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Sunday Night Sentiment Stats

Read the Monday Afternoon Wrap-Up for 10/15/2012 and the Tuesday Morning Commentary for 10/16/2012

In my January 31st RANT, “SUNDAY NIGHT SENTIMENT,” I wrote of the Cartel’s decade-long penchant for attacking PAPER Precious Metals in the thinly-traded Sunday night markets; i.e., when only Hong Kong – or even Sydney – have available trading platforms.

Call it a curse or blessing, but Precious Metals trade 24/5 – plus – care of electronic trading platforms, subject to heavy intervention.   Consequently, PM’s are typically lower 90% of the time after the NYSE closes, for example.  Other markets also trade overnight, such as currencies and crude oil.  However, they rarely have material moves in the wee hours; as no one MANIPULATES them with the same intensity.

I have long noted TPTB’s last remaining “weapons” of MONEY PRINTING, MARKET MANIPULATION, and PROPAGANDA; cumulatively, utilized to affect popular PERCEPTION; i.e., sentiment.

Moreover, given the tiny size of the global PM community, it doesn’t take much to dissipate bullishness; particularly given the constant attacks, smashes, and WATERFALL DECLINES characterizing the market; let alone, the relentless stream of fear-mongering – both inside and outside the PM community; and, most importantly, the tendency of PM believers to avoid PHYSICAL bullion in lieu of highly speculative “PAPER PM Investments” like ETFs and mining shares.

The most notorious “SENTIMENT” attack was the May 1st, 2011 “SUNDAY NIGHT PAPER SILVER MASSACRE”, per below.  As silver approached its “ultimate triple-top breakout” at $50/oz, industry supply SOLD OUT, yielding genuine Cartel fear of a monetary meltdown.

Thus, with the Chinese market CLOSED for a holiday, and only the thinly-traded Sydney platform open, they attacked silver for $6/oz in roughly 12 minutes; stooping so low as to use the “bin Laden killed card” as cover to “double down” when silver attempted to recoup its losses (as if bin Laden had anything to do with silver)…

Aside from such dramatic, “blitzkrieg” attacks, PMs are always “capped” on Sunday nights during upcycle periods – as we saw from mid-August through the “QE3” announcement in mid-September – and ATTACKED during (Cartel-engineered) downcycles.

Consequently, I do as much manipulation analysis on the upside as the downside.  Only after reviewing both sets of data does it become clear just how pervasive the Cartel’s activities are; as described in my March 9th RANT, “CHUTES AND LADDERS.”

Below, I compared the level of Sunday night silver increases during the three upcycles of the past year, as well as the four downcycles.  As anticipated, the average Sunday night increase during PM upcycles – comprising 24 weeks of data – was a miniscule $0.10/ounce…

less than a third the average $0.32/ounce decline during the 22 down weeks…

Of course, the latter data ignores the fact that Cartel blitzkrieg attacks often occur during COMEX hours, negating the need to attack Sunday night, given how much damage was already done; such as was the February 2012 “LEAP DAY VIOLATION,” when Cartel forces inflicted a $2.50/oz decline.  Conversely, similarly-sized COMEX surges NEVER occur…

The key takeaway – as always – is to understand PAPER markets are but an ILLUSION; following a stale, transparent SCRIPT aiming to divert your capital from PHYSICAL Precious Metals.  If you understand, you’ll realize why “PAPER PM Investments” are a one-way ticket to the poorhouse, and PHYSICAL gold and silver impervious to such criminal machinations.

PROTECT YOURSELF, and do it NOW!

Call Miles Franklin at 800-822-8080, and talk to one of our brokers.  Through industry-leading customer service and competitive pricing, we aim to EARN your business.

Sunday Night Sentiment

MONDAY AFTERNOON MARKET ALERT

Way to go, ADMIRAL SPROTT!  Less than two weeks ago, our fearless leader announced a $349 million offering of PSLV, the Sprott Physical Silver Trust, and since then gold rocked $5.00/oz higher, Cartel suppression and all.  This afternoon, post market close, the Sprott Physical Gold Trust, or PHYS, announced an overnight offering of up to $200 million, to purchase PHYSICAL gold tomorrow morning.

Unlike the PSLV offering, which was open-ended as to pricing, the PHYS offering memorandum states the deal will be priced at $15.19-$15.24/share, slightly below today’s closing price of $15.34/share, which would push its market cap up to $2.3 billion.  Today’s closing price represented a 5.0% premium to Net Asset Value, so the deal (as has been the case for EVERY offering of the five closed-end bullion funds PHYS, PSLV, CEF, GTU, and SVRZF) will be accretive to current shareholders.  Last year, PHYS also closed an offering very near the previous day’s closing price, so I am highly confident this deal, too, will be a smashing success.

As I described in last week’s RANT, Eric Sprott is a man on a mission to destroy the Cartel, much like myself but with the financial firepower to back up his knowledge and passion.  Do not underestimate the extent of damage he can cause the Cartel, which in my view is on the verge of breaking down to start with.

Sprott Physical Gold Trust Announces Follow-on Offering of Trust Units

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MONDAY MARKET WRAP-UP

Per the title of today’s RANT topic, in line with what most people anticipated, the Cartel started yet another week off by attacking PMs at the open of the thinly-traded Asian markets on Sunday night, a long-standing tactic utilized to wilt SENTIMENT during a time of the day gold and silver investors have been conditioned to fear following a decade of systematic, manipulative abuse.  To which I respond, “Is that all you got?”

As you can see below, all KEY ATTACK TIMES were utilized today in varying degrees, starting with the pre-emptive Sunday night walk down, followed by the WATERFALL DECLINE at EXACTLY 3:00 AM EST, a hard cap of gold’s rebound rally at EXACTLY the 8:20 AM EST COMEX open, a second WATERFALL DECLINE when gold attempted to go positive at EXACTLY the PM FIX at 10:00 AM EST, and of course the high tick of the day  at EXACTLY 12:00 PM EST, the “cap of last resort.”  So for those of you that think gold was “resting” or “consolidating” last week’s sharp gains, I say BALDERDASH!  Show me a decline that does not occur at the same times of day as ALWAYS, and I’ll agree with you.  But until then, give me a break, particularly when that same KEY ROUND NUMBER of $1,750/ounce is again being heavily defended.

EACH and EVERY Cartel “supplemental tool” was utilized today, starting with the Dow / Gold x 2 ALGORITHM we saw all morning when the Dow had the nerve to actually open down 100 points.  You see, a 100 point Dow decline is the PPT equivalent of the Cartel’s 2% rule.  In other words, while PAPER gold is essentially NEVER allowed to rise more than 2% in a single day (let alone 1%), the Dow is no longer allowed triple-digit declines, even though 100 points only equates to a measly 0.75% at current prices.

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READ THE FULL NEWSLETTER
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MONDAY EVENING REPORT

Late this evening, Jim Sinclair sent an urgent email about an impending event of great importance that MUST be heeded, on which he completed a special interview with the Ellis Martin Report about.  The event involves the potential treatment of the impending Greek default by the ISDA, or International Swaps and Derivatives Association, the trade group responsible for deciding whether or not a “credit event” is considered a “default” under the terms of myriad credit default swap, or CDS, agreements.

If you remember the late October “Greek 50% haircut” deal – which triggered a huge equity rally, but NEVER happened, the ISDA determined a 50% debt write-down to NOT be a “default,” in perhaps the biggest farce in market history.  Of course, the ISDA is a trade association managed by the very firms that create derivatives and swaps – namely, the five banks responsible for writing 97% of ALL CDS swaps – JP Morgan, Goldman Sachs, Citibank, Morgan Stanley, and Bank of America.  I know, you really can’t make this up, a trade organization with the power to declare its mistakes “non-events,” but that’s the world of criminality we live in.

The Most Powerful Body In Finance And What They Mean To You

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READ THE FULL NEWSLETTER
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TUESDAY MORNING COMMENTARY

After all that occurred last night, this morning is a bit anti-climactic.  As noted above, the mantra of the day remains PRINT MONEY and MANIPULATE MARKETS, and as usual the Dow futures are higher.  Overnight news is relatively thin, as has been the case during the recent period of market “LOCKDOWN” by TPTB, unless you believe Israel warning Iran of an imminent invasion, i.e. the potential commencement of World War III, is not newsworthy.

Israel warns time is running out before it launches strike on Iran

I also see Venezuela finally took delivery of its 160 tons of gold, formerly stored in London.  I can only imagine the hoops the thieving BOE had to jump through to secure such metal, which I’d bet dollars to doughnuts was sold or leased years ago to illicitly hold gold prices down.  Better yet, will they be able to honor the next batch of gold repatriation demand, such as the imminent summons of Holland’s 613 tonnes?  And, for that matter, will the New York Fed be able to do same when they, too, are demanded gold from supposed custodial accounts of foreign central banks?

Venezuela Completes Repatriation Of 160 Tons Of Gold

According to this article, markets are somehow “juiced” by the idea of a Greek default – er, 70% write-down – as if no one, such as the BANKS that own this debt, will be impacted.  Oh wait, I see, “LTRO 2” is coming on February 29th to save the day, with the current consensus that an additional €1+ TRILLION will be PRINTED by the ECB – aside from non-stop, “off balance sheet” funding from the Fed “swap facility” to cover up these bank losses and enable carry trade “profits” to pay BONUSES with.  No, this won’t end badly.

The Market Says CYA LTRO To Yesterday’s Negativity

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READ THE FULL NEWSLETTER

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TUESDAY MORNING BREAKING NEWS

The PHYS press release just emerged while proofreading, and it was a BLOW OUT deal, of $303.8 million priced at $15.19/share, compared to the initial offering range of “up to $200 million, including overallotment, at $15.19-$15.24/share.”  As it turns out, the deal will be $349 million if the overallotment is exercised, EXACTLY the same amount of Sprott’s PSLV silver offering last week.  As Eric Sprott has emphasized for some time now, silver sales continue to be 1:1 on a dollar basis with gold sales, and thus the current 51:1 gold: silver ratio will not last much longer.  I agree whole-heartedly, as both ADMIRAL SPROTT and myself believe the gold:silver ratio will fall to AT LEAST the historic ratio of 15:1, perhaps significantly lower.

Sprott Physical Gold Trust Prices Follow-on Offering of Trust Units In An Aggregate Amount of US$303,800,000

PROTECT YOURSELF, and do it NOW!

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SUNDAY NIGHT SENTIMENT

Sunday afternoon, when the world’s working classes are finally relaxed at the tail end of their weekly “48-hour vacation.”  During summertime, the barbecue is smoking, and in the winter the TV blaring with the mesmerizing sounds of pro football.  For most, the last thing on one’s mind is financial markets, unless of course you’re a die-hard Precious Metals investor.  Gold’s 24 hour per day trading liquidity is a comforting thought, but as all “goldbugs” know, the Cartel does its best handiwork in the wee hours of the night, particularly 3:00 AM EST when no markets are actively traded.

