Today the man who has become legendary for his predictions on QE, historic moves in currencies, and major global events spoke with King World News about why the risk of a total meltdown is increasing exponentially. He also addressed the all-important question: How much gold do China and the West really possess?
Egon von Greyerz: “Eric, investors worldwide are sitting with assets inside of giant financial bubbles. We are talking about a $250 trillion bubble in stocks, bonds and property. The size of the bubble has increased from $150 trillion to $250 trillion in the last 15 years. That’s a staggering 66 percent increase….
Continue reading the Egon von Greyerz interview below…
“We talked last week about how the $100 trillion bond bubble will soon start to implode. We’ve seen bond yields start to surge in the last few weeks, led by the German 10-year bund. But, Eric, this is just the beginning. No government can or will repay this debt with real money.
Bond yields will go from less than 1 percent today, to 2 percent and then 5 percent and later to 15 – 20 percent, just like they did in the 1970s and early 1980s. Eventually bond yields will skyrocket as the underlying debt becomes worthless.
Most people believe this can never happen but this has happened before in many countries. The problem this time is that every major economy in the world has issued debt that they can never repay. Of course they will initially issue more debt but this will not solve the problem. The bubble will simply get bigger until it implodes into a black hole.
One Quadrillion Dollars Worth Of Derivatives Will Collapse To Virtually Zero
With the debt implosion will, of course, go the one quadrillion dollars of derivatives. So as the value of the debt falls, so will the value of the assets that the debt supports. Before this is over, debt and derivatives will collapse to virtually zero. Most assets will fall in real value by at least 95 percent.
The Great Reset Is Coming
This sounds incredible, Eric, but it really isn’t. What will happen is we will have a dramatic reset that puts the clock back 100 years. This will be a small thing in terms of the history of the universe but it will be a very dramatic thing for people living through it when it begins to unfold because the explosion of the bubble will happen a lot faster than the 100 year expansion we have seen.
This collapse will lead to social unrest, famine, wars, etc. But sadly this is the only way to give the world a fresh start, unburdened by debt and financial and political repression. I don’t believe that the East or the West has a chance to come up with a scheme to solve this problem but I’m sure that they will try.
The question is: When will this happen? The simple answer is that I don’t know. What I have learned is that things take longer than you expect, especially when the vested interests of the powers that be are so great.
Countries In The East Know What Is Coming
The countries in the East see that this worldwide implosion and reset is coming. This is why so many countries in the East continue to accumulate gold. China and India by themselves are basically buying the entire annual production of gold. Then we have Russia and all of the other countries in Asia and the Middle East who are also big buyers of gold. This is why the flow of gold from West to East continues unabated.
The reality is that the countries in the East are preparing for the coming disaster by holding to the old truth that ‘He who owns the gold makes the rules.' Most of the physical gold has already been emptied out of the Western central bank vaults and the bullion bank vaults. So what we are witnessing right now is the beginning of the decline of the West and the rise of the East.
How Much Gold Do China And The West Really Possess?
Eric, there has been a lot of talk about how much gold China possesses. The estimates range from 4,000 tonnes to 10,000 tonnes. But what is even more important is what Western central banks don’t hold. The West central banks are supposed to have around 23,000 tonnes of gold in total. But there are so many signs that they only have a fraction of that.
First, the Fed has not had an audit of its supposed 8,100 tonnes of gold since the 1950s. Not a single Western central bank issues a proper audited report of its physical gold holdings, including any leasing and lending activity, or derivative positions. We also know what happened when Germany and other countries tried to repatriate their gold from the U.S., the UK or France. These countries are only getting a fraction of the gold back because the gold isn’t there.
Risk Of A Total Meltdown Is Increasing Exponentially
Eric, coming back to when all of this will implode, we don’t know. But what we do know is that the risk is increasing exponentially and is much higher today than it was in 2008. I say time and time again that you can only buy fire insurance before the fire starts. So investors must hold physical gold now and store it outside of the banking system.” ***ALSO JUST RELEASED: China's Upgraded Military, The IMF And The Move That Will Send Gold Skyrocketing CLICK HERE.
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The audio interviews with Robert Arnott, David Stockman, Chris Powell, Andrew Maguire, Rick Rule, Bill Fleckenstein, John Mauldin, Michael Pento, Gerald Celente, Egon von Greyerz, Dr. Paul Craig Roberts, James Turk, Dr. Philippa Malmgren, Eric Sprott, Marc Faber, Felix Zulauf, John Embry and Rick Santelli are available now and you can listen to them by CLICKING HERE.