Hinde Capital’s Ben Davies: Gold Revaluation to Solve Financial Crisis

February 25, 2013 By 5 Comments

Ben Davies Hinde CapitalIn this MUST LISTEN interview, GoldMoney’s Alasdair Macleod talks to Ben Davies, co-founder and CEO of Hinde Capital. They talk about the recent weakness in the gold price and factors that will propel gold higher.

Ben Davies states that revaluing gold and backing the monetary system with it could be one of the least disruptive ways out of the credit mess. The continuance of debt monetisation on the other hand has the potential to cause a hyperinflationary collapse. Davies is especially pessimistic about Japan, and sees a lot of trouble ahead and talks about Fukushima as a turning point for the country. He also talks about the dire straits the British pound is in.

Davies discusses the recent disappointing performance of gold bullion in light of all the monetary inflation around the globe. However, he points out that the physical market is fairly tight which usually occurs around a price bottom. They also talk about the pressure on the gold mining industry, China’s accumulation of gold, Comex gold data and the possibility of another banking crisis.

Davies’ full interview is below:
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Ben Davies: Stagflation Dead Ahead!

February 21, 2013 By 9 Comments

Ben Davies Hinde CapitalGoldMoney’s Alasdair Macleod has released an interview with Ben Davies of Hinde Capital. They discuss the idea of nominal GDP targeting as a monetary policy strategy for central banks.

Nominal GDP growth is the sum of real GDP growth plus the inflation rate. Davies says that proponents of a nominal GDP targeting — so-called market monetarists — are gaining momentum in central banks and the media. They discuss how depressions are not caused by tight monetary conditions but rather by the preceding excessive expansion of credit. Davies points out that credit and debt are two sides of the same coin, which makes it impossible to clear one without the other.

Davies says that by driving down long term interest rates, central banks are trying to draw investors into equities in order to create a so-called wealth effect. However, he explains that debt levels are simply too high for this method to translate into sustained long-term growth. He foresees stagflation with low growth and excess liquidity.
Davies’ full interview is below:
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