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Activity:
361 views;
last activity : 02 21 2011 14:57:24 +0000
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Festival season & weakness in dollar
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Recent global melt down
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Strong Demand
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Chinese inclination
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Ignorance
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Supplier pulling out
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US wish to offload its gold stock.........
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Insecurity
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Gold -An asset class
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Stability and demand
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Weak Global Equity Markets.
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Less production from Gold mines
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Weakening dollar
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Financial crisis dot.com bubble and now a bubble with no imagination.
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We are all equal but why there is disparity?
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potentional investion option
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According to me september is the monthe which typically marks the start of an extended period of higher seasonal demand for gold, which spurs a lot of activity where restocking of inventories to satisfy increased demand for gold jewellery happens. The festivals have already started Ramadan celebration and then there is the wedding season that will be there & then followed by the Diwali which is the biggest festival which has holidays across Southeast Asia and then at last the Christmas. And also if one has a good tab on the history it is always seen that september is a time of weakness in the dollar which is currently working in the favour of the yellow metal. |
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The other reason is whenever there is a price rise in crude the price of gold goes up and stock market fall on top of that the unrest in middle east is another factor for price hike.
Gold demand increased in September and February because of festive and marriage season. Gold is very good investment and very good hedging option against inflation. But in these(February and September) months International Banks and IMF sell gold in interantional markets so they need higher price. Before the selling they buy gold from the markets. This is the main reason why the gold prices go upside in beganing of september and february.
The demand for Gold for usage as jewellery, as a hedge against weakening currencies, the liquidity not matched in toto in terms of risk appetite and valuations attractive enough for investing in other asset classes, increasing concerns on fiscal deficits and instability in various economies including and not limited to US economy, the seasonal demand pulls - all these point to one direction for Gold: north.
A season of festivals heightens the anticipation of a price rise spurring the demand of retail customers even more. The outlook for US Dollar being grim for the foreseeable future gives an assurance that the anticipation is not a day sooner than necessary. The empirical observation by Jyoti adds value to understanding the yellow metal. It is auspicious to talk of yellow, when it comes to metals.
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Out of the reasons mentioned above,'festival season and weakness in dollar' appears to be one of the most probable reason behind gold price surge. The other relevant factors are:(a) Central banks the world over have been flooding the market with lots of printed notes to infuse liquidity leading to investors hedging themselves with investment in gold. (b) Gold is a dependable security/hedge against the expected rise in inflation in future. (c) Gold will also come to the rescue of the investors in case the supremacy of dollar gets challenged. I have been tracking Reliance Gold ETF for quite some time. The price per unit was Rs 1322.91 on 1.1.09,Rs 1543(highest so far) on 24.2.09 and have been hovering between about Rs1400 to Rs 1500 since Feb 09 till date. Investment in any Gold ETF is desirable any time and must form a part in any investment portfolio. |
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The upsurge in gold prices can be attributed to the global meltdown due to subprime crisis in USA. Over the last few years the gold has been shining continuously but the way and to the extent this crisis have affected the gold industry no other factor had such impact on gold prices before.Over the recentyears, investors have closely observed the pattern of gold prices. The prices have not disappointed them either. They have become surer that investment in gold is the safest and most profitable option right now. Considering the fact that gold has been on a consistent rise, investment in it provides a kind of insurance cover sure to give good returns. Because of this meltdown the investors lost their faith in the capital market and they saw a ray of hope in gold industry. Considering these factors it would make more economic sense to invest in gold than to trade in fluctuating and uncertain capital market.
Today, like all investments and commodities, the price of gold is ultimately driven by supply and demand. Unlike most other commodities, the hoarding and disposal plays a much bigger role in affecting the price, because most of the gold ever mined still exists and is potentially able to come on to the market for the right price. At the end of 2006, it was estimated that all the gold ever mined totaled 158,000 tonnes. This can be represented by a cube with an edge length of just 20.2 meters.
