HARRY DENT - GOLD Will Go Down to $700? No Way!

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Dent is predicted that not only will gold do down to $700, but that it will continue down to settle on $240 by around 2020. 

Harry Dent has just made some dire predictions for gold in an interview with Greg Hunter. 

As none of the other Austrian economists nor precious metals experts who run large companies are saying that, I thought his comments deserved a little attention. 

In a synopsis of the interview, Harry Dent states:  We have the greatest debt bubble in history and we have the greatest debt bubble in history.  It’s the greatest asset bubble in history, including stocks, commodities, real estate and everything. now we are in a fracking bubble.

 

Saudi Arabia is not reducing their production, and they are squeezing out the frackers. So it’s a good long term move by the Saudis , but they could trigger a world financial crisis. 

What’s happened is because of demographic trends, which we predicted years ago, trends in developed countries are set to slow.  It will be aging baby boomers spending less money, very simple to see.  Commodities cycles peak every 30 years. I think it’s a trigger for a global crisis. 

He says that commodities like gold are in a bubble. And that we are going to see a major crisis over the next 2 years specifically.

Greg Hunter: What about the gold price going higher, like most of my other guests say?

I debated all these people including Peter Schiff, but they are just wrong. When debt de-leverages, dollars and debt, money is destroyed. Deflation is good for the dollar, gold went down and the dollar went up. The dollar is the safe haven. When we get in trouble commodities goes down and the dollar goes up. 

You should not have your money in a bank, but with an independent brokerage like Scottrade or Ameritrade that does not have derivatives. But if we see stocks break down more than 20% then we are going into the next major crash, and you will have about a year to do something with your money. 

Cash is the place to be. 

Greg Hunter: Does gold work good in a deflationary environment?

Gold is an inflation hedge. But not the place to be when you have deflation. I think gold is going to go down to $700 and will settle out at $240. 

Harry Dent: Around $700 per ounce is a certainty in gold by 2015 to 2016 and $250 per ounce is a possibility well down the line by 2020-2023. Governments are fighting deflation. If government stimulus fails, we will have deflation, not inflation. 

Our point was proven when the US escalated with QE3 and QE3 Forever, then Japan went off the reservation with three times its stimulus, yet inflation dropped. Holy smokes! That wasn’t supposed to happen. It was proof they were actually fighting deflation and losing the war.

But there will be a drop to at least $700 per ounce in the next few years, and keep declining. 
So gold is not what people thought it was.
 

Harry Dent: We will get mild inflation in the future only like the seasons, like in about 10 years. Maybe in 2030. It’s not in the cards for decades. 

End of interview
 

Sometimes you wonder if a person actually thinks through their own prediction before they say it or write it down (Dent). Sure the price of paper gold can go to whatever the bankers want, but for physical gold to drop to $700 or even $250 within the next 5-6 years just sounds bizarre. Does he really think the economy is getting better? 

That unfunded liabilities all of a sudden have been funded? That the national debt is now being paid off and will be paid off by 2020? That true unemployment is going to improve? That states, counties, cities have fixed their budget woes? That those on EBT are actually going to get jobs? That Obamacare is actually going to stimulate the economy? That the PIGS are on the right track and have fixed their problems? The list goes on.

China is buying something like 83% of yearly production of physical gold. At $700, much less $250, who is going to provide the physical gold for that hunger? The answer, no one.

He seems to think that the US dollar will be a safe haven when everything goes to pot. Not sure if I buy that….

In an article on USA Gold by by Michael J. Kosareson, Black Swans, Yellow Gold, “Gold as a Deflation Hedge. … There is MUCH More to this story…Go here for the rest of the story….