Turk – No Time To Wait For A Pullback, Gold To Hit New Highs
September 10, 2012
Today James Turk urged King World News readers to, “Keep accumulating gold and silver on a cost averaging basis because the currency cliff is fast approaching.” Turk also cautioned, “I would add there is lot of money out there that is waiting for a pullback, but given what is happening around the world, I don’t think there is time to wait for a pullback.”
Here is what Turk had to say: “Gold and silver are taking a bit of a breather today, Eric, which is to be expected after last week’s huge price surge. Also, another reason I think the metals are quiet is because everybody is trying to figure out what the Federal Reserve will be announcing after their meeting concludes on Thursday.”
James Turk continues:
“The Fed has set the stage for another round of Quantitative Easing, which of course will be inflationary, and therefore bullish for gold and silver. But what the Fed always tries to do is control expectations. They place greater emphasis on the notion that inflation is not a result of how much currency is actually in circulation or how rapidly the quantity of currency grows, but rather, whether people think inflation will worsen.
Like many things that come from central banks, it is a silly notion. It is another one of those things that seem okay in theory and the halls of academia, but never works out in the real world. The reason, as Milton Friedman and others have pointed out, is that a currency’s purchasing power will be eroded if the quantity of money increases….