{"id":36812,"date":"2013-03-12T23:52:22","date_gmt":"2013-03-13T03:52:22","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=36812"},"modified":"2013-03-12T23:52:22","modified_gmt":"2013-03-13T03:52:22","slug":"the-best-gold-stock-advice-to-ignore","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/03\/12\/the-best-gold-stock-advice-to-ignore\/","title":{"rendered":"The Best Gold Stock Advice to Ignore"},"content":{"rendered":"

By MoneyMorning.com.au<\/u><\/a> <\/p>\n

Every year since 2007, bank and brokerage analysts have as a group predicted that the gold price<\/strong> would fall, sometimes dramatically, over the next four-year period. That’s not merely bad advice; that’s flawlessly bad advice.<\/p>\n

Bank and brokerage analysts certainly know their sectors. But when it comes to helping you make an informed decision about where the gold market<\/a> is headed, they have ‘a record unblemished by success,’<\/em> as resource stock expert, Rick Rule, is fond of saying.<\/p>\n

Every year, major banks and brokerage houses provide their four-year forecasts for the gold price<\/a>. The following chart documents the average price projection of 25 top analysts over the past seven years, many of whom specialize in the resource industry. I might suggest pushing away from your desk so that when your jaw drops it doesn’t hit the keyboard.<\/p>\n

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In 2007 the consensus of all estimates was that gold would decline from US$656 to US$523 by 2011. Instead, the gold price rose 140% to an average of US$1,572 that year. The consensus has issued similarly errant forecasts every year since then. So far, they’ve been wrong every time.<\/p>\n

Some Big Implications on Gold<\/h2>\n<\/p>\n

For the most part, these are analysts who do nothing but study the resource markets all day long. It’s their job. No one gets it right all the time, but this kind of track record is embarrassing.<\/p>\n

The obvious lesson for investors is to ignore price predictions from the major banks and brokerage houses – they just don’t get it. I’m sure most readers of this publication already know that.<\/p>\n

However, there’s a much bigger implication of this data that may not immediately come to mind…<\/p>\n