Propelled by inflation that doesn’t appear to be getting any better, the precious metals are lifting off. From Egon von Greyerz at vongreyerzgold.com:
The desire of gold is not for gold. It is for the means of freedom and benefit.
Ralph Waldo Emerson
Gold is now in a hurry and silver even more so.
The price moves in the coming months and year are likely to be spectacular. The combination of technical and fundamental factors can easily drive gold well above $3,000 and silver to new highs above $50.
Forecasting gold is a mug’s game, as I have often stated.
But that is in the short term.
In the medium to long term, forecasting the Gold price is a cinch.
How can I be so certain?
Well, since the history of gold and money began, gold has always increased in value measured against fiat money.
Voltaire gave us the formula in 1729 when he said:
PAPER MONEY EVENTUALLY RETURNS TO ITS INTRINSIC VALUE – ZERO
So why has no investor or layman ever heeded the simple fact that –
ALL CURRENCIES HAVE WITHOUT FAIL GONE TO ZERO.
What most people, including experienced investors, don’t understand is that gold doesn’t increase in value.
Gold just maintains stable purchasing power. A Roman toga 2000 years ago cost 1 ounce of gold and a tailored suit today also costs 1 ounce of gold.
So it is really totally wrong to talk about gold going up when it is the unit we measure gold in that goes down. Just as all fiat money has done.
