February 19, 2009

Banking on gold when banks fail

A fear of stocks and currency is pushing an interest in buying gold, long thought to be a fail-safe investment, U.S. gold merchants said.

Gold is almost an insurance policy, Arthur Blumenthal at Stack's, a New York dealer, told USA Today. It will always be there, and always pay.

January was the best month we've ever had, and February is shaping up to be the same, said David Breahm, vice president of research at Blanchard & Co., a bullion dealership in New Orleans.

We sold more gold in January than in all of 2007, he said to the newspaper.

The price of gold has soared from $713 an ounce in October to near $980 an ounce but not everyone believes the prices will hold up.

We think gold will tumble, said Peter Kendall, co-editor of the Elliot Wave Financial Forecast. Gold will be a deal when it falls to $600 an ounce, Kendall told USA Today.