Experts say it's time to buy gold again

The precious metal is just coming off of a four-year low, and some observers say a prolonged rally is ahead.

By Kim Peterson Aug 16, 2013 4:42PM
Hundred dollar bills surrounded by gold © Anthony Bradshaw, PhotographerSome experts say it's the right time to buy gold again. The precious metal hit a four-year low of $1,180 an ounce in late June and has been picking up steam ever since, trading at around $1,373 an ounce on Friday.

Some of the new enthusiasm on Friday came after a note to clients from analysts at JPMorgan (JPM). The bullishness about gold was echoed in other areas of Wall Street as well. Bloomberg reports that 13 analysts think gold prices will rise next week, while four thought prices would drop and five were neutral.

Here are four reasons why JPMorgan and others say gold is now good.

1. Gold's fall is probably over. Gold fell 25% and gold equities fell 50% over the last 10 months, but stocks rose about 13%. "Gold has bottomed, of that there can be little doubt," asset manager Adrian Day told Kitco News.

2. Gold demand is strong. Consumer demand hit its highest level ever in the second quarter, CNNMoney reports. New interest was coming from consumers in the Middle East and Turkey in addition to the traditional large markets of China and India.

3. Gold could see a supply squeeze. South African mine workers have been threatening strikes against gold producers for months. The National Union of Mineworkers this week rejected the industry's offer of a 5.5% wage increase, AFP reports. If labor strikes take place, the resulting decline in supply could drive prices up.

4. Gold prices generally rise in August and September.
That's partly because there are seasonal festivals during this time in India, which is the largest single gold market.

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47Comments
Aug 16, 2013 7:02PM
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If they were "experts" they would have said to buy it at the end of June. My bet is that they are experts at dumping their crap on people after it has rallied.
Aug 17, 2013 1:25AM
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I bet those same "experts" were also recommending their clients buy gold at $1900/oz.
Aug 18, 2013 2:13PM
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Detroit is down for the count, Chicago is next, Then LA.  Pensions will evaporate for city workers in all these cities and people who depended on this income will enter the workforce out of necessity. Unemployment will go higher and Fed Stimulus will have no exit strategy.   Don't believe that millions wont lose their pensions in the near future????, you better read the news.    Ask  retired workers from big companies like United Airlines if this can happen.   You cannot print prosperity.   Prosperity comes from hard work, capital investment and savings, and producing something that someone needs.     I don't know how high Gold will go but what I do know is that I will gladly have a pocket full of gold and silver coins than a pocket full of US dollars in the very near future.   When I read some of these blogs I once again see that common sense is far from common. 
Aug 16, 2013 6:03PM
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The time to buy gold was 2004.  Get a 15 or 20 year chart and see the big picture.  This is the mother of all bull traps.

The risk vs. reward @ this price is lopsided today.  But don't let me stop you "end of the world" types from buying it.  I wouldn't hold onto too many USD's either.  Balance, diversification and wisdom.

Aug 16, 2013 8:17PM
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The heay metal I prefer to invest in in times of financial meltdown and societal collapse is LEAD.
Aug 16, 2013 6:43PM
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IF it is time for massive gold purchases again, then your money is better invested in stocking the pantry with the basic staples; flour, sugar, salt. Uncle Ben's gift of inflation and deflation is soon to be coming to a store near you.
Aug 17, 2013 9:17PM
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The reality is that gold is going up and they know whats coming real soon and I mean real soon. Watch the market go down and down in the sht....er.
Aug 18, 2013 12:53AM
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ex-Republican 

 

Take a look at the price of gold in the 1970s. It looks like the same thing is going to happen again, and it might be a bigger rise because of the fed's policies of expanding the money supply by a TRILLION plus dollars per year, with NO signs of letting up. They can't keep doing this without inflationary consequences. At least in the late 1970s the fed took away the punch bowl and let interest rates rise until they slowed inflation back to tolerable levels. This time around it's WAY TOO LATE for them to do that because the money supply is OVER four times what it was and NO signs of slowing down the growth of it. The money has got to go somewhere, and it WON'T stay in the market forever. Take a look at what happened from 1927 to 1929. Once the market starts to stumble, [and it looks like it might be happening now] the money flees walls street, and people sell as fast as they can.

Aug 18, 2013 12:59AM
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ted cruz

 

I don't know about you, but when I buy something, I take physical possession of it. Anybody buying paper gold, is gambling BIG time. And they're going to lose when the [paper gold] bubble bursts. As for physical gold and silver, there IS enough to go around, because the price will always be what people are willing to pay. If it goes TOO high people will simply stop buying because they can't afford it or are unwilling to pay the price.

Aug 18, 2013 2:48PM
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Experts are saying that NOW is the BEST time to buy gold just as the 
new car dealers are saying that NOW is the BEST time to buy a new car.
Aug 18, 2013 9:00AM
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Gold must be ready for another drop?
Aug 17, 2013 10:03PM
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gold prices are good for traders and a stable prices keeps miners in business did you ever see a country become rich without having lucrative exports ,manufacturing ,oil  ,etc....things you can use will be good now forever and in a meltdown
Aug 16, 2013 10:25PM
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And make sure you take this with a big grain of salt.
Aug 18, 2013 12:40AM
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It's called hindsight....why stop at June ....how about 30 years ago.
Aug 18, 2013 2:05PM
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By the time you finish this article, the time to buy has ended.  "Experts" are always giving advice behind the curve, never in front.
Aug 17, 2013 10:04AM
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Buy gold and watch it go lower.Hasn`t it been a great investment this year?No wonder gold

bugs are mad at the world.

Aug 16, 2013 5:37PM
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What "consumer" demand @ 1K or whatever an ounce?  The "manipulators" in the markets (big players) use this as a hedge to "shore" up their stock and bond positions.  It is "controlled"...the pundits are just letting us know again that the "game" is on.......again.  Give it a rest! Churn on!

Buy gold and you get a free bank to "store" it in.  Ludicrous! 

Aug 18, 2013 1:02PM
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Buy great stocks.It`s worked for me the last 20 years.Plus, every time I turn around I get a

nice dividend check in the mail.

Aug 18, 2013 11:34AM
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HSBC says that silver will top off at 23.00 an ounce and then go back down. I agree. Just look at the 5 year chart for stock symbol SLV. It still appears on the down trend. It is a suckers rally. Better off buying DSLV. a 3X bear silver ETF.

 

In less than 2 months, DSLV dropped over 50 %, due to silver prices going back up. When silver drops again, it will go back up. But maybe not back up to 91.00 a share. It currently is at 40.72 a share. Just look at the 3 month chart and see for yourself.

 

Short term silver may go a little higher before going back down, so do not panic and sell DSLV at a loss. Just be patient, which is hard to do for many investors. Just dollar cost average in and you should do just fine.

Aug 18, 2013 2:20PM
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I bought 10oz of gold in 2000 under 300.00 an ounce  100 ounces of sliver at 4.00 an ounce sold it all two years ago. you want see that price again. but I would not be a buyer of gold at 1000.00 an ounce or 22.00 an ounce for silver. buy crawfish.
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