HardAssetsInvestor

Mike Norman, Hard Assets Investor (Norman): Hi everybody, and welcome to HardAssetsInvestor.com. I’m Mike Norman, your host. Well, everybody has heard the name Doug Casey, the perma-bear. We don’t have Mr. Casey here today, but we do have Louis James, who works at Casey Research. He’s a senior metals analyst. Louis, thank you very much for coming on the show.

Louis James, senior metal analyst, Casey Research (James): Nice to be here.

Norman: I appreciate it. Now, I mentioned Doug Casey; he’s a well-known guy, wrote several books. Really, he mostly talks about Depression and Armageddon and very scary things. I think he has a new outlook right now, one calling for the Greater Depression. Is that right?

James: There’s not a new book out yet, but yes, that's the outlook right now, the Greater Depression.

Norman: So we had the Great Depression back in the 1930s. This is going to be, according to him, the Greater Depression?

James: The financial apocalypse now.

Norman: That does not sound good. Based on what? Granted, things are not so great right now, but why is he forecasting such a cataclysmic scenario?

James: The short version is, all the mega-trends that he likes to follow — demographics, economic trends, political trends, his “guru sense,” if you will — all come together and point in one direction. He believes that government policy over the last decades has really just kicked the can down the line. And he called for trouble in the 1980s. And it’s been put off. And now it seems to him that that’s at the end of the rope.

Norman: What kind of policy? Are you talking about basically the debt, the spending . . . ?

James: Debt, spending, money creation. I know we can disagree a little bit about what exactly constitutes that: the printing press, Bernanke and his helicopters and so on, all these things, the trouble in Europe, all converging, to believe that everything is fine, to believe that this recovery is real, that Obama has saved us, everything is going to be hunky-dory . . .

Norman: Well, I don’t think everybody believes that. I think there are many skeptics. And I think such things as the unemployment rate, or the sluggish nature of the economy would belie any claim that the economy has been saved. I think far from it.

James: So that’s bullish for both. If that’s the good news, that it’s a sluggish recovery, you’ve got Europe disintegrating — you’ve got to believe that the Germans are going to be happy to pay for France’s new socialism. That’s not a bet I want to take.

You’ve got to believe that the Chinese and the Indians are going to buy more of their own product — that’s not a bet I want to take. There’s a lot of bets that I really wouldn’t want to take to believe that we’re back to the boom years, things are going up, and that gold . . . what was it, a $1,900 peak last year, that was it. And it’s down here . . .