Monday, May 16, 2011
Eric Sprott, the Canadian money manager who in 2008 predicted banking stocks would collapse, says U.S. savers will eventually pull their money out of banks that are carrying too much leverage on their balance sheets.
“House prices keep going down, the number of people under water keeps getting worse,” said Sprott, 66, who is chief executive officer of the Toronto-based firm.
“That leverage is going to work massively against anybody whose lender is in that area. The dominoes are starting to fall.”
Sprott said the “ultimate event” is that savers will take their money out of banks and invest in precious metals such as gold, which he says is now the world’s reserve currency.
This article was posted: Monday, May 16, 2011 at 2:43 am