GOLD AT RECORD HIGH

My SIMPLE SOLUTIONS for Humanity featured gold in Chapter 5 on Religion, as serialized in my daily blog of 23December2009.  Plus I report on the price every weekday because a pronounced increase omens badly for the economy, as people are putting money into something "safe."  You might have noted that this precious metal hit a record high of $1276.50 / troy ounce yesterday.  Is this significant?  Yes, but in 1980, gold reached $850/toz, which today would be worth $2,210/toz.  This was that period just after the Second Energy Crisis.  Thus, there is long way to go before hitting the real maximum.  

The price of gold ten years ago was $271/toz, when the S&P 500 was around 1500.  Today, the S&P has dropped down to 1125, a 25% decline, while gold has surged up 470%.  Maybe no double dip, according to Warren Buffett, but, certainly, ominous times appear to be ahead for our economy, if gold prices are indicators.

From Bloomberg Businessweek:

1.  The price of gold has risen for nine straight years.

2.  The USA has more than twice the amount of gold as Germany, the #2 country, and almost eight times more than China.

3.  All the melted gold would fit into 3.42 Olympic-size swimming pools.

4.  Slightly more than half the gold is used for jewelry.

5.  Major gold deposits:

#1  Murantau, Uzbekistan (50 million ounces)

#2  Natalka, Russia (40 mo)

#3  Grasberg, Indonesia (36 mo)

#4  Donlin Creek, Alaska (34 mo)

#5  Sukhoi Log, Russia (33 mo)

#6  KSM, British Columbia (30 mo)

#7  South Deep, South Africa (29 mo)

You read virtually everyday companies selling Gold Eagle coins.  A 2009 $5 government issued version weighs one tenth of a troy ounce.  This should then have a worth of $127 today.  You can mail order it for $138, plus shipping and handling.  Watch out for those costs.  Plus, in general, remember that a troy ounce weighs 10% (really, 9.7%) more than a regular avoirdupois ounce, and everyone confuses one with the other. But the difference is $127/ ounce.

What about those companies that fly in for a day or two to buy your jewelry or scrap gold?  Internet scams are rampant.  In general, watch out!  But if you must, there are reliable dealers.  Here is how to be careful.  Also click on cockeyed.com.

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The Dow Jones Industrials went up 46 to 10,573, world markets were mixed, but the Japan Nikkei zomed 217 to 9517.  Nothing like some government stability.  Gold dropped $2/toz to $1267 and crude oil is at $75.70/barrel.

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Hurricane Igor (135 MPH), Hurricane Julia (135 MPH) and Tropical Storm Karl (55 MPH) are moving according to all predictions (see their tracks in the blog yesterday), while the disturbance in the Eastern Pacific is now Tropical Storm Fanapi (meaning small atoll islands in Micronesian) at 45 MPH, soon to strengthen into a typhoon, and headed either for a rendezvous with Taiwan, Okinawa or China this weekend.  All three will get a lot of rain, and more.

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