“49 Reasons All In A Line. All of them good ones. All of them lies.” Stephen Stills.

Last week a gold market participant provided us a collection of 10 gold price forecasts.

1. $5,000 to $10,000.
2. $5,300…$5,700… $3,100.
3. $6,221 … $10,000
4. $3000 – $4000
5. $6,000 
6. $5,000 and $10,000
7. $5,000
8. $5,000
9. $5,000
10. $10,000

These folks are not liars. They simply are Believers who either do not know or choose to ignore basic principles and realities of finance, monetary mechanics, politics, economics, or history. They also misjudge gold supply, fabrication demand, investment demand, central bank gold policies, above ground refined bullion and coin inventories, and gold supply and demand price and income elasticity.

We will not bother you with details, other than to point out that these gold bulls have been predicting since at least the 1970s that economic and financial excesses would lead to a global financial collapse and gold prices rising to $5,000, $10,000… whatever. They have been wrong on their economic outlook and their gold price projections for nearly half a century. At what point does one say to oneself, “Maybe I should stop listening to people who have been wrong for 30, 40, 50 years.?”

John Maynard Keynes made at least two famous comments that are relevant here.

1. “In the long run we are all dead.”
2. “When the facts change, I change my mind. What do you do, Sir?”

Investors need the real economic and gold market research and analysis that CPM supplies clients.

• We expect gold prices to rise, but we are looking at $1,920 in the next three months and a peak around 2023 – 2025 on an annual nominal average around $2,300 before falling back quickly.
  • That is what gold and other asset prices do. They rise and they fall. Gold prices declined after their increases in 1967 – 1969, 1974, 1979 – 1980, 1986 – 1987, 1992 – 1996, and 2000 – 2011. There is no reason to think this tiger has changed its stripes.
• CPM understands the gold market constraints to future prices: Why they do not stay at peaks.
• We base our price projections on a realistic understanding of the monetary and financial system, including its risks but also its resiliency.

CPM Group’s Three-Month Gold Price Projections

Precious Metals Advisory, 9 July 2020

Put it this way: The analysts at CPM have been projecting period bouts of financial and economic recessions, failures, and problems since 1978, but we have never assured our clients that the global financial system was about to collapse entirely. That is not the way the world works, for many reasons.

We have built an enviable track record by basing our gold price projections on sober projections of the global macroeconomic and political environment and a firm understanding of how mine production, secondary recovery, investment demand, fabrication demand, and central bank transactions all react to and influence gold prices.