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Bill Fleckenstein continues:

“This is not to say that all financial companies are worth nothing, but lots of them basically are (worth nothing).  So I think there’s a lot of fluff in the S&P.  But the fact that the market is not hugely expensive is why it seems somewhat impervious to some of this bad news.  Plus, when you have these algorithmic trading programs on the loose, trying to ferret out what the market might be telling you is next to impossible.

Last night, after the Spanish deal was announced, they had the S&P (futures) up what, 1.5%, on this complete air-ball of an idea....

Continue reading the Bill Fleckenstein interview below...


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“Of course, today as we’re speaking they’ve since given that (gain) up.  There is an analogy between the disaster in Europe and America, in that a lot of us knew this euro would never work when times got tough. 

But the fact that it went on as long as it did, through seemingly good times which were mostly money printing inspired bubbles, caused them (Europe) to create much larger mountains of debt because they had more time to do it.  You know if we wouldn’t have had the bubbles that were created by our Fed and others, the Europeans couldn’t have gotten in this much trouble.

Similarly, all of the city, state, county, and government debt that we have, because the debts and contingent liabilities grew large through 15 or 20 years of money printing, has created much bigger problems.  This is a long way of saying, it’s not just the bubbles that these idiots produced that caused the problems, it was (the fact) that nobody focused on the long-term issues during that period and everything just got worse.

Now the whole world is having to face this sort of thing all at once.  Europe is broke and the banks are in trouble.  Maybe not all of Europe, mostly the PIIGS, but so are we and so is the UK and Japan.  The reason Europe is in trouble is because the ECB won’t print unlimited amounts of money like the Fed, the Japanese and the British do.

I think either the ECB is going to print enough money to keep the euro from fracturing or it won’t.  And then the countries, ex-Germany and maybe a couple of others, will print monstrous amounts of money.  But I think we are kind of getting to the end game.

I notice today, in the wake of this so-called solution, both Italian and Spanish debt is being hammered.  Italy is up to 6.5% and Spain is up to 6%.  So, since those are the numbers where things are supposed to rapidly escalate, it’s kind of game on in that department.”

© 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.

This interview is Fleckenstein at his best.  He covers many markets including stocks, gold, silver and the mining shares.  He also discusses what central planners are up to and what KWN listeners should expect next.  The interview with Bill Fleckenstein is available now and you can listen to it by CLICKING HERE. 

The interviews with Egon von Greyerz and MEP Nigel Farage are available now.  Also, be sure to listen to this week’s line-up of other KWN interviews which include Michael Pento, Dr. Stephen Leeb, Don Coxe ($538 billion BMO), Art Cashin ($612 billion UBS), Rob Arnott (oversees $100 billion), Newmont CEO Richard O’Brien, John Hathaway and James Turk by CLICKING HERE.

Eric King

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