by JT Long:
"The Gold Report: Last February, you forecast that stocks would rebound in 2012. What signs indicate that's about to happen?
"Charles Oliver: I had expected that the money from the European version of quantitative easing would start to get into circulation and, with the continuing debasement of currencies, be very positive for gold and other asset classes. However, I miscalculated how weak the banks of Europe actually are; most have very weak balance sheets. Indeed, they took most of that money to try and prop themselves up and keep afloat.
Having said that, I maintain my long-term thesis, which is that the governments of Europe are going to continue to print money. The things that are going on in Europe, China and the U.S. lead me to believe that there is going to be significant printing down the road, which ultimately will lead to higher gold and silver prices.
"TGR: This liquidity being forced into the system will drive gold prices higher?
"CO: Yes, absolutely. Banks in Spain, specifically Bankia, are in need of funding and injections of equity. The central banks of Europe are already running very large deficits and don't have any money available for this. The only reasonable conclusion is for them to turn to the printing press-whether it be directly printing or some other quasi form of printing, such as a long-term repo operation-to ultimately do a significant amount of the funding. ..."