The precious metal comes close to US$ 1,660 an ounce today. Viewed as a “protective hedge” against the problems of European and US public debt, it could reach US$ 3,000 by the end of the year. Its rise highlights the vacuum created by a financial system incapable of generating wealth.
Rome (AsiaNews) – The price of gold rose again today, following an upward trend of almost 11 years. Yesterday, it closed just shy of US$ 1,600 an ounce. For analysts, the rush for gold is turning into a “frenzy” as investors try to find some “hedge” to protect their wealth against the abyss of European and US debt.
Under pressure from the International Monetary Fund, European governments will meet again in Brussels this week to reconsider the Greek debt. In the United States, President Barack Obama is trying to cope with the possibility that the ceiling of the US public debt may not be raised in time at a time when rating agencies are threatening to downgrade the US credit score.
This year, gold rose 13 per cent, its greatest increase in 90 years. According to analysts, the debt crisis might push the precious metal above US$ 1,650 an ounce by the end of the year, twice what it was just a few years ago.
Since China and India (and other emerging nations) are among its greatest buyers, gold might reach US$ 5,000 by 2020.
For economist Maurizio d’Orlando, “we could already see the price of gold double by this fall.”
“Some time ago,”, d'Orlando added, “I calculated that if we took the world’s monetary liquidity as expressed in the main reserve currency, the dollar, and we divided it by the amount of actually available gold, we could reach absurd figures, around US$ 30,000-60,000 an ounce.”
The real problem, according to the economist, “is that there is so much financial paper around and few goods of real value”.