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Rick Rule: What to do if you’re frustrated by the gold and resource markets


From King World News:

Today, King World News interviewed one of the wealthiest and most street-smart pros in the business, Rick Rule. Rule is founder of Global Resource Investments, which is now part of the $10 billion strong Sprott Asset Management. KWN reached out to Rick to get his take on what is happening in key markets.

Here is what Rule had to say:

“I guess two things stand out to me. The first is it’s amazing how much complacency the various central governments can buy with the liquidity they are pumping into the market. You have the situation in Spain, which is looking like Greece on steroids, and nobody seems to care because of the liquidity coming into the markets.”

… “I’m too old to wish for chaos, but it’s coming. I think the market’s response to situations that make otherwise rational people seem nervous, is fairly amusing. What we are seeing right now is the rising tide of liquidity floating most ships, particularly the conventional ships.

I’m a little surprised that the liquidity we are seeing in the markets, particularly the resumption of short-term credit and inter-bank credit, hasn’t led to increased commodity fund buying of gold. What I’m saying is I’m a little surprised that more of the liquidity hasn’t found its way into the gold market.

… Most likely, the liquidity has gone into the biggest and broadest asset classes like bonds and high quality equities. It has, therefore, avoided fringe markets, even fringe markets as large as the gold market.

You know, Eric, for investors who are frustrated, past is probably prologue. They need to have a sense of what happened in…

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