Robert McEwen, one of the gold’s industry’s most unabashed bulls, is predicting prices could surge as much as 44 per cent by the end of the year as confidence in the economy buckles.
The metal could trade in a range of US$1,700 an ounce to $1,900 by the end of 2016 as uncertainty builds around the stability of global currencies and sovereign debt, said McEwen, who’s so enamoured by bullion that he’s founded two producers: McEwen Mining Inc. and Goldcorp Inc. Record-low global interest rates will cause a “huge amount of anxiety” for investors, who will turn to gold as a store of value and an alternative asset, he said.
Gold “is a currency that doesn’t have a liability attached to it,” McEwen said in an interview at a gold conference in Colorado Springs. “A store of value that has gone for millennia. And the big argument against gold used to be it costs you money to store it. Right now, it’s costing you money to store your cash.”
In New York, gold futures for December delivery settled little changed at $1,318.20 on the Comex. Prices have climbed 24 per cent so far this year, this biggest gain for this point in the calendar since 2011. Bullion’s 2016 rally comes after three straight annual losses. Prices have slumped 31 per cent since reaching an all-time high of $1,923.70 in 2011.
McEwen is betting big on gold. As the chief executive officer of his eponymous company, he’s paid $1 a year and doesn’t receive bonuses, wagering that his share holdings will reap him ample rewards. He’s doing this at a time when many gold executives have expressed caution over the metal’s recent rebound as the wounds still feel fresh from the bear market that started in 2013.
