John Embry comments to King World News about today's intervention against gold

Dear Friend of GATA and Gold (and Silver):

King World News just got an interview with Sprott Asset Management's John Embry about today's central bank intervention against gold. Embry takes it a little more calmly than some of us do, remarking: "That's just the nature of the gold market right now, but in the fullness of time, it's just building a larger and larger base, which will carry it much higher when it goes, and it will most assuredly go." The market riggers "know it's going to go, because the only out they have is excessive money printing and so, consequently, they want gold to move from the lowest possible level."


Embry - $2,500 to $3,000 Gold Could Send Silver to $250

With gold trading above $1,700 and silver over $32, today King World News interviewed John Embry, Chief Investment Strategist of the $10 billion strong Sprott Asset Management to get his take on where he sees gold, silver and the mining shares headed.

When asked if there was any chance for the central planners to save the system, Embry said, “Zero. I’m a huge believer in Austrian economics, so you have to know where I’m coming from. Ludwig von Mises, the Founder of Austrian economics, said it best, when you have an excessive credit cycle you only have two choices.”

John Embry continues:

“You can stop it when it gets beyond where it should be, and it’s way beyond where it should be now. You can either take the pain and clean out the debt or you can continue to try and create more and more debt to keep the other stuff afloat and have a complete collapse of the currency system. Well, we’ve opted for the latter and that’s where we are going.”

Embry had this to say about the action in gold, “We are building a massive base and when there is any bad news for the system as a whole, gold gets clobbered. They do not want it to be seen as a safe haven asset at this point. As soon as Draghi suggested that the ECB wasn’t going to buy the bonds, gold got crushed and it got crushed way more than the Dow. That’s preposterous.

That’s just the nature of the gold market right now, but in the fullness of time, as I said, it’s just building a larger and larger base which will carry it much higher when it goes and it will most assuredly go. I sort of take the view that they (the cartel) know it’s going to go because the only out they have is excessive money printing and so, consequently, they want gold to move from the lowest possible level.

If you went back to Labor Day, when gold was blasting through $1,900, and then laid out everything that was going to happen in the subsequent two or three months, then I told you gold was down over $200 you would say that’s impossible. But that’s just the nature of the market....

“I think one thing that has to be realized and it is the core argument to the whole gold bull, is that there is no other direction for all fiat paper currencies at this point than down. Gold and silver are constants. They have been constants for centuries and centuries. So as these paper currencies in which they are valued inevitably fall, the price of gold and silver have to go up.”

When asked about the mining shares, Embry stated, “I think with each passing day, as I look at some of these quality juniors, I’m not sure I’ve ever seen them cheaper, with the possible exception of the 2008 crash when everything was being brutalized. But in this case it’s the junior gold shares that are being singled out to be clobbered for reasons that escape rational thought.

I think we’re building up when the gold price goes and it’s going, to one of the great explosions in the stocks. I would actually recommend to people to dig around and find a list of good quality juniors, you are going to have to do some research, but find a good list. I would be shocked if gold went to $2,500, $3000 that you didn’t make five and ten baggers (times) in some of these things.”

When asked about silver specifically, Embry replied, “As you know I’ve been very vocal on the subject of silver. When gold goes, silver is going to go further for the simple reason that in extended bull markets for precious metals, the gold/silver ratio tends to fall.

Historically it’s gotten down as low as ten or fifteen to one. It’s currently over fifty. So consequently silver has all sorts of room on the upside. For instance, $2,500 or $3,000 gold, that could underwrite $250 silver. Think about that, that’s eight times where it’s trading today.”

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/12/8_Embry_-_%242%2C500_to_%243%2C000_Gold_Could_Send_Silver_to_%24250.html

Dan