David Morgan-Massive Debt Problem-Were Getting Very Close to the Edge

morganBy Greg Hunter’s USAWatchdog.com 

Precious metals expert David Morgan says, “You cannot print yourself out of this mess that we are in.  We have a massive debt problem, and the only solution they can come up with is ‘add to the debt.’  That will not fix the problem.”  Morgan goes on to say, “The problem is the money will become worth less and worth less and nearly worthless at some point in time.”  Anyone who thinks this can go on for another decade, think again.  Morgan figures, “We’re getting very close to the edge.”  Morgan adds, “There’s a limit as to how much money you can print and still have an effect . . . We’ve reached the limit.”   Morgan predicts, “I do not see hyperinflation, I see more disruption or currency crisis.  You don’t have to have hyperinflation to have a currency crisis.”  Even though Morgan doesn’t see hyperinflation, he contends gold and silver prices will head much higher.  He sees the true price of gold right now “between $5,000 and $7,000 an ounce” and silver at “$100 per ounce.”  Morgan predicts, “I think there is going to be a day in the future that you just can’t get it.  The only monetary asset outside of counter-party risk is physical gold and silver.”  Join Greg Hunter as he goes One-on-One with David Morgan of Silver-Investor.com.

Comments
  1. Lou

    Good stuff, thank you Greg and David!

    However, the main issue I see is this: what is the validity of your contracts? I mean ANY contract? I’m talking about all paper financial instruments. A contract only holds value because we expect the government to uphold its legality – to force those in default to make reparations to the injured party. In 2008, the federal government itself violated the contracts of the stock and bond holders of GM and Chrysler. How can this government have any credibility in upholding the sanctity of contract after that move, alone? Then, the government gave a tax pass on the capital gains to people who had taken out equity loans on their inflated real estate only to default on those loans when their property values fell. The only consequence these people – who were not forced to repay the loans or surrender any material assets purchased with the moneys thereby obtained (or pay the CG tax that is forced on those who honestly earned their money in the markets) – was a credit-rating reduction. But that reduction, which used to last seven years, is almost inconsequential now – two years after such a default, a person can qualify for an FHA loan, now.

    But these are merely examples, and there are many more, but the real issue is the principles that allow these things to occur in our society. More fundamentally, it is the philosophy of altruism that dominates our culture and our legal system, top to bottom. Until altruism is purged from our government – completely and down to its last principle – there can be no sanctity of contract.

    In this interview and many others I’ve seen for years, investment advisors still recommend holding <=20% physical precious metals in your portfolio. In what are we to invest the remaining 80%? In businesses that can be nationalized or regulated at the whim of some government bureaucrat (e.g., health insurance companies)? If it can happen with something as important as health insurance and health care, what argument can be made that nationalization or just outright confiscation cannot happen in any other industry? Remember that the law that has basically nationalized the health insurance and health care industries was reviewed and upheld by the Supreme Court.

    I submit that there is no sanctity of contract at all, and ANY paper instrument has the same validity as the fiat currency of the land. When that crashes, as it must, so will the value of any contracts. Physical possession will be the only way to protect your wealth, and your health. That doesn't sound like 20% to me.

    • Greg

      Lou,
      Thank you for adding your perspective to this post.
      Greg

    • Edward Ulysses Cate

      Absolutely right on, Lou.
      In fact, there was a book published in 1938 “The Promises Men Live By:
      A New Approach to Economics” by Harry Scherman. (In Wikipedia, too)
      It was written and published during very bad economic times, with first hand knowledge of current events.
      The dedication is most appropriate for our times, too:
      To K and T, and to all young people like them who are eager to learn the truth, whatever it may be, about the world they must live in, so that they may not make it worse than it is in trying to make it better.
      If only Bernanke (and others) had read this book in his youth.

  2. sendkeyss

    “You’ve been blocked by the owner of this video or a moderator.”

    Thanks a lot for blocking me. Im guessing it was for the post on greg mannarino. That guy is a loser and a scammer I didn’t lie on bit.

    Goodluck with your website you lost a subscriber over a loser and one post.

    • Greg

      Sendkeyss,
      If you used foul language or you made inaccurate or libelous statements, then I blocked you. Also if you want to be this critical of someone use a real verifiable name. Man-up and own your words. If you can follow my rules I will un block you.
      Greg

      • Scott

        Greg opens the forum to all opinions, but clearly states he doesn’t want foul language. I think Greg Mannarino and Greg Hunter are sincere and genuine; but you are entitled to your opinion… So USAWatchdog loses another trolling subscriber; there are plenty more to take your place, Sendkeyss. Good riddance!

