The Five Reasons Gold Will Hit $5,000

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Let me get right to the point. Gold's going to $5,000 an ounce.

I know that sounds preposterous to most people. In fact, some of you probably think I'm crazy.

But for a whole host of reasons, $5,000 may well end up being a conservative estimate.

So before you start posting comments that I've gone bonkers, hear me out…

In 2001, gold traded as low as $255 an ounce. Within eight years, its price had quadrupled to more than $1,100 an ounce. How many investors thought that was possible, or even likely? Probably not very many.

Yet, it happened.

What's more, since hitting its secular bottom back in 2001, gold has posted a positive return in every calendar year. So far, the current bull market has been pretty orderly.

During the past 10 years, gold has indeed become the trade of the decade, beating out commodities, oil, high-grade U.S. corporate bonds, U.S. Treasuries, and yes, U.S. stocks.

A crisp $100 bill invested 10 years ago would today be worth more than $400 in gold, $357 in commodities (as measured by the S&P GSCI Enhanced Total Return Index), $268 in oil, $190 in corporate bonds or U.S. Treasuries, and only $90 in U.S. stocks.

That's right: We're talking about a $10 loss in U.S. stocks over 10 years. Ouch.

Meanwhile, gold has embarked upon a secular upward trend that is far from over. If the 1970's are any indication, gold's going much, much higher from here.

When U.S. President Richard M. Nixon opted to close the gold window in August 1971, the yellow metal had already risen from its fixed price of $35 an ounce to $42 an ounce. By the time gold peaked in 1980, it had risen to $850, rewarding early investors with a 2,400% return. My guess is that any such forecast in 1970 would probably have been met with the same kind of ridicule I expect that my current projection could attract.

Granted, there's no guarantee that we're about to duplicate the 1970s. (I could certainly do without the disco, bell bottoms and leisure suits). But a s Mark Twain once noted: "History does not repeat itself, but it often rhymes."

And that could mean even sweeter returns for gold investors this time around.

In fact, let's crunch a few numbers – just for fun.

Why $5,000 an Ounce Gold Isn't Out of Bounds

To start with, let's take the 1980 peak price of gold – $850 – and adjust it for inflation. That would take the price of gold to $2,400 in present-day terms.

Better still, let's take the 2,400% gain that gold experienced during the 1970s and translate it into present-day terms. From the 2001 low of $255 an ounce, a 2,400% gain would take the yellow metal all the way up to $6,120 an ounce, making my $5,000 price projection seem a lot more reasonable.

But these are just superficial price comparisons. If we look at what the fundamentals are telling us, it's clear that gold at $1,100 is a long way from its eventual peak, meaning it still appears cheap.

So let's take a closer look.

Five Fundamental Reasons Gold Will Soar

Gold Fundamental No. 1: You Can't Ignore Inflation: The 2008 stock market panic sent stock and commodity prices – including the price of oil – into a tailspin. And that launched the big debate about whether inflation or deflation would ultimately carry the day. Keep in mind that since 2001 – under benign price inflation of roughly 2.5% – gold has managed to rise about 400%. Meanwhile, the U.S. Federal Reserve is widely expected to keep short-term rates near zero through this year, leaving the door open for rampant inflation.

Meanwhile, quantitative easing to shorten the recession has caused America's monetary base to explode. Starting in October 2008, during a very short span of only four months, the central bank doubled the U.S. money supply, going way beyond anything ever attempted in the nation's history.

Worldwide, central banks have rolled out an unprecedented $12 trillion worth of stimulus programs, with most of the money still to be spent.

Make no mistake, inflation will win out over deflation.

Gold Fundamental No. 2: Investment Demand is Exploding: Large institutional investors – hedge funds and pension funds – are making large allocations to gold, as are individual investors.

The proliferation of gold-focused exchange-traded funds (ETFs) bears this out. The SPDR Gold Trust (NYSE: GLD), the world's largest physically backed ETF with 1,100 tons of the lustrous metal, is the sixth-largest holder of gold bullion. Individual investors have never had an easier avenue for owning gold.

This isn't just merely a U.S. manifestation. According to the World Gold Council, demand advanced 15% from the second quarter to the third last year.

Asia, with a population that exceeds 2.5 billion inhabitants and a long-standing cultural affinity for gold, is stoking global demand in a big way. China is overtly encouraging its citizens to buy gold and silver, while offering them gold-linked checking accounts. China is primed to overtake India as the world's largest consumer of gold. A quickly developing middle class whose members are experiencing rapid escalations in disposable income are a major bullish driver for the price of gold.

