Gold Plummet Nears $800
August 15, 2008
Gold Decline Nears $800 An Once
Another day of gold sell-offs has brought this precious metal down to about $805, quickly nearing the $800 level. Silver is also on the slide with a spot price of about $14.15 as of this posting.
Consumer price data may be leading many to look for the Fed to raise interest rates to stem inflation. With the dollar already strengthening, this would be a likely move for the Fed, but one which would lead to less desire for gold as an inflation hedge. You can really see this effect taking charge in gold futures.
As a coin collector, I would not mind a slackening in the investment end of the precious metals market. This outrageous bull market for precious metals we have been experiencing will at some level begin to really deter collectors. With gold this high, the downside risk for a collector becomes a serious factor and for the bullion accumulator a rise as fast and steep as the market experienced last winter should be a huge warning sign.
We all tend to collect what we enjoy or appreciate, in terms of atristry and culture, but I always consider potential downside in evaluating purchase price. It's not wise to get carried away with the tide of a rising trend.
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