Solid… As A Rock
Before I go over today’s Cartel capping job – er, “market activity,” – let’s start with an article that popped up on Zero Hedge this afternoon, to which I respond – DUH!
Has Bernanke Become A Gold Bug’s Best Friend?
“Helicopter Ben” symbolizes why we own physical gold and silver, but is just a figurehead in the TPTB’s battle against REAL MONEY. Power hungry, status quo seeking governments have fought the MONEY PRINTING constraints of gold and silver standards for centuries, and “independent” or not, Bernanke is just another government employee. Do you think it’s a coincidence the Fed “unexpectedly” became more dovish the day after Obama’s SOTU speech, for all intents and purposes kicking off his re-election campaign with a monetary bang? If so, think again.
Benny may be the current Fed Chairman, but Greenspan and others before him kowtowed to the political establishment in like manner, as ordered by both “conservatives” such as Nixon, Reagan, and Bush, and “liberals” like Johnson, Clinton, and Obama. And don’t forget the Central Bankers in Europe, Japan, China, and numerous other nations, as well as “powerbrokers” such as George Soros with both political influence and a sociopathic lack of consideration for human rights.
Of equal importance, the full interview with “ADMIRAL SPROTT,” published this morning with Eric King, a must listen piece.
King World News – Eric Sprott Interview – 1/26/2012
In it, several very important tidbits emerged, the first that a producing silver miner participated in last week’s PSLV offering, demonstrating that ADMIRAL SPROTT’S “Call to Action” initiative two months ago is bearing fruit.
Silver Producers – A Call to Action – November 2011
Not only that, he disclosed that Endeavour Silver, a high-quality mid-tier producer, agreed to hold back two-thirds of its December quarter production, citing Sprott’s advice to hold out for higher, NON-MANIPULATED prices, detailed further in the article below.
Why Endeavour Silver Corp. Is Now Withholding Gold & Silver Inventory From The Market
I view these two events as HUGE news, indicating a handful of savvy, shareholder-friendly mining executives are starting to understand the manipulation and fight back. Until recently, I had NEVER heard of a mining company responding to manipulation, the most important factor in its business, but obviously the firm that participated in the PSLV offering, Endeavour Silver, and others such as First Majestic Silver are starting to get it.
Keith Neumeyer: The Silver Market Lacks Integrity
The last time a public miner of ANY KIND withheld production was the early 2000s, when Rob McEwen was still running Goldcorp, per this quote from an old interview I dug up:
In 2001, when gold was $270/oz, at Goldcorp we started to withhold part of our gold production. The reasons were threefold; one, I believed the gold price was going much higher, two, there were tax advantages to selling it several years later and three, we increased our financial assets by holding back the gold. Several years after we started we had more gold in our bank vaults than half the central banks in the world.
When Goldcorp merged with Wheaton River resources (from whence Silver Wheaton was eventually born) in 2005, Wheaton River’s Ian Telfer became Goldcorp’s CEO, paving the way out for McEwen to explore other ventures, which ultimately were U.S. Gold, Minera Andes, and VG Gold. Once McEwen – one of the industry’s true “mavericks” – left, it was back to “business as usual” at Goldcorp, i.e. selling gold at depressed prices and thus harming shareholders.
In my view, the aforementioned “silver investments” by producing miners are potential game changers in the war against Cartel PAPER silver suppression. Not only that, they are likely the “tip of the iceberg” in a broader trend of “mainstream entities” entering the PM market, per the timely comments made yesterday by “Mr. Gold,” Jim Sinclair. Obviously silver miners are the most likely starting point for corporations investing in PHYSICAL silver, but ultimately Sinclair expects corporations of all types to purchase Precious Metals, as well as individuals, endowment funds, and municipalities. It looks like a few more people, and entities, may PROTECT THEMSELVES after all!
Jim Sinclair – Mainstream Entities Will Now Enter Gold Market
And one final point from Sprott’s interview that I wanted to mention, regarding Chinese gold imports EXPLODING in late 2011. Per the chart below, Chinese gold imports were a staggering 102 tonnes in November alone, or HALF THE WORLD’S PRODUCTION, not including Chinese gold production, which is entirely consumed by its government.
Such meteoric demand growth gibes with last week’s comments from the notoriously prescient “London Gold Trader.” After reading his commentary for the past five-plus years, I am quite positive he is intimately plugged in to the Chinese government.
London Trader – Staggering Gold Demand Creating Shortages
Clearly the Cartel is being “taken on” by the Chinese government and other, GLOBAL buyers of PHYSICAL gold – such as the Russians and Arabs – which should tell you just how much naked shorted PAPER gold has entered the market since “OPERATION PM ANNIHILATION II” commenced on December 8th. Just six weeks later, silver is ABOVE its “pre-OPMA II” price, and gold just $20 away from that level.
Russian President Dmitry Medvedev
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FRIDAY MORNING
Friday morning, and what a week it has been! A HISTORIC Fed capitulation, MASSIVE debt ceiling increase, FAILED “COMEX OPEX” gold attacks, and now a MISERABLE GDP report. Given the cheerleading Fed was forced to dramatically reduce its GDP forecast just two days ago, one would think such atrocious results wouldn’t be “unexpected.” Unfortunately, the “financial industry” is now populated by dolts, who long ago lost critical brain functions after years of being spoilt with artificially low interest rates, upwardly manipulated data, and of course, bailouts any time they are wrong, i.e. ALWAYS.
Q4 GDP Misses Estimates, Inventory Stockpiling Accounts For 1.9% Of 2.8% Q4 US Economic Growth
While at the gym this morning, I noted the incredible calm resulting from the past two month’s market LOCKDOWN by TPTB, yet another contributor to the aforementioned destruction of critical neural paths. I then pondered an interview last night with Ann and Nancy Wilson of Heart, perhaps the greatest female rock stars ever, recalling the making of their hit album, Dreamboat Annie, in the 1970s. The Vietnam War horrors inspired their music, and to this day brings tears to their eyes. Unfortunately, such emotion no longer exists in America, as citizens could not care less about dying soldiers, moral turpitude, and wasted time and money. Instead, they borrow PRINTED MONEY to buy $600 iPhones, watch reality television, and ignore true reality, such as the onset of World War III being discussed, as I write, by the world’s “elites” at Davos, Switzerland.
Israel says Iran ‘drifting’ toward nuke goal line
They ignore the impending default of the ENTIRE European Continent…
…the world’s third largest economy…
…and, of course, the first largest…
Update: America Has A $16.4 Trillion Debt Ceiling In 52-44 Senate Vote
…while continuing to re-elect the hypocrites that endorse such profligate spending, but then pretend to care in election years…
Republicans Demand Block Of US IMF Funding To Bail Out Europe
…and hoping the impossible becomes possible, such as the funding of pension plans assuming 7.5% long-term annual returns when the Fed has pledged ZIRP until “at least 2015.”
IceCap Asset Management: No Country For Old Men
Running on the stair climber, I thought of the great line from Titanic, “waiting for an absolution that would never come,” which describes the situation perfectly. Sorry America, Europe, Japan, and most of the U.S. dollar-enslaved world, absolution is impossible. The mathematical certainty of currency collapse is undisputed, just as was the certainty Titanic would sink once five of the 16 compartments filled with water.
Back to the markets, it looks like even the PPT is having trouble keeping them afloat after such a turd of an “unexpected” GDP disaster, but then again it’s early. Gold flat-lined all night, again resisting all attempts to push it down, even at 3:00 AM EST. As you can see below, the Cartel attempted to push gold down the second the gold-positive GDP report emerged, but for naught as it raced back up, pushing towards $1,730/oz as the power of hyperinflation fears start to seep into investor minds the world over.
Let’s see what 12:00 PM EST, the “cap of last resort” has to offer, as thus far the first three KEY ATTACK TIMES have miserably failed. Remember, the Cartel’s biggest nightmare is soaring gold and plunging stock prices, as occurred in both February 2009 and August 2011, before they redoubled their manipulative PAPER shorting efforts, of course. Once you see such a divergence re-emerge, you will know TPTB are being seriously challenged by MAJOR, GLOBAL PM BUYERS.
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SOLID…AS A ROCK
In today’s increasingly cut-throat, financially deteriorating, morally depraved world, nothing makes me smile more than art forms that emanate goodness, selflessness, and sheer joy in the art of performing for others. Particularly given that my job and passion relates to uncovering the opposite, I feel a particular affinity to such innocence, which I am fortunate enough to see daily when my wife joyfully sojourns to teach ballet.
Some of my favorite “kitsch” is 1980s R&B music, and none depicts this artistic sunshine like Ashford and Simpson, who performed together as husband and wife for more than 35 years before Ashford’s unfortunate death last year at the age of 70. They were most accomplished as songwriters (they wrote the Supremes’ “Ain’t no Mountain High Enough” and Chaka Khan’s “I’m Every Woman”), but most famous for the hit 1984 single “Solid as a Rock.”
This video, filmed in Central Park – near Valerie Simpson’s Bronx roots – is one of my favorites. The couple was happy their entire lives, and emanated every ounce of their lust for life, and each other, in this song. And not only that, espoused a theme that would later be the mantra of Precious Metals investors throughout the most difficult financial crisis in modern history.
http://www.youtube.com/watch?v=AEC04BfqMy0
The past decade marked the end of a Golden Age for the Western world, the brief period between the commencement of the “fiat standard” in 1971 and the point when the limitless DEBT it engendered lost its marginal productivity, per my January 20th RANT, DIMINISHING RETURNS. In other words, there was nothing “golden” about it all, simply a period when cumulative debt – on the individual, corporate, municipal, and sovereign levels – was low enough that it appeared to serve a beneficial role to society. Ah, the early siren song of fiat currency!
