By: Adrian Ash, BullionVault
London Gold Market Report
A quick reminder of recent history…
REMEMBER Bear Stearns? You know, that quaint little investment bank which blew up 6 months before Lehmans and a full 12 months before quantitative easing began.
Here’s a reminder…
You can see the exploding bank right there…that little spike just above $1000 per ounce in the gold price…three years ago to the very day.
Here at BullionVault, we’d already had the world’s very first Thousand Dollar Gold Trade four days earlier, when gold first tip-toed up to that level. A Canadian user, seeing the wholesale-gold “spot” price nearing four digits, had offered and sold his five ounces of gold – stored securely in Zurich, Switzerland – to a Hong Kong investment fund for $1000 a pop.
Come the Monday, and as Bear was sold to J.P.Morgan for 7 cents on the Dollar, gold then hit what would prove an 18-month top. Which made our Canadian client look awfully smart, not least as everything bar the Dollar and Japanese Yen tumbled into the black hole marked “Lehmans”.
Selling what had doubled in barely two years also looked smart…and might still today. Gold’s rate of ascent since 17 March 2008 has been better than stocks, bonds and pretty much everything else (except silver). But at 36% in the last 3 years, it would seem to have slowed.
Whatever slow and steady trend gold began rising on a decade ago, however, it doesn’t seem to have hit its true peak just yet.
Formerly City correspondent for The Daily Reckoning in London and head of editorial at the UK’s leading financial advisory for private investors, Adrian Ash is the editor of Gold News and head of research at BullionVault – winner of the Queen’s Award for Enterprise Innovation, 2009 and now backed by the World Gold Council market-development and research body – where you can buy gold today vaulted in Zurich on $3 spreads and 0.8% dealing fees.
(c) BullionVault 2011
Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.