About six months ago, Citibank, Bank of America, and I think Goldman Sachs were coming up with what they were calling,you know, I'm quoting them…”a new way to model gold, the new gold model, how to value price in gold.”
Well BOA just launched it, CITI will launch next. By the time election time comes around, bullion banks that are players will all have competing ”models”.. The question is, are they late or still early in figuring it all out?
Meta-Analysis of BOA’s Reasons to Buy in Context
Excerpted quotes:
All right, a little insight, a little observation, a little in-depth commentary on the report that you were just sent and that we just wrote up.
…that means it's not early, it's late. But it's not necessarily wrong, okay?
…to tell people to buy gold because central banks have already bought it implies that you think they will keep buying it. I'm not so sure they will keep buying it as aggressively as they have, number one.
…this is the type of report that you're going to see in the mainstream media soon. So look for it…
The Three Reasons to Buy Gold
From BOA: West's Turn to Buy The Gold Coming
1- Gold is the Consummate Hedge
Gold has the lowest correlation to the S&P 500 of almost any asset class and can act as a haven if inflation reaccelerates or growth slows later this year
Related: **Hartnett Loves the Gold...really
2- Central banks have been hoarding gold like never before
The second reason to be bullish is that central banks are buying at an unprecedented pace: >2,100 tons in the past two years
3- The first rally that mom & pop investors have missed
This is the third major gold rally in two decades. The first two (2004-2011; 2015-2020) saw big inflows to gold ETFs. But households have missed this rally: total ETF gold holdings, a proxy for investor demand, have fallen by 25%, implying a price around $1600-1700
