Updated: 31 Dec, 2006

From the Crystal Ball of Charles Kubach The 2007 Gold Prediction Appears December 31,2006 Well, last year I predicted that gold would finish around $550/oz, but could hit $600 per ounce, if things went well. Things went very well, for gold, and it finished 2006 ay $634, after peaking above $700/ounce. So, I was in the ballpark, actually was off by only 5.7%, not too bad for the old "crystal ball". Next year could be a bit volatile for gold, since everything that makes gold rise, is rising, except the supply (100 ton surplus at the years end), and demand showing weakness at the high price for the shinny yellow metal. However, the Mid East is volatile and is not going to improve any time soon, so the "safe harbor" gold offers will be a major factor in its movement in the coming year. Another important factor is the dollar devaluation, the dollar is expected to weaken further over the coming 12 months, and this always seems so drive gold up a bit. China's economic growth is slowing a bit, they are not requiring as much raw materials as they have in the past couple of years, and this has diminished the iron, steel, and copper prices. Gold, however, is a slippery commodity to pin down, as it has a superstitious value to many, and it has always been a hedge against political turmoil and currency fluctuations that will occur. Gold should fluctuate a bit more next year than last year, both up and down. It will be a traders market, since the most money can be made (or lost) in a greatly fluctuating market, than in a stable one. I would pick $500/ounce for the bottom for gold and $750/ounce as the peak for gold, and will probably spend most of the year somewhere in between these numbers. I do look for gold to finish next year around $700/ounce, though. Silver, the 'other' precious metal, finished the year at $12.78/ounce and should mirror gold in it's rises and falls, probably finishing the year near $14/ounce. Silver lacks the 'superstitious' factor, and does not benefit as much from currency fluctuations and dollar weakness as gold does, so it's rise and fall will depend more upon supply and demand, along with speculation. When the stock market is setting record highs almost monthly, and the dollar heading the other way, gold would be a prudent part of a well balanced portfolio, as a hedge against these two factors going South, too far in the short run. With only 35 or so years of known gold reserves worldwide, the long term prognosis for gold it very good. Those holding gold in 20 years could make more money than Bill Gates did with Microsoft, in all probability, That is unless many World Class Gold deposits are discovered over that time period, and if the last couple of years are any indication, that will not happen. So, as I pop the cork on the bottle of Dom, again I toast the New Years, its promises and potential. Golden 'Cheers' all around.

But that's just my opinion. Charles Kubach Mine-Engineer.Com Return To Gold Page