Today John Embry told King World News that customers holding “allocated” gold inside certain banking institutions have had their gold “loaned out.” Embry, who is Chief Investment Strategist of the $10 billion strong Sprott Asset Management, also told KWN, “Many of these customers will wake up one day and realize they entrusted their gold to the wrong people.” But first, here is what Embry had to say about what is happening in Europe and how it is impacting gold: “The pressure will be on the Germans today to fall off the austerity kick. The only alternative will seem to be that Germany will have to leave the euro and they are really not in a position to do that. The solution to keep the thing together is going to be more and more money creation and this is extraordinarily bullish for gold."
“I don’t think the public realizes how explosive this gold scene is. There are three factors that are going to come together that will lead to a rise in demand for gold that is going to absolutely stun the investing public. The first is the need to continually print money in order to keep the system together.
You can name almost any country in the world and they all are infected with the same problem. They have far too much debt and they have no way of dealing with it other than to print more money so the existing debt doesn’t crash.
But at the same time, 99% of the public doesn’t recognize what’s going on. They are sitting comfortably in their paper instruments, suffering from cognitive dissonance and believing all of the propaganda from the mainstream media....
“Right now I think gold and gold related assets constitute materially under 1% of all financial assets. When you get a real bull market going, you’ll get that up to 5% to 10%. When people panic out of paper and into gold, that’s going to have a huge impact.
To top it off, there’s this massive amount of paper gold sitting out there. We’ve seen the numbers of 100:1 paper gold to underlying physical gold. Who knows what the number is? I wouldn’t be surprised if the number is higher than that if you factored in all of the derivatives.
But it doesn’t make any difference because these people that think they are protected by holding paper gold, when they really need it they are going to discover they don’t have anything other than paper. That will create yet another source of demand for physical gold.
So you put the three big things together and you can easily underwrite gold prices in the future that people today can’t even imagine in their wildest dreams.”
When asked about the mining shares, Embry responded, “I honestly believe that this is the finest buying opportunity I have ever seen in the gold stocks in my career. I say that because I think we are on the cusp of a major explosion in the gold price, and the mining shares are just being thrown overboard. This is really an astounding disconnect, I’m amazed by it.
If I’m right and the gold price stages a major breakaway to the upside in the next few months, the moves in the gold stocks will be heroic. It’s really hard for people to imagine that because they’ve just been relentlessly pounded, month after month. As someone recently pointed out, this is the cheapest the gold stocks have been in the last 100 years.”
Embry also added: “It was an interesting interview with Egon von Greyerz that you had on KWN in the last couple of days. I know him quite well and I can tell you I have the highest regard for him. He was talking about the man that went to his Swiss bank to get his allocated gold out, and they couldn’t give him the gold because the bank didn’t have it.
What he didn’t mention in his interview is that when the customer finally got his gold, it was 2011 minted bars. This made no sense because he had been holding the allocated gold for years. That’s just another example that even the allocated gold in the banking system has probably been loaned out. Many of these customers will wake up one day and realize they entrusted their gold to the wrong people.”
World King News
“Right now I think gold and gold related assets constitute materially under 1% of all financial assets. When you get a real bull market going, you’ll get that up to 5% to 10%. When people panic out of paper and into gold, that’s going to have a huge impact.
To top it off, there’s this massive amount of paper gold sitting out there. We’ve seen the numbers of 100:1 paper gold to underlying physical gold. Who knows what the number is? I wouldn’t be surprised if the number is higher than that if you factored in all of the derivatives.
But it doesn’t make any difference because these people that think they are protected by holding paper gold, when they really need it they are going to discover they don’t have anything other than paper. That will create yet another source of demand for physical gold.
So you put the three big things together and you can easily underwrite gold prices in the future that people today can’t even imagine in their wildest dreams.”
When asked about the mining shares, Embry responded, “I honestly believe that this is the finest buying opportunity I have ever seen in the gold stocks in my career. I say that because I think we are on the cusp of a major explosion in the gold price, and the mining shares are just being thrown overboard. This is really an astounding disconnect, I’m amazed by it.
If I’m right and the gold price stages a major breakaway to the upside in the next few months, the moves in the gold stocks will be heroic. It’s really hard for people to imagine that because they’ve just been relentlessly pounded, month after month. As someone recently pointed out, this is the cheapest the gold stocks have been in the last 100 years.”
Embry also added: “It was an interesting interview with Egon von Greyerz that you had on KWN in the last couple of days. I know him quite well and I can tell you I have the highest regard for him. He was talking about the man that went to his Swiss bank to get his allocated gold out, and they couldn’t give him the gold because the bank didn’t have it.
What he didn’t mention in his interview is that when the customer finally got his gold, it was 2011 minted bars. This made no sense because he had been holding the allocated gold for years. That’s just another example that even the allocated gold in the banking system has probably been loaned out. Many of these customers will wake up one day and realize they entrusted their gold to the wrong people.”
World King News
No comments:
Post a Comment