glorieux:

You assume in your original post that gold will continue around $1100.

That's okay, but wouldn't a conservative estimate be something like $800? After all, it's better to hang your hat on a certainty, like nothing in the world could push gold below $800 this year.

But since gold's value is fear-based, there are a lot of things that could reasonably happen this year that could bring gold down below $1000. Obama pulls a Clinton and balances the US budget, China Korea & Japan continue lapping up US T-bills the way they always have, a devalued US currency gives the US an export advantage creating tons of American jobs, 1.2 billion Indians decide they won't buy gold jewelry at high prices, and Jews & Muslims the world over suddenly become best friends.

If the most optimistic possible scenario for the coming year actually happened, what would that do to gold's price?

I'm just trying to test your theoretical model, is all.