    • Galaxy 500

      Dude,
      It’s a free site, please go elsewhere with your venom. Paid gov’t trolls are briefly amusing but just briefly.

  3. sendkeyss

    Morgan is about the best guy you can get on here by the way. Seeya forever.

    • Galaxy 500

      thanks dude…go troll elsewhere

  4. Jerry

    Greg.
    Yet another testament of your unbelievable ability to find interesting guest, and your interview skills.

    Greg the ship has already left the harbor on the decline of the dollar. The collapse could happen at any time regardless of what David Stockman says. If it doesn’t matter how much debt we rack up, lets just remove the debt ceiling altogether and print money until the cows come home? The fact is time is running out. In fact President Obama is meeting with the Banks heads today. What do you think they are discussing behind closed doors?

    Take another look at Greg Mannarino’s charts. Its pretty clear of the time line. Can they stall it off a few more months with more market manipulation? Sure. But at some point the Chinese will have enough of our spending, and money printing, and pull out. Why else have they been buying tons of gold?

    October 9th is the Bretton Woods meeting. This is the one to keep an eye on. The world Banks of the NWO will decide our fate. Not the clowns in Washington. The shutdown is just a sideshow. Greg I just don’t see 2-5 years like David Morgan does. The bubble is just to big to last that long. Just my opinion. Thanks for having him on.

    • Greg

      Jerry,
      Thank you for your comment and support.
      Greg

    • Galaxy 500

      Jerry,
      I agree with you on timing. Way too much mass to keep aloft.

  5. Sanjay Kashkari

    Greg,

    What a contrast between David Morgan and Nomi Prins.

    When you asked Nomi if she would be into gold at this point, she was like “No …. not right now.”

    Contrast that with David Morgan’s statement “I think there is going to be a day in the future that you just can’t get it. The only monetary asset outside of counter-party risk is physical gold and silver.”

    I think it begs the question of whether old wisdom will be required to survive the onslaught that is coming. Nomi is purely an intellectual impressed with her own accomplishments, but to survive and even fare well in the aftermath of the next big dislocation will require a broad historical perspective.

    Pure and Simple … GOLD and SILVER (and any tangible for that matter) is very badly needed insurance. The next financial system lock-up may happen so fast there is no time to react.

    Anyone with historical perspective will fare better than one imbued with pure intellectualism any day.

    • Galaxy 500

      Hear, hear

  6. Oracle 911

    Greg

    Great interview, David Morgan really know what is He talking about.
    I found an article which speak for itself: http://investmentwatchblog.com/swiss-army-war-games-economic-collapse-and-refugee-invasion-21st-century-threats/

    Greg, what do you think about this article?

    Personally I think, the 1st step of collapse will be in EU.

    • Greg

      Oracle 911,
      Spot on again. Thank you for the comment and the link.
      Greg

      • Oracle 911

        Thank you Greg.

        When I talked about the 1st step collapse, I meant 1st VISIBLE step.

      • Anne Elliott

        Speaking of nations doing preparatory exercises … The US, Canada, and Mexico are doing a joint exercise in November concerning what would happen if the electric grid went down. They are calling it “Grid Ex”, and it will simulate a cyber attack on the electrical grid. In the future, Wouldn’t that be a convenient way to do a financial “change-over” from the dollar to some other watered down currency? There won’t be bank runs, because there’s no power and that means the ATM’s won’t work and stores/banks will be closed. Outgoing Homeland Security head Janet Napolitano has said at least a few times this summer that a “coming Cyber 9-11 attack is a certainty”, and when asked what that looked like, she said, like the electrical grid going down for weeks or months.

  7. Rodster

    Greg, I missed the point when you interrupted your guest and said Dr. Paul Craig Roberts never said that? Shortly afterwards he said he agreed with Dr. Roberts. I’m a little confused by that exchange.

  8. George Silver

    Good interview Greg. I’m not really a fan of David Morgan. He always talks a lot but never seems to say much.
    He is always covering himself. He doesn’t seem to have the courage of his convictions. He seems to skate around the question of price now and also the question of “what do tell people who bought Silver at $35″.

    He is another one you couldn’t really nail down to some good advice. You tried hard though.

  9. Sanjay Kashkari

    Greg,

    After thinking a little more on this, I thought I would attach an article by Hugo Salinas Price for your readers’ consideration.

    http://www.plata.com.mx/mplata/articulos/articlesFilt.asp?fiidarticulo=222

    I am sure most of us ponder what the end game will be. The catalyst may well be derivitaves or some other machination, but this article details what could be the basic implication for every man, woman and child on the street.

    Nooone knows the day, month or year, but the “big one” is a foregone conclusion. It is surprising that the party has lasted this long, but we have been living in an “Alice in Wonderland” financial world where one huge trick is trumped by another adinfinitim. Simple logic says it cant go on forever. People are DUMB, but NOT “THAT DUMB.”