Given the huge quantity of stored gold, compared to the annual production, the price of gold is mainly affected by changes in sentiment, rather than changes in annual production. According to the World Gold Council, annual mine production of gold over the last few years has been close to 2,500 tonnes.[11]About 2,000 tonnes goes into jewelry or industrial/dental production, and around 500 tonnes goes to retail investors and exchange traded gold funds. This translates to an annual demand for gold to be 1000 tonnes in excess over mine production which has come from central bank sales and other disposal.
Central banks and the International Monetary Fund play an important role in the gold price. At the end of 2004 central banks and official organizations held 19 percent of all above-ground gold as official gold reserves.[12] The Washington Agreement on Gold (WAG), which dates from September 1999, limits gold sales by its members (Europe, United States, Japan, Australia, Bank for International Settlements and the International Monetary Fund) to less than 400 tonnes a year. European central banks, such as the Bank of England and Swiss National Bank, have been key sellers of gold over this period.Although central banks do not generally announce gold purchases in advance, some, such as Russia, have expressed interest in growing their gold reserves again as of late 2005. In early 2006, China, which only holds 1.3% of its reserves in gold, announced that it was looking for ways to improve the returns on its official reserves. Some bulls hope that this signals that China might reposition more of its holdings into gold in line with other Central Banks.
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Apart from the technicalities, what also matters is the demand and supply. As this being the festive season and season of marriages the demand for it wld certainly b high compared to the 1st quarter..nd hence resulting to the price raise. The more the demnd the lesser the supply fr it...u wld c d imbalance nd the price raise. |
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Bastard sandeep kulkarni this you u changed
........people don t ever vote this bleady bastard, he is bleady cheater, he used many innocent girl ad escaped, Hang him where ever you see and make him spot dead or if u see anywhr just bring infront of me, if i go jail also no problem but kill this bastard atleast i get justice myself.
and lofar you ran away from
I came one mre thing bastard u became Team leader by taking help of girl, wear bangles lofar, bleady coward.
shameless creature cm infrnt of me bastard i wil give chapple vote on
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you bleady bastard sandeep kulkrni, u changed ur profile name sk and photo also crap bec the people should not recognise you, what u r? but rascal, bleady i tel whole world that what you are and bring
........people don t ever vote this bleady bastard, he is bleady cheater, he used many innocent girl ad escaped, Hang him where ever you see and make him spot dead or if u see anywhr just bring infront of me, if i go jail also no problem but kill this bastard atleast i get justice myself.
and lofar you ran away from
cm infrnt of me bastard i wil give from slipper vote that you should remember life long.
bloody f***** u never be happy in ur life , u suffer like anything whole life i never 4give u b****** nd if u ever cme in4nt i kick u 4m my leg bloody b**** son.
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Two terittories of the world have their own stron culture, i.e. India and China. In India due to festive season, more purchases of gold occure, as usual. In China, there was no tradition of buying gold. Now a days China did not faced economic meltdown problem. Life style upgraded substantially. Now there is buying pressure on gold as a commodity from china. |
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The main reason why the gold prices have gone up recently are due to heavy buying of gold by China as it is feeling that investing of the forxes reseves of the country in US markets is not safe. Recent news paper reports also suggest the same.
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I know I will be termed wrong. Indians will continue to buy gold. It happened in real estate also. Whenever I used to say that it is abnormal increase in real estate we are witnessing, people were making money in real estate and they were having a big laugh at my expense. By terming investments in real estate and gold as uneconomic, I have been laughed at very greatly. But my opinion continues to be the same. There is no point in wasting precious resources to hoard gold or invest in unproductive real estate - the only expectation is increase in value. The money exchanged in both situations is not ploughed back into productive use. |
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Buying gold as ornament for "Rainy day" is pure foolishness.
If it is just for ornament, the cost is not worth it.ornament design have a fixed time durability. They have to be changed due to trend,peer pressure,bored by self by having it for some time.Etc.So there are different other ways to ornament yourself in the same glitter.
