Scary of gold forecasts by Jim Rogers, Marc Faber?

By Jim Sinclair
The gold bears are out today as the aired 2010 predictions are being issued by talking heads.

Some pro-gold stars like Mark Faber and Jim Rogers are being interviewed every day and are predicting a dollar rally. That is scary to those that have followed them and is making them emotional.

This is the end of the year and there isn’t a market for much right now. There is profit taking on gold spreads as taxes on commodity trades as regular income are anticipated to rise meaningfully in the near future.

The ease in the US dollar is being considered as yearend as most predictors are friendly to the dollar short term.

The London markets are closed today

In the grand scheme of things this period is quintessence in its meaningless nature. Stay the course.

Following are the gold-predictions from Jim Rogers, Marc Faber, and Nouriel Roubini:

Marc Faber
In the 1980s the US Dollar was a very strong paper currency compared to the Mexican Peso. Today, there is no paper currency that is as strong relative to the US Dollar as the US Dollar was relative to the Peso in the 1980s! The only "currencies" that have a chance of becoming as strong against the US Dollar as the US Dollar was against the Peso between 1979 and 1988 are precious metals such as gold, silver, platinum, and palladium.

According to Dr Faber he is buying lots of gold exploration stocks and gold producers because their prices were ridiculously cheap. Dr. Faber, who wrote the best-selling book Tomorrow’s Gold and has long been a holder and proponent of physical gold as a hedge against inflation says gold stocks are the best bet against global financial meltdown.

Jim Rogers
Jim Rogers, co-founded the Quantum Fund with George Soros, who is now settled in Singapore believes that there is no sense in China’s fear of a gold bubble. Rogers has already predicted that gold will zoom to touch $2000 per ounce. He says gold consuming countries like China and India, central bank buying and declining dollar value are driving up gold prices and therefore, gold is not sitting on a bubble.

Investment legend Jim Rogers says that the recent sharp increases in commodity and stock markets don’t constitute a bubble. “The only bubble I see forming in the Western world is in the U.S. government bond market,” he told Bloomberg. “Other than that I don’t see any bubbles going on.”

Nouriel Roubini
Much has been made of the Nouriel Roubini/Jim Rogers Bear vs Bull Battle in the last few days. It’s obviously a media fuelled debate. Apart from the definition of a “bubble” and the price of gold, I’m pretty sure these guys are investing in the same things: Emerging economies and commodities.

It’s not surprising that the likes of Jim Rogers and Nouriel Roubini disagree on a great many aspects of the economy. They are the standard bearers for multitudes of the Bulls and Bears, respectively; they are expected to pontificate within a relatively predictable line of reasoning.

What’s surprising is the degree to which the viewpoints appear to have have diverged. On one hand Rogers is saying gold will top $2,000, possibly go even as high as $10,000 per ounce during this bull market. In a follow up article, Bloomberg quoted Roubini as saying the idea of gold going to $2,000 per ounce was “utter nonsense”. Maybe $1,100 or so, says Roubini, but that’s about it.