Embry: “What I’m looking at now is this whole world economic situation.  The powers that be would have you believe that we are in a nascent recovery and it’s going to gain strength.  I believe there will be no recovery of any magnitude in the world economy for the simple reason that there is far too much debt....

Continue reading the John Embry interview below...


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“One of the most important tenets of Austrian economics, of which I am a true believer, is that it takes more and more credit creation to generate a real increase in GDP as you get deeper into an economic cycle, and we are extremely deep into this cycle.

The amount of credit creation that is required to get growth at this point, it can’t even be supported.  We can’t even support the debt load that we have now, let alone massive new quantities of debt.  So the idea that we are going to have a self-sustaining recovery is just fantasy.

I think the Western world, particularly in Japan, is long since past the point of no return.  And China, from all of the financial numbers I look at, may be approaching the point of no return as well.  It is taking more and more credit creation to grow their economy, and clearly they are starting to have major credit problems.

So I’m very comfortable with the idea that there are only two possible outcomes:  A 1930s-style Great Depression, or the path of least resistance, which is where you just keep printing money so that nothing caves in, and that most assuredly will lead to hyperinflation.

Most people who just look at micro-economic numbers can’t conceive of this happening.  They say, ‘The demand in the economy is weak, and therefore we can’t have hyperinflation.’  But hyperfinfation is strictly a currency event -- you print enough money, you destroy your own currency, and the value of the things denominated in that currency goes to the moon -- and I think that’s where we are headed.

I want to discuss the jobs number that was released on Friday.  The jobs release is always an outright lie from the US government.  If you look at the jobs number from Friday and break it down to the true number, the US had the biggest number of jobs lost in January since 2009.  Well, 2009 was in the depths of the depression, coming out of the financial collapse.  So the idea that there is any sustainable recovery in the Untied States is preposterous.”

Embry added: Investors in the gold and silver space have gone through hell for well over two years.  The silver price topped out almost three years ago and then collapsed over 60%.  Gold has also been hammered for almost 2 1/2 years.

Now it looks like the bottom is solidly in and these attacks by the paper players are starting to be repelled.  We still see the flash crashes, where these guys dump an enormous amount of contracts in a minute or two, but they are no longer having any lasting impact.  The price just comes back and establishes a new short-term high.  This is very positive action.

I am also encouraged by the strength that has appeared in the gold and silver space.  I am invested extremely heavily in this space and a number of my holdings have experienced high double-digit gains so far this year.  I am not excited yet because I think many of these are going to go up 5 to 10 times in price, and that’s going to happen in the wake of much higher gold and silver prices.

There are so many paper claims on gold and silver that when this Ponzi scheme is finally revealed for what it is, I think the move is going to be historic.  When people finally realize they have been conned with all these paper products, it will be the very time they need their physical gold and silver.  So this is building into a crescendo and I would expect this to be an interesting year for those who have suffered in the gold and silver space for the past 2 1/2 years.”

Eric King:  “John Ing was telling KWN that we are nowhere near the level of chaos that he expects.  I was just curious about your thoughts on John’s comments.”

Embry: “I read John Ing’s interview and I totally agree with him.  Quite clearly the powers that be still have the public hoodwinked with the constant misinformation and propaganda that spews out of the mainstream media.  None of that is true.  It’s all lies.  And when the reality of what is really happening intrudes on the fantasy, that’s when the real chaos will begin. 

I don’t think we’ve seen anything yet in terms of the what the ultimate chaos will be.  So John Ing is absolutely correct when he warns that the worst is yet to come.  I can assure you the coming chaos will terrify most people.  People were frightened in 2008, but they will be even more terrified when the sh*t hits the fan this time.”

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The audio interviews with John Mauldin, Eric Sprott, Bill Fleckenstein, Egon von Greyerz, Dr. Paul Craig Roberts, MEP Nigel Farage, James Dines, Gerald Celente, Andrew Maguire, David Stockman, 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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