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This page archives the October 2009 links to gold articles featured in our popular NewsGroup e-mail service.

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Jump right in... amid this week's report, ScotiaMocatta, the precious metals division of the Bank of Nova Scotia calls for gold to reach as high as $1,400 by next year; another forecaster calls for $2,500 gold, all without any help from inflation. But, "When?" you surely ask? Why, before the end of this report, of course!

Gold gives a precious insight into economy
By Tom Stevenson, Telegraph.co.uk; October 24, 2009

What a strange and fascinating commodity gold is -- a store of value that is no one's liability, which cannot be printed or debauched by governments but which, with no income stream, has no objective value. A simultaneous hedge against both deflationary slump and inflationary spiral, it is little wonder gold should be the investment of choice...

Some serious people think that the recent rally in the gold price really is different this time. It's not like the safe-haven spikes that have pushed the yellow metal through $1,000 an ounce on a handful of recent occasions but each time failed to hold the gain... If gold is telling us anything today it is that governments -- principally America's and our own [UK] -- are about to make a mess of the exit from their economic stimulus programmes. Either they are going to tighten too soon, plunging the world into a deflationary ice age, or, more likely, they are going to hang back too long until we are swept away by hyperinflation.

The only honest way out is the slow grind of tax hikes and spending cuts but anything that is remotely acceptable politically will be totally inadequate fiscally... Printing money remains the time-honoured way out -- and it will end as messily as it always has. Hard assets, the king of which is gold, and the shares of companies that produce them are a must for anyone looking to survive this institutionalised generational theft.

USAGOLD Comment: Wow, the Telegraph pulled no punches -- let's hurry on to the next article before some of that bleeding mess gets onto our shoes.

'Disorderly decline' of dollar cannot be ruled out
By Matthew Brown, Bloomberg; October 22, 2009

An orderly dollar decline is the "most likely scenario," Richard Clarida, a global strategic adviser at Pimco, wrote in a note to clients today. "A disorderly decline, while unlikely, cannot be ruled out."

...A collapse in the value of the dollar would jeopardize its status as the world's reserve currency, Pimco said. If the dollar loses that "privilege," U.S. companies may have to issue debt in foreign currencies and risk losing money as the dollar weakens, Clarida said.

USAGOLD Comment: The analysts at PIMCO have an established reputation, in my view at least, of speaking a bit more frankly than many of their financial peers especially when addressing the potentially gloomy side of economic affairs, and their comments tend to carry a bit more weight, too; as of midyear 2009, PIMCO had $840 billion under management, including the world's largest bond fund. And it's hard to claim that PIMPCO is somehow simply "talking their book" because any further decline in the dollar, disorderly or not, certainly wouldn't likely bode well for holders of bonds in this current high-price, low-yield environment as there simply isn't enough yield in the outcome to make up for any significant purchasing power losses experienced by the dollar during the bond-holding period. So take that for what it's worth. ScotiaMocatta, meanwhile, feels that the stock market may be poised for a tumble, thus adding more shine to gold's appeal atop their reiteration here of the increasingly popular flight-from-paper-dollar theme...

Gold prices could hit $1,400/oz next year -- says Scotia
Reuters; October 22, 2009

ScotiaMocatta, the precious metals division of the Bank of Nova Scotia, said on Thursday gold prices could rise as high as $1,400 an ounce in 2010 as investors turn to the metal as a store of wealth...

"The fact U.S. dollar creditors are talking about the need for another global reserve currency shows that they are losing faith in the dollar," it said.

"We also have an uneasy feeling that after the near catastrophic events seen over the past 12 months, the sharp [stock market] recovery seen since March seems too good to be true, and for that reason it probably is." Any further signs of instability in the financial markets are likely to send gold prices considerably higher, it said.

The trend for governments to devalue their currencies is also denting faith in fiat -- or paper -- currencies and boosting the appeal of assets with intrinsic value, it added.

