Financial System-At Some Point it Blows-Eric Sprott
By Greg Hunter’s USAWatchdog.com
Eric Sprott manages $10 billion, and he’s worried about the global financial system. He says, “There is this huge chaos going on in the financial business which I think we all sense. They are using desperate measures here to hold it together. . . . at some point it blows. There’s no doubt about it.” Sprott says the price of gold and silver are being suppressed because, “It’s the canary in the coal mine.” Rising prices in precious metals, according to Sprott, would tell people, “Central bank policies are ridiculous and irresponsible, and people would realize that with the price of gold and silver going up.” When it comes to silver, Sprott says, “People keep buying at a rate to 50 to 1 to gold.” As far as gold is concerned, Sprott contends, “Physical demand for gold is out of line with supply. How can all these new people come into this market when there has been no increase in supply . . . for the last 12 years?” Sprott’s analysis shows central banks are selling to make up for the shortfall and opines, “I would hate to think what happens when we all find out there is no gold in the Treasury.” Join Greg Hunter as he goes One-on-One with Eric Sprott of Sprott Asset Management.
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About the Author
Greg Hunter
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.
The “shadow” fiscal policy of the FED & the U.S. Government is fiat printing. A criminal can claim he is a good citizen but the proof is in his actions not his words.
“The”SHADOW” fiscal policy”.- I like it.
I agree that silver has the potential to way out perform gold because the small money will go into silver because of the price. Recently there was 90 million ounces of “paper” silver injected into the market late last week.
I don’t see a quick implosion of the US economy but a slow painful contraction that will blind people to the obvious. I mean look at inflation. I see that most people don’t even understand how inflation deflates their dollars …..
I will go even further to point out that the planned obsolescence economic model will end badly as resources are used to produce junk versus a product that will last 10 times longer. I had to laugh when I watched, “The Light Bulb Conspiracy” because I could see the parallels of todays disposable society..
https://www.youtube.com/watch?v=4WPrTk90VZM
Thank You Eric and Greg for great information
Thank you Mitch for the comment and the link.
Greg
Greg: while many will decry Eric’s assertions as just “talking his book”, his organization has provided some remarkable research that substantiate his views, especially on the disconnect regarding supply and demand and the GSR. There is no question in my mind that he will be proven correct in the mid term (3-5 years minimum), but the race to debase might lead to an epiphany much sooner.
I agree AndyB. I think Sprott will be correct. The price of AG using common sense will go much higher in dollar terms.
Greg
Thank you Greg, You are one of my mentors that brought me back to the real world and woke me from the dream. 14 years of schooling, 3 years in college and i have learned more on your site and others in one year than all 17 year of my “education”. I always new the game was rigged but now at 23 i can look forward and have hope to help rebuild after the storm. I just wanted to thank you for helping save my life and the life of others, every video makes the world a little brighter.
DIVIDE WE STAND TOGETHER WE FALL
WE MUST BECOME ONE, A MIGHTY WALL
TOGETHER WE STAND PEACE FOR ALL
Wow Sean, you made my day!! Thank you for the comment and support.
Greg
See Greg, You’re saving our youth from years of delusion and heartache.
great interview, greg. i think mr. sprott is 100% on target. it’s impossible to predict how long the current system will hold together but we should all expect the financial markets to implode before this decade is out and possibly much sooner. greg, i think your scenerio of the comex freezing up is likely. i was astounded that they didn’t make everyone whole immediately after mf global blew up. anybody who has there money tied up with them is asking for trouble.
Thank you Josh. The ride will get increasingly rougher from here on in.
Greg
Hey Greg,
It’s getting hard to supply superlatives to all your interviews – but this is one of the best. I think we all understand that some preparation goes on with your subject, and that issues and questions are pre-covered in order to give time for reflexion and preparation of the interview: but WOW!
Obviously, PM’s are being oversold in the paper empire; AND manipulation on a grand scale is continuing – but the ONE BIG QUESTION remains: how much physical is there? Maybe this is WHY Germany is having to take five years to get just SOME of it’s gold back home. Could it be that the US is having a hard time coughing it up???
Thank you Charles H. Sprott is connected and smart.
Greg
Greg: Really bad sound from eric,s end.
JC,
I know that was a Skype or connection problem. Sorry.
Greg
After all that is said, Gold is hanging tuff above 1550, and Silver above 26.
30$ silver in view of the bull, is still, a pretty good price, lets be happy.
But, in the end, the FRN collapse, as it must, and will, will propel the PMs of course.
Gold is capped because of silver chains. Gold can not explode to 4500/oz, until silver breaks out big above the 1980 highs, and 2011 highs of 50/oz.
Silver is slowly carving out, one of the GREATEST cup-handle formations OF ALL TIME.
The handle just now, is forming a consolidated BOWL formation, and is on the up tic, struggling to get back to 50.
So, one question posed, was: What is the relative typical time duration of a handle as compared to the cup? And there will be dancing about, as 50 approaches, as the bear dig in, FOR THE LAST DITCH DEFENSE, before capitulations of the bears.
Sinclair seems to indicate that the monied interests will soon flip, and go ALL IN, to the PM long side. He may have a point, just on TA alone. For if that 50/oz Ag cap gets busted, all hell will break loose in the PM prices. Pt and Pd will be left in the no-auto-recovery dust bin.
The Ag handle formation, which I have been keying on, as THE INDICATOR, to stop accumulating, when the bears turn-coat, and ride the storm to much much higher prices, and $140 is only a first rest bit toward $450 in the next few years.
