What’s going on with gold? After surging above $5,000, gold has fallen back about 20%. That’s not surprising after such a strong move, but it does beg the question of why? The conventional wisdom is that the dollar is stronger because, while the U.S. economy has its own debt problem (more on that later), it’s still the best house in a bad global neighborhood. And much of the world’s business is still denominated in dollars.
Since the dollar and gold typically move in opposite directions, gold would have to drop. There’s some merit to that, perhaps. It's also likely that many speculators who hopped on the gold train as it was chugging higher decided to cash out.