USAGOLD Comment: To be sure, intrinsic value only counts if you have at hand the thing itself, whereas a paper asset, derivative or IOU are all together or separately scarcely differentiable from the emptiness of the paper currencies that are driving investors to seek a reprieve.

What impact will the decline in paper currencies have on gold?
By Dylan Lobo & Ned Naylor-Leyland, Citywire; October 23, 2009

I was intrigued to come across the following quote on from Alan Greenspan on 9 September 2009: 'The rise in gold and silver is strictly a monetary phenomenon and is an indication of the very early stage of an endeavour to move away from paper currencies.' That the previous figurehead of the world's primary paper-money spigot, the Federal Reserve, would say such a thing in public is a surprising shot in the arm for gold... The unbacked paper merry-go-round is running out of gas and the implications are enormous...

There are many reasons for the recent change in sentiment in gold and silver, but the most important one centres on a fundamental change in Asian thinking about gold. It used to be difficult for Chinese citizens to buy gold or silver bullion; now there are myriad bullion dealers in China with the government recommending bullion-ownership on State TV... The Hong Kong government has also 'called' its gold reserves from London.

Little understood is the fact that many nations have allowed London and New York to custody their bullion reserves for decades. Once the issue of ownership of gold and silver that has been swapped, leased or loaned, really starts to become visible and newsworthy, the irredeemable currency crisis will be fully exposed.

Anyone who believes that each bar of gold held in Central Bank custodial vaults belongs, unrestrictedly, to just one careful owner, is naive in the extreme. An ownership spiders-web has been weaved through metals markets over the decades... the unravelling process will be highly complicated and is likely [to] focus attention on underlying ownership issues so far swept under the carpet.

USAGOLD Comment: There's an old adage about possession being nine-tenths of the law. But if it came down to it, as is suggested here, I'd venture that the value multiplier for hands-on physical ownership would count for far more than 9:1 when measured against a paper ounce amid a tangled network of unfulfillable contracts and distressed counterparty claims.

7 Reasons gold will surpass $2,500 -- and inflation isn't one of them
By Peter Krauth, Contributing Editor, Money Morning; October 21, 2009

Gold's price has quadrupled since 2000, yet this is just the beginning of a historic rise. Seven major forces are set to push gold past $2,500 -- and we're not talking about the tired old inflation story...

...with all the government bailouts and stimulus packages, it's hard to deny that inflation is coming. After all, the money supply has more than doubled since October. Yet few people realize that inflation may be the least of the reasons why gold prices will push higher. There are other forces at work here...

#1: Gold Mine Production is Decreasing...

#2: Gold is Getting Harder to Find. Miners are having difficulty replacing depleted resources.

#3: Investment Demand for Gold... in the first half of 2009 investment demand for gold is up 150% over the first half of 2008...

#4: Central Banks are Buying Gold... China has increased its reserves by a staggering 76%.

#5: Push for Gold-backed Currencies...

#6: Asian Demand for Gold is Exploding. Asia, with its more than two and a half billion people ... have a long-standing cultural affinity for gold as a store of wealth. For the last 50 years, until 2009, the Chinese government has forbidden its citizens from owning gold. But now China is encouraging its citizens...

#7: Gold is in a Secular Bull Market. A secular bull market typically last about 17 years...

USAGOLD Comment: And again, that list is not to say that inflation can't be among the full tale of reasons. In fact, the list could go on. If nothing else, consider the additional strain on the U.S. federal budget -- that is, on the current shortfall of tax revenue versus funding obligations -- now that the baby boomer demographic have begun to retire their considerable ranks from the taxpayer role while similarly beginning to draw upon their sorely anticipated share of Social Security, Medicare and Medicaid expenses. Uncle Sam's deficits are already chronic, and are hereby poised to worsen. This will likely exact a toll on sentiment in the market for government bonds while simultaneously propelling gold's unique esteem in the eyes of investors as the one internationally-respected asset that is immune to both sovereign default as well as sovereign overprinting.

