Inflationary economic policy across the global may send gold up to $7,000 an ounce, says Egon von Gruyerz, founder of precious metals investment and storage company GoldSwitzerland.com.
While the precious metal reached a record high of almost $1,250 in May amid Europe’s debt crisis, the real move for gold has yet to come, von Gruyerz told CNBC.
"Adjusted for real inflation, the 1980 gold peak ($850) corresponds to around $7,200 in today’s prices,” he said.
“Gold is likely to make a top in the next few years between $5,000 and $10,000.”
The precious metal isn’t overbought, von Gruyerz says.
"There will be nowhere near sufficient gold to satisfy demand at current prices.”
Loose monetary and fiscal policies, designed to ensure economic recovery around the world, will debase currencies and spark inflation, he says.
"Gold reflects governments' deceitful actions in destroying paper money. At certain points gold is a commodity. Right now it's money."
Governments and central banks don’t know any better than loose fiscal and monetary policy, von Gruyerz says.
“The consequences are clear: Inflation, hyperinflation, economic and human misery as well as social unrest."
Investors who want gold but are worried about the risks of a decline by the precious metal may want to consider buying call options on gold exchange-traded funds (ETFs).
"That’s a way of buying exposure cheaply," Alan Lancz, a Toledo, Ohio money manager told the Wall Street Journal.
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