We are speechless. Just speechless.
JP Morgan's Colin Fenton has just released an updated outlook for gold following the US downgrade to AA+ by S&P Friday.
JPM now calls for gold to hit $250 by year end...yada, yada...Nope.
JPM has revised their outlook for gold by end 2011 to....wait for it..... $2,500!
Now, either Blythe and Dimon are currently dialing up a hitman for one of their own employees, JPM is actually now expecting gold to decline into end 2011 (not likely with QE3 on the way), or else is it possible that JPM realizes that the end-game is imminent, has reversed course, and is now LONG GOLD!?!
We welcome our readers' thoughts.
"Gold and sugar have potential to run a lot higher. It has been clear for weeks that the prompt CMX gold price has been building in a rising probability of a reflaring of financial crisis, gaining by 9.7% since June 30 as the MSCI World Equity index dropped by 10.1%. The correlation in daily price changes between these two assets has dropped to –0.09 from +0.29 over the prior year. Gold’s correlation against TIPS has doubled to 0.35 from 0.18. Against Italian and Spanish 5-year sovereign CDS prices, the gold correlation has moved to 0.27 and 0.32, from 0.07 and 0.04, respectively. Before the downgrade, our view was that cash gold could average $1800 per oz by year end. This view will likely now prove to be too conservative: spot gold could drive to $2500 per oz or higher, albeit on very high volatility."