A week ago gold touched a new high at $1,070 per ounce, and has since been hanging tough in the neighborhood, consolidating the latest price rally. Far from frothy, analysts are seeing this as a sober reaction to the unfolding tale of increasingly shabby international currencies and loose monetary policies...

Gold hits record above $1,070 an ounce
By Jan Harvey, Reuters; October 14, 2009

Gold rose to a record high above $1,070 an ounce on Wednesday as the dollar slid to 14-month lows against the euro and oil prices rose toward $75 a barrel, boosting interest in commodities as an asset class.

"As long as they keep selling the dollar there is no reason not to continue to buy gold, and that seems to have been the prevailing sentiment over the last few days," said Ole Hansen, senior manager at Saxo Bank.

USAGOLD Comment: And of course, the oft-asked question is...

Gold has shown its mettle, but how high can it go?
By Dave Carpenter, Associated Press; October 12, 2009

Gold's image may be changing as its price settles in above $1,000 an ounce and continues to set records. ... The price has tripled since 2003 and doubled since 2005, trouncing stocks this decade. The Standard & Poor's 500 index, a barometer of the stock market, is down 27 percent since 1999 while gold is up 266 percent...

Some gold-watchers predict a price of $2,000 or higher within the next few years. That's based on the scenario that rapidly rising U.S. government debt will lead to high inflation, sending more investors fleeing into gold to protect their dollars.

USAGOLD Comment: Frankly, the author misspoke -- rather than trying to "protect their dollars" these various investors are trying to preserve the value of their net worth by diversifying out of dollar holdings and into something else, preferably something substantially more solid. Says Jay Bryson, global economist at Wells Fargo, in a research note as cited in a MarketWatch article yesterday: ...foreign central banks, who've been boosting their gold holdings during the summer, may be playing a bigger role in the rise of the precious metal to record highs. And further to this point...

Dollar reaches breaking point as banks shift reserves
By Ye Xie and Anchalee Worrachat, Bloomberg; October 12, 2009

World leaders are acting on threats to dump the dollar while the Obama administration shows a willingness to tolerate a weaker currency... The diversification signals that the currency won't rebound anytime soon after losing 10.3 percent on a trade-weighted basis the past six months...

"Global central banks are getting more serious about diversification, whereas in the past they used to just talk about it," said Steven Englander, a former Federal Reserve researcher who is now the chief U.S. currency strategist at Barclays in New York. "It looks like they are really backing away from the dollar."

"The diversification out of the dollar will accelerate," said Fabrizio Fiorini, a money manager who helps oversee $12 billion at Aletti Gestielle SGR SpA in Milan...

Bill Gross, who runs the $186 billion Pimco Total Return Fund, the world's largest bond fund, said in June that dollar investors should diversify before central banks do the same on concern that the U.S.'s budget deficit will deepen.

"The world is changing, and the dollar is losing its status," said Fiorini.

USAGOLD Comment: Getting right to the froth-versus-sober debate which is the focus of this week's NewsGroup, we next consider the following article.

"Gold overload"
By Christopher Barker, The Motley Fool; October 12, 2009

Opinions are like dollar bills: If you print too many of them, their value goes down. Every time gold makes a major move in either direction, suddenly every casual observer becomes a soothsayer, and the whole mishmash of conflicting guidance leaves investors more confused than ever. Investors have heard it all lately, from Fortune's bold prediction of a gold bubble in the making to Peter Schiff's call for $5,000 per ounce.

In my opinion, any notion of a gold bubble flies in the face of overwhelming fundamental indicators that continue to mount, as the world perceives greater inevitability in the dollar's downward trajectory. Former Fed chairman Alan Greenspan himself recently characterized gold's ascent as "an indication of a very early stage of an endeavor to move away from paper currencies."

As for long-term price targets, I would not presume to rule out truly enormous increases for gold if the U.S. government continues to spend, lend, and print dollars as if national solvency didn't matter to the world.

USAGOLD Comment: From the previous article about central bank diversification, it clearly does matter to the world. But a simple swap out of dollars accounts into gold accounts is not necessarily the final word in regard to misplaced expectations...

Is your gold really there?
By Lawrence Williams, Mineweb; October 19, 2009

Banking has run for centuries with the banks themselves only keeping on hand a fraction of the money owed to depositors with the balances loaned out and not always immediately available, if indeed it is even there at all, so when there is a run -- like that on Britain's Northern Rock last year -- the bank concerned can find it tough to keep its head above water.

There are plenty of theories that the gold markets also operate on a similar principle -- or perhaps worse.

It may be no coincidence that the recent surge in the gold price which burst it through the $1,000 barrier followed shortly after Hong Kong demanded repatriation of its gold held in London banks and reports suggest that Germany is also looking for its foreign-held physical gold to be returned from overseas repositories. Has this created shortages of physical gold which holders are now trying to cover?

...what should the investor do? Given the state of the global economy, and the printing of money on a never-before seen scale, there does seem logic in maintaining a decent percentage of one's portfolio in gold...

USAGOLD Comment: Make that physical gold that is closely held. This brings back to mind our July 23rd NewsGroup where we reported on the story "Greenlight Capital's David Einhorn moves to physical gold" in which it was revealed that Greenlight had shifted their gold position out of the gold trust exchange traded fund GLD in favor of physical gold. Speaking of Einhorn, he's back in the news this week, addressing the fifth Annual Value Investing Congress in New York...

Greenlight's Einhorn holds gold, says U.S. policies poor
By Jennifer Ablan and Joseph A. Giannone, Reuters; October 20, 2009

Hedge-fund manager David Einhorn, who warned about Lehman Brothers' precarious finances before it collapsed, said on Monday he's betting on rising interest rates and holding gold as a hedge for what he described as unsound U.S. policies...

Einhorn is president of Greenlight Capital, with more than $5 billion in assets under management.

"Over the last couple of years, we have adopted a policy of private profits and socialized risks -- you are transferring many private obligations onto the national ledger," he said.

Einhorn said, "my instinct was to want to short the dollar but then I looked at other major currencies -- euro, yen and British pound -- and they might be worse." Einhorn added, "Picking these currencies is like choosing my favorite dental procedure. And I decided holding gold is better than holding cash..."

USAGOLD Comment: On that note, endeavor to hold more gold than the small crown you received from your favorite dentist! Straight to the point, place a timely call your favorite broker instead...

	Policy vs Language with Pete Grant and Jonathan Kosares Why jawboning the "strong dollar policy" might be too little, too late.
	Party Time by Ed Stein In this article, our favorite cartoonist takes to the keyboard to lampoon a new American institution, the tuppergold party.

Amid growing rumors that the dollar's days are numbered as the world's primary reserve currency, hot on the heels of our previous NewsGroup gold spent the past week probing progressively new heights above $1,000...

Gold records all time high, December future hits $1,038
proactiveinvestors; October 6, 2009

After weeks of continued support the Gold price has finally broken through to trade at an all time high [gaining] momentum throughout the session with futures making a record high of $1,038. Today's most recent rally breaks the previous record high of $1,033.20 which was set in March 2008...

Speculation over the US Dollar's position as the global reserve currency stepped up another gear this morning, following an exclusive report by the Independent. According to their sources, Gulf Arab states have been in discussions with Chinese and Russian finance ministers, with a view to creating an alternative pricing currency for oil trading...

Undoubtedly the US Dollar's role in the global economic structure is under the microscope, however at such an early stage many feel as though the line between political posturing and actual intent will remain blurred for some time. In the meantime the relative certainty of gold as a physical reserve is likely to persist.

USAGOLD Comment: More on that remarkable story offered by the Independent follows...

The demise of the dollar
By Robert Fisk, The Independent; October 6, 2009

In the most profound financial change in recent Middle East history, Gulf Arabs are planning -- along with China, Russia, Japan and France -- to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen and Chinese yuan, the euro, gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar...

