Nouriel Roubini Remains Bearish On Gold

A post by Joe Wiesenthal of the Business Insider sums up five reasons why Roubini is execting a gold drop. Most of them relate to the U.S. dollar recovering from its recent decline. Roubini's capstone argument is that there is no ramp-up of inflation on the visible horizon.


To the contrary, market letter writer Howard Katz argues that the prospects for gold are bright, and that a descent to US$1000/oz represents a real buying opportunity. His call assumes that money velocity will eventually return to more normal levels, bringing a spike in inflation. Roubini, of course, believes that the current low velocity of money is the new normal, or at least will stay stuck on low long enough to give the Fed ample time and opportunity to drain the monetary base to more normal levels.