Gold Will Plunge 25 Percent in 2011

[Twisted Titan]

Doug Kass: Gold Will Plunge 25 Percent in 2011

http://www.moneynews.com/StreetTalk/DougKass-Gold-Plunge-25Percent/2010/12/21/id/380558

By Julie Crawshaw

Seabreeze Partners' Doug Kass says gold will be highly volatile in 2011, plunging 25 percent.

“I think that gold is going to be one of the worst asset classes of the new year,” Kass told CNBC. “It’s going to display an unprecedented volatility in 2011.”

“I think gold plummets more than $250 an ounce in a four-week period sometime in 2011, routinely moves $75 to $100 a day and briefly trades under $1,050 an ounce, ending the year at roughly between $1,100 and $1,200 an ounce.”

Kass says his view “starts with the observation that gold is a lot like religion.”

“No one can prove that God exists or that God doesn’t exist,” says Kass. “It’s simple. Either you believe in God or you don’t.”

“Well, that’s exactly the way I think it is with gold.”

Gold bugs, Kass observes believe that gold is in finite supply and is more valuable during inflationary and uncertain times, and gold has been a store of value for thousands of years.

However, gold is now viewed as a commodity for all seasons. “Gold has limited industrial value, throws off no income or cash flow and you can’t analyze it with very much precision.”

“It’s subject to wide price swings.”

Kass says he’s also concerned that the SPDR Gold Trust (GLD), the largest gold holder in the world, is heavily concentrated in the hands of hedge-fund managers like (John) Paulson.

“That’s a very slippery slope,” says Kass.

Bloomberg Business Week reports that gold prices rose on concerns about Europe’s debt, with gold for February delivery gaining $6.90 to settle at $1,386.10 an ounce.

Read more: Doug Kass: Gold Will Plunge 25 Percent in 2011

[gunDriller]

volatility, yes.

a fall from $2000 to $1500, maybe (that would be 25%).

but a rise in the value of the US $ from .0005 to .00067 Toz. of gold - that's a 33% increase.

[kregener]

If it does, and I think the guy is an idiot, it will only be another BUYING OPPORTUNITY.

[Silver Shield]

Doug Kass is a fiat shill who can't sheer the sheep when they buy gold...

[Serpo]

Doug Kass is a fiat shill who can't sheer the sheep when they buy gold...




Certainly sounds like it or he is psychic...

[Twisted Titan]

Gold bugs, Kass observes believe that gold is in finite supply and is more valuable during inflationary and uncertain times, and gold has been a store of value for thousands of years.

Yes yes and yes



However, gold is now viewed as a commodity for all seasons. “Gold has limited industrial value, throws off no income or cash flow and you can’t analyze it with very much precision.”

There are many industrial appliactions for gold.

Its not about throwing off cash flow it is about preserving capital without no exposure to counterparty risk.

The reason why it cant be analyized with presicions is because the master of Fiat hold the price in check in a true market gold would be somewhere around 56,000 dollars a ounce

[osprey]

Doug Kass is a fiat shill who can't sheer the sheep when they buy gold...




You beat me to it. If there is a downward correction, it will be a great opportunity for better buying power.

[Ponce]

I don't look at the bumps on the road when it comes to PM, only at the light at the end of the tunnel.....and
is getting closer and closer.

[dumpster]

gold will troll speak drop in 2011,, from what level ,, 1750 or so,, that woukld give you a base of 1500 bucks ,,, the top callers have eeen wrong all the way from gold 300 silver 4 bucks

usually the very ill informed .. sucking eggs on a very small row boat,

do these little remarks BOUT GOLD enhance the little light weights . of course not ..

they show trolls ville .. and some one who drops nickles for pennys :sicko

litle gastro juices of smallsville

[Sparky]

A drop to $1050 would be SWEET!

[Dogman]

I don't look at the bumps on the road when it comes to PM, only at the light at the end of the tunnel.....and
is getting closer and closer.


Wise man.

I always wonder about the people that can say this percentage or that ..After the fact yes any dummy with a tad of math can do it.

But to see the statistical future, has to have a basis to predict from, and we now my friends are treading new waters..

Unless the one making the predictions makes their living by the same , just like the ones on tv or radio, anything to make a buck, even if they do not personally believe in what they say.

Dos pesos.

;D

[Sparky]

Let me share one of my favorite tables. Using a July 1 to June 30 annual cycle (since the gold price is seasonal), here are the annual high and low prices (daily London fix) and their dates, since this gold bull began:

Low Date Low High Date High
2001-02 7/6/2001 $265 5/29/2001 $327
2002-03 8/1/2002 $302 2/5/2003 $382
2003-04 7/17/2003 $343 4/1/2004 $427
2004-05 7/29/2004 $387 12/2/2004 $454
2005-06 7/15/2005 $418 5/12/2006 $725
2006-07 10/6/2006 $561 4/20/2007 $691
2007-08 7/6/2007 $649 3/18/2008 $1,011
2008-09 10/24/2008 $712 2/20/2009 $989
2009-10 7/13/2009 $908 6/28/2010 $1,261
2010-11 7/28/2010 $1,157 11/9/2010 $1,421 (so far)

On average, the high for the current year is 60% higher than the previous year's low. So with a $908 base from last year, a reasonable high for this year is $1453, so we may have already hit it at $1421. The highest jump from the previous year's low was 87%, which would translate to $1698.

