gold forcast of below 800, page-45

Here's something from the latest Barron's confirming the gold and silver craze is over.



Are Gold and Silver Losing their "Disaster-Hedege" Aura?
By John Kimelman

Has America’s obsession with both gold and sliver entered a new, less panicky phase?

Well, there’s no argument that price for both metals have been under pressure since both hit 52-week highs last summer. Shares of SPDR Gold Trust (GLD), the popular exchange-traded fund pegged to the price of gold, is now trading at around 154, a far cry from the 185 it hit last August. Same goes for the SPDR Silver Trust (SLV), which is now trading at 26.53, compared with the almost 43 a share it hit last summer.

Nicholas Colas, the chief market strategist at ConvergEx, sees some sort of fundamental change at work in the way investors view the two metals.

According to Colas, declining gold and silver coin sales figures over the last year from the U.S. Mint “had us wondering if the domestic precious metals craze might be winding down.

“The short answer is ‘Yes’, but it’s far from the early signs of any bursting bubble,” Colas writes.

“Gold coin production at the Mint is running at its lowest point since November 2008, and our conversations with an official there reaffirmed the notion that the government produces all the silver and gold Eagles that the public demands,” he writes.

Morover, Colas, who works in New York, took a field trip to the city’s famed 47th Street Diamond District, where gold and silver are traded along with diamonds. The trip, he said, “confirmed the public’s enthusiasm over the yellow metal is certainly waning, though dealers continue to push its value as an investment hedge.