Tuesday 29 January 2013

Gold and more gold - its inverse relationship with the stock market

From what I understand, gold is a safe haven to all the money printing by the government, and hedge against inflation.

Read this rather interesting article about gold prices in recent weeks. Good news is, gold prices are coming down!

http://www.scmp.com/business/commodities/article/1136020/quantitative-easing-does-little-boost-gold-prices

Excerpt from the article

"Although gold has had a great run in the past decade, much of it has come in response to the uncertain times unleashed by the global financial crisis, and the liquidity injections and rate cuts in the central bank actions that followed.


The fact that gold did not react positively to QE3 reflects the view that the US economy is recovering. As it picks up, the likelihood of another round of quantitative easing decreases. Already in the minutes of the US Fed meeting held in December last year, discussion has begun about winding down QE3."


Disclaimer: The ideas expressed in this blog should not be construed as an enticement to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

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