This is the problem with experimenting with fire, as the WORLD had never attempted a global fiat standard in which ALL currencies were backed by nothing except the “full faith and credit” of banker-operated governments. Nearly everything is OK in moderation – including debt – but breaking the bond with gold gave such governments the green light to PRINT as much money as they desired, for earmarks, welfare, and campaign promises. And if there’s one thing I have learned in life, “free lunches” will ALWAYS be accepted when “the going is good.”
To the contrary, it wasn’t “good” at all, but bad, very bad. It is hard to believe the ENTIRE WORLD went from fiscally sound to cumulatively bankrupt in just four decades – with most of the damage done in the last ten years – but it has, the ultimate testament to the selfish, self-destructive core of HUMAN NATURE. Consequently, the global of standard of living, particularly in the Western world, will decline for decades to come, with financial pain, political turmoil, and social unrest the ultimate result.
The nostalgia of timeless art, such as that produced by Ashford & Simpson, will be all many have to cling to, as the ravages of hyperinflation will make life extremely difficult, and in many cases, endangered. I do not venture to say owning PHYSICAL gold and silver is a panacea to what ails the world, but I do know ownership will make your finances – and state of mind – SOLID…AS A ROCK.
I Bought Platinum Yesterday. Do You Want to Know Why?
I lost count how many articles I read in the last 24-hours that concluded with the Fed’s announcement yesterday’s, that they will keep interest rates near zero at least until 2014, and that QE3 was “on the table,” gold is now in a “risk-on rally” take off. It is a fact, central banks are now “printing money to a degree never seen in human history.” This is massive (overt and covert) QE.
This round of QE will carry with it profoundly damaging, risk creating and wealth destroying effects. David Stockman, President Reagan’s Budget Director, correctly called it “Monetary Heroin.”
Speaking of David Stockman, as I recall, when my lovely wife Susan was in her 30s and working for a Minneapolis advertising firm, one afternoon as she was in the lobby at General Mills, David Stockman was passing through. He tried his hardest to get her to go out with him for a drink. This much I must say – the man has very good taste (in women)! Susan has even better taste – she politely refused.
Yesterday, the phones were ringing non-stop. Funny how people always decide it’s time to buy after the prices start to move up. Sentiment really does rule the markets and even I react to the same emotions as our clients. I placed a large order for platinum for myself, in the morning. I am storing it over at Dakota Depository in Fargo where many of our clients store their precious metals too. I have been thinking about buying platinum for several weeks and probably waited longer than I should have – it cost me $160 an ounce more than necessary, because I was ready to move at $1,450 and my two week wait upped the purchase price to $1,610, but platinum is still very undervalued. Two years from now, $1,450 or $1,650 will look like a bargain. There are many reasons to consider buying platinum, and I have brought a few articles to your attention recently, and there is a good one in today’s newsletter by Chris Ackerman, but for me, the single most compelling reason is gold confiscation. Gold confiscation? What does that have to do with platinum? Everything! Although I consider it an unlikely event, it is still a possibility, and should it happen, you can be sure that platinum will not be part of the ultimatum. Can you even begin to imagine how valuable platinum will be if it will be illegal to own gold? You can’t? Neither can I, but it will be worth a fortune! I now own one fifth as much platinum as I do gold and will be able to (financially) survive a gold recall.
In today’s daily, the ever-interesting Bill Holter wrote,
The action in the precious metals yesterday was very, very significant and after pondering on it overnight I truly believe the 3rd and final “mania stage” has been kicked off. Let’s first look at the fundamentals. The Fed told you yesterday that they will foster a policy of negative (if they could create negative nominal rates I’m sure they would) real interest rates for at least 2 more years. We have also watched reported (probably fake) inventories of precious metals continue to drop. Central banks have become buyers of Gold while in the U.S. and Canada, sales of 1 oz. Eagles and Maples are now running at a faster pace than TOTAL production of all mines combined. Since Silver inventories in the U.S. and Canadian mints are nonexistent, if these coins are to be minted in the future, the mints must become buyers. Never mind industrial demand, jewelry demand, investment demand of bullion bars or anything else, the sales of 1oz. coins are eating up all supply.
Bill may be right. If this rally continues, yesterday could be the kickoff of the third stage of the bull market in precious metals, the Mania Stage. My friend, Trader David R, who I often quote in these pages (you won’t see him quoted elsewhere; he’s too busy making money), told me that he’s going to London next month and asked me if I wanted to come along. He said he would take me on a tour of JPMorgan’s gold vaults so I could “see” with my own eyes how much physical gold they are sitting on. I mention this because a long time ago, Jim Sinclair surprised me when he wrote that the people who are short now will be the same people who are long when the bull market takes off. Odds are that JPMorgan will not be buried by the move up; they will make more money on the move than anyone else. They play the market like a yo-yo and although it is, as many would say, blatantly illegal and pure manipulation, the fact is that they are very good at it and trust me, will not be left at the gates when the final whistle blows and the race to the gate commences. Yesterday may have signaled that the whistle has been blown.
When I asked Trader David R. where he stood on gold as of yesterday, he replied, “The FED is doing a better job making sure gold goes to $2,000 by the end of the year and you are safe to be long for the next 3 years!“ That statement was music to my ears, and you know how much I love music!
The brilliant Bill Holter wrote a great column yesterday (the first article in today’s daily). In it he pointed out, “Central banks have become buyers of Gold while in the U.S. and Canada, sales of 1 oz. Eagles and Maples are now running at a faster pace than TOTAL production of all mines combined.” As you know, I’m in the gold business and what he wrote is the truth. I’ve been warning you for a long time now that there will be shortages and the premiums on gold and silver eagles will increase. It’s coming!
According to Jim Wycoff at Kitco,
Technically, February gold futures prices Wednesday scored a big and bullish “outside day” up on the daily bar chart, whereby the high was higher and low was lower than the previous session’s trading range, with a higher close. The market saw important and technically bullish follow-through strength Thursday. Indeed, the bulls have gained fresh, solid upside technical momentum. A four-week-old uptrend is in place on the daily bar chart. Bulls’ next upside technical breakout objective is to produce a close above solid technical resistance at the December high of $1,767.10. Bears’ next near-term downside price objective is closing prices below chart support at $1,640.00. First resistance is seen at the overnight high of $1,720.50 and then at $1,725.00. First support is seen at $1,700.00 and then at $1,681.80.
March silver futures prices hit a fresh seven-week high overnight and scored a bullish “outside day” up on the daily bar chart Wednesday. Silver bulls have the overall near-term technical advantage and have gained fresh upside momentum. A four-week-old uptrend is in place on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at the December high of $33.74 an ounce. The next downside price breakout objective for the bears is closing prices below major psychological support at $30.00. First resistance is seen at $33.74 and then at $34.00. Next support is seen at the overnight low of $32.97 and then at $32.50.
Jim Sinclair provides a more interesting view of where gold is headed. I love his Angel charts!
The following link is to a short eight-minute speech by Judge Andrew Napolitano and was sent to me by one of our readers. Susan and I watched it this morning, and were speechless. You will be too. Do you believe America is The Land of the Free and the Home of the Brave? Please check out what Judge Napolatino has to say about our freedoms.
| Judge Andrew Napolitano Natural Rights Patriot Act |
Overt or Covert, “QE to Infinity” is Here
Back in August 2011, a whopping five months ago, I was AMAZED when the Fed outwardly expressed its FEAR of global economic COLLAPSE by announcing an extension of its “ZIRP,” or Zero Interest Rate Policy, until “at least mid-2013.” I have long espoused that Bernanke & Co. have never had a clue what they were doing, simply PRINTING MONEY in increasingly large quantities like his successor, Sir Alan Greenspan. Lucky for the “Maestro,” he printed money when there was still a buffer to do so, before DEBT SATURATION set in, commencing the inevitable END GAME of financial collapse and hyperinflation.
August 9, 2011: Fed Extends Super-low Rates Until 2013, May Use More Tools, 3 Members Dissent
Jim Sinclair invented the term “QE TO INFINITY” around five years ago, but Richard Russell had him beat when in 2002 he first penned the words “INFLATE OR DIE.” Both represent the same concept, the mantra that has guided my investment decisions for the past decade. Consequently, I have been 100% invested in Precious Metals for nine years, eight months, and expect this allocation to continue indefinitely, perhaps the rest of my life.
November 26, 2002: Richard Russell on the Markets – “INFLATE OR DIE”
In recent weeks, fighting an endless torrent of PROPAGANDA about a fraudulent economic recovery (culminating with this week’s (Miserable) State of the Union speech, I have written of the inordinate amount of global “financial leaders” beggingfor increased MONEY-PRINTING in various forms. Be it the Fed’s “swap facility,” ECB’s “LTRO” mechanism, Obama’s “mortgage forgiveness bill,” an increase in the EFSF, ESM, or IMF’s “rescue funds,” OVERT money printing has accelerated alongside COVERT mechanisms, with pleadings for more OVERT schemes growing more shrill each day.
You see, not only is the GLOBAL financial system on the brink of COLLAPSE, but it’s an election year in the U.S., the focal point in the saga of doom. In other words, not only is the fate of the ENTIRE WORLD at stake, but Obama’s position as the “leader of the free world,” which I facetiously quote because the U.S. long ago forfeited its role as “leader” in lieu of the morally and financially bankrupt position of SLAVE OWNER.
