the demand for hedge funds will always be there...the demand from jewellers hardly impacts upon gold price!
its all about supply/demand
the supply/demand need not necessarily be physical(same applies to all the commodities- if they traded on plain physical supply/demand then the prices would be a lot lower)! Its just a safe haven and has a lot of great characteristics. Gold is on a long term uptrend, it was too low for far too long. Now its getting right the price it deserves!
Of course the gold producers benefit the most, which is ironic coz thats the physical suppliers.
-A new Gold bull
Fed.
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