Transcript of The Precious Metals Market Report with Franklin Sanders and Dr. Edwin Vieira is now available to Subscribers!
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From the transcript:
Catherine: As you know, the precious metals markets have been far more than
interesting, so we have plenty to cover before Dr Vieira joins us. So Franklin, are you with
us?
Franklin: I’m right here.
Catherine: Okay – so bring us up on the markets. What’s been going on?
Franklin: Okay. Well, let me go back and start addressing the question, “Is the bull market over?” To do that, there’s a chart of the 30-year bond yield that I would like to point out. It says TYX up on the upper right-hand corner. It’s the yield on the 30-year bond. And I think the trend lines are on that, and you’ll see that this zero-interest rate policy that Bernanke has been pursuing so long appears to be breaking down, because the yield, remember, moves the opposite way of bond prices. When bond yields go up, bond prices go down.
And by keeping interest rates low, he has effectively created a bubble in bonds. And when all that money comes roaring out of bonds, there’s going to be a problem for the dollar. So one of the things that I’d like to point out is that the underlying conditions in the interest rates and what that implies for U.S. government bonds and for the dollar is not good. The interest rates have already broken out to the upside. So the thing that Bernanke probably wakes up at night sweating bullets about is the idea that he will lose control of the bond market.