There's a laundry list of fundamentals that support gold, namely a huge increase in the monetary base that will over time become an increase in the overall money supply, combined with policy makers having their eye on the wrong indicators (thinking unemployment is a good inflation predictor/gauge) and kidding themselves over the real impact of freezing just 1/10th the budget while the remaining 9/10ths is full steam ahead the USS Unsustainable.

The only real possible/maybe/but very unlikely to happen scenario that would fundamentally crush gold is a contraction of the overall money supply brought about through more loans going bad given the nature of fractional reserve banking. Basically a deflationary spiral. Problem for Soros' prognostication is the chances of our central planners allowing a deflationary spiral are less than the chances of a balanced budget in Obama's first term. Helicopter Ben who was just effectively greenlighted for another 4 years won't allow it.

AMEN to your comments on Soros and gold.
First of all, history has repeatedly confirmed that Soros and his Jimmy Rogers buddy are not to be trusted any further than you can throw them, because they have the habit of thinking and investing in the exact opposite manner than they speak publicly. They spend their lives attempting to talk down and manipulate markets, which tells me Soros is buying gold, and its time to short China, for SURE.
No way gold is in a bubble, its still more than 50% under its inflation adjusted real value, and if it werent for the GovernmentSachs/Morgan trading manipulation it would be WELL over $2000 an ounce. Dont let him hose you around, Soros is BUYING GOLD, - at least Jim Rogers admits it.
AMEN.

When Soros talks Asia listens they are so fear full at this Soros news they are throwing their Gold out their windows
giving the illusions that their streets are paved with it !

Of course this old windbag hates gold - had the world maintained the gold standard how could he have made his money? Honest investment in economic growth instead of curreny speculation?

I have watched a lot of rogers and soros and I agree with george that they seem to try to talk things up, etc. so be careful.

Also about the first posters comments, if we do fall into bad deflation I am not sure printing will have any effect against the massive wealth destruction. Right now housing is deflating, service costs are deflating, etc.

Great Soros, understand how emotional crowds operate.........thats why he is a Billionaire....and you and I are not.

What Soros really meant to say: "Okay, all you middle-class dupes. Sell your gold now, so larger institutions can absorb it prior to the revelation of it's drastically out-of-balance supply-demand ratio and the price sky-rockets."

I'm inclined to agree with Soros. I think he sees something that's very common at turning points: a crowded trade.

When traders begin to argue the case for a bullish trade by saying if central bankers print more money, gold will go up, but if they increase interest rates to stoke inflation, that means inflation is heating, so gold will go up.

No one ever argues the bearish trade. Everyone assumes currencies will depreciate, and never consider the case (coming soon to a municipality near you) in which currencies would appreciate, thereby reducing gold prices. We assume governments are all-powerful, all-knowing, just printing money with no consequence to drive down currencies. Well, no market participant, including government, is above the law of financial markets. Just ask Standard & Poor's what they think of European sovereign debt.

If the media (Bloomberg, CNBC, tv commercials to plain folk) has every trader/speculator committed to the same side looking for prices to go higher, pretty soon you have less buyers than sellers. When you have less buyers... then the price usually doesn't go up anymore... and buyers become sellers.

Let's not forget the record levels of commitment from traders we saw with oil. I don't know if peak oil exists. I don't think it matters. It only matters if everyone believes it... until they don't believe it anymore.

I don't know if unlimited money printing exists, although it only matter if everyone believes it...

Soros is OLD news ... listen to Peter Schiff !

Luke: read up on the Bernanke doctrine.

jfp: ever try taking physical delivery and long term storage on barrels of oil?

I think what Soros says makes alot of sense. We have seen gold futures contract volumes increase massively. Now with the volatility in the price the next thing we are going to see is the brokers changing the margin requirements. here is where the bubble is ,the futures market. current margin allow speculators to gear up 20X. Since 2009 gold price have surged 25% while jewellery demand, accounts for 70% of golds real demand, in Q3 2009 fell 30% YoY.

I'm really amazed at how dumb some folk are...

i have closely followed soros over the years, and consider him a savant of our times; I have never found him to be grossly wrong.

Time will prove who's right, so lets not argue.

Wow Franco, do you know my ex-wife? That's how she argued. "Your Dumb". "I'm right". "Now lets not argue any more".

def def definitely a savant definitely

Dan, that is how I got my user name.

"Well! If you're going to be all Mr Rational about it, then ...."

It never went well from that point. I'm just glad that she doesn't read the blogs and such where I use the nick.

He is going to find a way to devalue gold.

He intends to crash the dollar.

He is a financial terrorist.

Soros doubled his bet on gold about a month before this video was made but it was not disclosed until just now:

http://www.theaustralian.com.au/business/china-better-than-barack-obama-in-handling-the-global-financial-crisis-says-george-soros/story-e6frg8zx-1225835570857

You can interpret what Soros meant in a number of ways. Personally, I don't think Soros was saying that we are now in a gold bubble, and it can pop any second now; what he meant to say is that from all asset bubbles, gold is the ultimate bubble, the mother-of-all bubbles. Throughout history, in financial crises - 1929, 1970s - the purchasing power of gold went up 15 - 17 times as people were rushing into it as fast as they could. Gold is "only" up 4 times since its historical low in 2000, so even if we are in a bubble, it might get much, much larger ultimately!