Gold for June delivery added $3.80 to settle at $1,498.90 an ounce at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,506.50 and as low as $1,493.80 during Wednesday's session, while the spot gold price was adding $3.40, according to Kitco's gold index.
Silver prices jumped 54 cents to close at $44.46 an ounce after breaking the $45 level.
Gold has surpassed many analyst expectations for 2011, with Brian Hicks, co-manager of the U.S. Global Investors Global Resources Fund, increasing his price target to $2,000 in 18 months and silver to $100.
In 2009, "we had central banks starting to buy," says Barisheff, "and once you [have] institutions ... coming around to the conclusion that they need to add a meaningful percentage" prices will go higher. Barisheff says there is only $6 trillion in above-ground supply of gold, with $3 trillion of it being bullion. Out of the $3 trillion, half is in central bank vaults and the other half is in private hands. Financial assets are worth $200 trillion, not counting derivatives and real estate, so any movement out of the $200 trillion and into the $1.5 trillion would be huge. "The only thing that can adjust is the price."
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