Gold extends rally on continued global political tensions.
Gold for August delivery was last up $9.80 at $652.80 an ounce on the New York Mercantile Exchange, having earlier risen to as high as $653.30, its loftiest level since May 30. On Tuesday, gold futures gained $17.
Gold's rally has been fuelled by Tuesday's deadly bombings of rush-hour commuter trains in Mumbai as well as by the lack of a breakthrough in the west's attempts to stop North Korea and Iran from developing nuclear weapons.
As long as there is no resolution in the crises in Iran, Iraq, Gaza, and North Korea, "gold will keep drawing safe-haven buyers under its protective wing," said Jon Nadler, an analyst at Kitco.com.
Nadler is wrong about the reason, of course. As I've said before, the gold rally is not about terrorism or Iran. It's about the fact that the Fed will have to continue destroying the dollar in order to bail out overindebted consumers and the overindebted U.S. government. Gold will keep going.