What's totally weird is that no one has a decent explanation.
Those 5 "reasons" are as good as none. Since I learned economy in the end of the 90, it's the most intriguing economical event I came across.
Internet firm bubble and collapse was normal. Sub-prime crisis was pretty logical. Bitcoin was an old trick.
But lost faith in gold is pretty amazing in it's implication, and it's without any precedents. The interesting question : Where will go all the liquidities, those billionaire just took off the gold market? Edit: It seems it's basically market manipulation.
But manipulation on gold is so hard to pull of (so many people have an incentive to hoard gold) that there must be something really wrong with the market at the moment.
Nope. Same exact thing happened in the early 80s, and it took a few decades to repeat. When speculators join the fray a bubble happens. If you were using gold to hedge against the inflation fairy, then you deserve to lose your ass in the market. That's how it is and always has been.But lost faith in gold is pretty amazing in it's implication, and it's without any precedents.
This has nothing to do with the article, but I'm bothered, so I'll complain anyway. This example is one of positive feedback, not negative. Simply stated, negative feedback means "a tendency toward stability." Positive feedback is the opposite. They have nothing to do with growth or decline. The author should stay away from using scientific terms he clearly doesn't understand. It tends to debase one's credibility.Outflows have picked up because sentiment has turned sour, not the other way around. But circular logic is what makes the financial markets go round—and in this case, down. That negative feedback loop is clearly entrenched in gold, which means the bugs should run for cover.