-- Posted Sunday, 16 October 2011 | | Disqus

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Okay, you’re back with GoldSeek.com Radio and today’s Gold Nugget Segment.  Wall Street veteran, Peter Grandich.

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Chris Waltzek:         Today’s featured guest has been a market commentator for 30 years.  Peter Grandich correctly forecasted not only the ’87 market crash, but also the dot.com bust.  Peter Grandich is a strong supporter of the gold and silver market and is editor of The Grandich Newsletter.  Welcome, Peter.

Peter Grandich:        Always a pleasure to be here.  Thank you for having me.

Chris Waltzek:         Let’s begin our discussion with your new book titled Confessions of a Wall Street Whiz Kid.  In ’82, you found success in one of your first market operations.  You turned $7,000.00 into $100,000.00, but it wasn’t long before Mr. Market foreclosed on those profits thanks to a penny stock gone wrong.  Peter, you know, the government didn’t offer you a bailout.  You didn’t erect a pop tent on Wall Street.  What did you learn from this?  What did experience teach you?

Peter Grandich:        Well, you know, as you noted, and got a new review today on The National Post in Canada, they were most gracious about the book, it was really an open book to my life.  I, you know, didn’t even have any formal education.  I entered a business where, you know, it’s a Wharton School and Harvard types, and I was a strictly blue collar person.  And so, I had to, basically, get everything myself.  There was nothing handed to me.  And I think that describes previous generations, our parents and grandparents.  In the last generation, people have grown accustomed – and I don’t know whose fault it is, I don’t think we have to argue about that, but they’ve grown accustomed to the government doing more and more, the expectation that the government should do more and more for them.  And there would be some that would argue, “Well, the government does that in order to get people hooked on them so they can do or not do what they want to people.”  But, one of the things, I would say, through all of the experience has been is that hard work and staying focused, you can make something of yourself.  You know, you hear that cliché all the time that America is that place.  But, it really is.  Have some opportunities been made not available?  Probably.  But, there’s been new opportunities made in other areas. 

And I think when you look at – and I created some controversy on my blog by posting just five thoughts about this thing that’s been happening; and, of course, people read into it and they read it wrong and they write to you and tell you why.  But, the theme of what I posted was is that and, perhaps, the first one I noted is, you can’t legislate prosperity.  You can’t.  I mean, that’s what socialism and communism tried.  It forced wealth to be spread and if it worked that way, communism would still be a great thing; but, anywhere we’ve seen it, it’s basically failed.  Now, capitalism had a lot of bad things but, for me, anyway, the choice between the three is simple – capitalism.  It offers an opportunity like me, someone that didn’t finish school, went and played with the big boys, so to speak, and was able to make somewhat of a career out of it.  So, I would answer to you and my long winded response is, I still believe depend more on ourselves than government certainly, and with hard work.  And, you know, I’d be unfair if I didn’t note to you that a big part of my belief is a spiritual one and that is that – and I think that’s what also led this country for at least 200 of its 250 years – a deep-rooted, Judeo-Christian thought and morals and actions, both on the government and its people, which, in the last several decades, has dissipated a lot and I think that’s also why we have some of the problems that our parents and grandparents didn’t have.

Chris Waltzek:         This backlash we’re beginning to see certainly has some merits with regard to the banksters and these excessive payouts that we’ve seen there as the government misdirected funds, clearly funneling them to the wrong folks.  But, you know, at the end of the day, I agree with you.  You know, maybe we should take our focus off that for a moment and recognize that, yes, capitalism is flawed.  Its problems are legion, but it is the best of all evils when we look at socialism, communism, any other system, even fascism.  Capitalism is the one that does allow the immigrant to come to the United States, work two or three jobs, save about 70 percent of their income, invest wisely, live frugally, and make the next generation have a far better experience, and maybe even capture the American dream.  And I believe that’s still alive.  It may be on life support right now.

Peter Grandich:        I wanna make one point, which I think people who just read my post and haven’t read or listened to all my interviews would have taken better, at least the small minority that responded negative to my post, for one thing, I would drive these folks if the protest was just about Wall Street.  Anybody who knows me, if you read my book, all my writings, I can’t stand Wall Street.  I have said this and I’ll say it again in your interview.  What Wall Street did a few years ago was equal to as if they sold hundreds of billions of dollars of automobiles to people all around the world knowing full well they were faulty.  Most of ‘em are gonna crash and most of the people driving ‘em were gonna die; and then, they bought life insurance on those drivers to collect from them when they do die in the vehicle that they sold ‘em.  And that’s what the mortgage scam was.  At the end of the day, that’s what it was.  No one’s gone to jail and that is, perhaps, the most horrific act of all, in my opinion, that Wall Street has done.  So, I’m not defending Wall Street and I’ve seen people taking it that way.  What I was trying to speak about, and what I am defending is, is that you have to earn things.  You know, I said it in another thing, if you take from one, well, you know, if the government’s giving something, it’s taking it from somebody else.  They don’t really produce anything.

