The markets section of the WSJ is currently running a piece titled the World is Bitten by the Gold Bug.
“Gold continued its upward march in a time of global financial tumult, closing above $1,500 an ounce Thursday for the first time as investors seek safe haven in the metal.
In a remarkable performance for any sort of asset, gold has notched a record high every day this week—on days when investors were alternately gloomy and optimistic. On Monday, as stocks swooned after Standard & Poor’s warned about the credit rating of the U.S., gold reached a new high. It kept rising on Tuesday and again on Wednesday, as stocks soared on impressive corporate earnings.
On Thursday, gold rose $4.90 an ounce to $1,503.20, another nominal record high and its first settlement above $1,500. Gold is up for five straight weeks, and has gained 5.8% so far this year.”
The two charts below give a good perspective on this weeks action –
Now for the bad news, if you were local investor and bought gold on someones advice or because you gotten bitten by the gold bug. You have done something fairly stupid because the exploding AUD has wiped out any gains you may have made.
The chart below is gold measured in AUD.
As you can see it is hardly a stellar performer.