Eric King: “John you had
mentioned to me before we went on the air that one of the reasons Goldman
(Sachs) may have made that call (for the end of the gold bull market) is because
they are trying to buy gold for China on the cheap. I know you’ve seen the
chart from Egon von Greyerz that shows Chinese gold production, plus net
imports. It’s a shocking chart when you really look at the growth
there.”
Hathaway: “Absolutely.
Look, it’s not just China. Central bank buying, I’ve seen it in a couple of
places and we track it, has really picked up. So what does that tell you? It
tells you that people who are long our paper, they are starting to get it.
They sort of understand that one way or another they
are going to get screwed because there is no way out for the US other than to
keep rates in negative territory right across the yield curve. So why would you
not diversify? And what are you going to diversify into? Are you going to go
into the euro? I mean good grief, give me a break.
Gold is the obvious place to try to get your hands on
some diversification away from dollars if you are a central bank. I think
that’s also true of private wealth. Frankly, what I am hearing in the dialogue
I have with our clients and perspective clients is, ‘Yes, we really need to take
a long-term view of it.’
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