On average, gold trades higher during the Asian trading hours, excepting the SUNDAY NIGHT OPEN, when the Cartel often aims to “set the tone” for the day by smacking the market lower.  Here in Denver, it is roughly 4:00 PM when Asian gold starts trading, so I can see quite early if a Cartel scheme is in action, such as the SUNDAY NIGHT PAPER SILVER MASSACRE on May 2nd, 2011, below.

I have not pored through all the Sunday night charts as in past RANTS, particularly the three COMEX GOLD MANIPULATION PICTORIALS published in 2011, links below.  However, I can tell you – from a decade of experience – that the ONLY time in the overnight session (pre- 3:00 AM EST, of course) that gold typically falls is the Sunday night open, and I’d venture gold rises more than 0.5% at the Sunday night opening less than 2% of the time.

Ranting Andy Special: 2011 Comex Gold Manipulation Pictorial

Ranting Andy Special 2: 2010 Comex Gold Manipulation Pictorial

Ranting Andy Fall 2011 Comex Gold Manipulation Pictorial

That said, there have been extended periods of “Sunday night excitement,” such as when gold is an extended up move based on news the Cartel has trouble “managing,” such as S&P’s downgrade of the U.S.’s AAA rating on August 6th, 2011.

When such periods occur, the Cartel still attempts to start most weeks with a “negative bang,” in this case below at that same pesky, KEY ROUND NUMBER of $1,750/ounce!  However, under such circumstances Asian buying often overcomes these attacks quickly, as we saw the Sunday following the U.S. debt downgrade, below.

READ THE FULL NEWSLETTER

Sunday Night Paper Massacre 2 – and the Upcoming, Guaranteed Physical Shortage

It’s Monday morning, and there’s no rest for the weary. And by weary, I don’t just mean last night’s lack of sleep – notwithstanding the prudent investment choices that have kept me from real insomnia – but 13-plus years of fighting a war with reality I neither chose nor relish. Yes, I love what I do – perhaps, more than ever before – and it’s for people like you that I wake up earlier than ever, bright eyed and bushy-tailed. But no, there is nothing “fun” about manipulated markets, which in many ways have rendered moot 26-years of academic and practical experience analyzing fundamentals – and subsequently, choosing appropriate investments, for myself and others.

Here at Miles Franklin, we do not “recommend” anything, but simply tell the truth as we see it – which, manipulation or not, must eventually be reflected in financial (and physical gold and silver) markets. That said, the “short-term,” in a world amidst the most hideous, blatant episode of money printing, market manipulation, and propaganda, has turned out to be far less “short” than imagined – care of the unprecedented advancement of “weapons of mass financial destruction,” far beyond anything imagined during previous bubbles. Of course, no such “previous bubble” involved the end of the economic and monetary world as we have known it, which is precisely what we are dealing with today. And fortunately, those holding physical gold and silver have actual supply and demand forces on their side; as opposed to “paper PM investments,” and nearly all other financial assets – which cumulatively, have never been so overvalued, or vulnerable to the relentless, expanding strength of “Economic Mother Nature” and the “unstoppable tsunami of reality.”

Last week, the Wall Street Journal started to be thrown on my driveway without prompting, marking the first time I have seen this vile publication since I stopped reading it 17 years ago. Back in the formative years of my career – starting with my first internship during college (selling CD’s via cold calling, yielding 8% compared to 0% today), the Wall Street Journal was a veritable text book for learning about financial markets. Today, it has become such a blatant propagandist rag, it takes all my strength to not call their offices and tell them I’d prefer a free subscription to Satan’s handbook. Such as, for instance, the stunningly ignorant, aggressively vicious articles they published this weekend, titled “gold bugs getting exterminated” and “let’s be honest, about gold – it’s a pet rock” – the latter of which stated, with a seemingly “straight face,” that “gold is supposed to be a haven amidst hard times and soft money. So why, even as Greece has defaulted; the euro has sunk against the dollar; and the Chinese stock market has stumbled; has gold been sitting there like a pet rock?”

The reason, of course, for anyone with a pulse; an interest in truth; and the ability to discern reality from fraud; is that – per Michael Pento’s spot-on comments this weekend, “there are no free markets left in this world, and it’s becoming increasingly evident that most people on Wall Street prefer it that way. To wit, we have grown so accustomed to market manipulation; we have completely lost sight of how a free market is supposed to function.”

Regarding Precious Metals – which, over several millennia, have represented the polar opposite of the fraud paper money has proven to be – no one has better reported the manipulative horrors that have brought the global economy to its knees better than GATA, via the courageous, unyielding leadership of Bill Murphy and Chris Powell. To wit, even before last night’s heinous Cartel “hit,” GATA published this must read article – of how, with each passing day, more and more people are first realizing, and then publicly admitting, the truth. Such as, for example, John Hathaway of the Tocqueville Fund; i.e., one of the oldest, most respected mainstream portfolio managers. Who, despite his specialty in Precious Metals, has for years ignored the most important factor affecting the market he is mandated to invest in; that is, until now.

“At some basic level, all investors are aware of the gold price, as its unruly behavior could render the (government’s) ‘Truman Show’ dysfunctional. Allowing free-market expression of gold prices (poses) a serious risk at the highest policy levels; (and thus), gold’s strong increase amidst liberal doses of QE post-2008 through 2011 (struck) a note discordant with an otherwise happy fable, confirming what many investors suspected: i.e, QE and ZIRP failed to produce economic growth, and may well have jeopardized future prospects for a return to solid economic footing.

(Thus), it makes us wonder whether we are witnessing the final moments of a second, more sophisticated version of the 1960s London Gold Pool; i.e, a scheme organized by the U.S. and European governments to suppress the free-market gold price, to camouflage the growing, adverse fundamentals for the U.S. dollar. The present-day magnitude of fiscal and monetary irresponsibility, in our view, exceeds the precedent of the 1960s by multiples. And thus, it is only fitting that the elaboration and complexity of disguise required to beautify the underlying reality would be proportional. Government intervention via price suppression (interest rates, currencies) or price inflation (financial assets) seems to pervade all financial markets, so why should gold be exempt?”

I mean, at some point even the most die-hard “mainstreamers” have to admit to the reality that all they have been taught – in many cases, providing the means to earn a living – no longer exists. Like, for instance, the use of fundamental, technical, and sentiment metrics to gauge entry and exit points for financial assets. As now that governments are overtly manipulating markets – be it via traditional, “accepted” means like Central bank QE; or new, “unconventional” methods like the outright purchase of stocks (as documented here, here, here, here, and here), it’s no longer “conspiracy theory” to speak of market intervention – particularly when those executing it are being caught red-handed, in everything from stocks, to bonds, interest rates, currencies, and – what do you know – gold. And as for government participation in such schemes, one doesn’t have to an inordinate amount of “research” to realize such policy exists – as the U.S. government, for example, admits to regarding bonds (i.e., Federal Reserve interest rate policy); stocks; and oh yeah, gold and foreign exchange. Heck, the Chicago Mercantile Exchange – which in many ways, has acted as a de facto government agency for years, now offers “volume discounts” for Central bank trading in commodity, equity, currency, and fixed income futures!

Even MSM lackeys like Bloomberg are starting to understand the racket – in realizing, for instance, that China’s gold reserve announcement on Friday, comically understated as it was, was wildly bullish for long-term Precious Metals demand. That said, how ironic is it that, of all the media outlets on the planet, the one most antagonistic to gold has been Kitco? Which, whilst its bankruptcy protection approaches its fifth year, continues to publish the most anti-gold propaganda imaginable; such as, unsurprisingly, it’s “top story” following last night’s Cartel raid being Reuters’ unmitigated drivel that gold was down due to “dollar demand.” And this, whilst the dollar index, which is up solely due the collapse of the European Union, and self-immolation of the Bank of Japan, was completely unchanged from its Friday afternoon close; as were, by the way, all other markets.

That said, it’s time to focus on the “end game” playing out right before our eyes – firstly, for history’s largest, most destructive fiat Ponzi scheme; and secondly, investors’ diminishing ability to protect themselves with increasingly scarce Precious Metals. To wit, for 15 years the Cartel has run roughshod over the supposed “markets” for gold and silver; not only creating the grossest deformations in global economic (and financial markets) history, but destroying miners’ long-term survivability – as I discussed at length last week. That said, even Friday’s egregious Precious Metals paper raids couldn’t prepare us for what we witnessed last night; when, out of the blue, the Cartel attacked gold with a vengeance not seen since May 1st, 2011’s “Sunday Night Paper Silver Massacre.” Only this time – unlike then, when a “catalyst” was feigned in the form of the supposed capture of Osama bin Laden – there was absolutely, positively no news to account for, in the thinnest of Sunday night Asian trading, gold plunging by an astonishing $52/oz, or 4.6%, in one minute. Below I have placed, side by side, silver “trading” from May 1st, 2011 (a night, by the way, when China was closed for a holiday) and gold last night. Look familiar, does it?

Frankly, now that the Cartel has attacked on 107 of the past 109 Sunday nights, it’s difficult to be surprised. That said, we are talking about a $52/oz plunge in one minute – which, as noted above, won’t be lost on a world increasingly aware of the fraudulence of financial markets; increasingly fearful of the aforementioned “end game” of global currency collapse; and increasingly knowledgeable of the expanding, gaping chasm between physical Precious Metals demand and supply.

And again, there is absolutely nothing about this raid – from a time and method perspective – differing from dozens of others over the years; including the 478th “2:15 AM” EST raid the past 544 trading days, to additional attacks at the 8:20 AM and 9:30 AM EST opens of the COMEX and New York Stock Exchange, respectively. In fact, just as a whopping $1.4 billion of “paper gold” – or 2% of worldwide annual production – was dumped at the COMEX open on Friday morning, $2.7 billion hit the Asian markets “at one fell swoop” last night, with the obvious intention of taking prices down.

Holding physical gold and silver, the impact of such a raid is minimal – particularly in the case of silver, which as we speak is still amidst a major shortage, causing premiums and delivery times to significantly expand. However, regarding “paper PM investments” like mining shares, the end game I have for four years vehemently warned of is in sight. This weekend’s Audio blog discussed the utter annihilation of mining shares on Friday; and as I write this morning, the HUI is down another 8%, to levels not seen since 2003. In other words, discounting what I have long predicted; i.e., the utter collapse of supply – of both gold and silver – that likely, for all intents and purposes, will be permanent. Frankly, if prices don’t rebound significantly, and imminently, I’m not sure that even a massive consolidation wave will save Precious Metals mining; particularly in silver, now that base metal prices, too, appear headed to multi-decade lows. Not to mention, the world’s most important commodity – crude oil – and commodities in general, which this morning, cumulatively, hit a new 13-year low, causing global currency markets’ ongoing, Federal Reserve-fostered crash to accelerate. As long-time readers are well aware, I believe commodity markets have been so egregiously “deformed” by decades of inadvertent Central bank propping, it could be years, if not decades before they return to equilibrium. And in the process, the countless corporations, municipalities, and sovereign nations dependent on their sale – which cumulatively are already in more debt than at any time in history – will go bankrupt.

