Poor GDP Report Pushes Gold Prices Up 1 Percent

While gold has been hobbling along throughout July, the lower than expected numbers of the GDP report caused it to surge in the last trading day of the month by 1.1 percent, reaching $1,183.90 an ounce on the COMEX division of the NYMEX for December delivery.

Even so, it still finished July down 5 percent, falling $62.68. Spot gold price increased to $1,180.97, rising $12.20. This was the worst month for gold since December.

Gold surged on the day because gold investors rushed to cover their short positions in response to the GDP numbers.

Nothing has changed in the fundamental reasons of why gold has continued to rise over the last decade, and that will continue on.

Even the government attacks on the alleged fear-mongering of those pushing gold coins over gold bullion won't deter the rise of gold. The government attack is to shut up the voices of those who rightfully point out the risks related to the governmental policies around the globe which have brought to the economic catastrophe we're now experiencing.

Using Glen Beck as a focal point and the gold company he works with to sell gold coins and bullion, the government is using a few complaints (assuming they're even legitimate) to make it look like the reason gold is going up is because of unwarranted use of fear to sell gold coins rather than gold bullion.

The idea is to make a connection between gold and fear in a way that makes it seem like a bunch of hype. Don't think this isn't being orchestrated, even if a few innocent dupes are being used by the government to attack people investing in gold, which is a daily reminder of the failed and irresponsible policies of the government and Federal Reserve.

Giving the advice to acquire gold coins rather than gold bullion has been one that has been offered by many advisers for years, and it will continue to be because it's much more portable and easier to hide than bullion. Of course how many people can even afford to buy gold bullion in the first place, making this even more suspect.

Anyway, back to the fundamentals. Gold will continue to rise because of the practices attempted to be hidden by the government and Federal Reserve of continuing to print money and "stimulate" the economy, the ongoing sovereign debt crisis in Europe, and increasing and dangerous government deficits which are becoming more risky by the day.

Investors have been caused to dangerously relax because of the so-called banks stress tests in Europe which made it appear as if the majority passed with flying colors, while experts said they were in reality a joke. Even Citigroup (NYSE:C) noted, of the banks tested, 24 should have failed rather than only the seven asserted to have failed.

Even the downgrade of Ireland's debt recently was shrugged off as irrelevant by investors, who seemingly have swallowed the kool-aid.

The economic condition of the United States is dismal, China is being forced to slow, and Europe is in shambles, yet nobody seems to have remembered these things.

Maybe the BP (NYSE:BP) fiasco temporarily got their attention off of the ball. But that is close to being over as far as permanently plugging the oil well goes, and people are getting interested in other things again.

The fact that gold moved nicely today on just missing the GDP numbers by a small amount, shows investors are looking for a reason to push prices up again, and I don't think it'll take that long before it happens.