How High Can Gold Go?

There are politicians and economists who still fault President Nixon for decoupling America from the Gold Standard and wishing that they had an advocate like President Grover Cleveland (the only President who lost the White House and regain it), but America’s abandonment of the Gold Standard is the Midas gains for those who own Gold stocks. Those Gold investors who had taken shelter as a hedge against traditional equities may not be as wealthy as the famous King Midas, but they have been getting a taste with Gold now trading over $1,200.00.

The problem with Gold being so high - notwithstanding those who got in early and prudently hedged their respective portfolios against the ebbed of the rest of the market – means that the rest of the barometers, which measure and drive economies are in dire straits. The reliable Euro has been taking a beating due to the financial woes of countries like Greece, Spain and Portugal, which are in its jurisdiction; and, moreover, the ongoing massive debt being accumulated by the United States has many financial professionals… taking refuge in reliable Gold investments.

Gold will always sell for a premium because it is finite and with the advent of governments printing money to meet social needs… and the attendant negative inflationary issues which normally follow… makes investing in Gold academic. But just how investing in traditional equities has lost its flavor for now, the question is how much higher can Gold go?  What would a correction look like in Gold – a drop of a few hundred points? Can the investors have their cake and eat it too: having stability and confidence in the Euro and “Green Back” and, at the same time, having Gold trading around, say, and $1,000.00?  Whatever the future prognosis concerning investing in the treasured mineral, the owners of Gold stocks are enjoying the ride and getting closer to the Midas lifestyle.