Since there is so much optimism here about the price of gold, just wondering what could take the price of gold down.Profit taking?..so far every bout of profit taking has resulted in buyers quite quickly steppping in. Stock market recovery?...can't see any extended rally to test this theory.Plummeting Asian jewelry demand?...don't know enough about this one. Government selling?..I'm more concerned about gov'ts THREATENING TO SELL,creating a (probable) temporary fall. The only thing i can think of is that no one has any money left to buy gold(only half kidding)....do you guys have any suggestions as to what could derail this (short or long term).thanks again.

A meltdown of the European banking system? In addition to their exposure to CDO, MBS, ABCP and so forth (don't you just love these acronyms?) German, Austrian and Swiss banks have major exposure to Eastern Europe and Former Soviet States. These loans have as much chance of being paid off as a penguin running for governor of California. So, the next question is, what about the credit default insurance tied to those loans? Who's the counterparty and are they already insolvent?

Add to this that the UK, Spain, Italy and Greece are basket cases and you have a scenario in which gold might be sold to shore up balance sheets. It is, after all, the most liquid asset and it fetches a good price these days.

This is different from the gold suppression racket however, so I don't think these banks will telegraph their intentions. How you'd learn about it in advance is anyone's guess - watch what bullion traders are doing I suppose.

ebear