- GoldCore interview with Kerry Lutz on the Financial Survival Network
- Gradual realisation that central bank “masters of the universe”
“We all know that bad stuff is going to happen, we just don’t know when it is going to happen”
“The penny is beginning to drop that … we are coming very close to the end of the road”
- Prevailing wisdom that can print currencies with reckless abandon not being questioned
- We need a free market in currencies, not bail-ins and a war on cash and gold
- People blindly trust “experts” so welcome that some of them giving prudent advice re diversification
- Currencies of creditor nations – Norway, Switzerland, Singapore, Hong Kong will outperform in long term
- Mr Spreadbury of Fidelity “helped a lot of people in the mainstream who would never consider gold and silver”
- Avoid speculation, focus on diversification and owning quality assets for long term
Interview Transcript
Kerry Lutz: Mark O’Byrne, you know him well, executive director of Goldcore – a well known precious metals seller, bullion dealer, storage company across the channel is on the case. Mark hasn’t been on the show before but he is a very sage, savvy advisor on the topic of precious metals and how to protect your wealth. We’re really pleased to have him on – Mark, Welcome….
Mark O’Byrne: Hi Kerry. Thanks for having me on and for your kind words. I have enjoyed your show as well over the years. You are doing some good stuff out there so keep up the good work.
KL: Likewise, I follow your writing religiously. We all know what’s going to happen, we just don’t know when it’s going to happen but that’s going on now – when people in the mainstream finance – and Fidelity is the bedrock in the U.S. – they manage I think well in excess of a trillion dollars. When a guy like that tells you to put money in your mattress what are you supposed to think?
MOB: Yeah. It’s interesting and I think it shows that the concerns that many of us have had for a long time is percolating into the mainstream and the “smart money” who…they’ve almost been indoctrinated as well and they believed in the powers of the central banks as the masters of the universe. But some of the smart money… and as you said ….Fidelity, it doesn’t get any bigger that that, I mean they are one of the biggest mutual fund managers in the world, one of the biggest financial services companies in the worlds, they are absolutely massive.
This guy is very well respected, one of their bigger bond fund managers in the UK – about £4 billion worth of money that he manages. So for him to say that – and he wasn’t talking off the record, he actually told the Daily Telegraph.
The Telegraph, for your American listeners is , there are two papers of financial record in the UK, one is the Financial Times and the second one is the Telegraph so they are the newspapers, that people buy for markets, finance and business news. So for him to tell the Telegraph that is incredible.
He actually said specifically people need to own “physical cash” or “physical currencies” so he wasn’t even saying specifically – own physical pounds to a UK audience, he was saying physical currencies and that suggests maybe two or three currencies, not just one currency so he appears to be speaking to global diversification there.
He also mentioned, even more unusually for a bond fund manager – he told people to own precious metals, gold and silver specifically. So its very interesting and it got picked up very widely. It went viral on the Telegraph website and saw huge traction – people sharing it on Twitter, Facebook and all the rest of it. Zero Hedge picked up on it and they got huge traction with it as well. I think it was read by 180,000 people which is massive so I think it shows the that regarding risks that are out there … the penny is beginning to drop.
These risks have been building up for years and years and we got a temporary stay and a temporary reprieve in recent months and years as they kicked the can down the road as we all know but I think people are beginning to realise we are coming very close to the end of the road.
KL: What amazes me Mark is why now, I mean for people like you and I – we have not believed in the efficacy of central banking for decades now. We’ve questioned everything these people do – the Bernanke’s, the Greenspans, the Christine Lagarde’s of the world. We’ve questioned them and their infallibility, it’s just like the infallibility of the Pope right. I mean how could you think other wise if you are a thinking person who thinks critically and questions the world around you its just like Newton lying back there, and i know this is apocryphal event, of the apple hitting him in the head and it’s like “oh gravity” like thats to me”…..?” Why are they so late to the party here?
