Financial Analyst Rickards Predicts at least $10,000 for Gold

James Rickards, well-known financial commentator and author of the New York Times best seller Currency Wars: The Making of the Next Global Crisis, and The New Case for Gold, has repeated several times in televised interviews that gold could soon skyrocket to $10,000 an ounce.
 
While this seems like a stupendous climb for the shiny metal, we need to appreciate Rickards’s reasoning about that possibility. Central banks have tried everything to stimulate the world’s contracting economies. Prestigious central banks, including the European Central Bank and the Bank of Japan, and others, have tried several rounds of quantitative easing, and the trimming of interest rates to record lows.
 
And now there’s even talk central banks will buy perpetual bonds – in other words, bonds they can hold on their books forever. Clearly, they’re desperate at their failure to be able to stimulate inflation. Economies can’t grow unless they undergo at least some inflation. Businesses won’t invest or expand payrolls unless they can see some return for their investments.
 
In a flat economy with absolutely no inflation, businesses won’t see any returns. Central banks will keep trying though, because a sustained deflationary economy can only increase the value of real debt on their books.
 
True economic growth can only ultimately come through increased investment by businesses and stepped-up consumer spending. If central banks keep printing money, their efforts can only result in the debasement of fiat currency. When that happens, consumers and investors will gravitate toward gold.
 
This is especially true, because low interest rates reduce the opportunity cost for investors to buy gold. Traditionally, interest-bearing instruments are considered gold’s competition for investor funds.
 
It’s all too easy to dismiss Rickard’s $10,000 prediction for the price of gold. But, as he points out, noted investors like George Soros, Stanley Druckenmiller, John Paulson, and David Einhorn have already stepped up to the plate.
 
Rickards also thinks of gold as being more money than commodity. In that sense, it reflects the world’s lack of confidence in the dollar. Because every time the dollar goes down, the price of gold goes up.
He feels, then, two major scenarios are required for the debasement of fiat currency. The first scenario is the non-stop printing of money. As more and more paper money rolls off the presses, the less value it has. Like anything else, when an item is plentiful, it is worth less.
 
The second scenario required for the debasement of the dollar, and other fiat currencies, is for the velocity of money to accelerate. If someone holds a lot of dollars, for instance, and keeps spending or dumping them, so to speak, those dollars will decrease in value. When one lacks confidence paper money will hold its value, he’ll want to get rid of it in return for tangible assets as fast as he can.
 
Doesn’t it make sense for you to secure your own retirement funds with an investment in physical gold while the price remains attractive, and before the crowds begin lining up at the door?
 
For more information, call 800-777-6177 now, and ask to speak to a Fortress Gold Group representative.

This entry was posted in Economy, Gold, IRA & 401-K Accounts, Money, Physical Gold, Precious Metals, Precious Metals News, Silver. Bookmark the permalink.

Comments are closed.