Where will Gold price go?

Answer: $10,000/ounce, but it's just a matter of when.

No, didn't come up with this number. The number is forcasted by Alf Field in the article "Elliot Wave Gold" (at http://www.gold-eagle.com/editorials_08/field112408.html)

I didn't believe in my eyes when I first saw this number. I talked to myself: "No way the gold would be so high". But the more I study the situation the world economy is facing, the more convinced I am that there will be someday gold reach $10,000 an ounce.

So why it could be so? Why gold can reach this high? The answer to this question lies in one world: Confidence.

No, for decades, people live with paper (fiat money), stocks and all kinds of financial (paper) assets. All of them are inflated and overpriced and the peak of them is around the year 2000. But from 2001 until now things are getting worse, more and more people realized that the financial assets they are keeping evaporated. In other words, invertors are losing confidence in paper assets. And when investors are losing trust in paper assets, they will turn to cash and Gold is the King of all cash. Gold is the utimate of cash for thousands of years in human history.

As I discussed in the post about the Dow/Gold ratio, in the end this ration will reach 1. Now Dow is around 9,000 and gold is around 940 (i.e. the ratio is 9.5). There are 2 possibilities here: either Dow will go down and gold will go up. But the possibility that Dow going to 940 is nearly imposible. So I believe Dow will go down half way through and Gold will go up and they will meet each other at 5,000 for Dow and $5,000 for Gold. Just a matter of when. I believe this will happen in the next 2-5 years. I will dicuss about the timing for this in another post.