Tice says precious metals to soar as a result of Fed’s ceaseless devaluation of dollar
Paul Joseph Watson
Wednesday, October 1, 2008
Billion dollar fund manager David Tice says that the Federal Reserve’s ceaseless printing of dollars could cause gold to surge past $2,000 an ounce, while the Dow could fall below 5,000.
Tice, who manages the $1.1 billion Prudent Bear Mutual Funds from the Virgin Islands, told Bloomberg TV anchor Carol Massar yesterday that the time scale of his forecast will be determined by how quickly foreigners lose confidence in the dollar.
“Bernanke has essentially been known as, you know, possessing the printing press, etc. and, you know, it depends a lot on foreigners as far as how quickly they lose confidence in the dollar and what happens throughout the world as well,” Tice said.
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“Our currency’s going to be diminished even though gold has been very, very volatile – down $250 just over a few months,” he added. “I think it’s going to head to $2,000 eventually and it will protect you. And I do think less equity investments make sense,” said Tice, advising that owning precious metals was a way of reducing equity exposure.
Warning that the pain was far from over, Tice said, “We think that we’re going to have to pay for the excesses of really the last five to 10 years of this excessive credit growth with a dramatic slowdown in the economy, dramatically lower markets. We’re still above 10,000. We think we’re going to, you know, fall below 5- or- 6,000 on the Dow and we think we’re going to have to readjust the U.S. economy towards less consumption – where we pay for goods with goods.”
Despite a recent SEC ban on the short selling of nearly 800 financial stocks, Tice advised that traders should still short the market, arguing that it’s a legitimate trading practice.
Watch the clip below.
This article was posted: Wednesday, October 1, 2008 at 3:27 am