Gold? It Is Deja-Vu All Over Again
Look carefully at the 35 year chart at the bottom of this page:
Notice the peak at 1980. The president was “Jimmy” Carter. Gold was just above $900 an oz, and sure to go to $2000 because:
1) the US economy was in the tank
2) the U$ was going down
3) oil exports were high + Arab oil embargo
4) the “asian tigers” were flexing their industrial muscle
Sound eerily familiar?
This what happened next:
**the economy improved
**the dollar recovered, modestly
**people realized that 1920s-Germany-hyperinflation was not going to happen
**gold tanked to $300-400, and stayed there for more than a decade
Will history repeat itself? No one knows for sure. I do know, from watching the price of gold for decades, that:
**gold bugs are always saying that $2000 gold is just around the corner
**spot gold responds not to long-term trends, but daily, to human emotion (cue Mr. Spock’s eyebrow).