GOLD OUTLOOK 'Clear upside potential for gold' Writing in Rand Refinery's latest annual, report former DRDGold chairperson Mark Wellesley-Wood says that the growth in private gold ownership through exchange-traded funds (ETFs) has been “the greatest privatiSation” in history. He points out that the stability of ETF holdings in the face of gold-price volatility this year has been even more remarkable.
This shows a substantially different type of investor from the short-term traders who used to dominate this market. With seven ETFs now traded on nine exchanges it appears as that there is a new long-term holder appearing in the market.
Wellesley-Wood is of the view that gold stone crusher equipment samba chinais moving from the vaults of the supposed guardians of the national interest and into the portfolios of those who seek to preserve their wealth independently.
“The conflicting pressures of retaining national interests in the last empire – the US will be too much for the dollar if the costs of maintaining both welfare and global security objectives are going to be sustained. The fallcrushing equipment flow charts of the US empire may be the last link in this chain,” he adds.
Wellesley-Wood says that power is shifting to the east, but this is a different type of power. China has given up on war as the way to win the battle for world power. It is economic supremacy that will tell.
Historically, gold moves and accumulates in the direction of economic power. Gold is now flowing into Asia as it lzenith vertical crusher usaeaves the US and Europe.
“Gold is pivotally playing its historical role as it has since time immemorial. Gold's status as the finite global currency is becoming increasingly relevant as nation states lose their hegemony over our savings and freedoms,” he states.
Gold Fields Mineral Services (GFMS) believes that there is clear upside potential for gold, even though a brief dip below tused concrete crushing machineshe $600 barrier can never be entirely ruled out.
The company reiterates that there is clear scope for jewellery demand to pick up especially if prices show greater stability or if any small dip in the price occurs.
Evidence for this views lies in jewellery's performance last year. There may have been a 29% slump in jewellery offtake in the first half year-on-year, but this shows its sensitivity to price rather than real weakness, as soon as prices calmed and eased sufficiently to be seen as stable and fair, offtake quickly recovered. The world's largest gold jewellery market, India's jewellery fabrication in the first half of 2006 fell a dramatic 48% year-on-year, yet the second half saw an almost as substantial rebound of 43%.
Another factor that should inject some strength into the jewellery industry is a refilling of the supply pipeline in many Western countries. Many retailers and wholesalers in Europe and North America saw substantial destocking during April/May 2006 price spike as they either chose not to replace sold inventory, hoping for the imminent arrival of a cheaper buying opportunity, or were prevented from making fresh purchases due to credit lines being breached by higher prices.
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