On the heels of the surge in gold and silver, today acclaimed money manager Stephen Leeb told King World News the price destruction we have seen in gold and silver will soon be a distant memory. Leeb also spoke with KWN about the desperation by the West to suppress the price of gold and how it is about to fail.
Leeb: “My thoughts are that Bernanke surprised me last night. He came across as very dovish, and this is a man that knows exactly what he is doing. He doesn’t speak without thinking about what he is saying and what effect it will have. So you have to ask yourself, why was he so concerned about getting across a message that the Fed is still quite dovish, and highly likely to continue for quite some time with QE?….
“There are a couple of reasons: One is the economy is not nearly as strong as what has been painted in the press. So the economy is still in recession. The other concern Bernanke has is that the U.S. dollar has been very strong. Any suggestion of cutting back has seen the dollar surge and that is not what the Fed wants. So the Fed is trying to talk the dollar down.
In that environment, how can investors not be bullish on real stores of value? Whenever a country’s currency strengthens, they immediately do whatever they can to bring the value of their currency down. So gold and silver are starting to surge once again.
I have to tell you that I don’t think the West has given up yet on trying to hold gold down. But right now you have backwardation in gold and that’s rarely ever seen. This is only seen when there is a shortage of gold. Where is that shortage of gold? In the West.