Ben S. Bernanke, the world’s most- powerful central banker, says he doesn’t understand gold prices. If his peers had paid attention, they might have stopped expanding reserves that lost $545 billion in value since bullion peaked in 2011.
I find it ironic Mr. Bernanke delivered his speech at my alma mater. He is simply re-hashing the same specious rubbish that I learned over forty years ago as I worked toward my degree in international economics.
Gold prices fell towards the $1,645 level at the opening of the midweek session in New York as the US dollar climbed slightly on the trade-weighted index. The initial action was rather subdued but speculators were perhaps justifiably skittish.
Still stubbornly high oil prices are bullish for gold but have not led to higher gold prices so far. Risk appetite remains high as seen in equity indices near record highs and gold more than 15% below its recent nominal record high.
Precious metals trading opened on a slightly weaker note this morning as minor gains in the US dollar and a small decline in crude oil and copper dampened buying enthusiasm somewhat more. The spot gold price fell to near the $1,455.00 level.