Comment: Gold Flow

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Gold Flow

For quite a number of years now, gold has been flowing east into Russia and Asian countries like India and China. The Indian government has taken steps to choke off the flow of gold into the country. Chinese banks appear to be in some type of liquidity and credit crisis right now, which is causing Asians who hold the metals to sell them since the metals are the most liquid asset after the Yuan for them.

The USD is strong since there has been a mad dash to cash. All of this actually bodes very well. It is a combination of factors that will lead to a reversal of the flow of gold. The USA should now begin seeing inflows of gold rather than outflows. This low USD price means that US citizens who use dollars as their primary currency are also in a position to benefit and accumulate the metals.