In recent months gold prices have risen dramatically, first breaching the US$1000 barrier, then jumping another 20% in the past few weeks, surpassing US$1200 before correcting downward again to around US$1100. Some gold-bug bulls say the gold price could eclipse US$2000 in the next couple years. Is that possible? Is the recent rise of gold prices justified by fundamentals? An analysis of the facts suggests that a good part of this rise in gold prices is driven by a bubble.The rest of his report his behind a premium wall.
But the gist of his report can be gathered from his Twitter post on the subject:
"The New Bubble in the Barbarous Relic that Is Gold" Buy Spam rather than GoldLike a dutifully religious Keynesian, Roubini has an obvious disrespect for gold. Who needs gold when you have Roubini around to tell each country how much paper money to print?
I am a gold bear at the present time, simply because the Fed is not printing money, so gold is ahead of itself. However, I have not stepped into the Keynesian church that worships paper money. Paper money printing will only bear false profits.
Larry Summers was partner in RGE Economic Monitor. The same Larry Summers who authored the blueprint of gold price manipulation. NR is helping his boy out.
ReplyDeletehttp://online.wsj.com/public/resources/documents/disclosure-LSummers04032009.pdf