Gold set a new record price yesterday of $1,402.80 a troy ounce.
It is time to pause and absorb it properly. I paused a whole lot longer than usual simply to get my mind around the new fact.
The daily price increase was only $5.50, but oh what a $5.50 that seems to be.
Round numbers always attract headlines because the mind treats them as something significant, milestones in other words.
Goods are priced at $1,399 because it sounds cheaper than $1,400. I would feel much better buying a large screen TV for $1,399 than $1,400.
The same mental phenomenon is true for the price of gold. There is less mileage to a headline that says gold reaches $1,399. My readers would be much less impressed with it than one that says it reaches $1,400.
It feels so much better to reflect that any gold I happen to own is worth $1,400 an ounce rather than $1,399. This happens even though there is no material difference between the two numbers unless you are trading far larger quantities than an average person can afford.
When gold reaches each new milestone level a new page seems to be started in the brain.
It is hypnotic in a way. It is hard to break away from it to get on with the rest of my day.
How does it affect you?