  10. Johann

    The truth is we do not fully understand when an economy is totally destroyed. At the end of WWII in Germany and Austria there was a period of time when Gold and Silver had no value. All that had value was what would sustain life. I have Silver, but I also have a storage of those things that are needed to sustain life. I think you Americans have a saying, “a word to the wise”. We could see total chaos for a period of time that could extend to months or even years under certain conditions.
    Salzburg, Austria

    • Greg

      Johann,
      Good advice!!
      Greg

      • Allen Ols

        We can’t eat gold, and we will have massive food shortages world wide. Stock up

    • Galaxy 500

      Johann,
      I recall reading Argentinean Customs forms stating the amount of gold being brought in by Nazis. Gold and Silver were what Switzerland was paid in by Nazis. I can find no reference where Gold and Silver where not readily convertible to cash. Is this a life experience or can you provide links to reference? I am very interested in researching.

      • mohammad

        Johann,Greg,Allen,Galaxy

        Let me state clearly that Hitler was a notorious dictator.
        However he managed to escape the control of central banks by issuing money that is debt free instead of the debt money with interest that was issued by private banks. That move turned Germany into the power house we all knew until the end of that chapter.
        OR DID THAT CHAPTER REALLY END?
        Well it seems that there was a move during the end of WWII made by three pillars of the Nazi regime, one is finance, second is security and management, the third is science.
        that move took all the loot of the nazis through the bilderberg that had representation of the west anglo american interest and here am referring to Rothchild, Rockefeller…. etc.
        and another interest of the nazi represented by Prince Bernhard that made sure the loot of the nazis will be funneled into the western banks to clean it then to be funneled back to Germany and Europe to build it after the war.
        It seems that they (nazis) had to hold some kind of a trigger against the western interest if they do not pay back when they are supposed to, that trigger is nothing less than the BELL project.
        Argentina falls in the story when most of the scientists of the bell project including the three pillars i talked about earlier were in Argentina post war.

        Dr Farrell describes it elegantly and with documentations that cannot be refuted in this presentation in 2009:

        http://www.youtube.com/watch?v=15EuY98gCUk

        P.S.
        Do not get distracted by the UFO logo on the podium, Dr Farrell is logical with his approach and always collaborates his views with documentations.

  11. Bob

    Great interview as always, Greg was able to get David Morgan on his show was a real coup d’etat. The more information we get such as this the better we can “weather” this horrorable financial storm staring us in the face. By the way, Dave Morgan has a great web-site and you can sign up for his ‘Morgan Report’. Wealth of info there. Great job again Greg Hunter—-Who ya gonna get on your show next? Hard to beat Morgan or Jim Willie or Fabian etc. Look forward to anybody you bring on——

    • Greg

      Thank you Bob. I thought Mr. Morgan was a good guest too!
      Greg

  12. Nichole

    Great Interview. David has such a practical approach to these metals.

    Whats the true price of gold/sliver? WHATEVER IT WILL BUY YOU WHEN YOU HAVE TO SPEND IT!

    It is poor logic to value precious metals for long term holding in dollars. ITS REAL MONEY! It is recognized in every country and has value no matter where you travel in the world!

    • J C Davis

      Nichole. Great comment!

  13. mohammad

    Greg,

    Most experts are dealing with the symptoms of the disease not the disease itself.
    If a patient has a fever… the illness is not fever, the treatment is not Tylenol. Yes you still give Tylenol to reduce the fever but it does not treat the illness.
    Not many experts are getting into the root of the problem, greed, control…etc are the obvious but not many jumped in deep to give us a grasp of what the heck is going on that is affecting our lives and our future.
    Those nagging questions made me a friend of google, a very close friend that is …. :)

    Why the euro project ( 1992 Maastricht Treaty) was started two years after the reunion of Germany in 1990?
    Is that a mee coincidence?

    Why Germany the leader and the mere power house of the Eurozone is forcing austerity on the euro members, submitting their sovereignties to Germans and getting with monetary manipulation what they did not get from Europe with war?

    Why a major member of the Bilderberg prince Bernhard is a former Nazi despite the cosmetics to his C.V. that gave him a free pass to the elites?

    Is it coincidence that the bank for international settlement is a former Nazi bank?

    what influence Germany has over China, why China is supporting the Euro, dumping the Dollar besides the obvious US monetary policy? are there other reasons for that support?

    Is it possible that Germany is the major dynamo behind the financial coupe de tat against the dollar? if so what are the chances that the nazi Germany is back with a different skin?

