Jeff Reeves: Necklaces Won’t Counter GLD Selling Pressure
The spot price of gold moved downward across nearly all of 2013. And while I don’t expect another 25%-to-30% decline for gold prices, it’s reasonable to expect downward pressure to continue and for gold to finish the year down slightly from where it is right now.
Gold prices per ounce are being affected big-time by the investor exodus from the precious metal, thanks to redemptions from asset-backed funds like the SPDR Gold Shares (GLD). As investors look to a red-hot stock market instead, the lack of demand is simply gutting the spot price of gold.
You’ll hear a lot about foreign central bank demand or nations like India and China gobbling up gold. But the GLD fund alone lost about $24 billion in assets across 2013 — and that kind of selling pressure can’t be offset simply by more emerging market consumers buying jewelry.