Gold isn’t doing much in dollar terms – apart from the fact that it apparently still doesn’t really want to stay below the $1,200 level – but it remains quite strong in euro terms. In yen terms it isn’t really doing much lately, but remains well above the lows seen in the past two years. Obviously, the people who either buy gold as insurance or refuse to sell it at current prices (=high reservation demand) remain at work. The source of demand at the margin represented by today’s gold buyers has much to do with concerns that the central bank policy induced party in “risk” will inevitably end. This is to say, these buyers look beyond fundamentals in the here and now toward the day when it insurance may actually be needed (we have first mentioned this last year as it were, and believe it continues to be true). It is a case of better having insurance and not needing it, than one day realizing that one needs it but doesn’t have it.