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IPMI Speech

Gold Situation and Outlook Presentation to the International Precious Metals Institute I've been asked to talk about one of my favorite subjects: Gold . . . or, more precisely, the global market for the metal and the factors likely to influence its future price.  In fact, gold is a subject on which I could talk for hours . . . but I've been asked to keep my presentation somewhat shorter - so I'll try to give you some highlights and conclusions. My comments today will be posted on my website - NicholsOnGold.com - so, if you're interested you can easily check back to review my analysis and ...

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GOLD — A NEW MONETARY ROLE?

China and Russia are agitating for a demotion of the dollar in the world monetary system with a new “super-sovereign” basket of currencies, possibly even including gold as the Russian’s have suggested, gaining stature as the new lynchpin. Though such talk may hearten the advocates of gold, the possibility of any sudden change in the world monetary system seems remote, if only because no alternative can provide the, necessarily very large and very liquid capital markets necessary to accommodate reinvestment of reserve assets now held in U.S. dollars. And, for all their talk, the Chinese, ...

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FED EASING AND GOLD PROSPECTS

This week's news from the U.S. Federal Reserve promising massive quantitative easing in the months ahead greatly increases our confidence in the long-term bullish outlook for gold and silver.  Since the first recorded use of currency by King Croesus some 2,500 years ago, there has NEVER been a rapid increase in the supply of money that has not, within a few years, been followed by an acceleration of inflation.  Why should the current experience be any different!! Our forecast that gold will reach a cyclical high over $2500 and silver will exceed $50 an ounce in the next few years looks ...

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GOLD: STILL VULNERABLE

Gold's tumble in recent days, now about 9.5 percent from its late-February high just briefly over $1000 an ounce, is no surprise to readers of NicholsOnGold.com.  Although we remain bullish for the long-term and foresee more than a doubling of the gold price in the next few years, the immediate picture is less rosy . . . and the yellow metal remains vulnerable to further short-term selling. A number of factors have contributed to gold's decline in the past week and may remain influential in the weeks ahead: •    First and foremost, the market has had to absorb an absolutely fantastic ...

NO SURPRISES

Gold's retreat in recent days from its brief flirtation last week over $1000 an ounce was no surprise.  We warned in recent posts that the surge in secondary supply, particularly from Asian and Mideastern markets, and the worldwide collapse of fabrication demand left the price vulnerable -- and an easing of investor interest could bring a sizable correction in the yellow metal's price. Moreover, when everyone seems to be jumping on the gold train, nary a bear is to be seen, bulls are uniformly revising upward their price forecasts, and the financial press suddenly gets all hot and bothered, ...

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Bipolar Gold

With the price of gold lurching first one way then the other, it looks like the market has been suffering from bipolar disorder.  I expect this split-personality behavior, characterized by extreme price volatility, to continue for some time to come with big swings up and down -- but, importantly, around a rising trend with support levels moving up step-wise over time. In short, gold is heading much higher, but not without more struggle and occasional disappointment for those looking for a speedy ascent.  Further out -- over the next year or two -- I have no doubt that gold will move to new ...

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The World Economic Crisis and the Outlook for Gold

The World Economic Crisis and the Outlook for Gold Speech to the 3rd Annual China Gold & Precious Metals Summit Shanghai, China Thank you Mr. Chairman for that flattering introduction and thank you to the conference organizers who have made it possible for us to exchange information and insights into the future of gold here in China and in the global marketplace. You should know that my presentation today will be posted on my website, NicholsOnGold.com, so you can easily check back in a few days, or a month, or a year – to review my analysis and my expectations for gold. A few ...

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GOLD: Seeing Past the Sell-Off

Gold has fallen more than $300 – about 30% – from its all-time high of US$1034 last March to its recent lows near $720.  And, since the beginning of the year, it is off about 12% – not too bad compared to most other asset classes.  Looking at the decline of the past week, most analysts are saying that gold has been pulled down by the drop in oil, the strong U.S. dollar, and an easing of inflation expectations. But, in my view, gold’s latest swift decent is a direct consequence of the unfolding global economic situation, the playing out of the credit crisis, and the onset of recession.  The ...

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