Big Money Anticipating Another 1970s Style Gold Mania

July 19, 2013

Today one of the top CEO’s in the world told King World News that big money investors are positioning themselves ahead of what they believe will be another 1970s style mania in gold.  This interview is tremendous, and it will let KWN readers around the world see the gold market through the eyes of one of the greatest and well-respected veterans in the business.  Here is what Sean Boyd, CEO of $5 billion Agnico Eagle, had to say:  “We believe this is just a correction in gold and that it was orchestrated in the paper market.  The flip side has been incredibly strong physical demand and continued central bank buying.  We see this as a tremendous opportunity.

Sean Boyd continues:  “Gold equities are at historic lows and the companies are working on their business models and putting together plans that will allow them to weather this volatility and be in a position to participate when gold moves higher.  We firmly believe this is just a short-term blip, and gold will go right back to the $1,800 level….

“This rise could take some time, perhaps as much as the next twelve months.  We look at this in terms of what happened in April.  It was a well-orchestrated trade (manipulation) that was extremely profitable for the shorts.

But when we look at the physical market, we still see people wanting and needing to own gold, and those people are taking advantage of this opportunity to accumulate and build positions at prices they did not think they would be able to do it at.

Over the short-term there may be some continued volatility here, and I wouldn’t be surprised to see hedge funds still trying to attack the price creating moments of weakness in gold, but we firmly believe the market is going to be constructive going forward.  Nothing has been fixed.  If you actually look the analysis that’s being done by a lot of the major banks stating that gold’s days are over, basically what they have put forward is a Goldilocks scenario.

And when you actually press them on it they say, ‘Well, yes, my assumption doesn’t include any currency wars, and it assumes that economies are going to continue to move forward and grow at a pace they haven’t grown at in years.’  And we just think that Goldilocks scenario makes absolutely no sense, and that there will be serious issues in the debt market in the future.


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