Gold Fundamental No. 3: Central Banks are Becoming Net Buyers: India's recent purchase of 200 tons of International Monetary Fund (IMF) gold was the likely impetus that pushed gold up over the $1,200 level in December. But more important is the sea change that has seen central banks morph from net sellers into net buyers of gold. BlackRock Inc. (NYSE: BLK), one of the world's largest investment managers, said that 2009 was that turning point. If that was the case, it will have been the first time in 20 years, as central banks have been net sellers of gold since 1988.

Gold Fundamental No. 4: A Currency Crisis is Looming: The "PIGS" – Portugal, Italy, Greece and Spain (or "PIIGS," if you want to include Ireland) – aren't in very good fiscal shape. And they aren't alone. Iceland has already gone over the edge. The United States, the United Kingdom, and countless other economies are struggling. And that reality has ignited a crisis of confidence about fiat currencies in the minds of many investors.
Money is nothing more than paper and ink, backed by the full faith and credit of the issuer. When investors find that their faith in the issuer is shaken, the value of that currency erodes. Additional sovereign-debt downgrades from ratings agencies are but one potential trigger of a currency crisis. Under such conditions, gold – the ultimate store of value, and the oldest existing form of money on earth – will soar as investors seek to protect their purchasing power.

Gold Fundamental No. 5: We've Yet to Reach the Mania Stage: As we've outlined before, the gold bubble that takes prices to all-time-record levels will inflate in three distinct stages. This process will start with currency devaluations in Stage One, will be fueled by growing investment demand in Stage Two and will experience its stratospheric ascent in Stage Three, the mania phase of this evolution.

Make no mistake, the $5,000 price point will most likely be reached in this third and final phase. The price of gold will behave like it is strapped to a jet pack. And today's market prices will be dwarfed by the levels gold prices will ultimately achieve.

Keep in mind, the entire gold industry has an aggregate market capitalization (value) below that of Wal-Mart Stores Inc. (NYSE: WMT) alone (currently about $210 billion). So as the crowd piles in, the "big money" to be made will lie with gold explorers and producers, where 1,000% returns will not be uncommon, even from today's prices.

All these fundamentals underscore that gold prices have plenty of room to run from here.

And since I expect gold will eventually reach the $5,000 range, that leaves plenty of room for investors to profit by entering at current levels.

It's Time to Make Your Move

Everyone needs some exposure to gold in their portfolios, no matter their age or risk tolerance. Owning some physical coins or bars makes sense, but it's complicated to do inside most retirement accounts.

That's why the explorers and producers of the gold sector promise the biggest payoffs. Although production costs will rise, as gold prices rise, profit margins are sure to expand even faster. Once cocktail-party conversations turn to gold, for any one of the reasons I've outlined, gold stocks will erupt and then streak for record highs.

When will this happen? I think it will take a few years. But with bubbles, or speculative frenzies, one never knows. Just this week, in fact, Robert R. McEwen, the chairman and chief executive officer of U.S Gold Corp. (AMEX: UXG), predicted that gold could more than quadruple to hit the $5,000 level by 2012. Some experts have labeled this expected move as a looming "superspike."

When this happens, gold is likely to create a whole new generation of millionaires, and even a few new billionaires. Despite the mania stage being several years away, the wise investor recognizes both the importance and the potential of investing in gold.

I have no doubt that today's $1,100 gold price level will eventually, in hindsight, look like an outrageous bargain.

My advice: If you own gold and gold shares, hang onto them and buy more on dips. If you don't, what on earth are you waiting for?

[Editor's Note : Peter Krauth is a contributing editor to Money Morning and is also the editor of the Global Resource Alert advisory service. A highly regarded market analyst and expert in metals and mining equities, Krauth specializes in energy- and resource-related investments.

A one-time portfolio advisor, Krauth is now headquartered in resource-rich Canada, where he focuses exclusively on his research. He last wrote about gold's potential to be "The Greatest Trade Ever," and detailed how super-investor John A. Paulson could use his gold holdings to vault himself to the top of the Forbes billionaire's list.

For more information on profit opportunities in gold and other commodities, check out the Global Resource Alert.]

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About the Author

Peter Krauth is the Resource Specialist for Money Map Press and has contributed some of the most popular and highly regarded investing articles on Money Morning. Peter is headquartered in resource-rich Canada, but he travels around the world to dig up the very best profit opportunity, whether it's in gold, silver, oil, coal, or even potash.

