Rick Rule: It’s Happened Only Twice In My Lifetime – Expect Demand For Gold & Silver To Quadruple

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On the heels of the price of gold breaking back above $1,300, Rick Rule told King World News it’s only happened twice in his lifetime but we should once again expect demand for gold and silver to quadruple.

Only Twice In My Lifetime
March 15
 (King World News) –
Rick Rule: 
“The gold market looks attractive to me.  It looks attractive to me in the sense that it’s still not a popular trade but it’s a strong trade…


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Rick Rule continues:  “Twice before in my life gold has been relatively strong at the same time that the US dollar has been strong.  Normally they trade in opposition to each other.  The last time this occurred was 2000-2001.  Both gold and the dollar were strong in 2000, albeit from a weak base.  The dollar eventually rolled over and gold did extremely well.  Will past be prologue?  I don’t know.  But I’m encouraged by the fact that we see US dollar strength, at least relative to other currencies with simultaneous gold strength.

Gold Breakout
Sometimes the price of gold breaks out but it breaks out as a consequence of long periods of accumulation, which is what I think we are seeing.  My own suspicion is that gold drifts rather than rockets higher.  I believe this will happen because the air will be let out of the dollar.  Public perceptions over the long-term purchasing power of the dollar will continue to diminish and the consequence of that will mean some of the money that otherwise would have flowed into US dollar savings products, particularly US Treasuries, will instead flow in to gold.

Demand For Gold, Silver And The Shares Will Quadruple
The current market share for gold and gold related in the United States is between .33% and .5% of investable assets across the country.  In 1981, the similar figure was between 8% and 8.5%.  And the three decade mean is between 1.5% to 2%.  So if we experience mean reversion, that is if precious metals and precious metals related equities across the US savings and investment metrics returns to mean, demand for precious metals and precious metals equities will at least quadruple.  And I think that’s what’s going to occur.  What I think is going to happen is that gold is going to continue to gain strength much like we saw during the period between 1975-1977.”

***Also just released:  Despite Pullback, Gold Lease Rates Flashing Bullish Signal CLICK HERE TO READ.

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