Here at Miles Franklin, we couldn’t be more aware of what Precious Metals holders have been through over the past four years, and are going through right now. We, too, have suffered, but our business couldn’t be more stable, and our desire to protect clients far beyond the “profit motive.” To that end, we simply ask you to call us at 800-822-8080, and give us a chance to earn your business. In our view, the physical shortages of 2008, 2011, 2013, and today are “culminating” – and when they do, the all but assured long-term shortages, certainly at prices resembling today’s comically suppressed levels, will make it difficult for most, if not all of the “99%” to protect themselves from the hyper inflationary Central bank nightmare that’s rapidly approaching.

The Worst Precious Metal Sentiment in Two Decades

Before starting, I want to share a comment from “Reader Ed” – which frankly, is one of the nicest compliments I’ve received in my career. In my view, the Miles Franklin Blog is one of the best sources of information about the global economy, financial markets, and Precious Metals fundamentals around – in large part, because we focus on, plain and simple, on the unvarnished truth. Yes, the truth can set you free – which is why I take great pains to instill this concept into my three-year old daughter; and why, per the comment below, the entire world – and certainly the opaque Precious Metals community – would greatly benefit from more of it. Which, by the way, I am 1,000% confident will occur in the coming months and years.

“These Hoffman articles are among the most well thought out and intelligently articulated of all the internet commentators who deal with economics and the PM’s. If all the other people in the PM business were as reasonable and balanced, there might be less skepticism among readers of the other sites who appear to have grown weary of all the unfulfilled predictions.”

Again, per yesterday’s must hear Audioblog, we are not making “predictions” of financial market performance; even, for that matter, gold and silver over the “short-term.” Conversely, we simply aim to spread truth; which, hopefully, you will, too. The world is a very big place, with close to seven and a half billion denizens. That said, the Internets reach continues to grow exponentially; and thus, nearly everyone will soon have access to alternative views. And given the power of our particular message – of the inevitability of fiat currency depreciation, and real money appreciation, we have no doubt our work – and yours, if you help to spread it – will be fruitful.

That said, let’s move on to today’s very important message. That is, after a brief discussion of today’s “horrible headlines” – which sadly, will worsen with each passing day, until the inevitable, and perhaps imminent, collapse of history’s largest, most destructive fiat Ponzi scheme. After which, life “as we have known it” will disappear; for a time, to be replaced with a far scarier existence – but eventually, a more stable, productive global economy, based on sound money. To that end, it is not the Miles Franklin’s Blog intent to guide, advise, or prepare you for such unknowns; but instead, to simply make you aware of what has always occurred to fiat currencies under such scenarios – and conversely, what has always been the demand response of real money.

OK, so let’s start with political lunacy – like the U.S. House of Representatives voting by the horrifying tally of 348-48 to arm the Ukrainian government, in what borders on an implicit act of war against Russia. Last year, we warned of just how dangerous the situation in this extremely troubled geopolitically important region could get. And now, with the currencies of both Russian and the Ukraine having collapsed; countless failed cease fires; expanding casualties; non-existent peace negotiations; aggressive Cold War rhetoric; and outright nuclear threats – such as Russia delivered yesterday – we can only say this. To ignore the potential for significant global geopolitical instability, particularly given the consternation caused by plunging oil prices – is to, at least financially, “whistle past the graveyard.”

Meanwhile in Europe, Greece – and the entire European Union – edges closer to the abyss. In what has become a cross between the worst Greek comedy and tragedy, we’re now told Greece has until Monday to submit details of the ridiculous, ambiguous “reforms” that emerged from the February 20th funding deadline crisis; which, as it turns out, weren’t even written by the Greeks! Frankly, I don’t think anyone is even paying attention anymore – as no matter how much can-kicking is attempted, it is a mathematical certainty Greece will fail in the near future; and when it does, the resulting “Grexit” will be financially – and psychologically – devastating to the world’s second largest currency.

But the scariest part of all is that it’s not just the “PIIGS” in imminent danger, but all of Europe; and for that matter, the entire world, given the ubiquitous financial ties in place. That said, Europe is clearly the epicenter – which is why yesterday’s news that France plans to unveil a broad swath of currency controls is so terrifying – like the limitation and surveillance of nearly all cash transactions, and the required reporting of gold transportation throughout France. Yes, my European friends, we could not be more urgent regarding just how small your window of opportunity to protect financial assets has become – and when the Euro does inevitably collapse, that window will likely be permanently closed.

Already, our Mexican readers – suffering from the inflationary effects of a plunging Peso – are telling us of how difficult it has become to source Precious Metals, let alone at a reasonable price. Well, guess what’s coming soon to Europe? And for that matter, American, and the rest of the world? This is why you must act now to protect yourself from draconian government acts – which only occur in response to calamity. Clearly, the French government senses calamity now. And thus, we ask, would you rather own “priceless precious metals or worthless fiat currency?

Here in the United States of Collapse, this morning’s horrifying February durable goods orders number (-1.4% versus expectations of +0.7%) continues a relentless stream of “2008-like” data, completely invalidating the fraudulent “PMI Manufacturing” diffusion index figure I railed about yesterday. I mean geez, what part of the biggest annual plunge in global trade volume since mid-2011’s Global Meltdown II do people not understand? Or, for that matter, yesterday afternoon’s American Petroleum Institute data, revealing the largest inventory build in 34 years? Or heck, the pathetic “benefit” of $11 trillion of global economy on the dying U.S. economic empire – which trust us, would look far uglier if real, “apples to apples” accounting was utilized. Consequently, the 10-year Treasury yield is trading – as I write Wednesday morning – at a paltry 1.86%, compared to 2.26% in the moments following last month’s historically fraudulent NFP employment report. For the millionth time, as I wrote in last year’s “most damning proof of QE failure,” Treasury rates are plunging because the entire world is front-running the inevitable launch of QE4 – which frankly, would not surprise me if it occurs this year. Nor would it surprise Whirlybird Janet herself, how last month delivered the “most unequivocally dovish FOMC statement in memory” to Congress.

And now, for today’s principal topic; i.e., the “worst precious metal sentiment in two decades.” That said, let’s start by saying “sentiment” is a very ambiguous concept; and thus, constantly miscalculated, misinterpreted, and misunderstood. Let alone, by newsletter writers seeking to generate trading activity, by insisting it can be quantitatively harnessed. Which, by the way, is particularly dangerous in the Precious Metals sector, given how it is the most manipulated (read: suppressed) on the planet, with “Cartel traders” well aware of everything from sentiment readings to technical resistance and support levels.

However, the physical gold and silver markets are entirely different animals, for a variety of reasons. To start, nearly all buyers – of physical metal, not “paper PM investments” like mining shares, ETFs, and closed-end funds – do so for the right reasons; i.e, long-term protection against and fiat currency inflation, and insurance against political, economic, and market calamity. Secondly, the time, effort, and cost of selling gold and silver is a considerable deterrent; i.e., the polar opposite of owning, for example, GLD or CEF, in which one click of the mouse, and you’re divested. And finally, as pertains to the current situation, never have the fundamentals for Precious Metals ownership – both monetary and economic – been so powerful; let alone, with prices trading below the miners’ respective costs of production, making it that much more difficult to pull the trigger on a sell order.

That said, this is unquestionably the most terrified I have seen the Precious Metals community since entering it 13 years ago; as is the case with Miles Franklin, which has been in the Precious Metals business for two decades. The reason, of course, is the relentless Cartel attacks that, while ongoing since the PM bull commenced at the turn of the century, accelerated exponentially when TPTB went “all in” to market manipulation in mid-2011, and berserk following the infamous April 2013 “closed door” meeting between Obama and the “TBTF” bank CEOs (just one day before the hideous “alternative currency destruction” raids). Things have gotten so bad, we have now witnessed psychology-destroying “Sunday Night Sentiment” raids on 91 of the last 92 weeks; “2:15 AM” EST raids on 405 of the past 464 trading days; “Sixth Sigma” declines in thin aftermarket trading; and of course, unconscionably blatant silver waterfall declines. And this, amidst some of the most violently positive PM headlines of our lifetimes.

Consequently, Miles Franklin is actually seeing the first material selling activity since going into business in 1989. Not that the total volumes are particularly large – or that such supply has a material impact on prices (likely, it’s already in China). However, we have not seen material selling activity since the PM bull market commenced nearly two decades ago; and again, this is occurring amidst the most bullish PM news flow of our lifetimes – much less, with prices so low, the mining industry is on the verge of collapse! Obviously, Americans have become so frustrated – and jaded to the expectation of new Cartel attacks – that seemingly no news prompts them to action. And clearly, since people like myself are already fully invested, the U.S. market requires new buying leadership to restart it. Of course, this is hardly the case overseas, where plunging currencies have caused gold prices to surge in foreign currencies. However, to secular Americans, such reality isn’t even on their radar screen yet.

Consequently, the charlatans financial opportunists characterized as “deflationists” are having their 15 minutes of fame, making ridiculous predictions like sub-$1,000 gold and sub-$13 silver, in the hopes of generating readership and trade commissions. Remember, not only is “deflation” a myth in fiat currency regimes (how’s your cost of living doing?), but even if it were real (other than gasoline prices, which constitute a very small, albeit high profile, portion of one’s budget), Precious Metals have always been the best performing asset class during such periods. Let alone, when prices have already been pushed well below the industry’s cost of sustainability; and for the majority of mines, the actual variable cost of production.

As they say, “buy low and sell high.” And if today’s historically low prices – relative to worldwide fiat currency outstanding; mining economics; and political, economic, financial, and monetary uncertainty – can’t convince you today’s prices are “extremely oversold,” I don’t know what will. And, as always, if you do decide the time is now to protect your assets with the only real money the world has ever known, we hope you’ll call Miles Franklin at 800-822-8080,and “give us a chance” to earn your business.

PROTECT YOURSELF, and do it NOW!

Call Miles Franklin at 800-822-8080, and talk to one of our brokers.  Through industry-leading customer service and competitive pricing, we aim to EARN your business.

Supplemental Cartel Manipulation Proof

As Zero Hedge would put it, “presented without comment.”  Except, of course, this article from earlier today (Sunday afternoon)…

http://www.zerohedge.com/news/2014-12-14/sales-silver-american-eagles-rise-record-high-second-year-row

Yes, 77 “Sunday Night Sentiment” attacks in the past 78 weeks – whilst no other market materially moved.  Actually, tonight took a full two hours before the typical Cartel raid; with oil sitting at the same -1% level as it opened at two hours ago, as opposed to most weeks, when the attacks start within 15 minutes of the ultra-thin Sunday night open (if that long).

Think these monsters aren’t terrified?  Amazing how much more intense the attacks became in the weeks leading up to the Swiss vote; let alone, now that the END GAME of global economic collapse is upon us.