    It is important to listen to someone who gets to the bottom of it from DOCUMENTS that any one can pull and verify:

    Dr Joseph Farrell:

    http://www.youtube.com/watch?v=ed2kzRPrgio

    It is another perspective that i find attractive to say the least.

    • Greg

      mohammad,
      Very interesting points you brought up!
      Greg

      • mohammad

        Thank you Greg,

        Let me throw a whopper here…!

        I lived all my life in Damascus Syria except for the last 23 years in US and until I heard yesterday the interview i did NEVER KNOW that number one man wanted for the NAZI TRIALS is hiding in Syria for the last 40+ years, from the time of Hafiz Assad the father of Bashaar.

        ALOIS BRUNNER

        http://www.jewishpress.com/news/nazi-fugitive-alois-brunner-may-be-alive-in-syria/2013/07/28/

        And some say the regime in Syria is FRIENDLY….!
        Nazi trained secret police are not friendly my friends.
        I known this fact from one of the interviews of Dr Farrell.

        I really hope Greg if you bring Catherine Austin, I guess she is on the same page as Dr. Farrell in many aspects.

        The guy is scientific in his approach and he never puts things out without references from documents that collaborate his view.
        Am so fascinated by him, he blew my mind!

    • Liquid Motion

      Good points Mohammad,
      I too have suspicions about why the rhetoric continues with much emphasis on “symptoms” and limited discourse on the root cause.
      All valid nonetheless.
      Critically, it must be shown that all of the symptoms you mentioned in addition to that of Debt, Deficits, Manipulation, Suppression, Bail Outs/Ins, False markets, Lack of price discovery or ability, False reporting, Unlawful/non existent & non-enforceable regulations, Inadequate/Unaccountable Government are all the result of the Fiat Monetary System. That’s it. Boring I know. BUT everything in this world is prisoner to the system that was designed to trap us all. There is NO escape whatsoever. Buying precious metals really only provides one with limited degrees of safety/protection. For this event does not have precedent. It is world wide in its scope and depth. It cannot be compared to historical events (it can in terms of magnitude, but not in terms of outcomes). Humankind is at risk. K. Hudes touched on this point.
      It is the ones who seek to control everything that we should all be very afraid of. Perhaps as you say it is the Nazi’s of old who wish to reclaim what was lost. There is no doubt in my mind that the EURO project is all about creating a “STATE” platform from which to rule economically, socially , politically and financially. To date they only have a unified currency. The day of reckoning for them is fast approaching.
      I would contend that the facade of economic recovery is more appropriately assessed as an Economic Depression in more than 50% of the world’s economies. That’s the reality. The other reality is that the central planners are not willing to do what is necessary to remedy the situation, either through Fear or through lack of understanding of what is required to be done. Ultimately we all end up paying the price for the so called Action/Inaction. That price will be Inflation and loss of lives.
      We are slaves to the belligerent fascists who control our destiny unless the monetary system has dramatic change. This entails the de-throning of the USD as the world’s preeminent “KING”.

      • mohammad

        Liquid Motion,

        It is very very very simple.
        It is very very very difficult.

        Simple:
        We will turn around and we will prosper in 4-5 years, honest to god we will …. just if we have someone in the driving seat that has the balls to take that power from the private banks and MAKE THE US SOVEREIGN STATE ISSUE ITS OWN MONEY DEBT FREE.

        Difficult:
        We do not have one, only 4 US president did and we all know what happened to them.

        The moral of the story is:

        As long as we care about sports, American Idols, soap operas, talk shows… etc, more than our freedom we will NEVER be free.
        Worse,
        Our kids and grand kids will never be free!!!!!

        • Liquid Motion

          M,
          Without sounding crass or insincere…BINGO !!!

          RID THE SYSTEM OF THE PRIVATE BANKS AND THEIR MONOPOLY MONEY GAME.

          It can be done.
          State run BANKS. Created by the people …for the people.
          Wealth and prosperity would return very quickly as would integrity and justice. Moreover it permits an economy to function without the need for ursury whilst avoiding avarice.

          The problem is convincing the public, while they still have choices and some semblance of wealth remaining, to move away from the current banking/monetary system with total reliance on USD fiat/debt. Convincing will come easy when the current system implodes and the greatest transfer of wealth in history occurs.

