Sunday, November 30, 2008

Citigroup Says Gold Could Rise Above $2,000 Next Year As World Unravels

An employee of Tanaka Kikinzoku Jewelry K.K. displays a gold bar
at the company's store in Tokyo. Photo: Reuters

From The Telegraph:

Gold is poised for a dramatic surge and could blast through $2,000 an ounce by the end of next year as central banks flood the world's monetary system with liquidity, according to an internal client note from the US bank Citigroup.

The bank said the damage caused by the financial excesses of the last quarter century was forcing the world's authorities to take steps that had never been tried before.

This gamble was likely to end in one of two extreme ways: with either a resurgence of inflation; or a downward spiral into depression, civil disorder, and possibly wars. Both outcomes will cause a rush for gold.

"They are throwing the kitchen sink at this," said Tom Fitzpatrick, the bank's chief technical strategist.

"The world is not going back to normal after the magnitude of what they have done. When the dust settles this will either work, and the money they have pushed into the system will feed though into an inflation shock.

Read more ....

My Comment: A blunt assessment .... one which I cannot disagree with. Our political establishments have failed us .... the only thing that we can do now is protect ourselves (in the event of the worse case scenario).

No comments: