By Rob Delaney
Feb. 4 (Bloomberg) — Eric Sprott, whose Sprott Hedge Fund increased more than fivefold in nine years, said gold may rise to $1,500 an ounce this year and $2,000 within two years as the U.S. government takes measures to counter the credit crunch.
“With quantitative easing and the financial problems we have, I suspect that the gold price goes up from here,” Sprott said today in an interview in Toronto, where he announced financial support for Canadian athletes.
“If you tell me how much quantitative easing there is, I’ll tell you where the gold price will go, but I have no trouble imagining we get to $1,500 this year and to $2,000 in two years.”
Sprott said in a Dec. 18 interview that the Standard & Poor’s 500 Index will collapse below its March lows as an expected rebound in economic growth fails to materialize. Gold rose 22 percent in New York in the two years ended yesterday as investors bought the precious metal as a safe haven during the global economic recession.
Gold futures for April delivery fell $44.30, or 4 percent, to $1,067.70 an ounce at 12:01 p.m. on the Comex division of the New York Mercantile Exchange. A close at that price would mark the biggest decline since Dec. 4.
Sprott’s C$1.39 billion ($1.3 billion) Sprott Canadian Equity Fund, which has gained about 18 percent in the past six months through yesterday, has 34 percent of its portfolio in mining stocks and another 39 percent in bullion as of Nov. 30.
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