Disappearing Gold Inventories, Financial Collapse & The Fed

Today outspoken Hong Kong hedge fund manager William Kaye spoke with King World News about disappearing gold inventories, financial destruction and the Fed.  Kaye, who 25 years ago worked for Goldman Sachs in mergers and acquisitions and who is the founder of Pacific Group, had this to say in part I of an extraordinary written interview series which will be released today.

Kaye: “Stocks in our opinion have been driven higher by all of this cocaine from the Fed and the other central banks.  So we live in this financial Potemkin village in which stocks are overpriced.  I can’t give you a date as to when they will collapse, but I can tell you with great certainty that they will.

Bonds are widely overpriced with the obvious reason that the Fed itself is 70% of the US Treasury market.  So stocks and bonds are overpriced and everyone is printing money.  Just in the last week the ECB lowered rates and told you in the narrative they would lower them further....

“So the bias is to lower rates further to print more money, not less.  The Fed is already at zero and is injecting one trillion dollars a year at this rate, $85 billion a month into the system.  This is new money.  This is expansion of the Fed’s already huge balance sheet.

They are gaming the system by acting like there is a debate about it.  Charles Plosser comes out, and it’s like a kabuki theater.  And they use their hack, John Hilsenrath, who I’ve met, he’s been to my office, to come out and again try to put fear in the heart of investors, and scare honest people away from the only refuge that exists in the world, and that’s precious metals.  The actual tangible precious metals.

So Hilsenrath comes out with his piece, and at a time when the manipulation (of gold and silver) is getting extremely intense, and tries to plant this fear in people’s minds that the Fed will actually exit.  I’m here to tell you that there is no exit.

The reason there is no exit is as soon as they exit, or try, the system will collapse on itself.  The only thing keeping everything going in this fictional world is one trillion dollars per year, which almost exactly matches the size of the US government budget deficit.  This means until it does collapse it can keep going.  This is how it’s getting financed.

Then, take a look at what has happened in history when similar policies were followed.  Why would you want to own a currency that is being so thoroughly debased?  And it’s not just the Federal Reserve.  The ECB is doing the same thing.  The Bank of England is doing the same thing, and the most aggressive culprit of all now is the Bank of Japan.

So that’s the setup.  That’s the real world.  Pay no attention to Hilsenrath, he’s just a hack.  Pay no attention to the bullion banks who keep putting out these bear market reports and low forecasts for gold, trying to scare everybody out.  These are the same people who are short gold.

ABN AMRO is one of the most bearish banks on the price of gold.  ABN AMRO has already defaulted on gold.  In other words, they don’t have any gold.  About one month ago they sent a circular out telling their own customers who own their paper which says, you own gold, ‘Don’t call us and redeem this paper for gold.’

So ABN AMRO doesn’t have any gold.  And if you check the public information, JP Morgan has almost no gold.  They are at modern era record lows in their warehouses.  The COMEX, as of the last report I looked at, had under 200 tons of gold.  That’s also a modern era record low, against enormous liabilities to deliver gold.”

The information above was part I of a written interview series which will be released today with the outspoken hedge fund manager from Hong Kong.  Kaye, who roughly 25 years ago worked for Goldman Sachs in mergers and acquisitions, discusses the desperate situation Western central planners face in the physical gold market, and what is happening with global demand and the plunge in available inventories.  The incredible audio interview with William Kaye is available now and you can listen to it by CLICKING HERE.