From this morning’s piece by David Rosenberg. The long time gold bull still thinks the yellow metal’s bull market is alive and that prices are headed to $3,000:
“Indeed, the yellow metal is trading less and less like a commodity over time and more like a currency – a currency that is no government’s liability and where no central bank has a printing press.
The Bank of Japan just announced how it has been engaging in “stealth intervention” to weaken the Yen. The Europeans desperately need a soft Euro to have exports act as an antidote from escalating fiscal drag. Of course, we saw the Swiss last year throw in the towel on accepting a strong Franc. In the emerging markets world, there has been no shortage of market-meddling initiatives to soften their currencies. And in the US, part of the White House drive to bring jobs home – how mercantilist can this be? – necessarily involves sanctioning a “more competitive” currency.
Now we have central banks continuously priming the monetary pumps as well. If we adhere to Bob Farrell’s Rule #! and then look at what that is going to mean with respect to the ratio of gold price to global currency in circulation, getting to $3,000 before the bull market in bullion busts is, in our opinion, quite easily attainable.”
Source: Gluskin Sheff
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.