With the price of gold and silver soaring, today John Embry told King World News there is going to be a continued massive surge in the gold price, but the gains in silver will be “historic.” Embry spoke at length about the gold and silvermarkets, the Fed and the mining shares. Below is what Embry had to say in this powerful interview.
Embry: “I’m focused on the better tone in the gold and silvermarkets. It’s been a long struggle, but with all of the information that’s come out recently regarding how tight the physical market is and the fact that the paper gold market really is one of the greatest Ponzi schemes of all-time, I think we could finally be on the cusp of a huge move in gold….
“I’m not talking $100 to $200 move for gold. I mean gold going back to the old high of $1,920 in a fairly short period of time.
One thing that drove me crazy last week was Bernanke’s testimony and some of his statements after the fact. Gerald Celente noted that Bernanke said if the Fed wasn’t continuing to print money, that the economy would ‘tank.’ That’s exactly what all of us have been saying on KWN for months, if not years.
But it’s interesting that Bernanke basically said as much himself, and nobody picked up on it. Bernanke was asked by one of the Congressmen if he was printing money, and he answered, ‘not literally.’ Now what does that mean? If you are creating $85 billion a month to buy Treasuries and bad bank mortgage debt, if that’s not printing money then nothing is.
On the heels of Ben Bernanke signaling that the U.S. economy is weak and needs a highly accommodative Fed policy, today one of the top economists in the world said that despite the recent capping of gold at $1,300, gold is heading to new all-time highs. Michael Pento, founder of Pento Portfolio Strategies, wrote this piece for KWN.
Pento: “The prevailing mantra on Wall Street is that gold’s bull market is now over and it’s time to bury precious metals as an investment theme for the indefinite future. The rational for this is based on the belief that many investors held misguided fears during the credit crisis about a breakout of massive inflation and economic chaos, which drove gold to nearly $2,000 per ounce….
“Of course, (the perma-bulls on stocks claim) those worries have now completely failed to materialize and will never be a genuine risk in the future. This argument is patently false because it assumes that the final chapter has been written on the Great Recession and debt crisis that paralyzed the entire globe back in 2008.
The truth is the most pernicious effects of the devastating economic collapse that began five years ago have been merely held in abeyance due to record low interest rates and an aggressive expansion of central bank assets; which is being used to boost real estate values, equity prices and the economy.
On the heels of continued volatility in key global markets, the Godfather of newsletter writers, Richard Russell, discussed gold at length and also warned that the Federal Reserve has set America up for “disaster.” This is a fantastic piece where Russell notes the gold market may be ready to roar as physical gold is continuing to be drained from the COMEX.
Richard Russell: “Everybody knows that the US has an almost unsolvable problem with debt. Let’s call it a predicament, since there is no way of solving the debtproblem in an acceptable way (I mean in a politically acceptable way). Of course we could declare sovereign bankruptcy — or we could turn to hyperinflation and literally inflate our way out of the debt-trap. But neither would be acceptable or politically possible.
But before the predicted disaster, you can be certain that the coming trouble will be sensed and registered in the price of something. It will show in the price of stocks or gold or bonds or the dollar. In other words, it will show somewhere in price.
What about the bond market — isn’t the bond market now saying, “trouble ahead?” In my opinion, not yet. True, bonds have taken a beating in recent months, but I don’t call the decline in bonds, so far, a red-flag prediction of disaster … And the stock market continues to rise, probably based on the current ocean of liquidity.
How about gold? Ah, gold may be about to raise the red alarm-flag. But not quite yet. As a personal opinion, I believe gold has now put in a major bottom. Wait — what about price? Ah, there you’ve got me. Even if a bottom has been put in, we have not yet seen the “meat.” The price of gold has not yet started to boom. It’s one thing to say that you believe “the bottom is in,” but it’s another thing to see the item surge off its low.