The rally in gold prices has driven several bullion analysts to
frenzied forecasts. Some say gold prices will reach $2,000 per ounce
soon. Others are predicting big boom for the yellow metal, saying gold
prices will zoom to $5,000 and eventually to even $15,000 per ounce in
the years to come.

What is happening in bullion market these
days? Yes, agreed that weakening dollar, global economic meltdown,
shrinking gold supply and increasing cost of mining gold from the earth
are all making gold the most-sought after investment these days. That
is also driving the yellow metal prices to record highs.

These
days, the biggest gold buyers are not individual customers or families,
but global central bankers that are vying with each other to accumulate
gold reserves in an attempt to get out of their decades-old dependence
on the US dollar as the best asset class. India jumped into the bullion
fray to buy 200 tonnes of gold from the International Monetary Fund
(IMF) early this month. Other countries like China, Russia, Brazil and
Sri Lanka are frantically trying to accumulate gold reserves.

Agreed
that gold has emerged as the best asset class among bullion traders,
central bankers and families across the world, how far can the yellow
metal price surge?

One of the avid proponents who is arguing
that gold price will surge past $2,000 soon is the legendary
commodities investor Jim Rogers. Rogers, chairman of Singapore-based
firm Rogers Holdings, says gold prices are booming because currencies
across the world are dropping and the US dollar is collapsing. His
latest forecast: gold will touch double the current price—around
$1,150. Meaning, Rogers says gold will surge to $2,300 per ounce in the
coming months.

But it is easy for renowned investors like
Rogers to make forecasts like this. Rogers is a big commodities
investor. He invests basically in agricultural commodities. He is going
gaga over his commodities investments in the hot destination he loves,
China. But is Rogers investing in gold these days? No, not to my
knowledge. Investors like Jim Rogers love gold, but they hate to invest
in gold at this high price.

Investors like Rogers are not
putting in money into gold these days because they know sensibly well
that investing in yellow metal is “nonsense.” Because, gold price is at
its peak these days, and anyone putting in money in gold at this high
rate will be taking a huge risk.

In fact, all big investors
are these days selling gold. Imagine the money bullion traders and
speculators have made out of the global bullion market in November, as
gold price surged to nearly $1,150 last week! So if you buy gold at
this rate, those had bought gold at $700 per ounce one and half years
ago would be laughing their ways to the banks.

So, what is the
advise to bullion investors? I would say the current bullion market is
the one for selling, not for buying. Sell your gold now, if you are
getting any price above $1,000 per ounce. Gold price is sitting on a
bubble. The bubble can burst any time like the stock market crashes.
When the bubble bursts, gold price will come down below $1000 and you
can buy then your precious metal.