As we can see, in the past, gold prices fluctuated very wildly (perhaps more than any other commodity) due to the redrawing of political equations and wars. So, what do you think the price of gold will be, say 14 years from now, in 2025? Also, it seems that the gold production from mines is decreasing. Do you think the gold supply will grow along with the demand?
This is why gold is such a great investment, I doubt the supply will grow as hugely as the demand does, I find it difficult to believe it won't rise, and if it doesn't, it'll stay the same. But anything can happen, they might discover that gold isn't cool anymore, heck, they might find an extra million ton of gold in a deserted mine.
Gold doesn't occur that way. Gold occurs in small deposits mixed with a lot of impurities. Million ton deposits are not possible, because even the largest gold mines yield only a few thousand tonnes of gold. And only 300,000 tonnes of gold has been mined to date, in recorded history.
Supply will continue to decline as it gets harder and harder to find more gold. That will help keep gold prices high, along with the political instability that, in my opinion, will continue for the next decade. Hah, and gold will always be 'cool,' humanity has had a fascination with gold for at least the last 3000 years.
South African gold production is at all time low. But on the other hand, the production in Russia and Australia is increasing. And demand will grow, mostly due to economic growth in India and China. Who knows? Gold price can double within the next 5 years!
The wildcard are the entities that are holding onto large stockpiles of gold. I think they could turn the market again, and while I don't see any dramatic of a collapse as in the 80s, it could be enough to spook a lot of people into selling their small stockpiles and bring the precious metal prices back down to a lower level. Long term, I don't see as much of a risk though.
Same happened to Platinum during the 90s, when Gokhran (Soviet Precious Metals Agency) sold out a large part of their stockpile. I am not quite knowledgeable about the amount of gold held by various agencies and firms. It is rumored that China is having very large undisclosed amounts of gold. But these are only rumors and can't predict the future prices based on them.
