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It’s Thursday morning, and this will be my last article before the long holiday weekend. That said, there’ll be plenty to “study” over the next four days, care of this link to the entire, nearly three-hour proceedings of last week’s Houston “Q&A Rap Session” with myself and Miles Franklin’s President and Co-Founder, Andy Schectman – hosted by one of the true “good, smart people” in this business, Daniel Ameduri of Future Money Trends. In it, essentially every topic you can imagine is covered – all of it, with no strings attached. As was the case at previous sessions in Denver, Minneapolis, Phoenix, and Ft. Lauderdale; and will be so at our Chicago session on June 24th (email me at firstname.lastname@example.org if you’d like to attend).
As for today’s situation, never before has such a perfect storm of “PM-bullish, everything-else-bearish” news flow prevailed – amidst, care of historic market manipulation, record-high financial “asset” valuations, and record low valuations of real money. I mean, how much more blatant can it be that since last year’s “Eastern Point of No Return,” the Chinese government has been utilizing the “hail mary” algorithm to protect its markets?
…although it hasn’t yet learned how to execute the “dead ringer” algo, which is probably why the Shanghai Exchange is closer to multi-year lows than highs…
As for the gold Cartel, basking in its short-term, unequivocally “Pyhrric” victory, only a dolt can’t see how it’s “set up shop” at $1,230/oz – having utilized seven “Cartel Herald” algorithms in the past 28 hours alone to cap gold there, amongst a veritable blizzard of gold-bullish headlines.
For the record, in 14 years of gold watching, I have never seen the Cartel Herald algo in any market other than PMs – where it occurs every time gold or silver attempt to rise. And man, it’s uncanny how the 12:00 PM EST “cap of last resort” is used to quash burgeoning PM rallies; although in the past year, it’s been closer to 11:30 AM EST, as we saw in silver on Tuesday and Wednesday…
But don’t listen to “conspiracy theorists” like the Miles Franklin Blog. I mean, Deutschebank’s admission that it, along with a cadre of other “bullion banks,” suppressed gold and silver prices for the past 15 years must be a figment of our imagination. Or yesterday’s announcement that Citigroup is paying a $425 million fine for manipulating interest rates. Or yesterday’s U.S. Appellate Court ruling that 16 of the world’s largest banks can be civilly sued – for potentially, hundreds of billions of dollars – for manipulating LIBOR.
Or heck, Alan Greenspan’s 1998 admission that…
“Central banks stand ready to lease gold in increasing quantities should the price rise.”
Or then Bank of England governor Eddie George’s 2000 admission that, following gold’s post Washington Agreement spike from $255/oz to $310/oz…
“We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K.”
Or then Bank of International Settlements’ Economic Chief William White’s 2005 admission, via a speech to “central bankers and academics” at the BIS’s fourth annual conference – in a speech titled, LOL, “The Past and Future of Central Bank Co-operation” – that the “intermediate objectives of central bank co-operation” include…
“…the provision of international credits and joint efforts to influence asset prices, especially gold and foreign exchange, in circumstances where this might be thought useful.”
…as exemplified by this headline on Europe’s largest news service on December 7th, 2011 – i.e., “Operation PM Annihilation II”; at the Cartel’s time-tested “key attack time #1” of 10:00 AM EST, when gold spiked just after an “unexpected” ECB rate cut (which, after the gold smashing damage was done, was mysteriously retracted, without being confirmed or denied)…
“MNI NEWS via BLOOMBERG – Market sources report Bank of International Settlements, Bank of England, and Federal Reserve were selling gold after it popped to session high at GMT 1335.”
And by “gold smashing damage,” I mean this – catalyzed by, what do you know, the “Cartel Herald” algo. As clearly, the Cartel was desperate to prevent another run at $2,000/oz – and thus, drew an “historic” line in the sand at the key round number of $1,750/oz. But hey, I must be making all this up, as there’s no way a paper trading monstrosity like this could have any manipulative effect on the “price discovery” mechanism.
