My Blog

Eveillard - We are Headed for Enormous Inflation & Higher Gold

With advancing to the $1,680 level and silver firmly above $32, today King World News interviewed legendary value investor Jean Marie Eveillard, who oversees $50 billion at First Eagle Funds. KWN wanted to get Eveillard’s thoughts on gold and global money printing. When asked about the continued money printing, Eveillard stated, “What we already had was the fact the Federal Reserve was printing money and the Bank of England was printing money. Now you have the European Central Bank, in an indirect manner, is also printing money. They have made enormous amounts of money available to commercial banks, from the European Central Bank, for the next 3 years on very cheap terms.”

Jean Marie Eveillard continues:

“The central banks have availed themselves of several hundred billion dollars, and apparently there will be another run in a week or two. There is a suspicion that some of that money, once in the hands of the commercial banks, goes into buying some Italian government bonds or Spanish government bonds.

It’s all newly printed money by the European Central Bank and that’s why, in an indirect manner, the ECB is doing exactly what the Federal Reserve and the Bank of England have been doing for quite a while. I don’t think it will be too long before the Japanese, which are suffering because the yen is too strong, do a little money printing themselves. All of this is very good for gold.

Incidentally, I noticed there are a few articles beginning to appear talking about the Austrian School of economics. There was a column in the Financial Times by Gideon Rachman where he says, in essence, ‘Well, I’m feeling a little bit Austrian today.’ Rachman’s article has a lot to do with the idea that when he looks at the gigantic amounts of money the ECB is being forced into printing, in order to help the European situation, he says, ‘Hey, you know that’s potentially enormously inflationary.’

Continue reading the Jean Marie Eveillard interview below...

To hear legendary Jim Sinclair discuss which company he believes

is the best investment and why click on the logo:

“What happens is you are buying time, but what happens is in order to stabilize matters in the short-term, you are comprising the medium and the long-term. I think, eventually, this is going to be highly inflationary.

Now, number one there is a problem of semantics there. The Austrians always said, ‘Inflation is not the increase in the consumer price index or the increase in the prices of various assets. Those are only symptoms of inflation. Inflation is the creation of too much money and too much credit.’

Number two, if you look at the 60s and the 70s, inflationary policies were already in place in the 1960s, but there is always a lag. So the big increases in the consumer price index took place in the 70s. There was a lag of several years.”

When asked if gold was headed for another big year in 2012, Eveillard, who has such a great sense of humor, responded, “As Benjamin Graham used to say, ‘The future is uncertain,’ which is sort of true. Only God knows and he isn’t telling. I would simply say that the conditions are right for the price of gold to up further.”

When asked about the mining shares specifically, Eveillard stated, “There has been, as you pointed out, such a discrepancy between gold bullion and the behavior of the mining shares. We are at the stage where they should start doing better. So I’m very positive on the mining shares in general.”

Eveillard is a legendary value investor. His long-term track record of success is one of many reasons why he helps oversee more than $50 billion. He has been invested in gold for almost two decades and believes there is much more upside in this bull market. The KWN audio interview with Jean Marie Eveillard is now available and you can listen to it by CLICKING HERE.

Eric King

KingWorldNews.com

To return to BLOG click here.