Last year, billionaire financier George Soros said he thought gold was "the ultimate bubble". So those worried that gold could be nearing the end of its ten-year bull market have noted that he has sold most of his holdings in gold exchange-traded funds (ETFs). But does his exit and gold's latest record above €1,080 really mean that the party is over?
Don't count on it. For starters, note that Soros still has exposure to gold through gold mining shares and a gold mining ETF, says Julian DW Phillips on Goldforecaster.com. The global macroeconomic backdrop hardly suggests that investors no longer need a safe haven and store of value. While the end of the Fed's latest money-printing programme (QE2) is due in June, the recent weakness in the US economy means another round of QE can hardly be ruled out. Even if it doesn't happen, however, interest rates remain negative, which is fertile groundfor gold.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
Should the income protection age cap be lifted?You can only get income protection cover if you are below age 59. With people now working for longer, should the limit be raised?
-
UK interest rate cut all but ruled outRates are expected to remain at 4.25% when the Bank of England announces its decision tomorrow
-
A new dawn for Asian markets?Advertisement Feature James Thom, Investment Manager, abrdn New Dawn Investment Trust plc
-
The end of cheap money hits the marketsNews Markets have swooned as central banks raise interest rates, leaving the era of cheap money behind.
-
Are stocks back in a bull market or is this just a bear market rally?News The S&P 500 index gained 17% between its June lows and 16 August, while the Nasdaq Composite rose more than 20%. So are stocks back in a bull market or is this just a brief rally before they resume their slide?
-
Enjoy the bear market rally while it lastsNews Investors seem to think that a weaker US economy will cool inflation and see the Fed relent on interest rate rises. But that optimism may be misplaced, with July’s stockmarket gains looking very much like a bear-market rally.
-
The Fed really is fighting inflation – so don’t expect an early end to the bear marketAnalysis In an attempt to contain raging inflation, the Federal Reserve has raised US interest rates by 0.75 percentage points. And it’s going to keep on raising them till something breaks, says John Stepek.
-
The Federal Reserve wants markets to fall – here’s what that means for investorsAnalysis The Federal Reserve’s primary mandate is to keep inflation down, and lower asset prices help with that. So, asks Dominic Frisby – just how low will stockmarkets fall?
-
Interest-rate rises mean more pain for stocksNews Interest rates are rising around the world as central banks try to get inflation under control. That’s hitting stockmarkets – and there is more pain to come.
-
Here’s why markets welcomed America’s big interest rate riseAnalysis The US Federal Reserve raised interest rates by half a percentage point – the biggest hike in 20 years. So why did markets rise? John Stepek explains what's going on, and what it might mean for you.
