Rick Rule – The Availability Of Physical Gold Will Disappear
October 4, 2012
Today Rick Rule told King World News “At some point we will see the availability of physical gold disappear when we begin to see widespread public ownership like we witnessed in the 1970s.” Rule, who is now part of Sprott Asset Management, also noted that “… gold will do well because the value of currencies will continue to erode.”
Here is what Rule had to say: “It was a nice catch by Michael Pento the other day on KWN, and I suspect he’s exactly right that we are looking at QE4. It seems to me that regardless of the excuse, the Fed will find ways to add liquidity into the system for a couple of reasons. First, they feel the desperate need to keep the system, at least a big part of the system, liquid, in order to avoid a 2008 style decline.”
Rick Rule continues:
“But the second reason is, in addition to buying back mortgage-backed securities, they have to continue to issue short-term debt to fund their spending obligations, and they can’t sell that short-term debt to anybody else. They literally have to add liquidity to the system in order to buy their own paper (debt).
I think Michael Pento very correctly identified the fact that in addition to making the commitment to buying $40 billion worth of mortgage-backed securities every month, to keep the mortgage system flowing, they also need to do a type of stimulus which allows them to sell the paper that funds their ongoing operating deficits….