Barrick (NYSE:ABX), Newmont (NYSE:NEM), Goldcrop (NYSE:GG) all dropped with the broader gold sector, as gold prices plummeted on the comments from Treasury Secretary Tim Geithner that "No country around the world can devalue its way to prosperity."
Of course that's what has been happening for decades (devaluing dollar) and will continue to happen, but it was the right thing to say in order to give some breathing room to the U.S. dollar and slow down the rise of gold prices so it doesn't expose the folly of Federal Reserve policies and the refusal of the government to rein them in.
Gold was ready for a correction after its recent breathtaking climb, and speculators were waiting for something to give them a reason to take profits, which they did.
Gold miners had made moving up with the price of gold as well, so a correction was timely for them too.
Barrick closed at $45.46, losing $2.36, or 4.94 percent. Goldcorp ended the session at $42.00, dropping $2.00, or 4.55 percent. Newmont stood at $59.93 at the end of the day, shedding $2.56, or 4.10 percent.
Volume was significantly above the daily three-month average.
Don`t panic!
ReplyDeleteReality will force the price of gold up.
Just imagine what will happen when China starts switching from dollars to gold.
It will not happen in bright daylight but insidiously at night.One morning we will wake up to the reality,that we are POOR and
all the suckers will rush to the golden door finding it locked.
Steen Baaring