Taken From: http://www.altlondon.org/article.php?story=20091103162731209&mode=print
Main Article: http://www.theglobeandmail.com/globe-investor/gold-sets-record-amid-currency-wars/article1790167/
Amid a world of currency wars and financial crises, investors are moving away from fiat currency and into commodities, particularly gold. Investors believe that this is a safe haven compared to currencies such as the U.S dollar, the Yuan, or even the Euro, as the well being of certain key players in each economy is uncertain.
The main question to be asked is how high the price of gold will go. The current market price of over $1400/oz is already highly inflated, and if the currency war comes to an end, investors in this “safe haven” may lose a lot of money. Other investors may move away from gold and back into currencies such as the U.S greenback, and the Euro.
Could gold be the next currency? I do not believe so, the commodity is too volatile, and it loses in some cases dozens of points or gains dozens of points each and every day.
However, in spite of this move, investors are not taking all their money out of stocks and into gold, which could mean that gold is not the ultimate haven. Investors should see how the currency war plays out before investing a lot of money into the commodity.
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