Friday , 26 May 2017

Egon von Greyerz: Gold & Silver Off to the Races – to $4,500+ & $100+ Each – Here’s Why

The closing of the gold window back in August 1971 has led governments  worldwide to create endless amounts of worthless paper money and the resulting credit bubble has created a world debt exposure of over US$ 1 quadrillion (including derivatives). It has also created perceived wealth for big parts of the world’s population – a wealth which is only backed by promises to pay and by   grossly inflated assets. Few people realise that this wealth is totally illusory and will implode considerably faster than the time it took to create it.  [Let me explain.] Words: 890

So says Egon von Greyerz ( in edited excerpts from his original article* entitled Gold & Silver Off to the Races.

Lorimer Wilson, editor of (A site for sore eyes and inquisitive minds) and (Your Key to Making Money!), has edited the article below for length and clarity – see Editor’s Note at the bottom of the page. This paragraph must be included in any article re-posting to avoid copyright infringement.

von Greyerz goes on to say, in part:

Gold reveals governments’ deceitful actions in destroying the value of paper money and the wealth of nations. Western governments dislike gold because gold tells the truth and the truth is that since August 1971 the US dollar has declined 98% in real terms [as can be seen in the graph below].


Before this debt cycle comes to an end in the next few years, the dollar and most major currencies are likely to finish their move down against gold and lose 100% of their value. Since 98 % has already been lost in the last forty-one years, there is really not far to go.

The final fall of currencies will be as a result of the unlimited money printing that governments will embark upon in the next few months in order to endeavour to “save” the world economy. Money   printing, however, does not save anything, it just exacerbates the situation. You can never become debt free by issuing more debt and you cannot create prosperity with   worthless pieces of paper.

The system is bankrupt

There has never before been a time in history when most sovereign nations are   bankrupt and when the financial system only survives due to false accounting (banks are allowed to value worthless toxic debt at maturity value rather than   market value) so, sadly, we are now likely to start the next phase in the world   economy which is a hyperinflationary depression.

Hyperinflation arises as a result of money printing which leads to the currency collapsing. Whilst the   price of most goods and services go up dramatically with hyperinflation, most of   the assets that were financed by the credit bubble like stocks, bonds and   property will collapse in real terms i.e. against gold.

Europe vs the USA

For the last couple of years, all the focus has been on the travails of the   Eurozone countries. The Eurozone individual members’ dilemma is that, unlike the   USA, they cannot print money. German political pressure stops that country from   printing money for the Greeks to retire at 55 or to support the Spanish banks   from collapsing. Germany is in a massive dilemma because if they contribute to  the Eurozone’s money printing, they will increase their exposure and throw good   money after bad. Also, it would be unacceptable politically. If they don’t print, however, the German government and banks are likely to lose in excess of €1 trillion which is their total exposure to the weaker European economies. Thus a virtual lose – lose dilemma for Germany awaits.

The focus on the Eurozone countries will soon move West across the pond. Virtually every important economic figure in the USA is worse than in Europe:

  • Both US debt to GDP and budget deficit to GDP are worse than Spain’s – and Spain   is seen as a basket case.

  • Real US unemployment (23%) is also much worse than in most European countries.

  • Also, if toxic debt and derivatives are included, US bank balance sheets are looking very sick. JP Morgan alone has a $100 trillion derivative exposure. And we know how quickly derivatives become worthless with JPM’s latest $6 billion write off.

  • In addition, the US annual federal deficit is   likely to remain in the trillions for many, many years to come.

These amounts  dwarf anything happening in Europe.

Shangri-La or Ponzi Scheme

As the focus shifts to the USA during the autumn:

  • there will be pressure on  the US dollar which eventually will put strong upward pressure on interest  rates. The free money bonanza with zero interest rates will come to an end with  US rates (and others) soon starting their journey to double figures.

Governments  and central bankers must have thought that they had invented a financial   Perpetuum Mobile. First you set interest rates at zero and then you print and   borrow unlimited amounts of money since it is all free. This way we can all   experience Shangri-la. But sadly, governments have not reinvented paradise but  only been busy creating a fraudulent Ponzi scheme and, like all Ponzi schemes, this one will also collapse creating worldwide social and economic misery for many generations to come.

Gold and Silver breaking out

Physical precious metals, as well as PM stocks, will continue to reflect the  destruction of paper money…Gold and silver have now started a major move to the upside. This move will be   relentless with only minor corrections before we reach $4,500 to $5,000 in gold and substantially over $100 in silver.


Investors now have a last chance to invest in gold and silver at prices which will never be seen again. For wealth preservation purposes, however, it must be physical metals and it must be stored outside the fragile banking system.


Editor’s Note: The above post may have been edited ([ ]), abridged (…), and reformatted (including the title, some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. The article’s views and conclusions are unaltered and no personal comments have been included to maintain the integrity of the original article.

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