Yeah, Feachie - I was agreeing with you. I just quoted you to save us all redundancy.
Gold's performance is directly related to central bank activity worldwide. At the moment, most major players refuse to allow any deflation because of how much reality it would bring to the world. They have to keep the economy in a constant state of delusion to keep the debt game going.
It's like if every time you feel like sleeping to rest and recover, you just slammed a red bull. Eventually a single red bull isn't enough - you need two, or three, or four. The US has been playing this game for some time, and every time the Red bull wears off and the markets need to sleep, they just slam another one - this occurred on a small level in the early 90s and in the early 2000s - and the most recent incarnation is the equivalent of hooking up the guy with a buttload of speed:
http://research.stlouisfed.org/fred2...%5Bid%5D=AMBNS
Eventually it'll stop. Red bulls can't keep you awake forever. And the longer you've been awake, the more damage you've done to yourself and the longer you'll need to rest when you finally do.
So, that means most of the currencies worldwide are in a race to the floor as long as people are as overleveraged as they are. Once individuals and governments start changing course and reducing their debt in real terms, Gold will probably stabilize. Where it stabilizes, no one knows.
It might be or could become a bubble...but just because it's up nominally as much as it is doesn't mean it's currently a bubble. I don't really think it is, yet. It's simply not high enough.