Why am I writing this – on Sunday night, as Diana is cooking dinner?  To let you know just how desperate TPTB have become to prevent the “Achilles Heel of the Financial World” – i.e., silver, from doing NOW what it must inevitably do, sooner or later…

Sunday Night Open 11-2

Friday Night Open 11-7

Sunday Night Open 11-6

Thursday Night Open 11-13

Sunday Night Open 11-16

Thursday Night Open 11-20

Sunday Night Open 12-1

Sunday Night Open 12-14

And remember, gold is up for the year – by 1% in the U.S., and on average, 5% in the rest of the world (as you’ll see in my next article).  And as for silver, demand has NEVER been higher – or the outlook for supply EVER so weak.

China Syndrome

It’s Monday morning, and hallelujah – we not only did we not see a “Sunday Night Sentiment” attack for the first time in 40 weeks – as early attempts were rebuffed at the likely new floor level of $1,300/oz. but no “2:15 AM EST” raid occurred either.  Quite shocking and laughably, even the typically fantastic Zero Hedge attributed gold’s strength to “Ukraine fears” – as if the expanding instability in that dark corner of the Earth is “new news.”

24hr Gold Charts 5-4 5-5

So here we are, just days after another Fed “tapering” lie, COMEX options expiration, and the most blatantly fabricated NFP report in U.S. history; and lo and behold, PMs are trading higher.  Given their ragingly strong fundamentals, this should surprise no one with even a mild understanding of the reasons for – and mechanisms of gold and silver price suppression.  However, what really is puzzling and alarming to the highest order – is the fact that despite increased “tapering” – in our view, a lie to start with particularly given “Belgium’s” sudden Treasury buying surge; is the fact that Treasury yields, amidst a so-called economic “recovery,” have plunged to seven-month lows.

Bloomberg put out a story this morning that new pension rules will yield dramatically increased Treasury bond demand in the coming years.  However, its logic couldn’t be more ridiculous – in claiming:

Pension plans, which oversee $16.3 trillion, are shifting into longer-term Treasuries to lock-in last year’s stock gains by matching assets with their future liabilities as funding deficits narrow.

Bloomberg, May 5, 2014

In other words, selling stocks to buy bonds and yet, not a peep about how doing so would crush the stock market; much less, the fiduciary madness of purchasing Treasury bonds near record low yields, amidst record money printing, surging real inflation, and exploding Federal debt.  Granted, the fact that the Fed suicidally bought up a third of the entire Treasury market has tightened supply somewhat; but at such extremely overvalued levels, one would not expect such moronic “investment decisions” by the nation’s largest fiduciaries – particularly given the sea of sovereign red ink anticipated in coming years.  But alas, this is the bubble world the Fed has created which will continue in all its glory, until eventually it catastrophically collapses.

In many ways, Friday’s comical NFP report represented an inflection point in TPTB’s war against reality.  It was inevitable they’d eventually overplay their psychotic game of money printing, market manipulation and propaganda; and watching the Fed clearly attempting to push rates up may just well be the denouement of this suicidal exercise.  To wit, they no doubt anticipated the benchmark 10-year Treasury yield to jump back to the middle of their “managed” 2.6%-3.0% range when the BLS published the “huge” 288,000 job number.  However, once the market realized just how fabricated the data was – and how ugly the internals underlying it – rates instead plummeted; and by late afternoon, were on the verge of breaking below the seven month-low of 2.60%.  Eventually, the Fed lost this game, as the “quintuple bottom” at 2.60% was broken with rates this morning falling further to 2.57%, and appearing likely to fall much lower.

And why, you ask, is such lunacy continuing?  Yep, expectations the Fed will not only end its “tapering” pretense in the near-future, but increase QE as it becomes painfully clear no recovery is present; nor ever was, or will be until the cancerous fiat currency regime, once and for all dies.  Sure, the Cartel took some solace in capping Friday’s gold rise at exactly 1.0% at exactly the 10:00 AM EST close of the physical markets, at exactly $1,300 with a prototypical “Cartel Herald” algorithm – replete with late day “walk down” to $1,299.  However, this morning’s increase – albeit, again capped at exactly 1.0% – negates that “victory”; and given the above, may well mark an upsurge in global physical demand, well above and beyond last year’s historic levels.

The fact is, Central banks the world round have created bubbles in the world’s ugliest most toxic assets via “promises” to support insolvent entities from “too big to fail” banks to sovereign Treasuries themselves.  To wit, we have long documented how several PIIGS’ sovereign yields are now, insanely, below those of U.S. Treasuries care of Draghi’s July 2012 promise that the ECB would do “whatever it takes” to save the Euro.  Ultimately, the largest bubbles of all are the currencies themselves which in due time – perhaps much sooner than most can imagine – will collapse like the 599 before them.  David Stockman, a former Budget Office Director in the Reagan Administration, recently wrote a series of fantastic articles discussing such, like this one – describing the sorry state of the American consumer, per below…

Time wrote at the end of January:

 Too many of us are living paycheck to paycheck. The CFED, or Corporate Federation of Enterprise Development, finds that 44% of Americans are living with less than $5,887 in savings for a family of four. The plight of these folks is compounded by the fact that the recession ravaged many Americans’ credit scores to the point that now 56% percent have subprime credit.

Davidstockmanscontracorner.com, May 1, 2014

…and this one depicting the abject failure of Japan’s “Abenomics” – per below…

In a survey of 1,000 consumers on March 29-30 by broadcaster Fuji News Network, 69% said they had not made any special purchases ahead of the sales tax rise, and 77% said they didn’t feel an economic recovery was under way.

Zero Hedge, May 2, 2014

However, the most damning of all – inspiring today’s article – was this dire depiction of the ongoing Chinese economic collapse, per below…

The borrowing, building and speculating mania in China has obviously gotten so extreme that even the new regime in Beijing has been desperately trying to cool it down. But this will end up as a catastrophic failure—not the ‘soft landing’ brayed about by Wall Street bulls who do not have the slightest comprehension of the difference between free market capitalism and the phony ‘red capitalism’ that has been confected by the party-controlled apparatus of the massive, intrusive, bureaucratic and hierarchically-driven Chinese State.

Davidstockmanscontracorner.com, May 2, 2014

Essentially, it describes the unprecedented real estate and construction speculation the Chinese government has fostered via unfettered money printing and lack of regulation of “shadow banking” lending.  To the end of siphoning every imaginable job from the West, the Chinese government has indeed succeeded.  However, in using such destructive fiscal and monetary policies – ironically, not much different than those employed by its Western peers – it has created the largest economic bubble in human history.  We discussed such madness in March’s “Most Terrifying Article We’ve Ever Read” – as well as the terrifying ramifications of the PBOC’s decision to allow the Yuan to further weaken in April’s “Chinese financial torture.  However, given the importance of this potentially world-destroying event it makes sense to explore the issue from Stockman’s unique angle as well.

And given the universal “karma” of writing of the TRUTH, take a look at the Chinese news that emerged simultaneously; starting with a leaked recording from the Vice-Chairman of Vanke Group, China’s largest real estate developer – in which he stated:

It is a dangerous bubble, and already deflating’. China has reached its capacity limit for new construction of residential projects… and I don’t see any possibility for a rise in home prices.

Blogs.telegraph.co.uk, May 2, 2014

The below chart depicting parabolic growth in Chinese housing inventory confirms his fears, nearly doubling in the past two years…

Zero Hedge

…and this morning, China’s Manufacturing PMI contracted for the sixth month in a row at just 48.1 making an utter mockery of the government’s 7.7% GDP growth projection made just two months ago.  But the real shocker was news that Chinese home sales collapsed by an astounding 47% from a year ago, and an otherworldly 65% in “tier-2” cities…

  • 1st-tier city sales fall 40% y/y
  • 2nd-tier city sales drop 65% y/y
  • 3rd-tier and 4th-tier city sales decline 32% y/y

And thus, if anyone continues to harbor belief that somehow, somewhere, a miraculous economic “recovery” will save the day, it’s time to embrace the “realization of reality” rapidly sweeping the planet.  China has been the “world’s growth engine” since Western economies peaked at the turn of the century but sadly, as you can see such “growth” was largely funded with the same debt, money printing, and lax regulation that destroyed the United States, Europe, and Japan.  The “China Syndrome” is now melting down and with it, TPTB’s last remaining prayer of salvaging its failed gambit of unprecedented money printing, market manipulation and propaganda.

Under such a scenario, how can anyone not consider protecting their net worth with at least a modicum of “financial insurance”; i.e., real money?  To wit, gold and silver are decidedly NOT “investments”; but instead, the only assets known to have survived through 5,000 years of recorded history – as opposed to fiat currencies, none of which have survived more than 50 years without either collapsing or significantly devaluing.  With global economies plunging, money printing, inflation, and social unrest surging and debt levels of all kind rising parabolically, it’s only a matter of time before the dollar-based standard dies as well – and with it, the “Cartel’s” ability to artificially suppress gold and silver prices.

New Year’s Precious Metal Reality Check

It’s New Year’s Eve morning, and I had planned on taking the day off from writing.  However, given the incredibly blatant Cartel attacks of the past two days, I thought a PM “reality check” was in order.  First, we experienced the 20th “Sunday Night Sentiment” attack in the past 21 weeks; yet again, with the quite obvious intention of holding silver below the $20/oz. “line in the sand” erected six weeks ago.

24hr Gold 12-29-2013 1946

Next, the Cartel executed its third blitzkrieg attempt to break the June gold and silver lows of $1,182/oz. and $18.50/oz., respectively; conveniently, on the year’s final day, per this DEAD ON comment by Zero Hedge:

It seems someone wants the status-quo-defying precious metals going out at their lows, as central-planning-supporting stocks go out at their highs.

-December 31, 2013

I mean, you simply had to see this one to believe it; as with NOTHING going on elsewhere, gold suddenly plunged $10/oz. in a matter of seconds – and silver, an even more incredible 3%.

24hr Gold 12-31-2013 848

But then again, in this “year of infamy,” silver has endured at least one 2+% PAPER attack on more than half of all trading days.  And as you can clearly see below, most of such attacks were utilized to cap silver rises; as despite 135 such intra-day attacks – out of 252 trading days – on only 33 occasions did silver actually close at least 2% lower.  FYI, the “Dow Jones Propaganda Average’sonly 2+% down day was on June 20th – i.e., the day the Fed first hinted it might taper QE, when the PPT allowed it to fall a whopping 2.3%.

Blue Graph

Whilst this fraudulent, manipulative paper naked shorting was ongoing (I’ll get to the “happy conclusion” shortly), the COMEX December gold contract went off the board.  Roughly 660,000 ounces stood for delivery this month, very little of which has yet left the COMEX warehouses.  And thus, unless JP Morgan magically comes up with a new source of supply in the next few days, the COMEX’s registered gold inventory will likely end the year at no more than 200,000 ounces – worth $240 million at current prices.  Better yet, last year’s February contract was as big as the December contract.  And thus, with 223,000 contracts currently open – representing 22.3 million ounces of gold – the odds of a February “default event” grow exponentially larger.  FYI, assuming the Fed is actually printing $75 billion/month (last week, I proved that amount is closer to $130 billion), its daily “production” is roughly $250 million; i.e., the value of the entire COMEX registered gold inventory.

