Gold Prices: Now or Next Year?

Gold prices are not setting new records, but they are not going downward, are they?  The precious metal closed the week at $1049.20.   It is obviously a difficult time in the economy; the recession may be over and signs of recovery being seen (at least according to Fed Chairman Ben Bernanke and Treasury Secretary Tim Geithner), but to many Americans, it doesn’t feel like a recovery is underway.

Personally, I am still feeling a bit chilled.   Unemployment levels have hit 20 year record levels, the market is still jittery and easily spooked, and in talking to those around me, I see unhappiness in their eyes.  The latest painful new number is that there are at least six applicants for every job available.  When you consider that some of those jobs are high paying and others extremely low paying, the chances of any applicant getting what they were accustomed to can seem very bleak.

But I am determined to feel better about the future of our economy. I see from various indicators that recovery is, indeed, underway in the United States and many parts of Asia.  The most developed countries in the Mideast are also well on their way to recovery.  The professionals who like to suggest what is ahead say that European nations are falling behind, but expected to eventually recover, too.

I’m finding this to be good news because even though I can still see the unhappiness of those affected by difficulties in their job track, I see that recovery is ahead.  The old saying “This too shall pass” has always been one of my favorites.   I hope we shall see some benefit from what we are currently going through and that, too, seems to be underway.

They say that Americans are cutting down their use of credit.  We are learning to pay for things as we go, instead of putting off our obligations.  We are learning to value the things that we have instead of constantly running out to buy the newest, latest, most flashy, most hyped items.

Gold is an investment of both real worth and emotional value as well.   So, is it time to buy or sell gold?  If you are looking to sell, this might be a good time to do that.   A true recovery (even a “jobless recovery”) has the potential to reassure investors about the U.S. dollar, which might influence the price of gold downward.  The price of gold could inch upwards a little more, but if recovery does take hold, it will likely start to slowly dwindle.

If you are going to buy gold jewelry for special occasions including the holiday season, this is an equally good time.  The price could still hike slightly, and currently jewelers like many other types of retailers are interested in moving their products.  Special prices, free shipping and other accommodations are more likely now than they are when the economy is on firmer footing.

I encourage you to look around at the “experts” on the economy and decide for yourself whether this is the moment for you to make a truly worthwhile investment in gold.

Jittery Gold Market Effecting Gold Jewelry Prices?

It’s a jittery time in the gold market.  Prices go up.  Prices go down.   And what does that really mean for lovers of fine gold jewelry?

Two weeks ago, the price was at a peak: $1011 per ounce.  It was a heady time as one analyst predicted that the price “could go as high as $5000 per ounce” in the unsteady market.  I must admit, I reported that here in the gold prices section of the blog because I enjoy watching the wild swings of so-called “experts.”

Gold, as we’ve discussed many times here, is seen as a hedge against inflation and a stable shelter from a market that is unsteady.  It’s a place to put cash that will retain its value and in very uncertain times, even grow.  You can easily understand why its a point of heavy interest during an economic recession such as the one we have just experienced.

In the last month, the price jumped on news about the economy.  First the price seemed to ease back.  That was on reaction to the head of the Federal Reserve suggesting that the recession was over.  The markets seemed to lap that up like a cat with a saucer of milk.

Then the news about unemployment.  We seemed to be having a “jobless recovery.”  That is a situation where the American economy moves forward, begins to expand and grow again, but companies are producing more without calling employees back to work or making additional hires.  The Fed Chairman allowed that “jobs will lag behind,” but this time of “recovery” is discomfiting to most people watching the markets.  And the price of gold went up.

Now economic news seems to show some stability.  And the price softens just a little.

It does somewhat hit you where you live, if you live in a jewelry store.  Prices at ApplesofGold.com have held fairly steady through this.  But what if the price did spike again?  And what if it spiked more than a few dollars?

Apples of Gold prefers to hold its prices steady.  Like most merchants, we’d like to offer high quality product as reasonable prices and serve our customers needs and desires.  If the price of gold skyrockets, if it perhaps doubled, then yes, the prices would reflect that.  So while it’s enjoyable to report on speculative talk from imaginative “experts” on gold, we are glad to see the price trending downward again.

And we hope you are enjoying that view as well.

End of the Gold Bull Market?

Watching gold prices again?  They are still down.  In fact, some are calling the end of the bull market on gold.  I saw this headline when I look around the internet to see the mood of the market:

How the Gold Bull Market Ended

That’s pretty stunning, isn’t it?  It was posted on a website that claims to be watching the gold market as well as other precious metals and commodities.  (You really have to watch who you are getting your “news” from on the Internet these days, don’t you agree?)

Some of the information in the article is true; some parts are speculative and seem to be from a somewhat reactionary writer.  Let’s discuss what we know about gold prices and how they relate to the rest of the market.

We are in the midst of one of the more disconcerting times we’ve known in recent years.  Financially, it’s frightening, worrisome, depressing, and yet at some moments, exhilarating as we get a glimpse of the economy struggling to regain strength.

In the case of gold, the price shot up earlier this year to $1000 per ounce, months ahead of market predictions, which said the price would reach the $1000 mark by September or perhaps even October.  But there it was in the first 3 months of the year.

What did those within the market say?  They were aghast.  They were particularly shocked to see some retailers selling gold at prices that were below the market as they unloaded their stocks to show profits, but those profits would be eaten up by items sold below “replacement stock value.”

Ouch.  The jewelers couldn’t maintain that for very long and with the demand goosed upwards by frightened investors fleeing the stockmarket for the (relative) security of the precious metals market, the price went up until it simply couldn’t sustain itself.

Also we are seeing some improvement in consumer confidence that is buoying up the market prices and making everyone feel a little bit calmer and perhaps less interested in buying gold at over-inflated prices.

So if you sold while the market was high, we are very pleased for you.  If you bought while the market is high, we suggest you enjoy those pieces for a very long time to come.