This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Gold hit a 7-week low on Dec. 22 from recent optimistic data of the U.S. economy.  For example, U.S. existing housing sales jumped more than expected, and GDP grew at a 2.2% rate in the third quarter, the fastest pace in two years, amid a larger-than-expected downward revision.  The upbeat news lifted the dollar and pushed yellow metal prices to below the $1,100 benchmark. (Fig. 1)

Bullion has gained 23% this year on a strong inverse relationship to the Dollar as the longest recession since World War II eroded the confidence in dollar and boosted gold’s status as a safe haven.

Tide’s Turning

But the tide

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Gold hit a 7-week low on Dec. 22 from recent optimistic data of the U.S. economy.  For example, U.S. existing housing sales jumped more than expected, and GDP grew at a 2.2% rate in the third quarter, the fastest pace in two years, amid a larger-than-expected downward revision.  The upbeat news lifted the dollar and pushed yellow metal prices to below the $1,100 benchmark. (Fig. 1)

Bullion has gained 23% this year on a strong inverse relationship to the Dollar as the longest recession since World War II eroded the confidence in dollar and boosted gold’s status as a safe haven.

Tide’s Turning

But the tide

Andy Mukherjee of Indian TV sits down with Marc Faber, author of the Gloom, Boom & Doom Report, discussing a wide spectrum of topics about the economy and financial markets. Do make a point of viewing these clips.

Part 1:

Part 2: Dian Chu, writer of the Economic Forecasts & Opinions blog, has kindly provided a summary of this part of the interview. Please click here.

Part 3:

Source: Indian TV via YouTube (here, here and here), December 19, 2009.

Did you enjoy this post? If so, click here to subscribe to updates to Investment Postcards from Cape Town by e-mail.

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

While certain signs have pointed to the end of the recession, unemployment remains rampant. With a double-digit unemployment rate, President Obama has been traveling throughout the nation, pushing his job-creation agenda.

Meanwhile, the House overwhelmingly approved extending the filing deadline for unemployment benefits and the COBRA health coverage subsidy through the end of February, and also narrowly passed the $154 billion jobs bill.

Billions would probably go toward highway construction and mass transit. However, the total is considerably less than the $780 billion stimulus bill passed earlier this year, and is not expected to hit the Senate until early next year. But if the legislation is ultimately passed into law, the total spending could amount to almost

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Gold fell for the first time during last week, off 4% on Friday to $1,162.40 an ounce, the biggest drop since Dec. 1, 2008 after the new U.S. jobs data showed unexpected strength. The Dollar rallied against rival currencies while traders reversed the “Sell Dollar/Buy Gold” strategy. (Fig. 1)

The Dollar’s decline has been a key factor in the record rising gold price this year by boosting the metal’s appeal as an alternative investment along with other commodities and high-yielding currencies.

Though gold briefly touched a low of $1,136.80 during the Thanksgiving week on fears of a possible debt default in Dubai, the precious metal had otherwise continued its vertical ascend into uncharted territory advancing in 21 of the past 23 sessions.

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Gold fell for the first time during last week, off 4% on Friday to $1,162.40 an ounce, the biggest drop since Dec. 1, 2008 after the new U.S. jobs data showed unexpected strength. The Dollar rallied against rival currencies while traders reversed the “Sell Dollar/Buy Gold” strategy. (Fig. 1)

The Dollar’s decline has been a key factor in the record rising gold price this year by boosting the metal’s appeal as an alternative investment along with other commodities and high-yielding currencies.

Though gold briefly touched a low of $1,136.80 during the Thanksgiving week on fears of a possible debt default in Dubai, the precious metal had otherwise continued its vertical ascend into uncharted territory advancing in 21 of the past 23 sessions.

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Gold fell for the first time during last week, off 4% on Friday to $1,162.40 an ounce, the biggest drop since Dec. 1, 2008 after the new U.S. jobs data showed unexpected strength. The Dollar rallied against rival currencies while traders reversed the “Sell Dollar/Buy Gold” strategy. (Fig. 1)

The Dollar’s decline has been a key factor in the record rising gold price this year by boosting the metal’s appeal as an alternative investment along with other commodities and high-yielding currencies.

Though gold briefly touched a low of $1,136.80 during the Thanksgiving week on fears of a possible debt default in Dubai, the precious metal had otherwise continued its vertical ascend into uncharted territory advancing in 21 of the past 23 sessions.

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Stock markets around the world cracked on Friday with the Dow Jones industrial average down more than 150 points (Fig. 1), and commodities plunging as Dubai debt woes unnerved investors, and sent tremors of uncertainty throughout all markets.

The crisis flared after Dubai, a part of the United Arab Emirates (UAE) federation, asked to delay interest payment for six months on $60 billion of debt issued by the state-run conglomerate Dubai World and its main property unit Nakheel.

Concerns that a government-backed investment company risked default ripped through world markets. Investors read it as a sign of yet another sovereign implosion after Iceland and Ireland, and recoiled from risk and piled into dollars.

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

The dollar’s value against major currencies has fallen in recent months as the US fiscal outlook worsened and amid expectations that interest rates will remain close to zero for some time to fight the economic downturn.

This week, the euro broke above the psychologically important level of $1.50 driving gold prices to record levels, prompting many global central banks intervening on currency markets to slow the dollar’s fall (Fig 1).

How did we get here?

Since the financial crisis last fall, currency markets have taken their cues mostly from stock markets. When stocks plunged in March of this year, investors rushed to the safety of US government bonds, pushing the

This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog.

Last Friday, US crude oil futures finished above $78, the highest level in a year, surging more than 9% during the past week making it the largest weekly gain since the height of the summer driving season, even though the US continues to sit on ample supply of petroleum.

Given the continued sluggishness of the economy, high unemployment rate and large amounts of excess oil production capacity around the world, analysts said a sudden upward spike was still unlikely, while others are predicting an immanent correction down below $70.

However, if you take a closer look, it is evident that the current crude oil market is almost entirely detached from fundamentals. Furthermore, there are several factors supporting oil rising to new levels, as fundamentals are