The Gold Rally is Far From Over ... CNBC.com Editorial

The gold rally is far from over.
Trey Reik, senior portfolio manager at Sprott USA
Friday, 18 Mar 2016 | 9:54 AM ET
CNBC.com

The performance of gold during 2016 has caught many investors by surprise, outperforming all major asset classes.

Given the strong performance of gold and gold equities so far in 2016, it is instructive to examine factors contributing to this strength and assess their likelihood to continue in the future. With respect to the performance of gold bullion, during the past two-and-a-half years, staunch global physical demand has been carving out a durable price floor for gold in the general vicinity of $1,100 to $1,200 per ounce.

The only ingredient missing from a sustained advance in the price of gold has been weak western investment demand, in an environment of persistent strength in U.S. financial assets. In essence, when the S&P 500 index sets ever increasing highs on a monthly basis, gold's allure will diminish reflexively to consensus. However, mounting concern that U.S. financial asset prices may be a bit extended, just as breadth and liquidity are receding, has opened the door to reevaluation of gold's role as an effective portfolio-diversifying asset.

Most recently, investor concern over negative interest rates appears to have lent some urgency to western investment demand—inflows to bullion ETF's have exploded in recent weeks.

During the first 10 weeks of 2016, gold ETFs have expanded their bullion holdings by about 9 million ounces (about 19 percent year-to-date growth), or twice as much as the 4.5 million ounces shed during all of 2015. Expanding our lens to include published bullion holdings for all ETF's, mutual funds and repositories (such as COMEX and TOCOM), bullion holdings have jumped about 18 percent year-to-date.


read more here:
http://www.cnbc.com/2016/03/18/the-gold-rally-is-far-from-over-commentary.html

Read Full Article from cnbc.com

- Posted: 2016-03-20 22:41:12

More Stock Investor Place Financial News

Metals price rout is ending, says Credit Suisse Uragold Raw Quartz Assays As High As 4N Purity (99.99% SiO2) Prior To Commencement Of Testing Interview with Mr. Tony Green, CEO of UMINING Resources Inc.(UMNG) Northern Gold Intersects 5.47 g/t Au OVER 17.3 m at Jonpol Deposit Uragold Bay Resources Inc.: Corporate Update on the Development of the First New Placer Mine in Eastern North America in More Then 50 Years, "The Beauce Placer Gold Project in Quebec"

Stock Investor Place Financial News Archive

April 2016 March 2016 December 2014 August 2013 April 2013 March 2013 February 2013 January 2013 December 2012 November 2012 October 2012 April 2012 March 2012 February 2012 January 2012 December 2011 November 2011 October 2011 September 2011 August 2011 July 2011 June 2011 May 2011 April 2011 March 2011 February 2011 January 2011 December 2010 November 2010 October 2010 September 2010 August 2010 July 2010 June 2010 May 2010 March 2010 February 2010 January 2010 December 2009 November 2009 October 2009 September 2009 August 2009 July 2009 May 2009 January 2009 December 2008 November 2008 October 2008 September 2008 August 2008 July 2008 June 2008 May 2008 April 2008 March 2008 February 2008 January 2008 December 2007 November 2007 October 2007 September 2007 August 2007 July 2007 June 2007 May 2007 April 2007 March 2007