Showing posts from January 31, 2016

While Stocks and Commodities Deflate, Why Is Gold Up 10%?

I've been following markets for 35 years. The first equity I ever owned was called Eastern Airlines. I have not owned an airline stock since then. As I write today, the entire market is down. Oil has moved a little higher today (.13%) and gold after opening ten bucks lower this morning- is now in the green- albeit barely. (.40) Gold, after trading down and closing an old gap around 1040 in January, has rallied to 1157. The HUI or mining index, after essentially having been driven into the ground, has rebounded 40%. That is where the smart money is flowing and it's just starting. So while the markets deflate, including copper and silver to some extent, gold and gold miners are finding new life. The 64,000 dollar question is "why now?" Markets, completely overpriced and inflated by 3 trillion dollars in QE and 7 years of zero interest rates, must come down. The dollar has been coming down which has helped gold considerably. There is simply no demand for anything