Jim Sinclair: Gold Market of the 70s Was a Dress Rehearsal

Jim Sinclair is telling you something that needs to be heard. He has been delivering this message for a decade in terms of a time that will come. The time has come and he now speaks in terms of the here and now. Take note and access the ramifications of denial or delay. The time has come to protect yourself. 

QE cannot be reversed. QE cannot be discontinued. QE is the expansion of base monetary supply, not credit money supply. Base money supply defines the value of a currency. Credit money supply is more about liquidity. Perpetual expansion of supply that defines value must result in the death of a currency. It is a law and is not subject to the will of politicians or bankers. Gold is the anti-dollar.

Not all that is golden is gold. Paper gold, or otherwise commitments to deliver physical gold or its derivative, are not gold. Gold is physical gold in your possession. Nothing else will do. Anything else is dollars masquerading as gold. There are many more of these claims to physical ounces of gold than there are physical ounces of gold. These claims will end up the same way as the claims that disappeared at MF Global. They will simply “evaporate.” This concept that “paper gold” will evaporate and physical gold will remain and will acquire the value held in paper gold is called Freegold. Learn about it at the FOFOA Blog. While you are learning, get some physical gold in hand. Time is short. A little goes a very long way. 

Jim Sinclair:

Dear Friends,

Please keep focused on the fact that the gold market of the 70s was simply a dress rehearsal. What is taking place right now is the real thing.

The supposed “Curse of 13” is behind you in the break from $1900 to close to $1500.

The reaction was stopped because the need and use for QE to infinity is real and present in time. There is no other tool in the lender of last resort to the entire Western World’s toolbox other than QE which can be applied to create the degree of liquidity required to prevent a global implosion. No other tool can create infinite liquidity in a flash. There is no speculating on what might happen in the future. It has happened now.

Few are looking at dollar utilization falling in international contracting and settlement. That is a key element of 2012. The US dollar has enjoyed demand from settlement and contracting which it is now losing daily. Gold is gaining utilization as a competitive currency.

Enormous utilization was the blessing the dollar had when it was the reserve currency of choice. Utilization and settlement is falling fast as the dollar now is the reserve currency by default.

Very few have ever tried to quantify this serendipitous demand for the dollar. Allow me to assure you dollar utilization for these purposes is huge and extremely important to dollar valuation.

2012 is the year the dollar falls as a result of a significant drop in dollar contract and settlement utilization. Imagine the demand for gold as the dollar closes below the antiquated measure of .7200 on the redundant USDX. When this occurs you will be looking back at $2111 from higher levels.

Please keep in mind that this is not a dress rehearsal but rather the real thing. There is no practical means to handle the problems at hand. We are at the dead end of the road the can has been kicked down.

Volatility in gold is going to go wild so just keep your head down and hold your insurance close to your chest. The cheapest thing gold is the gold share with the most ounces versus its price.

Silver is a game, but one hell of a game. Another try by silver at $50 looks imminent.

Regards,
Jim

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