Gold has finally achieved the price target of US$1650 set by the legendary Jim Sinclair many years ago. Based on the movements in the US stock market overnight, it appears that market players are fleeing risk and that gold has finally become a safe haven play along with silver. Unlike the last time round, the USD has not really been a safe haven play.
While many people were relieved by the debt-ceiling agreement in the US, the fact remains that nothing has been fundamentally fixed with regard to the untenable fiscal position of the US federal government. I expect a full blown crisis soon, probably within the next 2-3 years. I hope to be able to write more about this issue when I have time from my work.
Over in Europe, we have more rumblings as markets now attack Italian sovereign debt.
I think we are in for a rough ride in the markets over the short-term.
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