I am not predicting a future price of gold or the date that gold will trade at $4,000 says GE Christenson, but I am making a projection based on rational analysis that indicates a likely time period for gold to trade at $4,000 per ounce. Yes, $4,000 gold is completely plausible if you assume the following:
* The US government will continue to spend in excess of $1 Trillion per year more than it collects in revenue, as it has done for the previous four years, and as the government budget projects for many more years.
* Our financial world continues on its current path of deficit spending, debt monetization, Quantitative Easing (QE), weaker currencies, war and welfare, ballooning debts, and business as usual.
* A massive and devastating financial and economic melt-down does NOT occur in the next four to six years. If such a melt-down occurs, the price of gold could skyrocket during hyperinflation or stagnate under a deflationary depression scenario. ...
* National debt is plotted on the left axis - yes, it was larger than $16 Trillion as of September 30, 2012. Gold is plotted on the right axis. The data covers an 11 year span from September 2001 through September 2012. This period includes the time after the stock market crash of 2000, the game-changing events of 9-11, the real estate crash, and the new bull market in commodities. Each month represents one data point. Note the similarity between the two trends. The statistical measure R-Squared for this 11 year period of monthly data is 0.969 - very high.
* This expansion in the national debt is a simple proxy for expansion of the money supply and the devaluation of the dollar. ...
Since gold correlates closely with national debt, we now have a clear, objective, and believable proxy (national debt) to model the future price of gold. Extend national debt and gold prices forward for the next five years based on the exponential increase from the last five years, and the result is the following table. Bracket gold prices, high and low, based on past annual volatility at about 15%. ...
As you can see, this projection for gold prices indicates that gold could reach $4,000 as early as September 2016, with a theoretical projected price of $4,000 in late 2016 or early 2017.
* The US government will continue to spend in excess of $1 Trillion per year more than it collects in revenue, as it has done for the previous four years, and as the government budget projects for many more years.
* Our financial world continues on its current path of deficit spending, debt monetization, Quantitative Easing (QE), weaker currencies, war and welfare, ballooning debts, and business as usual.
* A massive and devastating financial and economic melt-down does NOT occur in the next four to six years. If such a melt-down occurs, the price of gold could skyrocket during hyperinflation or stagnate under a deflationary depression scenario. ...
* National debt is plotted on the left axis - yes, it was larger than $16 Trillion as of September 30, 2012. Gold is plotted on the right axis. The data covers an 11 year span from September 2001 through September 2012. This period includes the time after the stock market crash of 2000, the game-changing events of 9-11, the real estate crash, and the new bull market in commodities. Each month represents one data point. Note the similarity between the two trends. The statistical measure R-Squared for this 11 year period of monthly data is 0.969 - very high.
* This expansion in the national debt is a simple proxy for expansion of the money supply and the devaluation of the dollar. ...
Since gold correlates closely with national debt, we now have a clear, objective, and believable proxy (national debt) to model the future price of gold. Extend national debt and gold prices forward for the next five years based on the exponential increase from the last five years, and the result is the following table. Bracket gold prices, high and low, based on past annual volatility at about 15%. ...
As you can see, this projection for gold prices indicates that gold could reach $4,000 as early as September 2016, with a theoretical projected price of $4,000 in late 2016 or early 2017.
More information can be found online at http://www.goldbullionadvisors.com
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