The plans, confirmed to The Independent by both Gulf Arab and Chinese banking sources in Hong Kong, may help to explain the sudden rise in gold prices, but it also augurs an extraordinary transition from dollar markets within nine years...

The transitional currency in the move away from dollars, according to Chinese banking sources, may well be gold...

"These plans will change the face of international financial transactions," one Chinese banker said. "America and Britain must be very worried. You will know how worried by the thunder of denials this news will generate."...

Chinese financial sources believe President Barack Obama is too busy fixing the US economy to concentrate on the extraordinary implications of the transition from the dollar... Iran announced late last month that its foreign currency reserves would henceforth be held in euros rather than dollars. Bankers remember, of course, what happened to the last Middle East oil producer to sell its oil in euros rather than dollars. A few months after Saddam Hussein trumpeted his decision, the Americans and British invaded Iraq.

USAGOLD Comment: Regarding that last comment, a related set of thoughts come to this humble editor's mind with the significant announcement that arrived a mere three short days later in the week. Much is often made of the relationship between the country recognized as the world's preeminent military power and the coincidental employment of that country's monetary unit as the world's reserve currency -- exemplified by the British pound sterling prior to World War I and the United States dollar thereafter. Whether or not President Obama is too busy fixing the U.S. economy, it seems likely that any residual international fears over potential U.S. sabre rattling and intimidation in support of continuing dollar hegemony have been effectively brushed aside with the stunning (seemingly premature?) October 9th selection of Barack Obama as the 2009 winner of the Nobel Peace Prize, with the Committee citing "his extraordinary efforts to strengthen international diplomacy and cooperation between peoples." After all, any such newly crowned ambassador of diplomacy and peace surely wouldn't stoop to that age-old ploy of coercion and whatnot on behalf of currency domination, would they? And as for the suggested nine-year transition timeline, Max Keiser has the following to say in a video interview...

Dollar to be buried way before 2018
RT Studio video interview; October 6, 2009

Max Keiser reacts to the above-cited article by Robert Fisk about the demise of the dollar as an oil-pricing currency, saying that the timeline is moving "a lot faster" and further predicting a 50 percent weighting for gold in any formal currency baskets used in international dealing.

USAGOLD Comment: What might this portend for the future of gold?

NIA says gold could rise to $5,400
By The National Inflation Association; October 6, 2009

Gold hit a new all time high today of $1,044 per ounce and it looks like this break out above $1,000 could be permanent. While this may be a new all time high in nominal terms, adjusted for inflation gold's high in 1980 of $850 equates to $2,300 per ounce in today's dollars. We believe the inflationary crisis we are rapidly approaching will be much worse than the inflation of the 1970's. Therefore, $2,300 per ounce gold could be here sooner than anybody thinks is possible...

The mindset of America is about to change as Americans wake up and realize how rapidly the U.S. dollar is losing its purchasing power. No longer will gold be looked at as a risky and speculative asset. Instead, there will be a rush into gold as the safest asset of all. The new mindset will be that you can't afford not to own gold and you can't own too much gold...

If gold and the Dow Jones were to meet at the median of their current levels, we would be looking at $5,400 per ounce gold...

USAGOLD Comment: That forecast is not so far fetched according to the Aden sisters...

After a good decade, Aden sisters are gleeful about gold
By Peter Brimelo, MarketWatch; October 8, 2009

Mary Anne and Pamela Aden's Costa Rica-based Aden Forecast first came to fame in the last great gold bull market three decades ago. In the current post-2000 gold bull market ... the Adens note that "gold's peak in 1980 at $850 is the equivalent of about $2400 in current dollars. Gold has not even approached that level yet and the situation is far more serious now than it was then."

They conclude:

"The focus now is on the next phase of the current rise. If we continue to use proportions, the bull market's second rise from 1976 to 1980 gained 750%. Using the same growth and applying it to the current bull market, we could see gold eventually reach $4100 during the next run-up. And if you take the entire bull market gain in the 1970s at 2300% and extrapolate, then $5800 would be the equivalent upside target."

