Click here for the KWN interview page with Egon von Greyerz – then click the ‘Listen to MP3’ link
In summary, this is what I said (with some additions):
- The current correction in gold is technical. There is very little physical selling and refiners have their order books full well into the second half of 2012.
- Technically this correction could last to the end of the year but it could end already at the end of next week. Support is at $1,530-50 and $1,410-20. Thus we could go that far down but this would be a golden opportunity to add to positions.
- The market is smelling deflation. With no QE we would have a deflationary collapse. No bank would survive a deflationary collapse. Nor would any government. There would be total chaos and no functioning financial system.
- Governments are petrified of deflation. They know the consequences which are unacceptable to them.
- Therefore, whatever governments say, there will be unlimited money printing led by the Fed, IMF and ECB plus other central banks.
- QE will not solve the problem, only kick the can down the road. There is no solution as I wrote in my latest piece “Deus ex Machina”.
- Worldwide QE will lead to currencies collapsing, a hyperinflationary depression and surging precious metals.Physical gold and silver (stored outside the banking system) is the ultimate method for preserving wealth.