Comex Warehouses 12-30-2013 1200

Meanwhile, the year ended with yet another explosive burst of global PHYSICAL buying, as characterized by these dramatic Chinese pictures.  I initially wrote of China’s “irrefutable physical gold reality” from Guangzhou (Canton) in August; and if these photos of “holiday shopping” don’t drive the point home, I don’t know what will.

Based on published data, Chinese physical gold imports will end 2013 at more than double 2012’s record levels, at roughly 1,200 tonnes (below data is through October); and who knows how much more demand the unpublished data would uncover?

Annual Chinese Gold Net Imports

Clearly, Chinese silver consumption is off the charts as well; as given a relatively weak year for U.S. demand, U.S. Mint Silver Eagle sales still exceeded 2011’s record level.  Of course it was the Chinese buying them; and likely the Indians as well, given that Indian silver imports will end 2013 at a record level as well, exceeding the previous high from 2008.

US Mint Silver Eagle Sales

As most readers know well, Indians have dramatically increased silver purchases in response to onerous gold import restrictions imposed by the soon-to-be-deposed Indian government; which itself, is likely seeing record demand as well, when incorporating the exploding Indian smuggling trade.  According to William Kaye, Indian gold imports could also total a staggering 1,200 tonnes in 2013, despite such restrictions.  But heck, you don’t need to take his word for it.  Just look at the surging PHYSICAL premiums being paid as we speak – of nearly 25% over the paper “spot price,” and draw your own conclusions.  FYI, total global gold production is roughly 2,700 tonnes; and thus, India and China alone will likely acquire ALL of it.

Equivalent US Gold Price 1494.16

Moreover, as Cartel banks like JP Morgan, Goldman Sachs, and Bank of America try to scare you into believing PMs are about to “crash,” we ask you to consider the largely ignored issue of fundamentals.  I don’t think anyone has focused more on PM cost of production than the Miles Franklin Blog – other than Steve St. Angelo at the SRSRocco report, of course; and I think fourth quarter mining “earnings” will bear this out in spades.  For gold, the “all in” cost of mining – i.e., mining and reserve replacement – is at least $1,500/oz., per this quote from Gold Fields’ CEO, Nick Holland (Gold Fields is the world’s fourth largest gold producer).  As for silver, St. Angelo proved prices must be above $25/oz. to enable the mining industry to produce positive cash flow; and thus, at current levels, we anticipate dramatic mine closure announcements in the coming months.  Heck, silver industry capital expenditures are down 62% in 2013 alone; and as for 2014, look out below at the current price levels.

Worse yet, mining companies typically update their reserves at year-end.  And thus, when fourth quarter earnings reports are released, we expect dramatic reserve reductions across the entire industry.  In other words, proving economic gold and silver “ceases to exist” at current prices.  According to this Financial Times article, for example, industry leaders Barrick Gold and Newmont Mining assumed prices of $1,500/oz. and $1,400/oz., respectively, for the majority of their 2012 reserve calculations.  And trust me, if the world’s two largest gold miners – owning many of the world’s low-cost mines – will be dramatically cutting reserve estimates, you can imagine what “the rest” will do.

Irrespective of what the Cartel attempts in the paper markets in 2014, this “reality check” should make it crystal clear that the “shelf life” of such manipulations has never been shorter.  Physical demand has never been stronger; nor has the political, economic and social factors weighing against fiat currency and for real money.  Per our “2014 predictions,” the odds of a further separation between paper and physical prices in 2014 are extremely high; as inevitably, reality will win out – as it always does.

To end the year on a particularly positive note, here is how the PM markets reacted to the Cartel’s latest attempt to break the June lows – whilst interest rates broke out to a new multi-year high.  The more the Cartel fails to break the metals, the stronger the price support; and thus, the greater the odds of a true, sustainable bottoms.  Although, if they actually do manage to break those lows, they will simply accelerate the PHYSICAL drain that will ultimately destroy them.   FYI, I bought more PHYSICAL silver this morning; and hopefully, you too will realize that NEVER in history have prices been more inexpensive.

24hr Gold 12-31-2013 1048

From the entire Miles Franklin team, we wish you a happy, healthy, and prosperous New Year.  And as always, we ask you to “give us a chance” to earn your business!

The Mainstreaming of PM Manipulation

It’s 3:00 AM EST Monday morning, and I couldn’t sleep.  Naturally, with absolutely zero material news or overnight action in the global capital markets, we’ve been treated to perhaps the 20th straight “Sunday Night Sentiment” PM attack – followed by the 140th visit from the 2:15 AM EST suppression algorithm in the past 154 days.  Frankly, I’m just looking forward to 2013’s end; as never in my 24-year career have I been more frustrated, or angry.  Western governments, led by the United States of Dying Hegemony, have taken over all financial markets for the moment, ruling them with an iron fist.  As former Assistant Treasury Secretary – and current Freedom Fighter – Paul Craig Roberts notes it is simply unfathomable how such criminality remains largely ignored by the Western MSM.  And not just in the gold and silver markets, but all forms of information dissemination and “price discovery.”

24hr Gold 12-22 12-23

Fortunately, the laws of “Economic Mother Nature” cannot, and will not, be repealed.  Clearly, something extremely extraordinary is going on the global physical markets, as the trend toward collapsing gold inventories has reached crisis levels.  To wit, on Friday alone, another 13% of the COMEX registered inventory disappeared, leaving a record-low 432,000 ounces supporting the entire Ponzi scheme, worth a piddling $500 million at today’s prices.

Comex Warehouses Registered

Moreover, by year-end, it’s entirely possible that no more than 100,000 ounces will remain, in light of additional December contracts still standing for delivery.  Meanwhile, Shanghai Gold Exchange volumes have recently exploded, suggesting additional, massive physical deliveries in the coming weeks; whilst Indian gold premiums have surged to a record 23.5% above the Western “spot price.”  In fact, Paper PM prices have been suppressed so extraordinarily, that despite the most positive supply/demand fundamentals of our lifetimes, major mining companies are cutting staff, capital expenditures, and production en masse.

US Gold Price Graph

Something’s got to give in the coming weeks and months; and when it does, it may well be historic – per Friday afternoon’s quote from the great Andrew Maguire:

In the real world, wholesalers were the busiest in months yesterday, and they are run off their feet again today.  Looking at the charts, that’s really counterintuitive to what’s happening.  There is enormous demand sub-$1,200, and these divergences cannot last much longer.

This enormous leverage employed by these paper market sellers is a distortion of what’s really happening.  We’re stretched so far that the unwind and the rebound higher is going to be disorderly, as sovereign and central bank buyers continue to milk Comex based leverage selling. 

They are busy converting this resulting spot price into physical (gold) at the painted fixes (in London).  This physical latency will catch up in a very disorderly way the moment the downside momentum wavers.  And we’re reaching the point where we can see that change in behavior is beginning to become evident.

King World News, December 20, 2013

Maguire mentions the aptly named London “fixes”; which for years, I have cited as the Cartel’s primary attack times – particularly the “PM Fix” at 10:00 AM EST, marking the end of the global Physical PM trading day.  Amazingly, throughout a 13-year bull market, gold is actually net down during the ensuing “paper” period – particularly, New York COMEX trading; and finally, the word is getting out.

Last month, it was reported by Bloomberg, the Wall Street Journal, and other MSM outlets that the PM fixes were being investigated for trading improprieties, surrounding the five firms involved; i.e., Barclays, Deutsche Bank, Bank of Nova Scotia, HSBC and Societe Generale.  The fact that Barclays was the central figure in last year’s LIBOR rigging scandal only makes things that much more suspicious; let alone, that HSBC is custodian of the controversial GLD gold ETF, and Bank of Nova Scotia one of the three main COMEX depository managers.  Frankly, I don’t expect TPTB to allow the investigation – which, ironically, includes the U.S. CFTC – to conclude anything substantial.  However, in our view, the fact it is getting such widespread attention may well prove a “tipping point” in the battle between the fraudulent paper and real physical markets.

Thus, I was extremely encouraged by this follow-up article by Bloomberg on Thursday, highlighting what we view as by far, the most damning evidence against the paper manipulators.  Long-time Miles Franklin Blog readers are well aware of the fine work of European analyst Dmitri Speck, who has charted every single day of gold and silver trading over the past 15 years; i.e., since former Treasury Secretary (and Goldman Sachs CEO) Robert Rubin famously espoused America’s to-this-day-ambiguous “strong dollar policy.”  Bloomberg actually published his infamous chart memorializing the unnatural suppression of prices at both the AM and PM “fixes”; asking the obvious question of how these banks’ manipulative activities can be stopped.

In the excellent 1997 movie Contact, Jody Foster travels through a wormhole to a distant galaxy; where she meets an alien being, asking him how their respective races’ relationship would progress.  He tells her “in baby steps”; indicating that in time, all will be revealed – which is exactly what is going on in the heavily manipulated Precious Metal markets.  In other words, in time, the entire world will be aware that archaic paper exchanges like the LBMA and COMEX are not only obsolete, but rigged.  Better yet, it won’t take “ages” to occur; as the Cartel’s “Achilles Heel” of collapsing physical supply, amidst surging physical demand and prices below the cost of production – may well cause such “enlightenment” to occur much sooner, and more explosively, than most can imagine.

From this summer’s depths, at $1,182/oz. gold and $18.50/oz. silver – i.e., not far from this morning’s levels – prices suddenly surged to $1,430/oz. and $25.00/oz., respectively, in just a month’s time.  Will this happen again in early 2014?  We have no crystal ball, of course.  However, it’s difficult to believe it won’t; as the proverbial “beach ball” has never been held this far underwater – amidst a political, economic, and social environment in which any number of black, “grey,” or other types of “swans” are lurking.  And even if we wait somewhat longer for this inevitable validation, the opportunity to protect one’s assets from the long-term inflation guaranteed by cornered Central banks has never been better.  No inflation, you say?  Then how is it that both chicken and beef prices hit all-time highs last week – with the prospect of Obamacare’s widespread launch driving the world’s highest healthcare costs exponentially higher?

Just like any other inexorable trend, the “mainstreaming of PM manipulation” will spread the world until ultimately, the so-called “arbitrage” between physical and paper prices is resolved – in the favor of the “path of least resistance”; i.e., materially higher levels.  Unfortunately, such an event will also be accompanied by the realization that “money” as we have known it is dying; at which point, either you will have safeguarded your financial future with real money or forever lost the chance – certainly at prices even remotely near today’s historically suppressed levels.  As always, we encourage you to do your own due diligence; and please, utilize Miles Franklin as a resource whenever possible.  Remember, our goal is to educate, assist, and of course, broker any future transactions you decide to make.  We have been doing just this for 24 years – without a single registered complaint with the Better Business Bureau; and strive to be the most competitive, service-oriented, and respected name in the bullion business.

