In a Global Equity Research note JP Morgan has predicted the price of gold to hit $1300 soon.

They expect significant inflation to develop over the next two years. Gold is a portfolio protector in times of inflation, gaining or maintaining value as the dollar lapses into impotence. JP Morgan cites the difficulty the Fed will face to reduce all the liquidity that has been injected into the money supply.

The high cost of mining is another reason for gold’s price support, according to the report. Mining companies have had to dig deeper to extract exceedingly poorer qualities of ore. Their costs have also soared higher due to the need to employ skilled labor. As mining has become more difficult, their workers require higher levels of training and precision, which has also increased costs.
However gold’s biggest price support comes from the actions of Central Banks. The firm commented,

In the 1990’s central bankers were acting as a group to reduce their gold holdings, confident that the fiat currencies were a better store of value. Now gold’s attractions are re-emerging and bankers look set to be net buyers which should help tighten the market.

Already this year, the Central Banks of India, China, Sri Lanka, Mauritas, and Russia have made public large purchases of gold bullion.

Here is a great compilation video of more mainstream news commentators discussing how far gold’s bull run will go. Peter Schiff says it could go higher than $5000/oz. It’s impossible to tell the ceiling on gold, he says, because the floor on the dollar is zero. Jim Rogers predicts at least $2000/oz, and Max Keiser discusses the enormous bullion purchases China has made this year.  Looks like its still a great time to buy gold!

RTT News reports that gold jumped up to a new record high. By 2 pm,  the price hit $1,143.25 an ounce, and closed a few dollars under that at $1,139.20 an ounce. The record high came after Federal Reserve Chairman Ben Bernanke said the central bank was monitoring the slumping US dollar; gold generally moves opposite of the dollar.

Some assume that the recent spike is due to the holiday season rapidly approaching, and consumers emerging to buy gold as gifts.

The next benchmark level for gold is now seen at $1150 an ounce, but some analyists believe that we could see a significant jump by the end of the end, upwards of $1200-$1250.

Silver hit it’s highest since July, at $18.43 an ounce, and platinum hit $1,451.50 an ounce, it’s highest since September 2008.

The Financial Times reports that gold dropped slightly on Friday after reaching past the $1,1oo mark. Weakness in the U.S. dollar has provided extraordinary support for gold, however, even with a price decline some analyists still believe that gold will sustain it’s power.

Precious metal analyst at HSBC, James Steel, informs us that, “Given gold’s recent near-meteoric rally, even a sharp price decline would not necessarily call the longer-term rally for bullion into question”.

Bullion has hit record highs for six out of the past eight sessions.

Yes, at record highs, gold is still a bargain. But don’t take our word for it, listen to what these guys are saying:

-Paul Tudor Jones, hedge fund manager and one of Forbes’ wealthiest, famous for predicting Black Monday in 1987, as well as the Nikkei crash, stated that now is the moment to buy gold, as its price is still “cheap.” Tudor told his investors yesterday, I have never been a gold bug. It is just an asset that, like everything else in life, has its time and place. And now is that time… gold’s value should increase as its scarcity relative to printed currencies increases.”

-Peter Schiff, live from the floor of the New York Stock Exchange, reiterated that gold will go higher. “If you don`t own gold you should buy it, don`t think its expensive. Don`t wait till its selling for 2,000 dollars an ounce to buy it.” Check out the video below.

You are being told a million different things about what do with your money by the media. You don’t want to miss out on a great opportunity, but you don’t want to get in too late and look like sucker. You especially don’t want to lose your shirt (or your pants!) when the guys on Wall Street are making six figure bonuses.

Yet every single day, dozens of screeching talking heads are either yammering back and forth about opportunities you shouldn’t miss or spewing forth theories apocalyptic doom and gloom that would make anyone reach for the prozac. And then the paralysis slowly creeps in until you are completely overwhelmed and just sit there and do nothing, possibly missing the greatest investment opportunities of your lifetime.

Right now, the experts are arguing. And it might be confusing for you to figure out whose opinion you can trust. Jim Rogers, known for his legendary portfolio management skills, and Nouriel Roubini, NYU professor and Dr. Doom economist, have been sparring on your cable news shows about whether gold’s current bull run will continue to astronomical profits, or whether gold will just keep its value as we whether out the crisis. Either way, the outlook for gold is good. But the two are pretty riled up and hopefully it doesn’t resort to name-calling.

Rogers is predicting gold with rise to $2000/oz or “much, much higher.” As of the writing of this blog post, gold is less than ten dollars away from $1100/oz. Roubini is saying that Rogers is wrong and that there is the threat of a bubble in the gold market. To which, Rogers responds with a smile, “It’s clear Mr. Roubini hasn’t done his homework, yet again.”

Now, while I don’t doubt Mr. Roubini’s credentials, Jim Rogers is a very skilled investor. Rogers predicted this precious metals bull run. The way that Jim Rogers made his name though is more involved than making broad predictions. At the age of 28, Rogers started the Quantum Fund in 1970. Over the next ten years, the portfolio gained 4200%, while the S&P only gained 47%. For a portfolio to outperform the market by such astronomical levels, well all I can say is that is very, very rare. It takes a devoted manager to know the markets cold, to have a dramatic understanding of cause and effect, and maybe even a gut he can trust.

Both men have respectable opinions, and neither has a crystal ball feeding them the magic number in which gold will hit its price ceiling. And when you feel exposed, part of that is because you don’t know who to trust and you don’t want to make the wrong decision when a lot is at stake. One trick to handle this is modeling. What asset is Jim Rogers, an astronomically profitable investor, predicting to double in value? The answer is gold. What it is his main reason for this belief? He is looking back to history, “The old high, back in 1980 adjusted for inflation, would be over $2000 now, just to get back to the old high. So we’ll certainly get there some time in the next decade.”

“Gold may rise to a record $2,000/oz in the next three years as investors hedge against massive inflation sparked by governments printing money,” a Superfund Financial analyst told Bloomberg. Gold gained 2 percent today as the dollar’s value continues to jump around like a heart rate monitor. The other precious metals also did well today with silver and palladium moving up 3 percent and platinum nearly 2 percent.

Precious metals have historically been viewed optimistically when stocks perform poorly. Those looking to buy gold right now cite their fears of inflation and the weakness of the dollar as the major reasons for their investment choice.

Superfund’s Managing Director Aaron Smith said, “Soon, when you go to buy a cup of coffee, you’ll pay $20 or $30 because the dollar won’t be worth anything.” But the dollar won’t be the only problem. Due to globalization and the interconnectivity of trade and investment, Smith continues, “When the U.S. dollar crashes, all the paper currencies have to crash, otherwise if their currencies are too strong, their economies will be weak.”