Eric Sprott is a hedge fund manager who’s long precious metals and mining stocks – and he has no intention of changing that strategy anytime soon.
Despite the sharp decline in gold, he tells us by year’s end his price target for gold is $2000.
“We’re seeing statistics on physical gold purchases that argue very strongly for the price of gold to go up,” he says on CNBC's Halftime Report.
In other words, Sprott believes there are plenty of buyers in the market.
For example, “Exports of gold from Hong Kong into mainland China went up 600% year over year in the month of March.
And that’s not just a one month phenomenon. ”In the last 9 months China has been buying massive amounts of gold,” Sportt says.
Also, he says, non-G6 central banks around the world are buying gold. “As a non-G6 central bank do you really want to buy a US Treasury that’s yielding less than 2%. Do you want to own a European bond when their banking system is falling apart? No. They want to buy gold.”
Also, Sprott points to gold’s historical performance.
“Gold was the investment of the last decade,” he says. “It blew away almost any other investment you could have made.”
Although he concedes gold is currently 'in a funk' he expects sooner rather than later, gold to resume its march higher.
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Trader disclosure: On May 9, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Anthony Scaramucci is long AAPL; Anthony Scaramucci is long BAC; Anthony Scaramucci is long GS; Anthony Scaramucci is long IBM; Anthony Scaramucci is long PEP; Pete Najarian is long AAPL; Pete Najarian is long C; Pete Najarian is long MS CALLS; Pete Najarian is long INTC; Pete Najarian is long INTC CALLS; Pete Najarian is long YHOO; Pete Najarian is long SBUX; Pete Najarian is long SBUX CALLS; Pete Najarian is long PEP
CNBC.com with wires.