It's not the hot commodity it was last year but gold has been creeping its way back to prominence of late. The yellow metal is once again over $1,700 an ounce, up more than 10% for the year, and well off the lows hit early last summer. With gold in the upper end of the $1,500 to $1,900 range that it has traded in since making all-time highs in 2011, it's a good time for investors to question whether it's time to load up ahead of a potential push to new highs.
Jeff Kilburg, CEO of Killir Kapital Management and CNBC Contributor, says yes. His logic is relatively simple. While gold has been marking time, the Fed has been printing money. Putting the price tag of all the QE's to date at $2.6 trillion, Kilburg says every virtual dollar printed is money in the bank for gold investors.
"The theoretical value of gold when you see that the monetary base grow by another 18.4%, $735 billion it puts gold at $2,000," Kilburg asserts in the attached clip. "I think the way to be invested is to be long the (GLD) [SPDR Gold Trust]."
For those investors who get itchy looking at the way gold reversed at levels not much higher than where we are now, Kilburg says they might consider making a "Najarian style" trade by selling some calls.
Recently gold has been trading close to lock-step with stocks. That's not "supposed" to happen and Kilburg says it won't continue. If markets and gold detach again, the Fed keeps printing and inflation rears its ugly head, $2,000 will be only the beginning.
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