Can someone please provide a brief rationalization regarding the underlying price of gold? What drives the price other than supply/demand? Is it tied to the weak US dollar? Thanks.
That’s a big question. An answer that can’t really be answered in a post, but go read a book on it.
I’d rather just hit the easy button at Staples…
haha, we all would. Short answer, yes, it is tied to a weak dollar. But not always.
Yes, tied to weak dollar and fears of further instability. Also, I suspect that Gold will continue to do very well for at least 6 months, probably a year, possibly 2. Rationale: we’re headed for stagflation, and gold is about the only thing that performs well in that environment. That means a ton of demand as people shift out of stocks and bonds into something “real.”
Run a 30-40 yr comparison on Bloomberg for Gold and any major US equity index and/or the US Dollar. You’ll find your answer there…