Last Friday I had a comment on the MarketBeat post "Gold Prices: $6,300 by 2065?":
Climateer wrote:Today the Wall Street Journal's The Source blog writes:
Something rather odd has happened to all that hot speculative cash that was flowing into oil. It’s drained away and is flooding instead into gold and copper–but that doesn’t necessarily mean you should jump from energy company shares into mining shares.
Take a look at oil first. In the futures market, the price of crude surged from less than $33 per barrel in January to $82 last month, but has since drifted back to around $76.
And in truth that’s no surprise given the glut of crude and oil products that’s sitting in ships around the coast waiting for someone to buy it. Why speculate on something there’s too much of?
So, instead, the money’s coursing into gold and copper. The price of the former is hitting new records by the hour–above $1180 per ounce earlier today, compared with less than $700 little more than a year ago. The latter is hitting new highs for the year on a daily basis too.
At one level, that doesn’t make much sense. There’s no income from gold and copper and, indeed, you have to pay to store and insure the stuff if you dabble in the physical markets rather than futures....MORE