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  1. Fazsha | January 14, 2010

    Gold will not go to $5,000 an ounce, and anyone who thinks so is crazy.

    It's going to $8,000. Gold in private and government hands is worth about $5 trillion compared to global M3 money supply of $60 trillion. Gold would have to sell at $32,128 per ounce vs. $1,140 today to replace the global M2 money supply dollar-for-dollar. While it won't get to 100% backing, I could easily see it getting to 25-50% backing.

    • Terry | January 16, 2010

      If you think that gold will get to those levels, AND an individual will not be allowed to have ONE oz. of it……………..you have more trust in the Fascist system we have in the process of being built now, than anyone familiar with the system.

      We will be robbed blind, at every turn, because we're broke.
      And getting more so, day by day.

      Where do you think their coming first for more?.

      You will be paid a pittance,( just like FDR's theft) and required to turn it over, or else.
      I would love it, if we had an honest system, and men & women were truly paid for what the worked diligently, and long hours for.

      Sadly, after watching what's been done to our SS/MC/MA systems……..I see no hope for any honesty, or getting your just rewards for making SMART investents.

  2. Wayne | January 15, 2010

    gold will hit 1500 before summer, and 2000 before 2011 and if there are national or international catastrophes in this year then it will go up even faster and a higher price. One big scandal not even remotely resolved will be the tungsten gold plated covered bars, a discovery made last autumn but only recently released to the public, many millionaires and billionaires are franticaly testing their gold to see just how much they were cheated and sadly deducting their total worth because of the deep pervasive irreparably c orrupt dishonesty of the US fed govt. Another big threatening unresolved problem no one knows now just how much gold is in the world and how much the official count is off because of the tungsten bar scandal, and with dropping world production and increasing demand there could be much less gold in the world available than offically listed. The senior vice of the NYM exchange has taken leave and cannot be found and it is his office that the numbers of these bars are kept by mandate of federal law so this scandal involved the highest echelons of the US fed govt and by the numbers these bars could be traced to the mint or depository that made them thus implicating names, big names like Klintun Rubin and Greenspan . Thats the kind of govt we have folks…….endless senseless wars which take our finest and best costing us billions, invasions of other countrys later publicly admitted to been contrived lies and now they take our gold, remember theres not been an audit of Ft Knox since the 1950s there could be nothing there or it could be filled with tungsten 1/8 inch gold covered bars counterfeited years ago,, if our gold is indeed gone and this turns out to be true then who took our gold and where is it now and will the criminals be brought to justice?????

    • Jimbo | January 15, 2010

      Wayne…there's a reputable company in Miami called Republic Metals with whom i've had positive experiences trading Krugerrands

      • boatman | March 29, 2010

        jimbo–republic is a good compny, so is united precious metal refiners…….but coins are too high premiumed……..9999 gold is 9999 gold…..jewelers bars is the way to go…

  3. bobdin | January 15, 2010

    I agree in general with you renationalisation of the gold situation. While our current administration continues to recklessly spend like a college kid with a new card, our Historic Deficit grows by the day. While Washington DC can print money by the ton, they can't print gold. Congress and the White House seem to be obsessed with spending money we don't have. They continue to print currency backed by only a promise and are taking reckless advantage that we are no longer on the gold standard. This weakens the US Dollar and gold will go up accordingly. While it may not reach $5000 it will be close to it as it is apparent the spending will continue.

  4. colin andrew | January 15, 2010

    I read your your report of the coming future boom in gold prices, I have for around the last five years believed that this would happen, because I could see all around me people with little means at there disposal, living beyond there means on credit, the banks were throwing money at everyone, people would borrow and borrow, and the banks said here have some more, and when they could not pay there repayments, the banks said to them here have some more so you can pay us back, Well I did not have to be a Sherlock Holms to realise that something had to crack in the end, so over the last five years I have bought Soveriegns, and now have over 400, I bought many of them when the price was very low, my problem is where to sell them when the price reaches $2500, by the way I am still purchasing them any ideas, chears and happy neaw year. Colin

    • Terry | January 16, 2010

      Why would you sell, and why would you turn over REAL MONEY, for FIAT CURRENCY?.
      The ONLY thing in the next 18-36 months I would let Gold go for, is TANGIBLE items, of value.
      Another item you may want to think about, is since you bought a quanity (of an item that is scarce, and expensive now), why not sell , and increase you holdings NOW……before the prices go exponental possibly?.
      You have approx 100oz. of physical metal(with high premiums),and a low buy in……………
      Put it on paper, and see what I mean.

