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A P R I L / M A Y 2 0 2 0
Is gold undervalued? That question came
up on multiple occasions in my 30+ years in
the brokerage business. As I write this piece,
the precious metal's price has just run-up
to a new seven-year high of US $1,717/oz.
Is the current price undervalued? It could
be except that less than a year ago the price
of gold was hovering around US $1,350/oz.
Was US $1,350 undervalued?
Looking back with the added benefit of
hindsight, gold was undervalued at that
time. Now, with this added dimension in
mind, is US $1,717 still undervalued? Or
could it be fairly valued or even overval
-
ued? The value of gold may be based on
one's
time horizons or market parameters.
Let's look a little deeper into this short but
very dynamic question.
Most commodities, including gold (and
yes, gold bugs – gold is a commodity as
well as a currency), are volatile in their
pricing due to their underlying cyclicality.
That is, the price of a commodity will gen
-
erally rise or fall based on the current or
perceived future demand. Some cycles are
short or seasonal while others are longer,
even generational.
GOLD – a welcome
safe haven
by Rod Blake
GOLD
GOLD IS FULFILLING ITS 5,000-YEAR SAFE-HAVEN STATUS IN THESE DIFFICULT TIMES WITH
LARGE PHYSICAL METAL SALES. AS THE MAIN DRIVER OF GOLD STOCK PRICES, WHAT IS GOLD'S
REAL VALUE?
