For the literary junkies amongst us, Yorick is the dead court jester in Hamlet. When shown his decaying skull, Hamlet laments Yorick’s passing; who to him, was a friend – but to the majority, naught but the court jester. Perhaps when Janet Yellen has long left Washington, having resided over history’s most destructive currency crisis, we’ll learn what she was like “behind closed doors.” However, to billions of despondent, angry people, she, too, will be naught but the court jester.
Which brings me to next week’s semi-annual “Humphrey-Hawkins” Congressional testimony, when “Yellenomics” are officially introduced. Following publication of her prepared remarks Tuesday morning, Janet would typically be subjected to a litany of softball questions from clueless, bought-and-paid-for Senators and Congressman; just as Bennie and the Maestro before her. Of course, if the current market collapse hasn’t been stabilized by then, the atmosphere could be quite a bit more strained. After all, Yellen was appointed to preserve a status quo in which Wall Street campaign contributions have become indispensable; and thus, any threat to such a cozy, corrupt arrangement are not to be tolerated.
In recent years, this largely meaningless testimony has created significant “volatility” in the Precious Metal markets – as have all Federal Reserve statements, for that matter. Of course, I say “volatility” in quotes because there is nothing inherently shocking about a Fed that continues to print money, ad infinitum, to support the fiat Ponzi scheme it created; as well as the banks that own it.
Suffice to say, the Cartel has become terrified of the reputation the Fed Chairman has built since the 2008 financial crisis – such as this January 2012 article deeming Ben Bernanke a “goldbug’s best friend.” And thus, everything from FOMC meetings; to the “minutes” of such meetings; to unofficial comments from regional Fed Presidents; have in recent years been accompanied by blatant PAPER PM raids. I long ago deemed Fed appearances and statements “key attack events”; and no time was that more obvious than Bennie’s February 29th, 2012 Congressional testimony, on what is now remembered as the “Leap Day Violation.”
On that day, gold was taken down $90/oz. after Bennie said nothing incremental; which shouldn’t surprise anyone, given the Fed has never used such a forum to alter monetary policy. Or, for that matter, even hint at such changes. However, as gold had recovered nearly two-thirds of its post September 2011, Cartel-administered losses by February 2012 – with the potential of hitting a new all-time high shortly thereafter – the Cartel clearly orchestrated one of the most blatant paper attacks imaginable, just as Bennie’s prepared remarks were released. From $1,790/oz. just minutes before he appeared, gold was taken down to $1,550/oz. in July 2012, until it again achieved (EXACTLY) $1,790 in October 2012. In other words, all the Cartel accomplished with the “Leap Day Violation” was an eight-month can kick; which, of course, necessitated a heightened suppression scheme.
However, TPTB badly miscalculated just how powerful Precious Metals demand was. And thus, once their blatant pre-election market and employment data manipulations re-installed Obama in November 2012; followed by the commencement of “QE3” in December 2012, and aversion of the “fiscal cliff” in January 2013, Bennie’s “Humphrey-Hawkins” testimony on February 26th, 2013 vaulted gold and silver back to $1,620/oz. and $29.50/oz., respectively – quite clearly, with enough momentum to push them to new highs later in the year. In fact, his testimony could not have been more dovish – which is what catalyzed the Cartel’s subsequent desperate – and ultimately, suicidal – actions.
In taking gold and silver down by $250/oz. and $5.50/oz., respectively, for no apparent reason on April 12th and 15th – in what I’ve since deemed the “Alternative Currencies Destruction,” as it coincided with a vicious Bitcoin collapse – the “beginning of the end” of the Cartel’s PM suppression scheme commenced.
Sure, Wall Street enjoyed a banner year, whilst Main Street continued to melt down; as PAPER PM prices were taken to today’s unfathomable levels, well below their respective costs of production. However, global physical demand exploded to all-time high levels, causing inventories to be drained to all-time lows; as described in yesterday’s “Physical Demand Explosion to Start 2014,” and epitomized by this chart of the COMEX’s registered gold balance. FYI, note the vertical black line, depicting the inventory collapse commencing exactly in the second week of April.
And now, just one day into her monetary dictatorship, Queen Janet of Wall Street is faced with the likely “financial reckoning day,” following four decades of unbacked money printing; ironically, 100 years after the Fed came into being, following a secretive, sparsely attended, Christmas-week Congressional vote.
Global currency and equity markets are plunging with a viciousness not seen since 2008; and ominously, many currencies have already breached ALL-TIME lows – including, among others, the Indonesian Rupiah, Turkish Lira, South African Rand, Russian Ruble, Argentine Peso and Brazilian Real. Regarding the latter, by the way, I received the following email from a reader last night; which should serve as a blaring warning to everyone reading this article, no matter where you live…
Andy, it’s getting harder and harder to buy physical down here in Brazil.
…much less in India, where maniacal, soon-to-be-repealed import restrictions pushed physical gold prices, for those that could find it, to 25%+ premiums to the so-called “spot price” traded on the New York COMEX.
The end game of currency collapse was baked into the cake in August 1971, when the gold standard was abandoned. However, the specific, tragic path it is following is due principally to accelerated printing of the world’s leading currencies, led by the dollar – as a response to the 2008 financial crisis. The Fed’s “QE,” the ECB’s “LTRO,” Japan’s “Abenomics,” the SNB’s pegging of the Swiss Franc to the Euro, and other maniacal Western central bank schemes have exported rampant inflation to billions of the world’s denizens; thus, awakening the financial cancer from dormancy, and inciting its final, catastrophic, virally-spread destructive phase.
And thus, what options do the Cartel still have, in their quest to suppress Precious Metals and interest rates; whilst supporting equity prices and fostering belief in the mythical unicorn of “recovery?” And what could they possibly have Queen Janet say on Tuesday morning, knowing full well that “tapering talk” is what catalyzed the current market convulsions; not to mention, that U.S. economic data – like this morning’s plunging U.S. factory orders data – has utterly collapsed in recent weeks? I’ll give you a hint; absolutely NOTHING – which is why Janet’s February 11th Congressional testimony – following what could be an equally “dovish” ECB statement on February 6th – may well prove the denouement of history’s most intensive, destructive economic propaganda scheme!