Gold Bulls Eye $1,000 Bullion

Turk says the mortgage crisis will spread much further than previously expected, and that a new factor in global financial markets should propel gold prices to record levels: counterparty risk.

"That's where people start to question the promises made by financial institutions and wonder whether they are creditworthy," says Turk. As a result, investors will want gold, he says.

Turk recommends purchasing coins or bars rather than ETFs.

Portfolio manager Jean-Marie Eveillard, who runs the $1.2 billion (SGGDX Quote)First Eagle Gold Fund, agrees with the bullion-over-miners call, saying it means not having to worry about the management.

"Gold-mining companies have been in the terrible habit of issuing equity, diluting the value of the stock to current shareholders," says Eveillard.

For that reason, he says the ETFs are less of a hassle than owning physical gold. He's bullish, but he wouldn't venture a gold price target.

Frank Holmes, who runs the $192 million (USERX Quote)U.S. Global Investors Gold, sees a 60% chance of the price exceeding $1,000 next year, with inflation worries driving the market.

Unlike last year, when Holmes focused on recommending mining stocks, this year he says more than half of any gold allocation should be in bullion, either coins such as the U.S. Mint's gold eagle coins or one of the ETFs.

David Beahm, vice president of economic research at New Orleans coin-dealer Blanchard, sees a price of up to $1,150 by the end of next December.