Tuesday, March 17, 2009

Today in Gold: Tuesday, March 17

Each weekday, Cash4Gold will troll through the web's gold banter and post some of the bigger or more interesting stories. Following is a run-down of today's features:

"Gold the Only Credible Currency"
Author: Kishori Krishnan
Website: www.GoldInvestingNews.com

Main Points: BGF Equities analyst Warwick Grigor credits the rising gold price to the failure of other currencies. He claims that the US dollar is overpriced and confidence in other currencies is low. "The only alternative currency is gold; that is why we are seeing the gold price rising. Gold is the only credible currency right now."

On the other hand, "Gloom, Boom & Doom" author Marc Faber sees a scenario where gold could soon test the $700 an ounce mark. Although US markets have rallied, he expects a collapse by the year's end. "We went down following March 2008 peak from over $ 1,000 per ounce to less than $700 per ounce, and now we bounce back and will have a lot of volatility. Gold is relatively expensive compared to industrial commodities."

Analysis: Faber's calling card is doom and gloom, so take his comments with a grain of salt. Although trends are not entirely reliable during this financial crisis, it's interesting that he predicts a market collapse in concurrence with the drop of the gold price -- which goes against the theory of most analysts that gold will rise as the economy suffers.

"Commodities: Crude Oil Higher, Gold Slips"
Author: Chris Nichols
Website: www.TheStreet.com

Main Points: The price of gold dropped a dollar to $915.80 an ounce, while oil rose $1.77. Gold has typically had an inverse relationship to oil, the dollar, and economic confidence in general.

Analysis: For the most part, gold was flat today, and has been recently. Gold rose to $910.70 last Wednesday after falling below $900 an ounce, and has spent the past week navigating around the current figure.

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