  5. g. stein | January 15, 2010

    hi yes i like this report very much. lets hope for all of us gold coin investers.this will become a reallityhave a good investing day g.s.

  6. GOLDInvestor | January 15, 2010

    Who is controlling the world gold prices? Just speculators at NYMEX. we observed from kitco graphs that all big changes that is upward or down side coming during NYMEX hours and world follows the few speculators seating in New York. Well ! they are using contrarian strategy to drive market completely reverse. As long as they have short positions, or will short none of the reason will work to drive gold price to high. seems they are so powerful and welthy guys, drives market oneside they decide(Generally reverse than public thinking!). That is the only reason now, pray these guys start buying their positions, none of the fundamental will help but just they will drive market oneside as they wish. Bubble will burst as soon as they achieve their target so public has fear when they will dropp it? ( As we all know happend with Oil from 143$ to 33$). Is there any way we know the smart welthy guys move?? if yes, we are in the business and that will be the world best analysis. Let us hope you might have some connection with NYMEX guys and we get the recommendation in time/ before time of their moves. All the best to all investors like me!!!

  7. Safe Dad | January 15, 2010

    When morale and sentiment are low gold will go up. I am amazed, shocked that overall American enthusiasm has diminished so quickly. Living in Canada and attending our our annual CFA dinner I always enjoyed that American Overlord bluster versus that Canadian 'we should try harder' mentality in our economists showdown. But the last 2 years the Americans have become meek and whiney – I am surprised that I miss that overbearing pomposity that America is famous for. We want America to be great and we want you to act like Americans – when gold goes up dramatically means America is going down – don't let that happen. Although gold production, sales and process is good for Canada.

  8. Anna | January 15, 2010

    What is the best form of gold to buy? I have never bought…

    • Terry | January 16, 2010

      Bullon coins, 1oz. ( IMHO)
      Least premiums over anything but Bars, but universally accepted.
      Easily recognized.
      DO Not get caught in the Nuimismatic, Semi Nuimismatic trap, unless your filthy rich.
      And folks who think/sell these telling customers that Gubmint will not ever confiscate those, dream on.
      Bars, are not the best way, as they will be required to be assayed before yopu sell…….add's more expense to them, in the end.( esp 10-400) sized bars.

    • joe | July 11, 2012

      Hi Anna well if your looking to buy gold to invest in I would buy pure 24kt gold never lose in it… anything else for an investment i would forget about it…

  9. Tom Gill | January 15, 2010

    Peter Krauth…while I appreciate your column and history of experience, I find it amusing that you cite Robert R. McEwen of UXG as being bullish on the future price of gold going forward when he just a few days ago sold over 9,000,000 million shares of his own stock in UXG…

  10. H. Craig Bradley | January 15, 2010

    ALL THAT GLITTERS IS NOT GOLD

    Every night on Fox News there are "buy gold now" ads featuring Gordon Libby (of Watergate fame). Seems to me we are actually closer to the the "mania" phase than otherwise believed. When gold is the subject of such "hard sells" one has to question whether gold is truly priced for value.

    Instead, gold remains a speculative asset (commodity). As such, it is subject to much volatility. Put another way, "gold takes the stairway up and the elevator down". So, if you buy gold ETF's or physical gold, there is the matter of market timing. Few individual investors will ever get in at exactly the right time and get out at the right time (price). So, if you are not good at market timing, then you are competing against seasoned commodity traders, who are apt to "hand you your head". Even if you get lucky, there is the seldom mentioned tax consequences.

    As Keith Fitz-Gerald already wrote here, the IRS does not consider gold in any form to be an "investment". Instead, gold is a "collectible" for Federal Income Tax purposes. Gold is currently taxed at the Capital Gains Tax rate of 28%. There are no short-term or long-term Capital Gains Tax Rates, just a standard rate for all collectibles. Then there is state income taxes, another -10% off your gains from gold. So, plan on subtracting -40% from your gold trading profits. To make money after commissions or fees, gold must go up alot from here, hence the hard selling I have observed.

    One more risk, there is no guarantee that the Federal government will permit individual investors to own gold indefinately. In 1933, President Franklin Delano Roosevelt signed an Executive Order (EO) forbiding the general public from owning gold and required all individuals to turn in their gold at a fixed exchange rate for dollars. If President Obama were to sign a similar order in the future, it could include a prohibition on gold ETF's (GLD) as well. So, you would have to buy gold and store it in a Swiss Account, far from the reach of Federal authorities. Remember too, "a buy" transaction is not a taxable event, only a sell.

