America’s most trusted investment resource.
Blanchard Economic Research Unit (BERU)
Blanchard and Company, Inc. is pleased to announce
that we have reconstituted our Economic
Research team. The research being
done for Blanchard and Company, Inc. will be headed up
by Blanchard and Company, Inc. Chairman and CEO Donald W. Doyle, Jr.
and Neal R. Ryan, VP and Director of Economic Research.
Should you have any questions, comments or
suggestions for our Economic Research team, please
email them to BERU@blanchardgold.com.
Blanchard and Company, Inc. Sees Five Factors Driving
Gold Higher in The Coming Months
Based on research compiled by Blanchard’s
Economic Research Unit (BERU), we see gold’s ascent
continuing due to:
- Central Bank Sales and Producer Dehedging
Slowing central bank sales and the reduction of
hedge positions by producers (dehedging) are creating a
solid floor price for gold.
- Chinese and Asian Markets
Gold ownership for Chinese citizens was legalized
in 2004. Once a system for selling bullion to the largest
population in the world is up and running, the effect on
gold demand will be staggering. Meanwhile India, already
the world’s largest gold purchasing country, is experiencing
an 80% growth in gold investment following a loosening of
trade restrictions.
- U.S. and Global Macroeconomics
Ongoing inflationary pressures, the massive U.S.
trade deficit, and the move away from the dollar as the global
reserve currency will all work in favor of higher gold prices.
- Gold Mining Production
Nearly every major gold producer missed their
production targets in the second and third quarters of 2005.
As a result of mine strikes and increasing production costs,
global production is continuing to sag and shows no signs of
reversing this trend in the near term.
- Investment Demand
The World Gold Council reported a 56 percent rise
in gold demand in the third quarter of 2005 compared to
the same period in 2004 and a 7th straight quarter of total
increased demand.
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