Quote:

Gold could go up 30-40% from here: Puru Saxena
8 Oct 2009, 1809 hrs IST, ET Now


Puru Saxena, Chief Executive at Puru Saxena Wealth Management told ET Now this morning that people are losing confidence in paper currencies and

that this is driving lots of investors towards gold. Here is what he told ET Now.

Where do you think gold will go from here?
People have to understand why gold is going up. Gold is going up because investors are losing confidence in the paper money system. This is a distrust towards paper currencies, Central Banks all over the world are printing money like there is no tomorrow. They are recklessly diluting and debasing the purchasing power of money and thus why we are seeing fund flows going towards gold and I suspect that we could go up 30% or 40% perhaps even 50% over the next six to seven months.

And do you think the force of liquidity will be very strong into buying gold at this juncture, what will drive interest given that there is a global weakness that we are seeing in a dollar right now?
Well, we think is going to be based on investment flows when anything goes to a new high it obviously attracts attention. Gold has recently broken out to a new bull market high. It has gone past 1033, today it is up again in Asia. We believe that we are going to see strong money come into this market. Over the next few months seasonally we are now in the strong time of the year for gold and silver.

We are sticking with our positions in gold, silver and mining equities. We think that we are going to see a huge value over the next few months perhaps going into March-April next year when we could see a big spike in the price of gold and silver and that’s when we will consider booking process but for now we think gold still has further to run.

Is a concern or inflation also a driving interest in the commodity?
Absolutely, as I say the governments are printing money they debasing the value of the currencies all over the world. This is not just happening in the US, although the central bank want to keep their inflation going, they want to keep asset prices going up and the result of all of this will be that the purchasing power of money is going to go down.

It has been going down for years on years and this trend is just accelerating and people all over the world are realising that paper money is not as sound as it used to be and they are getting out of paper and they are buying hard assets. They are buying gold. Gold is not anyone else’s liability once you own, bars of gold or coins of gold you can store them in a safe and if a bank goes bankrupt it does not matter and I think this is what we are seeing today distrust in paper currencies.

At what level do you see gold from here about six months down given the kind of interest that’s coming in the for the commodity?
Well, we think we could hit 1300-1400 dollars an ounce by next March or April. This is based on the seasonal tendency of gold to rocket high between October and March-April time. Since the bull market began in 2001 the price of gold has rocketed higher every two years, in 2007, 2009 and 2005 and now we are on time seasonally, we are in the strong period so we could see a huge run up going up to 1400 or so by next spring.

Economic Times

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Wiccan_Seeker said:

When did the US start printing money like there is no tomorrow? Why after september 11, 2001, just about.

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