But I digress, as the aftermath of last week’s “FOMC Minutes Attack” has my dander up. Clearly, the “powers that be” are closer than ever to losing control – and unquestionably, said “attack” will only make a world already buying Precious Metals at record levels that much more likely to add to their positions. And inevitably, end the “New York Gold Pool’s” tyrranical reign, like the “London Gold Pool” before it.
That said, it’s not just physical supply and demand that’s working against them, but the inexorable advancement of “Economic Mother Nature” and the “unstoppable tsunami of reality.” Today’s miserable Tiffany’s and Costco sales figures, for instance; or the CEO of McDonald’s stating that Obama’s insane, vote-pandering gambit to raise the minimum wage will cause “McAdee’s” to build job-destroying robots; or French labor unions shutting down 19 nuclear power plants, in search of more free money; or the currency of Nigeria – the most populous nation in Africa – on the verge of collapse; or the U.S. launching massive steel import tariffs against China; or this week’s near-recessionary PMI manufacturing and service indices; or massive demand for the Treasury’s 2- and 5-year Treasury auctions, despite the June “rate hike” the Fed is supposedly considering; or the utter explosion of health insurance costs, which will worsen dramatically due to America’s – and the entire Western world’s – hideous demographic tragedy unfolds.
However, what really garnered my attention in the past 24 hours was the seemingly endless sea of stories about corporations, municipalities, and sovereign nations desiring – or in desperate need of – bailouts. Yes, “bailouts” – which in layman’s terms, mean stealing from innocent bystanders, like us, to fund profligate or fraudulent enterprises or governments, via either taxation or the printing press. Or heck, our own bank deposits, now that most Western nations have adopted “bail-in” protocols (why anyone would keep significant funds in the insolvent, criminal, zero interest paying banking system is beyond me).
This week alone, the “U.S. territory” of Puerto Rico was quietly “bailed out” by Congress – further solidifying its $70 billion of unpayable debt as U.S. citizens’ ultimate obligation. And yet, Congress is simultaneously debating a bill to prevent actual U.S. States from being bailed out – many of which, like Illinois, California, and New Jersey, as well as many of the municipalities within them – desperately need them, or will so in the future. And don’t forget the Central States Pension Fund, which is on the verge of cutting benefits to hundreds of thousands of blue collar workers, due to the insolvency caused by eight years of zero interest rate policy. Which, I assure you, is just the “tip of the iceberg” for countless pension plans, insurance companies, and other organizations dependent on fixed income to survive.
Across the pond, Greece was supposedly “bailed out” again – to the chagrin of the majority of citizens, who a year ago voted against such “help”; not to mention, the IMF, which says it wants no part of it. Meanwhile, Swiss citizens will next week vote on the “Unconditional Basic Income” referendum; i.e., whether the government should “bail them out” from the monstrous inflation the “conservative” Swiss National Bank has wrought – by selling the nation’s gold, printing trillions of Francs, and pegging them to the dying Euro. And in Japan, alas, none other than Bill Gross opines that the Bank of Japan – i.e., a de facto government agency – should buy up whatever Japanese government bonds it doesn’t yet own, and “forgive” the governments obligations. In other words, allow it(self) to default. This, from the “Bond King” himself!
My friends, I hope that whilst enjoying the long holiday weekend – at least here in the States – you ponder just how close the world at large is to its inevitable “Jimmy Shaker Day.” That is, when decades of stupidity, arrogance, and profligacy come home to roost – with no ability to “bail itself out.” In much of the world, this has already occurred – but if you’re one of the lucky few, living in places where you can still proactively prepare for a bleak economic (and political) future, I sincerely hope you’ll use this once-in-a-lifetime opportunity to “bail yourself out,” whilst you still can.
