……. “be foolish to think Bernanke’s comment on gold was just some off the cuff remark. Gold was trading at or near new all-time highs and breaking out when his quote hit the wires. While I’ve always respectfully differ with my good friend Bill Murphy belief that the Gold Cartel is in the market daily, I do believe these comments by Bernanke were done with a purpose. The anti-gold crowd is in deep trouble. The recent nonsense from Jeff Christian over his squabble with GATA reeked of a controlled panic in my eye. The media continues to be filled with calls for gold to go much lower. Prechter’s latest market top forecast (He has made several others all the way up) is the latest carrot being used. before that it was the Barclay’s guy coming fall that’s now triple-digit in the red. For me, none can ever top the utter nonsense BNN was aired about the Mr. T gold sell signal a couple hundred dollars ago. Gold is in the “mother” of all secular bull runs and $1,300 is our next milestone.” – Peter Grandich
Bernanke Puzzled by Gold Rally
Federal Reserve Chairman Ben Bernanke says he’s a bit puzzled by surging gold prices. The 30% rally from a year ago, on top of gains in previous years, might be interpreted as a loud signal from markets that big inflation pressures are building in the U.S. Gold is seen by many investors as a hedge against inflation risk.
In this case, it might instead be a hedge against risk broadly. Mr. Bernanke notes that the inflation signal isn’t confirmed by movements in other asset classes. Yields on Treasury bonds tend to rise when investors worry about inflation, but those yields have been falling recently. Inflation expectations as measured in Treasury Inflation Protected Securities (TIPS) markets remain low. And other commodity prices are falling. Gold is breaking records, but copper prices are down 17% so far this year.
“I don’t fully understand movements in the gold price,” Mr. Bernanke admitted. But he suggested it might be another example of investors fleeing risky assets and flocking to assets that are perceived as less risky, not only Treasury bonds, but also ones like gold. – Jon Hilsenrath Wall Street Journal.
On Major Moves, Peter Grandich has been very right and not only saved many investors fortunes, but expanded them dramatically. On November 3, 2007 at the MoneyTalks Survival Conference, Peter Grandich of the Grandich Letter warned that “an unprecedented economic tsunami will hit American beginning in 2008”. Peter advised publicly to short the US market two days from the top in October, 2007 and stayed short until the last week of October, 2008. He began to buy stocks in March 7th, 2009. He also bought oil and oil related investments near the lows after the dive from $147.
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