Those who think the Goldmans or Morgans are stupid and clumsy are the ones demonstrating those traits. I see and know the same things these greatest of all time manipulators of price see and know. This is 1979 in the gold market right before the greatest price appreciation took place over the shortest period of time then. The most money over the shortest period of time in the gold bull market of the 70s was not made by the gold crowd but rather by the mega powers of Establishment Wall Street after doing the same things they are now doing.
The gold price can be pushed around like any market can be, but the purpose is to take away yours, increase theirs and then do exactly what is being done now on the upside.
In years to come you will dismiss all my efforts based on my $3500 and beyond number. The reason for this is that number will have only been a start in the gold price towards the new era of industrial expansion based on sound money and major nation’s balance sheets having been balanced by gold.
– Jim Sinclair, The Greatest Business Opportunity Of The Millennium, February 17 2013
Be sure and digest Jim Sinclair’s quote, above. Note that his $3500 gold prediction is just for starters and gold will rise much higher. No one has a clearer view of gold’s fundamentals than Sinclair.
Jim Willie, one of my absolute favorite analysts has written his 90-page February Monetary Crisis Report. Here is an excerpt. If you like what you read here, imagine what you are missing! His Hat Trick Letter heads my “must read” category. You should subscribe to it.
THE USFED IS LOCKED INTO A HYPER MONETARY EASING, SINCE ITS BOND PURCHASES EXCEED THE ENTIRE USGOVT DEBT ISSUANCE IN THE FORM OF USTREASURY BONDS. THE PROGRAM EXCEEDS BASIC BOND PURCHASE IN LAST RESORT. THE CENTRAL BANK CONTINUES TO MONETIZE THE FINANCIAL SYSTEM, NOT JUST THE SOVEREIGN BOND. MANAGED FINANCE HAS GONE HAYWIRE WHILE THE MECHANISMS FOR BALANCE ARE ERODING OR GONE. TO MAKE ROOM, THE USGOVT DEBT LIMIT WAS SUSPENDED TO MAY 2013.
To put it simply, so far this calendar year 2013, the Federal Reserve has bought more USGovt debt than the USDept Treasury has issued in securitized bonds. At year-end 2012, the total USGovt debt was $16.4327 trillion. The legal limit was hit. In early February, the USCongress enacted a law to suspend the federal government debt limit until May 18, 2013. Added debt can be tacked on legally. By February 6th, the debt had grown by $47.2 billon in the new year. Consider the USFed bond account. At the close of business on January 2nd, the USFed had possession of $1.661 trillion in USTreasury securities. By the close of business on February 6th, it owned $1.7172 trillion, for an increase of $51.1 billion in the new year. Thus their purchases of USGovt debt in this calendar year have exceeded the Treasury net debt issuance by about $3.9 billion. The only USTBond buyers left on stage are the USFed press with Weimar nameplate.
The venerable ruined USFed, center for American financial crime, announced that it will continue purchasing additional longer-term USTreasury securities at a pace of $45 billion per month. All hail the Fed, broken as it is. A footnote that the US central bank purchases much more than they openly discuss, covering much mortgage bonds that have spurious value discharged by the big US banks. Quietly with little fanfare, the USFed is monetizing all that has been ruined, which means much of the entire US financial system. The bond market has gone far out of control in utter insolvency. Next they might examine wrecked big corporate bonds and a smatter of junk bonds. Why not, since money is free? See the CNS News article (CLICK HERE).
JANET YELLEN HAS GIVEN FIRM SIGNAL FOR Q.E. TO INFINITY, PRECISELY AS THE JACKASS FORECASTED. THE STIMULUS IS FOR SPECULATION AND FOR RISING COSTS, IN NO WAY ECONOMIC.
The Jackass claimed in 2009 that the USFed could not execute any Exit Strategy, or else cause a calamity for the big banks, the USGovt, and financial derivatives. So far the call has been on the mark. When the Quantitative Easing desperate lunacy began in 2010, the Jackass claimed it would have numerous follow-on QE chapters. Then my conclusion was that QE to Infinity would be justified in a forever policy. So far the call has been on the mark. In a recent speech, the weather vane Janet Yellin confirmed the Jackass forever call. She said, “The Federal Reserve may keep interest rates near zero after its bond buying ends, even after hitting its targets for unemployment or inflation, in order to maintain stimulus.” Clear as a bell, not even a flinch, no surprise to the Jackass. The confirmation is of Weimar Amerika. Those who accept the monetary policy as sound and sustainable are mentally deficient, to put it bluntly. The QE to Infinity Forever is the monetary policy, as in Reich Finance. Stimulus is not reason, but rather avoiding a collapse. See the Bloomberg article (CLICK HERE).
THE CHINESE YUAN WILL SPREAD TO THE PERSIAN GULF REGION. A BIG TRADE DEAL WAS STRUCK WITH THE SAUDIS AND EMIRATES OF THE U.A.E. LAST YEAR, WHICH WAS ACCOMPANIED BY A YUAN CURRENCY SWAP FACILITY ESTABLISHED IN THE UNITED ARAB EMIRATES. THE LAST NAIL IN THE USDOLLAR COFFIN COMES WHEN THE SAUDIS PERMIT NON-USDOLLAR PAYMENT FOR CRUDE OIL. THAT DAY IS NEAR.
The Chinese have taken more control of the Intl Monetary Fund itself. In January, a plan was revealed by Zhu Min, the deputy managing director of the IMF. He made a statement where he proclaimed that the shift by China into a more self-sufficient consumer based economy had been successful. The important step would be followed up by placing the Yuan currency as a world reserve currency. The IMF has confirmed the Yuan (renminbi) is set to become a Global Reserve Currency, the acknowledgment made at an Economic Forum in Hong Kong. See the Want China Times article (CLICK HERE). The Yuan is being called a Global Reserve Currency even by China, having established the foundation for changes in a short period of time. China does not reveal their hand until everything is already said and done. The USDollar has been owner of the global reserve for decades, seemingly forever. They must next share the control, then suffer its loss in a grand comparison in grotesque embarrassment and humiliation. The USDollar will suffer the lost prestige in practice very suddenly. The Chinese leaders are crafty and patient and deliberate. They put everything in place, making preparations, and then reveal their movements and plans.
Recall that the Premier of China had gone to Saudi Arabi and Dubai a year ago. He stayed a week, conducting meetings and making agreements. China signed economic and trade agreements worth 100 billion Yuan (=US$16 bn) with Saudi Arabia and the United Arab Emirates, as Premier Wen Jiabao completed a six-day visit to the Middle East. The first currency swap agreement with Arab nations, worth 35 billion Yuan, was also signed in Abu Dhabi. The news occurred last year, when Premier Wen attended the Fourth Arab-China Business Conference in Sharjah in the UAE.
Saudi Arabi is soon to announce being the last Middle Eastern country to trade outside the so-called Petro-Dollar. If (when) Saudi Arabia initiates crude oil trade in other currencies, then the death knell is rung, as in game over for the USDollar. Not just loss of the Global Reserve Currency status, but the USDollar will face isolation, judgment, criticism, and finally severe devaluation following the shameful debt downgrades. The US might be declared a financial rogue nation, my expectation. Given how the USDollar finds strength only in the active competitive devaluation process managed by numerous foreign nations, the USDollar will next find its truly (much lower) value when it is not used in global trade. With the USFed printing the dollar non-stop, the currency wars raging fierce, the US currency is poised for a massive fall. The process stops when the USDollar is deposed and the new Gold Standard is instituted, led by its newly adopted role in trade settlement. The only countries left all to themselves with their inflating currencies will be the United States and United Kingdom and certain Western European nations. They will form the new Industrialized Third World community. The day comes soon, signaled by both the IMF and China. The Yuan will share the stage as a Global Reserve Currency. Do not be mistaken. The USDollar cannot share that stage. It will fall off it rapidly.
For some good background material on the internationalization of the Chinese Yuan, aka renminbi, see the Swift research papers (CLICK HERE and HERE). For promoting the London financial center on Yuan currency issues, see the City of London research update (CLICK HERE).
Adam Hamilton’s analysis is always interesting and his charts and graphs are unequaled. He concludes that gold’s young up-leg is looking fine and it will be interesting to see what happens in the coming weeks as the gold-loving Asians return to the market.
FutureMoneyTrends presented their silver analysis yesterday. They concluded that (1) there are irregularities in the silver sector, (2) Similar irregularities have occurred in the past and (3) the long-term market (9+8 months) is more bullish than bearish.
Adding to the discussion on silver is Jason Hommel’s accurate review of silver’s performance over the last 10-years. To say he is bullish on silver is a gross understatement.