Gold Prices Finally Catch Fire
Source: Seeking Alpha (9/19/08)
If the United States sinks into a deep recession that spreads into emerging markets, Citigroup Global Markets analyst John Hill expects gold would "double or triple" from current levels.
Mr. Hill wrote: Gold is finally displaying classic safe-haven attributes and de-coupling from other commodities, after being held down recently by de-leveraging, distress selling and dis-inflation...Gold appears to be entering a powerful new phase of investment demand tied to safe-haven and monetization themes.
No matter what, Mr. Hill thinks the outlook for gold looks strong. If the United States sinks into a deep recession that spreads into emerging markets, he expects gold would "double or triple" from current levels. A more likely outcome is slow growth accompanied by monetization and socialization of derivative losses, which he figures is likely to hurt paper currencies and help gold.