Monday, September 5, 2011

CNBC: Silver Could Reach $600/oz, Gold $6,000/oz by end of Bull Market

The Doc just did a triple take at this morning's CNBC headline stating gold could reach $6,000/oz and silver $600/oz by the end of the bull market.
It's Labor Day and I'm reading about the gold/silver ratio of 45:1 tightening to 6:1 before the end of the bull, about silver's long term supply deficit, and about the gold/silver bull market to be the bull that ends ALL bull markets...and I'm not reading Ted Butler or Jim Willie, I'm reading CNBC!

See what happens when you head to The Hamptons for a long weekend and leave your assistant editor in charge of your site? 

Silver Set for 14-Fold Price Rise? Gold prices may reach $6,200 per ounce in a bull run which will “end all major bull markets,” Urs Gmuer, asset manager at Dolefin, a Swiss investment advice firm, told CNBC.
In addition, Gmuer said silver is set for an even greater upward run than gold, with the market due to correct a distortion in its pricing of silver in relation to gold.

Gold and silver currently price at a ratio of around 45:1. However, Gmuer said declining silver output over the last 60 years—as a result of inventory depletion and mine closures—meant silver supplies currently outnumber gold by a ratio of less than 10:1, thus indicating a market correction is due.
Once this occurs, Gmuer said silver prices would settle at 6.7 percent to 10 percent of gold prices. This implies that if gold reaches $6,200 per ounce, silver could peak at $620 per ounce.
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