Current Debt Trajectory Will Lead To Western Disintegration

"In the aftermath of last week’s disaster for the Fed, today Canadian legend John Ing warned King World News that the current debt trajectory will lead to Western disintegration and soaring gold prices.  Ing, who has been in the business for 43 years, also spoke about the devastating situation the Fed now faces as the world gets closer to turning its back on the US.  Below is what the 43 year market veteran had to say in this powerful interview.

Ing:  “Unfortunately, the pattern we have seen in history when countries spend beyond their means and take on too much debt and can’t pay that debt, then we see default.  Default seems ridiculous because everybody says, ‘America can always print more.’ 

But we must look at Argentina as an example.  We are going to see the second default in 10 years in Argentina of sovereign credit.  So, unquestionably there is going to be a line in the sand.  It’s going to be twisted and bent line, but just as tapering can’t happen, the exit is going to be rebranded and it will just be an attempt to pile on even more debt.  The problem is, as we have seen in Europe, it’s unsustainable and it will end in tragedy.

All of this will be left to Bernanke’s successor.  We also know that because Bernanke’s successor will be dovish, the harsh reality is that eventually America is going to have to be told to stop printing.  America will essentially be told that they can’t keep producing dollars to service their debt.  But the dollar will experience a major devaluation.  That is what we are going to see rather than default.

America has been prolific at debasing its currency, and for a long time everybody has accepted that.  But the problem America faces going forward is the rapid emergence of the Chinese currency.  The Chinese already have one of the top ten currencies in the world.  However, my expectation is that the classic currency choice in the future will be gold.”

at http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/9/24_Current_Debt_Trajectory_Will_Lead_To_Western_Disintegration.html