From Bloomberg.com, Oct 22, 2009:
Gold fell for the first time in a week as a rebounding dollar eroded the appeal of the precious metal as an alternative investment.

The U.S. Dollar Index, which measures the greenback against six currencies, rose as much as 0.7 percent from a 14-month low yesterday. Gold reached a record $1,072 an ounce on Oct. 14.

“A stronger U.S. dollar shall unleash strong gold sellers,” said Dennis Gartman, an economist in Suffolk, Virginia, and the editor of the Gartman Letter.

Gold futures for December delivery fell $5.90, or 0.6 percent, to $1,058.60 an ounce on the New York Mercantile Exchange’s Comex division, the first loss since Oct. 15.

December gold trading set a record high today: $1045/ounce, beating out the record of 1033.90 from March of 2008.

The Wall Street Journal gives these reasons for the soaring prices of gold: “Gold, which began a bull market early in this decade, has been further boosted in recent weeks on concerns about the dollar and the potential for inflation when the global economy recovers, given the stimulus efforts from central bankers and governments around the globe. Investment demand has offset reduced demand in other sectors such as jewelry.”

Are we looking at steep inflation in the months and years ahead?  No one knows for sure (although there are lots of opinions to be had) but many people are clearly following the “better safe than sorry” line of thought.

In the West, we think of the wedding season as spring and early summer; isn’t being a June bride considered lucky? In India though, the height of the wedding season is during Diwali (beginning on Oct 17, 2009), the Hindu festival of light. During this time, thousands and thousands of weddings are performed throughout the country and at each of these weddings, the bride is fairly dripping in gold jewelry. Her arms are covered in bangles, her fingers are sheathed with rings, and she wears elaborate gold earrings. India is the world largest consumer of gold and with the fluctuating prices, dealers are hoarding gold beginning now to help satisfy the upcoming demand. Experts do not know how, if at all, this will affect the price of gold around the world, but gold bugs and professionals alike will be keeping a close watch.

Gold hit a two month high today, topping $970 per ounce. This comes as no great shock, as the dollar has been losing face in recent days.

From Reuters:

New York gold futures finished with modest gains on Monday after hitting a six-week high, as an oil price rally and sharp declines in the dollar supported the yellow metal. An increased platinum output and a projected pick up in demand reported by Anglo Platinum (AMSJ.J) provided a strong underpinning for the metal used in vehicle autocatalysts and jewelry, as well as the rest of the precious metals.

Apparently, unbeknownst to most of the world, there is a little town in Washington state called Gold Bar. Located in Snohomish county just off route 2, Gold Bar began life as a prospectors camp in 1889, named by a miner who found traces of gold on a river gravel bar. The town then became a construction camp for the Great Northern Railroad where anti-Chinese sentiment was inflamed by a shoot out begun by camp followers. To save the lives of the threatened Chinese, construction engineer Eduard Bauer slipped them out of camp in hastily-constructed coffins. The 1940 population was 307 and the population according to the 2000 census was 2,014.

From WSJ.com today:

Weakness in the U.S. dollar and chart-based factors enabled gold futures to rally to their most muscular level in five weeks on Monday.

Analysts also cited some buying in anticipation that prices will move higher later in the year on inflationary concerns.

August gold rose $11.30 to $948.80 an ounce on the Comex division of the New York Mercantile Exchange. September silver climbed 22.2 cents to $13.625.

August gold hit a $955.40 high that is the strongest level since June 12. September silver peaked at $13.75, its strongest level since July 2.

The markets built on upward momentum developed last week, said Carlos Sanchez, associate director of research with CPM Group.

“We saw a large retreat occur today in the dollar,” he continued.

As the gold pit was closing, the euro was up to $1.4209 from $1.4101 late Friday. The single European currency hit a $1.4250 high that was its strongest level since June 5.

Meanwhile, the September dollar index was down 0.385 point to 79.120 and was as weak as 78.925, its lowest level since June 3.

“If it’s above 80, everything (gold and other precious metals) tanks,” said Daniel Pavilonis, Lind-Waldock senior market strategist. “If it’s below 80, everything rallies.”

Technically, gold has been helped by its ability to hold above $900 earlier this month despite being in the period of historically softer summer demand, Sanchez said. Gold has been on the upswing after bottoming at $904.80 on July 8.

“As prices moved higher, you pulled in some investors and speculative activity,” he said.

Some are looking toward autumn, when demand tends to pick up ahead of a number of gift-giving holidays around the world. And, said Sanchez and Pavilonis, there are concerns about longer-term inflation.

“More people are calling up to open accounts,” Pavilonis said. “They see inflation over the horizon going into next year.”

In fact, concerns about rising price pressures and the soft dollar are supporting commodities in general, he said. As gold was closing, the Continuous Commodity Index was up 4.22 points to 409.27.

As gold broke above chart points, short covering likely was occurring, said George Gero, vice president with RBC Capital Markets Global Futures. Traders will be watching the release of open-interest data on Tuesday to confirm this.

Today, let’s take a look at  gold in Italy.  We said all along that gold is an asset worth having because of the fact that it has never lost its value, and indeed has increased its value as the dollar has plummeted.

What about against other currencies though?  In Italy, there’s a measure before the legislature to tax capital gains on gold to lessen the current deficit there (Wall Street Journal). They wouldn’t be taxing it if they didn’t think it would bring them some serious money, so that’s further proof that gold is an incredibly important addition to any portfolio.

From Bloomberg
“Gold, little changed in Asia, may gain as the dollar weakened against the euro, boosting demand for the precious metal as an alternative investment.

With the last year’s financial crisis still looming with no end in site, gold is still one of the best performing commodities in the world. It has never been at zero, has never lost it’s value. You can get you gold here, at Gold Made Easy.

From WSJ online:

August gold futures are expected to open floor trading in New York around $7 an ounce higher Friday, based on electronic activity ahead of the pit session at the Comex division of the New York Mercantile Exchange. September silver is expected to be up 25 cents an ounce.

A weaker U.S. dollar and chart-based strength enabled spot gold to advance during overnight trading, London-based analysts said. At 7:51 a.m. EDT, spot gold was trading up $6.85 to $946.

In other markets that have the potential to impact metals in the short term, the euro is up to $1.4084 from $1.3988 late Thursday afternoon. In screen trading ahead of the pit open, the September S&P 500 futures are down 1.10 points to 915.50. August crude oil is nearly flat, down 6 cents to $70.17 a barrel in overnight activity.

U.S. economic data start with May personal income and spending due out at 8:30 a.m. EDT (1230 GMT), forecast to be up 0.2% and 0.3%, respectively. The University of Michigan consumer-sentiment index is scheduled for release at 9:55 a.m. EDT (1355 GMT) and is forecast to hold at the 69 reading from the middle of the month.

You can buy your gold or silver here at Gold Made Easy.com!