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Rick Rule continues:

“This seems to be a worldwide phenomenon.  One would expect the gold market to react to news like that, and sure enough we have both gold and silver on the move in the aftermarket.  The indication here is that we are going to see more money printing, and therefore the major currencies will become worth less.  That, of course, means gold becomes worth more.

I think it’s tragic that they are destroying the currencies, but that’s what’s happening.  It not only destroys the currency, but it also destroys the fabric of a country....

Continue reading the Rick Rule interview below...


To hear what billionaire Eric Sprott & Rick Rule are doing with their own

money and which $10 billion company John Embry &

Dr. Marc Faber oversee click on the logo:

“One of the things that happens with this easing is it forces interest rates unrealistically lower.  So people who have saved their whole lives are penalized for saving, and their standard of living is lowered as a consequence of these policies.  This is not the sort of thing that made America or Europe great.  It’s a tragedy.”

When asked about what he is doing with the money he is overseeing, Rule responded, “We’ve been fairly consistent at Sprott with hoarding some of our cash with either physical bullion or bullion proxies, like Sprott Physical Gold or Sprott Physical Silver.

It has been the case, up to now, that we have been punished for buying shares of the senior gold producers, but one would expect them to perform well in the face of higher gold prices, at least over time.   We have also been very active in buying the developmental stage producers that are selling at substantial discounts.

I would suspect we will continue with that investing.  The gold equities are up nicely in the last two weeks, but I suspect they still have room to play catchup.  We will also continue to increase our bullion position on down days in the market.

I think it’s very necessary for KWN readers to understand that a rally like we are seeing right now, is a rally for selling the mistakes that you made, which were too painful for you to sell a month ago.  We have a long way to go before this market is healthy.”

Rule also added: “Eric, I think one of the things that happens on a day like today is you rattle people’s nerves.  Nerves have been steadied simply because of the incredible influx of liquidity that we’ve seen in the system.  But you can only paper over a solvency problem with liquidity for a short period of time.

Unfortunately, for all of us, the Federal Reserve action, and the action of the European Central Bank, of adding liquidity to a market that has a solvency issue will not have a happy ending.  But it will have a happy ending for KWN readers who understand the situation, and take what precautions they can to protect their own portfolio.

This includes keeping good cash positions in case of a psychotic breaks in the market and maintaining a position in physical gold and silver.  And for those who can take the risk, speculating in gold shares or junior mining shares.  I think those are essential parts of a portfolio.”

Rule had this to say about the surge in crude oil:  “There are two reasons for that.  In the first instance, the very thing we have been discussing today, money printing, has been helping the oil price.  The second thing is there is real, ongoing tension between the United States and Iran, and Israel and Iran.

The upset that is happening in Syria also confuses the situation.  If there were hostilities in the Persian Gulf that threatened the Straits of Homuz, where more than 50% of the world’s export crude travels, the world oil quote could skyrocket.”

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© 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 Gerald Celente, Ben Davies, Rick Rule, Egon von Greyerz, Bill Fleckenstein and Dr. Keith Barron, are available now.  Also, be sure to listen to last week’s line-up of other KWN interviews which included MEP Nigel Farage, Peter Schiff, John Embry, James Turk and Micheal Pento by CLICKING HERE.

Eric King

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