Profits and Prophets: July
From July 2006
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The Gold Standard
By Art GarciaGold has been worth its weight — and more — as it’s ridden a steady bull run since early 2002 that took its price to $692.50 an ounce on May 9. The upward charge was part of a commodities-
market explosion that in April lifted gold above the $600 mark for the first time in 25 years. A year earlier, gold traded at $436.50. Silver also went along for the ride, hitting a 23-year high at $12.56 an ounce.
While a falling U.S. dollar against the euro and other European currencies can cause a spike in the price of gold, geopolitical tensions that have been supporting gold can work the other way, influencing a drop in prices. For instance, a hike in interest rates, such as China implemented, can mean lower metals production and lower prices from the country with the world’s largest population.
$2,000 an Ounce?
Despite the caveats, some respectable gold traders are looking for gold to reach $750 an ounce in 2007. The more adventurous are predicting $2,000 an ounce over the next two years. And while gold and silver have been making their dramatic runs, other metals (uranium, zinc, copper, lead) and oil also have seen rapidly rising prices.
Continued...
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