Gold price dives through support to new low. Gold Bubble continues to deflate.; Gold price to drop another 15% this year say strategists at Societe Generale
Tweet Topic Started: 3 Apr 2013, 10:29 AM (37,646 Views)
Gold prices could average $1500 per ounce over the course of this year, gradually dropping to $1375/oz by the end of 2013, according to strategists at Societe Generale.
"This 15% fall is quite dramatic especially compared to the Bloomberg consensus forecast of $1752/oz by the end of 2013," SocGen's Patrick Legland wrote in a research note under the headline "The end of the gold era."
The rally in gold prices over the past five years was driven by fears that money-printing by major central banks would lead to very high inflation but so far price rises have been contained and now there are three factors that could put a stop to the rally, according to the SocGen note.
The three factors are: better economic conditions that would justify an end to the Federal Reserve's quantitative easing policy, under which it is buying assets on the markets to create money, fiscal stabilization, and a rise in the US dollar.
"It seems unlikely that investors would want to add much to their long gold positions in this context. If so, the gold price would trend lower at pace as the physical gold market is seriously oversupplied without continued large-scale investor buying. Selling by investors would add fuel to the fire," Legland said.
It will keep dropping, as world growth improves gold is less attractive. For gold to rally you need the US to go into massive economic trouble which is not going to happen any time soon. Of course North Korea could start lobbing nukes around which might rally gold prices.
Most experts believe gold has bottomed and is set to rally, so which is the best investment, Sydney property at the peak of its bubble or gold after its consolidation phase and ready for its next rally? Idiot.
It will keep dropping, as world growth improves gold is less attractive. For gold to rally you need the US to go into massive economic trouble which is not going to happen any time soon. Of course North Korea could start lobbing nukes around which might rally gold prices.
Yes, it's already down over 20% in real terms from the peak of the gold bubble, and if Societe Generale are right and it falls another 15% nominal, that will be over 40% down in real terms, which is the same magnitude as the property crash predicted by Steve Keen and his legion of gloomers. Funny the way we never heard Steve Keen warn about the impending 40% gold price crash... he might have finally got something right if he had predicted that, instead of constantly predicting the 40% house price crash that never happens...
Most experts believe gold has bottomed and is set to rally, so which is the best investment, Sydney property at the peak of its bubble or gold after its consolidation phase and ready for its next rally? Idiot.
Before calling others names, perhaps you could explain why Sydney property is 'at the peak of its bubble' when it is in high demand and produces a regular yield, whereas gold is 'ready for its next rally' when the worlds' economic issues are not causing life as we know it to end and gold provides very little real utility.
You have to go back to Aug 2011 to find the last time the price (in $AU) was lower than it is today (ie, < $AU1500). $AU Gold price has been in a consistent down trend for over 18 months now.....
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