Since the gold standard was abandoned in 1971, the nation’s “leaders” have destroyed America from the inside out, viciously abusing the Bretton Woods agreement by PRINTING MONEY to the point of debt saturation, i.e. “NO RETURN.” America was not alone in this grand Ponzi Scheme, abetted by cohorts at the Central Banks of Western Europe, Japan, and China, but they were the ringleader. As SLAVE OWNER to the world, it lorded over billions of unsuspecting people with the threat of depreciating the cancerous “dollars” it exported, allowing American jobs to be exported overseas in exchange for Central Bank purchases of U.S. Treasuries, keeping interest rates artificially low and encouraging spoiled, profligate American individuals, corporations, and municipalities to BORROW and SPEND. Given the world’s tether to low U.S. interest rates via its ENORMOUS holdings of dollars and Treasury bonds, the same BORROW/SPEND Ebola virus spread the world round, at hyperbolic rates in the past decade when DEBT SATURATION set it, yielding increasingly minimal output gains with each dollar printed, per the two charts below from my January 20th RANT, “DIMINISHING RETURNS.”
No entities benefit more from MONEY PRINTING than banks, and once banking Cartel stooge Alan Greenspan took the Fed’s reigns in 1987, the sector’s profitability EXPLODED. First via the tech bubble, next the housing bubble, and finally the all-encompassing DERIVATIVES bubble, banks earned TRILLIONS of illicit profits, particularly in the past decade after they commandeered the U.S. government and broke down Glass-Steagall.
In other words, just as DEBT SATURATION was approaching, the most indebted entities on Earth took over the government, likewise in Europe. The global banking system was awash in debt of its own making, the inverse of sovereign nations, tricked into this terminal condition by their “masters” at Goldman Sachs, JP Morgan, and the like. “Leverage cancer” proliferated in corporations, municipalities, and individuals, across all borders, with each new crisis treated with new DEBT and heighted SLAVEDOM to the increasingly malevolent United States of Corruption and Money Printing.
The financial “Tower of Babel” started crashing in mid-2008, just as the “Debt Saturation Phase Transition” line in the above graph went negative, and you can see what the line did afterwards, although scarily the graph was printed in late 2010, before the REAL money printing really began. Today, that line is off the bottom of the charts, and pretty soon will depict a NEGATIVE $1.00 of GDP for each PRINTED dollar of additional debt. Oh yeah, there’s a technical term for what happens when PRINTING MONEY turns from bad to really bad, and it’s called HYPERINFLATION.
The concepts of “Inflate or Die” and “QE to Infinity” are congruous to a crack addict needing more drugs, in higher doses, to survive. The problem is he becomes sicker and sicker with each dose, and in the end always dies. Per the graph above, the WORLD has reached the point where the increased doses are killing it, but it dares not stop for fear of an immediate fatal, heart attack (not to mention, election losses). I do not blame Bernanke, Obama, or any single person or nation for the mess we are in today. If Obama, for instance, had NOT bailed out GM and Citigroup, the system would have died three years ago, as it would have under Bush’s watch if Fannie Mae and Freddie Mac were left to die. The Fed, ECB, BOE, BOJ, PBOC, and ALL the world’s Central Banks are in the same boat, “paying the piper” for the deal with the devil they made in 1971, when they collectively allowed the U.S. to abandon the gold standard with nary a peep of protest.
The financial disease of HYPERINFLATION has no cure, but fortunately can be avoided via common sense and preparedness, and most importantly, trading in your rapidly depreciating SCRIP for REAL MONEY, i.e. PHYSICAL GOLD and SILVER.
John Embry – Gold is the Cure to Epic Monetary Debasement
As noted above, I was floored when the Fed announced in August 2011 that it would maintain zero interest rates until “at least mid-2013,” essentially screaming its belief the economy will be weak for another two years. And don’t forget, this was right around the time of the debt ceiling debacle, with U.S. debt sitting at $14.2 trillion, compared to $15.3 trillion today and likely $16.4+ trillion at year-end.
Today, with the government, bankers, and MSM relentlessly telling us the economy is “recovering,” the Fed decided that “mid-2013″ is not enough, and thus that ZIRP will remain until “at least the end of 2014.” It should be no surprise to students of reality, and certainly readers of this blog given my postings of comments from no less than FIVE Fed governors calling for additional stimulus, let alone the cries of half of Europe – including Portugal today - for endless, can-kicking, toxic bailouts. But so it is, this “unexpected” announcement.
No QE3; ZIRP Extended Thru AT LEAST 2014 – Full December-January Statement Comparison
If there was ANY shred of doubt about the intention of the world’s financial “leaders,” or the REAL condition of the GLOBAL economy and banking system, it should be put to rest by this FOMC decision. Today was the OVERT admission, by the world’s most powerful MONEY PRINTING organization, that “QE to Infinity” is cast in stone. Hopefully you listened to Richard Russell’s advice in 2002, with the one caveat that “Inflate or Die” has now transmuted, via DEBT SATURATION, to “Inflate AND Die.”
PROTECT YOURSELF, and do it NOW!
Mr. Edelson, it looks like you are wrong.
As long-time readers know, I do not trade gold and silver based on short-term trends. I identify a long-term bull market and “ride the bull,” which is not easy to do.
I believe that the biggest dis-service a newsletter writer can do is to scare you with predictions of an eminent fall in the price of gold and silver. The biggest offenders are the “Chartists” and “Technical Analysis” group. One of the most visible from this camp is Larry Edelson, at Uncommon Wisdom. He did correctly warn of the fall from $1,900 but those taking his advice are still waiting for the bottom, he is still predicting, which he warns will find gold sinking to $1,405 and silver to $19 or $20.
Just last Monday, he was on the air broadcasting that “these up-moves are corrective in nature and no doubt the next big move is down.” He proudly pointed to his charts and says there is strong resistance at $1,680 and $1,726.70 and he is convinced that gold would not penetrate these levels.
The silver action, he said, looks terrible and silver will not breach $32. The downside for silver, he continued, was the $20 level or lower.
As of 9:17 a.m. on Thursday, I hate to tell you, but Larry’s dire warnings are looking – well, shall we say embarrassing. Gold is currently $1,726.70 and rising and silver is $33.59 and up another one percent from the close on Wednesday.
What Larry has managed to do is to keep investors on the sidelines, shaking in fear, since gold bottomed momentarily at $1,531 and silver at $26.11. And if you are one of the dear souls who listen to Larry, you are still sitting on the sidelines, paralyzed in fear. You have already missed the rise in gold of over $196 (12.8%) and the rise in silver of $7.48 (28.6%). And worse, some of you probably still believe in Larry’s charts and are not even considering jumping back in. Well, maybe when gold tops $1,800 and silver clears $35 Larry will come around and say, “It caught me by surprise, and honestly, I never expected this to happen.” Fair enough, but at what cost to his readers?
He still hasn’t figured out that the markets ARE MANIPULATED, and his charts aren’t working. That is why it is SO DANGEROUS to sell out and sit on the sidelines because some “Technical Analysis” guru tells you to, when all you have to do is tough out the pullbacks and stay in the game. That is not to say that things will be smooth-sailing from here on. To the contrary, the gold and silver market will be a bumpy ride with many more ups and downs. My point is, don’t let someone scare you out of your positions. All of these guys are trying to sell you their paid-for subscriptions and turn you into “traders.” This is a very dangerous thing to do. They will show you how to trade yourself right out of the gold and silver bull market. Hold tight as the big moves are yet to come and even Larry is bullish by the last half of this year. As our friends at GATA say: You Gotta Be In It To Win It.
Looking at the 6-month gold chart, you can see that the $1,750 level is the next strong resistance point. Then $1,800. Gold is above its 200-day and 50-day moving average, so many hedge funds will be coming back on the long side of the Comex market.
There must have been a LOT of short covering today, for gold to break its bonds of “never more than a 2% gain in any given day.” Gold is up 2.62% at the moment and that is all but unheard of. The high-low swing in gold today was $66. Sinclair said that swings of $100 a day would become common. That is yet to come, but we are getting closer and closer. This is not a market to short or trade except for the most experienced of our readers. It is a time to buy the dips and hold on tight as the crazy “bull” tries to throw you off.
Tomorrow is the February option expiry day, and that almost always means that the bullion banks will smack down the price so the options they sold will drop out of the money and they get to keep the premiums paid for the options without having to pay out any money. It is no surprise gold has been under pressure the past two trading sessions. What irks me is why no one in the mainstream gold world ever questions the tendency for gold to fall a fair amount around an option expiry. Right on cue, the price of gold was taken down around $20 starting at the usual “attack time,” 3:00 a.m. New York time. But then a strange thing happened. Gold unexpectedly exploded up more than $60 on the news that the Fed was holding interest rates at zero until at least 2014. QE3, welcome! Even though it has not been (yet) announced, there is no question any longer, if there ever was any, that it will be and dollar debasement is a certainty. The unusual rise in the price of gold signals what the folks over at Casey Research called “the end of the petrodollar” in yesterday’s daily. The dollar is now caught in a vise between further monetization and the willingness of other countries to conduct business in non-dollar currencies, and yes, even gold.
We are no longer talking about small meaningless economies like Venezuela or North Korea. The dollar is being quietly set aside in countries such as Russia, China, India, and others. When these countries start conducting business, especially in oil, in currencies other than the dollar, they are very unlikely to accumulate excess dollars to purchase US Treasuries with. This is the environment whereby countries would logically sell US Treasuries.
So here we are, at the very time our government needs to sell more bonds, as our annual deficit expands by more than $1 trillion a year, only to find the marketplace is less willing to buy our bonds. What then, you ask? The Fed is, after all, the buyer of last resort and they will buy any unsold Treasuries and enough of them to hold interest rates at zero. Lot’s of luck, I say!!
This is the recipe for inflation, serious inflation. There is a lot of talk about “deflation” and true enough, many asset classes, including real estate, are losing value, but this misses the point. The inflation we are about to experience is not based on increased demand or a strong economy, neither of which we now have. It will be based on DOLLAR DEBASEMENT, which is exactly what will happen as the Fed continues its futile and ill-advised policy of zero interest rates and quantitative easing.
