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Pierre Lassonde - Don’t Panic, This Is Normal Trading In Gold
With gold trading down roughly $40, today legendary Pierre Lassonde spoke with King World News about the recent action in gold and what investors should expect going forward. Lassonde is arguably the greatest company builder in the history of the mining sector. He is past President of Newmont Mining, past Chairman of the World Gold Council and current Chairman of Franco Nevada.
Lassonde is one of the wealthiest, most respected individuals in the resource world, and as always King World News would like to thank him for sharing his wisdom below with our global readers. Here is what Lassonde had to say about the action in the gold market: “We’ve been in a bull market for the past 10 years. It’s been absolutely exceptional. So these little movements like $30, $40, frankly, with gold near $1,700, you are talking about less than a 2% move. In the grand scheme of things these are very small moves.”
© 2012 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 This material may not be published, broadcast,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.
November 2, 2012
Pierre Lassonde continues:
“If we were talking about a 20% correction, that’s significant. But 1% or 2%, I don’t even think about it. You have to superimpose the monthly ebbs and flows of gold. Usually gold goes up in September, it comes down in October, then it goes back up by the end of November and into Christmas.
What we are seeing are just cyclical monthly moves that happen every year....
Continue reading the Pierre Lassonde interview below...
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“We saw gold ramp up in September, now we are seeing the October move, with gold backing off a little bit. This type of action has to do with the Indian wedding season and the Chinese buying. So as I said, these are normal ebbs and flows, but in the end these are really small moves.
As far as I’m concerned the macro picture is still very bullish. We are in the middle of a long cycle for commodities. I think we are in the middle of what will end up being a 20-year cycle. In the middle of this we are seeing a commodity slowdown.
So I think we are just in the middle of a long-term bull cycle. If you look at the last 200 years, there have been seven or eight commodity cycles. But the average commodity cycle is about 20 years. So I think this one will be about a 20-year cycle and we are in the middle of it. But every one of those had a mid-cycle correction.
But when you look at gold, at the end of the day, 80% of the value has to do with the US dollar. And when you look at the way the Fed is printing money, they are throwing QE1, QE2, and QE3 at this now, you still have to be very bullish.
Moving to Europe, if you look at the liabilities in Europe, the French, the German pension fund liabilities are enormous. The Europeans like to talk about their debt-to-GDP being 100% of GDP, but their pension fund liabilities are (a staggering) 350% of GDP.
The French pension fund is going to run out in 8 years. How do you think they are going to pay for it? So you have to be very bullish. You just have to be very bullish on the price of gold.”
This is what I like about the great ones like Lassonde, they never panic. For what it is worth, gold is now nearing the $1,660s target that Citi analyst Tom Fitzpatrick had been predicting on KWN since the highs near $1,800.
© 2012 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.
The interviews with Stephen Leeb, Don Coxe (BMO $538 billion), Rick Rule, James Turk, Egon von Greyerz and Gerald Celente are available now. Also, be sure to listen to other recent KWN interviews which included MEP Nigel Farage, Jean-Marie Eveillard, Bill Fleckenstein and Art Cashin (UBS $612 billion) by CLICKING HERE.
Eric King
