Countries Move To Link Currencies To Gold

Leeb: “I think one consequence of what’s happened in Ukraine is to put Europe on notice. This means they have to make sure that their economies, not just the German economy, continue to grow. If they don’t, Russia’s influence will spread wider and wider.

Even the Baltic states could be in danger. Two of them have a large proportion of Russian-speaking people. Right now Latvia, Lithuania, and Estonia are all part of NATO. This suggests that while this conflict may be quiet for a day or so, it’s far from over.

The only real weapon the Europeans have is to strengthen their economies to keep them out of the grip of the Russian bear. So the Bundesbank has already endorsed quantitative easing. This is a big shift for the Bundesbank.

In India you are likely to have a nationalist elected. He is going to be very much pro-growth and I think the market is starting to sense this a little bit. We are seeing money moving into commodities. Many stocks that have been the leading performers this year are the commodity stocks or commodity-leveraged stocks.

These leading stocks are companies like Deere, Schlumberger, and Caterpillar. These leading commodity franchises have all been showing an outperformance over the general stock market. This stands in contrast to what we saw in 2011. At that time these stocks were falling sharply and dramatically underperforming the market.

This all has to do with the rebound in growth that is expected. Even when you look at China, they need growth as well. The United States needs growth too. The consequence of this growth will mean higher commodity prices, and I think gold and silver will definitely be beneficiaries.

As the West prints more fiat money and the flow of gold continues from West to East, it’s just a matter of time before the axis of power I have mentioned — Germany, China, and Russia — grows stronger. These are the economies of the future.

A lot of the world’s economy is going to revolved around this axis of power. So you will see Russia, Germany, and China as one power, and the United States as the other. The problem is that the United States will be running a distant second unless we wake up.

As an example, China just opened up another port for receiving gold. We know that China is buying at least 1,000 tons of gold each year, but the only place reporting accurate numbers is Hong Kong. How much gold is China going to take in through Beijing?

China and Russia are positioning themselves to have their currencies revolve around gold. As this becomes clear to the world, the price of gold will go into the stratosphere. It will be widely recognized that gold is coming back into the monetary system. This will also mean silver prices in the stratosphere.

People will look at the last few years as just one long consolidation on the way to skyrocketing gold and silver prices. How often can investors buy insurance with eight times the upside in price? This doesn’t happen very often but this is one of those rare moments.”