Gold, after climbing for 12 years, stumbled badly in 2013. It lost 28%, its worst annual showing since 1981. And the near-term outlook is hardly auspicious. The US Federal Reserve is set to print slightly less money from now on, while in the developed world inflation has eased and long-term interest rates have risen.
So adjusted for inflation, yields are turning positive. All this implies that the global economy and financial system are gradually beginning to get back to normal – bad news for an asset that thrives on bad news and doesn’t pay interest.
Still, as Longview Economics says [...]
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