In the 80s and 90s I was pretty close with Ken Coleman who wrote an excellent newsletter called The Fed Tracker. It was Ken’s contention that the most important thing to do if you wanted an “edge” on how to invest, was to watch closely and determine what the Fed was about to do. Well, we don’t have to guess any longer. They had told us what they intend to do. They will buy bonds, and worthless assets from the banks, funding them so they can buy the bonds, and the dollar will suffer and gold will continue to amaze with its move up.
The gold market has yet to enter its third and final phase in this 11-year old bull market. It is on the threshold. My guess is once gold tops $2,000 – $2,200, the media will finally “discover” gold and investors who have sat on the sidelines all the way up, will finally decide it’s time to buy gold. There will be shortages. There will be delays. There will be a lot of money made by those who already own physical gold. It’s coming. The Fed, today, told us so and the market reacted!
Taking a casual look at the exchange rates, the dollar was down and the euro was up, but so were the Australian Dollar, the Canadian Dollar and the Swiss Franc. The US dollar’s fall was not strictly a euro-event. Gold was up in every major currency in the world. Day after day, gold is re-asserting itself as the safest form of money and more desirable than any paper fiat alternative. Central banks are accumulating gold. Iran and India will trade oil for gold. The world is changing right before your eyes, if only you look at the events – you’ll find them all right here in our daily.
Here is a chart, courtesy of Australia’s Nick Laird, that shows all currencies are falling vs. gold – i.e. gold is rising against all currencies. All I can do is think of the title of one of my all-time rock songs, by the Marshal Tucker Band, “Can’t you see!” And I say to you, dear readers, “Can’t you see?!” I know it is small print, but the charts are, from left to right, top to bottom, gold priced in Australian Dollars, British Pounds, Canadian Dollars, Chinese Renminbi, Euro, Indian Rupee, Japanese Yen, South African Rand and Swiss Franc.
Weekly Interview with Kerry Lutz
Check out this week’s interview with Kerry Lutz and Ranting Andy:
1/25/12- Ranting Andy Interview with Kerry Lutz of the Financial Survival Network
Respect
Tuesday afternoon, and the world is agog of Apple’s blowout earnings. Good for them, it’s nice to see an American company doing so well, not via government (i.e. taxpayer) largesse but old fashioned ingenuity and business savvy. My first “desk job” involved word processing with an Apple Macintosh circa 1990, when it was struggling to survive in the computer business. Apple’s desktop business never became the powerhouse Steve Jobs envisioned, but my god what he’s done with gadgets such as the iPod, iPad, and iPhone. He and Bill Gates are two of the smartest men America has ever produced, and I wish the best of luck to Apple for decades to come.
Of course, I don’t own Apple, or any other stock in the entire market. My last non-Precious Metal stock was sold in April 2000, and my last mining stock last summer. You see, in a 100% rigged market, buying OR selling short is hazardous to your financial health, particularly when TPTB have no interest in helping you become wealthy. True, they support the Dow Jones Industrial Average and other stocks deemed important to “national security” – such as TBTF banks – but everything else is fair game, the domain of criminal HFT algorithms. At times, TPTB attack the stock market if it’s deemed politically expedient, particularly as an excuse to OVERTLY announce new stimulus programs. As Bill Murphy says, “Market action makes commentary,” and if the PPT takes the Dow down a few hundred points, it knows the puppet media will rush out the “deflationary collapse” headlines so useful in supporting new MONEY PRINTING initiatives.
Of course, that is the opposite of the PPT’s current plan, to NEVER let the Dow meaningfully decline – EVER. This (Tuesday) morning at the gym, Dow Futures were down 50 points, but miraculously never dropped further despite abject failure of the comical “Greek debt negotiations,” as well news that the IMF significantly reduced its 2012 growth estimate (growth, yeah right!), warning a “severe recession” could ensue if the EU doesn’t act to resolve its debt crisis.
IMF Cuts Global Forecast, Sees European Recession, Warns Of 4% Economic Crunch If No Euroarea Action
I don’t know about you, but that sounds darn gold positive/stock market negative to me, identical to the headlines yielding such market activity last summer. Essentially, a plea by the IMF for the ECB to PRINT MONEY, and do it NOW, plus a “worst-case scenario” threat of another global financial crisis. European stock markets were down roughly 1.5% when this emerged, but somehow righted themselves by day’s end. The Dow, of course, was rescued within minutes of the open to set the tone, with no volatility for the remainder of the day.
The dollar barely budged, and base metals had extremely strong days, such as zinc (+5%), lead (+3%), and nickel (+2%). Per the charts below, all four spiked up at the COMEX open, with nary a blip downward all day, while Zero Hedge maintained its streak of stupidity by flashing out its moronic “risk off” headline.
I don’t think there’s a more idiotic term in modern markets than “risk off,” which gets thrown out every time the Dow falls 30 points or copper a few pennies, even more so because traditional safe havens like PHYSICAL gold and silver have been the ultimate “risk off” securities for the past 5,000 years, not to mention in early 2009 and mid-2011 amidst dramatic market turmoil. Even more idiotic is not following up such knee-jerk drivel-spewing with commentary wondering why, in a “risk off” environment, global stock markets ended the day barely lower, base metals higher, the Euro unchanged, and Precious Metals significantly lower.
Not only lower, but via the EXACT SAME PATTERNS as we see every day, be it an up or a down day. All day long the Dow / Gold x 2 ALGORITHM was on, never allowing gold to meaningfully rise during PPT-inspired Dow goosings. Conversely, it was smacked down each and every time it attempted to rise, per the ridiculous – and common – jagged pattern in the green line below. Quite a coincidence that “risk on” commenced at EXACTLY 3:00 PM EST for gold, with yet another mini-WATERFALL DECLINE at EXACTLY the COMEX open at 8:20 AM EST, followed by a third at EXACTLY 12:00 PM EST when it had the gall to try and rise. Come to think of it, EXACTLY like yesterday’s COMEX trading pattern, and hundreds of other days over the past decade. The similarity of the red and green lines below is all the evidence you need to see – but not enough for “Tyler Durden” to spend material time on.
And don’t forget the abysmal mining shares, down another 2%, not including another horrific performance from Pan American Silver (PAAS), under relentless attack from Cartel naked shorts to continue the façade that ALL mining share news is horrific. Miss earnings by a penny, make an acquisition, see a 5% cost increase, etc. – you name it, and your stock will plummet 20%. Hardly the PROTECTION against imminent hyperinflation one is looking for. Mining share earnings and resource/reserve multiples have been CONTRACTING since 2007, and until the Cartel is BROKEN I see ZERO chance of this loss-inducing trend abating.
Other than the aforementioned dire IMF economic warning, which in today’s “LOCKDOWN” market environment is no longer newsworthy, just more of the same from both sides of the pond. There is simply no way of describing Europe other than bankrupt basket case, with perhaps a dozen nations committing ongoing political and economic suicide each day.
Whether it’s Spain begging for more bailout funds (geez, take a look what an unadulterated unemployment chart looks like)…
Desperate Spain Wants European Rescue Fund To Be “The Bigger The Better”
Standard & Poor’s warning of an imminent Greek default…
S&P Warning Of Imminent Greek Default Again – Zero Hedge
The realization that Portugal is next on “financial death watch”…
Portugal Reenters Bailout Radar As Traders Realize Greek “Rescue” Model Is Not Feasible Here
Or Italian police breaking into S&P’s offices last week, and Fitch’s today…
Italy Police Busts Fitch Milan Office
…the end result is the same. Capital is FLEEING the PIIGS (and will soon be fleeing “bigger fish” such as France, Germany, and the UK…
…and the only way to prevent immediate default, and subsequently collapse of the Euro currency, is massive MONEY PRINTING. TPTB will continue down this course, i.e. “QE to Infinity” as they have no choice, but given the DIMINISHING RETURNS of new debt, the ultimate HYPERINFLATIONARY result is set in stone.
Here in the States, the situation is no different, other than that our “world reserve currency” enables us to paper over our problems more so than other nations. That said, this privilege has been catastrophically abused, to the point that America has more sovereign debt than all of Europe combined – and that’s just the “on balance sheet” amount, ignoring $5 TRILLION owed by “off balance sheet” entities such as Fannie Mae and Freddie Mac, plus $100+ TRILLION of “unfunded liabilities.” Not to mention, the potentially TRILLIONS of bank losses to be transferred to TAXPAYERS in Obama’s abominable “mortgage settlement plan,” to be unveiled shortly.
Obama to Use Pension Funds of Ordinary Americans to Pay for Bank Mortgage “Settlement”
Then again, holes in the dollar’s armor are rapidly widening, as non-dollar currency settlement agreements have been signed by nearly all major Eastern powers in recent months, such as China, India, and Japan. Even more ominous is this hot-off-the-press announcement that Iran is now accepting GOLD from India in exchange for crude oil, a practice which five years from now may be more common that oil for petrodollars.
Gold for Oil: India and Iran Ditch Dollar – Report
This news is HISTORIC, as it once again re-establishes GOLD as the international currency it has been since the earliest human civilizations. I cannot overemphasize the importance of this development, which could commence a “chain reaction” of similar REAL MONEY contracts in a very short period of time. In essence, it represents the “beginning of the end” of dollar, and “middle of the end” of the petrodollar. I could go on for some time of its importance, but instead will let my good friend Bill Holter do the talking for me…
To all; “India trades Gold for oil with Iran”, this news came out yesterday with little fanfare and even less response from the markets. This is really BIG news! India is entering into an area that has been absolutely taboo since the 1947 Bretton Woods conference. It has been “expressly forbidden” to conduct trade amongst nations using Gold as the medium for settlement. Now, India is skirting the plans and wishes (demands) of the U.S. that the world embargo Iranian oil. Not only that, as a side irritation to the U.S., our “ally” Turkey, is facilitating trade with Iran through their banking system. Oh yes, lest we forget, Russia and China have set up trade deals amongst themselves AND with other trading partners where the Dollar will not be used. It is this “settlement of trade” function that has been a source of huge Dollar demand during our entire lifetimes that is now being threatened.