  11. Jonathan | January 15, 2010

    I hope for all your sakes gold does hit this projection, but forgive me if I remain skeptical. Gold is a shiny metal that comes out of the ground. It has very few industrial uses, is used for jewelry trinkets and is NOT tied to any currency anywhere. Saying it is a hedge against inflation is like saying Monet paintings are a hedge against inflation. If we were still on the gold standard, it would be a hedge against inflation because each dollar would have a corresponding slliver of gold somewhere in a vault. The Fed/Treasury has about doubled our money supply in dollar bills without a corresponding doublling of the gold supply. Has the price of gold doubled?? If the price of jewelry gets too high people will stop buying it and then we are left with a few industrial uses, which will likewise find a substitute if prices get too high. Why not buy Monet paintings to hedge inflation? In fact, that might make more sense since there are only so many and no new being made, unlike gold which is continuing to be mined. You don't buy Monet paintings as a hedge (besides the fact that most of us could not afford them) is because the price depends on personal whim and general acclaim. However, if the next generation determines it doesn't like Monet's style, then the prices will drop and your inflationary hedge turns into a debt albatross. The price of gold is going up because public sentiment says it will go up, not for any sound reason that makes it a reliable hedge against inflation. Articles like this and blogs and radio ads and TV ads all make the price of gold go up, but don't fool yourselves into thinking that it has to do with anything but sentiment, just like a momentum stock. Someday the rocket will run out of fuel (new buyers) and then gravity will take hold and back down to earth you come. By the way, have you figured out how to buy groceries with your gold stash? No retail places are set up to accept it as legal tender like the old saloons. Good luck, know any good art dealers? I'm looking for a good Monet.

  12. Aprov | January 15, 2010

    Gold may go to $5k, or more, per ounce, but such an event would imply great financial chaos and worldwide stress. So, afterwards, we might see ……..

    "…men will cast forth their idols of silver and …. gold … to enter the caverns …. from before the terror of the Lord…" (Isaiah 2:20-21) and
    "They cast their silver into the streets…. their silver and gold are not able to deliver them in the day of the wrath of the Lord; they cannot satisfy their hunger…" (Ezekiel 7:19)

    The power of a one world government, soon to arrive due to financial chaos, will cause great trouble. Even the most astute investor will fail !

    Regards

  13. sushil bhatnagar | January 16, 2010

    All this hullbulla of gold prices going up etc,am sure the writer own's lots of gold stocks himself, so this propoganda about gold prices goingup. One of the reader rightly said that its all speculations of NYMEX.They will start this gossips and it will go round and round and foolish people will turn that gossips into "reality",by behaving like "sheeps", and start cornering gold,in turn fueling up the demand and hence the price.But I read somewhere that Saudi Arabia ,has discovered a whole mountain, which is full of gold and they have kept it a secret.It will be operational,once their oil reserves are depleted.It's millions of tons of gold down there.How much effect it will have on that 5000 dollar golden egg being sold by Peter Krauth ???

    • cocamams@gmail.com | January 20, 2010

      you think the Saudi's would be foolish enough to release this abundant amount of gold quickly… they would guarantee hold back and drive it higher especially them. would you knowingly risk a possible margin loss because you flooded a market, with product, they as every other business have cost. cost being relatively fixed, and there return exponential in a market like this.

      best of all opinions.
      cheers.

  14. Terry | January 16, 2010

    "The SPDR Gold Trust (GLD), the world’s largest physically backed ETF with 1,100 tons of the lustrous metal, is the sixth-largest holder of gold bullion. Individual investors have never had an easier avenue for owning gold."

    With a National Debt of in excess of 169 Trllion dollaras, and a more immediate debt of 14.2 T, I have a question……..
    THE SPDR Trust Fund,………..

    When the SHTF over the Currency crash(inevitable), do you actually think the SPDR is going to allow folks to cash out of their positions and deliver PHYSICAL Gold to them?.

    I say,No Way…………….their going to issue fiat currency for you "PROFITS".

    So, I guess my question is WHY would anyone invest in a PM fund, knowing they will never recieve the metals in physical form?.

