The price of gold is at an all-time high: what does it mean?
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TEXT OF INTERVIEW
JEREMY HOBSON: Gold hit an all-time high today of $1412.75 an ounce. Investors are looking for a safe place for their money. And analysts say the price of gold could go even higher.
Marketplace’s Alisa Roth is covering this story for us this morning, and she joins me live with more. Good morning.
ALISA ROTH: Good morning.
HOBSON: The last time gold rallied like this was back in June, when everybody was afraid Greece might go bankrupt. Why is everybody buying gold again?
ROTH: It’s really the same kind of flight to safety. Investors are nervous, and as you said, they’re looking for someplace safe to put their money. And they have been for awhile. The price of gold today is essentially one and a half times what it was back in September 2008 when the Lehman Brothers collapsed. I talked to Justin Urquhart-Stewart this morning. He’s an investment manager in London.
JUSTIN URQUHART-STEWART: In the shorter term it’s actually provided more comfort for people. In many ways, I almost see gold as a bit like being a financial teddy bear. You can cuddle it, you can hold it, you can put it on your pillow next to you.
People are worried about the global economy. They’re worried about countries like Ireland and Greece, again, which they think may not be able to raise the money they need, maybe the effects of the Fed’s move last week. They’re worried that both the dollar and the Euro are losing value.
HOBSON: What’s the correlation there?
ROTH: Well, for the most part, when the dollar falls, the price of gold goes up. People who otherwise might put their money into dollars want something more secure. So they turn to gold. It’s also worth mentioning that people are putting their money in other precious metals too, so platinum and palladium prices are both up. And silver is going for $28 an ounce. Which is the highest its gone for in something like 30 years.
HOBSON: Marketplace’s Alisa Roth, thanks.
ROTH: You’re welcome.
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