                             And one of the other things is with now one out of two people on some sort of government program in the U. S., some of ‘em are justifiable, some aren’t, but one out of two, there’s an old saying that I used in my post.  And I said, “If half the people figure they can get stuff without working, the other half that are working, when they see that those other people are getting it without having to do, they’re gonna want the same thing – stop working – and that’s the beginning of the end of any nation.”  And that’s the biggest fear that I have in all of this. 

                             Now, the good news in all of this, if you wanna consider it good new is, and someone would argue, and I think it would be fair to say, that  most of the people supporting this group would left minded thinking and, of course, that, to some, is like me, who’s a conservative, is the opposite.  But, it’s good that that’s happening in a sense that people are finally speaking out.  I mean, that’s what the tea party’s about.  I’ve been a great defender of the tea party, although not a card carrying member, because they are just people who grew tired of the regular party atmosphere whether it was Democrat/Republican, felt that it’s a failed process and felt that new formations of groups needed to be done.  And I find it interesting in our left-leaning media that they were attacked from day one and, really, they were just an alternative party forming.  Yet, the people, which is a much smaller group, much, much smaller group, and certainly more activists and more vocal, the so-called Wall Street group, is getting, you know, basically major support in the media.

                             You know, I watched Amy Suze the other night and she talked about it as if it was a million people march when it was just a few hundred people marching.  But, it’s good in the sense that people are addressing their issues.  There’s no question that there is an elite – elitist mentality, not only on Wall Street, but through America.  And let me just say one more thing because I do appreciate this time you give me and when you interview me, and I wanna make this crystal clear to  my followers and yours as well.  I don’t support getting rich.  Anybody that reads my current book will realize that not only have I changed my life that way, I believe spiritually and by what I believe is a manuscript for life, the Bible, it calls us to those who are blessing to even do more to help those that are less fortunate.  And that’s the failure of the elite.  In all of this, and that’s why people are rebelling against them, they have not done the right thing with their tremendous blessings and have basically foregoed their fellow man and that’s the rising that you’re seeing.  But, let me make this other point to you.  I deal with professional athletes in another business, some of them very elite, that run in that world.  It’s hard for us to imagine, but those folks live in another world.  They have no idea, Chris, of our way of life.  They don’t know what it is to take public transportation or even a commercial flight, or shop at a store.  You know, they literally live in a world that is totally different.  And because of that – and I’m not giving them an excuse – they have no real idea of what these people and what the majority of people feel.  And that’s just the shame of it because I do think if some were at least made aware of it, to a point that someone could sit down and get their ear for a few minutes, they would be better off; and I’ve witnessed that with athletes that I’ve been able to share with, share my story with, and see the change in them, how they look at people, and they do so much more charitable and other work once they recognize that.

Chris Waltzek:         Once you unleash unsound money, you have bubbles everywhere and in the stock markets, real estate, credit.  Do you think the bull is still running here in gold and silver?

Peter Grandich:        There is no question.  And while, even some of my dear colleagues faulted in the most recent correction and caved into the constant perma bear pressures of saying the gold bull market was over, I have not weathered.  I’ve said that this was just another healthy correction in the mother of all global markets.  And, you know, I mean, if you want to talk a little technically, you wait ‘til it gets above $1,710.00.  After that, I think, technically, you have an all clear signal and it’s on to new highs.  But, technically or not, I think the mother of all bull market remains.  As I’ve said in recent days, it’s not a question of if, but when we get to $ 2,000.00 in print and the only thing I want to remind, certainly my readers and, hopefully, your listeners will care as well, is that when we do hit $2,000.00, and we do get those people again saying those same things, just remember this is the umpteenth time that they’re doing it.  And, perhaps, the most thing that ironic that bothers me the most in all of this is that certain of these perma bears who’ve been so wrong for so long, that the same media group interviews them and never questions them about their past mistakes, but then calls upon the handful of us so-called [Audio Skip] gold bugs to have to answer every day gold isn’t trading at its all time high. 