  15. theone | January 17, 2010

    All this talk about inflation and gold,, and yet not a single mention of the most amazing metal of all?? wow.. Silver people… wake up and smell the roses… Unlike Gold, Silver has been used in industry for decades,, and each year we have less and less,, industrial demand has been stripping above ground stock piles for a long time now,, it is predicted that there is 5 times more gold above ground now then silver.. there are more new uses for silver each year then all other metals combined, and silver is 60 times cheaper then gold… a 60 to 1 ratio,, the historical ratio is 14 to 1… People,, the greatest wealth transfer in the history of this world will be when the dollars value drops and silvers value shoots to the moon…. if you don't believe me just do some research.. its easy.. the numbers are out there,, just take a min to look for them…

    • tyler | January 19, 2010

      I agree. I originally bought gold and got sucked into the gold market but after I did some research and studied the facts I sold my gold and bought silver. If gold does go to five thousand I would expect silver to go to five hundred. An investor would make way more money with silver. The author missed the real investment story in the metals. As for the guy who said we have to pay some forty percent in taxes thats the second time I've heard that. I don't plan on selling my silver I will barder it.

  16. Prof. Simpleton | January 18, 2010

    Q: who controls the world bullion (gold) market?

    A: the (Roth'ten'childs) & the Gang!

    All of you people here including Peter Krauth seemed to be missing the whole point! And that is GOLD PRICE Is A "Controlled" item being 'manipulated' by all the powers-that-be (Who (with their vested interests) do you think sit on the (WGC) World Gold Council?. Free market my foot! The sooner you people realized this the better.

    By right the price of Gold should've shot through the stratosphere a very long time ago! But these people "depressed" it so that they can maximise their profits at their own whims and fancies. How?

    I'm gonna to let you into a "little secret" that I bet not many of you ordinary folks out there knows about and are actully oblivious to these facts! Ever heard of the Gold "carry-over" trade? Yeah! Simply meant : Borrow money "cheaply" (like the trillions of USD now floating in the market at almost zero interest!) and invest (the billions which they ALSO "controlled" thru' their owned-Banks) in the bullion market! With the USD down as it is now, the 'killing' would make all the "RottenChilds" laughing all the way to their (verily-OWNED) Banks for the next 7 generations, at least!

    Comprande? Kapisch? (and here we are arguing like fools about this and that… blah blah blah!)
    ehehehehe!!!

    n.b. – Prof. Simpleton quotes (sic!) Confucius says: "Don't get confused!"

    p.s. anyway, I agree with Peter rgd. the Price of Gold shooting-up (as otherwise how else are these "sharks" goin' to make their monstrous profits, since they were the ones who manipulate the whole system for their own benefits, in the 1st. place?!?)

  17. K W Foo | January 21, 2010

    Gold price should go higher than now, at least to USD 2000 per oz as taking inflation and stock availability into consideration. Moreover, the present situation, all government just priting money without taking into consideration of their country currency value. All things in this world, must return to basis one day. Likewise, the monetary subject. In those olden days, gold is used a a form monetary transaction. therefore, one day, gold will get back to its olden days and being used a monetary tool in the business world. In fact, if one day the gold price shoot up to be more than USD 3000 per oz, I will not suprise. In fact, waiting for the day. Just to conclude, the quantity of gold being mined is getting less and less. But the cost of mining is increasing, hence, pushing the price higher.

  18. John Kerttu Houghton Michigan | January 25, 2010

    Why doesn't gold and silver, and all other commodities, too, keep up with inflation every year.
    If your theory is correct then gold should never fall behind inflation adjusted prices by 50% at any time.
    Yet, each time we have seen a bubble in something, Larry and the other GOLD SELLERS keep saying gold will double or triple in value within two years.
    I have seen the same thing several times in my 60 years and the GOLD SELLERS are always wrong about the exact amount gold prices will go up and how many years it will take.
    To reach equality at the NEW INFLATION ADJUSTED PRICE FOR ONE OUNCE OF GOLD;
    HOW MUCH WILL INFLATION BE OVER THE NEXT TWO YEARS?
    HOW MUCH MORE WILL MY JOB PAY ME TWO YEARS FROM NOW.
    HOW MUCH WILL THE BASIC NECCESSITIES, FOOD, SHELTER, CLOTHING,TRANSPORTATION, COMMUNICATION, COST IN 2014.
    Look deep into your own "crystal balls" and come up with a realistic answer.
    Dec 2009 Larry predicted gold prices would drop to 1080 and then rally. Today gold is $1097.
    Where will the price of gold be next month or next year.
    Why did the price of gold drop when the stock market dropped last week?

