The Iran war is effectively over.
The US can't escalate without sending oil to $200 over night, and Iran has demonstrated they are willing endure months of privation as long as they can make the global economy suffer witht them.
The US can't tolerate any more suffering than necessary with food and energy costs spiraling out of control (along with everything else.)
So the war is over.
That means the Straight of Hormuz is now under control of Iran/China/Russia. It is to their benefit to allow oil to pass through the straight but it will be on their terms.
This means A) oil is likely to remain closer to $100 dollars than the $50 dollars level before the war. In fact, many analysts have it climbing steadily towards $150 as so much middle east oil has been taken off line and it will take many months just to get back on line. This is excellent for GOLD because it means inflation will keep spiraling out of control.
B) The Middle Eastern countries will be able to begin selling oil again, so they can stop selling gold, and they will undoubtedly use the oil proceeds to buy back the gold they had to sell when the oil sales stopped flowing. Again, excellent for gold.
C) the massive cost of the US war machine will add an extra TRILLION to the budget. That is money that has to be printed out of thin air. This is the best news for gold of all, especially gold priced in dollars - since it destroys the value of the dollar.
So, in all excellent for gold. In fact, the perfect strorm.
Add to that, the certainty that a Fed dominated by the current adminsitration is sure to cut rates into this inflationary storm.
That will add jet fuel to the gold bull.
