Gold has outperformed every expectation so far in 2023 but we could see much, much more from the precious metal over the course of the next 24 months, predicts one industry expert.
Tom Luongo, author of Gold, Goats ‘n Guns sees a powder keg igniting under gold prices – something which could see levels surge to £7,920 ($10,000) as early as 2025.
Luongo bases his forecast on continuing turmoil in the banking sector. The hawkish Federal Reserve rhetoric of recent weeks has the gold expert convinced that rate increases to around 6% are a very real possibility, something that would push many smaller, regional banks into very uncomfortable territory.
He said, “I just see the entire banking system imploding, detonating like a nuclear bomb. You’ve got 20 percent vacancy rates in hot markets like Dallas and Miami. [Smaller, regional banks] are exposed to a lot of commercial real estate… all credit-based assets are going to deflate.”
In addition to the risk of smaller banks going the same way as the failed Credit Suisse, and First Republic, Luongo expects the U.S. dollar to struggle. This would pave the way for gold to more than quadruple in value over just 24 months. While that may sound unfeasible, previous trends show us that it is in fact entirely possible.
“If we look at the 1970s as a model, we are looking at £6,336 ($8,000) to £7,920 ($10,000) in gold minimum, over the next couple of years,” he forecast. “If the dollar collapses on the other side of Jerome Powell, then things could get very interesting for gold and gold investors.”
Luongo has previously proven himself to be on the money when it comes to forecasting Federal Reserve actions, successfully calling for rate increases when most analysts expected policymakers to go the other way.
Don’t wait for the bulls to make gains before you take action. Buy gold now while the price conditions are favourable and set yourself up for long-term success.
