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Caesar Bryan - Central Banks Aggressively Buying Gold

With gold trading $20 higher and silver solidly back above $32, today King World News interviewed 25 year veteran Caesar Bryan. Gabelli & Company has over $31 billion under management and Caesar Bryan has managed the gold fund since its inception in 1994. Caesar told KWN that central banks have been aggressively accumulating physical gold into weakness in the paper price of gold. Caesar went on to discuss silver and the mining shares as well, but first here is what he had to say about gold: “Well, there’s been a bit of a transfer from the paper players, those involved on the COMEX and in the futures market who have been liquidating. On the other hand, the physical buyers, including central banks, are stepping in to accumulate gold.”

Caesar Bryan continues:

“The central banks have been accumulating a great deal of physical gold at these lower levels. So there’s a bit of a tug of war going on between the futures market and the physical market. It’s really gut-wrenching what has taken place. Yesterday was a very disappointing day for some of my equity holdings.

When you start to feel sick to your stomach, that is usually a good sign and means we are going to get some kind of bounce....

Continue reading the Caesar Bryan interview below...

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“This has been really horrible and investors have to be patient. They can’t be shaken out on these gut-wrenching downward movements.

What we’ve seen is some optimism surrounding the US economy. This has led to people now thinking that the Federal Reserve can stop expanding their balance sheet and indeed begin to withdrawal some of their stimulus.

So there’s been a pretty big change in the last six weeks. However, I think it’s important for investors to understand these mood swings can be pretty quick and violent. What we need to bear in mind is the macro backdrop and that is still firmly on the side of the central bank remaining very active in terms of stimulus.

What does that mean? That means they will not be doing anything in the short-term regarding interest rates and they will not be withdrawing liquidity. In fact, I believe they will be adding to liquidity.

There is real pressure for the central bank to continue to buy at the long end of the bond market to prevent long-term interest rates from rising. So don’t be surprised in the next couple of months when psychology shifts back to people thinking the Fed will remain active.

That’s just here in the US, internationally the European crisis is nowhere near being solved. The Japanese are also now expanding their balance sheet, along with England and Switzerland.”

When asked about silver, Caesar responded, “There seems to be a decent bid. Silver is back above $32, which I think is an excellent price for our two main silver investments, Hochschild and Fresnillo, which are both listed in London.”

When asked about the mining shares specifically, Caesar stated, “These shares are probably near a bottom. Valuations are extremely attractive and these stocks are extraordinarily cheap relative to their history.

The action has been so poor and what has been so disappointing is that bad news is still being greeted with the shares being marked down on an individual basis. It will be nice to see that trend reverse. If you are holding the mining shares, be patient. These equities will come back and they will come back strongly.”

To learn more about Caesar Bryan, his management services and the Gabelli Gold Fund CLICK HERE.

Eric King

KingWorldNews.com

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