Embry:  “I still believe that gold and silver prices are grotesquely undervalued.  I have been alleging gold and silver manipulation for the past 15 years, and I would dare say that the manipulation today is probably as aggressive as any time in that 15 year period....

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“I suspect it (the powerful manipulation) is for good reason because if the gold and silver prices were to break away to the upside, it would reveal the problems that are present in the system.  The gold and silver prices will break free at some point, but in the meantime there is a massive fight going on at the current levels -- $1,400+ on gold, and $24+ on silver.

I noticed today that the IMF was saying Europe’s economic growth was now coming along, and that it will assist the growth of the U.S. -- so everything is essentially improving.  Well, I don’t believe the Europe is growing significantly at all.

We continually hear all of this propaganda out of Europe that things are better, and yet you look at the level of unemployment and what’s happening on the periphery, and I don’t think things are materially better at all.  The problems in Europe simply won’t go away.  There is infinitely too much debt, and there are such tremendous imbalances in their current system that I don’t see how they can solve it in the current format.

There is no question that the global economy is slowing.  China is slowing down, and when you superimpose that over what is going on in the emerging markets, where their currencies are falling dramatically as money is fleeing those countries, this is creating even more competition for China. 

China has a bit of a problem here because they are less competitive because of the falling value of the emerging market currencies.  So I don’t see any vitality in the industrialized world -- Japan, the U.S., or Europe.  And if you are seeing dramatic slowdowns in the emerging world, as well as Japan and China, this strongly indicates that the global economy is experiencing great difficulty here.  So, despite all of the propaganda, I don’t see how the global economy is going to get out of the serious downturn it is now facing.”

Embry also added:  “The other thing I have been watching closely is the U.S. bond market.  Bonds recently got a bit of a reprieve with the worries about the Syrian situation.  But now the bonds have started to weaken and they look set to challenge the recent lows once again. 

This is the real Achilles’ heel that I think the central planners have at this point.  The one thing the system can’t stand is significantly higher interest rates.  We are going to see how this all unfolds, but my suspicion is that it’s not going to unfold well for them.”

Embry also spoke about silver:  “But what I am really interested in is silver because I think silver is so dramatically undervalued.  There has been a great deal of speculation about how the price of silver was driven down from $30+ to $18, but now it appears to be bouncing back.

I think there is a distinct shortage of physical silver that is developing.  Unlike gold, where central planners can get access to some physical gold to suppress that market, I don’t think that exists when it comes to silver.  So I wouldn’t be surprised to see silver leading gold higher in the future, just like we are seeing today. 

The bottom line here is that silver is tremendously undervalued, demand is solid, and the supply/demand curve is extraordinarily positive for higher prices.  This is exactly why we are now seeing this shortage of silver developing, and if it accelerates, the price of silver will simply explode to the upside.”

Embry closed with this prediction:  “I think this fall is going to be a really fantastic period for gold and silver.  But the thing I find so fascinating is that the sentiment is so terrible at this point, even with the recovery in prices.  You saw that transaction where Gold Fields bought 450,000 ounces of annual production for a mere $300 million, and yet the stock fell 20%.  This shows you how negative the sentiment is. 

The Hulbert Sentiment Index, which used to be published for free, has suddenly disappeared because it was so incredibly bullish for gold.  It’s because the sentiment was so negative.  No one has even spoken about this.  So I’m very excited at this point because the fundamentals are so strong, and the sentiment is terrible.  That’s a powerful recipe for much higher prices, and that’s exactly what we are seeing today.”

IMPORTANT - KWN is about to release another powerful interview with outspoken hedge manager William Kaye.

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