'Silver could hit $150/oz, gold $2000'

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• Cycle theory forecast for 2012 and the years ahead
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In this exclusive interview with Rob McEwen, former CEO of Goldcorp and current Chairman & CEO of US Gold, discusses about Gold and Silver markets. With the gold and silver markets still experiencing turbulence,

we asks him when he expects a gold explosion coming?

McEwen responded, “Yes, that’s where every market goes (a mania). It just runs and buyer behavior models kick in where you reject the story outright, then you start to accept it and then you go, ‘I have to have it.’ We are looking at a lot of people (entering) this sector. It’s terribly under-owned, under-represented in most portfolios and when people start putting a little bit of gold in their portfolio, you are going to see big changes in the prices of gold stocks.”

Rob McEwen continues, “I take the stance that there is more money being printed by, not only the Federal Reserve, but all of the governments of the Western world because they are adopting the path of least resistance politically. That is to print money, rather than confronting the debt we have in the system that need to be eradicated.

Whenever you have seen that throughout history, when the government decides to debase the currency, people go to the hard assets, the proven performers, such as gold and silver, as a way of protecting their wealth. And we haven’t seen that yet.

Just a small part of the population is putting money there. But when they do (rush in), you will see a very large run. This is definitely a great entry point (for mining shares), in my mind. We could well be seeing the end of those low prices, (meaning) much higher prices in the future.

And it’s really a mix of your portfolio because most people aren’t going to all in to one area. I may be a little unusual in that I’m taking a tact that I see a place where you’ll want liquidity in the marketplace and so you want gold bullion and you want Gold stocks.

But I see the course we’re on is going to Lead to inflation and that’s going to lead to big problems for a lot of people.

“So you want to have something that’s going to move with inflation and that will protect you from the ravages of inflation and that’s where I say you go into gold.

I see gold continuing its climb upwards. At the end of ’11 it got hit and I think it was primarily due to profit-taking. People were looking for liquidity and gold had driven some of the biggest gains and it was an easy investment to take your profits in. The question is going to be asked, ‘Where do I put my money? How do I protect my capital?‘ And that’s where gold shines very brightly.

Gold & Silver are gathering strength. They are building. They are going to take a run, particularly gold is going to take a run at that $2,000 number this year, and then it start’s moving.”

When asked about silver specifically?

McEwen stated, “Well, I was just thinking about silver. It does have an industrial component to it, but there is a growing demand. It’s just easier to get into, there’s a lower price point. That’s why I see silver being an exciting area to have exposure. Silver could eventually be from $150 to $300.”

When asked about people losing faith in the system?

McEwen responded, “Absolutely, they are looking at the numbers that are coming out, being issued by governments around the world and they are wondering if they are correct. We have low rates of inflation, but you can see the price of food has gone up, the price of fuel has gone up, energy. They aren’t jiving. People are saying, ‘Someone is not telling me the truth and so I better take matters into my own hands and look out for myself because my government isn’t.’ That’s true throughout the Western world.”