|James Turk and John Rubino are well known figures in the gold industry and they’ve just published a new book, ‘The Money Bubble’ in which they argue that the price of gold is about to soar to $10-12,000 an ounce. Here’s why.
The above introductory comments are edited excerpts from 2 articles* on gold and silver by Peter Cooper (arabianmoney.net) entitled Why James Turk and John Rubino say the price of gold is set to soar to $10-12,000 an ounce and $500 an ounce silver when gold makes its epic run predicts new book, respectively.
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Cooper goes on to say in further edited excerpts:
In a nutshell the authors contend that the major paper currencies of the world actually now have less gold backing them than previously thought. An analysis by the Gold Anti-Trust Action Committee concluded that nearly half the world’s gold reserves of 29,000 tonnes have been dumped on the open market through central bank leasing or lending as they term it.
$10-12,000 an ounce
You can calculate what the price of gold needs to be to restore gold backing to paper currencies to solve a crisis of confidence in several different ways. This is where the future price of $10,000 to $12,000 per ounce is derived. The formulas given in the book are a bit complex but the price implications are easy enough to follow.
The authors blame the ‘gold price smackdown’ of last April on:
Messrs. Turk and Rubino describe how:
Short squeeze coming
‘…a short squeeze (a counterparty default that sends the price dramatically higher) has not become just possible, but probable, in the next few years’ because:
…[Once the above happens] all it takes is for the pension funds of the world to discover gold and the price is off to the levels James Turk and John Rubino expect ($10,000-12,000/ozt.)….
The real issue for silver is the ratio of available silver to gold of 3:1 when the price ratio is currently 65:1. If there is ever a rush to buy silver there is just not going to be enough in stock and that will send the price higher and bring its price ratio to gold tumbling back towards its much lower historic levels. Silver will return to ’something close to its historical ratio to gold’ and pass $500 an ounce when gold…[reaches] $10,000-plus.
Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.
*http://www.arabianmoney.net/gold-silver/2014/06/09/why-james-turk-and-john-rubino-say-the-price-of-gold-is-set-to-soar-to-10-12000-an-ounce/ and http://www.arabianmoney.net/gold-silver/2014/06/06/500-an-ounce-silver-when-gold-makes-its-epic-run-predicts-new-book/ (Copyright Peter Cooper 2014) Sign up for our free newsletter.
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