Financial Survival Network
Where’s it all going Wednesdays with Andrew Hoffman:
– China devalues Yuan below August lows last night
– Ongoing economic deterioration worldwide, and now currencies declining anew
– Major upcoming events: June 2nd OPEC meeting, June 15th FOMC meeting, June 23rd BrExit Referendum, etc.
Today, I’m going to demonstrate, in spades, why the Miles Franklin Blog is such a valuable, FREE resource – and consequently, why “all bullion dealers are not commodities.” I try to do this every day, and this October, will mark my five-year anniversary at Miles Franklin. However, it’s in “times of need” like today – when “the powers that be” are doing their best to prevent you from protecting themselves from the death of the historically destructive monetary paradigm they themselves created – when truth tellers like us are of maximum value. Not to mention, that when purchasing, selling, or storing bullion – as with anything in life – “you get what you pay for.”
Unfortunately, the Cartel “won” the current battle for short-term price control – in finally, with the aid of a lie as egregious as the “we killed bin Laden” card utilized to quell the 2011 silver price spike (i.e., June “rate hike” propaganda) – getting perpetually stupid COMEX “specs” to pitch their positions, causing the Precious Metal bull market to “correct.” This, amidst the most “PM bullish, everything-else-bearish” news flow to date. To that end, someone I have great respect for just wrote an extremely cynical article of the past week’s proceedings, titled the “end of the Precious Metal fake rally” – opining that we have returned to the PM “hostage market” of the past five years.
In my view, he is failing to see the forest through the trees – as the unequivocally modest price declines were achieved at great intermediate-term cost. For one, the prices of both gold and silver are now far closer to “oversold” than “overbought” – and this, with neither having come close to their 200 day moving averages of $1,162/oz and $15.18/oz, respectively. Heck, even after this week’s monstrous Cartel raid, they are barely below their 50 day moving averages of $1,251/oz and $16.25/oz, respectively.
More importantly, in the bigger picture, such blatant machinations have exposed their desperation to the entire world – in taking their unquestionably “naked” shorts to all-time high levels, despite dollar-priced gold and silver prices having barely risen off their bear market lows. And the reason I say “dollar-priced” gold and silver – per the title of a 2012 article of the same name – is that just no more than 10% of the global population utilizes dollars as their primary currency; as opposed to the “other 90%,” who use currencies that have devalued far more dramatically since the system broke in 2008. To that end, my friend Paul Brodsky wrote today of how the monetary system, care of ZIRP, NIRP, and QE, has been diluted by an incredible 47% since then – which is probably why gold has been the world’s best investment of the past decade; and why institutional PM demand has finally returned.
More importantly, what has been the physical cost of this reckless paper gambit – in igniting record gold and silver demand, atop levels that were already at all-time highs? Which is no more obviously witnessed than in the historically tight physical silver market; starting with the U.S. Mint itself – which, despite unprecedented rationing, is on a pace to sell 22% more Silver Eagles than last year’s record amount…
…and the Royal Canadian Mint, whose data is published with a one quarter lag, but purports a projected 2016 sales level (of Silver Maple Leafs) 24% above 2015’s record level; including 11% above the third quarter of 2015, during which, the retail bullion industry experienced its most acute silver shortage since the 2008 financial crisis…
Of course, gold and silver are just the “sideshow” to the “main event” of the collapse of history’s largest, most destructive fiat Ponzi scheme – as starkly evidenced by the renewed plunge of most global currencies. Which, I might add, accelerated significantly when the Fed was stupid enough to pretend it might raise interest rates in June. But nowhere more so than in the center of the historic economic bubble – CHINA – where last night, the PBOC, as I predicted, took the Yuan/dollar exchange rate below the August 2015 lows; i.e., the initial stage of the cataclysmic devaluation that is just getting started.
