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Jim Sinclair continues:
“The other side is, maybe what we are really going to do is a Harley Davidson burnout where nobody can see anything but a cloud of smoke. I think the Fed has gone too far when they speak to people who do understand enough about what makes these things happen, to know this is just, bottom line, fabrication.
I think they (the Fed) have weakened their position by what they are doing....
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“Remember, this all started with a sound bite from Bernanke, saying things look a little better on the economy and we may not have to put that much attention on QE. So you are really watching the QE debate in the gold price and right now I don’t think gold is believing it.
The gold market is showing more strength than one would have assumed in the face of such a concerted effort. (The Fed Chairman says), ‘We’re going to do QE, but don’t worry, we will know exactly when to do reverse repo’s and it won’t have any affect on anything.’ My God, you drain this economy and you would be looking for the equity markets (the Dow) somewhere around 10,000.”
When asked if the dollar index would take out the lows of 70 to 72 this year, Sinclair responded, “Absolutely. There will be a hell of a fight at 72. This index is a sell as it approaches the 80 to 82 level where there are so many cash dollars for sale that the paper market just gets knocked off each time.
Right now the dollar index has a target, a magnet at 72 and it’s going to go there. The reason this is happening is if you read the english translations of the foreign press, the non US press, it’s almost daily now that you can see the dollar is being replaced in extraordinary ways in international settlement.
So, when you lose that kind of demand to support a reserve currency, then you are definitely going to test its major support points and in my opinion, after a few touches, go through it and lower.”
When asked about recent intervention in the gold market, Sinclair stated, “If gold was to go straight to the $2,111 area, which is the upside magnet pulling on gold, the transparency it would create, where debt monetization (QE) is involved, would simply be more than the central banks want to see at this time.
So their efforts, in my opinion, are not to depress the price of gold, but to prevent gold from rising into the area where it becomes ballistic.”
This is a critical interview with legendary Jim Sinclair because he lets listeners know exactly what level gold needs to breach, in the short-term, in order to break the downtrend in gold. He also discusses the critical elements surrounding the gold market, from the US dollar all the way to the Greek situation. The extraordinary KWN audio interview with Jim Sinclair is available now and you can listen to it by CLICKING HERE.
© 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.
Eric King
Jim Sinclair - Central Banks Concerned Gold Will Go Ballistic
Today legendary trader and investor Jim Sinclair told King World News that the Fed has gone too far and risks losing credibility. Sinclair also said the central banks are doing what they can to prevent gold from reaching a level where it begins to go parabolic. Here is what Sinclair had to say about what central planners are up to and what to expect going forward: “Well it’s amazing that we’ve developed such visionaries in the Fed that they know exactly when to step on the accelerator and exactly when to step on the brake. Then, could they please explain how we got to the point where we need that?”
© 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.
March 8, 2012
