Fade Goldman’s bearish gold call

By Tim Iacono
Iacono Research

Tim Iacono

The latest research note on gold from investment bank Goldman Sachs — in which they see the gold bull market coming to an end in the months ahead — might be taken much more seriously if not for two factors:

1. The call is based on a vastly improved U.S. economy next year that leads to higher real interest rates and they haven’t exactly been knocking the ball out of the park lately in their economic forecasts.

2. The firm has a reputation for telling investors to do one thing and then betting against it, as many (some in Congress) believe was the case with subprime mortgages as the housing bubble peaked.

In a private note that was widely reported at various internet sites, Goldman commodity analyst Damien Courvalin cited the underperformance of gold this year despite a host of positive factors and then offered this forecast for next year:

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