Eric Sprott - Mainstream Bashes Gold, But New Highs Coming

Today billionaire Eric Sprott told King World News the central planners are desperately trying to convince the masses that everything is okay.  Sprott, who is Chairman of Sprott Asset Management, also said the mainstream media continues to bash gold.  But first, he had this to say about the global economy:  “I think it’s safe to say we’ve hit that ‘Minsky moment’ where the productive capacity of the country is not capable of paying off the debt.  All we’re trying to do is push it down the road so maybe there is some luck and these economies will come to life.”

Eric Sprott continues:

“But all the data we get, whether it’s European PMI, UK GDP, almost any data point we get seems to point to a contraction in Europe.  So it’s pretty hard to imagine that anyone is going to pay off their debt when their GDPs are contracting.

So, I think it will be an ongoing process.  The powers that be are trying to convince the masses that everything is okay, but the opposite is the case....

“One of the things I’ve written is sort of the unintended consequences of this very liberal financial situation going on in the G6 countries.  I think if I was a non-G6 country looking in, such as China or Russia or India, I’d be thinking:  What are those guys up to here?

They keep propping up their banks and they keep buying their own bonds.  I’m no longer likely to be a buyer of those bonds, and if I’m not a buyer of the bonds, what am I going to do with my excess reserves?” 

Sprott also added: “I think the HUI Index might have been at this level when the price of gold was $850.  Here we are at $1670 and the HUI is where it is.  Obviously the multiples have contracted markedly.

The mainstream bashes gold, including Chairman Bernanke ... indicating gold was an old, worthless standard that shouldn’t be considered.  But I think those of us who have studied what’s going on in the world economic situation, the world money printing situation -- we’re very aware of the merits of gold.

The merits of gold get better by the day, but the mainstream tries to downplay it.  It’s not something new.  We’ve gone through this for twelve years now.  But the majority of the main prognosticators in the world seems to think that gold is not an appropriate investment.

I think those of us who have championed it (gold) over the last twelve years have obviously been way more correct and we will have our day.  There are strange things that happen in the paper COMEX market that negatively affect the prices of both (gold and silver).

My view here is that before we end the year we will hit new highs in both metals.  Then the (mining) stocks would react.  The big problem has been there is not this momentum in the prices of bullion, which is keeping people away from the gold stocks.  If we can get the price of gold and silver going back up, I’m sure people will come back into the mining stocks.” 

Source : http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/3/29_Eric_Sprott_-_Mainstream_Bashes_Gold,_But_New_Highs_Coming.html