One of the Best Gold Watchers

This note is a guest contribution by Frank Holmes, CEO, CIO, U.S. Global Investors.

Pierre Lassonde is one of the smartest people in the gold world, and he has the track record to prove it.

He’s a former president of Newmont Mining, the world’s largest gold producer, and was chairman of the World Gold Council. His achievements aren’t all in the past – now he’s chairman of Franco-Nevada Corp., the most successful gold royalty company.

I’ve known Pierre for years, and have learned that when he talks about gold, it makes sense to listen.

In a recent interview with Mineweb.com, Pierre said gold sector investment is still in its early days, and it will continue for at least five more years.

His reasoning is similar to some of the things we have been saying for a while:

• Gold can provide some protection against currency debasement as governments try to inflate away their massive sovereign debt burdens;
• A rising middle class in China, India and other countries that value gold is a key demand driver for both jewelry and gold as an investment;
• China’s appreciating currency will make U.S. dollar-denominated products (including gold) cheaper for Chinese consumers.

Of course, the interviewer asked Pierre to forecast the price of gold.

I believe in two things.  One is that the gold price will have three zeros after the first number - I just don't know how big the first number is going to be.  We are now at $1,200 gold and I do not believe for one second that that's the end of the bull market in gold… The U.S. politicians have absolutely no guts for another depression and they will always allow the printing press to run to answer their problem and therefore when I look at the long term gold price - very bullish.

Read Pierre’s Interview with Mineweb’s Geoff Candy

By clicking the link above, you will be directed to a third-party website. U.S. Global Investors does not endorse all information supplied by this website and is not responsible for its content. The following securities mentioned in the interview were held by one or more of U.S. Global Investors family of funds as of June 30, 2010:  Barrick, Newmont Mining, Franco-Nevada.