Gold's immutable legacy as an enduring store of value is firmly rooted in both cultural traditions: East and West. However, whereas the Western world shifted to an unmistakably negative prevailing attitude toward gold during the 20th century -- devolving ultimately into widespread prejudice against advocates of investment exposure to gold -- China is described by the WGC as sharing a "similar gold culture and heritage" with India. Thus, it may come as no surprise that we are witnessing a much faster cultural reprioritization of gold as a broadly popular investment asset in China than we have observed in the West to date. Indeed, for all the widespread bull-market hoopla surrounding gold, total consumer demand for gold (jewelry and investment demand combined) in the United States actually fell by 3% over the trailing 12 months through March 31, 2011; while in China that demand grew by 37% over the prior-year period.Because of that rising demand in the East, Barker forecasts gold will reach $2,000.
Wednesday, May 25, 2011
Key To Next Leg Of Gold Bull In The East
Christopher Barker, of the Motley Fool, says that continued Asian (particularly mainland Chinese) demand is the key for gold going up to $2,000. Demand from that country and India alone make up 57% of total demand, according to the World Gold Council. Both peoples have a traditional attachment to gold, as well as rising incomes and inflation problems. These three factors in tandem have fueled an explosive growth in gold ownership, particularly in mainland China.