The Yuan/dollar – and now that the PBOC is targeting other currencies as well, the Yuan relative to the IMF’s “strategic currency basket” – is the epicenter of the final, thermonuclear battle of the “final currency war.” For those who haven’t been watching, the PBOC has been quietly devaluing the Yuan for several weeks now, in response to its collapsing export market. However, since the Fed was dumb enough to unleash last week’s anti-gold propaganda offensive, the PBOC has “stepped up” the devaluation, as highlighted by pushing the Yuan/dollar exchange rate below the August lows last night. To that end, the more the Fed plays this “losing card” – which will undoubtedly “come to a head” at the June 15th FOMC meeting – the more it risks a market de-stabilizing, and Precious Metal-bullish, currency shock. Which will come anyway, likely sooner rather than later, irrespective of what the Fed does next month.
Of course, the bigger issue is not the short-term movement of financial markets – unless of course, they significantly “de-stabilize” – but the longer-term destruction of global economic activity, living standards, and social stability. When reading this article, for instance, describing just how much of a failure 25 years of Japanese monetary policy easing has been; and seeing the below chart of the horrific economic fate of American millennials; it’s difficult to ignore the terrifying political and economic changes that are coming. Exponentially rising money printing – not to mention, historically ominous demographics – are causing a parabolic, worldwide surge in the cost of living, which will only worsen as the fiat currency paradigm completes its terminal stage.
Thus, for those worried that the Cartel will be able to drive Precious Metal prices back down to their lows – and “kick the can” several more years – I would advise you to sit back, take a deep breath, and look around you, no matter where you live. Nothing’s “easy” about the death of a global paradigm – particularly when said paradigm will result in the greatest political, economic, and social changes in generations, none for the better. Not to mention, the greatest “wealth transfer” – from unbacked paper, to real physical assets – in history.
Long-time readers know I “cut my teeth” in the Precious Metals sector as a daily contributor, circa 2003-10, to the GATA website; then, as now, for free. GATA, led by the indomitable Bull Murphy and Chris Powell, has not only been a shining beacon of truth for nearly two decades, but started the movement to expose the hideous, illegal suppression that has irreversibly harmed Precious Metal investors, miners, and the global economy at large. Through GATA, I have made more good friends, and close colleagues, than any other organization in my 25-year professional career – including Andy and David Schectman, who “discovered” me there. Many are “household names” in the Precious Metal community; and unquestionably, a highlight of my life was being specifically praised by “Admiral Sprott” at the 2011 GATA conference in London, where he was the keynote speaker.
I’ve been through thick and thin with this group, many of whom are still active contributors to the cause. And amongst my fondest “GATA memories” are the annual “MOTY” awards put together by the late, great Adrian Douglas, to “salute” those who most egregiously circumvent Precious Metals truth. I’ll let you research what it stands for; but let’s just say it’s not a compliment – as exemplified by the two “winners” I can recall, Dennis Gartman and Jeffrey Christian. Hey, everyone’s entitled to their opinion – but when “opinion” treads on fact, you’re fair game in the court of public opinion. And particularly in the “long and strong” Precious Metal community, which is forced to endure more lies, propaganda, and misinformation than any in the history of investing.
Fast forward to today, where truth warriors like GATA – and the Miles Franklin Blog -continue to rail against those whose agendas don’t necessarily gibe with the dissemination of pure, unadulterated truth. And never more so in the gold and silver pits, where the war between monetary reality and those attempting to promulgate history’s largest, most destructive fiat Ponzi scheme is amidst an offensive as “economically bloody” as Antietam, Somme, Stalingrad, “the Bulge,” and Huế combined. Which ultimately, will turn out as successfully for gold bulls as the rebels at Yorktown, and as miserably for the “powers that be” as Napoleon at Waterloo.
Unfortunately, it’s “insiders” that typically inflict the most damage to the cause – for a range of reasons ranging from the obvious to the opaque. I’m not here to philosophize on such trivialities, or to single out individuals whose “work” is detrimental to our just – and most importantly, winning - cause. However, I think it’s constructive to bring to your attention a “MOTY-worthy” headline yesterday – per above, from a PM “insider” – who suggested yesterday’s gold weakness was due to a “lack of fresh, bullish news.”
