Oil Money Pours Into Gold

Sheesh, I've been busy today -- Issues of Red-Hot Resources, Red-Hot Asian Tigers, and the first draft of the last update to my gold report, which should (probably) go out tomorrow.

Anyway, nice bounce in precious metals today, eh? During the recent decline, the big jewelers were buying gold all the way down. It's bargain hunting time for them. Who are they selling to? Well, with oil seemingly stuck over $60 a barrel now, who do you think has a lot of spare cash laying around...

The World Gold Council’s regional office in Dubai announced that the retail gold sales increased by 41% in the third quarter of 2006 compared to the same period of 2005. Sales figures in the UAE increased from 1.4 Billion Dirhams in the third quarter of 2005 to 2 Billion Dirhams in the third quarter of 2006.

A dirham is fixed against the dollar at a rate of 3.67. So 2 billion dirhams is 545 million in US money.

If you click through this link, you'll find that the money is going into bullion rather than jewelry. And sales are falling in Saudi Arabia and the other Gulf states. I guess the rich oil sheiks are parking their wives (and credit cards) in Dubai, just in case the sand hits the fan.

The story is full of interesting stats. Read it HERE.

And here is a chart of gold. Me likee...

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