The handle has clearly turned upwards, and 30$ silver right now, is JUST FINE, but except a choppy ascent toward 50, with a few trading opportunities along that way, but come break out, sit on the magic carpet ride, for a ride of life time.
http://www.youtube.com/watch?v=UtkP5gTX6Hc
Hi Greg, For the last day or so, you have been a “Forbidden” website here in Australia.-ooooohhh. = Just sent a donation by Paypal to help you recoup a bit. //// Eric seemed as “up in the air” as the rest of us these days on gold/silver.- Strange days. The powers that be will use every trick in the book to suppress the canary in the coal mine. It will be a rocky ride and not for the faint-hearted. /// Keep up the good work. JK
Thank you Justin King for your support and generosity. This was an expensive attack and I can use the money to offset the cost of running the site and fixing the damage from the attack. Thank you again!!!
Greg
This is the new America. Soon things will get really weird. Time to prepare if you haven’t already
I’m overseas and cannot get the audio/video for any of your interviews. It happens with a lot of sites, and I cannot get anything from YouTube at all! Most annoying, but I was wondering if you could provide a link to download the file? A transcript would be great also, but I understand that’s a lot of work to transcribe. 🙂
Your site is great and has a lot of really interesting interviews that I’d love to hear.
Sorry to read that your site was hacked. It is an attack on free speech and liberty. These attacks are a clear indication that the Central Planners see the end is near and are getting desperate.
Robert,
Yes something is going down because so many sites like mine were attacked in the same time frame. You should be ready for anything. Nothing they do surprises me anymore.
Greg
The economy needs to be stabilized. This crisis management has to stop. WHY forgive Egypt’s 1 billion debt after Hillary already promised them 2 billion for additional assistance. This is not Republicans doing this. This is clearly ignorance/stupidity on the White House. Hell bent on destruction of America. This is money going to the muslim brotherhood. It worked out so well with Muburack, he exited the country with 80 billion of American taxpayer money. Americans should be screaming. News does even cover it. Is this a non-event?
Greg,
Sad to hear that your website was down due to attack from unknown sources. It is frightening to think how prevalent this has become and what it portends for freedom of speech. Too obvious to exclude some very powerful bodies wanting suppression of the information that is provided on yours and others’ websites. It has become a reality for the minority with their eyes/mind open to witness what is transpiring. The masses still reside in slumber-land and will waken the very day they realise its too late.
I have a lot of respect for Sprott.
He, notwithstanding the positioning he has in the precious metals markets, has a very acute mind. He spots the critical data points which pass by all and sundry, that conveniently and effectively, support his arguments for gold /silver price suppression. Keeping in mind his business is one that works off leverage too. The more capital he has to yield, the more income he generates. He does of course have to demonstrate with high conviction, his position with regard PM’s and that filters into the investment community. He has without doubt become a valiant supporter of precious metals and with his knowledge and capital base will seek to improve/sustain the wealth of a fortunate few. I will continue to follow his path.
I support his points on “facts not adding up” – export of gold, buying ratio of silver:gold, CB’s not being audited, use of quasi acctg standards, charade being played out by central planners in keeping the financial system together (without regard to the economy), saving of numerous institutions and TBTF Corporations and so on. These are all meaningful and valid data points. They highlight deficiencies and lack of integrity of the financial/economic system we all accept. They however don’t offer a solution. He cannot put a time frame on the end game…nor for that matter can anyone else.
What is intriguing for me is the ability of these CB’s / Planners to continue to play the game of Money Printing and Price Suppression. Sprott hits the nail perfectly on the head….”Things don’t add up”…
Are they supposed to ? is my question…!!
Lets look at Comex…which you briefly touched on. When do we have a “show me the money” moment you rightfully ask. When indeed. COMEX is but a casino…which now controls the “paper” price of gold. You cannot get a physical price that isn’t distorted with paper gold manipulation. Traders on Comex are betting on Gold…to MAKE MONEY. Markets were supposed to be efficient and resolve all problems if left to there own devices (according to the monetarists). Governments were not meant to interfere. Comex, by its own existence is destroying markets not assisting them to become more efficient.
Now lets look at the CB’s and their pool of gold.
Banks have always operated on the premise of fractional reserve- banking. It is my contention that CB’s are using their hoards of Gold under a fractional reserve banking system. Gold is effectively loaned out on multiples of the original quantity held. What is physically retained (to be used for redemption purposes wherever required) is but a fraction of what is theoretically held and classified as an asset. In this way the FED for example can leverage its deposits of gold for as long as necessary (depending on the fractional banking ratio it is adopting). Lets say for arguments sake that the FED works on a ratio of 50:1. This implies that it has in its armoury an effective potential “GOLD” loan book of in excess of 415,000 TONNES (50 x 8300). Quite impressive in dollar terms too…~$21.5TLN.!!!!
Sprott is again impeccable in his observation that the FED is not audited. Neither for that matter is any CB. AND… that there is an apparent shortage of supply of some 2300 T of physical gold per annum = gold being depleted from the FED Reserve. They can keep playing this game with whoever wants to participate, be it Bullion Banks or Managed Money….there is plenty to go around. Under the above premise we have decades upon decades of leveraged Gold to be depleted. If one participant who is TBTF and loses a bet on the COMEX, then the FED fixes that problem. When it doesn’t qualify, then losses will be made but the party doesn’t end…at least not until the COMEX changes its rules.
So in a nutshell, there are many relevant observations which drive normal thought processes through to a logical conclusion (Sprott’s interview is a classic example). But what’s important is to keep an open mind in terms of the “tricks” they play. We all know some of them already….however, what is not known …will cause the most harm. These are more than dollar value/wealth arguments. It goes to the psychological level….we lose our sanity in trying to substantiate our beliefs. This is after all wealth is lost in the pursuit of freedom and protection.
Thank you LM and David.
Greg
They don’t call him Admiral Sprott for nothing. He’s one of the greats.