T & K Futures and Options Predicts Multi-Decade Highs in Gold Futures Prices

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The weakening US Dollar, inflation, ETF's, lack of gold production expansion and increasing investment demand may push gold futures prices to multi-decade highs in 2008.

The weakening US Dollar, inflation, ETF's, lack of gold production expansion and increasing investment demand may push gold futures prices to multi-decade highs in 2008.

The US Federal Reserve Bank has been lowering interest rates and adding liquidity to the banking sector in order to help alleviate the problems in the financial services sector cause by the sub-prime crisis. Lowering interest rates have weakened the US Dollar because foreign investors can get higher rates in other countries. The printing of record amounts of US Dollars has caused an inflation problem. Gold futures prices have historically had an inverse relationship with the US Dollar. A weakening US Dollar often leads to higher gold futures prices because gold has traditionally been an inflationary hedge for savvy investors. Visit http://www.tkfutures.com/gold.htm to learn more.

The recent popularity of Gold ETF's has helped to push gold futures prices to their current levels. The ETF's now have gold holdings as large as the world's central banks. This consumption of much of the available supply may help to push gold futures prices to record levels in 2008.

Gold production costs have gotten more expensive and new mines have been harder to come by recently. This lack of new gold supplies hitting the market over the near term may contribute to sustainable high gold futures prices over the next 18 months. Visit http://www.tkfutures.com/education.htm to learn more about gold futures.

The author of this article is a 14 year veteran of the gold futures markets and the president of T & K Futures and Options Inc. Before considering gold futures or options as an investment vehicle, one must understand that there is significant risk of loss in gold futures and gold options trading. Use only risk capital for high risk investments like gold futures and options. Past performance is not indicative of future results.

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MICHAEL SMITH
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