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Jon Nadler on the price of gold
Friday, November 07, 2008
I'll be on another panel with Jon Nadler of Kitco at the Hard Assets Investment Conference in San Francisco later this month - that should be fun. Here he is in a MarketWatch interview.
I'm still waiting to hear a good explanation for the inverse relationship between the trade weighted dollar and the price of gold. It's clear that it exists - the question remains why it exists and how long-lasting it might be if there is no fundamental reason for it to exist.
You can also go here to watch this.
3 comments:
Nadler didn't strike me as really taking a position he believed in in this interview -- if anything, he just seemed to be hemming and hawing a bit, with a slight negative bias to his outlook (without wanting to come outright and say he thought gold should go lower).
I have to wonder if he's not letting his book affect his prognosticating abilities.
The reason for the inverse relation between the trade weighted USD and gold is very simple. The overwhelming investing theme over the past 5 years has been a) international equities and b) commodities. You can call the combination of the two "anti-dollar." Now that those trades are unwinding, it's natural to see the dollar rise against... well, everything.
I think the next major market trend is a decoupling of commodities and non-U.S. equities. That is, I think the precious metals are about to start going up, but equities will continue to slide. Just a hunch.
That makes sense if gold is just another commodity, which is pretty much what it's been behaving like over the last six months...
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