James Turk & Paul Brodsky: We Are In A Fiat Currency Bubble, The Markets Have Begun To Wonder Whether The Fed (And Other Central Banks) Will Ever Be Able To Exit From Its Quantitative Easing Policy
James Turk of predicts gold will reach “$11,000” per ounce in the next five years. Turk goes on to say, “It might come sooner. It depends on when confidence finally breaks, & we’re getting very, very close to that stage. There’s nothing holding t…
On the heels of gold and silver surging, today King World News wanted to check in with the firm that is calling for $10,000 gold. Paul Brodsky, who co-founded QB Asset Management Company, had this piece regarding the Fed’s so-called exit, destructive hyperinflation and the gold market: “The markets have begun to wonder whether the Fed (and other central banks) will ever be able to exit from its Quantitative Easing policy. We believe there is only one reasonable exit the Fed can take. Rather than sell its portfolio of bonds or allow them to mature naturally, we believe the Fed’s only practical exit will be to increase the size of all other balance sheets in relation to its own.”
Paul Brodsky continues:
“This ‘exit’ will be part of a larger three-part strategy for resetting the over-leveraged global economy, already underway. The first stage is policy-administered monetary inflation – QE in which the Fed is de- leveraging bank balance sheets by adding bank reserves. The second phase will be policy-induced price inflation – hyper-inflating the general price level enough to diminish the burden of debt repayment and gain public support for monetary system change. (Imagine today the Fed proclaims all one dollar bills are ten dollar bills. Goods and service prices would increase 10x, more or less, as would wages, asset prices, revenues, costs, etc. The only item on the balance sheet that would not increase 10x would be the notional amount of systemic debt owed.) We believe the third phase of the strategy will be a monetary reset that recaptures popular confidence following the hyper-inflation.
The Fed is trapped. There is no exit, at least one without considerable consequences. That’s why Bernanke hasn’t announced plans to exit the Fed’s bond buying program. He doesn’t have one.
Gold $8,000, Silver $200 in New Trade Finance System-Jim Willie
Dr. Willie says, “Europe is on the verge of collapse.” When it does, Dr. Willie says a new “Gold Trade Finance System” is already in place to take over for the dollar. Dr. Willie’s sources say, “The trade finance system has already agreed on a gold price of $7,000 to $8,000. Silver would be $150 to $200 per ounce.”