Chapter 52 Five, the characteristics of gold price

According to the latest statistics released by the World Gold Council, in the third quarter of 2008, the global demand for gold hit the highest quarterly demand record ever.This record represents a substantial increase of 45% from the second quarter of 2008.The world's largest gold ETF fund SPDR increased its position by more than 130 tons in just one month.The European Central Bank and European member states also collectively increased their gold holdings. In the past two years, there have also been major underground gold trading cases in China, involving tens of billions of dollars. Likewise, rumors that gold can rise to $6,000 an ounce spread like wildfire.So, what to make of this new wave of gold?

Finally, I would like to talk about the characteristics of the manipulated gold price, which I find very interesting.When gold is manipulated, it behaves much like oil prices.Do you still remember what I told you earlier, why did the oil price go from more than $70 a barrel to $147 a barrel and then fell back to $35 a barrel?why?It is to calculate China and Russia. This is manipulation with international political purposes!As a result, you found that under the manipulation of international financial speculators, the gold price trend is exactly the same as the oil price trend, which is very surprising.

Since the price of oil is manipulated, why is the price of gold not manipulated?What good is manipulation?Looking at the trend of the US dollar and gold, please pay attention to the fact that gold and the US dollar are all negatively correlated. When the US dollar reaches a peak, gold will go to a trough. When gold is at a peak, the US dollar will go to a trough. , gold depreciates, this is very important.In the end you will find that the price of gold itself is manipulated along with the price of oil being manipulated.It moves in the same way as oil prices, so there can be a hedge between it and the dollar.This is what I said before, if you are going to buy gold today, I advise you to buy $100 of gold and buy $100.What is the purpose of this?The result of adding them together and dividing them by two is that their price movements are a straight line, and a straight line means no loss.If you want to buy gold, you don’t want to make money from gold, because it is a heavily manipulated variety, and you are likely to lose money, because I don’t know how to manipulate it in the future, and the level is not enough.But if you want to buy gold, you can buy $100 worth of gold, and then buy another $100, because gold can be completely hedged against the U.S. dollar.So what's so good about this investment strategy?That is to say, you can only make money in the era of bubbles. Once the bubble bursts, you basically lose what you invest.Therefore, the best financial management expert is not to lose money, so you only need to buy the equivalent of gold and US dollars, and you will make the best investment, and you are guaranteed not to lose money.

In addition, what about the value of gold after removing the inflation factor?Except for this stage in the 1980s, the price of gold was basically at a level on the whole. What does this mean?That is to say, if you buy gold, you can not only hedge against the US dollar, but also fight against inflation in the long run. Therefore, I make a conclusion in this chapter. The result of our insufficient attention to gold, including myself, is that gold is particularly easy to be manipulated.So starting from the decoupling of the U.S. dollar from gold in 1968, the price of gold was pulled down to $800 an ounce. At this time, the view of "gold is useless" was sung again, and the price fell to $250 an ounce.Finally, hedge funds in the United States began to buy gold in a big way, pulling up its price again.So the gold price is heavily manipulated.

But I found that the trend of this manipulation is similar to that of oil prices.Since they are all manipulated, I dare not tell you how the gold price will go in the future, so you should not guess whether the gold price will fall or rise.What good is it if you're going to buy gold?Two benefits.First, it can be hedged against the US dollar.It can guarantee that you will not lose money or make money. It is the best to be able to guarantee that you will not lose money during a depression. Gold can not only hedge against the US dollar, but also has another advantage. At least according to past data, the price of gold after inflation is removed can effectively resist inflation.So in the end, buying gold can achieve a certain degree of hedging. Not only can you just hedge against the U.S. dollar, so that you don’t lose money or make money, but you may also be able to hedge against inflation. This is the purpose of buying gold.

In the spring of 1976, The New Yorker published a famous cover image titled "The World as Seen from Ninth Avenue" by Saul Sternberg, which has become a symbol of a narrow worldview sexual portrait.Do you remember what it looked like?Downtown Manhattan looms impressively in the foreground; in the middle ground, the rest of the United States occupies a green rectangle; and three low-lying bubbles loom on the distant horizon, marking China, Russia and Japan.India didn't even occupy a point. That cover could never have been released in this day and age when China and Russia and India and Mexico and Brazil and Turkey and the Czech Republic and all the other fast-growing economies are coming in from all directions and every minute Integrate into our daily life.We all know the global sourcing of products and services—our shirts are sewn in Romania; our apricots are picked in Turkey; the computer hotline is staffed from India; and laptops are assembled in China.But the shirt tags and Indian accents are just the tiny tip of a vast iceberg emerging from the sea, the bulk of which is the presence of the Challenger in our everyday lives.

Global affects anyone, anywhere, and everything.That means you are no exception.One day, Tata Group may buy your business, your children may call home from Shanghai, your job may move to Mexico City, and a flash car will be parked in your driveway. A bright new Changfeng car.It's just a matter of time. A polycentric world order may require a new fundamental philosophical perspective.For many years, especially during the Cold War, we have been accustomed to binary views - East vs. West, me vs. you, the best vs. the rest... We need to get out of this thinking.We found that successful countries are opening up to the world, and China is a well-deserved model country.We’re also seeing successful businesses pushing boundaries and being as flexible as they can — collaborating with anyone, whenever it makes sense.In addition, we agree with the point of view: "There is no single truth that is universally applicable." For enterprises, if they can make full use of their unique resources, use their own methods to continuously innovate, constantly adjust, and surpass all traditions boundaries, they are bound to succeed.

(This article is excerpted from "Global" co-authored by three partners of Boston Consulting Group)