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Gold price never 'really' hit all-time highs; Lobo Tiggre gives reality check

Kitco News

(Kitco News) - Adjusted for inflation, gold's price has not hit the all-time high yet, said Lobo Tiggre of The Independent Speculator.

"If we go by what the BLS [Bureau of Labor Statistics] publishes for its CPI data, we can see that gold has not hit a new all-time high. To match the 2011 peak,  gold would have to go over $2,150, which we haven't reached yet, and to match its 1980 peak, it would have to go over $2,700," Tiggre told Kitco News.

Furthermore, the metrics used to calculate the price of a basket of goods, as the BLS does with the consumer price index today, is not the perfect indicator of price inflation, Tiggre said.

"Many of us are skeptical of the way the BLS produces its CPI numbers, and a lot of us like to use John Williams' Shadowstats," he said. "John continues to produce CPI numbers the way the government used to do before they started making their hedonic adjustments and other silliness in the 1980s."

Tiggre said that more upside is expected for gold prices, but before gold hits $2,700 an in nominal terms, investors can expect more consolidation along the way.

"I do believe that the next leg is higher and so, inflation-adjusted or not, I think that this presents us with a buying opportunity right now, especially in the [gold] equities," he said.

Tiggre's bear case for gold is based on deflationary risks in the economy.

"If we see near-term deflation, then that whole inflation expectation, and you can look the price of gold as a measure of inflation…if suddenly you're not worried about inflation and you're seeing deflationary pressures out there, that could cause a knee-jerk reaction," he said.

On alternative investments besides gold and silver, Tiggre said he likes uranium.

"I can't promise that uranium's about to take off tomorrow, I can say that the fundamentals are very strong, it's already had a good year, and there are factors in play right now that could push uranium up in the near term, not just long term," he said.

In terms of how to invest in uranium, investors can trade uranium-backed exchange-traded funds as well as uranium companies, Tiggre noted.

"I'm looking for maximum alpha, so I'm looking at the stocks," he said.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.