Of late, I have read a number of analysts, Jim Rogers even, who have expressed
the view that gold could dip to the mid- to low $600 level.
It could happen, but I think not. Already, buyers of physical gold are
finding anything near $700 to be cheap and are helping to build a floor under
the monetary metal. On that topic, a friend sent this item along recently:
(Gulf News, Nov. 12) Riyadh: There has been an unprecedented
demand for gold in the Saudi market recently, with over 13 billion Saudi riyals
($3.47 billion) being spent on the yellow metal during the prior two weeks.
Demand is expected to rise still higher as more investors turn to gold as a
safe haven in the midst of the global financial crisis, according to market
sources.
Sami Al Mohna, an expert on the gold market, said the trend had resulted in a
substantial rise in the gold reserves of Saudi investors.
Since soaring to an all-time high of $1,033.39 per ounce in March this year,
gold has plummeted 30%.
Gold for December delivery on Monday rose $8.60 to settle at $726.80, roughly
the same level at which it traded a year ago.
"Many Saudi investors see this as the right time for making investments in
gold as its price is the most reasonable one at present," said Al Mohna.
Needless to say, the Saudis have a lot of money. Not just a lot… but a
really, really, big, stupendous mountain of the stuff.
And like you and me, they’re human. The urge to buy gold this cheap is a
pining all gold bugs around the world are feeling.
We are getting regular reports that, at these prices, demand is soaring in
India (where price inflation is now running around 11%), and brisk sales have
pretty much wiped out physical supplies of small coins and bars in the United
States and Europe – among other corners of the world.
On that score, a few days ago, correspondent Jim G. sent along the
following:
Most of you are probably aware that there’s a shortage of gold bullion coins
at the retail level.
What does that mean?
Today I decided to purchase some gold bullion coins. So I called the
Northwest Territorial Mint, one of the larger operations in the country, or at
least the Northwest, so I’ve been told.
I called to see what the availability was. The operator put me through to
sales, where I sat for 30 minutes. I finally got in my car and drove 40 minutes
there, all the while still on hold. When I finally got there, a woman went in
the back to see about bullion coin availability. She was told they were
back-ordered with 30,000. Not dollars, orders. If I placed an order
today, they thought they could fill it in 16 weeks.
To sum it up, I’m buying – if you happen to know a seller.
