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Iran Making Trouble For Europe?

It’s no secret that Iran has had a tempestuous relationship with the West; well their latest move could rankle Europe.

The Iranian central bank has announced that it will sell 45 billion euros from its foreign exchange reserves to buy dollars and gold .

And other published reports say Iran isn’t the only Mideast nation looking to dump euros.

"Other countries such as the Persian Gulf littoral states are also reported to be taking major steps for the conversion of their euro reserves into dollar and gold ingots," the report said, without identifying any countries.

What should you make of it?

I’m interested in the political reasons behind it, muses Brian Kelly. If Iran and other hostile nations start buying up gold, for strategic reasons other central banks around the world will also start buying gold. That could create a bubble-like scenario where valuations get totally skewed.

It's a good point but I wouldn't follow the central banking policies of Iran or other hostile nations as a thesis for trading gold, counters Tim Seymour.

Long gold has been the right trade for the past 10 years, Joe Terranova says, and there’s nothing about the action in gold now that suggests to me it’s near a top.


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Trader disclosure: On June 2, 2010, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (SWN), (GLD), (IPSU), (RSX), (PFE), (TER), (APA), (AXP), (BMO), (BBY), (DIS), (XCO), (AAPL), (CVS), (IPI), (TEVA), (FXB); Adami Owns (AGU), (BTU), (C), (GS), (INTC), (MSFT); Kelly Owns (FXE) Calls; Kelly Owns (IBM) Calls; Kelly Owns (STD) Calls; Kelly Owns (NBG) Calls; Jon Najarian Owns (GS), (JPM), (CAM), (BP); Finerman’s Firm Owns (AAPL); Finerman Owns (BAC); Finerman’s Firm Owns (BAC); Finerman Owns (BBY); Finerman’s Firm Owns (BBY); Finerman Owns (BP) Calls; Finerman’s Firm Owns (GOOG); Finerman’s Firm Owns (GS) Calls; Finerman Owns (HPQ); Finerman’s Firm Owns (HPQ); Finerman Owns (JPM) Calls; Finerman’s Firm Owns (JPM); Finerman Owns (RIG) Call, Puts & Stock

For Joe Terranova
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