The National Forum   Donate   Your Account   On Line Opinion   Forum   Blogs   Polling   About   
The Forum - On Line Opinion's article discussion area



Syndicate
RSS/XML


RSS 2.0

Main Articles General

Sign In      Register

The Forum > Article Comments > Billionaire investors back a gold price rally in 2016 > Comments

Billionaire investors back a gold price rally in 2016 : Comments

By James Stafford, published 14/6/2016

The biggest gold producers in the world have seen their share prices double this year. Not only are gold prices soaring, but producers are cutting costs and slimming down.

  1. Pages:
  2. Page 1
  3. All
Great call James and certainly a safer bet than the roller coaster ride that's oil!
Alan B.
Posted by Alan B., Tuesday, 14 June 2016 9:55:26 AM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
The question is why.

I read a while back the George Soros was getting out of non gold investments in the US and into gold citing a loss of confidence in the US and the global economy as factors.

Yesterday I read an article by Paul Craig Roberts, former United States Assistant Secretary of the Treasury for Economic Policy under President Reagan is growing ever more concerned about the prospect of nuclear war with Russia because of the influence of the neocons and particularity under a Clinton presidency.

Are these two factors related?

I'd like to know more about whats driving the price of gold. I expect to hear the usual stuff about supply and demand factors and these may true to some extent, but are there other factors as well?
Posted by Referundemdrivensocienty, Tuesday, 14 June 2016 5:35:07 PM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
More than anything else, gold prices are driven by speculation. There've been a lot of gold price rallies, but since the GFC none of them have lasted.
Posted by Aidan, Tuesday, 14 June 2016 9:19:11 PM
Find out more about this user Visit this user's webpage Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
The gold price is being manipulated downwards, and although I'm no expert I assume they can't keep the price down under the current market conditions.

There's 500 ounces of paper gold contracts in the futures market for every ounce of physical gold, and the gold price is determined in this paper market.

They manipulate the gold price by shorting the market.

They dump huge amounts (tons) of gold onto the market in these paper contracts which drives down the price of gold.
This in turn sets off the stop loss orders of the hedge funds.
It sets off the margin calls and the price collapses more.
Then they go back in and buy them back at the lower price covering their shorts and pocket the difference.

A possible Brexit and collapse of the Euro may contribute to a gold price rally as well.
Posted by Armchair Critic, Wednesday, 15 June 2016 7:51:07 AM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
Now that Brexit has happened there is potential for complete disintegration of the EU as other nation states consider referendums and exiting the bloc as well.

Netherlands, Denmark, Sweden, Austria, Italy, Finland, France...

The political uncertainty (and backdrop of impending wars) may contribute to a move to safe havens such as gold.

The author has mentioned gold producers currently enjoying increased profitability and share prices for their operations on the back of a better gold price, and a similar situation now may also exist for oil producers, given that I heard Saudi Arabia has announced it will reduce production to stabilize its own economy (with a higher oil price), which has been suffering recently.

I wonder if options trading in oil (and gold) producers would provide maximum exposure (and a tidy profit) to this change in underlying fundamentals?
Posted by Armchair Critic, Monday, 27 June 2016 4:37:08 AM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
Correction: Oil is still a no-go as Iran is ramping up production and Saudi Arabia has not yet made any agreement to cut production.

http://www.ft.com/fastft/2016/06/22/saudi-may-return-to-oil-balancing-role-says-energy-minister/
Posted by Armchair Critic, Monday, 27 June 2016 4:45:54 AM
Find out more about this user Recommend this comment for deletion Return to top of page Return to Forum Main Page Copy comment URL to clipboard
  1. Pages:
  2. Page 1
  3. All

About Us :: Search :: Discuss :: Feedback :: Legals :: Privacy