Gold passes $1,450, silver almost $40-an-ounce, what comes next Mr Sinclair?
Posted on 06 April 2011 with 4 comments from readers
Gold finally passed the $1,450 barrier last night and silver is closing in on $40-an-ounce this morning. The next stop for the yellow metal must be a battle to cross $1,500 and silver could well spike to its old all-time high of $50 set back in 1980.
Superbug Jim Sinclair commented: ‘Expect the Round Number Effect at $1500 for gold (several crossings and retreats from that price), but less severe than the battle at $1,400. Angel $1,650 (Sinclair’s next target) is quickly coming into focus.
$12,500 gold?
He then muses: ‘Think for a moment if Armstrong and Alf (two fellow gold bugs) are right on gold. That would mean the following prices are coming: $1,650; $3,000; $5,000; $12,500.
‘Those prices are possible because the balance sheets of the entire western world financial entities are based on false assumptions yielding valuation that pass auditing (FASB) but will never come to fruition. It is the mark to maturity method that not only used the BIS but other institutions that give comfort to the masses that are not looking at self protection here and now.
‘The financial system of the entire western world is FUBAR and there is no intention anywhere of fixing the problems at the level of its cause, OTC derivatives. The EU outlawed naked credit default swaps which is a clear comment on their ability to work if put under pressure. This is regardless of whether they were margin or naked in my opinion.’
The Realization
Mr Sinclair then has one of his famous affirmation lists to give his many fans on his website (www.jsmineset.com):
Realize that the system has already failed.
Realize that there is no champion in a power position with the will to fix it.
Realize that even if there was a true fixer there are absolutely no tools to apply that would not in a short time cause more severe pressure than before applied.
Realize then that there is no PRACTICAL means to get the western world financial economy back on its feet.
Realize that since the entire western world financial entities are based in sand there can be no sustainable economic recovery anywhere in that group.
Realize that a third war of any degree is madness.
Realize that our actions in the Middle East will cause increased hatred of the West.
Realize that the problems in the Middle East are not pro West or pro democracy.
Realize that gold is going to some degree make my long term price objective, given you ten years ago, look so low it will be silly.
It is another victorious day for the gold and silver bugs. However, pride often comes before a fall in price in markets, so watch out! Gold and silver rise in a jagged pattern and not a straight line. If you buy at a short-term top you will have to ride out the correction and wait for the upturn.
In 2008 Mr Sinclair was also a cheerleader right up until gold plunged by 30 per cent and silver over 50 per cent in the global financial crisis, before making an amazing recovery.
But if Mr Sinclair is right, and he has actually been for more than a decade then what comes next will be well worth waiting for, and there will not be long to wait. The ArabianMoney newsletter this month considers the best strategies to profit from precious metals (click here).
4 Comments posted by readers:
I suppose that, when the gold:silver ratio is 1:16 or thereabouts, it would be worthwhile getting out of silver in increments and buying gold, on the basis that the ratio will begin to go up again on some sort of journey towards 1:60.
What would Mr Sinclair say about that?
Ed Note: Best email him through his website.
I can’t argue with any of Jim Sinclair’s statements on his “affirmation list”.
So I’ll add another one:
Realize that western governments know their financial systems and accounting methods are all fraudulent, and that there is “no way out.”
Using deductive reasoning, those who agree with Sinclair’s statement, and the statement above, will realize that it will only get much worse from here.
“Realize that western governments know their financial systems and accounting methods are all fraudulent, and that there is “no way out.” ”
Astute observation. Doing God’s work must help.
They cannot possibly make disappear the mountain of derivatives, all they can do is shuffle it like a hot potato. There is even a number, 1.5 quadrillion. The cruel joke is, they were all bkp without TARP and the refinancing of bad banker bets with taxpayer money. I can see gold at any number. But also a sack of rice too.
James M: “I can see gold at any number …
I was buying gold and silver prior to the global financial crisis, convinced that it was a good investment for “a few years.” Now, I also can see gold at any number!
Where’s the Leadership?
That was then, before I realized that no western government leader had the courage and fortitude to “do the right thing” and allow a few big banks to go bankrupt. Instead, they all caved in to the financial community’s threats (“…if you don’t bail us out continuously for a few years, there will be a global financial meltdown”).
Without question, what we have here is a total failure in leadership, beginning with the USA (and sadly, I have to admit that I was a VERY strong supporter of Obama in 2008. For a very interesting read on leadership failure here in the USA, read Obama’s own words in 2006, about what it takes as President of the USA to be a true leader.
Shocking!
Go here:
http://www.zerohedge.com/article/obama-confirms-leadership-failure-pulls-out-mother-all-mutual-assured-nukes-raise-debt-ceili