The Golden Truth: Prominent Mining Executive Says Gold Will Eventually Go To $5,000

Wednesday, January 13, 2010

Prominent Mining Executive Says Gold Will Eventually Go To $5,000

Rob McEwen is one of the most well respected professionals in the precious metals business. He built Goldcorp into one of the world's biggest gold mining companies, with the lowest mining cost per ounce. Now he runs the junior exploration mining company, U.S. Gold. When I first got into this sector over 8 years ago, Goldcorp was a $2 stock. It's now over $40 and pays a monthly cash dividend. I think it's safe to say that McEwen's views should at least be taken into consideration and respected.

Rob was interviewed on Bloomberg yesterday and said he believes gold will hit $2000/oz in 2010 and eventually hit $5000/oz. in the 2012-2014 timeframe. I know a few years ago McEwen was the first visible mining executive to call for $1000 gold. This interview is short and worth watching (kudos to Ed Steer at Ed Steer's Gold & Silver Daily): VIDEO LINK

12 comments:

anliuThursday, 14 January, 2010
Dave have you seen Bill Still's documentaries, The money masters and Secret of Oz? I agree with him that switching over to a pure gold backed currency would be a terrible move at this point in time, mainly because never before has the world's gold wealth been so concentrated in so few hands; namely the Rothschilds. Putting my personal gold bug biases aside I have to agree with him, that its not what backs our currency but who controls its supply.
ReplyDelete
Replies
JoeThursday, 14 January, 2010
It is nice to see a mining executive come out and call for 5K Gold. However, I am of the belief we will see 5K Gold this year simply because the demise of the USD is imminent.

Joe M.
ReplyDelete
Replies
AnonymousThursday, 14 January, 2010
So is US Gold another $2 stock that's going to $40?
ReplyDelete
Replies
Dave in DenverThursday, 14 January, 2010
anliu - have not scene Still's work, but there's certainly some merit to that idea. I don't know what the final solution will be, but it should include gold as part of the equation. Clearly, Governments can't be trusted to operate w/out a currency anchor.
ReplyDelete
Replies
Dave in DenverThursday, 14 January, 2010
@Joe: dollar demise is on the horizon, not sure if happens this year. one thing i've discovered is that collapses take longer than i expect. I thought housing would collapse in 2005 LOL
ReplyDelete
Replies
Dave in DenverThursday, 14 January, 2010
@Anonymous: I don't know. When McEwen took it public a couple years ago it zoomed up to like $8 because of his reputation. I haven't really looked closely at it and I do not own it so I can't speak intelligently as to the fundamentals. I did do a "drive-by" look at it several months ago and it looks like there's potential.
ReplyDelete
Replies
EconomicDisconnectThursday, 14 January, 2010
Au/Ag still looking resilient, but so is this market rally. INTC beating earning big (and a increase of 10X 40 cents/share vs 4cents/share a year ago!? Hows that happen?) will probbaly drown out all the other bad news.
ReplyDelete
Replies
Dave in DenverThursday, 14 January, 2010
gyc, i don't even bother looking at INTC's numbers anymore. there's so much channel-stuffing going on in the tech industry that it's impossible to tell for sure what's real and what isn't. I didn't look at the news release, but unless they're selling a lot of product in Asia the numbers are bullshit. You see the retail sales numbers? Strip gasoline inflation out of that and they were a complete disaster. people were'nt loading up on computers in thsi country.

they may have gotten a boost from selling netbooks. but another trick they do, and i've seen pics of this, they recognize sales when a shipment leaves port on a ship, so what they do at the end of the qtr is load up a lot of "slow boats to China" and that product is counted as sales.

The economy is absolutely collapsing. My buddy told me his parents were in Atlantic City earlier this week for an annual mid-week trip to Harrah's because they get a comp room and they said AC was an absolute morgue. They've never seen it like this. Gaming is a direct barometer of economic health.
ReplyDelete
Replies
EconomicDisconnectThursday, 14 January, 2010
Dave,
my favorite quip from the INTC CFO:
"Smith said Intel had not yet seen signs that big companies are feeling freer to replace their old PCs, but that he expects it to happen this year."
Well I have been "expecting" to win the lottery for a while now but no dice! At least he is CONfident.

Oh yeah,
FNM/FRE bailouts to cost more than Iraq and Afghanistan combined.
ReplyDelete
Replies
Dave in DenverThursday, 14 January, 2010
FNM/FRE will ultimately cost at least a trillion, I bet.
ReplyDelete
Replies
PeterSchissel.comThursday, 21 January, 2010
Anyone own US Gold? I do and I am glad I bought several thousand shares.However, I welcome comments re: where this company and where the price of gold will go.
Comments?
ReplyDelete
Replies
Dave in DenverThursday, 21 January, 2010
Hey Peter, I don't own US Gold but at some point I'll probably revisit the story and make an assessment. I don't have room for it in my fund right now but you can't go wrong investing in Rob McEwen.

Will do a post on it when I get around to looking at it.
ReplyDelete
Replies

Add comment

Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.