price of gold Long touted as a safe investment, gold got off to a radiant rally at the start of 2014. Risk-averse investors looked to gold-mining shares to counter a sluggish economy in the States and turmoil in the Ukraine, raking in twice the return of manufactured gold. A recent Bloomberg article showed a 25 percent advance in the Market Vectors Gold Miners ETF compared to 12 percent for the SPDR Gold Trust.

 

But what led to the early-year spike?

 

2013 saw gold plummet 28 percent, the most crushing drop since 1981. A surge in U.S. equities coupled with lackluster inflation had many investors scrambling to rid themselves of gold. Big name gold producers in the Philadelphia Gold & Silver Index slashed spending and sold assets to mitigate the damage. Miners slowed production. A surge in U.S. equities coupled with lackluster inflation When 2014 rolled in, keen-eyed investors saw the opportunity and snatched up shares at bargain basement prices.

 

Thus, the rally began: 21 percent for the Philadelphia Gold & Silver Index and 13 percent for the price of gold futures in New York. Analysts predict the top nine gold producers to rake in $2.3 billion in free cash flow in 2014, a reversal of fortune from the $5.2 billion deficit just a year earlier. Gold futures in New York reached a six-month high in mid-March. However, unhappy laborers nudge many investors to choose physical gold over the company shares.

 

Meanwhile, miners continue to look for ways to cut gold mining costs and achieve leaner production. Companies like General Kinematics offer energy efficient mining equipment to help miners save money, streamline mining processes and improve worker safety.

 

The crisis in the Ukraine and looming labor strikes in South Africa make gold an investment to watch. Both the Market Vectors Gold Miners ETF and the SPDR Gold Trust saw impressive early-year inflows, with the ETF taking the lead and the SPDR maintaining a near 2-to-1 ratio overall. Analysts are optimistic, investors are wary and miners are playing it safe. The price of gold won’t rise forever.

[photo via Bloomberg]

Leave a Reply

XHTML: You can use these tags: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Related GK News

ISRI Booth 2019

FOR IMMEDIATE RELEASE: General Kinematics Attends ISRI 2019

For Immediate Release General Kinematics                                                                                Marketing Dept.: (815) 444-3521 marketing@generalkinematics.com     FOR IMMEDIATE RELEASE: GENERAL KINEMATICS ATTENDS ISRI 2019     Beginning April 8th in Los Angeles, California thousands of attendees and hundreds of exhibitors convened to discuss the latest innovations in scrap recycling technology at ISRI 2019.   Attending this year’s event, […]

Read More
GK at CastExpo 2019

GK at CastExpo 2019: Pre-Show Announcement

CastExpo 2019 is quickly approaching! From April 27-30, the General Kinematics team will be at the CastExpo tradeshow in Atlanta, Georgia. It’s the largest North American expo for metalcasting suppliers, buyers, and metalcasters. CastExpo will have tech demos, full-scale exhibits, keynote speakers, thousands of attendees, and more. General Kinematics will be on site to meet […]

Read More
all about biomass equipment by GK

All About BioMass Equipment

Processing biomass incorporates various types of materials like wood, wood pellets, grass, yard waste farm waste, and more. Because of this, biomass processing equipment is designed to handle specific processes, including vibratory screening, density separation, metering, or material drying. When the right biomass equipment is chosen, processes can be completed thoroughly and efficiently, cutting down […]

Read More