The Dow-Gold Paradox

For the entirety of my “TEN YEARS OF HEAVEN AND HELL” – soon to be eleven – I have endured the ignominy of Cartel PM attacks.  Starting with “SUNDAY NIGHT SENTIMENT” raids, to the KEY ATTACK TIMES of 3:00 AM EST, 8:20 AM EST, 10:00 AM EST, and 12:00 PM EST; and more recently, 2:15 AM EST and 7:00 AM EST – I have seen it ALL.  Sadly, such “operatives” are becoming more frequent and intense; as TPTB realize the END GAME of fiat currency collapse is rapidly approaching.

On a daily basis, it appears PMs are ALWAYS down; morning, noon, and evening.  Nearly EVERY time I walk into the gym, down they go; or anytime I jump into my car; or look at my screen.  Just watch CNBC in the morning; and you’ll see that nine out of every ten times “gold” pops up on the screen, it immediately ticks down.  Moreover, ninety-nine times out of a hundred, when I click on my Kitco app, gold and silver immediately decline.  And perhaps 999 times out of 1,000; when gold re-opens in the ultra-thin “Globex” electronic market at 6:00 PM EST, the first tick is down.

Thus, it seems quite the paradox that gold and silver are the WORLD’S BEST PERFORMING MARKETS over the past 12 years; rising, on average, by 17%-20% – and in gold’s case, NEVER having a down year…

despite the fact that during New York trading hours – when 99% of ALL significant price moves occur – gold is net DOWN over this period.  FYI, the 10:00 AM EST WATERFALL DECLINE in the chart below represents the afternoon “P.M. Fix” in London; when PHYSICAL trading ends for the day, and (naked shorted) PAPER trading dominates…

Conversely, the “DOW JONES PROPAGANDA AVERAGE” appears to ALWAYS be higher; no matter the news or time of day.  For the past decade, I estimate Dow futures have been called higher or barely lower on 99% of all trading days; compared to no more than 50% for PMs – despite the aforementioned bull market.

Despite the “perma-green” status perpetrated on the Dow by the “President’s Working Group on Financial Markets,” the WORLD’S MOST WIDELY VIEWED INDEX has barely risen in the past 12 years.  Moreover, if you exclude the survivor bias of deleting bankrupt or reorganized companies like General Motors, AIG, Citigroup, and Eastman Kodak, the Dow would likely be down over this period…

Of course, if you adjust the Dow for INFLATION, it is down significantly; by 28% utilizing the government-published CPI Index, or 35%+ including GM, AIG, C, and EK…

…and an astonishing 67% (or 75%+ including GM, AIG, C, and EK) when incorporating TRUE inflation statistics, as measured by John Williams of ShadowStats.com

…per the chart below; perhaps one of the most important you will ever see…

It’s difficult to comprehend how the PPT can keep the Dow higher nearly all the time without it meaningfully rising.  Conversely, PMs nearly always appear to be down; yet, year after year, end up higher.  Thus, the “DOW-GOLD PARADOX”; which defines the TPTB’s strategy of keeping investors away from assets that PROTECT them, and in investments that HARM them.

So long as you realize their “Achilles Heel” is the lack of available PHYSICAL gold and silver (utilized to suppress prices), you will NOT fall prey to this trap; and thus, be SAVED when other assets – government-supported or otherwise – FAIL.

PROTECT YOURSELF, and do it NOW!

Call Miles Franklin at 800-822-8080, and talk to one of our brokers.  Through industry-leading customer service and competitive pricing, we aim to EARN your business.

The Most PiMBEEB Transaction Of All-Time

Monday mornings can be daunting, in processing the massive amount of PiMBEEB – or Precious Metal bullish, everything-else-bearish – news since my last publication, 72 hours earlier.  This, amidst a world where government-commandeered “markets” signal nothing but the madness they have created, and the carnage that must surely ensue – as if generational economic weakness; the highest-ever debt load; the largest-ever industrial oversupply; the lowest-ever cumulative purchasing power; and the highest level of political, geopolitical, and social unrest in generations isn’t carnage enough.  But alas, the rapidly accelerating, guaranteed-to-fully-run-its-course implosion of history’s largest, most destructive fiat Ponzi scheme is in truly unprecedented territory; featuring history’s largest-ever bubbles – and in Precious Metals’ case, “anti-bubbles”.

Today’s principal topic is as important; far-reaching; and per today’s title, PiMBEEB; as anything I’ve yet discussed.  Thus, the best way to preface the most PiMBEEB transaction of all-time, is to simply list the past 72 hours’ events – to demonstrate just how rapidly the powers that be’s “control” is being lost.

  1. The Illinois Death Watch is on – as following last week’s downgrade to one notch above junk, state Comptroller Susana Mendoza said “this is not a false alarm, we are in massive crisis mode. The magic tricks run out after a while, and that’s where we’re at.”  “Magic tricks,” eerily similar to the “extraordinary measures” the Treasury is currently taking – i.e, plundering pension funds, and creating fraudulent interdepartmental transfers – to buy a few more weeks, before the “mother of all debt ceiling crises” arrives.
  1. Heightened military escalation; as the U.S. bombed Syria – prompting Russia to cut off diplomatic ties, citing such as act as “supporting terrorism”; whilst Iran and China conducted joint naval drills; NATO simulated a Russian invasion; and America pondered the deployment of an additional 20,000 troops to Afghanistan.
  1. Escalating political chaos, as the odds of a Trump impeachment hearing increase further each day. Not to mention, the chaotic aftermath of last week’s “shocking” UK election – and yet another London terrorism incident.
  1. The accelerating collapse of Saudi Arabia’s finances, as the OPEC “production cut” agreement collapses – as highlighted in this Steve St. Angelo article, discussing what I have exhaustively harped on for the past year. e., America’s desperate need to support the collapsing petrodollar complex, as its only Middle Eastern “ally” inches dangerously close to political and economic chaos.

This, as rigged financial markets are blatantly, and dramatically, supported – as evidenced by the past four days’ “trading”; in which, amidst a Fed “rate hike” and “balance sheet normalization” proposal that NO ONE can make sense of, given how U.S. economic data is unquestionably at its post 2008-crisis low; interest rates are within two basis points of their post-Election lows; and the dollar is essentially at its post-Election spike bottom low.  To wit, Minneapolis Fed President Neel Kashkari said all you need to know about the “control” the Fed has, and the understanding – or better put, denial – of the mess they have made…”for me, deciding whether to raise rates or hold steady, came down to a tension between faith and data.”

To that end, it’s shocking to consider dislocated today’s historically manipulated markets are – as nothing is being allowed to reflect reality.  Particularly, “last to go” markets like paper Precious Metals and the “Dow Jones Propaganda Average” – the former of which, were subjected to their 189th “Sunday Night Sentiment” raid of the past 199 weekends; 857th “2:15 AM” attack of the last 978 trading days; and this monstrosity of “COMEX open”…

…whilst the Dow, following the disastrously timed Fed rate hike –  amidst collapsing retail sales, housing starts, home sales, building permits, and wholesale reports, and the aforementioned, soon-to-be-discussed “most PiMBEEB transaction of all time; continued to be relentlessly supported by the PPT’s “dead ringer” algorithm…

Seemingly everywhere one looks, these epic, unprecedented “distortions” can be seen – from sophisticated derivative markets decidedly betting on lower interest rates; to unsophisticated investors making record bets on historically overvalued stocks and bonds, via the largest equity and bond fund inflows in a decade.  By nearly every quantitative metric available, stocks and bonds are as overvalued as at any time in history – whilst home builder sentiment, despite historic unaffo-rdability; higher mortgage rates; and collapsing sales, permits, and starts, has reached its highest level since the peak of the 2007 real estate bubble.  This, as gold prices have been suppressed to all-time inflation-adjusted lows; the silver/gold ratio, to its most egregious undervaluation ever; and the platinum/gold ratio to a fresh all-time low.  And I haven’t even gotten to today’s very, very important topic – which I assure you, will ignite already historic Central bank money printing like a match to a gasoline tank.  I.e, Amazon.com’s shocking acquisition of Whole Foods – which in my view, is easily the most PiMBEEB M&A transaction of all time.

To wit, my long-standing commentary of the dramatic changes the world is experiencing – due to technology, demographics, financial reality, and a rapidly changing zeitgeist.  My focus on such historically unprecedented change goes back more than a decade, when I first noticed how many consumer goods were “made in China” – all the way to the present, in being one of the first people to recognize, and publicly discuss, the historic, world-changing ramifications of crypto-currency.

More than at any time in history, staples of life – and mindsets – are being radically, irreversibly altered, to make way for a 21st Century that, by the time its halfway through, won’t even resemble its beginnings.  To wit, in June 2016’s “here’s the real end game,” I first espoused my view that history’s largest, most destructive fiat Ponzi scheme would be replaced by crypto-currency – with Precious Metals re-claiming their historic role as the world’s best storage of value assets; whilst in February 2017’s “shocking new world order,” I spoke of how the world our children inherit won’t even resemble the one we grew up in.

Technology is changing so rapidly, today’s world will barely be recognizable a few years from now.  And I’m talking about essentially all aspects of life; from cars, to real estate, insurance, education, and healthcare, to name but a few; to, of course, money.  In other words, not only is it becoming mathematically unlikely that your children will attend college; but that they’ll ever own a car – or a driver’s license, as self-driving cars become ubiquitous.  Or that we’ll need to see doctors when we’re modestly sick, now that medical Tricorders – a la Star Trek – are being invented.  Or that my five-year old, Sylvie, will ever have a “bank account” – or use “cash” for a transaction.”

Typically, technology changes improve society’s cumulative experience.  However, when society’s natural progression – and “Economic Mother Nature’s” immutable laws – are unnaturally altered, the impact of technology can be just as disruptive and destructive as it is beneficial.  Which is exactly where we stand today, given that the deflationary, employment-killing tsunami Amazon/Whole Foods represents will irreversibly wash over history’s largest, most destructive fiat Ponzi with a speed – and relentlessness – unlike anything witnessed in global economic, monetary, political, geopolitical, and social history.

In a world where historically debt-laden, savings-starved, and hope-deprived citizens value price more than anything, the trend toward cost cutting is about to take ten giant leaps forward – aided by robotics and logistics technology that could eliminate half of the world’s jobs.  Amazon’s leadership in these areas has already destroyed, permanently, countless business models.  However, it wasn’t until Friday’s Whole Foods acquisition that Amazon’s world-changing ambitions was finally brought to light – to the point that even uber-cheerleader Jim Cramer; who practically begged the Fed to address the collapsing banking system in early 2008, had the following to say about it.

If I was the Federal Reserve, I would have a meeting on this. Inflation is going to go down…You have to rethink food … Costco knows how to compete…but Kroger, a crisis in Cincinnati, crisis!”

Yes, retail food stocks of ALL kinds were decimated Friday – from Costco and Target; to pure Whole Foods competitors like Sprout’s; anachronistic supermarket chains like Kroger; and even Wal-Mart itself – which was already bracing for cut-throat European competition from German mega-discounter Aldi.  This, amidst an already crisis level of industry profitability, and collapsing restaurant demand.  Frankly, an unprecedented reaction to a major M&A transaction – although arguably, there is no transaction even remotely comparable, in the history of U.S. finance.

