I rarely do this, but I’ve started writing with 90 minutes left in Friday’s historic trading day – sitting in my hotel room in Chicago, preparing for what will likely be the best business meeting of my 27-year career. Yes, as luck would have it, I four months ago scheduled Miles Franklin’s Chicago Q&A Rap Session – featuring myself and President and Co-Founder Andy Schectman – for tonight, with not a clue what a momentous day it would be. To that end, for those that would like to see what such meetings are about, here is a link to the 3½ hour session we did in Houston last month, hosted by Daniel Ameduri of Future Money Trends.
I’m still working on 2½ hours of sleep, having awoken at 1:00 AM to write today’s MUST READ first reaction to the Britain’s political shot heard round the world, “historic Brexit vote marks commencement of the end game of global currency collapse; the demise of the European Union; and imminently, the gold Cartel itself.” But during this whirlwind day, sleep deprived as it has been, I’ve thought more clearly than ever before – about what just occurred, and what comes next.
Not that anyone can know how events will ultimately play out, of course. However, I’ll put my predictive track record of economic and monetary events against anyone on the planet, going all the way back to calling – and more importantly, acting to protect myself against – the dotcom bubble 16 years ago. And after nearly three decades, I’ve NEVER been clearer of where we’re headed.
To start, let’s talk politics – starting with the no-brainer to end all no-brainers. Which is, that the European Union – and with it, the Euro currency – is a goner. This Frankenstein’s brainchild was “put to death” by yesterday’s Brexit vote, after having terrorized Europe for five decades – putting the continent on the verge of all-out economic collapse, social revolution, and regime change. As for the Euro, it’s barely 15 years old – and already, on its deathbed. Frankly, I don’t think the timing of its demise is too far ahead; as after Brexit, the simmering nationalist tensions across countless other Eurozone nations, which I have warned of ad nauseum for months, will unquestionably explode. Starting with Spain this weekend, when it’s second Parliamentary election in nine months may well produce a resounding victory for the anti-Euro Podemos Party. This, as the Catalonian secession movement – which promised to secede by year-end, barely more than a year ago – gets ready to slice 25% out of Spain’s collapsing GDP. This is probably why the Spanish stock market plunged today by…drum roll please…an astonishing 12.4%!
Of course, it wasn’t just Spain’s market that collapsed, as the two top (remaining) Eurozone nations, Germany and France, saw their markets plunge by 7% and 8%, respectively. Heck, if the PPT ever lost control of the Dow by that much in a day, the Fed would launch QE4 the next day; which they may well do anyway, particularly if the storm clouds get particularly ominous in the coming weeks – or days, if this weekend’s Spanish election goes as I think it might. Or perhaps, if people the world round simply get terrified enough to “dump it all,” particularly at all-time high stock valuations, amidst the worst economic environment of our lifetimes.
Which, I might add, is about to stair-step dramatically lower in the wake of Brexit, as already dead and buried global trade grounds to a halt. To that end, European trade will be in a “deer in headlights” state for months to come; whilst Japan falls off the face of the Earth; and China, facing the imminent bursting of history’s largest economic bubble, prepares for a far more dramatic Yuan devaluation than that of last August. Which, to give you context of how I think it will impact global economies and financial markets, I at the time deemed the “upcoming, cataclysmic, financial big bang to end all bangs.” In other words, I believe this inevitable – perhaps after yesterday’s events, imminent event – will actually be more damaging to global political, economic, and social stability than even the Brexit. And oh yeah, just today the Yuan was “fixed” at its lowest level in more than five years.