I mean, if you wanna talk about the most stealth bull market in the history of mankind, at least that I’ve studied, where you’ve seen almost, you know, an 800 percent gain and, still, the vast majority of people had little or not exposure to it, it’s the gold and silver market.  So, how anybody can call that a bubble market, and that, you know, it’s so overdone because everybody’s had it and they gotta get in and there no one else to come in, it’s so wrong.  So, I guess the long winded answer, again, that I seem to be doing to you today, is that the bull market remains fully intact.  We just had another correction, which, believe it or not, was extremely healthy.  And now, we were at $1,600.00 and change and people didn’t like gold and we’re at silver at $30.00 and $32.00 and they were saying it.  So, this is good.  This is the type of stuff that happens in classic, secular, measurable markets, and I love it.

Chris Waltzek:         No, I agree with you.  If you loved silver before, after a 50 percent haircut, talk about a fire sale, I think that’s an incredible opportunity.  I’d also like to discuss the fundamentals of this precious metals bull market for a moment.  For quite some time, people have pointed out that if you multiply the inflation since the 1980’s peak in the previous bull market in gold and silver, that’s about $2.75 for every dollar.  So, multiply that times $8.50, the peak on gold and $50.00 on silver, then you come to, roughly, $2,400.00 gold forecast and about a $140.00 on silver.  But, you know, I think that that might even be a bit myopic here, Peter, and I’d like your thoughts on this.  There is two to three times more people now on the earth than there was back then.  At least half of those people now suddenly have access to gold and silver, particularly China, Asia and Russia, and we’re seeing two to three times more money supply in the world.  That sounds like a recipe for prices that very few people are expecting at this time.

Peter Grandich:        Well, I just think you bang on in two points.  I mean, think about it.  In that first one, you very rarely  have people point out, so it’s especially well in your view, and that is, you know, people say, “Well, in 1980, it hit this.”  Well, you know what?  There’s that many more people in the world who have an opportunity to purchase relatively.  Only the difference between  now and then was because, you know, all the gold that’s mined is still ____, is only the gold since 1980, and we all know how with all the gold produced all the way back to day one, it’s only in, you know, X amount of feet high, etc, etc.  I think that’s bullish, but the thing that has kept me bullish more than anything has been three things.  And I know I probably said it before with you and I’ve said it constantly, (A) one of the things that used to hold – actually, the first two things that used to hold the market down – that was large scale central bank sales and large scale forward selling by producers.  Neither has happened for years.  Neither is happening now to any great length.  And none is expected anytime soon.  And then the third is to your second point.  The mere amount of money that’s been created in the world, which is constantly the way they’re going, which they’re gonna do everything to do, and now most governments are heading, both in Europe and the U. S., creating more money; and, throw in the fact that where world growth is really happening, where people are really making money, they’re buying gold, just like Americans used to put money in IRAs.  I mean, people send me this.  “Oh, this is the top.  Look, there’s 2,000 gold machines they put out in China for people to buy gold.  That’s clearly gotta be the top.”  No, that’s the same as America when they created IRAs and people had money taken out of their employment and it was put into IRAs and 401Ks and they bought stocks and bonds and that’s what helped the market go.  China’s decided, “You know what?  We need our people to get hard assets.  We don’t want it to flow into bonds of China or companies of China.  We want them to buy physical gold.  We’re gonna make all the availability.”  So, they’re buying gold the same way Americans and Canadians have put money into their retirement and savings program.  And that’s just continuing.

                             So, other than correction, if you look at the corrections in the last eight years, we didn’t have a bunch of little ones; we just have, every couple of years, serious short term ones that cause a little agitator, but basically take, instead of the 6 to 12 months to wash out the market, it’s done in 6 to 12 weeks and that’s what we’ve had again.  So, I remain staunchly bullish and, like I said, if you really want to wait and be as conservative as possible, wait ‘til gold class two closes above $1,710.00 and then you’ll absolutely have an all clear signal and be moving to what I think will be new all time highs, of which $2,000.00 plus is clearly a potential in the next one to three months.

Chris Waltzek:         Well, that sounds like excellent advice to me.  And for our listeners, Peter, who’d like to find out more about The Grandich Letter, as well as your new book, could you please provide contact information?

Peter Grandich:        Sure.  Grandich – G-R-A-N-D-I-C-H.com.  You can see our blog and at the top, there’s a link that describes the book and you can register on an email list to be notified when it’s for sale.

Chris Waltzek:         Well, sir, it’s always a pleasure.

Peter Grandich:        Thank you very much.

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-- Posted Sunday, 16 October 2011 | Digg This Article

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