Please keep in mind that this lower demand for Dollars is coming at a time where the Fed has, is and must in the future, create more Dollar supply (creating debt) than any time in the past. In my opinion, the ultimate “pushing on a string” will result and Dollar supply will dwarf demand. This will result in hyperinflation and it will be as we thought all along, a currency event. Can we go through a period where the Dollar gets squeezed higher because of temporary demand to repay international Dollar denominated debt? Can we see foreign currencies “drop” faster than the Dollar because foreign currencies are largely backed and reserved with Dollars? Yes we can, but in the end, where does real and sustainable demand come from if the Dollar is not used to settle trade?
The answer to this question? It doesn’t in any real form. I can envision the absolutely comical situation where the Fed “prints” Dollars to “buy” Dollars on the open market (don’t laugh, this has and probably is already happening). As the current Dollar/debt system is an outright Ponzi scheme, anything and everything will be done to prolong it. BLS statistics and government statistics are “made up” to the absurd all the time, what would stop the Fed from “fudging” money supply numbers? We know now of $16 Trillion worth of international loans back in 2008-2009 that we knew nothing of then so…we should faithfully believe they would not do it again? The Fed has been strenuously avoiding audit and simply says “trust us”. Well, we did that…for too long and look where we are now.
Do you see what I am getting at here? This is crunch time big time! Just as we are NEED extra demand for Dollars, the opposite is happening. Just as “they” are running out of paper tricks and physical supply to depress Gold prices, demand is ramping up! Mind you, this ultimately HAD to happen sooner or later, international traders are taking matters into their own hands and Gold is finally being re-monetized. My guess is that we will hear of a few more “Dollar-less” deals announced and then we will get the Big One. That being some currency or currency block that backs their paper with Gold on a ratio. Some sort of linking or (God forbid according to Bernanke and Geithner) “peg” to Gold is announced by a renegade government. Even 2 years ago this sort of “tin foil hat” thought was laughed at, soon it will be reality.
Anything, any policy and any type of volatility can commence from here. Do not be surprised by anything on a daily or very short term basis as we are in the desperation phase and any type of leverage or risks will be undertaken by the official sector to retain power (control). It will not stand and Mother Nature’s real and true money, Gold, will be the last man standing! Please, do not “get out of position” for any reason! Regards, Bill H.
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READ THE FULL NEWSLETTER
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Today’s RANT topic is going back to basics.
My job is to alert you of the REAL state of the economy, the so-called “shadow world” where TRUTH exists for the few that dare to enter, but my passion is empowering people to PROTECT THEMSELVES. As David Schectman noted in yesterday’s blog, he views me as a whistleblower against the establishment, particularly the Wall Street crime syndicate that enslaved me between 1989 and 2005.
I may be “young” in absolute terms, but at 41 have seen all sides of the financial world, as a compliance officer, bond broker, buy-side trader and analyst, sell-side analyst, and investor relations officer and consultant. I earned my Chartered Financial Analyst, or CFA, in 1998, and for those doubting my “credentials,” here is a list of the firms I worked for, or interned with, during my 15-year Wall Street career.
| Firm | Position |
| Paine Webber | College Intern |
| Shearson Lehman Brothers | College Intern |
| Merrill Lynch, Pierce, Fenner & Smith | College Intern |
| A.G. Edwards & Sons | College Intern |
| Prudential Securities | College Intern |
| S.G. Warburg & Co. | Compliance Officer |
| Cantor Fitzgerald | Bond Broker |
| Kensington Partners | Buy-Side Analyst/Trader |
| (Capital One) Southcoast Capital | Sell-Side Analyst |
| Salomon Smith Barney | Sell-Side Analyst |
Of course, that’s just career number one, as since leaving Salomon Smith Barney in 2005 I have worked exclusively within the mining industry. I spent four years as an Investor Relations officer for junior mining companies, and one with Torrey Hills Capital, the largest U.S.-based Investor Relations consultant to junior miners, all while writing “RANTING ANDY” blogs and acting as, for all intents and purposes, an unpaid principal of GATA, the Gold Anti-Trust Action Committee. While working with myriad mining companies – at least 30 by my count – I also gained intimate knowledgeable of Canadian investment banks, which diligently work to destroy their clients the way U.S. investment banks destroy the nation at large, and the global financial system for that matter. For those seeking to impugn my “street creds,” I welcome you to contact anyone I’ve worked for.
Why am I writing this, you might ask? NOT to brag, and frankly I’m not sure there is much to brag about, except that I worked my arse off for two decades, observing a lifetime’s worth of unethical industry practices along the way. In other words, my “whistleblower” persona – RANTING ANDY – was borne mostly of NURTURE, and hopefully a bit of NATURE as well.
Most communications with readers are positive, but occasionally I am criticized, and take each message seriously. Some criticisms relate to my opinions, some my writing style, and some my contentious attitude toward the mainstream. As much as I would like it to be the case, I will never be able to appease everyone, but I like to think I am an amiable chap, and that such sentiment is reflected in my RANTS. However, beauty is in the eye of the beholder, so some will always believe otherwise. All I ask is to be shown the same RESPECT I extend to you, unless you are evil bankers and politicians seeking to harm or discredit me. If that is the case, I will continue to demonstrate the same level of RESPECT you have shown me – NONE!
I am very open-minded socially, viewing the entire world as a meritocracy. First impressions mean a lot, but the entirety of one’s work means more, and sometimes – though rarely – first impressions are wrong. I cannot promise you will like – or even agree with – my work, but that each of you will be treated with RESPECT if such sentiment is reciprocal. It matters not your age, business credentials, or social background. Heck, it doesn’t matter if you are friend, neighbor, colleague, or even FAMILY, so long as you RESPECT my right to an opinion, which I provide, by the way, free of charge.
My overarching view is we are all born equal, uniformly deserving of RESPECT and DIGNITY, and for as long as I live, and write, I will follow that credo. For those seeking to discredit, slander, or shed my reputation in a negative light, good luck. I write for Miles Franklin because its principals share the same “mission statement” about life, and if there’s one thing I hope to be remembered for when I die, it will be the RESPECT I have shown the world, and all individuals around me.
A Challenge to Backwoods Jack
A challenge to Backwoods Jack:
I received an email from my friend, Backwoods Jack that was filled with inaccuracies and worse, questioned Ranting Andy Hoffman’s credentials and resume. I shot off a strongly worded email that told him he was out of his mind and that his son didn’t know squat about the precious metals market and when it came to the economy, was nothing more than the voice of Wall Street. Andy Hoffman said Backwoods must be suffering the effects from eating squirrel meat and was more outraged than usual and shouted, “Tell Backwoods Jr. to call me and say these things to my face!” He also said, Jr. would never call me, he doesn’t have the nerve! That prompted me to offer a challenge to Backwoods, and his son Backwoods Jr. It didn’t take long for Backwoods to reply. Here is Backwoods’ reply:
Backwoods Jr. is eager to respond! He will do so this afternoon and means no malice towards you or Ranting Andy. Nothing illegal about a possible controversy. Agreeing to disagree on occasion should cause no harm.
Sure, some egos might be flustered, but really it’s no big deal unless blown out of proportion. Even then, so what! Jr. is befuddled that you keep pushing back the timetable for the collapse of the US economy. Now you say two years when 18-months ago you prophesied that it would be occurring now. Jr. has some 50 brokers spread out in every major business market in the US under his leadership and they would not agree with you on just about everything you say, except the fact the gold and silver are worthwhile investments. Holding some cash is also prudent. Respectfully and gentlemanly I remain your friend under any circumstances.
Backwoods Jack
So I offered Backwoods and Backwoods Jr. a challenge, one that I honestly do not expect them to accept. And why am I so sure that Jr. wouldn’t accept? Well, it reminds me of a quote from Wm. F. Buckley Jr. when asked why John F. Kennedy wouldn’t accept his offer to debate him – Buckley said something to the affect that the sausage tries to avoid the meat grinder! It is still to be determined if Jr. has the strength of conviction to accept the offer and to date, my email inbox is empty. Here is my email to the Backwoods clan:
Jack,
I am pretty sure I can arrange for a special hour-long segment on the SGT Report, a highly regarded internet blog, with tens of thousands of listeners all over the globe, that would feature a debate between Ranting Andy Hoffman and Backwoods Jr. Let’s let truth fall where it will. Andy Hoffman is up to the challenge. Is your favorite number one son?
Here is the link to the SGT Report. Check it out. http://sgtreport.com/
Here is the link to some of the people he has had on his show (including Bob Chapman, Bix Weir, Jim Willie, Gerald Celente, Nomi Prins, James Turk, Lindsey Williams, Eric Sprott, David Morgan, and David Schectman, Andy Schectman and Andy Hoffman. http://sgtreport.com/category/interviews/
Since Backwoods, Jr. is Wall Street to the core, and so vocal that our viewpoint is off the wall, does he have the conviction to offer his views in a public forum? Andy doesn’t think so and frankly, neither do I. Let’s see if he is willing to debate Ranting Andy, fair and square on the economy. After all, you did email me that he disagrees with virtually everything we say and that he wanted to call and discuss it. You wrote, “Backwoods Jr. is eager to respond!! He will do so this afternoon and means no malice towards you or ranting Andy. Nothing illegal about a possible controversy. Agreeing to disagree on occasion should cause no harm. Sure, some egos might be flustered, but really no big deal unless blown out of proportion. Harry 3 has some 50 brokers spread out in every major business market in the US under his leadership and they would not agree with you on just about everything…” Here is his chance, and in the spotlight to boot. I will even do a link to SGTs YouTube interview in my newsletter, where another 20,000 people can hear “the other side” of the argument.
