significant 33% improvement, page-25

barret81

The market has been brainwashed that gold is a safe haven. The GFC proved gold is not a safe haven because gold fell 30%. The financial stimulus and institutional marketing forced the gold price up to $1800. After the stimulus finished the gold price fell 25%.

There is now a view China is about to experience a financial crisis. Corporations are moving out of China due to high inflation. Prices can change every three months. China has corporate state debt 60% of GDP. When China experiences deflation they wont be able to cover debt because the low return of investment will create a shortfall.

Its a bit like investment banks operating on a margin of 3% pre GFC, a fall in revenue sent them to the wall.
China set itself up for failure in much the same way because its top heavy with under performing assets and has over capacity.

Institutions might sell gold as a safe haven but I don't know how long it will last because the USD would probably safer. In a financial meltdown everything gets sold off as it did in 2008.

The gold price probably depends on how the market will react to a financial crisis in China.
Based on the gold price now and the high inflation in China, Gold would crash in another financial crisis.
The fact that markets are anticipating another financial crisis would have seen the gold price a lot higher now if gold would rally.

I think gold could fall back to $600 to $750 usd, that was the median price between 2006 and 2008.