Tuesday, August 2, 2011
Last hurrah for gold
I have already written about gold being in a bubble, as are all commodities, but this issue bears repeating - gold is grossly overpriced and will crash. At $1,640 or so this morning, we are seeing the last push of the shinny metal before the realities of inflation taming actions by the Fed, slow growth, and a deal on the debt ceiling signal the start of spending cuts and higher taxes. Gold benefits from uncertainty and inflationary fears, two drivers we have experienced in spades. When the music stops, make sure you have a seat!