Bail in risk - €4 Trillion Italian banking system at risk as referendum looms Sunday according to Financial Times. Italian banking system looks vulnerable to collapse whether the referendum is passed in Italy or not.
Gold tends to rise when interest rates rise as was seen in the 1970s and again from June 2003 to June 2007 (see table) when interest rates rose from 1% to 5.25% and gold rose from $346 to $651 per ounce.
Gold mine production is peaking globally and this is “bullish for gold” according to a slowly emerging group in the gold industry. It is great to see the reality of peak gold production slowly be acknowledged in the mainstream as it is an important fundamental factor in the market which has been continuously ignored.
The recent sharp gold price fall is again causing jitters among some investors, who forget that gold remains more than 14% higher in dollar terms, 16.5% higher in euro terms and 36% higher in sterling terms year to date. Thus, outperforming most stock market indices so far this year.