For much of 2009, gold traded in the range of low-mid $900 per ounce. There was a dip over the summer, with a strong upswing starting in September. Gold is now trading well over $1,000 per ounce, in fact just under $1,100.

Turns out that the government of India was buying gold in mid-October. Over a two-week span, the central bank of India bought 200 tonnes (metric tons) of gold from the International Monetary Fund (IMF) at an average price of $1,045. The IMF — over which the U.S. holds veto power for most actions — got approval to sell the gold from — where else? — the U.S. Congress, last spring.

Previously, the government of India held 350 tonnes of gold reserves. This 200-tonne purchase is a 57% increase in India’s reserves. There’s joy in India, I’ll bet. (It makes me wonder what the Pakistanis think, now that their large neighbor has both nuclear weapons AND a growing gold hoard.)

To read the rest of the story and learn more about China’s golden ambitions, click here.

We know inflation is coming due to central governments around the world printing up trillions in new currency in an attempt to pull out of this global recession.  Inflation will send gold prices much higher.

In addition, gold is known as the crisis commodity and we have certainly seen geopolitical risk picking up lately.

A mad man dictator in North Korea just set off a nuclear device and shot off a few missiles.  Kim Jong Il wouldn’t hesitate to sell a nuclear device to a terrorist.  Even China is running out of patience and the world is about to turn the screws on the North Korean regime.

The North Korean people need to get rid of that evil regime which ran their country into the ground, and embrace freedom and democracy.

What’s more, Iran is continuing to irritate the civilized world and further isolate itself by developing nuclear weapons, rather than focusing on their faltering economy.

There is a good chance that Israel will attack Iran’s nuclear facilities if the hardliner Iranian President Mahmoud Ahmadinejad is re-elected next month.

Hopefully, the Persian people will take this opportunity to elect moderate political leaders so we can avoid a major war in the region.

War with Iran could easily escalate up to the use of nuclear weapons.  Iran will become a glass parking lot and gold will be over $5,000 per ounce.

Then, you have the Taliban which is trying to take over nuclear armed Pakistan.  Do you think the Taliban would even hesitate before starting World War III?

Higher inflation and geopolitical risk are just two reasons to own gold.  Make sure a portion of your investment portfolio is in the yellow metal.

Source:Next Stop for Gold is $1,000 Per Ounce!

Traders cited the cratering dollar, combined with international tensions stoked by rumors that Israel might be planning an attack on Iran.

Kevin Kerr, editor of Global Resources Trader said that “fear by far is the biggest driver right now … Shorts were certain earlier in the week that oil would freefall and with [Thursday’s] rally and then [yesterday’s] event, even hardened traders are left shaking their heads.”

That flame of fear was fanned by Israel’s Transport Minister Shaul Mofaz, a close adviser to Prime Minister Ehud Olmert, who was quoted in a local newspaper as saying that if Iran continues with its program for developing nuclear weapons, an Israeli attack on that country’s nuclear sites is “unavoidable.”

Morgan Stanley analysts wrote that they expect to see a short-term spike in oil prices, with crude-oil shipping patterns suggesting that prices for West Texas Intermediate crude will reach $150 a barrel by July 4.

“Distribution patterns of crude oil out of the Middle East are mimicking those of last year as we exited 3Q07, when we predicted an oil price spike into year-end based on our projections of sharp inventory draws in the Atlantic basin,” the analysts wrote. “That same pattern is now again upon us, and we are making an identical call, only this time we are starting from a much tighter Atlantic Basin inventory backdrop.”

Source: Meanwhile, Crude Heads for the Moon