Leeb - US Government Desperate & Scared Regarding Gold

kingworldnews.com

Today Stephen Leeb told King World News the US government is now showing signs of desperation and fear regarding the gold market. Leeb is concerned the US is destroying its own currency and was not at all impressed by government efforts to label goldbugs as terrorists. Leeb is the acclaimed money manager who is Chairman & Chief Investment Officer of Leeb Capital Management. When asked how he responds to the government labeling him and others as potential terrorists for owning gold and suggesting people buy gold because the US is going broke after going off the gold standard, Leeb stated, “The nature of a comment like that strikes me as desperation. When you are turning up the printing presses, common sense tells you that you are destroying your own currency.”

Stephen Leeb continues:

“You could probably get away with that if there were not an alternative currency out there but there is and it’s called gold. People are scared to death and whoever is saying that in the United States is scared to death that people will pick up on gold as an alternative currency.

They are also probably scared that China is buying so much gold. So when you hear these kinds of comments coming out it tells me that somebody is really worried. But clearly those kinds of comments speak of some kind of desperation, that’s how I see it.”

When asked what he is focused on in the gold market, Leeb responded, “Clearly Berananke still has his foot on the accelerator, I think the overall outlook is very, very good for gold. Clearly with China buying a lot of gold, the outlook for gold is very good, especially given there is very little incremental supply of gold (available for sale). Gold paused because of Europe. No one knows which way Europe is going....

“Everything has stopped in front of Greece. What are they going to do? We really don’t know yet. Now a couple of scenarios emerge. They are ‘when’ scenarios. It’s ‘when’ will gold go up dramatically, not whether it will go up dramatically.

(One scenario) If something goes awry in Europe, that could easily lead to a sharp and very big selloff in gold, just as was the case in 2008. People sold gold because they needed liquidity. Gold went down sharply and then it just zoomed (higher). It was like a rocket ship on the way back.

If it happens it will be temporary and you should buy all you can possibly buy because if you think we are flooding the world with money now, wait until you see what happens if Europe really starts teetering. They will literally, as Bernanke once said, they will be dropping it (money) from helicopters.

I think gold is setting up for a big move. No deflationary hiccup, which is basically what I would guess is going to happen. They will work things out in Greece. It’s not 100% certainly, but I would place the odds somewhere between 80% and 90%. In that case, I think it’s all clear for gold.

You may get a little volatility but then gold is off to the races. You’ve got our Fed ready to hit the accelerator again. The Europeans know they have to get things going. China is getting ready to ease. China is buying more gold and the available gold (for sale) is shrinking. So you don’t have to be a genius to say gold is going to go a lot higher.”