Caesar Bryan - Suspicious $1.5 Billion Gold Dump & Bank Runs

kingworldnews.com

With continued volatility in gold and silver, today King World News interviewed 25 year veteran Caesar Bryan. Gabelli & Company has over $31 billion under management and Caesar Bryan has managed the gold fund since its inception in 1994. Caesar told KWN the European banking system is stil on fire, and we are now seeing bank runs in both Spain and Italy. He also stated that today’s trading at the end of the day in gold was very “odd.” Here is what Caesar had to say about the situation: “We had been having a recovery in the price of gold recently, but then gold was taken down around 1:15 pm today. There was quite significant volume in the last 15 minutes, before the COMEX closed.”

Caesar Bryan continues:

“There were 10,000 contracts traded, which is something like $1.5 billion, and gold fell precipitously, from about $1,665 to about $1,650. This is very odd trading on a Friday afternoon when there was no other discernible movement in other markets.

This made for a disappointing end to the week, but the backdrop for gold is still very solid. However, for investors, it’s hard to ignore the day to day movements.

As you know, we have been talking about what is going on in Europe. The latest news is that tension remains high in places like Spain....

“Spanish yields today were about 5.94, which is up 21 basis points relative to German 10-Year bonds. That spread has now grown to about a 420 basis point spread.

If you go back and look at the history of that spread, since the introduction of the LTRO, where Spanish banks were very active participants, Spanish rates briefly came down to about 320 basis points. Now they are back up to 420. So, rates are back to levels seen just prior to the December introduction of the LTRO.

Also, the Spanish banking system borrowing from the ECB rose to about 370 billion euros in March, relative to about 170 billion euros in February. The bottom line here is the Spanish banks are very reliant on the ECB, and this is very dangerous.

According to Bloomberg, in March, 65 billion euros left the Spanish banking system for ports in Northern Europe. So, there is major capital flight out of both Spain and Italy, into places like Germany, the Netherlands and places like Luxembourg.

We are hearing from many European leaders that the crisis in Europe is over. I don’t believe that is the case. There’s going to have to be decisions made in Europe, and I think the obvious one is the central bank there is going to be much more active.

They are going to have to do another long-term LTRO, and maybe purchase Spanish bonds in an attempt to keep Spanish yields under control. This is a very serious situation in Europe, and there will be more monetary easing, as there is in Japan, here, the UK and, of course, Switzerland. All of this is positive for gold.

Here, in the US, we had a couple of dovish speeches from members of the Federal Reserve. But that doesn’t matter. It’s what the Fed does, not what officials of the Fed say. And the fact of the matter is that interest rates cannot be allowed to rise in this country because of the massive deficit.”

When asked about silver, Caesar stated, “I think silver is fine. It will tend to follow what’s going on in the gold market. Today it was hit, down 2.5% or 85 cents. We had a better day yesterday, but silver companies are very profitable at this price. Silver, like gold, is poised to move higher.”