So asks Sara Nunnally (www.insideinvestingdaily.com) in edited excerpts from her original article*.
Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com (A site for sore eyes and inquisitive minds) and www.munKNEE.com (Your Key to Making Money!) has edited ([ ]), abridged (…) and reformatted (some sub-titles and bold/italics emphases) the article below for the sake of clarity and brevity to ensure a fast and easy read. The article’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article. Please note that this paragraph must be included in any article re-posting to avoid copyright infringement.
Nunnally goes on to say, on part:
Governments…[bought] five times more…gold bullion in 2011 than in 2010…[and] now have more than 30,788.9 metric tons…in [their] vaults – and… [it is anticipated that they will] buy another 190 metric tons (more than 6.7 million [troy] ounces) is in the first half of 2012. At yesterday’s opening spot price for gold, that means governments could spend $11.56 billion on gold in the next six months. That’s $64.2 million a day, every day until the end of June![It is the] emerging markets who have been buying gold:
- Turkey added 63 metric tons of gold between October and November 2011
- Thailand bought 52.9 metric tons in 2011
- South Korea bought 40 metric tons, and
- Russia bought 65.2 metric tons
- China bought 85 metric tons in October with an estimated 100 tonnes in November
Together these countries make up more than half of all the gold buying in 2011. That is a huge statistic. Think about this for a second. If Thailand [bought] all that gold on the spot market today, it would spend $3.22 billion, or nearly 15% of its entire GDP growth in 2011…
Meanwhile developed economies have been selling gold.
- Germany dumped almost 166,000 ounces last October and more than 169,000 ounces in 2010.
- France sold 56.7 metric tons of gold in 2009, worth at today’s price $3.45 billion.
I bet they wish they had that back now, eh?[The chart below] is gold’s spot price over the past 30 days…The low on Dec. 29, 2011, was gold’s lowest point in six months, and represented a drop of more than 19% from its record price above $1,900 an ounce. [Why?] Because everybody was selling gold – [people such as] billionaire hedge fund manager John Paulson [who] dumped one-third of his holdings in GLD last fall [even though] he had been calling for gold at $4,000 back in May 2011, when George Soros sold his gold holdings – and [all] that weight led to investors turning a blind eye to gold in this first month of 2012.
Now, [however,] big names are swaying bullish for gold this year. Morgan Stanley thinks gold will average $1,845 an ounce in 2012, while Goldman Sachs thinks gold will hit a new record of $1,940 this year. [Then there those who think gold will go dramatically higher in 2012 – read These 8 Analysts See Gold Going to $3,000 – $10,000 in 2012! Here’s Why]
According to Morgan Stanley gold could see $2,175 in 2013 [and many others see gold going even higher than that as per these articles: $10,000 Gold is Coming in 2012/13! Here’s Why and Contracting Fibonacci Spiral Puts Gold Near $4,000 by 2013 and $7-10,000 by 2020 and New Analysis Suggests a Parabolic Rise in Price of Gold to $4,380/ozt.]
There are plenty of reasons why gold is going to be a major investment again in 2012, and emerging markets, particularly China, are going to play a big part in that. China bought 454 metric tons between 2003 and 2009 and one analyst is projecting China’s total gold imports for 2011 [to exceed that] at 490 metric tons — more than all the gold the world’s central banks added for the entire year last year! [Indeed, according to Eric Sprott – Aggressive Chinese Buying Will Spike Gold Price]
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We’ll know soon enough but how [should we] to play it? [May I suggest you read this article for some insights on how to do just that: There is a MUCH Better Way to Own Gold Than Via ETFs and ETRs – Here’s How]
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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. Of more immediate interest, however, is that 8 of those individuals believe gold will reach its parabolic peak price in the next 12 months – even as early as February, 2012. This article identifies those 8 and outlines their rationale for reaching their individual price expectations. Words:1450
Short-term volatile moves in Gold, as we have seen over the past few months, do not affect our projections for the future price of Gold based on our fractal (pattern) “model” off the late 70′s Gold Bull. Just as we correctly projected the $1,920 high in our April article entitled Goldrunner: Gold on track to Reach $1860 to $,920 by Mid-year (gold reached $1,917.20 in late August and $1,923.70 in early September, 2011), our current analysis indicates that Gold will enter a range between $3,000 and $3,500 by mid-year 2012. Words: 975
I am increasingly confident that the consequences of fragile sovereign debt, precious metals market manipulation, insufficient physical supply, and the need for a safe haven investment refuge, will contribute to rampant price inflation and drive precious metals bullion and mining stock to a parabolic peak price of $10,000 sometime in 2012 or 2013 at the […]
Gold is operating on a smaller Contracting Fibonacci Spiral Cycle that is in synch with the larger Contracting Fibonacci Spiral the markets are in. Adding together the sum of parts… the price of gold will move up in price in 2013, 2016, 2018, 2019 and 2020, with each subsequent leg moving less in percentage terms than the prior move. Gold advanced 4 foldish from 1999 until 2008 ($252/ounce to $1046/ounce) suggesting that gold should top out below $4000/troy ounce by the end of January, 2013…[on its way] to $7,000 and $10,000 per troy ounce by 2020. [Let me explain.] Words: 834
According to my 2000 calculations, if interest rates and inflation stay constant over the next 2 years, we could expect to see (with 95.2% certainty) a parabolic peak price for gold of $4,380 per troy ounce by then! Let me explain what assumptions I made and the methods I undertook to arrive at that number and you can decide just how realistic it is. Words: 740
Late last year the Royal Canadian Mint intoduced an Exchange Traded Receipt (ETR) in another long line of paper-gold investments that are now trading on securities exchanges worldwide. It, like all of the other programs, comes with a slew of fees and risks. [Why not take personal physical possession of your gold or silver, store it in an allocated and secure non-government vault, be able to have any or all of it shipped to you immediately upon request – and for dramatically less than any ETF or ETR? Let me explain how easily it is to do just that.] Words: 1601