The reason being, that Amazon has brought to light – along with the amazing technology advances and corporate efficiency its business plan will bring – the horrific debt, employment, and supply chain destruction it will yield.   Which as noted above, would be fantastic if it occurred organically, in a free market environment featuring strong economic health.  However, the economic hell wrought by historic government and Central bank intervention will yield financial carnage unlike anything seen before – as countless dozens of companies are bankrupted; millions of jobs are permanently lost; billions of entitlements are demanded of insolvent governments; and trillions of fiat currency units are printed to “monetize” these needs.

Unquestionably, resulting in dramatic inflationary increases, at a time when the world has never – at least, since Feudal times – been as polarized by Central bank-fostered wealth disparity than at any time in history.  In other words, an historic “PiMBEEB” environment, at a time when physical Precious Metal demand is near its all-time high; production is in terminal decline; and above-ground, available-for-sale inventories are “running on fumes.”  To which point I can only say, why are you NOT considering the protection – and insurance – of your hard earnings savings, and NOW?

Platinum, The Forgotten Precious Metal-Revisited

My good friend Adam Meister – i.e, the “Bitcoin Meister” of (rapidly increasing) YouTube fame – sagely stated today, “you get rich slowly, and poor quickly” – which goes double for those utilizing traditional valuation metrics in historically manipulated markets.  Fortunately, no financial manipulation, throughout the course of history, has ended well; and now that the “custodians” of history’s largest, most destructive fiat Ponzi have reached their ‘trapped rats on a sinking ship’ moment, the “dotcom valuations in a Great Depression” their financial Frankenstein monstrosity has created have put the entire world at the edge of an irreversible abyss.

Fortunately, “value” – like what is present in today’s historically low inflation-adjusted Precious Metal prices; and equally undervalued silver/gold ratio; doesn’t vanish because the powers that be want it to; any more than “pigs” – like the vast majority of Western stock, bond, and real estate markets; or PIIGS – like Italy, Spain, and Greece; can be “beautified” by Central bank monetization, overt or covert.  In Precious Metals’ case, the manipulation that has been ongoing for decades has caused exponential demand growth – such as, for instance, a five-fold increase in U.S. Mint Silver Eagle sales from the 2007 pre-financial crisis level; plunging mine supply – as evidenced by consensus forecasts of a 20% gold production decline through 2024; and vanishing above-ground, available-for-sale inventories – per COMEX’s registered inventory plunges of 74% for gold – since September 2011’s “Operation PM Annihilation” raid; and 60% for silver, since the 2008 financial crisis.

This, as money printing has reached an all-time high – at $200 billion per month, excluding “off balance sheet” activities; whilst the average “interest rate” has been taken to around ZERO.  Which is probably why the average currency has lost half its purchasing power since the 2008 crisis; whilst debt has parabolically surged; amidst the worst economic conditions of our lifetimes, the greatest cumulative oversupply; and the weakest demographic trends in modern history.  Just watch this 14-minute documentary about history’s largest asset bubble – the Chinese “ghost city” experiment – if you want to know why government intervention always ends badly; why we own physical Precious Metals; and why they must protect us in the coming years, no matter how hard the powers that be try to suppress them.  I mean, what part of the Zero Hedge headline that just emerged, as I edit, says anything but “buy Precious Metals?”

And by “suppress,”, I mean blatancy even I have never witnessed; starting Wednesday, when paper gold was attacked at the 12:00 “cap of last resort,” mere minutes after hitting a new 2017 high, with the key psychological level of $1,300/oz in spitting distance; following the horrifying DOE inventory report that caused crude oil prices to precipitously plunge.  Next, on Thursday, 90 minutes after the ECB took Central bank credibility to a new low by “unexpectedly” lowering its inflation forecast – at the Cartel’s “key attack time #1” of 10:00 AM EST, no less – “someone” dumped $4 billion of paper gold on the COMEX (i.e, four times more than its available-for-sale inventory) to push it below its 5½ year trend line, at roughly $1,274/oz.

Followed by Friday – gee, that chart looks eerily like Thursday’s, and countless other “trading” days before it – when gold suddenly plunged at 10:00 AM EST, when the historically overvalued tech stocks finally declined significantly, for the first time in memory.  To that end, how can the “Dow Jones Propaganda Average” have risen 70 points, whilst the NASDAQ plunged 113?  The answer being, TPTB are so terrified that their historic Ponzi scheme will spectacularly implode, they’ll do anything to stem the tide, no matter how obvious their actions become.

And for those that believe gold declined because of the “shocking” UK election result – which I mocked in great detail Friday – the fact that the Conservative Party lost so many seats had nothing to do with BrExit; which, if anything, is more assured following Thursday’s election result.  To the contrary, it was the young people that came out in droves to vote for the Labour Pary – not because they oppose BrExit, but because they are desperate for the greater amounts of “free” entitlements Labour promised, in yet another nation experiencing dotcom valuations – that principally benefit the “1%” – in an increasingly Great Depression Era.

As for today, aside from the 188th “Sunday Night Sentiment” raid of the past 198 weekends – trust me, NOTHING was going on when the “Cartel Herald” showed up at the Cartel’s favorite evening attack time, 8:00 PM EST; PMs has been attacked repeatedly, in a chart formation nearly identical to Wednesday’s; with the coup de gras occurring at – yep, 10:00 AM EST, when gold dared turn positive, amidst the accelerating tech stock decline.  Which “magically” reversed via prototypical “dead ringer” algorithm – at exactly the 10:00 AM time-stamp of the Fed’s “open market operations.”

News-wise, it’s the usual PiMBEEB onslaught – featuring the accelerating collapse of Spain’s eight largest bank, LiberBank; just two days after its sixth largest bank, Banco Popular, had its entire publicly-held debt load bailed-in, and its entire equity destroyed by an ECB-orchestrated “take under,” for the princely sum of ONE EURO.  But don’t worry, Europe’s economy is “growing,” and nothing bad could possibly happen with European stocks and bonds at all-time high valuations.

And what’s that you say?  U.S. restaurant sales and traffic “unexpectedly” declined for the 15th straight month – whilst state tax receipts plunged the most since the 2008 financial crisis?  And how about the “tax cuts”; “fiscal stimulus”; and Obamacare “replace and repeal” that were supposed to spur “Trump-flation”’; save America; and justify the highest-ever stock, bond and real estate valuations?  Or the debt ceiling we’re to hit in a few weeks?  Or the exploding political dysfunction and infighting that are tearing America’s government – and social fabric – apart?

Or the record household debt – amidst surging student, auto, and credit card loan delinquencies and defaults.  And parabolically rising bankruptcy filings, amidst across-the-board plunges in essentially all economic data?  Or the rapid dismantling of the investment theses of the market’s leading companies, from Tesla to Uber to the mighty FANGs?  Or exploding geopolitical tensions in North Korea, Syria, and Qatar, to name but a few?  Or the 22 “leading” economists urging the Fed to increase its maximum inflation threshold, so more money can printed?  But don’t worry, none of these issues are worth considering, as they can’t possibly yield “risk asset” selling or safe haven buying.  And oh yeah, the Fed – which meets again Wednesday; – will raise rates to the sky and shrink its balance sheet – in a parallel world, featuring unicorns, leprechauns, and benevolent investment bankers.

All that venting aside – of the frauds that will be exposed, and the manipulations that must be unwound – I want to move on to today’s principal topic, the extreme undervaluation of platinum.  To that end, today’s article is a follow-up to the first platinum, the forgotten Precious Metal article” – penned in January 2016, just three days, and five percentage points, from its ultimate bottom at $820/oz.  Subsequently, it rose as high as $1,175/oz in August – when Precious Metals experienced their last Cartel-induced “interim peak”- before falling to today’s ultra-cheap $940/oz.

At the time, my heightened interest in platinum – which in small amounts, should be a part of any significant-sized Precious Metal portfolio – was due to the fact that not only has it had a 90-plus percent directional correlation with gold and silver for years, amidst an environment featuring the lowest gold and silver prices since 2009; but that the platinum/gold ratio itself had become severely undervalued – having fallen to a 17% discount to gold, after spending four decades trading at an average 22% premium.

After the 43% surge in 2016’s first six months, not only has platinum’s price “corrected” with gold and silver; but the aforementioned correlations have dislocated as never before – like the gold/platinum ratio, which has since risen from the 1.22 level at the time of last year’s article to 1.34 today, matching the all-time high achieved during one spike-top week in late 1982.  This, despite a “Trump-flation” fostered base metal bubble that is finally showing signs of deflating – amidst the complete, and increasingly well-understood, realization that not only was Trump-flation a fraudulent meme to start with, but that its principal tenets (per the aforementioned Treasury auction headline) are collapsing into the either.  As let’s face it, platinum – like copper, lead, zinc, and the other “Trump-flated” base metals – is principally an industrial metal; and thus, should do at least as well as its “twin brother” palladium; given that both metals’ principal usage is in automotive catalytic converters, with platinum having the additional “use case” of being a time-tested “quasi monetary metal.”

To wit, platinum and palladium are so tied at the hip, they are only mined together, at essentially the same minuscule rate, with the same ominous production outlook.  Not to mention, roughly three-quarters of platinum and palladium production occur in South Africa – a political and electricity basket case whose mining industry is in terminal decline, to the point that the Rand has collapsed to nearly an all-time low; the country is officially in recession; its credit rating was last week downgraded to one notch above junk; and its political situation is so chaotic, its illiterate President was nearly ousted last week, amidst rumors he intends to institute draconian private land confiscations.

According to Johnson Matthey, one of the mining industry’s leading consultancies, platinum mine supply peaked in 2011 at roughly 6,300 tonnes – which, put into context, compares to 2016 silver and gold production of 27,500 tonnes and 3,200 tonnes, respectively.  As you can see below, not only is platinum production not expected to approach the 2011 peak for the foreseeable future, but the physical market has been operating at a deficit for the past five years, with no end in sight.  In fact, platinum inventories are so scarce, Platinum Eagles bullion coins were discontinued by the U.S. Mint in 2008 due to a lack of supply – which they subsequently re-minted for one month each in 2014, 2016, and 2017; after which, they were in each case re-discontinued when sales reached the piddling level of 20,000 ounces.

This past week, the metals world has watched – in shock, to those well-versed in it – as an old-fashioned physical short squeeze has occurred in palladium; with no other metal, from platinum, to gold/silver, to the other base metals, reacting similarly.  No specific reason is understood to be the catalyst.  Yet clearly, palladium futures backwardation is signaling a significant supply shortage – to the point that, palladium’s price discount to platinum has fallen to an all-time low of just 8%, despite no material “reason” to explain it.  And trust me, much analysis has been put forth in the quest – per this article, published yesterday.

Considering the past week’s violent Cartel attacks; the aforementioned fundamental factors; and its historic undervaluation relative to gold – and palladium; it appears like a good time to diversify, or add to, your Precious Metal portfolio with platinum.  I have no doubt Precious Metal prices will rebound from today’s egregiously suppressed levels; and even if the gold/platinum ratio doesn’t fall all the way from today’s record 1.34 to its 40-year average of 0.84, I believe it will irrespective, fall significantly in the coming months; perhaps, if platinum, with essentially identical industrial fundamentals as palladium – with the additional “optionality” of quasi-Precious Metal demand – experiences its own physical short squeeze.

