Post by jeffolie on Nov 5, 2009 14:04:11 GMT -6
There are many wild speculations as to how high gold and silver could go including this one from the well know blog, Minyanville. I do not remember Minyanville getting onto this bandwagon of wild speculation so I am pleasantly surprised.
There is no 'jeffolie predicts' speculation as to the ultimate price of precious metals. I merely predict a Dollar crisis causing the end of the financial world as we know it by 2013. That prediction means that precious metals will be a safe haven to ride out the collapse of the Dollar until America resolves its unsustainable financial position. Other countries have resolved their unsustainable financial positions in different ways.
America may copy the Paul Volcker approach and raise rates. I do not expect the Fed to raise rates to protect the Dollar until it is way too late when the confidence in Treasuries has waned. Conventional wisdom is that Treasuries are the ultimate safe haven more the main stream financial industry. This is wrong. Under Volcker Treasury interest rate rose to levels that crushed Treasuries investors.
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Why Gold Could Still Triple From Here
from Minyanville
The American Enterprise Institute for Public Policy Research (AEI) published a paper indicating that “by all relevant debt indicators, the US fiscal scenario will soon approximate the economic scenario for countries on the verge of a sovereign debt default.”
Steven Hess, Moody’s lead analyst for the US, put it this way on Reuters TV: “The Aaa rating of the US is not guaranteed. So if they don’t get the deficit down in the next three to four years to a sustainable level, then the rating will be in jeopardy.”
David Einhorn of Greenlight Capital, recently speaking of why he’s become a fan of gold, had this to say:
I have seen many people debate whether gold is a bet on inflation or deflation. As I see it, it is neither. Gold does well when monetary and fiscal policies are poor and does poorly when they appear sensible. Gold did very well during the Great Depression when FDR debased the currency. It did well again in the money printing 1970s, but collapsed in response to Paul Volcker’s austerity. It ultimately made a bottom around 2001 when the excitement about our future budget surpluses peaked.
Einhorn added, “Prospectively, gold should do fine unless our leaders implement much greater fiscal and monetary restraint than appears likely. Of course, gold should do very well if there is a sovereign debt default or currency crisis.”
www.minyanville.com/articles/gold-record-high-strategists-analysts-deficit-debt-US-minyanville/index/a/25289/p/1
There is no 'jeffolie predicts' speculation as to the ultimate price of precious metals. I merely predict a Dollar crisis causing the end of the financial world as we know it by 2013. That prediction means that precious metals will be a safe haven to ride out the collapse of the Dollar until America resolves its unsustainable financial position. Other countries have resolved their unsustainable financial positions in different ways.
America may copy the Paul Volcker approach and raise rates. I do not expect the Fed to raise rates to protect the Dollar until it is way too late when the confidence in Treasuries has waned. Conventional wisdom is that Treasuries are the ultimate safe haven more the main stream financial industry. This is wrong. Under Volcker Treasury interest rate rose to levels that crushed Treasuries investors.
=====================================================
Why Gold Could Still Triple From Here
from Minyanville
The American Enterprise Institute for Public Policy Research (AEI) published a paper indicating that “by all relevant debt indicators, the US fiscal scenario will soon approximate the economic scenario for countries on the verge of a sovereign debt default.”
Steven Hess, Moody’s lead analyst for the US, put it this way on Reuters TV: “The Aaa rating of the US is not guaranteed. So if they don’t get the deficit down in the next three to four years to a sustainable level, then the rating will be in jeopardy.”
David Einhorn of Greenlight Capital, recently speaking of why he’s become a fan of gold, had this to say:
I have seen many people debate whether gold is a bet on inflation or deflation. As I see it, it is neither. Gold does well when monetary and fiscal policies are poor and does poorly when they appear sensible. Gold did very well during the Great Depression when FDR debased the currency. It did well again in the money printing 1970s, but collapsed in response to Paul Volcker’s austerity. It ultimately made a bottom around 2001 when the excitement about our future budget surpluses peaked.
Einhorn added, “Prospectively, gold should do fine unless our leaders implement much greater fiscal and monetary restraint than appears likely. Of course, gold should do very well if there is a sovereign debt default or currency crisis.”
www.minyanville.com/articles/gold-record-high-strategists-analysts-deficit-debt-US-minyanville/index/a/25289/p/1