It’s amazing how “good” economic news – like Thursday’s GDP and Friday’s employment reports – miraculously emerges after the Fed announces indefinite QE continuation, isn’t it? To wit, going into such meetings, data is typically allowed to be seen for what it is; as amidst the complex game of propaganda, sometimes truth can be as effective as the lies written of this morning by Bill Holter. However, once the “no tapering” deed is done, economic lies typically return in full force – perpetuating the endless myth of economic “recovery.” You know, the one I disproved last week – which will never occur amidst the terminal stages of an historic fiat Ponzi scheme.
Of course, the GDP and NFP reports were as transparently flawed as three-legged dogs; and if not for ceaseless manipulation by the PPT and gold Cartel with nearly identical daily algorithms, it would be painfully evident just how endangered the nations finances are. Case in point is Friday’s post-NFP “market action”; in which the Dow didn’t budge until 90 minutes later, when the biggest consumer confidence plunge in two years was reported. And oh yeah, the nearly daily Federal Reserve “permanent open market operations” that inject cash into the market.
This is why the “dead ringer” trade pattern appears most every day – just as “the 2:15 AM” now does in the paper pm markets; in fact, on an incredible 112 of the past 124 trading days. Throw in the fact that interest rates rocketed higher Friday – i.e., the very factor that soured markets this summer; and you can see just how hard TPTB are working to mask reality. Worse yet, the moral hazard created by such reckless money printing and market manipulation is causing bubble-like characteristics to return – such as record margin debt, hedge-fund leverage, and equity valuations relative to underlying economic activity. Regarding the latter, it’s utterly scary how many such charts I can produce; in many cases, making the infamous internet bubble of 1999 look tame.
Depicting said manipulation graphically, here is how the Dow and gold have performed during the eleven NFP payroll days thus far this year; or as I have long called it, “Key Attack Event #1.” Yes, the Dow has cumulatively added 880 points this year on NFP days, while gold has added a big fat zero. And yet, as you can see, six of the eleven reports actually missed expectations; thus, proving my point of how politically important the “market reactions” to such data have become – in many ways, as important as the data itself.
Back to the data, it’s becoming increasingly difficult to hide the fact the real economy has not been this weak in our lifetimes; at least, for those born after the 1930s. Europe is collapsing; Japan is being hit simultaneously by economic, nuclear, and demographic freight trains; and America’s economic situation is rapidly degrading to second-world status – as reflected by the sorry state of its municipalities, such as Chicago, which today saw its rating downgraded by an incredible three notches. TPTB may have been able to temporarily “lasso” the stock and PM markets; however, any hope of “recovery” rests on maintaining record low interest rates; which despite the Fed’s best efforts, are rapidly rising. To wit, October housing traffic was the weakest in two years; and thus, the economy-killing impact of higher rates will truly be a sight to see.
Actually, the best measure I’ve seen of just how fragile the situation has become is the fact that amidst a so-called “recovery,” mortgage payments have risen dramatically faster than incomes. In fact, such payments have surged from 28% two years ago to 41% today; thus, negating any positive impacts from the recent decline in gasoline prices – and then some. Consequently, we’ve witnessed a record plunge in housing affordability; which, when combined with the fact that tens of millions will have health insurance premiums reset at dramatically higher levels over the next 12 months, makes it become painfully clear just how economically “screwed” the nation has become. Anyone still believe a new “housing boom” is upon us?
As for Friday’s NFP report, I would argue it was not only the most farcical, but disappointing to date. The labor participation rate experienced its third largest monthly decline ever – as a whopping 932,000 people dropped out of the labor force; and care of the tragic math it suggests, the Fed could theoretically reach its “taper target” of 6.5% unemployment simply due to plunging labor participation! I have written of this at length in the past, but you can now do the math with the handy-dandy unemployment rate calculator supplied by the government itself.
According to John Williams of Shadow Stats, the true U.S. unemployment rate reached a record high 23.5% in October – suggesting shades of the 1930s. This is why half of America is dependent on government entitlements – printed by the Fed – and why (unforgivable) student loans have skyrocketed from $115 billion before 2008’s Global Meltdown I, to $674 million today.
As for the title of today’s article, it relates to the top story that flashed all day Friday on the world’s top MSM economic cheerleader, Yahoo! Finance. Over the years, Yahoo has consistently done everything in its power to support TPTB’s economic propaganda – not surprisingly, about Precious Metals as well. However, they recently started to change their tune; as have other mainstream cheerleaders like Reuters and Bloomberg. At some point, posting outright lies eventually destroys credibility; and more importantly, ratings, as I wrote about last week.
And thus, when Yahoo! Finance hired Lauren Lyster earlier this year to tape video blogs – allowing interviews with the likes of, gasp, Peter Schiff and Gerald Celente, it was a clear sign of its intention to do a bit more reporting on reality. And what better way to make that point than last Friday, when the government reported supposedly “amazing” NFP payroll data; which in turn, “caused” the beloved Dow to surge to record (nominal) levels? To which I present Exhibit A; i.e., the headline read by millions of Yahoo! Finance readers all day Friday, and much of the weekend…
In other words, the entire world is slowly waking up to what the Miles Franklin Blog has stated for years; i.e., the real economy is inexorably declining, yielding the necessity of “QE to Infinity” to prevent instantaneous economic collapse. In other words, it’s one thing when “shadow worlders” like Michael Pento say it – as he did in this brilliant article this weekend; but a whole different ballgame when TBTF banks like Deutschebank do so as well. Heck, even the “vampire squid” itself – Goldman Sachs – admitted today that currency devaluation is the top priority of worldwide Central banks; such as the Reserve Bank of India, which appears to have a renewed Rupee plunge on its hands. Remember, any time the dollar “rises” in foreign exchange markets; it is simply the product of inflation being exported to nations not holding the world’s “reserve currency”; which is to say, all of them. This is what I wrote in last month’s “Most Important Article I’ve ever written”; and, in turn, what I anticipate will dominate financial headlines until the dollar is eventually stripped of this heavily undeserved, over-abused role.
Conversely, the propaganda campaign to kill Precious Metals sentiment, too, will in time die on the vine. There simply aren’t words to describe the blatancy and viciousness of this year’s 24/5 attacks on “paper pm Investments”; however, this article does as fine a job describing Cartel “psy ops” as any I’ve seen. In fact, according to King World News, we’ve actually reached the extreme levels of negative PM sentiment experienced at the June lows of $1,180/oz. and $18.50/oz., respectively; despite significant increases since, and unabated ZIRP and QE by essentially all major Central banks. Quite the manipulative accomplishment, if I do say so myself.
Unfortunately for TPTB, the fundamental reasons to own PMs have never been stronger; which is probably why global physical demand has never been stronger; and in all likelihood, will continue to rise in tandem with Central bank printing presses. Moreover, physical supply is approaching record levels of tightness – as this chart of COMEX registered inventories proves. Heck, even U.S. Mint sales of Silver Eagles are skyrocketing; and this, amidst extremely apathetic Western market conditions. And thus, my expanding belief that the Chinese themselves are buying up the U.S. Silver Eagle market!
The irreparable damage being done to the global economy by Federal Reserve-led money printing is truly historic. Not to mention, the Precious Metal mining industry; which in my view, will experience dramatic production declines in the coming year – just as supply is needed most. And thus, the historic opportunity to trade dying scrip for the generational purchasing power support of real money, at historically low prices. Only you can decide what’s right for your portfolio; something that must be considered ASAP, unless you’re part of the “0.1%.” However, keep in mind that when the MSM gets it, everyone else can’t be far behind.