Thursday , 25 July 2024

I’m As Bullish As Ever On Gold Bullion – Here’s Why

The recent panic selling in gold bullion caused those who were speculating to get outgold-silver as their losses added up…[but] retail investors and central banks seem to be rushing to buy more. [Why is that? Let me explain.] Words: 260; Charts: 1

So writes Michael Lombardi ( in edited excerpts from his original article* entitled American Real Disposable Income Collapses in First Quarter of 2013.

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Lombardi goes on to say in further edited excerpts:

I still believe that the fundamentals that drove gold bullion prices [up] are still in place. Central banks are still buying gold—they have not shied away from gold bullion as prices declined from their 2011 highs.

While world central banks keep buying gold, many central  banks, like the Bank of Japan, are printing massive amounts of paper money. In  its semi-annual report, Japan’s central bank stated that it will continue to  print at a pace of about $600–$700 billion per year. (Source: Financial Times, April 26, 2013.)

Likewise, the Federal Reserve still hasn’t given any  indication it plans to stop printing fiat money anytime soon. Ultimately, this  phenomenon will force other countries to print more of their currencies because  every country wants a lower-valued currency than the next country. Because of  this, I believe central banks will buy more gold bullion to shore up their  reserves.

Dear reader, the bull market in gold bullion isn’t over yet!  The selling we saw was just a mere pullback.

Take a look at the monthly chart  below of gold bullion prices going back 10 years.

chart1 Chart  courtesy of

Since 2002, the trend in gold bullion prices has been to the  upside, and from a technical analysis point of view, that trend seems to be  intact.

I am as bullish as ever on gold bullion.

Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.


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