Roubini Says Rogers’s Forecast of $2,000 Gold ‘Utter Nonsense’

Think about it. There are no people on the planet who are smarter and more market savvy than those top guys in IMF. Are those guys giving away their wealth so easy?

 

Gold set to overtake status of US dollar, analyst
4 November 2009 | by Paul Hayes
The combination of another record price and news that the Reserve Bank of India purchased 200 tonnes from the IMF for around $6.7 billion is evidence that gold is overtaking the US dollar as a reliable official reserve, a senior resource analyst told MINING DAILY.

“Many national economies no longer trust the US dollar,” H3 Global Advisors’ Mat Kaleel said.

“This purchase is a clear sign from India, which is going to become the world’s third largest economy at some point, that it does not trust the US dollar anymore.

“This is not a cyclical thing, but rather a significant change in the structural nature of the US dollar, which is losing its reserve status.”

Overnight updates saw the price of gold reach a record of high US$1084 per ounce, jumping thirty cents in price from the beginning of November.

The spot price of gold also rose, reaching US$1087 per ounce, up 2.6% from US$1059 per ounce quoted late Monday.

According to Kaleel, while the price of gold may be volatile in the short term future, the high prices are likely to remain for the long term, and this will continue to push the confidence in gold above the US dollar.

“We believe this is the start of a very long term trend,” he said.

“The long term floor for gold is probably around US$900 to US$1000, at which point the Chinese, the Indians and probably 10 or 15 central banks would happily dispose of US dollars.

“The smartest people in the world are buying gold. It is an inflation hedge, a deflation hedge and a hedge against government fiscal irresponsibility.”

http://www.miningaustralia.com.au/A...rtake-status-of-US-dollar-analyst/504421.aspx

 

It was explained very clearly in the post. Interest rates rise, which will increase the value of the dollar through interest rate parity. Couple that what I fully expect to be solidly robust economic growth with the first signs of unemployment to at most 8-7.5%, and that will be even further fuel for gold going to that level. Oil will decline in that scenario as well, for slightly different reasons depending how dependent the economic growth will be on demand for oil, which I can't say won't increase, but we have a massive oversupply.

 

"Gee, no agenda here!"

This is an extremely biased puff "opinion" piece for gold from the mining folks. There are a lot of suppositions but no facts.

In other words, read it again, it is a commercial advertisement.

You shouldn't post this like it is factual.

For example, saying that India doesn't trust the dollar - who said that but the jack-off they interviewed - India didn't say that.

Perhaps they are just diversifying or adjusting their position or trading the trend or hedging their dollars? 7 Billion is not a monumental amount for a Central Bank.

 

Agreed. This will be the short of a lifetime for many of us. I am already setting aside funds over the next year or two for when this happens. When gold does collapse, it will be a glorious demise. I want to take a huge swing at it.

Meanwhile, public hysteria, myth and misinformation will drive it higher for a while.

The key is to wait, a lot of people will lose a lot of money trying to short it too soon. It will keep making new highs for a while yet.

 

Unemployment at 8%? Noone expects that to happen for at least a year, and they're the optimists... Sure, you can think about V-shape, but the fact is that the "growth" is cash-for-clunkers and stimuli. U-shaped, my friend.

Agree with slapshot...

 

Jeez, what's with all the gold bears here?

 

Gold just retains value.. its better to put money in the stock market where it actually can make money. Have you noticed gold moved from 900 or so to 1050, but the S&P moved from 700 to 1100. The S&P is way more volatile, and that's better for traders.

It's like diversifying too much. You don't make money, you don't lose money, you just keep the money.

 

You are comparing a short timeframe of gold's performance to one of the greatest stockmarket rallies of the last 100 years.

Gold averaged a 16% anual return this decade, I would dare to state this outperforms a lot of investors on ET and elsewhere.

 

You're out of touch with reality and the facts. Look at the Fed interest rates over a few decades. The trend is down into the ground. Rates are not going to rise by any significant amount. Unemployment will only grow. USD is well on its way to being devalued.

Regardless, the world has been flooded with dollars and all major holders know that they are holding worthless paper. Noone wants to start the game of musical chairs but eventually someone has to.