TORONTO (miningweekly.com) – Gold may have taken a pounding since the end of February, falling from $1 787/oz to $1 660/oz, but “we have entered the most favourable era for gold prices in our lifetime”, BMO Financial Group strategy adviser Don Coxe said at the weekend.

“The next time that gold really starts to make a run, it’s got nothing to stop it,” he said on a conference call.

Coxe reasons that the amount of money governments in the US, Europe and Japan are printing has led to the highest ratio of gold production versus fiat currencies since paper money was invented.

In the March issue of his Basic Points bulletin, he goes on to say that it is only a matter of time before shares in “the great mining companies” start to outperform the price of their product, echoing his previous view that investors should buy the producers' stock instead of the metal.

Much ink has been spilled over the past couple of years regarding the dramatic underperformance of gold mining stocks compared with gold prices, as investors gravitate towards the less risky exchange-traded funds.

“Governments are running deficits beyond the forecasts of all but the hardiest gold bugs five years ago; central banks are printing money and creating liquidity beyond the forecasts of all but the most paranoid gold bugs a year ago,” Coxe wrote.

Having topped a record $1 900/oz in August last year, the yellow metal has had a highly volatile ride, plunging to as low as $1 540/oz in late January.

Gold, seen as a place for fearful investors to park their money, has suffered most recently after Greece managed to avoid defaulting on its debt, and the US Federal Reserve signalled another round of quantitative easing is not immediately around the corner.

Also, last week, Aurizon Gold CEO George Paspalas expressed similar sentiments to Coxe.

Speaking in an interview, he commented that things had "not changed overnight in Europe".

"There is so much uncertainty out there...there's nothing that anyone is really willing to hang their hat on," he said when asked for an opinion on the recent weakness in the gold price.

"I'm pretty bullish on gold."