Eric Sprott Interview By King World News: Must Hear
Submitted by Tyler Durden
King World News presents another great interview, this time with innovative hedge fund manager, and financial skeptic, Eric Sprott, best known recently for bringing an alternative to the GLD and SLV paper domination, with his innovative gold and silver physical ETFs. In the below interview, Sprott shares a wealth of insight into Keynesianism, on the staggering and rising debt load, on the collapse in every single economic metric and the imminent arrival of the double dip (sorry Apple fans, iPad sales are not a leading indicator; at best they serve as a delinquent mortgage tracker), on QE1 and the upcoming QE2. Sprott's view that "nobody has a solution here, nor should they have a solution here: I think we need to rid ourselves of the theory we need to keep adding debt all the time to keep growing." Sprott agrees with the Zero Hedge principle, that when dealing with broken Keynesian economics, you need to shock the system - "you need to hit bottom." As Sprott says: "You need to really shake the system in order for the system to change, and so far there has been absolutely no change in the system." And, of course, Sprott discusses gold, gold manipulation, and paper gold. 30 minutes of must hear observations.
Full interview can be found here.
Highlights from the King World News interview:
On the failure of Keynesian principles:
"One of the studies concluded that whereas we used to get something like 60 cents back on the dollar of government expenditures, today it’s negative 40 cents. So it’s pretty dismal when you think that everyone’s expectation is that this government’s going to bail us out, and as they are trying to bail us out, we’re actually losing ground because at the end of the year you still have the debt.”
On the inevitability of QE2 and on the $10 billion a week debt issuance clip:
“I’m debating whether QE2 is happening while we speak, because the Fed’s balance sheet continues to grow, even though they said they are going to stop buying most instruments at the end of March. But every week it keeps growing by $10 billion. I mean $10 billion a week is half a trillion dollars a year.”
On the economic double dip:
“You know we’ve had to go from obviously greenshoots, to what we’re looking at today is almost like cliff diving. And some of the data points are just so shockingly bad...Consumer confidence numbers...The rate of decline was just awful, the rate of decline was incredible...We have obviously hit the wall.”
On the ongoing collapse in the jobs market:
“Here we haven’t had any net employment increases and now we’re starting a waterfall down. So if we keep losing jobs and their are no policy tools left, how could anyone imagine that you turn it back up again.”
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