, Firelight Investments CEO LaSund (Pierre Lassonde) said on February 28th that the conflict in Ukraine could be protracted, with oil prices rising further from current levels to $200 if they lasted for two, three weeks or a month. In the medium term, gold will move towards $2200 to $2400 an ounce. Over the next five years, if the Dow shrinks 20% to 30%, the Dow's ratio to gold could converge to 2%, and the price of gold will rise to $10, 000.
He said in an interview that Germany has now changed its strategy and said it will provide military assistance, which has greatly changed the possible outcome of the war. The longer it lasts, the more far-reaching the impact will be, especially for the energy market. If this continues for two, three weeks or a month, he thinks the oil price will reach $200.
Lassund's comments came as Germany announced its plan to supply Ukraine with 1000 anti-tank weapons and 500 surface-to-air missiles as soon as possible, reversing the long-standing principle of not exporting weapons to conflict areas.
Lassund points out that as energy prices rise, so will persistent inflation. "the inflationary pressures we see today are the same as those we saw in the 1970s," he said. From 1976 to 1981, inflation was rising every year, interest rates were rising every year, the dollar was rising every year, and gold was rising every year. This is what we will see in the next four years. "
In the medium term, gold will move towards $2200 to $2400 an ounce, Mr. Lassonde said. In the long run, if the Dow shrinks by 20% Mo 30% over the next five years, the Dow-to-gold ratio could converge to 2:1. That means the price of gold will rise to $10,000.
This has happened twice in history, once in the 1930s and in the early 1980s, when the Dow was trading at 1:1 in gold.
Mr Lassonde said the current 1:1 ratio was too radical because it meant the stock market would have to fall sharply from its current level and a correction of more than 30 per cent was unlikely with central banks creating so much liquidity.
"at a ratio of 2 to 1, plus a 30% correction, the price of gold could reach $10,000," he said. This is feasible. I think it will happen in the next five years. "
(spot gold daily chart)
Spot gold was reported at US $1902.54 / oz at 10: 36 on March 1st, Beijing time.
