Over $1000, But Is That “High?”
October 19, 2009 by Martha Rooks
After a 19% increase, gold hit $1072 per ounce last week. It’s down just a little as the week opens ($1052.92). Remember when the recession was closing in on us and prices began to go up fast, so many people rushed off to trade in their gold? It was interesting to watch and certainly, more interesting in watching others around us digging through jewelry boxes long buried in the back cupboard or closet.
The price sounds good to the ear. “Over $1000 per ounce! Run, don’t walk to your jeweler now to trade your gold for cash!” Do you remember the excited voices gathering at the office watercooler? But perhaps they sold out too soon.
Let’s consider that price with an eye to trading over the past several decades. In the 1980, gold what was then a record high: $873 per ounce. That may not sound like a lot, but consider that those were 1980 dollars. Adjusted for inflation, that would equal a whopping $2287, according to the U.S. Department of Labor’s inflationary index.
Judged by those numbers, the new “record price” is still 53% below the 1980 price. For that reason, many experienced traders and marketwatchers think the price of gold still has some “go” in it.
“Gold is not at any peak,” says Martin Murenbeeld, chief economist at DundeeWealth, Inc., (Toronto), which manages $58.5 billion in mutual funds and brokerage accounts. “The world’s money supply has increased and gold hasn’t kept pace.”
Which means, there is plenty of room for gold to continue upward as investors continue to look for a hedge against inflation, instability and other losses in the markets.
In fact, some are predicting $2000 will be the new ceiling.
“Gold is the hedge against currency devaluation,” John Brynjolfsson of Armored World LLC said in a Bloomberg TV interview from Aliso Viejo, California on October 7. He, along with many bankers, is raising his estimates.
Time to raise a little cash and invest yourself? Perhaps. Or maybe time to sell.
You Might Also Like:
- Gold: Near Record High and Potential to Reset
- Gold Prices Hit $1000 mark… AGAIN!
- Gold Prices Hit Historic High!
- TOP 10 MOST
POPULAR BLOG POSTS
- The Real November Birthstone: Citrine or Topaz?
- Why is Platinum More Expensive than Gold Jewelry?
- Understanding the Price of Platinum Jewelry
- Certified Diamonds vs. Non-Certified Diamonds
- Jewelry Hallmark Guide
- Rhodium Plating White Gold
- Platinum vs. Titanium Wedding Bands
- The 4 C's of Diamonds: Which C Matters Most?
- Price of Gold Per Gram
- Gemstone Ratings