My Blog
Michael Pento - Here is Why Gold is Soaring After Hours
With gold soaring, up $50 in access market trading to over $1,820, today King World News asked Michael Pento the reasons for the big move in gold as well as his thoughts on Bernanke’s speech. Pento had this to say when asked about the explosive situation in gold, “Chairman Bernanke reiterated yet again that the Fed would do whatever it takes to restore prosperity to the US economy. The academic still doesn't understand that this is a balance sheet recession and all he has accomplished is to offer inflation along with zero growth.”
© 2011 by King World News®. All Rights Reserved. This material may not be published, broadcast,
rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
August 26, 2011
Michael Pento continues:
“It is a pity he is also so unaware that his zero interest rate policy has both prolonged and exacerbated this recession. Therefore, after an immediate selloff, the major averages recovered on Bernanke's promise to extend the September FOMC meeting an additional day.
Gold also soared with equities on the belief that the now two-day September meeting would offer even more monetary stimulus. The Chairman's "tools" all offer different variations of the same idea. That is, what is the best way to destroy our dollar. This next meeting will most likely produce a reduction in interest paid on excess reserves, in an effort to force banks into expanding the money multiplier.
M2 money supply is already growing at a 20% annualized rate in the last quarter. Just imagine the amount of inflation you’ll get when banks are compelled to start loaning money through the drive-thru window. Bernanke's answer to everything is to spend and print more money. That's bad for the economy but great for things priced in dollars. Especially that which supply can't be increased by decree.”
© 2011 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. However, linking directly to the blog page is permitted and encouraged.
Eric King
