I don’t know if you saw this today, but several of my friends have traded emails on this. Personally I think any suggestion that gold is going anywhere near $9000 is outrageous. However, I do think it could potentially break $2000 if some of what this analysts suggests actually happens. Rather than quote his rationale (because you can just go read his story at the link at the end of this article) I am going to give you what I think is the logic behind a move in gold of no less than a 50% gain at times this years – and possibly as high as 100%.

The number one thing I see is that our monetary policy is as much a bubble as any bubble we have had before. There will come a time when the Fed just stops pumping out of necessity. Or – worse than that – expands the currency to such a degree that the dollar becomes worth a whole lot less than it is today. The Obama Administration is clueless on a sound monetary policy. What they replace such a policy with is essentially a quasi-socialist policy. There  is not doubt the administration wants to level out big earners and simply force their version of economic justice. What that means is they have no real interest in protecting the value of the dollar.

The number two issue that will crop up is that as we continue along this road those that buy our treasury bonds at current levels will begin to say, “Hey, if you want me to buy these bonds you are going to have to pay me a whole lot more interest.”  They will likely say that in Chinese as our Treasury Secretary bows and says “yes, sir.” It is clear that once that process starts, if it does, inflation will come back in a massive way. Then we will see the dollar slide.

Other reasons the price of gold could increase include those that will buy when any type of sell-off happens in stocks.

Remember, the markets in United States benefitted from the world economy in 2013 with our companies that serve different markets world-wide. Without those positives we would likely have not seen the markets doing nearly as well as they did last year.

I am not predicting depression. I am not suggesting we will get a 2008 or 1987 stock crash. I am suggesting that the moment inflation takes hold, gold is going to rally in a big way. More than likely it will rally several times more than one would expect from the inflation.

UP NEXT: THE STORY ABOUT THE ANALYST SUGGESTING GOLD IS GOING TO CROSS $9000: