Ben S. Bernanke, Chairman of the Board of Governors of the Federal Reserve, seems to have a problem deciding what the present high value of gold is indicating... The old adage says it all...Up on rumor, down of fact.
Gold went up on a weak dollar and continues to go up on a strong dollar. The main fear is the Euro zone will disintegrate because a few small counties have too much debt?
So, what if the Euro falls apart? In that unlikely scenario, all that happens is the European countries go back to their original currencies that will reflect the strength and weakness of each European country. Gold will have no role to play in the valuations of currencies and the Forex markets will get more currencies to play with.
Gold has become a pure play of hype and story telling speculation. It no longer represents a safe haven, nor is it a second currency. It has a supply/demand value as an industrial and jewelry mental and that is all its value can be calculated ...Anything else is a pure speculative play.
The next tale the speculative storytellers may be spinning could be about an old, long bearded guy in the sky, that is jealous and hates people who don't follow him. He punishes them with lighting bolts. Now, who would believe in that myth? Maybe gullible gold bugs and other condition-minded folks who cannot think for themselves?
