Gold Will Fall Back to $1,000/Ounce by 2015 - Dr. Doom (GLD) (IAU)

Gold ended the session lower amid bearish comments from New York University economics and international professor Nouriel Roubini (sometimes known as Dr. Doom).

In an op-ed over the weekend on Project Syndicate, Roubini issued five reasons that gold will slip back to the $1,000 per ounce level over the two years. The following is a brief list of some of the points:

• Gold prices tend to spike when there are serious economic, financial, and geopolitical risks in the global economy.
  
  
• Gold performs best when there is a risk of high inflation, as its popularity as a store of value increases.
  
  
• Gold does not provide any income, unlike other assets.
  
  
• Gold prices rose sharply when real (inflation-adjusted) interest rates became increasingly negative after successive rounds of quantitative easing.
  
  
• Large governments might decide to dump some of their large gold holdings as bonds become less risky.
  
  
• Some extreme political conservatives, especially in the United States, hyped gold in ways that ended up being counterproductive...given the absence of any conspiracy, falling inflation, and the inability to use gold as a currency, such arguments cannot be sustained.

Whether you buy into Roubini's theories or not, the piece is worth a read.

Closing higher on the session was SPDR Gold Shares (NYSE: GLD), iShares Gold Trust (NYSE: IAU), and Market Vectors Gold Miners ETF (NYSE: GDX).

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