John Hathaway continues:

“I think we are definitely in the liftoff phase here.  Most people have been out of gold.  They’ve been liquidating for the past year.  Suddenly you are starting to see all kinds of high profile people discussing gold, such as hedge fund manager Ray Dalio.  Ray was mentioned as being in favor of gold. 

I think most people missed this rally.  You can tell by the way gold has acted....

Continue reading the John Hathaway interview below...


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“Most people are not aboard.  They are going to climb aboard stocks because that’s the next best thing to do if you didn’t catch the move in gold.   We know the mining shares got down to ridiculous valuations, and they are just now beginning to climb back.  But they still remain very cheap.  The moves in the HUI and the XAU support what I am saying.

It now looks like gold has put in a low.  People have finally figured that out.  Now the question is what are they going to do about it?  For me what it means, at $1,700 gold, and mid $30 silver, the companies are not really at risk of a big decline in the metal prices.  

So I think you are going to see, over the next several weeks, maybe months, a revaluation of the shares.  Investors will figure out that the shares are still undervalued and that gold and silver have a very good chance of going higher.  That will create momentum in the shares over time.  We are already up six straight days on both the HUI and the XAU.  This bodes very well for the future.

My view is that gold goes to new highs, and I’m feeling more and more comfortable saying it can happen this year.  I think if that happens you are going to see silver testing its old highs (of $50), and maybe pushing through that level.  So there is plenty of upside in both gold and silver.

The pessimism in both gold and silver is fantastic news for the bulls.  Pessimism is our best friend.  Most people did not see this coming.  Many people I have spoken to had liquidated.  But that’s what makes a bull market, sold-out-bulls get outfoxed by market action.  The skepticism is just part of that, and I think the setup is tremendous.

I’ve always thought the distance between $1,600 and $2,000 wasn’t that much for gold to travel.  We have great fundamentals right now, and people are finally starting to understand we are hooked on QE.  There are a lot of reasons why new money is going to come into gold.  The media coverage is great.  Suddenly CNBC likes gold again.  But, again, the reality is that nobody is on board.  That’s the big thing to remember, this has all happened very, very quickly.”

Hathaway also added:  “This is a terrific breakout in gold.  I think we are at the beginning of a leg that is going to take gold much higher.  The fundamentals which have driven this market have never gone away.  You inject some instability in China into the whole picture, and you have the ingredients for a huge move.

I just don’t think $2,000 is a convenient stopping point.  In my opinion, $2,000 gold will happen quickly.  We will have little setbacks along the way, but I think the stage is set for a much higher move in gold.  We have been correcting for a year.  We will probably play around with the old high, which was a year ago at around $1,900, but when it’s all said and done, gold will see new highs and I think it will see them this year.”

© 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 Bill Fleckenstein, Egon von Greyerz, Felix Zulauf, Rob Arnott, Michael Pento, Gerald Celente, James Dines and Marc Faber are available now.  Also, be sure to listen to last week’s line-up of other KWN interviews which included James Turk, Art Cashin, Egon von Greyerz, and Sean Boyd by CLICKING HERE.

Eric King

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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.

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