Gold, back in vogue

With gold making a strong move above $700, there is not shortage of articles about it.

Thursday, mineweb.com posted three articles after the release of GFMS’ first update of it 2007 Gold Survey. Gold could rally through $800/ounce notes GFMS’ chief analyst Paul Walker’s bullish outlook on gold. “. . . a gold price over $800/ounce was on the cards if the US sub-prime credit crisis diminished people’s confidence in the US dollar and other investment asset classes.”

Gold reasserting itself as safe haven is a longer article and discusses GFMS’ views on the gold market. Admitting that gold has performed better than earlier thought, GFMS Chairman Phillip Klapwijk now says that “there should be little problem in sustaining prices above” $700.

Also optimistic is Gold – are we at the start of a new bull market? Again calling on statistics from the GFMS update, the writer pens “The study concludes that the first half of the year saw gold experience over 200 tonnes of net disinvestment, driven by large-scale speculative offloading, but that we are now experiencing a sea change and that there will be a significant upswing in investor purchases over the rest of the year.”

Over at resourceinvestor.com, they, too, recently posted bullish articles on gold. Bullion Bull Run: Gold’s Rally Expected to Continue to 2008 summarizes their thoughts on the GFMS’ update. A lengthy article, it covers de-hedging and mine production in developing its bullion position.

Not using the GFMS’ update, Why the Bullion Market Is Surging Ahead lays out a broader view of the gold market, with comments on the liquidity crunch resulting from the subprime mess and speculation about the Fed’s next move. “Investors are betting the U.S. Federal Reserve will cut its main interest rate by up to 50 basis points, to cushion the U.S. economy against the credit squeeze.” Personally, I suspect the cut may be only a quarter of a point with a strong statement as to how the Fed is prepared to do what is necessary to provide for an order financial market, or some statement to that effect.

Meanwhile, I’m working on an article titled Why own gold, which will be emailed to our Articles of Interest subscribers in a few days. This piece will be “time less” and deal with just what the title suggests: Why own gold.