Is golds long-term average of $700-800/oz a fair value for the metal?
Nick: Yes. In fact, if the Fed is a little more restrictive than normal – which we think it is – it should actually be a little below that number. But as we see interest rates start to normalize, and the economy start to improve, I think that’s going to work itself out. So a return to an equilibrium price somewhere in that range is what we expect. We don’t necessarily have a target date or time horizon, but we think gold will trend lower overall. Crigger: How does investment demand from ETFs make a difference in gold’s demand picture? Nick: The gold market has really changed, as far as the makeup in where demand is coming from. One of the reasons why I think you’ve seen such a sharp, dramatic run-up is that it’s become a lot easier for the mom-and-pop investors to invest in gold. There are ETFs now, like GLD (GLD), that you can buy through your online trading account that hold gold directly in the fund, and you don’t have to find a way to store the physical. So it’s a lot easier to buy
