Well, it may be more accurate to say "most of the gold bulls were caught by surprise". I never doubted for a moment that something like this would happen. To me, it was inevitable. Like the sun rising tomorrow.
That gold blew through the $500 mark to $530 and settled at $525 per ounce for the week was simply a confirmation of what I have been saying all along. The world is awash in fiat currency as never before and prudent investors are beginning to react to the fact as any thinking person would.
Sure, gold seems "expensive" now compared to what it was last month or the months before but one needs to consider the bigger picture - the global condition we are in, and if one looks at this thoughtfully, they will realize that the price of gold is going to go much, much higher.
The recent developments are because the people in one country, Japan, have come to this awareness. The article linked above mentions that the last upturn in the gold price was because Europeans came to the same conclusion. Country after country will reach the same point eventually at an accelerated pace and the price of gold will be reflected accordingly.
In 1980, gold was $800 per ounce. Adjusted for inflation, that is approximately $2,300 per ounce today. In other words, gold at $525 is cheap and, as I see it, an incredible bargain. I have droned on in the past about how our government steals the wealth of the citizens through the hidden tax of inflation but there is a "silver lining" to this and that is that since gold is denominated in U.S. dollars, gold becomes a better investment each and every day.
Sure, if you wait for a pullback, you might be able to save $10 - $20 per ounce but there are many people who subscribed to this thinking lately only to end up standing at the station and find the gold train has pulled away without them.
Here we get some insight into the near-term future:
Gold looks like a "no-brainer" to me.