Why do we see more volatility in the gold market now?
Best Answer
2183 points
ChaosNantuko answered 8 months ago …
When people expect inflation, gold will go up.
When people expect deflation, gold will go down.
The recent batch of government interference in the markets has cast a lot of doubt on the deflationary argument, and the more complexity involved in the question, "Will we have inflation, or deflation over the near future?", the more volatility we will see in gold.
Answers
368 points
ads answered 8 months ago …
ChaosNantuko's explaination is accurate in my opinion. Gold tends to be very dependent on the fears that he mentions and the governments recent interference in the markets and economy has created a lot of doubt and concern on both sides regarding inflation/deflation.
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546 points
warren answered 8 months ago …
Quantitative easing has been talked about for a while. Now it has begun by the fed buying treasuries. They are monetizing the debt and traders and wealthy now see that it has begun. Major if not hyper inflation has started. While it won't show it's face to the public for a months or even a year or more, anyone who really understands the mechanics of the economic system knows this. It is now set in stone.
Protect yourself with physical metals first. I have been saying the same thing over and over for years. Now it is here. Gold and silver are still cheap and available. It won't be for too much longer.
Give me any other investment performing like gold...nothing. Gold will be the next bubble, but that is years away.
I suggest you google hyperinflation. Study history and learn from it. It's simple really. We ARE on the path Zimbabwe has recently taken.
Please take care, and protect yourself.
Warren
www.preciousmetalstockreview.com
115 points
buysideguru answered 8 months ago …
It definitely has a lot to do with the inflationary pressures that all of these government stimiluses are causing. Tuesday's announcement that John Paulson, of NY hedge fund Paulson & Co., purchased 11.3% of AngloGold Ashanti had to feed the fire also. His firm famously made huge bets against the sub-prime market and UK banks.
Tuesday's article "Paulson Buying Gold" on www.hedgetracker.com goes deeper into the John Paulson's effect on Gold Prices and links to the company's press release.
