With the world's situation becoming increasingly unstable, today one of the top money managers in the world spoke with King World News about China's plans to dominate the world and crush the United States. He issued an ominous warning for the West and particulary the United States.
Stephen Leeb: “When I look around the world at the geopolitical situation, U.S. economy, global markets, the big picture just makes me cringe to be very honest with you. Also, Goldman Sachs said we would see a massive drop in gold but gold is hanging in there, Eric….
“The fact that the gold market is remaining firm has to be respected. Gold has been forming a massive base. Every time gold dips below $1,200, physical buyers step in and dominate the paper manipulators.
The other things that is interesting is that the oil market. Oil demand is still pretty strong but the price of oil has tanked 55 percent. The Saudis have created this collapse in the oil price. So who are the winners? It’s not the U.S. because oil production is now a very big deal in this economy.
The fracking industry employs so many people and its tentacles spread everywhere. As an example, rails have to bring sand to the fracking wells. Fracking also impacts a number of industries such as steel. Yes, the consumer is saving money, but the big picture for the fracking industry is disastrous, and this will negatively affect the employment situation as layoffs take place and the fracking boom comes to an end.
The biggest beneficiary of the collapse in oil prices is China. This is a massive tax cut for China. The Chinese are taking advantage of these low prices to stockpile as much crude oil as they possibly can. Most of Saudi Arabia’s goods come from China and that flow of Chinese goods continues to increase. China now has an amazingly strong relationship with Saudi Arabia. China is building an enormous power base along the Silk Road. This is giving China a powerful tailwind.
When you contrast what the Chinese are doing to what is happening in the U.S., we basically don’t create anything in this country anymore. The U.S. isn’t even putting money into its infrastructure. Also, very soon the Chinese will start trading their own oil contracts in yuan. China also continues to accumulate large amounts of gold.
So you are going to see the East form a new currency, led by China and Russia, that will include a basket of other currencies backed by gold. Eric, that new currency will bury the dollar. At that point it will be lights out for the United States — inflation will skyrocket and gold will trade to $10,000.
This is why gold is completing this massive base. China has accelerated its gold buying program in the last couple of years. But China has also accelerated its program from an economic and a military sense. The Chinese are also engaging relations with Japan. This is all part of China’s move toward world hegemony and their stock market boom illustrates this.
The Chinese are soon going to have their talons deeply into well over 50 percent of the global economy and 50 percent of the world’s populated areas. And the Chinese will have enough gold to cement their plan for global domination. The next couple of years will be the most important since the Industrial Revolution, as the balance of power shifts dramatically from West to East.
So I urge everybody out there to use this period of basing to accumulate as much gold and silver as possible. I fear the only way people in the West will come out of the next decade financially intact is if people have enough gold in their portfolios, because much of the rest of the paper financial instruments are going to go up in flames in the coming decade.”
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