El-Erian, the Fed’s Inevitable Unwind, and Gold: SPDR Gold Trust (ETF) (GLD), Barrick Gold Corporation (USA) (ABX)

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How to play gold
Even though gold miners such as Barrick Gold Corporation (USA) (NYSE:ABX) and Newmont Mining Corp (NYSE:NEM) have significantly underperformed gold as a commodity for some time (see the following chart), there are reasons to remain skeptical of the miners. When Barrick reported its most recent quarterly results, rising cost and environmental concerns were a highlight of the report; Newmont faced the same pressures and will continue to for some time. On a broader scale, the recessionary pressures that we’re all ignoring from Washington are likely to punish the miners more severely than the commodity or ETF. Given the interplay between so many current pressures, GLD continues to look very attractive as a vehicle for gold.

GLD Chart

GLD data by YCharts.

The article El-Erian, the Fed’s Inevitable Unwind, and Gold originally appeared on Fool.com.

Fool contributor Doug Ehrman and The Motley Fool have no position in any of the stocks mentioned.

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