The 150 or so people attending Miles Franklin’s “Q&A Rap Session” in Chicago Friday night saw me, working on 2½ hours of sleep, get choked up when describing the importance of Brexit; which last month, I deemed “the most important – and Precious Metals bullish – election in history.” And not just because in my view, it was history’s most globally relevant act of political defiance – in that 7.3 billion people will all be affected by the votes of a mere 30 million; but that it was done despite a manically intense “anti-leave” propaganda and market manipulation campaign. And equally importantly, my fervent belief that it marked the beginning of the end of the gold Cartel. I’ll get to the former topic momentarily; but first, given that my principal focus, as Marketing Director of one of the nation’s largest bullion dealers, is Precious Metals, I’ll discuss the latter.
To that end, consider that last weekend – when, before Brexit was even considered possible by the mainstream, an unfathomably bullish COMEX COT, or Commitment of Traders, report revealed that as of Tuesday the 14th, the “Commercials” (i.e., Cartel members like JP Morgan) had taken their naked gold short position to an all-time high level; and silver to nearly so; despite prices having recouped essentially all of their post “FOMC Minutes Attack” losses. When the report was first released last Friday (the 17th), I immediately penned “finally, the long-awaited Commercial Signal Failure is nigh”; regarding the potential imminence of the Cartel being “blown out of the water” by a the world’s “big money” smelling blood in the water; and consequently, seeking to take delivery of the minuscule amounts of inventory remaining in COMEX vaults.
When I subsequently saw this Friday’s report – discussed at length in this weekend’s “Brexit nightmare – what’s next?” article, I was 1,000x more confident that the Cartel’s upcoming demise; in that, as of Tuesday the 21st, said “Commercials” has MASSIVELY increased their already record level of gold shorts, and taken their silver shorts to nearly their all-time high level – before Brexit even occurred! In other words, before Brexit, it was already becoming clear that the COMEX Ponzi scheme was on its last legs. Let alone, after the Cartel’s desperately futile attempt try to hold PMs down post-Brexit, causing “open interest” to surge by a mind-boggling 60,000 contracts, worth $8 billion, which quite obviously caused said shorts to get MUCH larger. Not to mention, following today’s desperate, but as yet futile, attempts to hold prices down. And just wait until the COMEX actually opens!
To that end, the expected Central bank “policy response” to the, LOL, “unexpected” Brexit vote, was as shocking as it was “awe-ful.” As, starting with the Bank of England’s pledge to “commit” (i.e., print) $345 billion to support British stocks, bonds, and banks, dead in the water Central bankers went on an unprecedented money printing and market manipulation gambit. Which clearly didn’t work – as at $2.1 trillion, Friday’s global equity losses were more than on any day in stock market history. For example, the ECB “lent” $399 billion to Europe’s dying banks, an amount essentially equaling the entirety of the 2008 TARP bailout. And yet, the European bank stock index plummeted 13.5% anyway, marking its worst-ever daily decline; ominously, led by the world’s largest global derivatives purveyor, Deutsche Bank – i.e., the “Lehman of Europe.” Which, like countless other European banks, fell 20% on the day, to a new all-time low (I can’t even imagine how catastrophic the losses it’s derivatives book took!). Which, I might add, is down another 8% this morning, as its final, globally-consuming death spiral commences.
In fact, things are so bad this morning – this, after what was undoubtedly a weekend full of secret Central bank meetings, regarding how to manipulate markets today – that the entire British bank stock sector was halted midday, with stocks like Barclays and RBS down 10%-15%, and the British Pound and Euro free-falling toward multi-decade lows. For example, Shinzo Abe instructed Japans’ Finance Minister to watch currency markets “ever so closely,” and “take steps if necessary” toward the goal of “market stability.” Which ironically, means it will imminently take interest rates more negative, as the Yen – i.e., the “funding currency” of the globally destructive “carry trade” – is surging higher, counter to the Yen-destroying goals of 20 years of ZIRP, and ten of QE. As for China, the “cataclysmic, financial big bang to end all bangs“ – i.e, the massive, world-destroying Yuan devaluation I predicted last year – came one step closer to reality; as this morning, the PBOC devalued the Yuan by nearly 1%, to its lowest level in 5½ years, in a move whose scope was second only to those of the 6% devaluation over a week’s time last August.
Since this year’s worst-ever start to a year for global stock markets, I have vehemently warned that “the world will not get through 2016 without a cataclysmic financial event.” And my god, it’s arrived – in spades. Per today’s title, what I have long forecast is coming to fruition – as the politically, economically, and socially fragile European continent is collapsing before our eyes (wouldn’t it be a hoot if the Euro Cup final is Germany versus England?). Everywhere one looks, total chaos is evident, including…
1. David Cameron resigning as Prime Minister of the UK, yielding a chaotic power struggle within the opposition Labour Party
2. Scotland and Northern Ireland, which actually voted to “remain,” have been thrown into political chaos – with Scotland threatening to secede from the UK, and Northern Ireland proposing to reunite with its historical arch-enemy (not to mention, a card-carrying PIIG), Ireland
3. No less than eight other EU members have declared strong interest in having their own “leave” referendums; led by the now second and third largest members, France and Italy.
4. As I expected, the anti-Euro Podemos Party was the big winner in yesterday’s Spanish Parliamentary election; essentially, making Mariano Rajoy a lame-duck Prime Minister, and introducing the possibility that 37-year old, radically “anti-austerity” (read, “pro-default”) Pablo Iglesias will take his place.
5. Die Welt, Germany’s third largest newspaper, called for Angela Merkel’s resignation; as she, like Hillary Clinton – by association with the vehemently pro-remain Barack Obama – was eliminated from the post-Brexit political landscape as of Friday.
George Soros summed up the dire European situation perfectly, in espousing “the catastrophic scenario that many feared has materialized, making the disintegration of the EU practically irreversible. Britain eventually may or may not be relatively better off than other countries by leaving the EU, but its economy and people stand to suffer significantly in the short to medium term…and the implications for Europe could be far worse.”
However, none other than the grand architect of modern hyperinflation, “Maestro” Greenspan himself, intimated of the real problem. That is, following his ominous statement that “the euro currency is the immediate problem,” as “it’s failing.” In other words, his less articulated belief, via intimation, that Brexit is just the “tip of the iceberg” for the global financial system. Which is what I have been screaming from the rafters of for years, in discussing the inevitable end game of the global fiat Ponzi he led into existence nearly 30 years ago.
In other words, the global fiat cancer is in its terminal stage – as we speak, killing off dozens of currencies in real-time, and catalyzing explosive interest in escaping them for the time immemorial safety of the only substances to have served as money throughout history, physical gold and silver. Not to mention, the modern-day “twin destroyer” of the fiat regime, Bitcoin.
My friends, if the clarion call to PROTECT YOURSELF isn’t loudly blaring now – no matter where you live – I don’t know what will. As history’s largest, most destructive fiat Ponzi scheme is collapsing before our eyes – and quite soon, in my view, it will be too late to do so.