With the rise in gold prices, Dietze said he is worried that oil prices will follow the trend upward, putting pressure on consumers at the gas pump.
“Once the gas price starts going up, people aren’t going to have money to pay for their other necessities," he said. "How can that be a bullish case for stocks?”
In the meantime, Lydon said although there are many investors who are worried about the markets, there’s still approximately $4 trillion sitting on the sideline.
“From a gold stand point, there might be a thread of inflation, but we haven’t seen it yet,” he said. “There’s demand out there. We’ve got emerging market countries that are booming. You’ve got millions of citizens there that have a great demand for gold. So yes, it’s a hedge against inflation and against the stock market, but surely there’s demand and for the first time in a long time, true ETFs have the ability to speculate so there’s a bit of a speculation tinge to this that you have to factor in too.”
SPDR Gold Trust
No immediate information was available for Dietze or Lydon.