          • mohammad

            Am afraid Liquid Motion that when system implodes it will happen by design after the parties involved position themselves heavily and correctly then it will be digital money with more control, monsanto seeds, EMR, National ID card…..etc
            It is now the time to act and not to wait until the system implodes, actually we should what ever we can to prevent such implosion, and in a very civilized way.
            An example i liked form Catherine Austin (you have to like this lady, am fascinated by her intelligence) that really struck home:
            She was describing 3 ladies that are neighbors to her.
            Two of them had CD’s with a New York Bank that gives them 4% interest.
            The third lady has a business with a loan from the same bank with an interest of a whopper 24% interest.
            So here we have three neighbors in the same town giving an arbitrage to the bankster of New York of 20% spread ….. That is a whopper 2000 basis point arbitrage.
            If they have a way of securing the loan through a third party LOCAL bank and a local lawyer then the two ladies get more on their CD’s, the LOCAL BANK/lawyer gets a share for the service and the lady with the loan will get it at a lower rate, and New York bank will get the flip.
            It is feasible but we have to act and do it.

  14. Troy

    GOOD INTERVIEW!

  15. thomas yonker

    David Morgan seems to be one of the for pay advisors that has a grasp of our situation. He seems to have changed over time from hyper inflation which puts him in line with Martin Armstrong. Armstrong has a good point about hyperinflation not occurring in our system. I too think this is the probable course. Armstrong has been very good in timing markets. He has a time line which is not liked by precious metals people, but has good arguments anyway. He is a bull in the long run. Perhaps you could use your skills to get him to interview? I also fall in his camp about there not being any one entity or force in the markets that totally understands them. That seems painfully obvious to me. Kudos to you for leaving the mainstream BS machine and trying to help people understand.

    • Galaxy 500

      Armstrong has hit some major home runs but he also bankrupted himself.

  16. andrew

    Thank you Greg for another excellent true piece of journalism.

  17. Lightning Larry

    Greg – this guy, Mr. Morgan, brought up one very, very interesting point. He says “I do not see a hyperinflation. You don’t have to have hyperinflation to have a currency crisis. A currency crisis is where a currency is shunned by the people at large.” Wow…food for thought. I can see where there would be a major dollar crisis without hyperinflation – possibly just a major devaluation due to a massive shunning (dumping) of dollars and treasury bonds. All of a sudden, $10,000 saved could be worth $1,000 or less. Interesting insight from Mr. Morgan.

    • Galaxy 500

      I do not see.a.difference between inflation and devaluation. Is there really a difference between a gallon of gas costing $30 (current) or $3 New Dollars that are a ten to one reverse split? Greg, can you clarify the difference?

      • Liquid Motion

        Galaxy
        Inflation is covert ( a thief that steals over time).
        Devaluation is overt….in the context of what Morgan was referring.

        LL,
        A currency crisis leading to “dumping” of USD/UST would in itself approximate Hyperinflation (dumping considered to be an act to rid oneself of exposure/risk as quickly as possible). It is the speed with which the so called “dumping” occurs that is the key element to defining the difference between bad inflation and Hyper Inflation. This is in the vernacular of economics referred to as velocity. This is usually associated with a loss of confidence in the value of paper currency and also typically occurs when there are large increases in the money supply that dont match GDP and so therefore creates imbalances in supply and demand.

  18. Jonathan

    Good interview with David Morgan: however, I’d really like to see someone call him on his call he made about “silver not ever dropping below $30″ a while back. I did see him address that issue in a Sprott interview (I can’t remember the exact verbiage but it was something like “Clearly,I missed that”). Of course, who could have seen the heinous dip in metals prices — but perhaps that’s the point. I have a friend of mine that bought gold and silver when they were around $1800/$40 and now he’s vowing to never touch the precious metals again, my tut-tutting him about following the herd falling on deaf ears.

    Keep in mind that I’m a Morgan Report subscriber (I think it’s one of the best values in the newsletter business) but I’ve still learned to be slightly leery of anyone that has an agenda. I never thought I’d see < $20 silver again and after its precipitous drop I'm now wondering if it could fall even further. I'd really like to see it consolidate around the $26 mark for at least a year or so.

  19. Galaxy 500

    The Obamachrist is telling world that this gov’t shut down is different than previous and America is likely default. Who has done more harm to our country and way of life in this century? Easy, Obama.

  20. Robert seitz

    Just re comments today that the COMEX is a world market? To what extent ? For example in American baseball they call the final series The World Series But it is not it is an American competition. To what extent is the COMEX a world market ?

  21. Jerry

    Lightning Larry.
    My grandparents who lived through the depression told me there was a whip saw effect right after the stock market crashed in 1929. It was not uncommon for a loaf of bread to be sold for $10. A few short years later you buy stocks for pennies on the dollar. Fortunes were lost and fortunes were made. Sounds like hyperinflation to me.

    Greg I heard a rumor that 5 weeks ago Timothy Giethner made #3 separate money transfers of 5 Trillion each from the Federal Reserve to the Bank of England, and then to the Bank of Scotland. Supposedly it showed up in a French newspaper. Have you heard anything about this?

