“Gold will get to $5,000 – it’s eighth-grade math,” market analyst says

“I am saying gold will get to $5,000 – it’s eighth-grade math,” declares market analyst Jim Rickards of Omnis Inc. in an appearance on CNBC’s “Squawk Box” along with George Dowd of Newedge Inc. “Just look at the amount of gold and the amount of paper money. Do the division. That’s where gold has to get to.”

“Bullion is trading at a 7-month high and for good reason”

David Rosenberg with Bank of America said in February 2010 “As we have said time and again, we like gold because it is a hedge against global instability; it is a hedge against deflation since that condition triggers financial market setbacks and it is inversely correlated to global short-term interest rates and there is a race right now towards 0%. Bullion is trading at a 7-month high and for good reason: it’s called supply and demand. Production is down 4% YoY while fiat currencies globally are being created at a double digit rate by the world’s central banks, and we see that according to the World Gold Council, even with recession in India, gold demand soared 26% YoY in the fourth quarter.”

Gold Could More Than Quadruple By 2012

Robert McEwen, chairman of U.S. Gold Corp. says gold prices will more than quadruple to $5,000 by 2012. He says investors will reallocate capital to real money as the dollar loses its viability and money printing causes money to move into gold.

The world governments are buying record amounts of gold

Central banks continue to reshape the very structure of the gold market by actively amassing gold reserves. Like China before it, Saudi Arabia became the latest nation last week to reveal effectively clandestine purchases of gold by “restating” its hoard by 125% from 143 tonnes to 323 tonnes. This increase is nearly as large as India’s 200-tonne purchase of gold last October that helped spark another major breakout in gold prices. Alongside purchases by Russia, the Philippines, and others, sovereign purchases have emerged as a powerful force in the surprisingly small-scale global market for physical gold.

Whether you believe the experts or not, one important point that nobody can dispute… the US government is printing trillions of dollars in an attempt to pay off deficits. Any person with a rational mind understands that this will cause inflation or even hyper inflation. Gold always rises in value when the dollar becomes weaker. And investors are protecting themselves against the dollar weakening. Investing in gold is not speculation these days. It is the best way to preserve your wealth.

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