Now is the time to buy gold: Bianco

Financial analyst Jim Bianco discusses the buying and selling of gold on Bloomberg TV (video below).

Bianco said three weeks ago ETFs owned 84 Moz of gold and today they own 79 Moz. The price hasn't gone down even though 4.5 to 5 Moz have been sold off.

"There’s a huge underlying demand for gold in the last couple of weeks," he said, adding that what's been sold in just a few weeks is the the equivalent of about 7% or 8% of world production.

"That's bullish," Bianco said, "You can find a buyer for all that gold."

When asked who's buying it, he said, "Everybody else."

Bianco said ETFs are usually bought by retail investors and when the price broke $1600 they started to run for the exits — everybody else has absorbed their selling.

"When they start to wane on their selling – and they’ve already sold a record amount for the 10 year history in ETFs – I think the price will start to go back up again," he said, adding once the sell off is done, and it's stabilized, the price could make a run at $1900 or $2,000.

When asked why we should buy gold, Bianco said, "Gold is more than an inflation hedge, it’s an anti-fiat money hedge.

"In this currency war, every major central bank tried to out ease the next central bank and devalue their currency … Gold is the hard money currency in a world of devaluing currencies. That’s been its story for the last 10 years and I think that it will continue to be its story."

Watch the full interview here:

Front page image: Bloomberg TV screengrab