  22. jaja

    Greg,
    Love you. Greg Hunter. Thank you so much for fulfilling.

    • Greg

      Thank you for the love and support jaja.
      Greg

  23. Eric

    Greg,

    The Comex is left with about 23 tons of gold in their registered inventory (as per Harvey Organ’s web site). From this you have to subtract what will be delivered in the month of October. When October is over, they should be left with about 10 tons of gold. This quantity of gold is so ridiculously small that it screams at something evident: The big players in the gold market (I really mean all of them) have all agreed to keep the price of gold as low as they can for as long as they can. If such was not the case then any big player, being a central bank or a hedge fund, could force the Comex into a default this very month of October. All they need to do is buy 10 tons of gold and the Comex is forced to settle in cash. By comparison, around 10 tons of physical gold is sold and delivered every day out of the Shanghai Gold Exchange. So the question is why doesn’t this happen?

    Here is my theory:

    1. The Chinese (and others like the BRICS, etc) want to accumulate as much gold as they can at the lowest possible price. Therefore, they also have an interest in manipulating the price of gold to the downside. On this topic there is an interesting interview on KWN.

    http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/9/30_Poker_End_Game_-_JP_Morgan%2C_Fed%2C_US_Treasury%2C_China_%26_Gold.html

    2. This coupled with the recent news that Sprott Asset Management has made a deal with the biggest Chinese mining company to explore and identify junior mining companies for acquisitions tells me that the Chinese have a vested interest in maintaining both the price of gold and the mining shares heavily depressed for as long as it can be done.

    The Chinese know that time is running short and the current monetary system will not last for much longer. In addition to that, the West has pretty much leased and sold in the physical market all the gold they could lease and sell. I doubt that there is much physical gold left to be offered at the LBMA. Foreign central banks will buy everything they can at current price level without pushing the price up.

    Therefore what is the best alternative for them to continue to accumulate physical gold at the lowest possible price? They buy mining companies with proven underground reserves at heavily discounted prices. The HUI index is ridiculously low and even Eric Sprott was bragging not long ago that he bought at penny to the dollar the gold reserves of a junior mining company. By far, the cheapest gold you can find today is the proven reserves of some of the mining companies. Especially if these companies are in financial trouble… Which I bet that at current prices several of them are.

    Once the Chinese (or whoever else) own a mining company, it won’t matter for them if the price of gold goes up. The price they will pay for their physical gold is their total extraction and refining cost for as long as they can mine the place…

    So my theory is that the price of gold will be maintained as low as it is for as long as:

    A). Foreign central banks (like the BRICS) can scoop physical out of the LBMA

    B) There opportunities left for acquiring good mining companies with proven underground reserves.

    Once this is done, then I believe that the price of gold will be allowed to move to the upside.

    • Greg

      Good stuff Eric!! Are you an analyst? Thank you for posting.
      Greg

      • Eric

        Just a little guy trying to understand what’s going on…

        • Greg

          Eric,
          Bravo on the analysis. Thank you for posting. Please post anytime. This kind of work helps us all understand what’s going on!!!
          Greg

    • Liquid Motion

      Nice work Eric,
      I read somewhere that the Chinese (officially) want to acquire another 5000t of Gold. Seems a significant amount in the context of what is supposedly only a 2500t pa mined supply of which China/Russia produces close to 50%. At current import numbers (~1000t pa) they would achieve their desired purchases within the next few years.
      Putting the whole Gold acquisition into perspective…China’s new appetite for Gold…in dollar terms…equates to ….6% of their reserves. That’s the math of the whole gold play. Compare that percentage of their Reserves to that which they hold in USD/UST and we get to see the REAL issue here for the Chinese. No wonder they are hell bent on buying up global assets. Western governments are blind and stupid. This only goes in one direction. For all of us we end up broke with no assets, no jobs and no income AND we will be answering to the elites in China when all is said and done.
      Fine work gentlemen…fine work indeed !!!!

      • Eric

        Liquid Motion. Interesting comment. Remember, Debt is the money of the slave. And who is the biggest debtor nation?

        Those idiots at the top of the pyramid are selling their physical gold reserves and all sorts of assets and equities at highly discounted prices! Like Jim Willie says, the US treasuries are coming back to shore and they will choke the Western Banks.

        I think that they have been on top of the World for too long and their arrogance and corruption has blinded them. There is no way they can save the US dollar. And I very much doubt that they will be able to impose their IMF’s SDR when the time comes for the change. The BRICS are already preparing the ground for the alternative monetary system.

        As for the 5K tons of gold, I don’t think that the Chinese have the luxury of another 5 years to accumulate such a large quantity. That’s why I speculate that they will go after the gold that’s underground. And as you said, they’re going after just about everything as long as they can use their US dollars to buy it; gold, copper, iron, feedstock, agricultural land, etc… It’s a race to unload paper US dollar against hard assets.

