Price of Gold, why is it shooting up so fast?

Golden years binary options trader:
"Gold is going to keep going up"

HOUSTON: While many analysts have forecast that gold prices will eventually hit USD 3,000 an ounce, after hitting a record USD 1,800/ounce last week, economic experts at Kansas State University have warned that it is only a matter of time before the bubble bursts.

The huge federal deficit and a deteriorating economy have made many investors fearful of the US economy entering a period of stagnation, driving stock prices downward, said Lloyd Thomas, an economics professor at Kansas State University.

In this period of uncertainty, many are selling stocks and corporate bonds and putting their money into gold.

Recently, gold prices skyrocketed to as high as USD 1,800 an ounce and Thomas said the price might continue to creep higher as economic concerns grow.

"People believe that gold is a hedge against uncertain times," he said.

"In the long run, gold prices have kept pace with inflation. People are flocking to it," he added.

"But in 2000, the price of gold was USD 300 an ounce. It has gone up six-fold since then and it might go up higher than what it is right now. It's gone up too fast -- it's a bubble," he claimed.


Read the full article on The Economic Times