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-- the call.
Gold is down after the metal plunged -- gold to its lowest level in almost three years but just how Long Will the down last let's bring in Peter -- CEO of Europe is -- the -- reaction Peter.
As that lets you know right now I mean gold is almost at this 12100 dollar mark which we have Phil Flynn from the CME.
Saying the nominal cost of production and that would be a real problem -- this happen.
Right now we've seen a pick up in the drop in gold can explain why we're seeing this sell off.
I think you have a lot of speculators that are selling gold there's no doubt about it how much more downward pressure they can exert in the days and weeks ahead its part the cell.
I know but what I do know was -- the price can't stay down here.
If if one reason you just mentioned the cost of production.
Most of the world's minds can't even produce goal for 12100 -- announce so obviously a commodity can't -- prolong below the cost of production because you're not gonna have any supply.
And that's gonna take care price because the supply goes away the price has to go up.
So one of the things that people have said the reason you -- -- have gold is the monetary policy novel in the United States but also in Japan.
He's going to bring about the kind of inflation where you're going to need something like gold to protect yourself.
But the critics that say that inflation hasn't even appeared in the United States nor will it you would disagree but it looks like you're wrong.
Well no I.
I think it's the government does wrong their hiding behind these phony measures that purport to tell us what the inflation is like to CPI -- their personal consumption expenditure index.
But the definition of inflation is an expansion in the money supply that's literally what it means the money supply and supply of credit are being inflated.
The result is that prices rise but the Fed is not -- -- the government the extent to which consumer prices are in fact rising.
And what are the reasons they're not rising even faster is because we've been able to export that inflation to our trading partners.
That's were the reasons that the cost of mining has gone up so much remember these gold companies that can't -- -- today at 12100 dollars.
Ten years ago when gold was 300 they were able minded a profit.
However the cost of mining gold -- -- so much if there's no inflation figure has -- inflation the price of gold does that he reflect.
-- you are far more experience and wiser than me in this area but I gotta say that tell yet prices in the United States that the way that I am regular consumers would talk about inflation.
Our prices haven't come up and I realize the PCE from the Fed one point 1% is low for them.
At the end of the day in English what that means to me is the kind of inflation that worries me and would propel me to buy gold does not exist here in our country so make.
The case is to wire while I don't I disagree it out.
I talked to people all the time call my radio show all -- but I do you know it also.
I'll tell me how much things are going up op tried like the rising do what he's -- what we were growing up like Wisconsin if prices what's -- pick away at various labor and consumer electronics.
Okay -- outlook personal look at the price of -- today at 97 dollars a barrel and rising but prices are rising.
-- and they're they're they're gonna rise a lot faster and also part of that the what -- what's driving gold down.
Is the idea that the Q is gonna stop it's not gonna stop the Fed is about to ramp -- up.
Because the phony recovery that they created is about -- evaporate the US economy is headed back into recession Ben Bernanke as he always is is wrong.
And that that will be housing bubble that he tried to briefly is it is deflating -- like they're gonna roll her about being -- Me and I'm going to be looking at revenue numbers in the second quarter earnings reports that are about to kick off but I gotta tell you.
When you talk about inflation and -- is concerned about dead and the easy money policy but when you talk about money supply.
They haven't actually put it out there -- sitting on a computer it's not the same -- reading it and and we haven't seen the inflation that the inflation hawks always worry about it's not here open.
The Fed is buying 85 billion a month of treasuries and mortgages -- do you think that money is coming -- it is being -- into existence.
Out of thin air by the Federal Reserve and at the fact of the matter is they're gonna -- even more and eventually are trading partners are gonna stop.
Absorbing our inflation the dollar's gonna tank.
They're not gonna warehouse our treasuries and our dollars and all this inflation that we've been exporting is getting hit us like a -- and totally -- that philosophy guided me so whenever I bet all the -- -- -- dollars an ounce and now it's down to 12110.
-- -- they got burned on that philosophy which is gone wrong since 2008.
Well what what markets are volatile remember in 2008.
Gold dot drop like 35% in 2008.
People that I -- you were wrong the Bible that it tripled in the next three years to meet stings are volatile look what happened to the stock market in 2008 it was -- -- -- he did tell people not to buy stocks and stock market came back in fact if you go back to to the 1970 bull marketing gold.
Bull dropped by 50% in in 1976.
From 200 to 100 and then it went up 850%.
In the next three years so markets -- volatile but it does it mean to people who all -- wrong just because it's going down today.
I think people were selling gold they're the ones that are wrong they're wrong for a decade and they're still wrong and on that note Peter I appreciate your being here wanna point out again you are much more experience in this and I am just saying with the critics are saying about pulled all the -- Peter -- --
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