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Rule:  “Every time I see something about gold in the mainstream media I’m afraid we haven’t hit a capitulation point yet.  But the questions they are asking about the gold market are good questions.  I can’t help but wonder why it takes them seven years to get delivery when the Germans want 1,200 tons of gold that they’ve already paid for....

Continue reading the Rick Rule interview below...


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“When the Chinese go into the market and buy gold, they get delivery of 1,120 tons of gold in one year.  This doesn’t make any sense to me.

The most obvious explanation is that the gold  stored for the Germans has been hypothecated or lent (and already sold into the market).  So the US Fed has to receive it back from its loans before they (the Fed) can give it back to the Germans.

It is interesting to me as an American citizen, and by the way a substantial taxpayer, that the government doesn’t think I have a right to know this.  They don’t think that I have a right to understand anything with regard to the gold that is allegedly stored in Fort Knox on my behalf as a US citizen.

I would prefer to know that and I’m sure German citizens would prefer to know that.  But for some reason the Fed has chosen not to make that information available to us.  I think questions like that are big enough questions and obvious enough questions that they are even of interest to the readers of major metropolitan dailies.”

Rule added:  “The macro issue that is of interest to me is the unsustainable level of government expenditures relative to revenue -- and the fact that they are bridging the gap via either the sales of debt, or in the case of the United States government by quantitative easing, which I would refer to as counterfeiting.

The other major issue I see is the artificially low level of interest rates, where governments are collaborating to steal money from savers and earners and give it to spenders.  I understand that this is the nature of a democracy, that there are certainly more spenders than there are savers.  But I wonder how long we can go before we have an ‘Atlas Shrugged’ moment where you wound the savers in an egregious enough fashion that they begin to alter their behavior.

I expect that global markets will be continually volatile from this point forward because of the juxtaposition between a liquidity-driven rally and very poor underlying economic conditions.  These two conditions -- underlying liquidity and the ugly solvency issues -- resemble two very strong storm systems that are colliding.  When two storm systems collide, they create extremely volatile conditions, and this is the type of turmoil I expect from global markets in the future.”

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© 2014 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 James Dines, Gerald Celente, Michael Pento, Eric Sprott, Andrew Maguire, Rob Arnott, William Kaye, David Stockman, Rick Rule, John Mauldin, Egon von Greyerz, Art Cashin and Dr. Marc Faber are available now. Other recent KWN interviews include Jim Grant and Felix Zulauf -- to listen CLICK HERE.

Eric King

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