Considering the source, I was not surprised, as it emanated from an organization which, contrary to its mission statement, has been decidedly anti-gold from the day I came across it 14 years ago. In fact, its previous “face of the firm” was nominated for multiple “MOTY” awards himself; and likely, was its “winner” on at least one occasion. However, even for me, who has seen every imaginable method to smear Precious Metals since becoming a devotee in 2002, this headline affected me to the core.
The reason being, that anyone with even a modicum of experience in financial markets – let alone, heavily manipulated ones like “futures” markets; which the CME, operator of the COMEX, all but admitted to yesterday – knows “fresh, bullish news” is not required to sustain prices on a daily basis. To that end, I didn’t realize there was a “statute of limitations” on good news; which fallaciously assumes that any news that emerges, good or bad, is immediately, instantaneously discounted into prices. Conversely, government-supported markets like the “Dow Jones Propaganda Average”; U.S. Treasury bonds; and recently, crude oil, arent’ “allowed” to decline even when “fresh, bearish news” emerges, even when it showers us on a 24/7 basis. Not even when such markets have historically weak fundamentals and high valuations – as opposed to gold and silver, which have historically strong fundamentals, and low valuations. Heck, the “next Lehman” itself, Deutschebank – which last month, admitted to illegally suppressing Precious Metal prices – had its credit rating downgraded this morning by Moody’s, for the second time this year, to just two notches above junk. And yet, it’s stock price is up!
Regarding the “lack of fresh, (gold) bullish news,” this inane description of the day’s events – ignoring the tell-tale Cartel algorithms that “manage” PM trading every day, week, and month – it apparently did not consider the very factors I was simultaneously discussing, such as “a recessionary cliff-dive of Japanese PMI, export, and import data…plummeting Chinese credit creation… and the lowest European PMI reading in 16 months.” And this, before the “unexpectedly” weak U.S. manufacturing PMI reading of 50.5 was published; i.e., its lowest reading since 2009, featuring these quotes from Markit, the organization that published it…
“The survey is signaling that manufacturing will act as a drag on economic growth in the second quarter, leaving the economy once again dependent on the service sector, and consumers in particular, to sustain growth.”
“Output is falling for the first time since the height of the global financial crisis, with factories hit by slowing growth of order books and falling exports.”
“Backlogs of work are also dropping at the fastest rate since the recession, meaning firms will be poised to cut capacity unless inflows of new work start to pick up again.”
“The survey’s employment gauge is in fact already running at a level consistent with a further reduction in the official measure of factory payroll numbers.
“Any uplift in prices was largely due to higher commodity prices, notably oil. Core price pressures look to have been once again subdued by weak demand.”
Surely, this is “fresh, bullish news” for gold – given that the self-admittedly “data dependent” Fed said it would only raise rates in June, if incoming data suggests a pickup in economic activity. Heck, even San Francisco Fed President John Williams, who last week was tasked with starting “Operation June Rate Hike Propaganda Storm” a week ago, at a press conference yesterday, said this when asked about the Fed’s June intentions…
“I don’t know what we’ll do.”
Let’s face it, what’s going on now – into this morning, as the Cartel’s “Sasquatchian footsteps” couldn’t be more evident – is the long-awaited liquidation of speculative positions in the paper markets; as sadly, the “commercials” did in fact win this battle, en route to the aforementioned Waterloo that awaits them. That said, those holding physical metal as long-term savings – as protection, and insurance, against the mathematically certain collapse of fiat currencies worldwide – didn’t “lose” anything this week, other than their tempers, at watching the Cartel again gain the short-term upper hand. Moreover, the lower prices caused by the “FOMC Minutes attack,” and subsequent paper liquidation, will only cause demand for actual, physical demand to rise; yet again, shortening the timeline of inevitable Cartel destruction, and liberation of economic suppression worldwide. Hopefully, you will not look this gift horse in the mouth!
