A large number of investors are understanding the significance of having gold and are making the most of the existing reasonable prices to do this. Hedge funds are currently repositioning to the safety provided by gold. Hedge funds are the most optimistic on gold since late August. This attitude comes in the wake of the dive in worldwide equities which has wiped out more than $2 trillion from the value of the stock market.
According to a well regarded United States Federal reserve insider, gold prices will improve in 2015 as demand in China and India dramatically improves.
Many European countries, have been tipped off that the American Federal Reserve does NOT have the physical gold that is supposedly on deposit in the U.S.. They have asked that their gold reserves be returned. Austria is the latest country to demand their gold reserves; following recent demands made by France, Netherlands and Germany. It is believed that the U.S. Fed sold the gold reserves years ago and must now buy the gold at current prices. The Fed have informed European central banks it may be 2020 before they will make good on the gold bars.
Dropping Oil Prices
Presently, oil prices are trading near 5 year lows. As a consequence of dropping oil prices, Russia is experiencing a full-blown economic meltdown. Combined with global sanctions and untamed currency printing by the Central Bank of Russia, the dropping oil prices have become disastrous for the Russian economic system. To this point, in 2014, the Russian currency unit the ruble has declined 50 percent against the American dollar.
Indeed there is an additional unwanted effect of crashing oil prices which market players need to be ready for: The imploding price of oil could stir up geopolitical tensions in leading producing countries. For instance, Iraq - that is fighting Islamic State (ISIS) militants - will certainly take a substantial hit from the crashing price of petroleum. Ultimately, the problems will certainly spread to other countries. The ruble's break down has evoked the upheaval of the 1998 Russian meltdown, an event that was felt through financial marketplaces around the globe.
The Recent Fed Statement
Recently, The Fed has made another perplexing statement by the end of the recent Federal Open Market Committee (FOMC) meeting. In their report, the Fed said they will be "patient" prior to starting to increase rates. The Fed stated this was "consistent" with their "considerable time" promise made following the previous few FOMC conferences.
Investors have no idea just what the Fed was attempting to convey, as shown in the market's rocky reaction. Minutes following the release of the Fed report the American dollar, Treasury yields and crude oil sold off, rallied and then fell once again.
It Is Worth Noting That Elliott Wave Technical Experts Have Recently Spotted The Potential For Huge Gold-and-Silver Price Increase By Early 2015. Buying gold and silver bullion in the form of bars and coins simply looks like a good idea right now.
Copyright 2014 RGG SYNDICATION
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