    • mohammad

      Eric,
      Let me put another perspective here since you mentioned the Chinese……. fascinating subject to say the least.

      Who caused or triggered the melt down of 2008?

      I would like to introduce you to a formula that will go in history like Einstein’s formula E=mc^2 went.

      I will not go into math but the guy is Dr David X li and the formula is: the (Gaussian Copula probability theory), that formula calculated risks in the bundles packages of mortgages and credit default swaps…. etc!
      As if he gave whoever busted the market the tool to bust it.
      Now…. Dr Li worked for Canadian Imperial bank for commerce, a bank connected to Rothchild, a major stock holder of that bank is an elite tycoons in Honk Kong. Dr li is back now to china working for the government assessing risks so go figure.

      This information is courtesy of Dr. Farrell

      http://www.thebyteshow.com/Audio/JosephPFarrell/JosephPFarrell_BabylonsBanksters1_30July2010_TBS.mp3

      This formula was used to bust the mortgage OTC in a way that could be described as FINANCIAL WARFARE waged by china.

      Dr Li goes in his family to chinese emperors hierarchy, also he has connections with a very very wealthy families in Hong Kong that could be considered the underground chinese force.

      You may be seeing now a gold warfare which details of can surface later on when the positions are taken.

      • Jon

        First of all, the Chinese are not masters of the universe. Their leaders are a mafia who made a deal w/the West. I fear the Russians much more. They, the Russians, did their collectivism, Soviet time- which btw they managed to defeat the greatest mechanized army to date, the Nazis, and stood up to the post Bretton Woods America for 50+ years when their population of intellectuals was decimated by Stalin-, had their collapse, and have picked themselves up and reorganized. We Westerners are still in our Soviet days. The Chinese are, at best, a periphery power, i.e. they matter in Asia, a lot, in Europe, not so much. If the Russians didn’t matter, Syria would have been steamrolled decades ago as the Europeans don’t like being dependent on Russian gas to survive the winter heating season.

        That being said, the tell is the German gold. Seven, or however many years to repatriate the ~700 tons of gold, which by the way would fit on 3 747′s if available for delivery? The problem with the David Morgan’s and Jim Puplava’s and Marc Faber’s of the world is they can’t come out and say you should be 100% invested in PM’s as that is contrary to what is allowed by TPTB. 10 to 20% is OK however as the majority of one’s net worth is still within the Matrix. Jim Willie sums it up best when he said in a recent TFMetals.com interview about a conversation w/his sister: Sister: “Jim, I’m worried about my retirement. What should I do”? Jim: “Liquidate your retirement investments, take the tax hit and buy physical gold and silver.” Sister: “I can’t do that.” Jim: “Why are we having this conversation”?

  24. Richard

    Finally, a breath of fresh air. Yours is the 1st interview I’ve seen on the internet that tells the truth about the consequences of raising the debt ceiling. Everyone else (including former Treasury Secretary Hank Paulson, just on CNBC saying “we must raise the debt ceiling”) is either naive or knowingly irresponsible. Thank you David and Greg, for bringing us this interview.

    Its difficult to understand how most financial analysts and Wall Street bankers (and 90% of the public) believe raising the debt ceiling is the right thing to do because “we have to pay our bills”. Incredible!! That’s nothing more than “borrowing from Peter to pay Paul”. There are really only two options for the US to meet its obligations: you either cut expenses or raise taxes (or a combination of the two) to pay for the services we all feel are necessary. Which direction to take is a discussion for another day.

    Not raising the debt ceiling keeps the control with us as we chip away at putting our house back in order. Putting our national expenses on a credit card (after voting to raise the limit on the card) allows others (the rest of the world) to decide if/when to cut us off completely. When they do, it will be painful.

    Not sure when this happens, but I’m certain one day the rest of the world will wake up and realize “the Emperor (the US) has no clothes (money). Unfortunately, that’s the day the House of Cards we call the US dollar, collapses.

    • Liquid Motion

      What about the so called banking elites and what they are saying now…Lagarde and Draghi….what an absolute farce. It really does emphasize that the US is the key linchpin in the world. As I’ve been saying…the monetary system with the USD as the core element is the crux of the problem. The US MUST keep printing and paying its debts with more debt otherwise the whole global economy caves in. Its not US centric…………. ITS GLOBAL!!! The sooner everyone gets that point the sooner we understand the diabolical mess we are in.