Until it is educated that every time you buy a gold as ornament ,you have lost 25% straight.yes thats what you lose when you want to change/sell.
Gold as investment in 24 carat is a investment to an extent.Now there are lot of other ways where one can invest to profit
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According to news a few months back one of the suppliers who was meeting the gold demand was pulling out. At that time they were predicting a surge in prices and Russians were not willing or something to offset the deficit in demand/supply. Probably this is the reason. I don't remember the Organization. |
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There are various reasons behind sharp increase in prices of gold. Us may wish to offload its gold stock.............
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There is no gold in the US, read the Fort Knox fiasco, Gold is the the hands of IMF and who is IMF?, The Rothchildes, the Rockefellers, The Morgans, Ambanis, to sum up the ELITES-CORPORATOCRACY.
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The volatile state of shares/equity in the markets is the driver. |
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Festival apart,recession is pushing the gold prices.The people around the glob have immense trust on Gold trading.
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I feel Gold as a commoditiy and asset class is going up. The reason to go up again is definately at the practical level of Demand & Supply. Though physical Demand and Supply may not be the actual reason. The gold as an asset class...may have the possibilty of giving good returns....as now in india and globally one can buy gold in electronic form....You can buy commodity futures..and alternately one can buy physical gold...Also the fact that gold is rising is that smart money is perceived to have found gold as an asset class being a safe heaven..... |
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Compared to other methods of investment that depend on a physical calculation of interests for your deposits or on equity markets, gold depends on the demand purelym from customers which in turn has an effect on its prices. And unlike other methods of investment, gold neither loses its lustre nor its value. Come what may people need to use godl for their self adornment, hence there would be a perennial demand for it which it makes it a very stable instrument to invest in. |
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Weak Global Equity markets may be the reason for surging Gold. |
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Gold demand is ever increasing and shortage of supply is the real player in inreasing gold price surge. The main reason is failure of gold production to cope of gold demand is main reason for shortfall. |
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Reasons for increased gold prices 1) Rise in metal demand due to festivals like Ramadan, Diwali and also the surge due to the stock piling for wedding season. 3) In case of any expected rise in inflation Gold is considered as a dependable security. 5) Concerns related the the fiscal deficits and economic instability also spurring demand for Gold as a safer investment.
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I have been telling people to convert their paper money into standard Gold or Silver so that they can sustain the the next bubble explosion which will take almost 70% of the world economy under its sway.We have seen the (dot).com bubble and now the worst to come. Private Banks are going to get bankrupt and people those who think they are save with large sum of deposit in those Banks are fools and fools should perish, do not take long term loans, I mean any kind of loans from Banks because it is a trap to confiscate whatever collateral you have promised to a Bank. Get rid of your credit cards and other relevancy you are in contact with a Bank. Make a choice or perish without objection. I am copy pasting a link below, watch it at your convenience---
http://www.truththeory.org/overdose-the-next-financial-crisis/
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In a world where 1% of the population owns 40% of the planet's wealth… In a world where 34,000 children die every single day from poverty and preventable diseases, and where 50% of the world's population lives on less than 2 dollars a day… One thing is clear: Something is very wrong!
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In the global economic meltdown, big banks of yesterday gone to dusk. People are left with no option for investment. They considered gold as an safe investment option. Investment means, one has to invest his hard earned money somewhere where there is every possibility of its dilution, when it is investment in gold, the money invested can be enjoyed regularly while losing nothing. So people find it as a safe investment and began investing in. The demand for gold multifold in the above circumstances, while there is no increase in supply of this precious metal. So the price of the gold is high racketing. |
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@ Srinivas, well said, no increase in supply of Gold. To cite an example, during the time of Julius Caesar, A gold coin would fetch a toga, strap chappals, a knife or a scimitar.The same Gold coin would fetch you a suit, a shoe of good quality, a wrist watch of decent make in the present day. So, the value of Gold is the same. So the Banks have inflated the paper money so much that it has to explode, it has crossed its limit and that is sad really sad...
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