As confidence in the economy grows shakier every day, bulls predict that gold products will surge again by year’s end. Renowned Canadian businessman Robert McEwen went on record yesterday with his prediction that prices could rise as much as 44 percent by the end of 2016. This would make the price almost $1900 per ounce.
No Change in Interest Rates
The price of gold rose again today after the Federal Reserve made no change in interest rates. Coupled with the looming United States Presidential election, the low rates are causing investor anxiety. This will most likely continue to drive the price of gold products and other precious metals higher.
McEwen is the Chairman and CEO of McEwen Mining, Inc. and Chairman of Lexam VG Gold Inc. He spoke at a gold conference in Colorado Springs earlier this week, sharing his argument for why gold will continue to rally. He stated that gold has no liability attached to it, unlike other currencies. While many argue that it costs money to store gold, McEwen counters that, “Right now, it’s costing you money to store cash.”
McEwen definitely stands behind his prediction. He receives a salary of only $1 a year with no bonuses, placing all his bets on the performance of his share holdings. His past predictions paid off—he offered the same outlook in both 2009 and 2011, the last year that gold experienced gains until now.
Many Experts Agree That Gold Products Will Rally
So far in 2016, gold prices have risen 24 percent. McEwen’s prediction is bold, but not too far off from others. A common prediction among experts and billionaire investors is that the price will fluctuate between $1700 and $1900 per ounce. As uncertainty around sovereign debt, global currencies, Central Banks and the U.S. Presidential election continues to grow, it makes perfect sense to hedge investments with gold.