GREY:GUYFF - Post by User
Post by
moreDDon Aug 12, 2014 12:38pm
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Post# 22832651
Gold and higher interest rates
Gold and higher interest ratesis the talk i hear all the time especialy from goldman...the story goes like this...higher interest rates influence the oportunity cost of gold therefore make it less atractive as an investment in a higher interest rate inviorment...but what most forget to say is that we need US economy to realy pick up pace in order to raise the rates to a more normal level...once you see economic activity picking up as it seems to be as of late per statisticks you also see in a consumer driven economy a pick up in velocity of money in circulation...that pace of money changing hands is what makes inflation go wilde...so my argument is that in order to see gold move up to that 2000 level we need global growth and more than that US growth of more than 3.5 % per annum with strong consumer sentiment...you can have both dollar rising and gold rising as we saw for the last 2 weeks...