Gold Analysts Are Far from Gold Bugs

Below we highlight a price chart of gold since the start of 2008 along with the median price estimates of gold analysts across Wall Street going out to 2013. The price estimates shown are quarterly through the first quarter of 2011, and then yearly from the end of 2011 through the end of 2013.

Based on these estimates, gold analysts don't seem too worried about a falling dollar and rising inflation.

Their current estimates for the end of 2009 are at $960, and they get up to $1,000 by Q3 2010 before progressively dropping all the way down to $800 by the end of 2013. This isn't to say that there aren't analysts expecting gold to be higher than it is now in the coming years, but the collective estimate is currently for the metal to head lower.

Comments

[Screwloose:]

What were their 5-yr estimates at the end of 2004....?

Oct 07 05:53 PM

[Gardener:]

Hmmm, the value of analysts advice...

Oct 07 06:09 PM

[Roger Knights:]

"the collective estimate is currently for the metal to head lower."

Most of these analysts are think "inside the box" -- i.e., considering gold as a commodity with calculable supply and demand characteristics. this is what they're expert in analyzing--that's their "hammer." This method has worked well in the past. But things are changing, with gold acting more as a super-national currency. central banks moving toward becoming net buyers, and an increasing number of large investors adding a bit of gold to portfolios as "beta blockers." And there's the chance of a "sudden stop" collapse of the dollar--see, among others, seekingalpha.com/artic... These trends and contingencies are incalculable, and are also out of their area of expertise, and so they aren't factoring them in, or doing so only very conservatively.

Oct 07 07:55 PM

[User 480319:]

gobbledygook

Oct 07 07:56 PM

[frdm45:]

I'll skip any comments on analysts for they would be superfluous to what has been written above.

I would REALLY like to pose one question: what is the FLOOR for gold, the worst case scenario? Don't most of the producers costs range between about $500 to $700 per ounce? Doesn't that mean at prices below $700 mines start to be put on care and maintenance, at least the ones that are pure gold plays? And we know what that would do to the supply-demand equation all other factors being equal. Given this do you think it's more likely gold will be north or south of $1000? (rhetorical)

Oct 07 09:21 PM

[The Geoffster:]

We know it's not 0 which is a hell of a lot more than you can say for the dollar.


On Oct 07 09:21 PM frdm45 wrote:

> I would REALLY like to pose one question: what is the FLOOR for gold,
> the worst case scenario? Don't most of the producers costs range
> between about $500 to $700 per ounce? Doesn't that mean at prices
> below $700 mines start to be put on care and maintenance, at least
> the ones that are pure gold plays? And we know what that would do
> to the supply-demand equation all other factors being equal. Given
> this do you think it's more likely gold will be north or south of
> $1000? (rhetorical)

Oct 07 09:56 PM

[nixonstheone:]

Isn't it normally the advice to do just the opposite of the experts? The ones who were pushing the banks just before the cataclysm?

Are these experts assuming a contraction in the money supply?

Oct 07 10:53 PM

[garuche:]

Yep and all these gold analysts have wallstreet paper stuffed in their pockets (and maybe a few other places) Good luck suckers! I'll stick to gold which has done fairly well for me in the last 10 years. You can follow the gold market 24/7 at coininfo.com

Oct 07 11:28 PM

[garuche:]

Gold analysts don't seem too worried about a falling dollar and rising inflation.

This statement also shows how stupid these so called analysts are.
By the way Bespoke Investment Group, from what source are you getting this information from?

Oct 07 11:40 PM

[Slvrizgold:]

ANALysts are not gold bugs, you are correct. They are either idiots or paid propaganda shills for the firms they work for, who seek to churn your portfolio and have you buying the crap they sell. I need ANALysts about as badly as I need another hole in my head.

Oct 07 11:56 PM

[Slvrizgold:]

Over 50% of my portfolio is in precious metal related investments as has been the case for several years. I have no complaints! In fact I am the only person I know who is richer than I was a few years ago! In fact, I am looking forward to buying all the decent assets that Bespoke Investment Group clients will be dumping in the climax bottom that should occur in the next few years once the currently successful reflation fails... Can you say, "I just sold some gold at $5000 and sold some gold miners that were up 10,000% and bought a crap load of shares of Coke or Philip Morris at 20 year low?" That's my plan!

Oct 08 12:04 AM

[MarvinMBA:]

I wonder who these analysts are??? Who are they because most analysts now suggest 5 % of you portfolio in gold!! The analysts must be the Fed printing money and trying to downplay real currencies both gold and silver. MarvinMBA

Oct 08 01:03 AM

[MarvinMBA:]

If you believe this I have the Booklyn Bridge for sale and you can pay with paper...hows that??? Incidently I notice there is NO author to this write up...where is he or she???

Oct 08 01:05 AM

[Laurence Hunt:]

I see the analysts have no friends on this page. No wonder I guess. I like the argument that they are writing for a Wall Street-oriented market, and of course gold just doesn't produce anything, even a dividend. Perhaps we could argue that the product of gold is desire (for security, prosperity, a better life, a sound sleep, what have you), and that the product of the gold mining companies is gold. We all know the analysts don't get it, so it's interesting to speculate about the mindset of those that are hiring them. The inevitable conclusion: Wall Street isn't done making bad decisions....

Oct 08 03:22 AM

[coldcall:]

Analysts? Who cares!

They have got it so wrong over the last few years its almost laughable. In fact i rate the average private investor as far more knowledgable, prudent, and realistic than the majority of mouthpiece analysts who have become an embrassment to the human race.

Private investors who only put their own money on the line get it right more often than the Wall St doofus brigade.

Oct 08 04:48 AM

[Jake2:]

"gold analysts across Wall Street"
Might as well be talking about the bogeyman. Very unprofessional work.

Oct 09 12:55 AM