  19. PJN | February 2, 2010

    there is a great company that has been very helpful and knowlegdable in the precious metals. his analysts have been spot on and the mom and pop service is great. speak to patrick. company name is Yorkshire Bullion. add a .com to the name for the website. he gave me information that hadnt even come out yet and seems to have my best interest in mind and has made me quite a bit of money. i agree that gold will soar and everyone should be protected against what is going on

  20. Royce | February 10, 2010

    I agree with the comments made about the gold market being fixed by COMEX, NYMEX, etc. The problem with market manipulation though is that it is doomed to failure eventually. The COMEX may be able to short enough gold into the market to tamp down prices some but what about sugar? Coal? Oil? Copper? Cotton? etc. There is a day coming soon when the tide will sweep all this BS away and gold will reset its price and that probably will be upwards of $5000. Maybe more…who knows how bad inflation is in other sectors by then. My humble recommendation is to by physical metal and shun any proxy like ETF's. I know that many of you use them but they are very likely a tool of the suppression scheme. Good luck everyone and for heaven's sake buy some Krugerrands or Eagles if you don't have any. Stay away from paper gold and you won't get burned.

  21. thomas bleser | March 25, 2010

    Let's not forget the key point you mentioned, and that is before the scratch of a pen by a US president (RMN) a few score years ago, gold wasn't for speculative sale at ANY price because a few score years prior to that another scratch of another pen by another US president (FDR) had simply made it that way. and we had to solder jewelery loops to our gold coins and carry them around on our watch fobs (and/or bury it in our basements) to keep Uncle Sam from confiscating it in what some perceived as his national interest.

    Maybe it would be wise to hedge your risk by putting some of that speculative savings into other kinds of precious metal (copper, silver, platinum, palladium and so on).

    • rudi de klerk | July 6, 2013

      The only reason why America can print large amounts of dollars at present, and get away with it, is that the dollar is the only acceptable world currency in which you can purchase commodities on the open market at present. unfortunately, it is depreciating (losing value) rapidly due to the worldwide economical crises we experienced the past 4 years and the high rate at which America is borrowing money. THIS IS ENOUGH REASON TO BELIEVE THAT GOLD as well as PLATINUM COMMODITIES ARE GOING TO BENEFIT THROUGH IT IN FUTURE.

  22. finola fogarty | April 14, 2010

    where to sell ones gold is the question I need answered. I am in canada and am not sure where to go with it to minimize commissions.Also are there any good gold stocks to be reccommended at this juncture? Thanks all.

  23. lyle wilkinson | April 16, 2010

    please seng all stock recomendations

  24. rolf | May 13, 2010

    hello Krauth,

    whilst you positively believe much in gold as do most investment consultants or analysts, you made 5 logical points.

    still, as readers or potential investors, we have 4 logical concerns that no articles ever, by you or others, are concerned with, but which raise legitimate doubts on gold:
    1. how, where do individuals buy gold?!
    2. is it true u.s. gov. taxes 38% off gold sales?!
    3. is it true ETFs are considered paper money, not owning real physical gold – then what is the real risk, if any, of not owning real gold?
    4. how big a risk is there if Obama does the Roosevelt move of an EO to force us all to sell our gold at fixed (negative) rate to shorten our profits (no to mention also tax us at 40%)?!

    please someone, you Peter Krauth or someone at your publishing house, answer realistically,
    or else we have no use for subscribing to your publications!

    sincerely,
    rolf neumann

  25. SilverBars | May 13, 2010

    With Gold hitting $1250/oz it seems like we may hit $1500 by summer! Silver has been trailing though, unable to break its previous high. Maybe we'll see some action there.

  26. mike | June 17, 2010

    Gold hoarding like Pharohs

  27. Boris P | June 21, 2010

    LOL! You're playing musical chairs with people who are creating this market. They know when to stop, you don't. Many of you are going to find out how it felt to own Tulip bulbs at 1000 guilders only to wake up one day to find they are worth 10 guilders.

    Buy value, not hype.

  28. Alaskan Gold Miner | July 23, 2010

    I don't buy PM's to make money. I buy them in case the US government goes tits up and dollars are worthless, or in case there is a collapse and all the money in bank accounts and stocks goes "poof" and disappears.

    I buy PM's because I cannot get any human to tell me how the US gubment can deal successfully with the 14T+ in debt. Noone has proposed a solution to that problem that is acceptable. I don't think there is one.

    PM's MIGHT be worth something when dollars are toilet paper or are non-existent.

    I'd also recommend buying food, guns and ammo, water filtration/storage equipment, solar panels for emergency power (1 panel would provide power for a few lights and a radio), land that will grow food, gardening tools, etc.