USAGOLD Comment: With pro-gold commentary like that starting to make inroads into mainstream press, it came as no surprise that Thursday and Friday's headlines were populated by the likes of "Gold Hits New Record Third Day Running" and this one "Gold Price Spikes As Investors Focus on Hard Assets" as well as the following...

Why gold is a good investment option
By Lakshmi Iyer, rediff Business; October 9, 2009

At the time of global depression and economic slowdown, investors are looking at parking their investments safely. And gold is the obvious choice as a safe investment haven.

It is believed that the incidental impact of US Fed's balance-sheet expansion (currency printing) initiative may see an over supply of paper currency. The money supply in the US economy has been increasing year on year. Including $1 trillion in cash infusions, the stimulus plan will pump $9.7 trillion into the economy, according to Bloomberg...

Also according to US Treasury Dept currently, the US government holds about 286.9 million ounces of gold. It has printed about $1.569 trillion worth of paper dollars. If each dollar were to be backed by gold, that would put the price at $5,468.80 an ounce of gold. ... And although interim volatility cannot be ruled out, gold prices are likely to trade higher.

USAGOLD Comment: And strange as it may seem, even as the U.S. Treasury boasts of having one of the world's largest hoards of gold, it nevertheless admits struggling to supply its own department, the United States Mint, with enough gold "sufficient to meet public demand." Read more about it here...

First, a bit of global economic context from some respectable sources...

A special report on the world economy
By The Economist, print edition; October 1, 2009

The world economy is fitfully getting back to normal, but it will be a "new normal". ... In the new normal, as defined by Pimco's CEO, Mohamed El-Erian, growth will be subdued and unemployment will remain high. "The banking system will be a shadow of its former self," and the securitisation markets, which buy and sell marketable bundles of debt, will presumably be a shadow of a shadow...

Financial crises can pose such a threat to national incomes because of the way they erode national wealth...

Public debt will rise so that private debt can fall... [Irving] Fisher, again, put it best: "I fancy that over-confidence seldom does any great harm except when, as, and if, it beguiles its victims into debt."

USAGOLD Comment: Given that a Dollar merely represents a monetized, circulating unit of the expanding public debt, it should be evident to every thinking person that a meaningful and reliable savings cannot be be built upon such an unsuitably deteriorating set of building blocks. Choose instead a foundation of gold and you will truly separate your savings from the tumbling clutches of the public debt. No less than U.S. Senate candidate Peter Schiff says buy gold...

Schiff anticipates a world returning to gold
Video Interview, TheStreet.com; October 1, 2009

USAGOLD Comment: Schiff has been right on the mark thoughout the runup to the current financial crisis. Hear what he has to say at the video (linked above), and then brace yourself for our following line-up of the latest price predictions for gold...

Gold -- what price structural change in the industry?
CRU Group Bulletin; October 2009

Since the collapse of Lehman Brothers in September 2008, there has been a fundamental change in perception of credit, market and sovereign risk default. The gold market has correspondingly undergone a key change in its dynamics, to the extent that it now faces profound structural change.

As a result of these developments, we consider gold will increasingly be regarded as a strategic asset by both the state and private sector, whether or not the dollar strengthens in the short term. State gold sales and purchases will be conducted even more carefully and in a more orderly manner, and some countries may opt for greater state control over and involvement in domestic (primary and secondary) gold production and sale. This could impact exploration and mining operations of overseas entities. Moreover, any suggestion of a break-down in international cooperation regarding a managed and possibly phased weakening of the US dollar could see considerable upside gold price potential...

An investment-led sustained break through the $1000/oz nominal price level will alter the dynamics of the physical gold industry...

USAGOLD Comment: $1,000... that's where we are, but now where do we go from here? (Also, did you note the caution against mining interests due to the likelihood of increased state control?) Read on...

