Mining sites are already reopening.
Kingman Minerals Ltd. has been preparing operations on a historic mine site in Arizona.
Kinross Gold Corporation is hoping to benefit not only from renewed investor interest in gold but also from the mineral’s applications in medical testing.
Hecla Mining Company has been expanding from silver into gold and has renewed operations in Quebec.
Here is the problem for the industry but a gain for investors.
Months of shutdown will affect many mining companies’ output for years to come. In the meantime, demand is doubling down as industries build new capabilities that require more metals.
This is why while Bank of America recently raised its 18-month gold-price target to $3,000 an ounce, Billionaires like Thomals Kaplan believe that gold is on the cusp of a new decade long bull market that will push the price well past $5,000 an ounce.
Kaplan, chairman and chief investment officer of Electrum Group, said that because of economic fundamentals gold prices could rally as high as $3,000 to $5,000 within a decade.
He further explained that there are two possible scenarios.
In the first, gold has already broken out and, as Jeff Gundlach puts it, “is coiling like a snake for its next move to take on the old highs.”
In the second scenario, gold could take one more head-fake to the downside, “just to shake out the weak hands.”
He said that he believes gold embarks on the next leg of its bull market and goes past $1,900 and ultimately $3,000 to $5,000, if not a lot higher, depending on macro circumstances that today seem dim but he can’t really quantify.
Kaplan made his billions by looking at things long term and this is no exception.
The first move, the first leg in gold took gold from $250 to $1,900. For 12 consecutive years, gold was up every single year whether there were inflation fears or deflation fears, strong dollar, weak dollar, political stability, political instability. It didn’t matter.
That to him is a bull market. We’ve now been in a correction which has taken gold from $1,900 back to where we are today. You could easily see gold fall a couple of hundred dollars before going up a couple of thousand dollars.
But each move has been a decade or more, which means that when gold embarks upon its next move, we will see that long wave take gold relatively quickly, but it will be measured in years, to the three to five thousand dollar target.
Well, he didn’t become a billionaire slacking around.
Imagine being a decade or so away from retirement and investing now. Gold is still flirting around the $1800. By the time you are up for retirement, you are looking at more than 150% gains.