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Gold and Silver Prices
Gold prices reached a four month high following news the Swiss central bank eliminated its support of the euro, creating chaos in the markets.
“‘Gold is gaining from a risk-off situation because nobody expected the Swiss central bank not to keep that cap, and this has created potential big losses in many places and is obviously triggering some flight to safety,’ Saxo Bank senior manager Ole Hansen said. ‘This is happening a week before the ECB meeting, which could add even further pressure to the euro…but gold in euro terms should benefit.’” (“Precious – Gold jumps more than 2pct to 4-month high after SNB move,” Reuters, 01/15/15.)
"‘When central banks act unexpectedly, they add to the uncertainty in the market and that makes people gravitate toward things that are safer, and that's gold,’ said Adam Klopfenstein, a senior market strategist with Archer Financial Services in Chicago.” (“Gold Shines as Traders Seek Safety from SNB’s Shock Move,” The Wall Street Journal, 01/15/15.)
Gold finished the week up $66.10, closing at $1,290.50. Silver prices closed the week at $18.34, up $1.72.
Faber: Gold to Rise 30% in 2015
Marc Faber, investment analyst and author of the Gloom Boom Doom Report, told attendees of Société Générale’s global strategy conference that he was ‘positive that gold will go up substantially [in 2015] – say 30 percent…My belief is that the big surprise this year is that investor confidence in central banks collapses. And when that happens – I can’t short central banks, although I’d really like to, and the only way to short them is to go long on gold, silver and platinum,’ he said. ‘That’s the only way. That’s something I will do.’” (“Market Doomsayer Marc Faber: Gold will Rally 30 percent in 2015,” MarketWatch, 01/13/15.)
Veteran Forecaster: Gold Should be $2,000 Per Ounce
Veteran trend forecaster and publisher Gerald Celente told Kitco News that gold prices will go higher due to the decline of the world currencies.
“What’s going to drive up the price of gold is the value of the currencies are going to continue to decline…. Gold should be over $2,000 an ounce. This is a very different world [than when gold hit its high in 1980]. You’re seeing demand in China, demand from India, you’re seeing physical demand everywhere that didn’t exist back then… We think the bottom [for gold] is already here. We believe this is a good year for gold…” (“Gold Should Be At $2,000 An Ounce - Gerald Celente,” Kitco, 1/14/15.)
Sterne Agee: Gold Only Currency That Central Banks Can’t “Debunk”
Sterne Agee's precious metals and mining analyst, Michael Dudas, told CNBC that gold will likely rise to $1400 in 2015 as central banks continue to debase their currencies.
"’All these central banks are all going to debunk their currencies… And it's going to default to just one currency that can't be debunked, and that's gold… Gold in terms of euros is at its highest level since May 2013,’ Dudas said. Many investors expect the European Central Bank to announce a major stimulus plan when it meets next Thursday. That could also drive gold higher.”
“’Certainly [Thursday's] announcement by the Swiss National Bank caught everyone by surprise, but it just shows gold's safe haven status,…’ said Dudas… With global uncertainty not expected to let up anytime soon, Dudas thinks gold could rally another 11 percent by the end of the year… “We see gold going to $1,400 by the end of the year.’” (“Why 2015 will be the year for gold: Top analyst,” CNBC, 1/15/15.)
Doug Kass, the president of Seabreeze Partners Management Inc. and the former senior portfolio manager for a $6 billion investment partnership, offered seven reasons why he owns gold:
“1. Gold, given the current issues, could be increasingly considered a currency and not a commodity.
“2. Central banks around the world are doing anything they can to suppress the value of their fiat currency vs. all others, with the battle inevitably helping the only currency that cannot be manipulated by central banks: gold.
“3. The Swiss National Bank has thrown in the towel in its money-printing regime, realizing it is a battle that cannot be won… All this is gold constructive as it's a repudiation of the perceived virtues of currency depression.
“4. India, a few months ago, further eased import restrictions of gold and I expect them to further the relaxation of import tariffs.
“5. China remains a voracious buyer of gold and the trend of gold moving from West to East continues.
“6. Even Russia realizes that having more gold in its reserves is a key foundation of stabilizing one's currency.
“7. The Federal Reserve is expressing some concerns about the impact of a strong U.S. dollar and they are the last central bank to play in the FX war sandbox. So, gold is now in the process of rallying against all currencies and is no longer a non-dollar play.” (“Why Is Doug Kass Still Buying Gold Now? Here Are Seven Good Reasons
Gold Is One Currency that Can’t Be “Debunked,” TheStreet, 1/16, 15.)
Following gold’s fast start to the year, analysts, such as Sterne Agee’s precious metals analyst Michael Dudas, are predicting that 2015 will be a great year for gold.
“‘All these central banks are all going to debunk their currencies,’ said Dudas. ‘And it's going to default to just one currency that can't be debunked, and that's gold…Gold in terms of euros is at its highest level since May 2013…We see gold going to $1,400 by the end of the year.’" (“Why 2015 will be the year for gold,” CNBC, 01/15/15.)
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Goldline provides a wrap-up of the week's precious metals news along with important commentary on the American Advisor Week in Review audio program.