Gold price at $1355 an ounce within 12 months. That's what I read his morning in a MineWeb article by Lawrence Williams out of London. This gold price prediction is owned by Goldman Sachs, one that is $20 higher than their previous target price.Although higher, Goldman suggests this price may be the peak as they recommend gold sellers sell forward in order to lock in today's high prices and higher prices to come. But, if Goldman's message to sellers is, it will be smart to sell forward to lock in higher prices, isn't the message to buyers just the opposite? Don't buy forward, wait till the price comes down! According to reports, Goldman believes prices will temper as the economy starts to recover and the Fed begins to tighten monetary policy. Here's where you lost me.Today's consensus is that we are in a deflationary trend. The economy is not growing as consumers continue deleveraging. This morning, from Dave Rosenberg's Breakfast with Dave we get a quick update on GDP growth. The economy is clearly slowing — from 5.6% GDP growth in Q4, to 3.7% in Q1, to around 2% in Q2 and it seems like less than 2% this quarter (there is almost no growth at all being built into Q3).Even now the Fed is considering additional ways to bolster the economy. One method on the table, again from Breakfast with Dave, is to cut interest rates on bank reserves which is supposed to induce banks to extend more credit. There is debate on whether or not the consumer even wants to borrow more money. f they do not - plan does not work. Whether or not this particular stimulus will work or not is really beside the point. The greater point is that right now the Fed sees a need to stimulate, yet Goldman can somehow come to the conclusion the Fed will begin to tighten, apparently, as early as 12 months from now, after gold peaks. Typically, the Fed tightens to hold inflation in check. Historically, gold prices rise with inflation. Look at the period from 1973 to 1980 when inflation was running rampant and interest rates were rising toward a peak above 20%. Gold prices rose right along with it to a frenzy-induced peak, that if adjusted for today's inflation, would be near $2400 an ounce. So here we sit. The economy is contracting, the consumer is deleveraging and the gold trend is currently bullish - even according to Goldman. If it is true that the economy will start to recover in 12 months or so, as interest rates begin to rise in an effort to control the inflation rate, aren't those the conditions most favorable to gold?Historically, inflation and gold have walked hand in hand. There's a reason gold demand today, by central banks, institutions and individual investors alike, is skyrocketing. I submit it's the fear of inflation that drives demand for today. I also submit today's gold demand is relatively tempered as compared to the real demand ahead, as the Fed ultimately recognizes an inflation threat and begins to raise interest rates.Goldman's direct message to sellers is sell forward at today's high prices or tomorrow's higher prices. The implicit message to buyers may be left to interpretation. But one thing is for sure, the price prediction of $1355 an ounce within 12 months suggests gold prices are climbing 13.3% higher than today's levels within 12 months. I'm still hard-pressed to find another investment that is projected to do better. How about you?