On the heels of another plunge in the gold and silver markets, today legendary Pierre Lassonde stunned King World News when he openly discussed manipulation of the gold market. Lassonde also spoke with KWN in great detail about the gold and silver smash and what he invested $10 million of his own money in today. Lassonde is arguably the greatest company builder in the history of the mining sector. He is past President of Newmont Mining, past Chairman of the World Gold Council and current Chairman of Franco Nevada.
Lassonde is one of the wealthiest, most respected individuals in the gold world, and as always King World News would like to thank him for sharing his wisdom with our global readers during this critical period in these markets.
Lassonde: “In terms of what’s happening, there is a battle between the deflationists and the inflationists. Gold has always been an inflation hedge because it’s the anti-dollar. The deflationists believe there is too much debt and it’s going to collapse in on everybody and we are going into a depression like the 1930s….
Continue reading the Pierre Lassonde interview below…
“The debt levels that we have in the developed economies are so high that it is now creating more volatility than ever. That’s why we see these huge swings in the market from euphoria to depression and people don’t know which way to run anymore.
But in order for investors to make rational decisions in these unprecedented times, they must keep a level head and ask themselves the following question: ‘What’s changed?’ Well, Europe is still a basket case and Greece is still going to default at the end of the day. It’s impossible for the Greeks to get out of the vicious cycle they are in because they can’t reduce their debt, so their Debt/GDP keeps going up.
The next country after Greece to default will be Italy. The economy is not growing in Italy. In the meantime their debt level keeps growing — they are already at a staggering 130 – 140 percent Debt/GDP, and we are talking 2 trillion euros so the Germans cannot save them. So nothing has changed in Europe. In fact, if anything the situation has gotten much worse over time.
In Asia you have a real crisis because the Japanese are printing money today at the same rate as the Germans were in the Weimar Republic back in the 1920s and that led to a destructive hyperinflation. But Japan is creating a huge problem for China because the Japanese are trying to devalue their currency at a time when China is trying to stabilize theirs. If the Chinese respond by trying to devalue their currency against Japan’s, then it’s going to erupt into a massive currency war in the Far East. At that point the whole debt edifice they have built could come collapsing down.
This is why the U.S. dollar is going up. People are looking around the world and seeing the United States as the refuge in terms of currencies. But that is going to cause major problems for the Fed and the government because the stronger the dollar becomes, the more jobs will be exported outside of the country, and the higher the trade deficit. So this will lead to a huge crisis for the United States.
So nothing has changed fundamentally, Eric. With the kind of money printing that we have already seen, inflation is going to show up at some point in the system. And when the inflation comes it will seemingly come out of nowhere and it will be brutal — like a thief in the night. By the time people catch their breaths the gold price will already be up $500 and the underlying shares will have tripled or quadrupled from current levels. So people need to remain calm and not let their emotions cause them to make bad decisions.”
Eric King: “Pierre, earlier today I spoke with a former board member of Paine Webber who also worked for Goldman Sachs 25 years ago, the very highly respected William Kaye, out of Hong Kong. Kaye said the following about today’s smash in gold:
“This is something that you see in precious metals when there is clear evidence of manipulation. We saw 30 tons of gold sold at 2 PM Hong Kong time. That is a time in which no one does any real trading. What Asian trading is going to take place is already done by that time of the day. At that time of day people are simply waiting to hand things over to London in a few hours. Regardless, an awful lot of paper gold was intentionally dumped in a pre-programmed algorithm. This was most likely done by the Bank for International Settlements. This was designed to condition
the paper market by forcing the price lower. It was also designed to set the
market up in London to open up at lower levels.”
Eric King continues: “He is saying that somebody is in there manipulating the price of gold and they are doing it at a very high level (the BIS). I’m just wondering if you are pissed off enough to talk about this?”
Lassonde: “It would not be the first time that we’ve seen this and it won’t be the last time either. There is obviously an entity or trading house who must have a short position and they are using the paper gold market to move the price. And if it’s a fragile market they are going to get their way for a while. So they are making moves in this market and it’s working because the market is very fragile.
But let’s not lose sight that at the end of the day it’s going to be the Indian or Chinese woman who walks into a store, buys an ounce of gold and takes delivery that will ultimately fix the price of gold. The Chinese have been huge buyers of gold, and that’s 60 – 65 percent of the entire gold market in those two countries — China and India. People have to remember that China and India are growing. China, even with it’s problems, is still going to grow at 6 or 7 percent per year. This means that the gold market in China is going to grow at 10 or 12 percent per year.
But is there someone trying to make the market go their way in order to make some money? Yes. And when the gold price starts to turn around they will do the opposite — they will go long and they will take the price higher. That’s what they do and they are professionals at it.”
Eric King: “Pierre, what are you doing with your own money right now during the smash?”
Lassonde: “I just put $10 million into the market today in gold equities. I can’t help myself. From now until early December is the best time to buy shares because people are literally throwing the shares away. By the end of December the market will turn around, and at some time between January and March you will double your money.”
IMPORTANT – KWN will be releasing interviews all day today.
© 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 Andrew Maguire, Eric Sprott, Rick Santelli, Bill Fleckenstein, Rick Rule, Michael Pento, Dr. Paul Craig Roberts, Andrew Huszar, MEP Nigel Farage, John Mauldin, Egon von Greyerz, Michael Belkin, and Marc Faber are available now. Other recent KWN interviews include Jim Grant and Felix Zulauf — to listen CLICK HERE.