CRITICAL FACTOR: The Real Reason To Own Gold

Currently, stocks, bonds and paper assets are on the receiving end of this monetary stimulation, while the physical assets such as the precious metals & commodities have been beaten down to assist in lowering the already low manipulated inflation rate.

Investors who once thought the precious metals were a safe store of value, are now beginning to question their confidence in gold as the price continues to head down towards its low set in June.   This is precisely what the fiat monetary authorities planned for and the public has taken it…. HOOK, LINE & SINKER.

There seems to be no shortage of gold forecasts.  David Einhorn was on CNBC and stated:

“certain aspects of the market are very much in bubble,”  with investors “dismissing valuation metrics.” “The market is confused,” between useful products and real profit streams, he suggests for a number of headline-grabbing highly speculative names.

“Fed policy is a headwind to the economy,” as he quantifies the hundreds of billions in lost interest income relative to wealth gains. Owning gold makes sense, he adds, “in case they lose control.”

Here, Einhorn believes the reason to own gold is just in case “THEY” lose control.  In all actuality, I believe THEY HAVE LOST CONTROL, however  the world doesn’t realize it yet.  Einhorn gets an “A” for effort here, but fails to understand the critical underlying reason to own gold.

Another long-term forecast of the price of gold was put out by Edison Investment Research November Gold Report.  In the report they forecast gold to hit $1,642 in 2015 and reach $2,070 by 2020.  This may seem a great deal better than some of the other more bearish bank and brokerage forecasts such as Goldman Sachs who see gold falling to $1,050 by the end of next year.

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