Korelin Economics Report

Gold, A Forty Year Perspective, by Gary Christenson

In broad terms, gold was in a bull market during the late 1960s and 70s, a bear market during the 80s and 90s, and back in a bull market since 2001. The important questions are:

 

or

My answer is: Gold peaked in 2011, bottomed in June and December of 2013, and should rally for several, and probably many, years into the future.

Why?

Examine the following graph of weekly gold prices since 1977 and the 144 week simple moving average shown in red. The uptrend since 2001 is clear and pronounced. The correction since 2011 is unmistakable.

Click on image to enlarge.

 

 

Worthy of note from the spreadsheet (not shown) are:

 

 

What could push the price of gold LOWER?

 

 

 

What will push the price of gold higher?

 

 

 

 

 

 

 

 

I could go on, but the situation is clear. Gold did NOT blow-off into a bubble high in 2011, all the drivers for continued higher gold prices are still valid, demand is huge, supply will be restricted when the western central banks run out of gold or choose to terminate “leasing” into the market, and government expenses, “money printing” and bond monetization are out of control and accelerating.

Gold prices will climb a wall of worry in the years ahead.

You may be interested in my comments on Silver and 2011.

GE Christenson
aka Deviant Investor

 

 

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