MOB: It’s hard to know. These eureka moments…. some of them seem to be having that. Maybe deep down they didn’t really believe in the modern Keynesian Doctrine that we have today in terms of the all powerful central banks and the notion that they could just print money with reckless abandon and there would be no ramifications – because that has been very much the prevailing wisdom of recent years.
Some of them maybe were a little bit skeptical of it but they went along with it. I suppose by the very nature of it – if you are fund manager and you work in a bank you have to go along to get along. You are not going to have a job for very long if you start asking the questions that this guy has bravely gone on the record and said.
Also, markets were working in their favour and have been booming for a number of years, stock markets and bond markets as we know are at all time record highs. This sentiment allied with momentum is a powerful thing.
Its a bit like, was it Chuck Prince at Citigroup who had the expression “as long as the music keeps playing we all have to keep dancing” and i think that is the prevailing philosophy with a lot of these guys.
Some of them are beginning to ask questions and I think a lot of them see the writings on the wall and they can almost cover their asses and say well I did warn about this. it will be interesting to see, the guy will probably never mention this again. He’s probably surprised how much traction it’s got internationally, you know.
But it also goes back to economics and the prevailing Keynesian wisdom. Its the Keynesian-Austrian thing. There isn’t any awareness of Austrian Economics among the vast majority of the public and also these fund managers, these gods who work in various banks and central banks … the majority don’t appreciate that.
There are a few guys who do and those are the guys who have done well for their clients, particularly over the long term and they did well at the height of and during the crisis. They have done slightly less well over recent years where the stock markets have boomed and gold and silver bullion haven’t done as well.
So its interesting …they see the writing on the wall and I suppose for the rest of us, it is better late than never because hopefully he (Mr Spreadbury of Fidelity) has helped a lot of people in the mainstream who would never consider gold and silver and never have realised there were these levels of risks pertaining to bonds and cash.
I think people are led by the nose by these experts so if you get a few of these experts coming out and giving good advice, it’s actually quite a good thing …”
This transcript is the first half of the interview. Listen to the Audio Here
MARKET UPDATE
Today’s AM LBMA Gold Price was USD 1,175.75, EUR 1,048.93 and GBP 744.71 per ounce.
Yesterday’s AM LBMA Gold Price was USD 1,183.35, EUR 1,052.24 and GBP 749.17 per ounce.
Gold fell $7.50 or 0.63 percent yesterday to $1,177.60 an ounce. Silver slid $0.37 or 2.28% percent to $15.83 an ounce.
Gold in Singapore for immediate delivery slipped 0.2 percent to $1,176 an ounce near the end of the day, while gold in Switzerland was again flat.
Gold inched down to a one week low as investors hope a Greek debt deal is on the horizon. The yellow metal is seeing speculative liquidations as stock markets surge again and on renewed speculation that Fed interest rate rise could come this year.
Greece’s creditors have refused Tsipras’ proposal. In addition to that the Greek Prime Minister must sell the new austerity package to his own party, coalition partners and the people of Greece. As they say at the opera, “It isn’t over until the fat lady sings”. The Greek tragedy is set to continue …
Fed Governor Jerome Powell said yesterday that he was prepared to raise interest rates twice this year, once in September and once in December, as long as the economy performs as expected. Fed governors voice their opinion in the press but the decision to raise rates still comes to a vote and members are still divided.
China is awaiting approval from its central bank for a yuan-denominated gold fix “anytime now”, with more details about the scheme that may be revealed at an industry conference this week, noted Reuters. The world’s top gold buyer and top gold producer is seeking to become the leading price-setter for bullion and is asserting itself at a time when the global dollar denominated benchmark, the century old London fix, is being investigated for price manipulation.
In late European trading gold is down 0.02 percent at $1,178.56an ounce. Silver is up 0.43 percent at $15.90 an ounce, and platinum is up 0.37 percent at $1,072.64 an ounce.
