Sinclair - Is the Fed Selling Europe’s Gold During Interventions

Today legendary trader and investor Jim Sinclair told King World News that a number of European countries are beginning to ask themselves where the gold is coming from which is being used for interventions in the gold market.  Sinclair also said some European countries are beginning to think it’s their gold, stored by the US Fed, which is being used for these interventions.  But first, here is what Sinclair had to say about the recent plunge in gold:  “Eric, this has been going on since $248 in gold.  Any idea or concern that this kind of intervention is going to cause the gold bull market to cease or shorten or even contain where it will potentially go is simply wrong.”

Jim Sinclair continues:

“Every time you intervene in any market or any time you intervene economically, it’s the same as using a controlled drug.  The first application gives you the best high you’ll ever have.  After that you have to do more and more just to near duplicate what you expected.

The selling down of the gold, what this means now is time....

“If in fact they can’t bring the market under the $1,600 level, then the demand here is beyond the willingness for intervention.  That means that if the demand is greater than the supply, the price is going to rise.  

If gold does go through $1,764 and stabilizes there, you are beginning an unwind in terms of gold cooperating with the management of perspective economics (MOPE).  (Central planners) would want gold to be very soft at a time when a credit event takes place in Greece, that very few of the participants and even bondholders knows yet exactly what happened.”

Jim Sinclair had predicted many European countries would want their gold back, which is being stored by the Fed in the US.  This movement is beginning to take hold in Switzerland and Germany as well as other countries.  When asked about his prediction beginning to take place, Sinclair responded, “It had to happen because we all ask ourselves the question, ‘Where does the gold come from on these attempts at intervention?’  Because it’s not simply paper gold, it’s also in the cash market.  There is a concern that the gold that’s being used to intervene might not be our (US) gold.  

Basically they (Germany, Switzerland and other countries) are now asking the question, where is the gold coming from?  There are two possibilities, Fort Knox or the Federal Reserve seller, in the cash sense.  Fort Knox, nobody knows what’s there.

Everybody knows what’s at the Fed, other people’s gold.  The trend that we discussed a long time ago which is really turning into a modest torrent, is to take back gold.  I mean the truth is what do the Germans need the Fed to store their gold for?  Are they afraid France will invade?  It doesn’t make any sense.”   

Jim Sinclair provides some extraordinary insights in this interview.  He discusses the gold plunge and what investors should expect next.   He also goes into detail about key events that are currently unfolding.  The KWN audio interview with Jim Sinclair is available now and you can listen to it by CLICKING HERE.

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Eric King