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Sadly, it couldn’t be more obvious where things are going, both in the short- and intermediate-term. As I sit here early Monday morning, reading reports of a recessionary cliff-dive of Japanese PMI, exports, and imports – whilst, LOL, the Yen ominously surges; as well, reports of plummeting Chinese credit creation; and the lowest European PMI reading in 16 months; I can’t help considering how close we are to a total loss of the “powers that be’s” control over financial markets.
Also in the news, Greece’s traitorous Parliament – incredibly – voting for dramatically higher, across-the-board taxes on its predominately anti-austerity citizenry, to “unlock” €10 billion of “bailout” funds to pay off the Troika next month, amidst an unpayable repayment scheme scheduled for (at least) 43 years. Throw in a report that a British “Lord” insists Britons should simply work into their 70s if they can’t afford retirement, and you can see how far down the road to serfdom the world has come. Not to mention, the increasing level of disenfranchisement with the fraudulent monetary system that caused this economic monstrosity – as evidenced by record worldwide Precious Metals demand; and heck, the birth of Bitcoin.
When these topics are considered cumulatively, it’s difficult to not believe what Bix Weir says about a system intent on destroying itself – particularly when a psychotic gambit like last week’s FOMC minutes propaganda (and associated Precious Metals attack) is perpetrated; suggesting the Fed is considering what would amount to economic and financial market suicide. Let alone, ahead of potentially market-shaking events in the coming weeks – from the June 2nd OPEC meeting, to Switzerland’s June 5th “Basic Income” referendum; to the June 23rd “BrExit” vote; and if Syriza doesn’t get what it wishes – against the wishes of the majority of Hellenic citizens – a Greek default in July.
Not that the Fed are actually going to do anything, of course. However, simply intimating they “could” raise rates amidst the worst economic environment in decades – “recovery” notwithstanding; much less, with financial markets already rolling over; leaves one wondering if the inmates are truly running the asylum. And frankly, given how we have seen multiple, major shortages in physical silver in recent years – including last summer, when Miles Franklin had its three busiest months ever – it’s difficult to believe the Cartel’s current, unfathomably brazen attempt to quell surging “paper prices” won’t catalyze a physical market panic. It’s only a matter of time – and with what may be the most dramatic, nation-changing election in U.S. history less than six months away, nothing would surprise me at this point. Fortunately, the one thing I KNOW, rather than believe, is that the purchasing power of physical gold and silver – and likely, platinum as well – will increase by many multiples as the collapse of history’s largest, most destructive fiat currency Ponzi scheme inevitably unfolds.
To that end, a terrifying topic I have discussed for some time – along with many things previously considered “impossible” – is slowly creeping into the mainstream. Which is, the inevitable result of overpopulation, monetary inflation, and the resulting economic “deformation.” I.e., the explosion of government size and scope, which always accompanies mass financial hardship. Which, whether officially termed socialism, fascism, or the “nanny state,” are, in reality, various forms of communism. Or, by definition, public ownership of all property and enterprise.
In some places, Communism is already official policy, as in Russia. Whilst others, like China, pretend they are capitalist, when in fact the government, in some way, shape, or form, either owns or operates all corporations. Still others are blatant socialists, like Canada and essentially all of Europe; whilst in “capitalist” nations like the U.S., the line is being increasingly blurred by the explosion of entitlements, regulations, taxation, Central bank “monetization,” and corporate cronyism. Sadly, the common denominator is that throughout history, “big government” has been the end result of economic collapse. Meaning that, no matter where one looks today, the trend toward the “ultimate end game” of communism is not just evident, but starkly so.
