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Caesar Bryan continues:

Gold had spiked from the mid-$1,500 area to $1,800, so it had gotten a little ahead of itself. Well, sure enough gold has taken a hit, and broken through its 50-day moving average which was at $1,723. Whether gold needs to go down to its 200-day moving average near $1,660 remains to be seen. I hope not.

But from a longer-term standpoint, the bullish case for gold has never been stronger....

Continue reading the Caesar Bryan interview below...

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“In October the Federal Reserve began its $40 billion program of buying mortgage securities. I believe in the week ending in the middle of October, the Fed had bought $27 billion of mortgage-backed securities. So the Fed is expanding its balance sheet.

Now, the ECB has not embarked on its outright monetary transactions of the purchase of government bonds in Europe because Spain has not yet sought help. The ECB is continuing to push for conditionality. So they want Spain to ask for help, and then impose conditions on Spain, then they will buy the bonds.

That hasn’t happened yet, but I think it will, and when it does it will be tremendously supportive for gold. Just remember the ECB’s balance sheet is now $4 trillion, and is also continuing to expand.

I would also add that the Bank of Japan is under tremendous pressure to be more active, and to lower the value of the yen. This was reflected in last week’s 5.5% rise in the Japanese stock market, which was accompanied by a 1.4% fall in the value of the yen.

One way for the Japanese to accomplish this would be to purchase foreign bonds through the printing of yen. So a similar maneuver to what we saw from the National Bank of Switzerland when they pegged their currency to the euro and said they would print as many Swiss francs as necessary to maintain the peg.

So we have the developed world targeting inflation, and expanding their balance sheets, all in an attempt to devalue their currencies. Currencies wars are continuing to rage, and the reality is this is a very positive environment for the gold price. In terms of the recent price weakness, some of that has been accompanied by the decline in the yields of both Spain and Italy.

From August 10th, the Italian 10-Year bond has fallen to 4.85% from 5.9%, and in Spain it’s tumbled to 5.75% from 6.9%. There is a feeling that as these rates come down, there is less likelihood of a bailout being needed for Spain. I think the longer this goes on, the more likely it will be the reverse.

So there is this game of chicken going on, but I’m not sure that’s sustainable. I’m sure at some point the ECB will embark on purchases of sovereign debt in a major way, and that will also be extremely constructive for the gold market medium-to-long-term.”

Bryan had this to say regarding the mining shares: “I think the action in the miners has been pretty decent. The XAU has moved from the 140 level at the end of July, and recently the index had risen into the 190s. The XAU is now just below 180.

But, importantly, the XAU has solidly outperformed gold from that late July time frame to the end of September. Also, during this pull back in gold, the shares have maintained their relative outperformance vs gold, which is quite positive.

Over the next twelve months I think there is every opportunity that gold equities will be explosive on the upside as gold moves to new highs. The bottom line is the gold shares have been a good story over the last three months.”

The interviews with Gerald Celente, MEP Nigel Farage, Dr. Stephen Leeb, Rick Rule, James Turk, Jean-Marie Eveillard and Bill Fleckenstein are available now. Also, be sure to listen to other recent KWN interviews which included, Art Cashin (UBS $612 billion), Jeffrey Saut (R.J. $360 billion) and John Embry by CLICKING HERE.

Eric King

KingWorldNews.com

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Currency Wars Continue To Rage & This Is Positive For Gold

Today 25-year veteran Caesar Bryan told King World News that “Currencies wars are continuing to rage, and the reality is this is a very positive environment for the gold price.” Bryan, from Gabelli & Company, also said, “...the bullish case for gold has never been stronger.”

Here is what Caesar had to say: “When we last spoke, Eric, I outlined the fundamental bullish case for gold. I believe the gold price is going to go significantly higher over the next six months. The gold market had reached a point of being overbought when it was up at the $1,800 level.”

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October 25, 2012

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