Posted on 26 August 2015 with 1 comment from readers
Central bankers are starting to lose control over financial markets from China to main street USA warns veteran gold trader Jim Sinclair who once advised the legendary Hunt Brothers.
‘They got the dickens scared out of them,’ he says in an interview with usawatchdog.com (click here). ‘They actually backed off providing the funds necessary… That’s your warning. The warning is markets can overrun plunge protection teams. Markets can and will overrun the manipulation of metals and currencies.
Dollar going down
‘The market will overrun the false strength in the US dollar. The idea that a lift in interest rates would be beneficial to the dollar is absolutely incorrect. We do know the limits of the Plunge Protection Team, and we do know the omnipotent power of the Fed is a total fallacy.’
Turning to his lifetime specialty, Mr. Sinclair recalls: ‘I didn’t call the top in gold in 1980 because of any kind of a system. I was told, I acted on what I was told.’
What are these voices saying now? ‘Number one, the downside on gold is extraordinarily limited here. Two, the rally we are facing that will come in gold is going to be stupendous. Three, they tell me we may never call you back because this may be the rally you don’t sell.
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‘This may be the rally you don’t sell because gold is moving from a currency form to a valuation form… This may be the last time we call you means this is a rally that is not meant to be sold.
‘What is coming up in front of us is the Great Reset where currencies wear their gold like ladies wear a necklace, and the most beautiful necklace will be the strongest currency. The ladies without the necklace won’t be invited to the ball.
Mr. Sinclair stands by his prediction last year of an eventual gold price of $50,000 an ounce. He explains: ‘You have to understand we are going into unprecedented deflation, and it’s the reaction of central banks around the world to the concept of deflation that brings about hyperinflation.
‘There will be debt monetization of all kinds of debt to maintain some sort of equilibrium. The price of gold is going to go to a level that is going to surprise everybody. I was told that this is a rally that you won’t sell.
‘That means gold will go to a level and not react violently down from that level… This is when gold is going to levels that today are considered more mental illness than monetary analysis.
‘Silver is best understood as gold on steroids because whatever potential and direction is taken up by gold, silver will be multiplied by two or by five… Silver will outperform gold.’