I raced into the office this morning early. I have much to catch up on. I went home early in the afternoon on Friday to fight the cold that had settled in.
I don’t put much stock in trading during holiday weeks. Too many people are away. Weakness or strength can just as easily reverse when the usual numbers of traders get back to their trading desks.
However, even if weakness doesn’t last, should gold pass through any nice round numbers, like falling below $1,200, it would prompt a headline. That cannot be helped.
Gold traders like to recall that British economist John Maynard Keynes called gold a barbarous relic back in the 1920s.
Each record high price achieved since then is considered an apt repudiation of the sentiment.
However, with gold dropping today, a more appropriate Keynes observation is that markets can stay irrational longer than he could stay solvent.
He was a speculator at times during his career. He skated along the edge of bankruptcy a time or two. He both understood and experienced markets doing something that he simply could not believe they were capable of doing.
Every speculator can be faced with this situation. The iron rule in such a market is to save themselves in order to speculate another day.
If a dash below $1,200 causes more than puzzlement, it might be time to take defensive action. On the other hand, if market positions are prudent and there is no question of maintaining solvency, then the thing to do is probably enjoy the parades, football games and dinners that Thanksgiving week offers.
More serious thoughts about gold can be postponed until next week.
Buzz blogger Dave Harper is winner of the 2013 Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper “Numismatic News.”