Gold is going to $1000-2000 dollars. Ain't no way to avoid that given the fundamentals for the dollar, deficit, CA deficit, public and private debt, job outsourcing, manufacturing export, Chinese and Indian preference for gold, etc. Only people who now understand gold are goldbugs and enlightened Wall Streeters. J6P is not in on this move yet. Until you see the unwinding of those fundamentals, gold will be moving up. We aren't even seeing a hint of unwinding. In fact, the fundamentals will be accelerating to the downside with the subprime-prime loan debacle.
The move in gold will likely out do the internet bubble, and as I recall, the top subject at cocktail parties back then was, how much Softbank did you buy, etc. Even Ted Turner fell for it, buying AOL, losing the bulk of his fortune. We aren't anywhere close to that point in gold. Investment advisors still bash gold. Wait till they are recommending 5-10% of your portfolio being hedged in precious metals.
Gold season's coming to an end this month, so best time to buy in will be in the April-June time period.
If gold goes up as I am speculating, gold miners will follow, as the leverage to gold accelerates with gold pricing, as the costs to mine figure less and less in the cash flow.
One last thing, and that is that the Fed actually prefers gold to go up to reflect inflation, contrary to conventional wisdom, only they don't want it going up too fast. It makes precious metals a very good LT investment. |