  25. Roger

    In the intro to the interview it quoted David Morgan as stating the real price of gold was at $5000 – 7000 and silver at $100 an ounce.
    Unless I missed it, I did not hear David say that the real price of silver was $100 an ounce. I heard him say that it was at the historical ratio of 16-1. With gold at $5000 – 7000 that would put the real price of silver at about $375 an ounce.
    To those who are upset for buying in at $35 an ounce I would say this.
    Do not get discourage and sell out! Your patience will be rewarded.
    focus on the long term gain not the short term pain.

    • Liquid Motion

      Roger,
      Outstanding math.
      What pray tell does $5000 Au/ $375 Ag imply ?
      Think about that and follow it through. Understand the real reason why people should buy PM’s rather than qualifying it from an investors perspective.
      If it ever gets to those valuations…it means something is drastically wrong. If that be the case, would you convert back to paper ?

  26. Galaxy 500

    Clapped (NSA) says we are less safe because of shut down. But he admitted he lied about how effective current programs are in stopping and detecting terror plots among other lies. It’s hard to believe anything he says when he constantly lies. Why would anyone take him seriously when he has been exposed as Obama’s stooge.

  27. Stan

    Looks like the democrats and main stream media are going to use the government shut down to blame the republicans for destroying the economy. They know its all over but the blame…

  28. Jerry

    Stan.
    You are more right than you know.
    A. There is going to be a collapse
    B. Most people won’t know about it until it happens.
    C. When it does happen Obama and his minions will blame the Tea Party

    Moral of the story. Never let a crisis go to waste. Cloward/Pevin

  29. Glen

    I have been listening and following David Morgan for 2 years. David Morgan has made a few good calls and also made some whopper mistake type calls also. No biggy cause most analysts did not see silver going down this low from its highs in May of 2011. David was shouting from the roof tops that we would see 60 dollar silver in early 2012. He also said that silver would be a great investment at 30 dollars. He admits this in Gregs interview. These bad calls took a huge toll on Davids client base. Times have been real tough for silver holders these past 2 and a half years. Now, it is hard to get David pinned down on where he sees silver going in the near term. He learned his lesson the hard way as he now readily admits that predicting where the price of silver is going is a fools game. Anyway, no one knows the fundamentals better than David Morgan. He is worth listening to based on that alone I guess.

  30. Hugh

    Mr. Morgan makes two points that are not true.

    Number 1: “I think there is going to be a day in the future that you just can’t get it.”

    If you can’t buy precious metals, that means you can’t sell them. If you can’t sell them, it would be foolish to own them.

    The value of precious metals is that they are liquid assets. One can always get them because one can always sell or trade them – that is, they will always have a price. Trade or exchange is always a two way street.

    A true statement would be: “There may be a day in the future where one can’t exchange with dollars.”

    Number 2: “You don’t have to have hyperinflation to have a currency crisis.” Wrong. Hyperinflation is what causes a currency crisis. Hyperinflation is paper money becoming less valuable daily. Without this value loss, there is no crisis.

    If the public or other countries reject the Dollar, they will do so because of the inflation. There would be no other reason to reject it.

  31. Jacques

    If you will remember I mention that we should be concern for the gold that we take delivery because we can’t be assured that there is no Tungsten in it. Apparently the German press has put out that this is the very fact. Along with their article they mention that China has discovered that they have accumulated nearly 6,000 four hundred oz. tungsten-plated bar among those they have recently received from bonded warehouses.
    Here is a Youtube video creator who pulls this info from Germany with his outstanding comments. He will make his points at first then read the article for you.
    http://www.youtube.com/watch?v=m4scUyqdWlQ

    May I add one other point that he doesn’t make and that this systemic problem will turn the value of gold on its head and the only valuable gold is the one you can put a hammer to or bite into it. Of course this is nothing new is it, because that’s why many of the very old gold coins have bite marks into them.

    With great regret that I might be right, once a thief always a thief and our politician are nothing but thieves.

    • Greg

      Jacques,

      Great stuff! Thanks very much for posting it!

      Greg

  32. Terry Clemmons

    What are they really slowing down our home for. I would ask these men running our home why are they killing us. I say we should start a new party called the Peoples party. The most basic rule is that if you are Gov. thief you can not run for office in this party, you must come to your home area where you were voted in and on a weekly basis come home and let the ones that put you where you are know all the time what you are voting for and why, Any money that has been given you for any reason other than a pay check form your area that you were voted in to has to be turned over to the area you are working for, That you are not getting a free lunch like the other parties are giving there man in DC., That the Health care that the area you are coming from is the same health care that you receive, That the area you are working for your pay be less that what your voters are making. If you are working for some one you never get more than him. Pay that is. All the Pigs in DC., have forgotten who they are working for. Now come Thanks Giving how many of those pigs will be at work.

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