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Gold Breakout, Three Years Ago to the Day

Commodities / Gold and Silver 2011 Mar 17, 2011 - 11:56 AM GMT

By: Adrian_Ash

Commodities

A quick reminder of recent history...

REMEMBER Bear Stearns? You know, that quaint little investment bank which blew up 6 months before Lehmans and a full 12 months before quantitative easing began.


Here's a reminder...

Gold $/oz PM Fix

You can see the exploding bank right there...that little spike just above $1000 per ounce in the gold price...three years ago to the very day.

Here at BullionVault, we'd already had the world's very first Thousand Dollar Gold Trade four days earlier, when gold first tip-toed up to that level. A Canadian user, seeing the wholesale-gold "spot" price nearing four digits, had offered and sold his five ounces of gold – stored securely in Zurich, Switzerland – to a Hong Kong investment fund for $1000 a pop.

Come the Monday, and as Bear was sold to J.P.Morgan for 7 cents on the Dollar, gold then hit what would prove an 18-month top. Which made our Canadian client look awfully smart, not least as everything bar the Dollar and Japanese Yen tumbled into the black hole marked "Lehmans".

Selling what had doubled in barely two years also looked smart...and might still today. Gold's rate of ascent since 17 March 2008 has been better than stocks, bonds and pretty much everything else (except silver). But at 36% in the last 3 years, it would seem to have slowed.

Gold $/oz PM Fix log scale

Whatever slow and steady trend gold began rising on a decade ago, however, it doesn't seem to have hit its true peak just yet.

By Adrian Ash
BullionVault.com

Gold price chart, no delay   |   Buy gold online at live prices

Formerly City correspondent for The Daily Reckoning in London and a regular contributor to MoneyWeek magazine, Adrian Ash is the editor of Gold News and head of research at www.BullionVault.com , giving you direct access to investment gold, vaulted in Zurich , on $3 spreads and 0.8% dealing fees.

(c) BullionVault 2011

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


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