With gold and silver rallying on the heels of continued US dollar weakness, today James Turk told King World News that we may see an explosion in the price of gold and silver this summer that will literally shock the world and catch professionals and private investors totally by surprise. Turk cited a remarkable advance in the price of gold and silver three decades ago which may serve as a potential roadmap, and also help KWN readers around the world to understand the massive upside potential here.
Eric King: James, what might surprise people this summer?
Turk: Normally the summer is a quiet period, Eric, but every once in a while you do get a black swan event and it surprises people, and the market can really take off. This happened back in 1982 when one of the Mexican debt defaults led to some bank failures in the United States.
With sentiment so low and very few people paying attention at the moment, maybe the summer is going to be the surprise. Maybe this will be one of those rare summers where you see a big move in both gold and silver to the upside because of some kind of event…
The bottom line when it comes to markets, Eric, is always be ready for the surprise. Always expect the unexpected, and maybe this summer is setting up for that kind of event. Back when we had the Mexican debt default in the 1980s, the gold price went from $300 an ounce to about $500 an ounce over a period of around ten weeks. It was a sizable move and it caught everyone by surprise.
Eric King: James, what is the danger you see going forward in the financial system that could be the big catalyst to get gold and silver out of this base?
Turk: The big danger that everybody is facing is the destruction of national currencies and these crazy policies that central banks are following around the world.
But it really comes down to something more fundamental than that, Eric — We’re seeing repeated interventions in so many different markets. The markets are being distorted. And what happens from these repeated interventions is that essentially governments could end up destroying markets themselves.
The final conclusion would be putting capital controls in place. All we have to do is look at a place like Argentina and see what they’ve done to their currency and to their economy. Continuous interventions and eventually capital controls have taken Argentina back years in terms of economic development (as well as causing tremendous wealth destruction for the citizens). And unfortunately most of the major Western governments are following these same crazy economic policies.”
After the interview James Turk sent the following note to KWN regarding the massive spike in the price of gold during the summer of 1982: “Gold was $298 on June 22, 1982 and rose to $486 on Sep 8, 1982. These are closing Comex prices, so the intraday swings were enormous. That is a remarkable 60% move in the price of gold in just 2-½ months. Silver also advanced 80%.” King World News note: If we were to see a repeat of the 1982 performance it would send the price of gold $840 higher this summer. In reality, a 60% advance in the price of gold this summer would literally shock the world.
Source : KWN