It maybe the dog days of August for most of us, which is what inspires somewhat silly headlines like this, but apparently it is not dog days for gold.
The precious metal has been frisky since the first day of the American Numismatic Association World’s Fair of Money back on Aug. 11.
It was a wonderful underpinning to show results and perhaps was the single most important factor in making gold coins of the $1 to $5 a very active focus of the collectors and dealers who were buying on the floor.
Really, though, the price is only up about $65. Are we getting a little too enthusiastic a little too quickly?
We have had false starts before.
The present price of gold is a long way from the peak of nearly $1,900.
But every journey starts with the first step.
Was that first step made in recent days? I don’t know.
I feel a bit like Charlie Brown who keeps trying to kick the football held by Lucy, who then takes it away, landing Charlie Brown flat on his back.
When you are flat on your back, the only way to look is up.
I know gold has been in general decline four almost four years to the day.
I know the prior gold bear market lasted for 21 years.
What is different this time?
I know the fiat money arguments.
The U.S. dollar was fiat for the entire 21-year prior run of the gold bear market.
The dollar is presently strong.
Back in the 1980-1985 period the dollar also went on an upward arc just as it is currently doing. The British pound, which is currently $1.56, was down to $1.05.
And the pound was just one of many currencies to decline in that dollar ascendancy.
But then the dollar got weaker. Gold fluctuated a bit higher as it is currently doing, but it did not ever break the downtrend.
This final break occurred in September of 2001. The downtrend ended.
But the world changed enormously in September 2001.
No American will ever forget Sept. 11.
What will truly turn gold around today?
Buzz blogger Dave Harper has twice won the Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper "Numismatic News."
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