Mostly: Classical

[amarksp]

FWIW, my fundamental opinion is POG will exceed $600 and can go much higher as you suggest on sentiment...

Two critical supply factors vs. demand:

1) Gold supply from producers will be stable at best for next several years until POG in SA Rand exceeds R110,000 per kg.
http://www.investorshub.com/boards/read_msg.asp?message_id=7073198
SA will have to reopen closed mines and new mines brought on stream before any meaningful impact on supply of gold from producers. It will take at least 2 years to reopen and develop these SA mines.

2) Supply via recycled gold will have to hit the market. You will know recycled gold is hitting the market when you see pages of newspaper ads offering to buy your gold jewelry for melt value... But most important will be how those Indians react to higher POG and if and when their recycled gold hits supply.

Demand will be driven by fear factor which you describe as sentiment. I do not believe we will see "non-sensical $3000" for POG, but $1,000 is feasible, given enough fear. Believe Turk's Fear Index is a viable means to measure this as well as the Dow:Gold ratio:
http://www.goldmoney.com/en/commentary/2004-12-04.html