With continued volatility in gold and silver, today King World News interviewed James Turk, Founder of GoldMoney out of Germany. When asked if we had seen the lows in the metals Turk stated, “You can never predict how long a correction is going to last or how deep it is going to go, but sometimes you get clues as to when a correction might be ending. What we’ve had is a bullish divergence in gold and silver. So we have a pretty good level of certainty that the low prices in this correction are in place.”
“We may have a little bit more time to go in terms of backing and filling and I don’t rule out another test of $35 on silver and maybe back into the $1,520’s on gold. But on the other hand gold looks very, very powerful here. It hardly corrected at all compared to silver which is why the ratio has gone back up over 40.
I’m sticking to what I said last time we spoke that this summer is going to surprise a lot of people, how powerful the metals are going to be on the upside.
Here in Europe the Greek situation is getting worse and worse. They’ve missed all of the targets that the Europeans imposed on them. The civil unrest is becoming more and more strenuous because none of the politicians have ended up in jail, and the guys who are responsible for all of the corruption, none of those guys ended up in jail.
Governments have been trying to solve the debt problem by taking on more debt and you can’t solve a debt problem with more debt, it’s just basic math. The sooner they realize that, the sooner we’ll get out of this mess. By piling more debt onto undercapitalized banks, it’s just going to make the problem that much worse when it finally hits...
...That’s why I keep coming back to the major issue that we face which is a currency collapse, a collapse of the US dollar. We are on this road to what I call the fiat currency graveyard and if politicians and policy makers don’t do a u-turn, we’re going to get to that graveyard.”
When asked about silver specifically Turk had this to say, “Silver is sort of taking a back seat for a while and that’s ok. It was the star for nine months, so it’s resting...If you are a silver bull don’t lose heart here, it’s just a normal rotation between the metals. I think a lot of the hedge funds are starting to play the other side of the trade.
For a while the trade was to be long silver and short gold and now those trades are being unwound. They (hedge funds) are being long gold and short silver, but this is only going to last a couple of months. If gold is stronger this summer as I expect, then silver will be stronger as well.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/6/2_Turk_-_Metals_Will_Be_Hot_This_Summer,_Gold_to_Hit_New_Highs.html