Holy Shit!

Gold tops $900 US an ounce as U.S. recession fears grow
Last Updated: Friday, January 11, 2008 | 5:04 PM ET
CBC News
Gold prices topped $900 US an ounce for the first time ever on Friday as investors flocked to what is increasingly seen as a safe haven for their money.

Gold futures for February delivery rose to $900.10 US an ounce in morning trading on the New York Mercantile Exchange, up $6.50 US from Thursday's close. The contract eventually settled at $897.20 US, up $3.60 US.

Gold broke through the $850 US level only last week. It rose by more than 30 per cent last year and has tripled in the last six years.

"Gold has reached a new high on the back of several factors all combining to create a very positive environment for the precious metal," ScotiaMocatta analyst Camilla Sutton told CBCNews.ca. "The combination of weakening U.S. economic fundamentals, inflation fears and high oil prices combined with de-hedging of some corporate gold books and strong [exchange-traded fund] demand has all helped gold reach an all-time nominal high."

Sutton said a pullback is likely but that the medium-term
outlook for gold is still positive. "The next major psychological level is certainly $1,000 US gold, and ScotiaMocatta believes we will see this in 2008," she said.

The TSX gold sub-index rose two per cent to a new 52-week high on Friday. Barrick Gold, Goldcorp, and Kinross Gold all hit new 52-week highs.

Investors are increasingly worried about a U.S. recession. Two major U.S. investment banks came out this week with predictions that the U.S. economy will either head into a recession this year or is already in one.

Last week's U.S. jobless report — which came in much weaker than analysts were expecting — also rattled markets and heightened recession fears.

Federal Reserve chairman Ben Bernanke's comments Thursday that the Fed remains ready to make further "substantive" interest-rate cuts if needed served to further drive down the already weak U.S.dollar and drive up gold prices.

More market watchers now predict that the Fed will slash its key lending rate by half a percentage point on Jan. 30.

On Thursday, American Express added to the caution, with news that more of its customers are behind in their credit card payments. It set aside $440 million US to account for overdue loans. Capital One said much the same thing on Wednesday.

This really worries me. The fat cats know exactly what the rest of us fear, unfortunately they have the financial wherewithal to move their vehicles into the gold safe haven. Crap - I worry that this is going to be the terrible economic downturn your grandmother warned you about that's going to wipe out everything I have. Oh well, I guess myself along with the other 99.5% of the population that can't afford to buy gold at $900 an ounce, or any of the other precious metals, for that matter. They're all priced ridiculously high right now. Man, ominous signs everywhere, getting worse by the day.....