Wall Street Wants Gold Prices to Rise Above $2,000 in 2012
There is always a certain level of speculation involved when trying to predict whether gold prices will rise or fall in any given calendar year.
Historical charts for the last few years would lead you to believe that gold prices will continue to increase.
But there are a host of factors outside the traditional "supply and demand".
Market factors play a greater role in price fluctuations than in years past.
ETF's with millions of dollars under management have more influence on the price of gold than most people realize.
Individuals and companies who invest in these ETF's are not buying gold as a physical asset, but pooling together resources to essentially bet on the value of gold going up or down.
Of course, this is the draw for investors and traders, because the only way you can make money in the market is on the value of assets, commodities and stocks going up and down.
If everything stayed the same, Wall Street would be broke, both literally and figuratively.
The effect of higher gold prices on the jewelry industry has been disastrous.
Jewelry made with gold and platinum have seen significant price increases over the past 3 - 5 years.
These increases have been passed on to the consumer and in effect have made gold and platinum jewelry more expensive and harder to find.
Many jewelers have substituted gold jewelry with silver and are offering pieces of a lesser quality.
None of this effects Wall Street investors, unless they happen to own jewelry stocks that have never fully recovered from the market collapse in 2008.
In fact, Wall Street has created a new bubble that will eventually burst, just like the housing market and dot com bubbles before this one.
With world currencies like the Euro and Yen in flux, gold is the precious metal by which all currencies are valued.
But to use this as a way to create investment instruments that have absolutely no real value is very suspect.
These instruments only serve to artificially inflate the value of these precious metals and give Wall Street a new carrot to dangle in front of hungry investors looking to profit on the next big bubble.
Should gold be worth $2,000 per ounce in 2012? Absolutely not.
Are we using more gold in our everyday lives? Of course not.
Jewelry stores have very little inventory of items made with gold when compared to 5 years ago.
So this will be an interesting development to watch this year as move into a financial environment where real profits are difficult to come by and even harder to sustain.
Wall Street wants the price of gold to continue to rise, because it means an easy payday for them.
Jewelers want the price of gold to go down and stabilize, so they can get back to offering quality jewelry at fair prices.
So don't be surprised if you see your local jeweler supporting the Occupy Wall Street movement in your city.
They have a good reason to do so.
Historical charts for the last few years would lead you to believe that gold prices will continue to increase.
But there are a host of factors outside the traditional "supply and demand".
Market factors play a greater role in price fluctuations than in years past.
ETF's with millions of dollars under management have more influence on the price of gold than most people realize.
Individuals and companies who invest in these ETF's are not buying gold as a physical asset, but pooling together resources to essentially bet on the value of gold going up or down.
Of course, this is the draw for investors and traders, because the only way you can make money in the market is on the value of assets, commodities and stocks going up and down.
If everything stayed the same, Wall Street would be broke, both literally and figuratively.
The effect of higher gold prices on the jewelry industry has been disastrous.
Jewelry made with gold and platinum have seen significant price increases over the past 3 - 5 years.
These increases have been passed on to the consumer and in effect have made gold and platinum jewelry more expensive and harder to find.
Many jewelers have substituted gold jewelry with silver and are offering pieces of a lesser quality.
None of this effects Wall Street investors, unless they happen to own jewelry stocks that have never fully recovered from the market collapse in 2008.
In fact, Wall Street has created a new bubble that will eventually burst, just like the housing market and dot com bubbles before this one.
With world currencies like the Euro and Yen in flux, gold is the precious metal by which all currencies are valued.
But to use this as a way to create investment instruments that have absolutely no real value is very suspect.
These instruments only serve to artificially inflate the value of these precious metals and give Wall Street a new carrot to dangle in front of hungry investors looking to profit on the next big bubble.
Should gold be worth $2,000 per ounce in 2012? Absolutely not.
Are we using more gold in our everyday lives? Of course not.
Jewelry stores have very little inventory of items made with gold when compared to 5 years ago.
So this will be an interesting development to watch this year as move into a financial environment where real profits are difficult to come by and even harder to sustain.
Wall Street wants the price of gold to continue to rise, because it means an easy payday for them.
Jewelers want the price of gold to go down and stabilize, so they can get back to offering quality jewelry at fair prices.
So don't be surprised if you see your local jeweler supporting the Occupy Wall Street movement in your city.
They have a good reason to do so.