Wednesday, March 23, 2011

Rob McEwan Says Gold May Rise To $5,000 In Next Few Years

More willing to go out on a limb than his counterparts at the big producers, Mr. McEwen said that the gold supercycle will help gold top out at $5,000/oz in a few years.
"Gold is used as insurance for bad governments," Rob McEwen, chairman and chief executive of Minera Andes Inc and US Gold Corp, told Reuters on the sidelines of the Mines and Money conference in Hong Kong on Wednesday....

McEwen said gold was in the middle of a super cycle that could end by 2015, adding that the length of the gold super cycle and the $5,000 forecast were based on historical gold prices and the ratio of the Dow stock index against gold since 1970.

If his forecast does come true, then gold will be at the climax of an all-out blow-off top by that time. The end of the cycle will be followed by a vicious bear market that'll likely slice two thirds off the peak price. If $5,000 is the top, then the bear market low will be more than $1,500.

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