Since 1999, the gold price almost always increases. Over the past two years it has risen in price by 27%. Only in December 2002, an increase of 9%. But who can answer the question: what is the real price of gold, and what surprises may be expected from its motion in the near future? Analysts disagree on this.
Roaring eightieth
If you make a small excursion into history and see what world events are accompanied by a jump in gold prices over the past twenty years, you get an interesting picture. The most dramatic upsurge daily gold price at auction in London on January 21, 1980, when the price of an ounce to $ 850, was preceded by entering the Soviet Union invasion of Afghanistan in December 1979 and the refusal of the U.S. Congress to ratify the SALT-2. You should not take off and approved by the U.S. Congress act on monetary control and the deregulation of depository institutions. He expanded the powers of banks, as well as increased competition in the securities market, which brought the banks as much cash as deposits. Throughout the 1980 United States shook the wave of inflation. The situation in the gold market has stabilized until the end of January 1981 And after Iran released the American hostages during the Islamic Revolution, the gold price has dropped and averaged $ 459.71 an ounce. Strangely enough, but the "Black Monday" October 19, 1987, when the Dow Jones index fell one day at 508.32 points, has not led the U.S. into recession, the strength is comparable with the fall of 1929 Investors prefer not to seek refuge in gold, and in government bonds.
During 1988 the price of gold constantly declining due to factors such as the withdrawal of Soviet troops from Afghanistan, the fall in oil prices and the U.S. Federal Reserve raising interest rates. Large-scale operation anti-Iraqi coalition forces, "Desert Storm" began on 16 January 1991 and lasted 43 days. Transience of the fighting is not allowed is strong enough to scare investors, and the media may not have experience in filing consolidated, "a portrait of the enemy." The decrease in the value of gold in the early 90s. largely influenced by such factors as the collapse of the Soviet Union. The average price of an ounce of gold on the London Stock Exchange in 1991 amounted to $ 362.19.
"Stagnant" ninetieth
By the end of the 90s. Europe has begun to prepare for entering the single currency, central banks and European countries intensified the selling of gold reserves. In May 1999 the Bank of England announced its plans to sell more than half its gold reserves: 415 of 715 tons. This triggered panic and a collapse in prices during the summer. However, in September, the central banks of Europe have agreed to limit gold sales over the next five years to 400 tons per year. This again caused confusion in the market, as investors rushed to adjust their positions. On average in the last year of second millennium gold price has not changed, remaining at $ 278.76 per troy ounce. True, she fell in the summer to the lowest mark for the past 20 years (less than $ 250 per ounce). But in early October, the price briefly rose above $ 330. The Balkan crisis and NATO bombing of Yugoslavia, the alliance have had little impact on the price of precious metals amid fears that the IMF may be a large-scale intervention of gold on world markets. At the turn of the millennium upward movement of gold began after September 11, 2001 Two weeks after the price has risen by 7% to $ 291.40 an ounce. Immediately prior to U.S. military operations in Afghanistan, analysts on Wall Street talk about that "golden bear" has become a "gold bull." As if to confirm this, October 8, after the announcement of the beginning of military operations the Australians, thanks to its geographical position, first met the new trading day and the middle raised the price to $ troy oz 293.35. Rose and gold stocks. Then zalihoradilo other world markets. In December gold was fixed at $ 295 per ounce, as though waiting for what will be the balance of power after the appearance of such a player, as the euro. In 2002, gold prices continued to rise slowly until the end of May. Then broke the border conflict between nuclear powers - India and Pakistan. At the same time the U.S. president said that the sting operation the terrorists can not be limited to one in Afghanistan. After such a "cocktail" of news price of gold in European trading platforms has jumped to its highest level over the past 27 months. Since May 21, the spot price was $ 316.50 per troy ounce. From the beginning till the end of May the gold price has increased by 14%.
Christmas Gifts
The bellicose statements of George W. Bush and Tony Blair of Great Britain premerministra a military strike on Iraq, completely shattered the nerves of investors, and they rushed into the harbor under the name of saving the gold. The climax came on 19 December, when investors are expecting that the White House accused Iraq of violating UN resolutions on disarmament, raised the price of gold to $ 353.75 an ounce. It was the biggest price since March 1997.
The last gold in 2002 ended on a confident note, reached in morning trading in London $ 347.75 per troy ounce, leaving analysts to wonder how far it will continue to rise next year.
Without a doubt, the decline in interest rates in the U.S., the gradual shift from gold producers hedge, geopolitical instability, the fall of the indices the securities market and the weakness of the dollar provided yellow metal in 2002, almost continuous growth. Do not expect that the price for it in the near future to change their direction. However, keep in mind that 2004 will be decisive for George Bush because he has to go through a second presidential election. In Europe, the winter flood in 2003 may affect the inflationary picture of the member countries of the European Union.
The magazine "Sun" readers are already familiar with the manipulation of bank JP Morgan Chase in the gold market. Suspicions about the scams in the gold market are further confirmation. In the second half of December 2002, just before the Christmas holidays, the largest U.S. firm on retail sales of precious metals, Blanchard and Co. put forward a claim for $ 2 billion from one of the largest U.S. bank JP Morgan Chase and the Canadian mining group Barrick Gold, accusing them of manipulating gold prices.
The indictment says that American and Canadian miners bank for several years held back the growth of gold prices. They receive billions in profits on short sales, giving each other preferential treatment such that were unavailable to other market participants. Low gold prices also gave the second-largest gold miner Barrick Gold to buy up the possibility of other mining companies. Manufacturer Blanchard and Co. argues that if it were not for illegal activities of the bank and the Canadian gold miner, gold price by the end of 2002 would have increased to $ 350 per troy ounce, and at least $ 740-750.
Bank JP Morgan Chase declined to comment on the charge, and representatives of Barrick Gold shallows all the claims, stating that the company is widely practiced hedging their products and often is offering additional amounts of gold in forward contracts even before it produced. And in order to minimize the movement of prices, the company borrows gold from banks, including those at JP Morgan Chase, and then sells it on the spot market.
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