Hedge Funds Bailing Out of Gold?

Sell gold. Theory behind this is that the inflation is not going to hit the country or global economy without real wage growth.

This argument implies that inflation is a function of economic activity, as reflected in wage pressures and low unemployment. Unemployment is high, which is inherently deflationary, so inflation pressures will remain nonexistent. Gold, as a mere commodity rather than money, cannot rise in such an environment.

This old and tiresome argument (plus others), which coincidentally appear on F-TV before paper attacks on gold, only work if investors substitute the size of the soap for understanding. If you want to understand why gold is rising despite few signs of price inflation, it boils down to the understanding of how money is valued: Money - The Subject Theory of Value

Hedge Funds Bailing Out of Gold?:


Source: cnbc.com