High inflation is coming

From Richard Russell’s newsletter comes this gold forecast of Ian McAvity:

“I don’t do specific forecasts in my work, but I think there’s a prospect of gold pushing into the $2,000 to $2,400 range this year or perhaps in 2012. This presumes an element of monetary panic relating to the US dollar or the euro during the year. A gold price of $2,400 would the CPI-adjusted equivalent of 1980′s $850 in current dollars, so this is not an unrealistic number.” Quote from Ian McAvity. My old friend, Ian McAvity has been writing Deliberations on World Markets since 1972. Ian is a founder of Central Gold Trust of Canada (CEF) Central Gold Trust (GTU) and Silver Bullion Trust (SBT-U).

Everybody is entitled to their opinion. That does not mean you should believe it. McAvity, however, is usually pretty well-reasoned.
I don’t know where gold is going. I don’t believe it is a bubble, at least one that is about to burst, because bubbles generally have blow-off tops. Nothing like this has happened yet.
Given that I believe the dollar is going to approach zero in purchasing power, why wouldn’t gold go up almost infinitely? It could.
These are difficult times to project, at least short-term. If you are interested in gold or hard assets, be prepared to be whip-sawed. There is always the danger of a 25-30% correction or explosion.
Gold is not for the faint of heart and probably not a trading vehicle except for those who are nimble and experienced in such matters. It is likely a good long-term hold as a store of value for a portion of your portfolio if you think high inflation is coming.
If you expect the dollar to deteriorate, you must protect your purchasing power outside of the dollar.
Markets report; you decide but only after consulting trusted advisors who know your particular situation.