Mike Gleason: It is my privilege now to welcome back, the one and the only, Gerald Celente, publisher of the renowned Trends Journal. Mr. Celente is a frequent guest here on the Money Metals Podcast and is perhaps the most well-known trends forecaster in the world, and it's always a real joy to have him on. Gerald, thanks for the time again today and welcome back.
Gerald Celente: Yeah, thanks for having me on, Mike.
Mike Gleason: Here we are again, volatility is creeping back into the stock market. The trade dispute with China has been a big driver in the markets over the past year and a half. It's currently weighing on the equity markets again. There's lots of talk about the inversion in bond yields signaling that a recession is on the way. What are you expecting in the financial markets between now and year end? Are we going to have a bloody fourth quarter like we did last year, Gerald?
Gerald Celente: It's hard to tell, but what we're saying at the Trends Journal is that the markets have peaked, and the downward pressure is great. You mentioned the trade war, the markets hit new highs this year. They've been hitting new highs since Trump got elected. We were the first people, by the way, two weeks after he got elected in 2016, to call the Trump rally. And I was the first to say it was over. And I believe it's over now. And so it could crash. There's a lot of wildcards out there and there's no wilder card than the Trump card. But I make this point because this trade war talk has been going on continually. It's not a trade war that's slowing down the global economy. It's the monetary methadone that the Federal Reserve and the other central banksters injected into the system, just to enrich the 1%. The facts are there.
When you look at the sanctions that Trump has put on China, the last report that I saw was that it effected 0.6% of China's GDP. That's nothing. Take a look what's going on in India. Oh yeah, their NIFTY 50, their equity market, it's down over 10%. Oh, I wonder why? It's not a trade war with them. They're not doing a lot of trade with China. No, the global economy is slowing down. Same thing with Argentina. How about Brazil? They keep using this excuse of the trade war with China, when it's much bigger than that. It's a global slow down. The monetary methadone only keeps the bull running, the addicted bull running for so long, so it's ready to crash. But again, what I learned over the years after it crashes, they come up with a new drug, and they artificially pump it up again. Will they have enough to do it this time, is the question.
Mike Gleason: Expanding the point here. We've seen volatility come and go in the equity markets, but there are some real differences which make us wonder if this time it's different. Bond yields are inverted, which is an indication that investors want to park some capital indefinitely in longer term bonds, and they want that badly enough that they're willing to accept returns even lower than for short term bonds. And precious metals prices are starting to move. Both are a sign that investors are looking for safety. Are the wheels getting ready to come off the equity markets for real this time?
Gerald Celente: Yes, they're getting ready, absolutely. But again, they're going to do everything they can to pump it up. You're looking at the United States, they only could lower interest rates 2%. When the last recession hit, the interest rates could come down 5.5%. You go to Europe, they're in negative rates already, minus 0.4. They're going to bring it down to minus 0.5, and dump another $60 billion a month into corporate and government bond buybacks. So, going back to the inverted yield curve, I mean who in their right mind would buy a 30 year bond, a German bond, and get less back in 30 years than what you bought it for? And not a lot of people. But yes, a lot of people, the German bond, they had to buy $2 billion worth when they launched that last week, and there was 16 to $17 trillion in negative yield global bonds now that had been sold.
So, that's why people are going into gold. They are looking for the safe haven asset and gold is the ultimate one. And just for the record, I call this identically on the point where gold was going to go for the last six years. I said it had a break over the $1,450 mark for it to gain strength. And on June 6th, we sent a Trend Alert out to our subscribers, when gold was $200 cheaper than it is now, $1,332 an ounce. And the headline of the Trend Alert was the Gold Bull Run. Gold which solidified over the $1,325 mark, and our next breakout from that was $1,385. It flew past that and flew past $1,450, so the downside risk we see now for gold is at the very worst about $1,390.
Mike Gleason: Yeah, stealing my thunder, I was actually about to lay all that out. We spoke last in May, and you said the same thing that you've been saying for the last several years, $1,385, we need to take that out. Then we go to $1,450, and then once we get $1,450 taken out, we make a runs towards $2,000. Are you still sticking with that, and thinking that we're going to see gold up towards that $2,000 level at some point?
Gerald Celente: Absolutely, absolutely. And you can see the strength of it. And even when the markets go up, gold isn't going down much. And again, there will be something to bring it down. It always is, whether it's real or manipulated. Just like the markets for example. You go back to the night before Christmas, and Dow is having its worst December since the Great Depression, and the worst two weeks since the panic of '08. And all of a sudden, our Treasury Secretary gets on the phone with six banksters, Mnuchin calls up, and when the markets reopened on the day after Christmas, all of a sudden, the next two days the markets are up over a thousand points. You think it's the Plunge Protection Team? Go back a few weeks ago. Same thing happened. Dow down 800 points, Trump gets on the phone, calls the banksters, next day up, up goes to the market. So, when I talk about where's gold going, there's going to be a lot of pressure from the banksters to keep gold prices low. But again, on the other hand, the central banksters also bought more gold in 2018 than they have in 50 years.
Mike Gleason: Well finally, Gerald, as we begin to wrap up, give us any final thoughts on anything that we may not have touched on, on either the financial front or in the geopolitical realm. Give us a sense of some of the stories or the trends you're going to be following most closely as we head into this final stretch of the year?
Gerald Celente: Well, what's going on, very important to watch is what's going on in Hong Kong, and what's going on with India, and now ripping up the 1947 agreement and saying that Kashmir is theirs, they have no autonomy. And now you have two nuclear states, Pakistan and India in conflict. Because Pakistan says, "No, no, Kashmir is ours," or whatever they keep fighting about and have been fighting about. And some 50,000 people were killed over the last 10 years over a dispute like that.
When all else fails, they take you to war. And right now the Indian economy's failing. The NIFTY 50 is down over 10% since Modi got reelected, and he won by a landslide. The people's minds are off the issues. You look at car sales, you look at their GDP, worst GDP in five years, in the first quarter. Car sales plummeting. (It) has nothing to do again with trade wars, the whole thing is going down.
When all else fails, they take you to war. Same thing with Israel. Netanyahu won the election. Cannot put together a coalition government because he wants part of the coalition government to write in a statement that he will not be able to be prosecuted on charges he's being brought up on. So, now what's happening? In the last few days, boom, a drone attack in Lebanon. Airstrikes, missile strikes in Iraq, where Iranian troops were, and in Syria.
Again, we have to watch these areas. They're very important because if it explodes in the Middle East against Iran, it's the beginning of World War III. You're going to see oil prices skyrocket to over a hundred dollars a barrel, that'll crash economies and it will crash equity markets. And by the way, the reason that Trump did not retaliate against Iran when they shot down that very sophisticated, $100 million, $200 million drone, was because it would have been Pearl Harbor in the Straits of Hormuz. Iran is not Libya. They're not Syria, they're not Iraq. They're not Afghanistan. They're the Persians. They're not going anywhere. And they have the sophistication to fight back.
So, if war breaks out against any of those countries, against Iran, that's a big one to watch. We're urging people to stay tuned to follow the trends that are going to make a big difference, particularly going into the greatest depression.
Mike Gleason: Well excellent, we'll leave it there.
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