Leeb:  “Everyone is focused on the US government, and whether the delinquents can really get their act together.  It would seem, at first glance, that gold should be going through the roof.  The mightiest country in the world is clashing in a way that’s taking us to the precipice of what could be an absolutely calamitous economic event....

Continue reading the Stephen Leeb interview below...


To hear which company in the gold sector is the single largest holding of

World-Renowned Investment Strategist John Embry

and why click on the logo:

“The markets are saying we are probably not going to go over the precipice.  Stocks have been under pressure, but it’s not necessarily the kind of pressure that says we are going to come unhinged.  But having said that, you would expect gold to have a much stronger bid than it does.

Volume in gold is light right now because the Indians have been strong-armed and forced to back away from the market a bit.  The Chinese continue to buy incredibly aggressively.  China just imported a staggering 131 tons of gold into Hong Kong.  The important thing to remember here is there are a lot of other ways the Chinese get gold outside of the stunning Hong Kong imports.  The Chinese have a lot of buying still to come.  I told you last week that they are going to accumulate another 5,000 tons of gold. 

Consumers in China are feeling a little bit better because wages are picking up.  But, importantly, China sees an urgency to get as much gold as they can as fast as they can.  The Chinese know what’s going to happen if the US defaults.  If it’s not this time, will it be the next time, or the time after that?  The Chinese are not concerned about what’s going to happen with the price of gold in the next 5 days -- they are more concerned about what’s going to happen to the price of gold in the next 5 years.

I think that this has really accelerated their need to acquire gold, but also their willingness to let gold prices soften.  It wouldn’t surprise me if the Chinese were doing some paper selling just to weaken the market a little bit.  I know the Chinese want gold, as fast and as much as they can possibly acquire.  But the need to acquire large quantities of gold has become more important to the Chinese because they see the trouble the US is in.  It’s perfectly clear to the Chinese that the situation in the US is unsustainable.  Everything from the energy policy, to Obamacare, the US doesn’t have its act together.

The Chinese know this and it has caused them to realize that they have to accelerate their schedule in terms of accumulating large amounts of gold.  The Chinese have a big conference in the next 30 days or so.  They will lay out their priorities, but I predict they won’t say a thing about gold.  Front and center right now the Chinese want gold, but they are not going to say that.

If anything, the Chinese will want to show a little weakness in the gold market so they can buy it in large quantities, and at highly discounted prices.  This may frustrate long-term holders of gold, but they just need to be patient while this plays out.  The reason the Chinese can get away with having a softer gold market is because the natural buyers, the individuals such as John Paulson, they are out of the market.

People like Paulson already have their positions and they are not going to step in and support the price.  But every single dollar lower in the price of gold from here will be dwarfed when the price turns around and heads to the upside.  It wouldn’t surprise me at all to see gold trading ten times higher than current levels years from now.  So this is just noise we are seeing right now in the gold market.

These are moves that are manipulated, and they are just positioning in gold.  In the end there will be a dramatic reversal.  With all of that being said, I don’t expect gold to go much lower from here.  Gold could test the lows, but we are talking about roughly 5% at the most.  That’s a very small number in the big scheme of things. 

Against that, we are talking about gold heading possibly ten times higher from current levels.  So the risk/reward ratio hasn’t changed at all in gold.  In fact, it’s dramatically positive and if anything it’s getting more positive.”

Leeb also added:  “Silver for photovoltaics is expanding enormously right now.  Demand for silver in this sector has nowhere to go except higher.  This is going to drive the price of silver over $100.  I do expect for silver to be stronger than gold over the next year or two because of this explosive situation. 

It wouldn’t surprise me at all to see the price of silver hit $110 in the next 24 months.  The price of silver is going to super-surge.  But the mainstream media will be saying it is because of massive demand for photovoltaics -- they won’t be admitting that it’s also because the financial system going to hell.”

© 2013 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 audio interviews with Egon von Greyerz, Bill Fleckenstein, David Stockman, Robin Griffiths, Jim Grant, Gerald Celente, William Kaye, Dr. Paul Craig Roberts, Chris Powell, Michael Pento, Eric Sprott and Grant Williams are available now. Also, other recent KWN interviews include Marc Faber and Felix Zulauf to listen CLICKING HERE.

Eric King

To return to BLOG click here.

© 2013 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.

Subscribe to RSS
KWN Blog