NEW YORK ( TheStreet) -- TheStreet's Jill Malandrino and Oliver Garret of Hard Assets Alliance and Casey Research discuss where gold is headed after Wednesday's FOMC meeting.
With gold dropping to less $1,300 per ounce and reaching its lowest levels in more than two years, Malandrino asked whether the move could also be chart-related. Garret said it is. He also said that gold prices may continue to sink and could possibly fall to $1,200.
But Garret argued that although the paper markets have been getting crushed, the demand for physical gold actually remains quite strong.
Rather than being scared of the selloff, he said the drop is a window for investors to step into an asset that is deeply undervalued and that may remain so for several months.
He cited the continued quantitative easing from both the
and central banks from around the world as reasons to continue owning the metal.
Although he said gold is still on its path to reach $2,000 an ounce, Garret would much rather own stocks of miners than the
SPDR Gold Shares
He said that GLD is a paper asset with no leverage, whereas the miners provide exposure to gold at deeply discounted levels, possibly as low as 10 cents on the dollar.
Garret concluded that a lot of the miners have tremendous upside "beyond the price of gold," and pay out dividends.
-- Written by Bret Kenwell in Petoskey, Mich.