You say you want fair, honest discourse on these topics. Here is your chance. Does the Backwoods clan have the strength of conviction to bring this debate into the open? I hope BW Jr. takes us up on the offer so our readers can determine for themselves which position, Miles Franklin’s or Junior’s is full of hot air.
In the end, still your friend,
David
Finally, make sure to read Bill Holter’s two articles today. Don’t miss the Casey article on The Demise of the Petro Dollar. Some information is just simply more worthwhile than other information and Holter’s articles come under the label of Don’t Miss!
PS: Here again, note the 3:00 a.m. attack on gold in London. It’s Groundhog Day again and again.
(Miserable) State of the Union
Another Monday passed, another financial market “LOCKDOWN” in front of a blizzard of “events,” which I say in quotes because they will ALL be exacerbated dramatically by simultaneous, premeditated Cartel/QE/PPT/ESF manipulation to produce the desired psychological effect. Not that I am sure they will be successful in such efforts, particularly in the silver market which could do ANYTHING as Eric Sprott seeks to source ten million PHYSICAL ounces, but you can be sure PERCEPTION management, or as Jim Sinclair would call it, “MOPE,” will be front and center, to be discussed below.
Let start with today’s (Monday’s) PM market, where the Cartel was determined to invoke one of its cardinal rules, to NEVER allow gold, silver, and the mining shares to perform well simultaneously. Actually, scratch that, as the shares now appear unable to EVER perform well. You can bet that any time a minor negative piece of news comes out, such as mild dilution from Pan American’s proposed acquisition of Minefinders, and the Cartel will be there to double up the decline to make it look much worse. That is why KGC, NEM, and HL were obliterated in the past two weeks, and why PAAS was slaughtered 12% today.
Back to the aforementioned Cartel rule, silver had a big up Friday, and thus was not allowed to strongly rise today. Conversely, gold was held Friday to modest gains while silver soared more than 5%, so naturally silver was suppressed today while gold was strong. No matter that it had a major breakout Friday, or that copper and oil soared despite a flat stock market. Gold, as always, was held to its typical grinding, CAPPED gains – with each tick challenged – while silver was smashed down each time it attempted a sharp rally (yet still rose $0.15/oz).
As you can see below, gold was higher all night, until EXACTLY the COMEX open at 8:20 AM EST, and when it had the gall to attempt a post COMEX open rally, it was stopped cold for the day at – yep, you guessed it – EXACTLY 12:00 PM EST, the “cap of last resort.”
Notice below how yet again a sharp decline was stopped cold by the PPT, not coincidentally at EXACTLY 12:00 PM EST despite not a shred of material news (unless you consider endless Greek negotiation rumors to be “news”).
After 12:00, the Dow was walked higher for the rest of the day, so the “Dow / Gold x 2” algorithm in place all morning was shut off, so that gold couldn’t it recover its losses like the Dow. I’ve seen this tactic literally DOZENS of times over the years, particularly since GOVERNMENT ALGORITHMS took over the PM sector after “D-DAY,” November 9th, 2010. I’m literally in SHOCK that the PPT allowed the Dow to fall a whopping eleven points today, but no matter, the S&P was marginally UP.
In a nutshell, TPTB have taken over ALL financial markets, causing “complacency risk” to soar. I’m still incredulous as to how ANYONE can be complacent in light of the global financial collapse unfolding before our eyes, but when I see messages from people believing themselves to be “financially savvy” such as David Schectman’s alter ego, “Backwoods Jack,” I understand. Every time “BJ” opens his mouth on matters financial, he spouts the drivel of the masses, but what is expected of someone whose hobby is shooting squirrels?
Guest Post: Complacency Risk Is High
When “Jack” watches CNBC and Fox for self-validating PROPAGANDA, he is not shown the FACTS of the economy, let alone what he’d see by simply observing his surroundings. You know, inflation, unemployment, bailouts, welfare spending, exploding debt and deficits, and the inexorable decline of homes in his – and every American – neighborhood. But why care about the TRUTH when you can embrace LIES, which are so much easier to accept.
In a largely commoditized business, Miles Franklin stands out via its commitment to customer service, including client education to ensure they are informed of all factors affecting Precious Metals investments. David Schectman, Andy Schectman, and the Miles Franklin team believe strongly in the service we provide, including refutation of the relentless forces of ignorance.
Charting The US (Un)Recovery – Zero Hedge
I take pride in spending time sourcing esoteric movie clips to emphasize points, but this one is so easy, I feel embarrassed posting it. That said, “Jack” is wealthy enough to live comfortably, and thus can “handle the truth” more than most, which in turn could be used to help others to PROTECT THEMSELVES from the dangers closing in on them. I despise people like this, demonstrating the core selfishness of HUMAN NATURE that has brought America – and other parts of the supposedly “civilized world” – to the edge of ruin.
http://www.youtube.com/watch?v=MMzd40i8TfA
My job is to separate PROPAGANDA from REALITY, and shame on well-educated people like Backwoods Jack for perpetuating the world with ignorance, adding nothing to society whilst subtracting the same elements of character that made America great. To the contrary, not only is Tim Thomas of the Boston Bruins a world class goalie and Stanley Cup champion, but contributes to society by standing against the shrill babble of the ignorant masses, such as Backwoods Jack.
Boston Bruins Goaltender Releases Statement Explaining Absence From Obama Meeting
Of course, “BJ” is far from the worst society has to offer, as such ignorance is a dime a dozen in 21st Century America. Per the article below, you’d probably think I was citing Jonathan Lebed of the NIA as the worst offender, an arguably justified label given that he and NIA President Gerard Adams have forsaken the NIA credo of PROTECTING PEOPLE to pursue illicit profits as penny stock promoters. I cannot believe such apparently well-intentioned people, who have published some of the best economic work I have ever seen, have so quickly abandoned the NIA platform to bilk their doting readers, but then again, nothing surprises me anymore.
That said, the point I am making is that the writer of this article, “Timothy Sykes,” is perhaps WORSE than the NIA, attacking Lebed mercifully for being a penny stock promoter when he is doing EXACTLY the same thing. In fact, he is far worse, as per the language in the article, appears to be charging suckers for his penny stock advice, unlike the NIA which simply exploits the leverage of its large mailing list to move stocks.
Back to the post-PSLV silver surge, I thought you would appreciate the apparent breakdown of the uptrend in the gold/silver ratio, which has risen sharply since bottoming out at 32:1 the day before the “SUNDAY NIGHT PAPER SILVER MASSACRE” eight months ago. I cannot say what will happen in the short-run, but my bearishness on the gold/silver ratio is only matched by my bullishness on PHYSICAL gold and silver themselves!
And for those into “conspiracy theories,” an interesting coincidence regarding the timing of the Eastman Kodak bankruptcy last week. Apparently, EK consumes nearly as much silver each year as PSLV is sourcing with the $349 million of proceeds from its equity offering, which many – such as myself – believe may not be available despite what Sprott has been told. There will likely never be a way to connect these two events, but then again there was no way of connecting the “too early” sale of Warren Buffet’s 130 million ounces of silver in 2006, precisely when the fraudulent SLV ETF commenced operations with an inventory of – get this – 130 million ounces!
As for the perfect storm of typical Cartel “gold smashing events” necessary to impact investor PERCEPTION, this week’s “fearsome foursome” will tell us a lot of how strong the PHYSICAL market actually is, particularly with “ADMIRAL SPROTT” in the market sourcing ten million ounces. Today (Monday), we had the so-called “Greek debt negotiations deadline,” which for the umpteenth time failed.
The hyped “50% haircut” deal from late October has now degraded to proposals of 80%+ write-offs, to which I ask “what’s the point?” Greece, with its 450%+ sovereign yields, is beyond toast, yet somehow the global PPT has been able to delay the day of reckoning for a few months. Rest assured, Greece will return to the spotlight, the gods on Olympus frowning as the world’s first great civilization turns to ashes. And when it does, the FRENCH banks with huge exposure to Athens will be the first dominos to tumble.
Greek Debt Deal Rejected As S&P Begins European Bank Downgrades
On Tuesday night, we have the top PROPAGANDA speech on Earth from the biggest liar in America, the “(MISERABLE) STATE OF THE UNION,” followed by further dovish comments from the FOMC on Wednesday, another COMEX gold options expiration date on Thursday, and of course an uncontested, undebated $1.2 TRILLION increase in the U.S. national debt on Friday, to $16.4 TRILLION.
As for now (Monday night), it’s time to prepare dinner and watch a few hours of TV before tomorrow’s battle begins!
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Tuesday morning, and the same old, same old. I walked into the gym to see Dow Futures down a whopping 50 points, and despite having been up something like 19 of the last 20 days, Zero Hedge can’t help put out the same moronic “risk off” headlines, a ridiculous, amorphous catch-all phrase to explain any time any market goes down. As I watched the Dow / Gold x 2 algorithm in full force – wherein PAPER gold falls 2x the rate of any tweak down in Dow Futures, but rises at half the rate – I smirked at how good I have become at predicting the tick for tick action of these GOVERNMENT COMPUTERS in the thin pre-market PAPER action.
As has been the case during the past month’s market and media LOCKDOWN, very little news was discussed on financial websites and TV, no matter how bad. Apparently the “EU finance ministers” approved the European Stability Mechanism, or ESM treaty in a shady overnight vote reminiscent of the Christmas Eve 1913, sparsely-attended Congressional vote that ratified the unconstitutional Federal Reserve. Perfect timing, as due to the aforementioned global, mental LOCKDOWN, we could probably bomb Iran without drawing a significant media – or Dow Futures – reaction.
