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Gold approaching $3,000 an ounce is priced so far ahead of inflation that the yellow metal
GC00 is unlikely to produce a positive real (inflation-adjusted) return in coming years.
That’s the implication of research from Campbell Harvey, a Duke University finance professor, and Claude Erb, a former commodity-fund manager at TCW. When they completed this research in 2012, the ratio of gold’s price to the U.S. consumer-price index stood at around 7-to-1. Because that ratio was about twice its historical average, they predicted that gold’s subsequent return would be below average.
