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Friday, April 2, 2010

Gold Prices and Unemployment Claims

We've been talking some recently on Everything Gold about the false connections so-called financial reporters are making between alleged improved economic conditions and gold.

The latest example I found was in reference to the U.S. Labor Department reporting unemployment claims dropped to 439,000 last week. This particular writer actually connected this to the reason gold prices rose during the day.

Evidently the reasoning was because gold increased after the data were released, that means the small improvement was good news for gold. It defies belief that someone could be a financial "reporter" and be that clueless.

Even those not that familiar with gold know gold rises on bad news and uncertainty, not on good new. Oh, let's go buy some gold in celebration that everything is okay. Whoever hears that being said? Yet, that's the logic behind this ignorance.

We've been seeing that all over the financial news lately, and thought we would write some on it so those interested in investing in gold don't go around putting their money in the metal because they hear what is perceived as good economic news.

Imagine what that writer was implying: Unemployment claims dropped by a tiny 6,000 last week, so everyone went out to buy gold and caused it to surge in price because of the celebration of that fact. It doesn't get much more ignorant than that about why gold is invested in and what the causes behind it going up in price are.

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