Gold is a currency you can rely on
By Paul Murphy, Associate Editor with the Financial Times; October 5, 2009

I was pulled up short at the end of last week by the final paragraph in a daily research note that I am now reading on daily basis -- "Lunch with Dave", the regular musings of former Merrill Lynch strategist David Rosenberg, who has now downsized to a Canadian brokerage, Gluskin Sheff.

"...if there is a shred of truth in what Karl Rove had to say in yesterday's op-ed piece in the Wall Street Journal ('Obama Can't Outsource Afghanistan'), then gold is likely going to go much, much higher than $1,000 an ounce. That's the currency we prefer."

USAGOLD Comment: Let's see if we can put an actual number on the notion of "much, much higher"...

Deutsche sees gold above $1,100/oz in 2010
By Pratima Desai, Reuters; October 1, 2009

The gold price will set a new record high next year as the dollar tumbles and inflation is fueled by government deficits and loose monetary policy around the world, Deutsche Bank said on Thursday.

Gold will move above $1,100 an ounce during 2010... "We are positioning for fresh highs in the gold price," the German bank said in a note, adding its gold price forecast for 2010 had been revised up more than 30 percent.

USAGOLD Comment: The Germans sense a coming 10 percent rise, meanwhile the Indians foresee a bit more arriving sooner...

Sky-high prices fail to dampen pre-festival gold rush in Delhi
By Neha Pushkarna, Economic Times; October 5, 2009

NEW DELHI: Himani Kapur is getting married end of this month. Braving these times of inflation, she recently bought eight gold bangles and three gold sets for her wedding... "I had to buy gold by cutting down on other expenses. Traditionally, marriage preparations are not complete if you haven't bought gold," Himani said.

...the price of gold has been hovering around Rs 15,000 per 10 gram for the last couple of months...

"There is speculation that the price of gold may touch Rs 17,000-18,000 per 10 gram by year-end [i.e., up 13 to 20 percent]. So the people who may have wedding in the family later in the year or early next year are already buying gold. This has also helped in pushing up the demand," Soni said. He added that people were also buying raw gold as an investment anticipating further hike in gold price.

USAGOLD Comment: The Indians sense an imminent 13-20 percent rise, meanwhile the Russians expect still more upside...

Russian gold miners eye record prices, output growth
By Polina Devitt and Robin Paxton, Reuters; October 1, 2009

Gold miners in Russia, the world's No. 5 producer, on Thursday ... forecast the metal's value would soon reach uncharted highs above $1,030 an ounce.

"I'm expecting something like $1,200 by the end of the year," Pavel Maslovsky, chief executive and co-founder of Petropavlovsk Plc, told Reuters...

"The dominance of the dollar as the world reserve currency is starting to decline and gold will be its natural descendant," said the Polymetal chief executive. "Over three to five years, I believe both gold and silver will show very significant price increases. I wouldn't rule out doubling the prices in three years."

USAGOLD Comment: And would you believe that a U.S. economist sees gold going yet higher still?

Nichols gets even more bullish on gold
By Lawrence Williams, Mineweb; October 5, 2009

U.S. gold economist, Jeffrey Nichols, seems more bullish than ever on the prospects for substantial upwards movement in the price of gold over the next few years considering the latest development in the markets, perhaps even more so than in his previous analyses. While Nichols has tended to be a gold bull in the past he has also been one of the more sober commentators amongst this genre so his developing views do require some attention...

Nichols concludes that thanks to extremely expansionary monetary policy -- and with a little help from ETF investors, central banks, and new or evolving markets - like China and India -- the gold price will continue to move ahead. He reckons $2,000 to $3,000 is on the cards in the next few years.

USAGOLD Comment: Stay tuned, fellow goldmeisters...

"The inflation-adjusted price of gold at its 1980 peak is just over $2350 - that leaves a considerable amount of headroom just on the basis of making up for past inflation, let alone the prospect of continued inflation." Link Some solid reasons why gold makes sense over $1000 from USAGOLD's in-house economist, Pete Grant.

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