Analysts have little understanding for the rising price of gold, “says Robin Griffiths

Famous market said strategist Robin Griffiths recently King World News in an interview, many financial analysts in the West had not yet understood why gold and silver, had become more and more popular among global investors in recent years. His forecasts are based on the assumption that China will increase its gold reserves from 2 percent to 10 percent over the next few years.

Robin Griffiths has worked in finance for approximately 30 years and during that time have had an outstanding reputation. His technical analysis is valued high among investors. After having worked at HSBC for 20 years, he joined respected asset management venture Cazenove capital in 2008, where he is now working in the wealth management division. Griffiths believes that many analysts and journalists in the West has not yet financial understood why precious metals, especially gold and silver, has once again become very popular investment classes. According to him, their thinking too much influenced by the Keynesian economic theory, a theory which he expects to be thoroughly tested in the foreseeable future.

Griffiths States often analyses and media reports on precious metals are characterized by a negative undertone, particularly with respect to gold. If nothing else works, like the author refers to Warren Buffett’s statement that the storage of gold is too expensive and does not generate any interest. Many journalists, however, ignore the fact that international investors have to be strong in the sector for precious metals since 2001, after long decades of abstinence. According to Griffiths, the main impetus for the prolonged bull came from central banks flood the financial markets with liquidity. He assumes that the financial markets have already come to the conclusion that an increasing number of colorfully printed banknotes may eventually lead to a galloping inflation. The real problems would be obvious, when the average person began to understand this evolution.

In this context, says Griffiths attestes Asian a lead over their industrialised Western countries. In recent decades had particularly Asia’s emerging countries are often seen each week climbing food prices and seen the consequences of this development may have. For this reason, demand for precious metals have always been high among Asians. This was especially true for countries like India, China and Viet Nam. A large proportion of the population in these countries had realized the importance of gold and silver and were therefore, exchanging their paper money to precious metals for some time. The latest developments showed that China further deregulate its gold market and encouraged their people to buy precious metals. Vietnam’s Communist Government has on the other hand, tried to fight a flight into gold in order to prevent a further erosion of its national currency. Griffiths ‘ forecasts predict that China is increasing its current gold reserves from 2 percent to 10 percent for the foreseeable future. He expects the price of gold will therefore always be supported by new buyer interest after a correction, which would support the yellow metal future price developments.