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Gold has just broken the $1000 barrier. But I don’t think that this is the big move in the price yet… that’s still to come and it can go through the $2500 mark.
The main reason is that central banks have started to print vast quantities of money and clever investors are losing faith in fiat currencies. Gold has always been seen as a refuge and that is still the case.
No matter that the Chinese are buying huge quantities of US T-bills and thus have an interest in keeping the dollar value high… given the size of the bailout packages in the US the dollar looks more and more overvalued. As the US dollar is the reserve currency where does one go? Gold is looking to be one answer.
As soon as the East starts to buy Gold rather that US T-bills there will be a huge surge in the price of Gold and who knows what the ceiling could be .. $2500 could be a new floor price.
What the promoters of fiat money might do then remains to be seen. I suspect the hunting down of the "speculators" followed by confiscation. This might be the penalty for undermining the entire global financial system?
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