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AmulyaPanigrahi's avatar

Predictions about the rate of Gold and Silver?

Asked by AmulyaPanigrahi (5points) March 6th, 2012

Please give me your prediction on this question.

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4 Answers

Imadethisupwithnoforethought's avatar

They are due for a tremendous fall.

We are entering the boom portion of the economic cycle. The smart money is moving to equities. Eventually, inflation will start, and measures will be taken to strengthen the dollar. Whenever that happens, probably under whatever administration comes in after Obama, commodity prices in general will crash.

gorillapaws's avatar

I pretty sure their prices are going to drop by a lot. The biggest problem with commodities like gold is that they’re not actually producing anything of value, so any increase/decrease in price is purely from supply and demand. The market tanked, some people feared the dollar would collapse, this drove demand for things of universal value (i.e. gold, silver etc.) through the roof. This in turn drove prices way up. As the economy stabilizes, people will realize that the prices of precious metals are grossly out of scale and when the selloff begins, it will undoubtably be fast and furious. I would get out while the prices are still high and consider buying some diversified equities in some international markets if I were still concerned about the future value of the dollar. In my (non professional) opinion, a diverse portfolio is the best safety net.

tedd's avatar

Over time they will always trend upwards. But I wouldn’t be shocked to see them take somewhat of a fall in the short term as the economy continues to improve.

wundayatta's avatar

In terms of real dollars, I don’t believe they have proven to be a good investment. They are merely inflation hedges, and since there is no inflation, it is very odd that people are in them at all. I think they are likely to sink pretty steadily for a while now.

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