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Gold’s Long March Upward Continues

Despite gold's recent run up to new historic highs, I believe the yellow metal's price has far to go - both in future percentage appreciation and duration before the great gold bull market comes to its ultimate cyclical end. Right now, there is no evidence of a buying frenzy to suggest we are anywhere near a long-term top . . . but there are plenty of rock-solid fundamentals that suggest the market is healthy with plenty of room to move higher.  Moreover, the world economic and geopolitical environment remains very supportive - and seems likely to remain pro-gold for years to come. My ...

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Global Inflation Rising and Other Pro-Gold Developments

Clients and readers of NicholsOnGold.com should not be surprised by gold's recent rebound. In late January, as gold was testing recent lows near $1,310 an ounce, we said "the fundamentals suggest much higher prices ahead" with "market activity strengthening the case for a surprisingly sharp snapback and new all-time highs later this year." Indeed, we anticipate gold will retake its all-time high near $1,432 an ounce in the months ahead . . . and reach $1,700 later this year . . . on its way to $2,000 an ounce in 2012 . . . and still higher prices in the next few years. (Readers ...

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Looking for a Snap Back

January has been a difficult month for gold, so much so that many market mavens - analysts and investors alike - are abandoning their bullish expectations. From its year-end 2010 price near $1,420 an ounce to its recent low just over $1,320 gold has so far shed some $100 - about seven percent.  Measured from its all-time high just over $1,432 in early December, the recent decline is less than eight percent.  Either way, in percentage terms, this doesn't amount to much of a correction in the metal's 10-year old bull market. Bright Fortunes In contrast to gold's naysayers and born-again ...

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GOLD 2011: Another Banner Year

Gold began the new millennium under $300 an ounce . . . and under a cloud of pessimism among even many of its most ardent advocates.  To mainstream investors and central bankers around the world, its two-decade decline (from 1980's all-time high near $875) confirmed the yellow metal was no more than a "barbarous relic." What a difference a decade makes!  Ten years later, gold had advanced to more than $1000 an ounce - to $1087.50 basis the December 30, 2009 London PM fix - for a gain of roughly 275 percent over the ten-year period. Gold - By the Numbers Gold's steep ascent continued in ...

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Gold and the Economy: Don’t Be Fooled

After reaching a new record high of $1,430.95 last Tuesday, December 7th, gold fell back quite precipitously, mostly on profit taking by institutional traders and speculators in "paper" derivative markets.  By week's end, the metal traded as low as $1,372 to register a loss of nearly $60, about four percent, from the all-time high. Economic news in the United States (of improving cyclical indicators and initial reactions to the President's deal with Congressional Republicans on tax policy and unemployment benefits), in Europe (of some agreement within the Eurozone on funding Irish debt), ...

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U.S. POLITICS, ECONOMIC POLICY, AND THE FUTURE PRICE OF GOLD

Gold thrives on political and economic uncertainty . . . and we've got plenty of that now that the Republican Party has seized control of the House of Representatives and narrowed the Democratic majority in the Senate.  What's more, the U.S. Federal Reserve, America's central bank, is adding to the uncertain political and economic landscape as it embarks on another large dose of monetary stimulus. Without a doubt, the new arithmetic on Capitol Hill -- along with the Fed's recent policy shift -- reinforces the bullish case for gold and raises my confidence that gold prices will rise to $2000 ...

U.S. Elections, Economic-Policy Prospects, and the Price of Gold

America's Congress is up for grabs in just a few days -- and world financial markets have a serious case of the jitters. No one knows for sure what the make-up of the U.S. House of Representatives and the U.S. Senate will be next year . . . but it's hard to imagine we won't be faced with more gridlock and more acrimony on Capitol Hill -- in short, a dysfunctional government that is incapable of dealing effectively with America's serious economic problems. With the liberal Obama Administration and a more conservative Congress at loggerheads, it is likely that America's central bank will, by ...

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Monetary Policy, Competitive Devaluation, Inflation Targeting . . . and the Future Price of Gold

Suddenly, our long-standing forecast of $1500 gold -- possibly by the end of this year -- doesn't seem so far-fetched . . . and, one by one, many economists, analysts, and investors are ratcheting up their price targets to keep pace with the market. The U.S. dollar price of gold is now up more than 20 percent this year and looks certain to score its tenth consecutive annual increase in a decade.  By comparison, U.S. equities, measured by the Dow Jones Industrial Average or the S&P 500, are up a meager four-to-five percent year to date. No Bubble Here Notably, the yellow metal's recent ...

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GOLD: Summer Consolidatation — Bull Market Alive and Well

Gold prices have fallen sharply in recent weeks from their all-time high over $1265 on June 21st in New York.  By mid-July, gold was briefly below $1180 -- a drop of some seven percent. Faint-hearted gold investors need to remember that bull markets never move straight up.  When they do, it's called a "bubble" . . . and bubbles do burst. Instead, this market is moving up -- and will continue to move up -- in a stepwise pattern with occasional high volatility and big corrections on the road to much, much higher prices in the months and years to come. For the most part, this summer's ...

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Gold and the Double Dip

Many business economists and financial journalists are again talking about a "double dip" or renewed downturn in U.S. business activity.  As our clients and readers of this website know, we've long held the view that the U.S. economy would sink back into recession or, at best, a long period of sluggish growth insufficient to produce any meaningful gains in employment. Longer term, we see years of "stagflation" for the United States and European economies -- with sub-par economic growth, unacceptably high unemployment, and a troubling rise in inflation led by higher prices for many ...

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