Word: golds
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Dates: during 1970-1979
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...latest frenzy was heightened last week when so many bids were presented at Washington's monthly bullion auction that the U.S. Treasury could have sold four times the 750,000 oz. it offered. That, along with rumors of especially heavy orders for gold from buyers in the Middle East, stirred a wave of panic buying that pushed the price of bullion up by a record $24 an oz. in just one day. Trading was so hectic that the normal 500-an-oz. spread between buying and selling prices widened at times to $5. Gold hit an all-time high...
Much of the buying was done by speculators who had earlier bet that gold would fall, and now had to run to buy to cover their short positions. At the same time, two events added to doubts that Western policymakers would come to grips effectively with their common economic problems. In Paris the finance ministers and central bankers of the Big Five monetary powers-Germany, Japan, France, Britain and the U.S.-failed to end a potentially damaging interest rate war among them. And the International Monetary Fund issued a gloomy study predicting a worsening economic outlook...
Fears that OPEC oil prices would rise and supplies would tighten also helped speed the rush to bullion, as did the perceived political weakness of Jimmy Carter and the threat of a challenge from Edward Kennedy. Some European dealers are calling the gold surge a "Kennedy rally" because it has been spurred by expectations that his free-spending, liberal policies might exacerbate U.S. inflation if he were elected. In the thin, highly volatile market, that distant worry is enough for a big rise...
After Carter's belated move to shore up the battered dollar in November 1978, the Administration showed little concern about the gold boom. As long as gold buyers were not singling out dollars for heavy selling, the fever was viewed as a monetary nonevent. But this complacency faded rapidly late last week when the greenback plunged 2% in just one day against the West German mark, to the lowest it has been since last October. The weakness caught Washington unprepared. Said one Treasury official: "There simply isn't the mental horsepower in the White House to deal with...
...gold frenzy continues to weaken the buck, OPEC might again move to lift its dollar-denominated price of oil sharply. Uncertainty over just what the greenback will be worth in months ahead would slow much trade that is negotiated in dollars. Beyond that, economists disagree about whether gold itself poses any threat. Many believe, as Economist John Maynard Keynes said, that gold is just a "barbarous relic," a commodity like pork bellies that should have no more monetary impact than wampum beads. Yet in this real world, the bullion boom could ultimately prove highly inflationary...