Gold Soars While Bonds Suffer
After all the drama you’ve read about today — bond woes, the dollar’s decline, yesterday’s stock sell-off — you can’t be surprised to see gold on the up and up. The spot price has risen $20 in the last 24 hours, to just over $955 as we write.
The World Gold Council trade group,” says fund manager and friend of Agora Frank Holmes, “reported today that investment demand for gold hit an all-time high in the first quarter of 2009.
“The WGC said investment demand for gold reached nearly 600 metric tons, more than triple its level during the same period of 2008. The vast majority of those additional tons went to gold exchange-traded funds, which grew from 73 metric tons in the first three months of 2008 to 465 metric tons in the latest quarter.
“Overall, gold consumption of 1,015 metric tons in the first quarter of the year was up 38% from the same period in 2008. Total gold supply was up 34%, with much of that increase coming from recycled gold.
“Normally prices rise when demand growth exceeds supply growth, particularly when speculative demand is soaring. But that wasn’t the case in the latest quarter — gold averaged $908.21 in the three-month period, down 2% from a year earlier.”
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