From Adrian Ash<\/p>\n
\nBullionVault<\/a><\/p>\n \n“Bubble”, Hits 3rd Dollar Record This Week<\/strong><\/p>\n \n <\/strong><\/p>\n THE PRICE OF GOLD<\/strong> broke new Dollar records for the third time this week in London trade Friday morning, peaking above $1282 per ounce as world stock markets extended their 2% gains from Monday.<\/p>\n \nMajor-economy government bonds also rose, pushing interest rates lower as new German and US data showed inflation stalling on the official measures in August, while crude oil recovered above $75 per barrel.<\/p>\n \nSilver rose once again too, sitting just 7\u00a2 off a three-decade high at the London Fix of $20.85 per ounce, and gaining 5.0% from last week.<\/p>\n \nThe Dollar rallied from near 6-week lows to the Euro, which held gold at a 0.7% loss from last Friday’s finish at \u20ac31,415 per kilo.<\/p>\n \nBy the start of New York dealing today, gold<\/a> priced in Dollars stood 2.4% higher for the week, nearly 29% higher from this time last year.<\/p>\n \n“Unambiguously…gold price developments do not resemble the statistical characteristics of past bubbles, including those of the US housing market, the Nasdaq technology bubble, and the Japanese Nikkei equity market bubble,” says a new research paper from research and advocacy group the World Gold Council.<\/p>\n \nCiting the statistical “z-score” \u2013 which shows gold avoiding out-sized moves \u2013 “The gold price is [also] consistent with its long-run average level compared with a range of different assets, including equity indices and hard assets like oil,” says the WGC.<\/p>\n \nHedge-fund legend George Soros \u2013 whose Soros Fund hold a $645 million in gold \u2013 yesterday repeated his comment that gold is “the ultimate bubble”.<\/p>\n \n“Clearly interest is building with the price movement,” said US Gold CEO Rob McEwen, formerly of world No.2 gold mining stock, GoldCorp, in a Bloomberg interview earlier this week.<\/p>\n \n“The trend is up, that’s what people should focus on, that’s the important part.”<\/p>\n \nAsked about Soros’ view, “People are worried about all the money that’s being printed,” said Diane Brady, senior editor at BusinessWeek<\/em> in New York, speaking to the BBC World Service last night.<\/p>\n \n“They look at the alternatives for where to put the money they already have, and they really do not see a lot of options other than gold.”<\/p>\n \nHelping support the current gold price rise is also “a rise in physical demand,” says the latest ABN AMRO Metals Monthly<\/em> from London’s VM Group consultancy, citing last month’s 13% rise in Indian imports and strong demand in Vietnam following the 5% devaluation of the Dong currency.<\/p>\n \nDismissing speculation that the People’s Bank of China is buying gold<\/a> at current prices, “[Private] gold demand in China is nevertheless up 40% this year,” says VM.<\/p>\n \nOn the supply side \u2013 and despite current prices standing over $600\/oz above gold mining cash costs \u2013 “the gold market remains tight as production rates fall behind demand growth.”<\/p>\n \nThe lack of European central-bank sales, plus emerging-market states buying gold<\/a>, “is giving a very powerful bullish signal.”<\/p>\n \nAdrian Ash<\/p>\n \nBullionVault<\/a><\/p>\n \nGold price chart, no delay<\/a> |\u00a0\u00a0 Buy gold online at live prices<\/a><\/p>\n \nFormerly City correspondent for The Daily Reckoning in London and head of editorial at the UK’s leading financial advisory for private investors, Adrian Ash<\/strong> is the editor of Gold News<\/a> and head of research at BullionVault<\/a> \u2013 winner of the Queen’s Award for Enterprise Innovation, 2009 and now backed by the mining-sector’s World Gold Council<\/a> research body \u2013 where you can buy gold today<\/a> vaulted in Zurich on $3 spreads and 0.8% dealing fees.<\/p>\n