Will 2012 Be Safer for Safe Havens?

Posted by on January 16th 2012 in Bailout, China, Federal Reserve, GATA, Gold, Monetary Policy, Short Sellers, Silver, Wall Street | Be the first to comment!

As U.S. Global Investors updates its Periodic Table of Commodity Returns, and looks at “What the Next Decade Holds for Commodities,” a GoldSeek article asks if precious metals will regain their safe-haven status in 2012.  It points out that “gold and silver haven’t yet benefited from the problems in Europe and instead investors have bypassed the precious metals and have flocked to the dollar. Geopolitical and economic concerns aside, the best chance for a metal and mining stock recovery in 2012 is for a rebound in monetary liquidity.

Some analysts are optimistic about gold in 2012, in anticipation of a boost to the metal’s demand from bond buying measures by the U.S. Federal Reserve and the European Central Bank.  The median estimate in a Bloomberg survey of 44 traders and analysts is for gold to rally as much as 37 percent in 2012 to $2,140 an ounce. This may be an overly optimistic assessment, however, especially if the eurozone crisis escalates in the months ahead.

Gold’s best chance for success should occur when the European debt drama has been aggressively dealt with by Europe’s central bank and political leaders.  Once investors’ nerves have been calmed  over the eurozone debt drama we should see a reversal of the intermediate-term downtrend in gold and silver.  This will occur when central bankers are finally able to coordinate a monetary stimulus designed to bolster the euro and stabilize the bonds of the major eurozone countries.”

Related Links:

Daily FX:  Gold rally threatened by USD strength – Will QE talks time the scales?

Seeking AlphaTalk of QE3 increases as the dollar rises – Time to reposition

Financial Times:  Eye-catching ECB liquidity number du jour

Bloomberg:  Euro leaders race to salvage rescue plans

CNN Money:  S&P downgrades Europe bailout fund

CNBC:  Marc Faber:  Most Europe, U.S. ratings should be lower

Reuters:  Europe Monday:  Gold and silver gain slightly as stocks recover

Got Gold Report:  Gold and silver prices find their footing

KWN:  Keith Barron – Physical gold & silver to crush paper markets

SafeHavenGold comes alive

Tim Iacono:  All the gold bugs in China

GATA:  More traders notice gold’s regularly counterintuitive behavior

Silver MinersThe war against us

Time:  Why the smart money was so dumb in 2011

Bloomberg:  Apocalypse how? Dire 2012 forecasts

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