Gold has fallen below $1650, while Putin is buying
I don't know what is the exact reason for gold plunging $20 down today, by my advice is the same as in similar situations - buy. Use the cheap moment and buy. Till the end of the week I expect you will make at least $20-30 profit, and in mid and long term - $50-100. Gold is deeply devalued at the moment.
A more interesting news from last days was the Bloomberg analysis that Putin is converting more and more of Russian currency reserves into gold. The Russian President that proved to be an extremely successful manager by dragging out his country from poverty to an European mid-level standard, thinks that in a case of a collapse of the Euro or the Dollar, counties with higher Gold reserves will be better. So Russian Central bank is the biggest net-buyer of gold in the world.
In upcoming months the money print will have to be accelerated again, as no economic problems are resolved, and the energy of previous money print round to postpone the crash is exhausting. Spain and Italy are facing new increases in interests on their bonds, and the French President Hollande is dreaming of a cheaper Euro. Additionally in USA no serious spending cuts are planned, and a new retreat from real reforms is prepared by dominating in Government Democrats. Republicans are just signing everything. And in Japan the new officially announced policy is of money print for devaluing the Yen.
Obviously the "currency war" is the global protectionist choice. At the end the only winner will be Gold.
It is a stupid protectionist choice. It is a type of "hidden" protectionism that is known and practiced by everyone. I.e. it is a stupid protectionism. The right way is the real and honest protectionism that I call a neo-protectionism. But obviously it is much over the mind capacity of current politicians.
Finally - $1650 is a perfect "buy" price...
Feb 11th 2013