    I think the financial crisis is in the preliminary stages and will get a lot worse before it gets better. It has revealed that our banks, investment firms, government regulators, US congress, etc, etc, etc are PACKED with criminals. We can depend on them to continue to act like criminals. THAT'S WHAT THEY DO. LOOK OUT FOR YOURSELF. THE CRIMINALS ARE OUT TO TAKE EVERYTHING FROM YOU.

  29. Ray | September 23, 2010

    Never exicted on gold remeber 80's

  30. tom | January 21, 2011

    Gold will decline back to $800.00 per ounce by june of 2011, and sit at this price for 8 years.

  31. Robert Van Etten | March 7, 2011

    R.C.V. here. My question is this. What happens when our economy causes us to sell off our sae haven of gold and silver? What will this do to the price of precious metals? I'm only thinking out loud but that is why we aquired them for when times get tuff. Thanks R.C.V.

  32. fred | March 19, 2011

    I have looked at the past….and no not 20 years back but more then that ,roam, France, Germany, and yes early America. history repeats it's self that is true. in all these places gold/silver were money, they were devalued by way of adding more copper to the coin or printing more fait currencies causing the buying power to drop, and as a side effect, inflation what has always happened. with every situation is this…..every one realizes the fait currencies is simply a counterfeit produced by a failing government, being that.. currencies or diluted gold/silver coins are based on gold it's self .even so to day (fractional reserve banking)the us fed still backs the dollar with gold but it's a minuscule amount and is gets diluted every time the government prints more cash, some one signs a loan, some one uses a credit card ex….. even if the us was all taxed 100% and every body had a job, the debt can never be paid back. china and other countries holding treasuries and dollars from America have already shown distrust thus far and china has actually ordered the people of the countries to buy gold/silver up and more then 50% are going back to the gold/silver currencies and they are getting rid of the worthless dollar . all in all in the end every civilization has failed on fait currencies and those who hold the gold/silver are rich…5,000 lol that’s a reasonable number indeed and sounds good, but if we crash the dollar and the world goes in to a depression…well I don’t measure any investment in dollar because it lies, so this is what i think will happen to the (value) of gold……like in Germany when they printed 1 to many marks and they imploded,1 oz of gold could buy an entire city block, those who have dollar fixed debts will be able to pay them off in a heart beat like nothing. and for your gold being taken??? its more like a buy back and who better to sell your investment off to when it bobbles then the government. So i don’t think 5,000 counterfeit dollars is out there to think will be a new value and i also think one day silver will be the same value as gold because it actually is….all i have to say to any one here thinking about investing. remember this… if you save 100 dollars in ten years it will only be able to buy 50 dollars worth of stuff due to inflation under normal circumstances (not hyper inflation) but if you take just your savings(100) and buy gold or silver (the actual coin or bar in hand) your value will still be able to buy 100 dollars worth of stuff and leave you with another 250 to play around with. 5,000 like in Germany wont even be able to buy you a loaf of bread if we hyper inflate and gold always stays up with inflation soo all your dollar fixed loans and such will evaporate when you sell some of your gold of silver to pay them off. Keep an eye on silver though because it is under a false value right now because of it being sold on paper and it shows 2 times more silver then is really out there and just wait until other governments buy up silver so go out and get a few 100 silver oz eagles and maybe 5 or six gold eagles and hold on for the ride..

  33. Charlie | April 17, 2011

    Wealth of knowledge, thanks for the good read!

  34. Yan vanDooren | January 21, 2012

    Today saturday 21January2012 a lot of these comments seem silly or wise. Nobody can predict the future accurately but smart girls and guys can observe trends. Gold is certainly more valuable than paper fiat money backed only by fuzzy promises made by weak and corrupt politicians.
    I bet on a further increase of gold from 1600$ per ounce this week to more than 2000$ this year 2012. More will be a bonus and less will be a slight disappointment.

    • EdJanowsky | March 1, 2012

      Today is March 1, 2012. Gold right now is $1718 and silver is $35.06 so Tom you were a little off on your $800 gold for eight years prediction!

  35. brian | March 14, 2012

    OK OK I will buy some gold hide it in the ground . Its a wonderfull world !

  36. Minoamike | March 26, 2012

    Sorry guys, but I'm selling all my gold and holding my silver coins. I'm going to enjoy the money now while I can. New election coming you know.

  37. Ramoncito Ulep | May 22, 2013

    A little bit off on this prediction. Hopefully no one loss a lot of money because of this article. NEVER put all your eggs in one basket – or in this case, in one trade.

  38. au4sale | April 9, 2014

    I have some gold mine pattons should i sell them or keep them?

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