Metals Analyst Backs Gold After 2 Years Of Bearish Forecasts
NEW YORK -- A prominent longtime bear on gold is turning bullish.</br></br>Gold hasn't appealed to many investors lately in the current low-inflation climate. The metal is trading at less than half its 1980 highs, and its 9% price gains since New Year's have been dwarfed by rallies in the stock and credit markets. "Gold just sits there" in comparison with other investments, says William O'Neill, research director at Rudolf Wolff Futures Inc., New York.</br></br>Nevertheless, after two years of bearish price forecasts on gold, Jeffrey M. Christian, vice president of the commodity research group at Goldman, Sachs & Co., New York, last week recommended buying gold. He asserts that tightening supplies and cyclical changes in the U.S. economy will fuel a gradual, prolonged surge in gold prices over the next several years.</br></br>"The time has come" to start buying gold again, Mr. Christian said at a Goldman Sachs gold seminar last week.</br></br>Jeffrey A. Nichols, president of American Precious Metals Advisors, is another optimist. "Rising investor interest could give gold a sharp, swift kick to higher levels," he says.