Silver Market Q&A: Dr. Michael Berry, Morning Notes
Silver Investing News had the opportunity for our own short Q&A session with Dr. Michael Berry, publisher of Morning Notes, who will be speaking at the world-renowned Silver Summit Investment Conference and will host a “no holds barred” Q&A session following his presentation.
By Melissa Pistilli—Exclusive to Silver Investing NewsThe price of silver has experienced strong downward pressure over the past few weeks as the value added by safe haven sentiment responsible for much of 2011's price gains has been eroded by the prospect of another worldwide recession. As is commonly the case with the notoriously volatile silver market, silver price action “indicates that silver is facing more selling pressure relative to gold,” said Deutsche Bank in a recent research note. “Moreover the widening in the gold and silver risk reversals in the one-month to three-month tenor would suggest that the correction in gold is more likely to be temporary than that of silver.” The current climate of global economic uncertainty hanging over the markets will no doubt make for an interesting Silver Summit Investment Conference later this month, October 20-21 in Spokane, Washington. Dr. Michael Berry, publisher of Morning Notes, will be speaking at the world-renowned resource investment conference and will host a “no holds barred” Q&A session following his presentation. Dr. Berry's decades of experience as a financial analyst, university professor and investment manager have made him a unique and well-qualified expert on the financial and resource markets. Silver Investing News had the opportunity for our own short Q&A session with Dr. Berry. Silver Investing News: What's the likelihood that the Fed will initiate a third round of quantitative easing? What would be the impact initially and long-term for silver prices?Dr. Michael Berry: I think there is a very high likelihood of either a QE3 or another form of direct intervention, such as some sort of money expansion policy by the Fed. I do not think the Fed will reduce the interest—25 basis points—it is paying the banks for investing their $1.6 trillion in money supply back with the Fed. This is a remote possibility. In recent days the likelihood of QE3 has increased because the specter of deflation has increased to a significant degree. The Fed fears deflation above and beyond everything else. Therefore, inflation and a devalued currency is the preferred way out of the problem of stagnant economic growth and high unemployment. Obviously, the more the Fed attempts to inflate, the more commodities — which have been battered recently — will appreciate; in this case, both silver and gold should appreciate.