to about $260 an oz. in 2001. This is almost a 70% decrease. Is there anything stopping gold from doing this again? ($581).
There certainly is... it is called a HUGE load of public debt and an incompetent government that has caused most of these problems. Looking to them for being responsible and resolving our problems seems a false hope... and this IS what it will take to lower gold prices in any kind of meaningful way. These problems would have to be addressed and a plan to pay down our debt implemented. I haven't seen a single move from the government in that direction. Everything I have seen points to a steadily cheaper dollar. If people had confidence in the US dollar or the Euro, we probably would not be seeing $1800+ gold right now.
In 1980, the US federal debt was about $400B. Today, we pay that in annual interest alone on the $14.5T (and rising) debt and are doing that at interest rates that are lower than anyone now alive can remember. Interest rates only have ONE way to go and that is up. When that happens, interest on the debt will balloon to double or even triple what it is today. Imagine what effect THAT will have on the dollar and therefore the price of gold.