On the downside, the low for each year has averaged 12.7% below the previous year's high. So if we have peaked at $1421 for the year, the "expected" low for the July-October 2011 period would be $1240. There have been two drops more than 20%, with the worst being 29.6%. That would translate to an upcoming low of $1000.

So the Kass prediction would be entirely consistent with what has been happening in this decade-long bull run so far. If the market wants to sell us gold at $1050 again, I say thank you very much.

[Walter Mitty]

China is buying. Other Central banks are buying. Supposedly a Swiss bank refused to deliver to
a holder. He had to hire a lawyer to get delivery. The IMF anounces a Gold sale and the market doesn't even blink. If Gold drops that much every heavy hitter on the planet will be buying for delivery. It would bust the Comex and LBMA. I think the PTB like the price right where it is. Just my .02.

[FunnyMoney]

China is buying. Other Central banks are buying. Supposedly a Swiss bank refused to deliver to
a holder. He had to hire a lawyer to get delivery. The IMF anounces a Gold sale and the market doesn't even blink. If Gold drops that much every heavy hitter on the planet will be buying for delivery. It would bust the Comex and LBMA. I think the PTB like the price right where it is. Just my .02.


And while that goes on, the cost of mining is going up, way up and the grades and amounts coming out of the ground are lackluster. With the central banks that had been selling, no longer selling a 20% supply/demand shortage has materialized. This doesn't equate into price declines beyond normal market chatter. I would be very surprised to see anything under $1330. I think we move on to new highs, the $1360 area has already already shown strong support.

[Twisted Titan]

And to think that average person can still buy a ounce of Sliver for under 40 bucks boggles my mind

The advantages for owning physical PM's is this economic climate cannot be overstressed it may litterally be difference between living on your own terms or being a refugee.

Better keep buying with both hands.

T

[hoarder]

Doug Kass is a fiat shill who can't sheer the sheep when they buy gold...


I think it's safe to assume he's a member of the banking tribe.

[vacuum]

Here's the thing about pms....what other form of wealth is there that you can take physical possession of? Fiat, bonds, stocks, even deeds are just pieces of paper that require someone else to redeem and recognize them. They can be taken by the flick of a pen by some government official.

[Twisted Titan]

Here's the thing about pms....what other form of wealth is there that you can take physical possession of? Fiat, bonds, stocks, even deeds are just pieces of paper that require someone else to redeem and recognize them. They can be taken by the flick of a pen by some government official.



Physical Gold and Silver are the only investments that I know of that hold no counterparty risk.

T

[Uncle Salty]

Here's the thing about pms....what other form of wealth is there that you can take physical possession of? Fiat, bonds, stocks, even deeds are just pieces of paper that require someone else to redeem and recognize them. They can be taken by the flick of a pen by some government official.


Exactly. No counter party risk at all. None. Zip. Zilch. Nada.

[undgrd]

Let me know when Central Banks start throwing Gold into the streets...then we can talk.

[bellevuebully]

I'm actually very shocked that there are still quite a few gold pundits that think gold still has a strong possibility to move substantially higher during the last week of trading. I would think it would be fairly quite trading, but who knows? Anything is possible.

[FunnyMoney]

I'm actually very shocked that there are still quite a few gold pundits that think gold still has a strong possibility to move substantially higher during the last week of trading. I would think it would be fairly quite trading, but who knows? Anything is possible.


Get in before the Jan. rush.

[Ponce]

For now you only worry about the price of PM .....if you need the money.......if you think that you will need the money............why don't I worry about the price?.........ehheheeheheheh.......I don't need the money.

[platinumdude]

So when is this plunge happening?

[FunnyMoney]

So when is this plunge happening?


My best guess is that after we get to about $88 we take a tumble back to roughly $77 (a move to $66 would be 25% drop, but I don't think we see that). Still, the tumble should shake a few week hands out. From there it should be a direct shot to around $121. For the move to over $200, we'll just need to wait and see how things play out with the oil market and the economy and all.

[Ragnarok]

Doug Kass: Gold Will Plunge 25 Percent in 2011

“No one can prove that God exists or that God doesn’t exist,” says Kass. “It’s simple. Either you believe in God or you don’t.”

“Well, that’s exactly the way I think it is with gold.”


He left out those who know that God exists (and don't have to prove it), and imo, it's not physical gold that will plunge, it's the paper contract gold price that will plunge while physical does the exact opposite.

2c, R.