What colour is one Australian dollar ? What colour is one Euro ? What colour is one US dollar ? PAPER.
I think you get the drift. Gold has never left the monetary system, and never will. hint hint
It is gaining value based on the fact the US has monopilozed the forex market in favour of debt and as the trade deficit suggests, the debt levels (USD) is unsustainable. Put it this way, if everyone holding USD was to go the government to redeem their gold and there is more dollars than gold, what would the excess money be ? Nothing more than a worthless peice of paper!
It's basically a debt v gold war, many nations were forced to hold their currency reserves in USD and not gold when the Gold Standard was abolished in 1971, as the US government were printing more and more money, not indifferent to a company issuing more and more shares.
But as the USD sinks and nations sell their gold reserves which which has been a part of the currency reserves since the beginning in time. The whole scenario can get extremely ugly, as other nations where the US has monopolized their currency reserves also becomes worthless as the USD falters and falls.
Another point, Central banks were/are lending gold at ridiculous prices to supress the price of gold in favour of debt circa 1971, which has put the central banks in net defecit as the price of gold rises.
The market cap of the global gold market combined is possibly the smallest market in the world, it has shrunk significantly over the past 30 years. So what I am saying is that it won't take much buying for the gold market to resume its natural equilibrium in relation to market cap and value.
