Gold --- Update II

Not many exciting news going on. Thought of just follow through on my gold story. I've been watching a number of guys that bullish about gold ---- when pressed by the talking heads, their responses usually errrr...arrr.. may by 2010 or 2012 we will see gold to move beyond US $ 1,000. Marc Faber recently says gold is relatively more expensive than industrial metals.





I investigated COT report further, found open interest dropped by half compared to beginning of 2008. Large speculators are still quite bullish(80%+) but large commercial buyers have turn very bearish (26%+).


(Click image to enlarge)

Investment is account for about 1/5 of the demand while jewellery and industrial account for almost 3/4. With the weaker economy outlook, there is no surprising to me the large commercial traders are shorting gold.



http://www.invest.gold.org/sites/en/why_gold/demand_and_supply/

I'm still betting against inflation because there is no free lunch - printing money by central bankers around the world - and walk free. The big but: chances of it showing up in 2009 is quite slim unless we believe economy is going to recover strongly in 2009. I guess you cann't have your cake and eat it at the same time. I will defer the timing of my purchase to avoid money being tied up for a while. With that, I rest my case.