It took me a while to read the whole thread and find it is interesting to see the calculation for the fair value of gold.
But please bear in mind in the really world fair value is only a 1% or one point chance at which the real price will touch; the rest 99% of the time the real price will not equal to the fair value.
So go back to the basic, we have to look at supply and demand: Supply of gold is very limited. Just ask yourself, when is the last time you heard there is a new million-ounce mine found? But on the other side, Fed can print as many USDs as they like. Supply of USD is unlimited.
Just one interesting point, I read one chinese article about the gold price last week, a really really long one (in Chinese, doesn't make sense for posting it here). The conclusion is POG will run for the first half of 2010 and the second half year it depends on the recovery of USA economy.