Guest Post: EU Finance Ministers Push Through ESM Treaty in Fishy Fly-by-Night Move
The big question, of course, is why such a hurry to empower the ESM (scheduled for July 2012) if it is completely toothless? Its predecessor, the largely impotent European Financial Stability Fund, or EFSF, was unable to leverage its limited funding, forcing the ECB to “save” Europe with pure MONEY PRINTING via its own “LTRO” mechanism and the Federal Reserve’s “swap facility,” downgraded by S&P before it even issued a cent of its own debt.
Of course there’s a reason, revealed in all its glory in the four-minute video embedded within the below link. In essence, the ESM is being utilized to commandeer Europe, much as the Federal Reserve has in the United States. Essentially, it concentrates financial power into the hands of a handful of centralized “elites,” mandated to act on the behalf of the ‘good of the continent,’ with ZERO input or regulation from individual nations.
Considering two former Goldman Sachs honchos were just installed – without election – as Prime Ministers in Italy and Greece, you can see what direction Europe is going. In other words, sovereign rights in Europe are about to go the way of States’ rights here in the U.S. – to the BANKERS. And with them, the voices – and wealth –of tens of millions of people.
The European Stability Mechanism (ESM) – A Treaty of Debt
Off topic, if I see one more article about Greece’s bleeping debt default negotiations, I’m going to seriously vomit. How the ISDA considers Greece – that of the 450% yielding government bonds, which have lost 70%+ of their value – to still be solvent, is beyond me. But then again, per the commentary above about the conspiracy to commandeer Europe’s finances, and global willingness to be lulled into mental LOCKDOWN, I guess nothing is impossible.
Of course, for how long can the markets, and people, remain quiet when their capital, livelihoods, and lives are being stolen from them?
S&P Warning Of Imminent Greek Default Again, But Promises All Shall Be Well, Dallara Speaks
As for gold’s absolute action this morning – as compared to its relative action via the Dow / Gold x 2 algorithm, not surprisingly we already have a 2-for-2 day. Up all night in Asia, then smashed at EXACTLY 3:00 AM EST while the Dow Futures barely budge, and again at EXACTLY the COMEX open at 8:20 AM EST. Then again, silver is only down $0.15 as I write this commentary, yet again THREATENING the Cartel’s best attempts to control market perception, care of “ADMIRAL SPROTT.”
As I noted earlier, between the tense Greek debt negotiations today, the (MISERABLE) State of the Union speech tonight, FOMC meeting tomorrow, COMEX options expiration Thursday, and $1.2 TRILLION debt ceiling increase Friday, the Cartel will likely be in rare form all week.
Particularly, keep your eyes on gold in the ensuing minutes following the Fed’s rate decision tomorrow at 2:15 PM EST. My guess is they say the same thing as always – i.e. rates at zero until at least mid-2013, continuing to examine stimulus options, etc. – and that gold is initially allowed to drift up to bring in suckers before a big PAPER attack. This is their most common post-FOMC tactic, utilized in the same manner as their oft post-NFP report attacks.
Don’t worry, I’m not concerned about lasting effects, just pointing out short-term Cartel tactics to expose them further. I hope I’m wrong, and very well could be given the explosive PM fundamentals and lurking economic dangers. Remember, this summer gold and silver SOARED while stock markets plummeted, asserting themselves as the SAFE HAVENS they have been for the past 5,000 years, and will be for the next 5,000.
PROTECT YOURSELF, and do it NOW!
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Nothing makes me happier than a RANT topic served up on a “silver platter,” and tonight’s State of the Union address provides the perfect fodder. No better way to draw attention than with shock value, so here’s a gem of a timely headline, care of the most useless, bloated, right-stealing agency in the U.S. – the TSA.
Rand Paul Detained In Nashville For Refusing Full Body Pat Down
Yes, an esteemed Senator is being held because the TSA won’t accept his word that he is not carrying a bomb in his pants leg, probably because his father is Ron Paul, by the way. The clownish U.S. government makes my job too easy, plumbing new depths each day, as it plunges faster toward its ultimate end, the “Davey Jones” locker of oppressive, bankrupt, ruling bodies.
Son of Ron Paul or not, I feel little sympathy for Rand Paul, who ultimately will be released, apologized to, and treated to additional privileges in his role of taxpayer-funded bureaucrat. As for “average Americans” not lucky enough to be Senators, not only do I sympathize with how the TSA is likely to treat YOU, but I may soon have to empathize as well.
As for the “State of the Union” itself, I am quite confident it has NEVER been worse, and sadly that today’s state of decline will shortly be remembered as the “good old days,” following the ultimate collapse in social, economic, and political equilibrium following the dollar’s loss of its “world’s reserve currency” status. Tonight’s annual PROPAGANDA report will be the same veritable puke-fest as always, a tribute to the art of flat-out LYING while an obviously bipartisan crowd cheers. Obama’s lucid “speechifying” is growing tired on the oppressed, distressed public, and simply saying “mark my words” or “you can take that to the bank” is falling on deaf ears, just as it did with George Bush and countless fraudulent “leaders” before them.
Per the below article, American’s state of “dissatisfaction” has never been higher, a TREND steadily worsening since the “U.S. peak” at the turn of the Century, care of the Greenspan-inspired MONEY PRINTING that brought us the doomed technology and real estate bubbles.
Per the chart below, we are talking about GARGANTUAN declines in all aspects of Americans’ views of their nation, from its financial strength (13% satisfaction compared to 68% in 2001), moral/ethical climate (28% satisfaction compared to 36% in 2001), and government growth (29% compared to 50% in 2001). These are extremely alarming trends, matched only by the rapid decline in Presidential approval ratings.
In last week’s RANT, “FIGHT NIGHT – RANTING ANDY,” I discussed the rapid deterioration of America’s “moral/ethical climate.” However, per the chart above, note that it was already at extremely low levels in 2001, as the rot of a welfare society with declining disciplinary standards has been wearing on this once great nation for some time.
As for Presidential approval ratings, it should be quite clear how easily they can be manipulated for short-term gain, despite the horrific long-term consequences of such actions. Note above the surge in Americans’ views of the nation’s “moral/ethical climate” and confidence in the “size and power of Federal government” in 2002, even while its views of the “state of the economy” plummeted, just before the U.S. unconstitutionally invaded Iraq under false pretenses.
Next take a look at the excellent graph in the below article, charting Presidential approval ratings over the past 65 years. Notice how the largest spikes occur when the nation ATTACKS other nations, including dropping the annihilation of Hiroshima and Nagasaki (Truman, 1945), Cuban Missile Crisis (Kennedy, 1962), Gulf of Tonkin Incident (Johnson, 1964), “Operation Desert Storm” (Bush I, 1990), and “Operation Iraqi Freedom” (Bush II, 2003).
How the Presidents Stack Up – WSJ
The “patriotism” engendered by military attacks – based on lies or reality – quickly wears off, and in the case of Vietnam and Iraq, the negative ramifications are often pervasive, enormous, and long-term in nature. Obama’s 49% approval rating has a long way to go before it hits the ALL-TIME LOW of 19% achieved by George Bush as he left office in 2008 (although it has been as low as 37%), but his 44% average approval in the third year of his presidency was the second lowest third-year rating since at least 1955, with only Jimmy Carter in 1979 below him on that notorious list.
Using deductive reasoning, it would be a pretty reasonable assumption that an attack on Iran, vilified for years as our mortal enemy despite having done nothing to earn that description, is being planned as we speak. I can only HOPE the American public wakes up to the EVIL being perpetrated on it by its leaders, but based on the alarming data above regarding public support of WAR, a decade of brainwashing that the Moslem religion is America’s “enemy,” Obama’s weak approval ratings, a nation in economic, political, and social turmoil, and an historic Presidential election upcoming in November, my HOPES are likely to be disappointed.
Gallup: Obama’s third-year approval ratings among lowest
As for tonight’s vile display of blatant deception from a puppet simpleton, commentated on by hordes of politically-biased dolts, on networks mandated to fool the masses in pushing their own selfish agendas, I will not be watching. I do not think there is anything I wouldn’t prefer to watching Obama speak, and hopefully you feel the same.
Moreover, I couldn’t be more certain he will espouse how great America is doing, with a few “our lord” references thrown in to convince people he is religious, or “folks” references to convince people he is one of them. Just as certain as gold’s attack tomorrow morning to “validate” Obama’s filth, yet another of the myriad events on the Cartel’s list as “must smash gold” events.
However, If there is ONE reason to watch him speak tonight, it would be to see – in person – how low the U.S. government has sunk, and how much lower it is on course to plunge. If that doesn’t inspire you to PROTECT YOURSELF from what’s coming, I don’t know what will!
We Are Moving Toward Hyperinflation
I have been thinking lately about how best to describe Ranting Andy Hoffman. I have decided that the term that best describes Andy is an “angry whistleblower” and the object of his anger is Wall Street, a place he knows well, having worked for many of the largest brokerages in the business for well over a decade. For those of you who are taken-aback by Andy, I suggest you re-think your position and give him credit for shining a light on the heartless, unethical, strictly profit-oriented polices that are executed to perfection by all of them. Bill Murphy calls them “The Bums.” I call them a disgrace – they have plunged a knife into the heart of the economy in order to walk away with obscene bonuses. They are true Sociopaths, with no empathy for those they lead down the road to ruin solely for a bigger payday. Their partners in crime reside in Washington DC, a place populated by many of the graduates of the large NYC “too-big-to-fail banks. They advise the President. They make policy from the halls of the Treasury Department. They work day and night – not for us, but for their buddies at JPMorgan and Goldman Sachs, and friends. How can this be? Because we have allowed it to happen, that’s how.
I say until John Corzine does some hard time for heading a firm that literally stole over a billion dollars of client’s funds, there is no justice – at least not for those at the top who spend millions to buy the favor of the Washington elite. Don’t hold your breath on the Corzine episode. He organizes $35,000 a plate fundraisers for Pres. Obama. He ain’t going ta jail! How about the CME – the billionaires who own the firm that controls the Chicago Board of Trade and the Comex. They make sure that the small fry (us) gets hosed while the bullion banks run roughshod over the markets. As our friend Chris Powell of GATA says, there are no free markets, only manipulations.
