It’s Thursday morning, and this will be my last article before the long holiday weekend. That said, there’ll be plenty to “study” over the next four days, care of this link to the entire, nearly three-hour proceedings of last week’s Houston “Q&A Rap Session” with myself and Miles Franklin’s President and Co-Founder, Andy Schectman – hosted by one of the true “good, smart people” in this business, Daniel Ameduri of Future Money Trends. In it, essentially every topic you can imagine is covered – all of it, with no strings attached. As was the case at previous sessions in Denver, Minneapolis, Phoenix, and Ft. Lauderdale; and will be so at our Chicago session on June 24th (email me at firstname.lastname@example.org if you’d like to attend).
As for today’s situation, never before has such a perfect storm of “PM-bullish, everything-else-bearish” news flow prevailed – amidst, care of historic market manipulation, record-high financial “asset” valuations, and record low valuations of real money. I mean, how much more blatant can it be that since last year’s “Eastern Point of No Return,” the Chinese government has been utilizing the “hail mary” algorithm to protect its markets?
…although it hasn’t yet learned how to execute the “dead ringer” algo, which is probably why the Shanghai Exchange is closer to multi-year lows than highs…
As for the gold Cartel, basking in its short-term, unequivocally “Pyhrric” victory, only a dolt can’t see how it’s “set up shop” at $1,230/oz – having utilized seven “Cartel Herald” algorithms in the past 28 hours alone to cap gold there, amongst a veritable blizzard of gold-bullish headlines.
For the record, in 14 years of gold watching, I have never seen the Cartel Herald algo in any market other than PMs – where it occurs every time gold or silver attempt to rise. And man, it’s uncanny how the 12:00 PM EST “cap of last resort” is used to quash burgeoning PM rallies; although in the past year, it’s been closer to 11:30 AM EST, as we saw in silver on Tuesday and Wednesday…
But don’t listen to “conspiracy theorists” like the Miles Franklin Blog. I mean, Deutsche Bank’s admission that it, along with a cadre of other “bullion banks,” suppressed gold and silver prices for the past 15 years must be a figment of our imagination. Or yesterday’s announcement that Citigroup is paying a $425 million fine for manipulating interest rates. Or yesterday’s U.S. Appellate Court ruling that 16 of the world’s largest banks can be civilly sued – for potentially, hundreds of billions of dollars – for manipulating LIBOR.
Or heck, Alan Greenspan’s 1998 admission that…
“Central banks stand ready to lease gold in increasing quantities should the price rise.”
Or then Bank of England governor Eddie George’s 2000 admission that, following gold’s post Washington Agreement spike from $255/oz to $310/oz…
“We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K.”
Or then Bank of International Settlements’ Economic Chief William White’s 2005 admission, via a speech to “central bankers and academics” at the BIS’s fourth annual conference – in a speech titled, LOL, “The Past and Future of Central Bank Co-operation” – that the “intermediate objectives of central bank co-operation” include…
“…the provision of international credits and joint efforts to influence asset prices, especially gold and foreign exchange, in circumstances where this might be thought useful.”
…as exemplified by this headline on Europe’s largest news service on December 7th, 2011 – i.e., “Operation PM Annihilation II”; at the Cartel’s time-tested “key attack time #1” of 10:00 AM EST, when gold spiked just after an “unexpected” ECB rate cut (which, after the gold smashing damage was done, was mysteriously retracted, without being confirmed or denied)…
“MNI NEWS via BLOOMBERG – Market sources report Bank of International Settlements, Bank of England, and Federal Reserve were selling gold after it popped to session high at GMT 1335.”
And by “gold smashing damage,” I mean this – catalyzed by, what do you know, the “Cartel Herald” algo. As clearly, the Cartel was desperate to prevent another run at $2,000/oz – and thus, drew an “historic” line in the sand at the key round number of $1,750/oz. But hey, I must be making all this up, as there’s no way a paper trading monstrosity like this could have any manipulative effect on the “price discovery” mechanism.
But I digress, as the aftermath of last week’s “FOMC Minutes Attack” has my dander up. Clearly, the “powers that be” are closer than ever to losing control – and unquestionably, said “attack” will only make a world already buying Precious Metals at record levels that much more likely to add to their positions. And inevitably, end the “New York Gold Pool’s” tyrranical reign, like the “London Gold Pool” before it.
That said, it’s not just physical supply and demand that’s working against them, but the inexorable advancement of “Economic Mother Nature” and the “unstoppable tsunami of reality.” Today’s miserable Tiffany’s and Costco sales figures, for instance; or the CEO of McDonald’s stating that Obama’s insane, vote-pandering gambit to raise the minimum wage will cause “McAdee’s” to build job-destroying robots; or French labor unions shutting down 19 nuclear power plants, in search of more free money; or the currency of Nigeria – the most populous nation in Africa – on the verge of collapse; or the U.S. launching massive steel import tariffs against China; or this week’s near-recessionary PMI manufacturing and service indices; or massive demand for the Treasury’s 2- and 5-year Treasury auctions, despite the June “rate hike” the Fed is supposedly considering; or the utter explosion of health insurance costs, which will worsen dramatically due to America’s – and the entire Western world’s – hideous demographic tragedy unfolds.
However, what really garnered my attention in the past 24 hours was the seemingly endless sea of stories about corporations, municipalities, and sovereign nations desiring – or in desperate need of – bailouts. Yes, “bailouts” – which in layman’s terms, mean stealing from innocent bystanders, like us, to fund profligate or fraudulent enterprises or governments, via either taxation or the printing press. Or heck, our own bank deposits, now that most Western nations have adopted “bail-in” protocols (why anyone would keep significant funds in the insolvent, criminal, zero interest paying banking system is beyond me).
This week alone, the “U.S. territory” of Puerto Rico was quietly “bailed out” by Congress – further solidifying its $70 billion of unpayable debt as U.S. citizens’ ultimate obligation. And yet, Congress is simultaneously debating a bill to prevent actual U.S. States from being bailed out – many of which, like Illinois, California, and New Jersey, as well as many of the municipalities within them – desperately need them, or will so in the future. And don’t forget the Central States Pension Fund, which is on the verge of cutting benefits to hundreds of thousands of blue collar workers, due to the insolvency caused by eight years of zero interest rate policy. Which, I assure you, is just the “tip of the iceberg” for countless pension plans, insurance companies, and other organizations dependent on fixed income to survive.
Across the pond, Greece was supposedly “bailed out” again – to the chagrin of the majority of citizens, who a year ago voted against such “help”; not to mention, the IMF, which says it wants no part of it. Meanwhile, Swiss citizens will next week vote on the “Unconditional Basic Income” referendum; i.e., whether the government should “bail them out” from the monstrous inflation the “conservative” Swiss National Bank has wrought – by selling the nation’s gold, printing trillions of Francs, and pegging them to the dying Euro. And in Japan, alas, none other than Bill Gross opines that the Bank of Japan – i.e., a de facto government agency – should buy up whatever Japanese government bonds it doesn’t yet own, and “forgive” the governments obligations. In other words, allow it(self) to default. This, from the “Bond King” himself!
My friends, I hope that whilst enjoying the long holiday weekend – at least here in the States – you ponder just how close the world at large is to its inevitable “Jimmy Shaker Day.” That is, when decades of stupidity, arrogance, and profligacy come home to roost – with no ability to “bail itself out.” In much of the world, this has already occurred – but if you’re one of the lucky few, living in places where you can still proactively prepare for a bleak economic (and political) future, I sincerely hope you’ll use this once-in-a-lifetime opportunity to “bail yourself out,” whilst you still can.