Wednesday, July 11, 2012

Erste Bank - Sixth Annual ‘In Gold We Trust’

Our good freind Ronald-Peter Stöferle, CMT, CFTe, of Erste Group Bank AG in Vienna has released Erste Bank’s sixth annual very comprehensive research report on gold entitled “In Gold We Trust.”  The entire 120-page report is available in PDF format via a link at the end of this notice. 

Ronni writes in an email introduction to the report: “The foundation for new all-time-highs is in place. As far as sentiment is concerned, we definitely see no euphoria with respect to gold. Skepticism, fear, and panic are never the final stop of a bull market. In the short run, seasonality seems to argue in favor of a continued sideways movement, but from August onwards gold should enter its seasonally best phase. USD 2,000 is our next 12M price target. We believe that the parabolic trend phase is still ahead of us, and that our long-term price target of USD 2,300/ounce could be on the conservative side.

The study is covering the following topics:

· Central bank’s monetary inflation supports progressive remonetisation of gold

· Inflation ≠ rising prices: confusing terminology with grave consequences

· The chronology of a hyperinflation – Explanation based on Peter Bernholz’ “Monetary Regimes and Inflation”

· Gold in an environment of a deflationary loss of confidence

· The biggest misconception with regard to gold

· High stock-to-flow ratio is the most important characteristic of gold

· The advantages of a gold standard

· Financial repression: the alleged magic formula

· Why gold remains (dirt) cheap in India and China

· Excursus on Interventionism - It is a fine line between manipulation and intervention

· On the search for a “fair value” for Gold

· Possible price targets for gold

· Why gold is (still) no bubble

· Gold improves portfolio characteristics The renaissance of gold in traditional finance

· Why is gold such a highly emotional topic? Cognitive dissonance and normalcy bias as possible explanation

· Challenges for the gold miners: Peak Gold and increasing resource nationalism

· Gold shares (still) with historically low valuations”

Our thanks to Ronni Stöferle and Erste Bank for sharing this important, very timely research.

The full report is at the link below. 

Download 20120711 SpecialReportGold2012-InGOLDweTRUST

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Trading gold, silver and mining shares since 1980 with a focus on taking advantage of volatility extremes, Gene Arensberg analyses the markets through a basket of technical and fundamental indicators and shares his findings from time to time here at Got Gold Report. Mr. Arensberg has been quoted in the Wall Street Journal, Dow Jones MarketWatch, USA Today and dozens of other news organizations.

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