This morning, while walking my weimaraner Banjo around midtown Sacramento, I cranked up my Android and caught a great interview with Felix Zulauf by Jim Puplava for his Financial Sense Newshour. Felix shared his thoughts with Jim on inflation risks, world central bankers, the precious metals, a buying opportunity in uranium, and China.
My notes from the interview:
- Zulauf has a similar view on world monetary flows as Jim Rogers – that the US is exporting inflation, with China opting to import it, because they are reinvesting their surplus into US bonds, rather than allowing the renminbi to rise.
- He thinks the next shock in Europe will come from Italy – perhaps as early as late summer. Has Zulauf been speaking with our astute European bond market correspondent Dr. Evil? 🙂
- Bernanke’s doing essentially “the reverse of what Paul Volcker was doing from 1979-1985”, creating an incentive to get out of US dollars and into real assets, by holding real interest rates negative.
- During the gold standard times, all the gold in the world represented about 5% of all global financial assets. At the last gold peak in 1980, it represented about 3%. Right now – it’s only 0.06% or 0.07%. He sees no bubble in gold yet.
- Longer-term, uranium is a BUY, and the next 2-3 years will be a great time to accumulate uranium shares.
- He agrees with the Faber/Rogers take that whenever asset prices correct (Zulauf is bearish on the 2nd half of this year), the Fed will launch QE3 – “eventually going to QE33 or whatever. And this will end badly of course.”
- My favorite quote (of the interview, and also the month of May): “Bernanke is the first central banker in history, that I can remember, to say ‘I want to make US stock prices go up, and I will do whatever is necessary to do that.’ We are witnessing the biggest financial market manipulation of all time, and it’s lead by a central banker. This is terrible!”
This was a great interview – I could listen to Zulauf all day. Great investors like him, Rogers, Faber, have such a comprehensive grasp of history – recent decades, recent centuries, etc – it’s all top of mind for them, and they can draw intelligent analogies all day with our present situation.
And if you like this interview, be sure to check out our exclusive interview with Jim Rogers – from Singapore!
Special hat tip to Banjo for his endless demand for long walks.