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Gold Prices Soar to 7-Month Highs

Tuesday, February 17th 2009

President Barack Obama signed his stimulus bill into law today, and the stock market took a nosedive. On the flip-side, the price of gold reached a 7-month high, trading at $967 per ounce for April futures. The price of gold has gone up 9.4 percent this year.

The price of gold typically goes up when there is fear in the economy, because it is seen as a safe investment. Many investors are concerned with the US Government’s ability to pull the country out of a recession, so they dump stocks and turn to gold as a hedge bet.

Some gold-pundits see gold reaching highs of $2,300 per ounce down the road.

Seasoned forecaster Dundee Wealth Inc chief economist Martin Murenbeeld and US Global Investors precious-metal-fund comanager Ralph Aldis both cite the exact same long-term $2 300/oz figure, Murenbeeld explaining that the $850/oz gold-price peak of January 2008 translates into a $2 300/oz peak in today’s money.

Sources:
AP
Mining Weekly

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