Speaking to the Prospectors and Developers of Canada Association (PDAC), fund manager Oliver Frank predicted that silver will end the year in the $25 range. Additionally, he also believes that heightened global investment demand will help gold break the $1,500 mark by years end. The reason? A safe haven response to the onset of (hyper) inflation in the U.S. economy.

In a March 5th article (Bloomberg), Michael Pento, Chief Economist at Delta Global Advisors, is quoted as saying “the government has created a massive increase in the monetary base and it means we entering a massive inflation cycle. Inflation will be intractable.” Mr. Pento goes on to say that gold should now be a primary investment.

These observations and predictions are coming from mainstream investment analysts, not the usual gold enthusiasts to say the least. Even Richard Russel, author of the Dow Theory Letter, has taken the position that you can’t own enough gold.

The one consistent reason all of these mainstream analysts point to in their writings regarding precious metals is the monetizing of the vast sums of money that the Fed and the Treasury Department are creating in their attempt to jumpstart the economic engine and reflate the U.S. and world economy.

Indeed, we live in historic times. Many people wonder just how much money can we print before the world loses confidence in the dollar as the reserve currency of the world. Time will tell. We can only hope that you position sufficient assets into precious metals to offset the coming tidal wave of inflation that this growth in the money supply must cause.

-From The Desk of the CEO

Tags: Gold, Silver

This entry was posted on Monday, March 16th, 2009 at 8:44 am and is filed under Commentaries. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.