Historic Market Manipulation, Setting The Stage For Catastrophe

In 1989, as a college sophomore, I switched my major from biology to finance.  Immediately, I subscribed to the Wall Street Journal, and read the “C” section every day for the next ten years, without missing a day.  That is, until I got sick of its CNBC-like economic and financial market cheerleading, in the first sign of a burgeoning mistrust of the financial media, that has led to today – when, on a worldwide basis, I have become one of its most well-known detractors.  This, and the the entirety of the “mainstream media” – which, in sum total, has been commandeered by the “Deep State”; i.e., the politicians, bankers, corporate titans and billionaires who have literally bought the system – and subsequently, turned it into a playground of money printing, market manipulation, and propaganda, that has brought the global economy to the brink; and with it, unprecedented misery for “the 99%” not privy to their manipulations.

The average fiat currency has lost more than half its purchasing power in the past decade alone, whilst the “1%” on the receiving end of such ill-begotten – and thankfully, ill-fated – monetary and insider trading excesses – are enjoying “dotcom valuations in a Great Depression Era,” in everything from stocks, to bonds, and residential real estate.  The former two categories of which, the 99% own little or none of; and the latter of which, is driving home ownership (and rental) costs to unprecedented highs – in absolute prices, and relative to the average Joe or Jane’s increasingly dwindling savings.

In fact, the blatancy of Central bank “monetization” has become so blatant, that even with the Fed (for now) absent from the QE Ponzi – at least, per its official policy – global Central bank bond monetization is at an all-time high, at roughly $250 billion/month.  This, excluding stock monetizations by the Central banks of Japan, Switzerland, and Israel, to name a few, of who knows how many additional billions.  In fact, as I laid out in painstaking detail earlier this month – it’s not unreasonable to conclude that the Swiss National Bank, on its own, has done as much “equity QE” on the U.S. market as the Fed itself!  This, from a Central bank that in late 2014, begged its citizens to vote down the “Save our Swiss Gold” referendum, because it needed the “flexibility” to rig markets – like the Euro/Franc peg, which it abandoned just three weeks later.

Since entering the Precious Metals sector in May 2002 – exactly 15 years ago – it took mere weeks to realize it was rigged.  This, as I was just starting to realize that the stock market, too, was being commandeered – in the wake of the obvious “PPT” influences in the wake of 9/11, and the Worldcom and Enron collapses of 2002.  And by PPT, I mean the “President’s Working Group on Financial Markets”; inadvertently deemed the “plunge protection team” by disgruntled former Clinton advisor George Stephanopoulos, exactly one week after 9/11.

Well, what I wanted to talk about for a few minutes is the various efforts that are going on in public and behind the scenes by the Fed and other government officials to guard against a free-fall in the markets….perhaps the most important, the Fed in 1987 created what is called the Plunge Protection Team, which is the Federal Reserve, big major banks, representatives of the New York Stock Exchange and the other exchanges and they have been meeting informally so far, and they have a kind of an informal agreement among major banks to come in and start to buy stock if there appears to be a problem. They have in the past acted more formally… I don’t know if you remember but in 1998, there was a crisis called the Long-term Capital Crisis. It was a major currency trader, and there was a global currency crisis. And they, with the guidance of the Fed, all of the banks got together when it started to collapse and propped up the currency markets. And, they have plans in place to consider that if the markets start to fall.”

Yes, the PPT – created in the wake of the 1987 stock market crash, at the behest of the Fed’s brand new printer-in-chief Alan Greenspan; to supplement the long-standing, and far shadowier “Exchange Stabilization Fund”; around since 1933, with a mandate, altered as of 1970, a year before the gold standard was abandoned, “allowing the Secretary of the Treasury, with the approval of the President, to deal in gold, foreign exchange, and other instruments of credit and securities.”  In other words, the “U.S. headquarters” of the Cartel tasked with suppressing gold (and silver) prices to maintain “confidence” in history’s largest, most destructive fiat Ponzi scheme – spearheaded by its “supreme leader,” the Bank of  International Settlements in Switzerland, whose even shadowier activities rarely come to light; as they did during December 2011’s “Operation PM Annhilation II.”  When, with dollar-priced gold threatening to surge back to the all-time high achieved before September 2011’s “Operation PM Annihilation I” raid, the following headline coincided with an equally vicious paper PM raid at – yep, you guessed it, 10:00 AM EST – just after the ECB “unexpectedly” reduced interest rates.

  • MARKET SOURCES REPORT BIS, BOE & FEDERAL RESERVE WERE SELLING GOLD AFTER IT POPPED TO SESSION HIGH AT GMT 1335 – MNI NEWS via BLOOMBERG

The headline was subsequently taken down by MNI, one of Germany’s largest media organizations – and none of the entitities mentioned so much as commented on it – as clearly, it was clearly “swept under the rug” once the intended PM damage was done.  And wouldn’t you know it, neither the Fed, the U.S. Treasury, nor the Bank of England have since reported a reduction of so much as an ounce of their so-called “reserves?”  You know, the “reserves” that have essentially never been audited, and never will.

Back in 2003, when I became an (unpaid) contributor to GATA – i.e., the Gold Anti-Trust Action committee – I commenced what has become a lifelong effort to expose market manipulation, particularly in the Precious Metal market that has always been Ground Zero in the “Deep State” fight against sound money.  Which fortunately, has recently gained a powerful ally in crypto-currency; which, for entirely different reasons (albeit, with the same anti-Central bank roots), is fighting an eminently, and hopefully imminently, winnable war as well, against world-destrying fiat currency.  The evidence of PM suppression is as voluminous as it is damning – from last year’s Deutsche Bank admissions; to recently discovered documents discussing the true aim of the COMEX’s 1974 creation; to yesterday’s new bombshell documents from 1979-80, of Bank of International Settlements communiques regarding the how, and why, gold prices needed to be suppressed.

Fortunately for Precious Metal holders, the cumulative impact of five-plus decades of price suppression – going all the way back to the overt London Gold Pool of 1961-68 – has been the irreversible decline of mine production; the looting of above-ground, available-for-sale inventory; and of course, record-high demand, due to the aforementioned, inexorable collapse of purchasing power caused by the historic fiat Ponzi scheme the suppression of Precious Metal prices enabled.  Not to mention, the lowest inflation-adjusted PM valuations in global history (particularly for silver, as I discussed last week); whilst simultaneously, as noted above, upwardly-rigged financial markets have been manipulated to their highest-ever valuations, amidst the worst economic environment, and outlook, of our lifetimes.  Which I assure you, will get much worse as the historic overcapacity said fiat Ponzi caused is unwound – amidst the most  deleterious demographic tends in global history, as history’s largest, worldwide debt edifice parabolically rises.

Today’s article was inspired by the unprecedented PPT/Cartel “reactions” to what I view as the most concentrated doses of “PiMBEEB” – or Precious Metal (and Bitcoin) bullish, everything-else-bearish” headlines I have come across since the height of the 2008 financial crisis.  Only this time, the long-term prognosis is much worse, given the aforementioned, historic debt and overcapacity issues that have since been built into the system by unprecedentedly destructive Central bank actions.  Which, cumulatively, have taken us dramatically closer to the ultimate financial market collapse; certainly in real terms, if not nominal terms as well – that must inevitably arrive, given how historically far from reality government-rigged prices have become.

Yesterday alone, we saw British stocks – care of the PPT, of course – barely decline in the wake of not only the biggest home-soil terrorist attack since 2005, but increasingly contentious BrExit discussions.  Or how about Greek stocks barely declining Tuesday, after it was learned that Troika “bailout” discussions badly broke down, putting the dying nation within two months of default?  Or Spain’s stock market barely declining today – when, following a shocking Socialist Party election, setting the stage for a third national election in less than two years, Catalonia threatened immediate secession if the secession referendum it plans for this Fall (which likely, will pass irrespective) is not recognized as legitimate by the Spanish government.

Or South Africa’s market barely declining on rumors its President will be ousted?  Or last night’s Shanghai “dead ringer” and “hail mary” rallies – allowing it to “bounce” off the key level of 3,000 the PBOC’s “national team” riggers have been long defending – after China was unexpectedly downgraded by Moody’s to within two rungs of junk status, as its interbank lending rates exploded, its yield curve inverted, and fears of the collapse of history’s largest economic and financial bubbles proliferated?  This, after the “Dow Jones Propaganda Average” was similarly propped mere hours earlier, after new home sales “unexpectedly” plunged 8% in April, whilst the Richmond Fed Manufacturing Index free-fell from 15 to 1.  Which, I might add, would have fallen much more if not for the historic “prices paid” surge, signalling rampant stagflation.

I mean, geez, even Asher Edelman, the legendary investor whom Gordon Gekko himself was modeled after, espoused yesterday that “I don’t want to be in the market because I don’t know when the plug is going to get pulled…(as) the government’s ‘plunge protection team’ is the only thing propping up the current market rally.”  To that end, even Mario Draghi warned this morning of the, via a blatant Alan Greenspan reference, “excessive exuberance” in European home prices.

And don’t worry, none of this could possibly be bad for fiat currencies in the process of being serially hyperinflated, in a last ditch effort to avert their inevitable, spectacular collapse; as paper Precious Metals; and particularly, “paper PM investments” like mining shares; were kept under control, via relentless attacks at all “key attack times.” I mean, geez, we have now experienced “Sunday Night Sentiment” raids on 185 of the past 195 weekends – or 95% of the time over the past four years; and 844 of the past 963 “2:15 AM” opens of the London pre-market paper trading session – or 88%; as we did last night, with ZERO other markets materially moving.  And don’t forget the “oil PPT-supported” crude markets, at the key psychological level of $50/bbl they have been defending for the past 18 months, in the lead up to tomorrow’s guaranteed-to-fail OPEC meeting – with the world still amidst the greatest ever crude glut, with only the nearly full Chinese strageic oil reserve preventing it from getting much worse; potentially, very soon.

Last but not least, we have the accelerating implosion of the economy, geopolitical clout, and political stability of the dying “superpower” known as the United States.  Since Election Day, a “perfect storm” confluence of PiMBEEB factors has made it as vulnerable to economic and political collapse as at any time in its 240-year history, at a time when financial market valuations have been goosed to all-time high valuations; and conversely, increasingly scare Precious Metals to all-time low valuations.  In other words, these “last to go” markets – as I deemed the Dow, and paper Precious Metals two years ago – have never been closer to “going.”  And with them, whatever still remains of the rapidly dying, global fiat Ponzi scheme.  Which, now that gold and silver have the aforementioned, increasingly powerful ally known as crypto-currency at their side, are poised for an historic upward explosion, as “Economic Mother Nature” inevitably – and perhaps, imminently – claims victory against the historic market manipulation that is setting the (global) stage for an unprecedented catastastrophe.