As a Money Morning Member, you'll get our top financial news stories delivered straight to your inbox – every weekday morning.
Cancel at any time | How it works
Welcome to Money Morning - Only the News You Can Profit From.
Private Briefingwith WILLIAM PATALON III, Executive Editor
Not a member yet? Right now, you can get exclusive access to the 7 Best Stocks to Own in 2014. Click here.
Click here to get exclusive access to the 7 Best Stocks to own in 2014.
Members log in:
Not a member yet? Sign up here or learn more.
Chief Investment Strategist
33-year seasoned market analyst and professional trader with highly accurate track record. Specialty in global markets.
Global Energy Strategist
35-year expert in oil and gas policy, risk assessment, and emerging market economic development.
Capital Wave Strategist
30-year CBOE trader, market maker, and retired hedge fund honcho. Helped launch the Volatility Index in 1993.
20-year commodity guru and portfolio advisor. Top authority on metals + mining stocks. Head- quartered in Canada.
Defense + Tech Specialist
30-year veteran of tech markets with a Rolodex of Silicon Valley CEOs. Pulitzer nominee. Uncovered rare earths crisis.
30-year veteran analyst of business, economics, and financial markets. Award-winning author of "Contrarian Investing."
If you're wondering how the debt ceiling debate will affect gold prices, you need to check out a new report from Goldman Sachs Group Inc. (NYSE: GS).
Investment powerhouse Goldman believes gold prices will log impressive gains over the next three months as the debt ceiling debate takes center stage on Capitol Hill. The bank is advising investors to position portfolios ahead of upward moves in the precious metal.
"We see current prices as a good entry point to re-establish fresh longs," Goldman analysts Damien Courvalin and Alec Phillips wrote in a Jan. 18 report.
The bank reaffirmed its three-month price target for gold of $1,825 an ounce. (Gold was trading at $1,695.20 in New York Tuesday.)
"The uncertainty associated with these (debt-ceiling) issues, combined with our economists' forecast for weak U.S. GDP growth in the first half of 2013 following the negative impact of higher taxes, will push gold" to the three-month target, the report stated.
The Goldman strategists pointed out six instances between 1996 and 2007 when the country hit the debt ceiling and the Treasury responded by using its muscle to execute "extraordinary measures" to keep the country afloat and running.
Gold prices rallied some 10% in half of these instances in the month prior to the debt-limit increase.
The commodity enjoyed unprecedented robust momentum during the last debt standoff in 2011, which continued for several weeks amid heated negotiations. During that span, the yellow metal set a series of record highs, causing a gargantuan gold-rush frenzy not seen since prospecting days.
The bullish view on gold is shared by bullion bank ScotiaMocatta, as reflected in its January Metal Matters Monthly.
"The financial system is drowning in debt and there seems no end in sight to ongoing massive budget deficits," the bank wrote. "Confidence in the financial system and in the fiat government paper that facilitates it will remain low."
Nic Brown of France's bullion bank Natixis is also bullish on gold prices and recently told Reuters, "If there was a reason for buying gold, you've got two good ones." He cited February's Chinese New Year, a celebratory time trendy for gifting gold, and the coming U.S. debt-ceiling showdown.
"We're surprised at how low gold prices are," Brown added.
Market participants have a bevy of options when considering gold investments that will soar as debt ceiling debates continue. Three popular choices include: