I have watched every tick of the Precious Metals market for 14½ years,
since the fateful day in May 2002 when I bought my first 100 shares of
Newmont Mining, en route to putting essentially all of my liquid assets into
the sector. Frankly, the 1% position I have taken in Bitcoin is as
exciting as any development in my investment career – as until Bitcoin, I
have not come across any asset class since 2002 worth investing in. And
by investing, I mean the classical definition of such, not today’s
bastardized concept of speculating in overvalued assets based on the
expectation of what Central banks and government manipulation operatives
might do. To borrow from Richard Russell’s lingo, I take big positions
in primary trends I deem to have extremely high return/risk
profiles. And the more confident I am in such a trend, the more I
invest. Hence, my 1% position in Bitcoin, versus 90% in physical
Precious Metals.
To that end, while I am highly confident that cryptocurrency will dominate
the monetary future, the road to that end will be very rocky. In other
words, I’m not sure Bitcoin itself, in its current form, will
dominate the future monetary landscape – although at the least, its unique
characteristics, and dominant first mover advantage, make it highly likely to
serve as a store of value. Conversely, 5,000 years of history – versus
seven for Bitcoin; including the world’s biggest money aggressively
accumulating now, tells me the risk/reward profile of physical
Precious Metals is as powerful as anything I’ve experienced in my
career. That, and the fact that prices have been blatantly suppressed
below their true values – by governments so desperate to maintain the dying
status quo, they will sacrifice the future of the human race in the quest of
kicking the can a few more inches, down a road in which the “monetary wall,”
stronger and more unyielding than any in history, stands right in front of
them.
To that end, my 14½ years of PM experience – during which, I have
inarguably become one of the world’s leading “Cartel experts” – tells me the
end game is not just “coming,” but right in front of our eyes.
For most of the world’s 7.4 billion denizens, the end game has already
arrived – in the form of collapsing currencies, as history’s largest, most
destructive fiat Ponzi scheme implodes. The world’s “reserve currency,”
due to the superior power of its Central bank’s printing press, has not
collapsed as rapidly, or dramatically. Not yet, that is.
However, the price of this (historically infinitesimal) resistance has been
the largest debts in global history, the greatest wealth disparity since
feudal times, and a guaranteed violent end.
To that end, the Fed is, unequivocally so, more responsible for the
political, economic, and monetary hell the world is just starting to
experience. However, politicians, Central bankers, and corporate titans
throughout the entire Western world – and parts of the East, such as China
and Japan – are equally guilty of fostering a Ponzi scheme that has distorted
the world’s economic balance so dramatically, it will likely take generations
to normalize. Hopefully, in the absence of major wars; which
unfortunately, history tells us is highly unlikely.
As for said “precipice,” let’s just put its this way. I have
witnessed every major Cartel initiative of the 21st Century; as well as every
day-to-day, and minute-to-minute operation. And yes, “named storm”
attacks like September 2011’s “Operation PM Annihilation I”; December 2012’s
“Operation PM Annihilation II”; February 2012’s “Leap Day Violation”; and
April 2013’s “Alternative Currency Destruction” attacks were more violent, in
absolute terms. That said, never has my “manipulation mantra”
of “every day worse than the last” been more apropos than the past
month. That is, since the Brexit, which a month beforehand, I deemed
the “most
important, and Precious Metal bullish, election ever.” Since then,
irrespective of the aforementioned, maniacal Cartel suppression – to the
point that the COMEX “commercials” have taken their record naked shorts to
unprecedented levels – gold has pushed right up against the artificial
“downtrend line” created by the aforementioned named storm attacks, at
roughly $1,360-$1,370/oz; whilst silver has surged right up to its 50-month
moving average of $20.45/oz. Yes, the Cartel has attempted to “mask”
its fears of these critical levels by creating “secondary” lines in the sand
at the key round numbers of $1,350/oz and $20/oz, respectively.
However, make no mistake, the former levels are their ultimate lines
in the sand – as when they are inevitably broken, the entire world will see
that the four year, Cartel-engineered “bear market” in dollar-priced gold and
silver is decidedly OVER. Just as it has been in ALL other currencies
for as much as two years.
The past week alone, we have seen some of the most “PM bullish,
everything-else-bearish” headlines imaginable, from all corners of the
Earth. Economically, horrific U.S., Japanese, and Eurozone GDP say all,
accentuated by plunging Chinese trade data, and U.S. retail sales and
productivity. In fact, this very morning, U.S. “rate hike odds” plunged
anew – specifically, to 9% for September and 28% for December; whilst
comically, “Goldman Bill” Dudley, head of the New York Fed, spewed pathetic
propaganda, desperate to save both “face” and Hillary Clinton’s dying
election prospects, by claiming bond markets are too complacent, as the Fed
is “getting closer to the time” it would raise rates. Really?
“Getting closer?” So why are rates worldwide at record lows –
including $13.4 trillion of bonds with negative yields? And why are no
rate hikes “priced in” until mid-2017?
And for those claiming this morning’s July industrial production “beat” –
at 0.7% versus the expected 0.3% – was due to a “stronger than expected”
economy; not only are all such numbers “seasonally adjusted,” but the only
reason it “beat” was because June’s number was revised dramatically
downward. And FYI, the only strong component of the industrial production
index – by far – was utilities, which surged more than 2% due to the
most powerful summer heat wave in U.S. history. Irrespective,
industrial production declined year-over-year for the 11th straight month,
representing the longest such negative streak in U.S. history, at a time we
were not, LOL, in recession.
Of course, collapsing economic activity is just one symptom of the
distortions of the aforementioned, unprecedented, global fiat Ponzi
scheme. Zero, and sub-zero, interest rates – and the promise of
unlimited QE – have created the largest financial asset bubble in history;
cumulatively, far greater than 2000 and 2008 combined.
Consequently, dead-in-the-water companies’ stocks are trading at all-time
high valuations; insolvent sovereigns and weak – often, terminally so –
corporations and municipalities are trading at negative yields; and Central
banks are holding massive, unsellable portfolios of high duration, patently
worthless government, mortgage, and corporate debt. Moreover, massive housing
bubbles have developed in high-end markets due to money laundering and the
parking of massive, illicit financial gains garnered by the “1%” privy to
Central banks’ free money and market rigging activities, causing the cost –
but decidedly not the standard – of living to surge for the rest.
Contributing to the horrific economic woes, featuring the highest level of
industrial, commodity, and government “oversupply” in history, is the most
ominous “demographic cliff” the world has ever faced – given that it now has
7.4 billion people, whilst the maligned demographic regions, such as Europe,
Japan, the U.S., and China, are not only the most indebted; and the biggest
printing press abusers; but produce the vast majority of the world’s economic
output.
To wit, today’s Bundesbank announcement that it is recommending an
increase in the German retirement age to 69 – which tells us all we need to
know about the ugly direction the world is heading. Which, I might add,
was principally due to the fact that the vast majority of German pensions are
dramatically underfunded, due to the German governments’ own – via leadership
of the NIRP-promulgating ECB – destructive policies. In fact, this very
morning, i read one of the most terrifying articles ever – about this very
topic. Specifically, why rates can NEVER be raised once the insurance
Ponzi scheme takes hold – which is exactly where we stand today; and exactly
why ALL bond yields may soon be negative. That is, until hyperinflation
inevitably “comes to town,” destroying every financial asset in its path.
Heck, I haven’t even gotten started regarding the myriad factors
causing the Cartel – and generally speaking, all market manipulation
operatives – to go berserk this month. Such as, LOL, this morning’s
year-over-year CPI reading of +2.2% – albeit, unchanged month-over-month –
being over the Fed’s stated “rate hike threshold” of 2.0% for the ninth
straight month. And the funny thing is, the reason it was not higher
than last month was due to the plunge in oil prices that should have
occurred, and will unquestionably return shortly, given how horrific oil –
and nearly all commodity – fundamentals are. In other words, next
months’ reading will incorporate the latest “oil PPT” orchestrated
short-squeeze, putting further pressure on the Fed, despite imploding real
economic activity.
Oh, and did I mention the dollar/yen plunging below 100 this morning, to a
new post-Brexit low, last seen two years ago? This, despite the Bank of
Japan pledging to essentially buy the entire Japanese stock market, in its
latest miserable monetary policy failure. Which of course, will only
prompt them to ease further in September – which they’ve already telegraphed;
which will only create uglier, more destructive market and economic
distortions, invariably “PM bullish, everything-else-bearish.”
And how about this article, of how average U.S. healthcare
premiums are expected to rise 24% in 2017? Or the increasing likelihood
that the election will be thrown into chaos by Hillary Clinton’s obviously
declining health? Or Turkey threatening Europe to unleash millions of
Syrian refugees if the European Commission doesn’t meet its demands? Or
record U.S. equity outflows, compounding the PPT’s already Herculean
efforts? Or Portugal’s banking system falling apart more rapidly than
Italy’s – which despite last week’s “bailout” hype, has not improved one
iota? Or Deutsche Bank, who’s modest, PPT-supported equity bounce has
barely moved the needle, whilst its gargantuan insolvency continues to stare
us squarely in the face.
No, the Cartel’s best efforts to prevent gold and silver from taking out
the aforementioned “key resistance levels” will not succeed – including
today’s, which is sucking wind as I write.
And trust me, if the Fed continues to play the “imminent rate hike” card
without regard for its rapidly dying credibility – such as, for instance,
when tomorrow’s July “minutes” are released – they may create the polar
opposite market response as desired; like when PMs surged, whilst markets
crashed after last December’s “rate hike.”
In my view, the Cartel’s defenses have never been weaker – and possibly,
will fail in short order, “election protection” notwithstanding.
Unquestionably, it is “on the precipice”; and if you don’t “capitalize” on
their weakness, when doing so could mean the difference between financial
destruction and salvation, it will truly be a shame.
