Gold is the trade of choice as the eurozone flounders with 21 out of 22 traders surveyed by Bloomberg bullish about next week. That said gold and silver prices have fluctuated over the past week.
November 8th saw gold cross the $1,800 barrier before sinking $50. Silver prices around $35 have been strong, miles away from the pessimism of the summer months.
$2,000 soon?
Gold should reach $1,950 by the end of the first quarter, according to Bloomberg’s top 10-rated gold forecasters. Meanwhile, the prospect for share prices has dimmed with trade slowing all over the world, even in China.
Quoted companies are going to struggle to deliver the promised advance in profits next year as a recession or near recessionary climate closes in.
At the same time the bond market is clearly pressing for higher and higher interest rates. Bad news for bonds of course but also stocks and real estate.
The default position is gold and silver. There is also good reason to believe that the financial crisis will ultimately result in an inflationary printing of money as it did in the US and China three years ago.
Euro crisis
Once European authorities get their head around this we are going to get much higher prices for gold and silver. However, be weary of trying to time market cycles.
The short-term panel of Bloomberg experts is only right 58 per cent of the time, while over a three year time horizon ArabianMoney can boast 100 per cent accuracy (see the video here).
We can’t tell who will resign or surprise us next week. We can say that this crisis cannot be solved easily and every way you look is good for precious metals looking forward over the next two years. And we can see silver topping gold for performance (click here).
-- Posted Friday, 11 November 2011 | Digg This Article | Source: GoldSeek.com
comments powered by DisqusPrevious Articles by Peter Cooper About Peter Cooper:
Oxford University educated financial journalist Peter Cooper found himself made redundant by Emap plc in London in the mid-1990s and decided to rebuild his career in Dubai as launch editor of the pioneering magazine Gulf Business. He returned briefly to London in
1999 to complete his first book, a history of the Bovis construction group.
Then in 2000 he went back to Dubai to become an Internet entrepreneur, just as the dot-com market crashed. But he stumbled across the opportunity to become a partner in www.ameinfo.com, which later became the Middle East's leading English language business news website.
Over the course of the next seven years he had a ringside seat as editor-in-chief writing about the remarkable transformation of Dubai into a global business and financial hub city. At the same time www.ameinfo.com prospered and was sold in 2006 to Emap plc for $27 million, completing the career circle back to where it began a decade earlier.
He remains a lively commentator and columnist as a freelance journalist based in Dubai and travels extensively each summer with his wife Svetlana. His financial blog www.arabianmoney.net is attracting increasing attention with its focus on investment in gold and silver as a means of prospering during a time of great consumer price inflation and asset price deflation.
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