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Caesar Bryan continues:
“Meanwhile, we’ve had the news that the Korean Central Bank has added 16 tons of gold to their reserves. But the key here is we can now emphatically state there is absolutely no question that central banks now, on dips, want to add to their reserves.
We also have other key central banks around the world continuing the policy of debasing their currencies, and this continued debasement is a clear signal to these other central banks to keep on accumulating gold. This has to be troubling to the gold bears. The bears have made repeated attempts to break down the gold price, but all attempts have failed.
So this is a perfect setup for the gold price to move higher, not only in US dollars but also in terms of other currencies as well....
Continue reading the Caesar Bryan interview below...
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“The trade balance came in lower than expected, Eric, at $42.9 billion. The expectation was $47.5 billion. Initial jobless claims were a little better than expected.
With news like this as the backdrop, gold stocks have been performing better as of late. I should add that the European situation is not solved, despite a rally in rates in some of the rates of the Southern periphery countries. Yields have come down from very high levels, but remain very volatile.
It’s going to be an interesting autumn because we do not have an agreement as to what is going to happen in Europe. There’s been a lot of talk and things have been heating up politically, particularly if you read what Mr. Monti has been saying.
Neither Spain nor Italy are keen on being helped with conditionality. So the Germans are saying, ‘Right, come to us,’ in the case of Spain, ‘and we’ll impose conditions on you and then the central bank can buy your paper, especially at the short end of the curve.’
The Spanish are not keen on this at all, and obviously the Italians are not excited about this either. So politically it could get quite interesting. Meanwhile, we have a ruling, I believe it’s on September the 12th, from the German Constitutional Court as to the legality of part of the bailout fund.
So there’s going to be a lot of headlines out of Europe over the next few months. This will be supportive for gold because the pressure is going to be on the ECB to provide liquidity and buy the debt of the peripheral countries. This liquidity will be an attempt to narrow the spreads to allow those nations to refinance themselves.
On the other side of the Atlantic, in the United States, the prospect is for further Fed action in the fall. So all of the central planner activity going forward should be extremely constructive for the gold price.”
Caesar also added: “We’ve been discussing how inexpensive the gold miners are vs the gold price. We believe the miners are beginning to slowly outperform the gold price on an absolute basis. We’ve had a number of results come in from companies and it has been a mixed bag in terms of earnings, but all of the results have been reasonable.
There is no question in our mind that investors should be accumulating quality mining companies that are undervalued. We believe those quality companies should perform extremely well in the fall.”
© 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.
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Eric King
Gold Bears In Trouble As Central Banks Continue Buying
With market participants eagerly waiting to see if gold and the mining shares will have a major breakout during the month of August, today King World News interviewed 25 year veteran Caesar Bryan over at Gabelli & Company, which has over $31 billion under management. Here is what Ceasar had to say regarding the gold market, Europe, the US, and mining shares: “The gold price has continued to trade over $1,600 as of late. It seems to be putting in higher lows since May, and I would expect the gold price to perform pretty well as the summer ends and we come into the seasonally strong time in autumn.”
© 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.
August 11, 2012
