Goldman Sachs Predicts Gold To Hit $1650 Within 12 Months

Banking on a debased currency, continued printing of money out of thin air
Steve Watson
Prison Planet
Oct. 13, 2010

Goldman Sachs expects the dollar to plummet following another round of quantitative easing and has raised its forecast for the gold price to $1,650 per ounce within the next 12 months.

The announcement came in a report, Monday that stated:

“With the prospects for another round of quantitative easing in the United States increasingly strong, US real interest rates continue to fall. With 10-year TIPS yields now below 50 bps, we expect gold prices to continue to climb, and we are now raising our 12-month gold price forecast to $1,650/toz. We also recommend opening a long Dec-11 COMEX gold position.”

The move translates to a forecast revision of more than 20 percent, with the investment bank expecting gold to hit $1,400/toz, $1,525/toz, and $1,650/toz on a 3, 6, and 12 month horizon.

“The return to quantitative easing will likely be a strong catalyst to drive gold prices higher, and we expect the gold price rally to continue until US monetary policy begins to tighten.” the report read.

Goldman has consistently lobbied the Federal Reserve to initiate a second round of QE, (to you and I that means central banksters creating money out of thin air) fully acknowledging the long term weakening effect this would have on the dollar.

The Goldman report also stated that gold could rally for an “extended period,” suggesting that it could take until 2015 or longer before an interest rate hike becomes “appropriate,”.

The bank noted that it expects the Fed to announce upcoming QE measures in the first week of November at the scheduled Federal Open Market Committee meeting.

“We see this acting as a strong catalyst to carry gold prices to the higher levels that we now forecast.” the Goldman report stated.

Following the announcement, gold climbed for a second day, hitting $1,348.88 an ounce while silver advanced 0.3 percent.

Futures for the yellow metal are now up by an incredible 20 percent this year, putting it on course for a 10th consecutive year gain, the longest surge the metal has seen for some 90 years.

Gold still has the potential to make more huge gains, as highlighted by the fact that today’s prices are still way off all time highs, recorded in 1980, of close to $2,185 an ounce measured in dollars adjusted for inflation.

Should rampant inflation occur, caused by out of control money printing, and initiate a full blown dollar crash, experts such as Omnis senior managing director James Rickards predict that gold prices will soar beyond anything imaginable.

Rickards recently forecast that the precious metal could reach anything up to $11,000 in the aftermath of a dollar collapse.

As Jim Rickards explained during a recent CNBC interview, forecasts for gold to hit $5,000 an ounce are entirely realistic, given the fact that if the gold standard is reintroduced, it will have to be set at an accurate inflationary level against the dollar:

The dollar continues its downward spiral this week, hitting a new 15-year low against the yen and trading at a near eight-month low against the euro on speculation the Federal Reserve will buy $1 trillion of government debt.

All of this is providing a pretext for the introduction of a new global currency, the cornerstone of a new centralized globalist order. This is not the stuff of paranoid conspiracy theory, it is written into the IMF’s own strategy documents.

Reports have also suggested that the Fed, via its subsidiaries such as Goldman Sachs and JP Morgan, are shorting “paper gold” while at the same time buying up exclusive rights to producers' future physical gold production in an effort to keep a precious metals ponzi-scheme alive.
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Steve Watson is the London based writer and editor at Alex Jones’ Infowars.net, and regular contributor to Prisonplanet.com. He has a Masters Degree in International Relations from the School of Politics at The University of Nottingham in England.