By Richard Wachman.
PRECIOUS metals cycle forecaster Bo Polny is always good value and his appearance at Mines and Money this year proved to be no exception. By Richard Wachman
He said gold was heading for $US2000/oz in 2015 “as we first encounter an inflationary spike (as early as January) and then a deflationary crash that will see a painful correction in equity markets”.
The yellow metal was a classic deflationary hedge on an equity correction, said Polny, using a slide show to illustrate how the cycle was about to turn. In theory, gold could go to $5000/oz in seven years and silver to $500/oz.
“What’s more, gold and silver, specifically silver, are trades of a lifetime right now.”
Polny explained how there was a 21-year cycle, a seven-year cycle, a 70-month sub-cycle, “take it back 250 years to 1764 and there are … immutable patterns, if you like, of cycles”. Make of that what you will, but the audience loved every moment of it.
And there were some lovely quotes such as: “I’m a cycle person, I don’t understand finance”. Or “cycles precede all technical and fundamental analysis”. Even the Bible was cited as saying, “what has been will be again … what has been done will be done again … there is nothing new under the sun”.
But how are we going to get to $2000/oz?
Said Polny: “Something’s coming, cycle [theory] says there is an event coming. Will it be a supply issue? People know how hard it is to get physical bullion … so something should, could and likely will happen. Gold is going to go vertical into 2015.”
Polny said: “I specialise in cycles. Cycles tell us that life is written and unchangeable.
Anyway … until a cycle is broken, you have to assume it to be real, because if you don’t assume it to be real, you are betting against a cycle and that’s akin to going to playing golf in a hurricane. I don’t care how hard you hit the ball it’s going to come back at you. You can’t bet against the cycle.”
That said, you could bet against Polny. But who would be so bold?
Richard Wachman is news editor of MiningNews.net’s UK sister publication Mining Journal.