In recent weeks, a handful of blaring warnings of what’s to come have emerged – not uncoincidentally, as financial markets have started to decline anew, starting with the shocking news that due to unbridled “equity QE,” the Bank of Japan is now a “top ten holder” of more than 90% of Japanese stocks. In other words, the government that “owns” the BOJ, is on the verge of owning the vast majority of Japanese companies. I.e., communism.
Worse yet, was this weekend’s news that the Chinese government’s recent “proposal” to “assume” trillions of bad debts in exchange for corporate equity – debts, which ironically, were created by their own “social financing” policies – has been ongoing, en masse, for months. To wit, roughly $220 billion of debt-for-equity conversions have already occurred, destroying whatever remaining semblance of “capitalism” the new Red Ponzi scheme purported to create.
That said, it’s not China where the “switch” to Communism will make headlines – given that capitalism never really existed. Frankly, the only real “capitalistic policy” in China was pretending as much, to sucker enable Western capital inflows, under the false belief they’d be able to take it out. No, the real carnage will be seen in the Western world – as “first world” economies like Europe and Japan more still further to the left, whilst the “world’s most capitalist nation,” the U.S., moves overtly to full-blown socialism, en route to outright communism. Think I’m crazy? Than pray tell, how can more than half of all American’s receive entitlements during a “recovery?” And what exactly is Obamacare?
And if you think the current, hopelessly unfunded “entitlement nation” environment is bad, consider that, care of eight years of NIRP, QE, and other unnatural, manipulative policies, the vast majority of American pension funds, insurance companies, municipalities, and States are either insolvent, or on an irreversible path towards such. Not to mention, the very banks that were supposed to “benefit” from negative interest rates – like the “next Lehman” itself, Deutschebank. Which, in reality, have not “benefited” a whit from the Fed’s free money. But instead, from the rigging of financial markets by the Fed, PPT, Exchange Stabilization Fund, and other manipulation operatives; which they not only are privy to, but a part of.
I mean, do you think it’s a “coincidence” that after centuries of at best making money on 51% of all trading days, today’s “TBTF” banks do so nearly 100% of the time? That said, the losses from dying loan portfolios and misguided “derivative” bets quite obviously trump said “trading profits” – which is why Central banks continue to keep interest rates at zero (or below); continue to “monetize” assets; and continue to protect banks’ interests – and perceived solvency – at every possible turn. Such as, of course, suppressing Precious Metals prices – the “canary in the coal mine” that, if unchecked, exposes the collapsing system for the financial carcass it is.
In my view, a whole slew of catastrophic, inter-related “end games” are coalescing in the very near-term term, with the exploding trends towards global socialism, fascism, and communism exposing the chronic monetary disease for what it truly is. Which will clearly lead to most of the world experiencing the most challenging political, economic, and social conditions in memory. Which fortunately, for those living in markets where supplies are still available, can be at least partially mitigated by ownership of the only real money the world has ever known.
If ever there was a day I didn’t want to write, it’s today. After all, this was one of the most mentally exhausting weeks I can remember – culminating with Wednesday and Thursdays’ “FOMC Minutes Attack”; after which, I scripted an epic 42-minutes Audioblog – which must be listened to, as “the pathetically desperate FOMC Minutes Attack will miserably fail” discusses everything you need to know about what really happened, and what really went on behind the scenes.
Immediately afterwards, I flew to Houston for last night’s Q&A Rap Session; which in my view, was the best Andy Schectman and I have put on to date – in large part due to the fantastic emceeing of our good friend Daniel Ameduri of Future Money Trends. Fortunately, we had the event professionally recorded, so I expect it to be uploaded to the blog within days – if not, by the time you read this. And thus, here on Saturday morning, as I sit at the Houston airport awaiting my flight home to Denver, I’m thinking of how mentally (and physically) tired I am; and what fate awaits the financial markets – and world – in the coming weeks and months.
