End of QE2 a buying opportunity for gold and then off to the races
Posted on 23 May 2011 with 2 comments from readers
UBS precious metals strategist Edel Tully hit the nail on the head for gold in this interview with Bloomberg last week. However, with so many people waiting for a summer buying opportunity in gold and silver we are beginning to wonder if it will happen.
What if bond markets come down before or alongside stock markets? Then you could see a rush into precious metals at the same time as a falling stock market. Actually it looked that way today in Europe with bonds and stocks weakening together and gold heading to a new high in euros.
This sort of sell-off is deflationary and ought to be bad for gold but not when it acts so clearly as an alternative currency, and the same can be said for silver whose rebound might confound some speculators who want to buy more cheaply this summer. A buy-and-hold strategy in a rising bull market eliminates this sort of hit-and-most-likely-miss approach.
2 Comments posted by readers:
Good comment, Ed.
One thing is clear to me, regarding this “new” relationship between the general stock markets and the price of gold/silver. The gold/silver Cartel, orchestrated by JPM/HSBC/GS/CBOT/CME/CFTC/COMEX/FED et al will try mighty hard to keep the gold and silver price down, as the general markets sink.
But they can’t hold it down forever!
Why don’t other experts link in a fall in both bond and stock markets to what might happen to g and s, except yourself. Seems the obvious thing to do!
I mean we’ve never seen bond markets in such a gigantic mess before, not in short to medium term history, yet g and s, we are told, will rise simply because more and more investors invest and will keep on doing so. Linking it to the bond market in particular, gives a very important reason as to why this could happen.
To be fair, that guy who worked with Reagan did talk about a conflagration of bonds, which is a “helluva” a description when you come to think about it.