Another gold rush

Do you remember Charlie Chaplin movie “The Gold Rush”? It was a movie inspired by the reality. I think we are at the beginning of a new gold rush. We have enough reasons to believe that. Gold resources can not be inexhaustible, and production will be decreasing. 

Extracting and processing costs are increasingly higher. 

The same, demand is growing, because gold is the most ductile of all metals and is used in the top microtechnology, with applications from household to military and spatial missions.Gere is demand graphic for gold.

And here is supply graphic for gold, with almost the third part coming from recycling

So, resources decrease, production costs increase, demand grows. How will the price react? Obviously it will grow. Maybe not tomorrow, maybe not next week, but surely the long-term trend will be bullish. In my opinion $1400/oz knocks at the door. Let’s see who will open the door. Syria? Korea? Or maybe another bubble crash? The future will tell us, but it’s sure, gold is very bullish in the future.



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