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Blackstone Advisory Chief is Bullish on Gold

Release Date: 
Wednesday, June 27, 2012

Gold prices were steady on Wednesday as the euro fell and commodities were under pressure. Gold was $0.30 higher at 7:11 a.m. Pacific Time on the New York Spot Market, trading at $1,573.90 per ounce. Spot silver was $0.04 lower, trading at $27.17 per ounce. (Click here for the most current spot prices.)

German Chancellor Angela Merkel dashed hopes for common Eurozone bonds ahead of the EU summit, saying it would not happen "as long as I live."

Byron Wien, the chairman of Blackstone Group LP's advisory services unit, said "I've been bullish on gold and I'm still bullish on gold. I know gold has pulled back very sharply, but here's where we are:  The central banks around the world are printing money. They're debasing their currencies. It's a race to see who is going to debase it more. Gold is something real. Ultimately, gold will sell at a higher price. It's come down recently, but I think if you have a long term view, you're going to make money in gold. You should own it as an insurance policy, not as a commodity play."

Robert Fitzwilson, founder of The Portola Group, said "if the Fed and other central banks continue with these artificially low interest rate policies, investors should brace themselves for unimaginable turmoil both in the markets, and in the financial system itself. In the meantime, investors need to protect themselves by owning a basket of hard assets and key sectors. For what it is worth, this is wildly bullish for gold and silver."

"In our view, gold remains in a secular bull market," wrote Bank of America Merrill Lynch technical analyst Mary Ann Bartels in a research note co-authored with Stephen Suttmeier and Jue Xiong. "Longer-term, we expect gold to move to new highs with projected resistance in the 2100-2300 area."

Turkey, Russia, Kazakhstan and Ukraine increased their central bank gold holdings by more than 25 tons between them in May, IMF data showed on Tuesday.

(Sources:  "PRECIOUS-Gold eases with euro, commodities ahead of EU summit," Reuters, June 27, 2012; "Wien Says Gold Offers Investors Insurance," Bloomberg, June 26, 2012; "Brace For Turmoil In Global Markets As Spanish Domino Falls," King World News, June 26, 2012; "Time For Gold To Rally To $1700 And Beyond, Says BofA's Bartels," Barron's, June 25, 2012)

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†This material has been prepared for private use. Although the information in this commentary has been obtained from sources believed to be reliable, Goldline does not guarantee its accuracy and such information may be incomplete or condensed. The opinions expressed are subject to change without notice.

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