21-Sep (Bloomberg) — Robert McEwen, one of the gold’s industry’s most
unabashed bulls, is predicting prices could surge as much as 44 percent by
the end of the year as confidence in the economy buckles.
The metal could trade in a range of $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 enamored 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 Tuesday 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 percent 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 percent 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.
This isn’t the first time McEwen, a 66-year-old former investment banker,
has defied his own industry. In 2000, he launched an audacious experiment
when he was at Vancouver-based Goldcorp. Offering $575,000 in awards, he
threw open to the public more than five decades of proprietary data on the
company’s under-performing Red Lake mine in Ontario and challenged geologists
to locate the next 6 million ounces of gold.
