“The unemployment report was awful. There was no net job creation and we’re supposed to be two years into an expansion. Of course this is not an expansion at all, but we’re two years into this, all this stimulus, all this QE, all this money printing, all this deficit spending and we can’t create jobs in this economy.
So that means that the market is expecting more Fed easing through whatever means and if you get more Fed easing, that just means cheapening the US dollar and gold prices will continue to go up.
So what we are seeing today as we are doing this interview is a response to the lousy unemployment report and the fact that the Fed has a two day meeting coming up in September. They (the Fed) didn’t make it two days for nothing, they made it two days so they could wordsmith what I would call some kind of propaganda about what their policy is.
But the shocker might be if they start targeting inflation explicitly and say, ‘Look, don’t worry about the techniques, we’re just going to target inflation, we’re going to do whatever it takes.’ Well, we know what that’s going to do to gold, it’s going to send gold well past $2,000.
“I spoke to (Former Federal Reserve Governor) Randy Crossner, Former Member of the Federal Open Market Committee and he said to me, ‘When the Fed does these meetings they spend about 10% of the time on policy and 90% of the time on communication.’ Now Randy calls it communication or messaging, but I call it propaganda.
How are going to lead expectations? How are we going to manipulate people? How are we going to get people to believe certain things that may not be true about the state of the economy or inflation? It was supposed to be a one day meeting and they extended it to two days. Well, why would you do that, it doesn’t take two days to have a vote? But it could take two days to agree on the words.
The big debate is going to be about whether they want to explicitly target inflation. Now what this is all about, Eric, is trashing the dollar. The dollar price is collapsing and so the dollar price of gold is going up, it’s going way up.”
Rickards also addressed tightness in the physical gold market, “Sure, it’s going to get tighter. I’m seeing a lot of people, they were in GLD, moving to the physical and taking delivery and arranging safe storage.”
This Jim Rickards segment is a must listen as he puts King World News listeners well ahead of the curve in terms of the Fed’s actions and where gold is headed. The KWN interview with Jim Rickards will be available shortly and you can listen to it by CLICKING HERE.
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Eric King
