By Lorimer Wils on 06 January 2012
Back in 2009 I began keeping track of those financial analysts, economists, academics and commentators who were of the opinion that it was just a matter of time before Gold reached a parabolic peak price well in excess of the prevailing price. As time passed the list grew dramatically and at last count numbered 140 such individuals who have gone on record as saying that gold will go to at least $3,000 – and as high as $20,000 – before the gold bubble finally pops.
Goldrunner uses fractal analysis off the gold bull market of the 1970s to arrive at his assessment of where gold is now in the bull run and where it is going. In his November, 2011 article he set forth the basics of his technical analysis and said:
“Early this year we suggested a 50% rise in Gold to $1860 – $1,920 into mid-year. Now, we see the Gold tsunami realizing an approximate 100% rise that will crest at $3,000+ into the middle of 2012.“
Bob Chapman: $2,500 – $3,000
In Chapman’s August, 2011 issue of the International Forecaster he had this to say about gold:
“Debt monetization will Lead to ever-higher inflation…and explain the systemic problem of many nations, which have nowhere to turn to except the creation of money and credit to temporarily keep their economies going…[and] when you put it all together you get higher gold and Silver prices…We would expect a move to $2,000 to $2,200, some backing and filling and a move to $2,500 to $3,000 by the end of February 2012, as we earlier predicted.”
Ian McAvity: $2,500 – $3,000
Ian McAvity, author of the newsletter, Deliberations on World Markets, speaking on Mineweb.com’s Gold Weekly podcast in June of 2010, said that while he is a gold bug, buying gold in the current economic climate is very much like buying life insurance for a short term capital gain. McAvity says that he expects gold to head north toward the $3,000 level over the next two years [i.e. sometime in 2012] but, says he cannot yet quantify “the magnitude of the crisis that takes it higher”. According to McAvity, one of the most critical factors for the gold price currently is the return on risk-free capital which is currently negative in real terms saying:
“As long as the yield on treasury bills is 40 to 50 basis points, then the perceived inflation rate is 200 to 300 basis points – basically holding paper is negative. And that is one of the strongest underlying features of the gold market and we basically have the central bankers and their quantitative easing load saying that they’re going to try and keep interest rates as close to zero as possible, until they successfully borrow their way out of debt. The concept of borrowing your way out of debt is I guess, the new math that I haven’t quite grasped yet.”
Kurtis Hemmerling: $2,500 – $3,000
In an August 2011 article posted at Seeking Alpha entitled How to Play Parabolic Gold Prices With a $2,500-8,000 Target Hemmerling says:
“While I put a one year price target of $2,500 – $3,000, it is difficult to know with any surety…but I think some added ‘shock news’ as we toy with another recession and the convoluted problems of the euro-zone, compounded by inflationary stimulus – will see the U.S. dollar-based price of gold go much higher over the next few months. My target is largely based on the recent steep climb that is getting dangerously close to setting up a parabolic price move. Fear is the catalyst, and I think resistance will be met at $2,000 based on it being a round psychological number. After some churning when it breaks that – we could see another big run between $2,500 and $3,000.“
Mary Anne and Pamela Aden: $2,000 – $3,000
In the April 2010 issue of The Aden Forecast the Aden sisters expressed their view that:
“[In the chart below] you can see an interesting pattern that’s been going on since 1969. Note that each major eight year low was followed by a major peak 11 years later. The only exception was the 1993 low, but in that case the low was mild within an essentially quiet market (see asterisk).
If this 11 year pattern continues, we could see gold shoot up to the $2000 – $3000 level within the next two years [i.e. by 2012]. But since today’s economic situation is historically extreme, we could see much higher prices for a longer period of time… well beyond 2012, and more like 2017-2018.
In their latest (November 2011) forecast they were still optimistic saying “gold is near a normal high area within a major uptrend, but it has yet to experience any type of explosive action. This is likely still to come once this current period of weakness is over.”
It should be noted here that the leverage of gold mining shares vis-a-vis the price performance of gold bullion plus the added leverage of the warrants of such companies vis-a-vis the performance of their associated stock supports the possibility of amazing gains for the right warrants of the right junior miners in the years ahead.