why gold will rise further

  1. 9,081 Posts.
    James Turk is spot on (imho)


    SAN FRANCISCO (CBS.MW) - A funny thing happened on the way to the gold
    rally: one analyst issued specific, month-by-month forecasts that thus
    far are hitting the mark.

    The spot gold price Tuesday morning rose $5.20 to $376 an ounce, its
    best since November 1996. The gain earned the precious metal a 9 percent
    return since Jan. 2, when gold stood at $345 an ounce.

    Nearly all bullion analysts, on Wall Street and Main Street, link
    gold's continuing rally to tensions in the Middle East and in North
    Korea. For his part, James Turk is convinced the talk of war in Iraq, or
    a nuclear showdown in Asia, have little to do with gold's 25 percent
    gain in 2002 and the metal's current gains.

    The longtime editor of New Hampshire-based Freemarket Gold & Money
    Report (http://www.fgmr.com/) instead points to monetary metrics that
    compare the ascent of gold, or its decline in the 1990s, to government
    budget spending trends and the supply of paper money flooding the globe.

    On Tuesday, for instance, Russia, joining China and several other
    countries in a shift toward bullion-linked reserves, said its central
    bank will boost gold and foreign-currency holdings to $55 billion by
    year's end, a rise of 17 percent.


    Following up his early January forecast
    that the gold price would surpass $370 an ounce in the coming weeks,
    Turk on Tuesday told me he expects the metal's price to reach $434 an
    ounce by the end of February, less than four weeks' time. Such a gain,
    15 percent at current levels, would hearken back to the middle of
    February 1996, when the metal peaked at $415 an ounce before beginning a
    5 1/2-year slide into the dungeon.

    The researcher's predictions, bold in their specific timing and price
    level, depart from those found at investment banks in London and on Wall
    Street, where analysts are reluctant to forecast an average gold price
    higher than $360 an ounce or so for all of 2003. Turk is confident gold,
    logging inevitable gains as international investors flee the "dollar
    bubble," will reach $600 this summer and surpass $900 an ounce by
    February 2004.
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