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Will Mainstream Funds Start Buying Gold in 2012?

Written by Gary North on January 27, 2012

Jim Sinclair has been in the gold-related investment industry for 40 years. He has watched it rise and fall and rise again. He is convinced that the Federal Reserve’s announcement on January 25 was a turning point. He thinks it announced endless fiat money.

He thinks that mainstream companies will now be buyers. This includes pension funds, insurance companies, and health care plans. In other words, Main Street. He says: “This is a huge change, huge new demand, a total new definition.”

If he is right, this will push gold up and keep it up. The gold market is a thin one, as I have written for three decades. The mainstream investors still regard it as fringe. Sinclair understands this. This will be “a game-changer for corporate America and corporate global Western finance, to begin to look at gold as an alternative to the normal cash and debt instruments they would use to hedge themselves.”

He sees 2011 as a year of confusion on gold. He thinks 2012 will be a year of action. The Federal Reserve is taking action. It promises to take more action.

How high will gold go? He thinks $1,700 to $2,100 will be the trading range.

He had predicted $1,650 for two years before 2011. He was right.

He thinks any breakout above this will indicate a loss of confidence in currencies. It will be the dollar that will be at risk.

These are not off-the-wall forecasts. I think if gold goes above $2,000, that will be a trigger point. The public will notice.

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