On the heels of the historic Fed decision not to
taper QE, today 42-year market veteran John Hathaway warned King World
News this would destabilize financial markets and continue to send gold
soaring. Hathaway also discussed the dire situation the Fed and Western
central planners face, as well as how this will impact the gold market
in the long-run. Hathaway, of Tocqueville Asset Management L.P., is one
of the most respected institutional minds in the world today regarding
gold, and his fund was awarded a coveted 5-star rating.
Hathaway:
“It shows you that they (the Fed) don’t know what they are doing. This
also shows how off-base mainstream media is on their commentary. I was
watching financial television today and they gave this virtually no
chance of taking place.
Hathaway:
“Absolutely. I don’t understand how they have credibility in the first
place. The mainstream media worships these people at the Fed, but if
you look at their record on forecasting, I don’t understand it. As more
and more people start to understand the reality of the Fed’s true track
record, that will send gold to new all-time highs. Read More
Eric King: “John, your thoughts in the aftermath of this event (the Fed decision) which has shocked everybody.”
“I know KWN readers had today’s events
telegraphed to them ahead of time in the Greyerz interview, but the
mental anxiety you have to go through to take a stand, where you can see
that ‘black is black,’ but everybody else thinks ‘black is white,’ it’s
pretty tough to do.
It’s tough for investors,
and it’s (also) just sort of tough mentally to go against the grain.
But it’s been clear to me for some time that the economy stinks. It may
not be falling but it certainly isn’t robust. So the Fed is scared to
death that if they tweak it with any kind of tightening, the risks are
very much to the downside.
I think what we’ve done
here from gold’s point of view is it has been a great test. Gold
rallied off that low back at the end of June. This last three or four
weeks was a retest of that low, and it has now clearly held and we are
set for a solid move higher. The Fed and other central planner policy
makers are incompetent, and one thing is certain -- this will not end
well.
In this chaotic
environment, any thinking person needs exposure to gold and gold mining
stocks as a way to protect against monetary debasement. If anyone
thinks the Fed and other policy makers have the recipe to getting this
economy back on track so that we can get interest levels to a point
where people don’t need to own gold, they are smoking something funny.
It seems to me that the
position we are in today is the same trap we are going to be in 2 or 3
years from now, and maybe even worse. Again, I know it was hard for
investors to take this stance against the prevailing mainstream media,
as well as all of the brokerage-side commentary, but here we are -- the
Fed has chickened out. But I do think what it means is that gold has
been put to the test, it has stood the test, and we are now well
positioned for a major move higher.”
Eric King: “Is the Fed in danger of losing credibility here, John?”