Steal a loaf of bread and go to prison. Steal a billion and get a $20 million dollar fine and get off scot-free – and with a huge profit. That’s the new American way.
And then there are people like Backwoods Jack who think it is un-American to complain. “Be proud to be an American,” he says, “Where else would you rather live?” Proud? That may have been true when I was a kid, but how can I be proud of the legacy my generation has left for our grandchildren? The middle class is decimated. There are very few good paying jobs waiting for our kids when they graduate college – and $100,000 or more in debt. Record numbers of our senior citizens are forced to live on food stamps, Social Security checks and Welfare. Because the banks are not paying enough interest, it is impossible for people, even wealthy people, to live off of CDs or bonds. You can thank the Fed and their “zero” interest rate policy for that. That forces them to buy annuities and long-term bonds that will turn into a disaster when, not if, interest rates rise and inflation dwarfs their interest payouts. That forces them to put their money into the stock market. How dangerous is that? Ask Richard Russell. He is as worried as I have seen him since 1987 and 2000, before the market crashed. He wants all of his subscribers out of the market, on the sidelines and only in cash and gold. We have allowed the banks to knock us to our knees. If you are one of the 5% or 10% at the top, be thankful, but for most Americans, the future will not be rosy. We have been warned, time and time again.
Thomas Jefferson, said:
If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around [the banks] will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.
I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale. –Thomas Jefferson to John Taylor, 1816.
Andrew Jackson said, referring to the Second Bank of the United States (aka our current Federal Reserve):
It is maintained by some that the bank is a means of executing the constitutional power “to coin money and regulate the value thereof.” Congress have established a mint to coin money and passed laws to regulate the value thereof. The money so coined, with its value so regulated, and such foreign coins as Congress may adopt are the only currency known to the Constitution. But if they have other power to regulate the currency, it was conferred to be exercised by themselves, and not to be transferred to a corporation. If the bank be established for that purpose, with a charter unalterable without its consent, Congress have parted with their power for a term of years, during which the Constitution is a dead letter. It is neither necessary nor proper to transfer its legislative power to such a bank, and therefore unconstitutional.
Dwight D. Eisenhower said:
In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists, and will persist.
Howard Buffet, father of the revered Warren Buffet said:
I warn you that politicians of both parties will oppose the restoration of gold, although they may outwardly seemingly favor it, unless you are willing to surrender your children and your country to galloping inflation, war and slavery then this cause demands your support, for if human liberty is to survive in America, we must win the battle to restore honest money. There is no more important challenge facing us than this issue — the restoration of your freedom to secure gold in exchange for the fruits of your labors.
And my generation didn’t heed the warnings. And look what we got!
Shame on us! And now, with the Patriot Act and other freedom-sapping laws and decrees, it is becoming dangerous to even talk about these things. That is why people like Bob Chapman, The Aden Sisters and Jim Willie write from outside of the US. Even Doug Casey is considering living outside of the US. I wonder how long it will be, before websites like ours are shut down?
I don’t have to do this for a living anymore. But I have a sincere desire to help as many people as I can to better themselves and to see what is really happening. Does that make me un-American? I don’t think so. If you were to ask Backwoods, he might disagree.
And I say to you, Backwoods Jack, I have no interest in leaving America. But when it comes to moving from Minneapolis to Miami for warmer weather, well, that’s another matter. I am proud to admit that Susan and I have become Snow Birds. Moving from Minneapolis to Miami for the winter doesn’t mean we don’t love Minneapolis anymore and calling attention to the problems facing our once-great nation doesn’t make us Un-American. Until more Americans take a stand and do something about the sad state of affairs here in America, things will not improve, they will only get worse.
Although I am not “political,” I still say – only Ron Paul (and he is not perfect) is talking about the important issues. What could possibly be more important than balancing the budget, bringing home our troops, honoring The Constitution and abolishing the Fed and honest money? It’s a shame he isn’t flashier and doesn’t project more charisma. On the other hand, Obama is all flash and no substance. Now a days, flash wins elections (Kennedy, Clinton, Obama). Gingrich is very bright, and an excellent debater but he will not do what has to be done to stop the hemorrhaging. Even if it is “a wasted vote,” I will proudly vote for Ron Paul. The better the showing he makes, the greater the (slim) odds are that eventually someone will take office that is “The Real Deal.” The media is biased against Paul and ignore him or brushes him off as having no chance of winning. The old guard politicians fear him and the big money banks and the Fed will never allow him to be elected, so his chances to become president are slim to none, and Slim left town. Too bad, because without his guidance, we will sink further into the abyss, regardless of who occupies the White House.
We are moving toward hyperinflation, if we do not address our annual deficits – in a serious way and immediately! In fact, it may even be too late at this point. Cutting a trillion or two over the next 10-years (as the National Debt continues to grow at over a trillion per year) is meaningless and even that pathetic goal seem out of reach. Anything short of a balanced budget and real debt REDUCTION is political garbage. If that causes a decade of pain, then so be it but at least we can tell our grandchildren we tried. Better a Depression now than Hyperinflation in a few years. Bob Chapman says we are headed toward BOTH. The big losers will be those of you on fixed incomes, like Social Security and pensions. Very few Americans will come through this mess without a great deal of pain and a serious reduction in our standard of living. Gold and silver will help, but even at the peak of this on-going bull market, I figure less than 5% or 10% of Americans will ever own enough precious metals to make a difference.
I hope you, our readers, who are not part of the clueless majority, will take action to protect your wealth with gold and silver. Not to do so will be the biggest mistake you ever make. Your money managers and financial advisors, who steer you elsewhere, will not be around to help you. They will be too busy asking themselves, “What the hell happened???” They will go down the drain along with those who take their advice and they will be too busy feeling bad for themselves to worry about you.
One of my favorite readers, Jeni, sent me the following email last night:
I just went to see my tax man and he said I was a gambler. He has all the arguments that Backwoods Jack has. I told him I owned a house and land and he wanted me to buy an annuity and stocks… Because he believes and quotes how gold and silver have gone nowhere though he bought gold at $350. I was in shock when I left.
I wrote Jeni back and said:
I’d get a new tax man! Anyone who could watch gold go from $350 to near $1,700 and tell you that you are a gambler is a FOOL! He is the gambler! He is gambling his future, and trying to get you to gamble yours with the belief that the dollar will not succumb to inflation and that interest rates will remain permanently low. What a fool!
Jeni knows better. She has been reading The Miles Franklin Report for a long, long time and she is a fan of Ranting Andy Hoffman.
Andy’s “Rants” are starting to rub off on me. And to that I say thank you Andy. Your passion and calling things as they are is a blessing (to those who listen).
PS: For those of you (are you listening, Backwoods?) who say, “What do David and Ranting Andy know?” I offer a few comments from that billionaire scoundrel George Soros:
George Soros: Collapsing US Economy to Spark Street Violence -(moneynews.com)
Monday, 23 Jan 2012 07:12 AM
By Forrest Jones
As the U.S. economy worsens, protests such as those carried out by the Occupy Wall Street movement will turn ugly, breaking down into waves of violent unrest across the nation, says billionaire financier George Soros.
“It will be an excuse for cracking down and using strong-arm tactics to maintain law and order, which, carried to an extreme, could bring about a repressive political system, a society where individual liberty is much more constrained, which would be a break with the tradition of the United States,” Soros tells Newsweek.
Unrest in the United States will serve as one of many symptoms of a worsening global economy, which makes wealth preservation a priority over getting rich.
“At times like these, survival is the most important thing,” Soros tells Newsweek.
“I am not here to cheer you up. The situation is about as serious and difficult as I’ve experienced in my career,” says Soros, made famous by betting against the pound in 1992 and pocketing $1 billion in the process, he said.
“We are facing an extremely difficult time, comparable in many ways to the 1930s, the Great Depression. We are facing now a general retrenchment in the developed world, which threatens to put us in a decade of more stagnation, or worse,” he said.
“The best-case scenario is a deflationary environment. The worst-case scenario is a collapse of the financial system.”
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TWO LESSONS
Lesson #1 – Why the U.S. was downgraded:
U.S. Tax revenue: $2,170,000,000,000.
Fed budget: $3,820,000,000,000.
New debt: $1,650,000,000,000.
National debt: $14,271,000,000,000.
Recent budget cuts: $ 38,500,000,000.
Let’s now remove 8 zeros and pretend it’s a household budget:
Annual family income: $21,700.
Money the family spent: $38,200.
New debt on the credit card: $16,500.
Outstanding balance on the credit card: $142,710.
Total budget cuts: $385.
Lesson #2 – Here’s another way to look at the Debt Ceiling:
Let’s say, you come home from work and find there has been a sewer backup in your neighborhood….and your home has sewage all the way up to your ceilings.
What do you think you should do?
Raise the Ceilings?
or
Pump out the sewage?
It is not economic weakness that drives gold prices higher. It is the policy response to that economic weakness. A weaker economy doesn’t necessarily mean that gold prices will go higher, but if this is going to be combated by aggressive Fed easing of monetary policy, such as quantitative easing, then gold prices will rise significantly.
U.S. “real” interest rates are an effective indicator for gold prices over the medium term.
Expect resistance at $1,680 and $1,700. If gold can overcome these levels, you can forget about the bears, like Larry Edelson. They will be off hibernating.
Interview with TraderStef and Ranting Andy Hoffman
Here is the link to the latest Gold & Silver Q&A with Andy Hoffman and TraderStef of StockTradersRoom.com:
January 18, 2012 – TraderStef and Ranting Andy Hoffman Interview
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