Gold Crashes Most in 30 Years … What Does It Really Mean?
April 15, 2013
Gold has fallen off a cliff. It has fallen faster than at any time in the last 30 years.
Zero Hedge notes:
Adding insult to injury, the Shanghai Gold Exchange overnight announced that following the tumbling precious metal prices and limit down drop in early trading, it may raise trading margins for its gold and silver forward contracts.
(Margin calls tend to trigger further selling.)
Some Say It Is a Good Time to Buy
While most financial advisers are screaming “sell!”, there are some well-known contrarians.
For example, Bill Gross still recommends buying gold.
Marc Faber says:
“I love the fact that gold is finally breaking down because that will offer an excellent buying opportunity” …. “The bull market in gold is not completed.”
John Hathaway of Tocqueville Funds (with $10 billion under management) says that the selloff in gold is “a contrarian’s dream scenario”:
The evidence shows strong macro fundamentals for gold, investor sentiment at a negative extreme and compelling valuations in the mining shares. It seems like a contrarian’s dream scenario to us.