The outlook for GOLD

Oil was supposed to go well above $150. Some major players were predicting $200, up, up and away! Now it is standing at $40.

The same forecasting game is now played by those who benefit the most from rising gold prices. Sign of a top?

This graph of gold and inflation (click on graph to enlarge) shows inflation (CPI) and gold on an index basis so that you can compare the appreciation of gold relative to consumer prices.

In 1980, gold moved considerably higher than the inflation index and gold did not do much for 30 years from those levels.

In 1998-2000, gold fell well below the inflation index and gold soared above the 1980 levels (barely).

Now, gold prices jumped well above the price index. With so many people (I do not want to call them investors) forecasting much higher gold prices ($1200-$2000) and consumer prices declining, has gold reached a multi year top?

I will be happy to speak to your investment group on how the business cycle impacts investment strategies and the choice of asset classes.

To find out more about my in depth view of the markets and my strategy just visit our website https://www.peterdag.com/. You can review The Peter Dag Portfolio, free of charge of course. You can also call me at 1-800-833-2782 to discuss your specific money management needs.

George Dagnino, PhD
Editor, The Peter Dag Portfolio
Since 1977