As I scan the list of “horrible headlines” I’ve gathered in the past 48 hours, I as usual see countless article-worthy topics. However, the over-arching theme I’m focusing on is that “the powers that be” have never been close to losing control entirely – which inevitably, must happen in the unprecedently manipulated Western world, just as it already has nearly everywhere else. And by “powers that be,” I don’t mean a small group of “elites” planning the fate of the world; but to the contrary, unassociated groups of political, monetary, and corporate leaders in the world’s strongest economic nations. Or more aptly put, those with the most powerful printing presses. Each of these groups have similar goals – of maintaining a status quo in which printing presses enable wealth and power for the 1% running them. Although I assure you, the amount of “collusion” amongst such groups is little to none. As unfortunately, currency wars are zero sum games, in which for every “winner” (LOL), there’s a loser, or losers.
As I consider what happened this week – as discussed in great detail in the aforementioned Audioblog – it’s hard to view it as anything other than a desperate attempt to bail out the increasingly vulnerable “commercial” shorts – on the COMEX, and other paper markets – as the burgeoning forces of economic reality threaten to overwhelm them. It happened five years ago, when said “commercials” were forced to cover shorts into an exploding silver price – to the point that, if not for the last ditch “Sunday Night Paper Silver Massacre” on May 1st, 2011, the Cartel would have died then and there. And it unquestionably will again; only this time, demand is dramatically higher, supply significantly lower, inventories severely compromised, and money printing so massive, there’s essentially no chance that the resulting, inevitable short squeeze will be reversible. I mean, think about it, we’re talking about record gold and silver short positions, with prices far closer to multi-year lows, than highs!
Yes, that’s how one defines desperation. And this week’s comically transparent attempt to fabricate a “PM-bearish” catalyst from the ether – by LOL, propagandizing the Fed is about to tighten policy, amidst the ugliest imaginable headwinds, was undeniably the height of desperation. Let alone, as the last time they raised rates, in December, not only did global financial markets collapse, but gold and silver prices surged. In other words, even at just $1,250/oz and $17/oz, respectively – with Precious Metals sentiment barely registering compared the sky-high levels of 2011 – the Cartel is deathly afraid of losing control. As when they do, the destruction their unprecedented money printing has wrought on Main Street, will unquestionably have a “multiplier effect” on the distorted, manipulated financial markets – which have caused most financial assets to trade at their most overvalued levels ever; whilst conversely, suppressed real money markets have never been more undervalued.
To that end, the perfect case in point is the fact that by promulgating the lie that the Fed is considering a June rate increase, it has – as in December – pinned itself into a corner. In other words, putting the “ultimate Hobson’s Choice” on their plate; as if they are actually dumb enough to do so – amidst political, economic, and financial market conditions far direr than in December – they will undoubtedly ignite a major market crash; likely, of not only stocks, but high-yield bonds, commodities, and currencies. Which in many ways, is already occurring, before said “rate hike” has even been formally discussed.
Conversely, if they don’t raise rates June 15th – which even now, the money markets decidedly don’ anticipate (particularly as the “Brexit” vote is scheduled for eight days later), they risk an utter explosion in Precious Metal markets that were already on the cusp of breaking out. Let alone, if the Brexit referendum actually passes. Only this time, the only remaining “trepidation” amongst PM investors will be eliminated – as if the Fed doesn’t raise rates now, after intimating they were heavily considering doing so, the odds of dramatic breakouts above $1,300/oz and $18/oz, respectively, will be as close to 100% as can be.
Of course, when rats are trapped on a sinking ship – and scurrying for cover – every move they make becomes a Hobson’s Choice. In other words, damned if they do, and damned if they don’t. And by “damned,” I mean that Precious Metals demand will surge – whilst supply declines – no matter what they do. And when the resulting imbalance inevitably – perhaps, imminently – goes past the point of no return, not only will the “New York Gold Pool” be permanently destroyed, but any semblance of hope that “control” can be retained. At which point, you had better have already protected yourselves from what’s coming!
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