Strong year 2024 – Gold price: Expert expects further highs

At about $2,620 per troy ounce (about 31.1 grams), the precious metal is worth almost 27 percent more than at the beginning of the year. “Last year we predicted $2,660 with our gold price model,” says gold expert Ronald Stöferle, pleased with his almost accurate landing. “I would imagine we’ll see $3,000 next year,” Stöferle said.

The gold price reached its previous high of about $2,790 per troy ounce (about 31.1 grams) in late October, shortly before the US presidential election. “Our long-term price target, and we announced this in 2020 and received a lot of criticism for it, is $4,800 – and we clearly remain there,” said Stöferle, whose investment and asset management company Incrementum, based in Liechtenstein, sets the price target . his cause published an annual “In Gold We Trust” report, which was highly regarded in the industry.

Maintaining long-term purchasing power is the central role of gold
Despite the current rise in gold, the following applies: “Gold doesn’t make you rich overnight, but it doesn’t make you poor either,” says Stöferle. “The central role of gold is to maintain purchasing power in the long term and to increase purchasing power over longer periods of time. How come? Because gold reserves are only growing by 1.5 percent every year.”

Unlike traditional commodities that are consumed, gold is a stock item, Stöferle explains. The current stock is approximately 215,000 tons and approximately 3,600 tons are added annually. “In relation to the entire supply extracted from the ground over the centuries, the annual production is very low.”

The value of Bitcoin has more than doubled in one year
The situation is similar to the cryptocurrency Bitcoin, which is modeled after gold and cannot be inflated at will. This is also the case, for example, with vintage cars, Rolex watches, old wines and paintings – “but they are not liquid, they are not replaceable, they are not divisible, and there is no real global market for them.” that is why it is chosen In addition to gold, investors are increasingly also choosing Bitcoin. The value of a Bitcoin has more than doubled since January 1 of this year from more than 44,000 dollars (42,166 euros) to just under 94,000 dollars. In mid-December, more than $106,000 was paid per Bitcoin.

“Gold and Bitcoin have very similar properties and we see them as related rather than as adversaries,” Stöferle said. “Satoshi Nakamoto, whoever he was, understood gold and our monetary system very, very well.”

“Value is always subjective”
Stöferle does not accept the objection that Bitcoin is “nothing real” and therefore could become worthless overnight. “As an old Austrian I have to say: value is always subjective.” Stöferle is referring to the Austrian School of Economics, whose central features include the subjective theory of value. Accordingly, the value of goods cannot be determined objectively, but rather results from the individual preferences and decisions of consumers. “What is the value of a painting by Van Gogh or Rembrandt, an Nvidia share or a building in the 1st arrondissement? As much as people are willing to pay.” The world is becoming less and less physical. “More and more value is happening in the digital world, why wouldn’t it be the same with currencies?”

Stöferle does not believe that Bitcoin can be banned. “That’s all out of the way now.” With the approval of Bitcoin ETFs by the US Securities and Exchange Commission (SEC), Bitcoin has risen to the rankings of classic financial assets. “As a portfolio manager, you no longer run any risk in putting Bitcoin in the portfolio for your clients.” The fact that future American president Donald Trump also talks about a strategic Bitcoin reserve is “an absolute milestone”. Stöferle’s colleague Mark Valek, who specializes in Bitcoin at Incrementum, believes the price of Bitcoin could rise to $180,000 in the next two years.

No cannibalization
Stöferle does not see that gold and Bitcoin can compete with each other because the groups of buyers are very different. Equities are not a competitor of gold, but of the bond market. Demand for gold is currently strongly driven by central banks, which absorb almost 30 percent of annual financing. The global asset management industry currently has a volume of approximately $128 trillion. “The gold allocation is somewhere between one and two percent and Bitcoin is probably a tenth of that.” Rebalancing is therefore more likely to occur on the bond side.