A Stormy October, but Not for Gold
Is the world waking up to the economic reality Peter Schiff has been warning about all year long? With the current chaos in the stock market and rise in the price of gold, mainstream commentators and economists around the world are starting to wonder if stocks really are in bubble territory. All sorts of technical indicators are driving speculative investors to seek the safe-haven of gold. Take a look at some of these ominous indicators highlighted by the Economic Collapse Blog:
- The S&P 500 and Nasdaq Composite experienced the worst three-day decline since 2011.
- The price of oil is plummeting, which happened just before the 2008 financial crisis. Oil hasn’t been this cheap for two years.
- The Volatility Index (VIX) is at its highest since the European debt crisis, indicating a lots and lots of fear on Wall Street.
On Monday, CNN’s Fear & Greed Index hit zero, a level it hasn’t touched since 2011, right after Standard & Poor’s downgraded US debt.
Meanwhile, compare this to gold. As of yesterday, the yellow metal has experienced it longest rally in two months, erasing all of its previous losses. At a current price of about $1241, gold is now up almost 4% since 2013. The S&P, on the other hand, is up only 1.4%.
Technical comparisons aren’t the only thing bolstering the case for gold this season. The Telegraph reported last month that the “super-rich” are have been rushing to stockpile large, 12.5 kilogram gold bullion bars. That’s more than 27 pounds and millions of dollars worth of gold in a single bar! Here’s some details from the article:
The sales of 1kg gold bars, worth about £25,000 each, has doubled during the three months ended August, when compared to the same period last year, according to ATS Bullion sales figures. Sales of the more popular gold coins such as the quarter ounce sovereign and one ounce Krugerrand have also doubled this year, according to figures from BullionByPost.”
Perhaps the Europeans are realizing what the Chinese have always known – that in times of economic trouble, precious metals are the only reliable investment.
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