Of course, all such issues will be back-seated if – or more appropriately, when – the guaranteed “Lehman of Europe,” Deutsche Bank – holding a derivatives book far larger than Lehman or AIG could have ever dreamt of – violently implodes, in what will undoubtedly be the most destructive, and far-reaching, corporate bankruptcy of all time. Then again, it may be “beaten to the punch” by any number of others – as European bank stocks, care of two years of negative interest rates and the implosion of the European economy, have been in freefall all year – before the Brexit was even considered a possibility. In fact, today was the worst day for European bank stocks EVER; down 13+%, including 15%-20% for dozens of well-known names, such as Deutsche Bank, Barclays, Lloyd’s, ING, Banco Santander, and France’s “Big Three.” In other words, the entire European banking system is about to collapse – and wouldn’t it be ironic if it’s next month’s Greek “bailout” requirement that puts it over the edge. Yes, Greece – with its $700 billion of EU and Wall Street force-fed debt – needs yet another bailout. Of course, this time around the people will not let last year’s “OXI” vote be ignored – particularly in light of the empowerment the Brexit result will foster. And oh yeah, it’s unlikely the “Troika” will even exist to administer it!
To that end, I strongly believe that in Europe, the coming months – and likely, years – will be characterized by exploding anti-Euro sentiment, which will tear the continent apart; catalyze “nuclear” currency wars, tariffs, and other protectionist tactics; and ultimately, regime changes, the breakup of the European Union, and the collapse of the Euro currency.
Spain may well start the ball rolling this weekend; but I assure you, Italy, France, the Netherlands, Denmark, and others will be right behind it. Of course, it’s not just anti-Europe sentiment, but anti-establishment sentiment in general that will encircle the world. Donald Trump’s now guaranteed election is the perfect example of such change; and whilst I’m terrified as to what he might do, particularly as the U.S. economy is collapsing, I would literally vote for anyone other than Hillary Clinton.
Such violent attitudes are now commonplace the world round, thanks to the economic horrors – and unprecedented wealth disparity – caused by history’s largest; most destructive; and for the first time, global; fiat Ponzi scheme. And they won’t improve for generations to come – until after it has collapsed, with the only assets standing being guaranteed wealth protectors like gold and silver.
As for financial markets, I believe the horrifying, generational bear market in commodities that started two years ago – which Janet Yellen still deems “transitory” – is about to take a dramatic leg downward, taking prices far lower than we saw at this winter’s lows. That said, most nation’s won’t, LOL, “benefit” from the lower prices; as their currencies – in most cases, already at all-time lows – are about to take their final, horrifying plunges toward hyperinflation. In other words, what just happened in Venezuela is about to happen in dozens of other nations; until eventually, larger, “leading” currencies like the Yen and Euro are enveloped as well. Then again, there might not even be a Euro, but that’s another story.
Regarding bonds, I asked this week when the biggest bubble of all – trillions’ worth of Central-bank-monetized sovereign bonds – will itself burst. Certainly the timing of the Eurozone collapse – or perhaps, the inevitable Grexit – will play a part in this equation. However, make no mistake; that like stocks, sovereign bonds will be destroyed in real terms – either via “deflation” or hyperinflation – far sooner than most can imagine. Again, leaving only real money – i.e, gold, silver, and Bitcoin – standing.
As for the “canaries in the coal mine” that Precious Metals have been since the gold standard was unilaterally, unlawfully abandoned in 1971, I have ZERO doubt that their monetary powers will be unleashed in unprecedented fashion, likely in the coming months. Everything I have seen, and learned, these past 14 years tells me the Cartel – which has promulgated history’s largest, most destructive fiat Ponzi Scheme – tells me they are about to be blown out of the water by the exploding, record-high demand; collapsing production; and vanishing above-ground, available-for-sale inventories that their two decades of price-suppressing operations created.
As always, I believe it will start in the ultra-tight, soon-to-be-universally-recognized-as-money silver market; which is exactly why, a mere two weeks ago, I wrote the “upcoming, historic silver shortage.” That said, just as in 2008, gold will also be nearly impossible to source; and at some point soon, first we’ll see the COMEX dead and buried – as trade shifts, like Bitcoin, to China. And finally, the end of all “futures” and other “paper” trading, as PM’s revert back to cash-and-carry markets, when investors lose faith entirely that said “paper gold” and “paper silver” is actually backed by physical metal.
Well, the day – and week – just ended ominously, with the Dow, commodities, and currencies at their lows; and PMs at their highs – notwithstanding last night’s initial, Cartel-quelled spike – despite unrelenting, soon-to-be-called out Cartel shorting. And WOW, WOW, WOW, I just took a look at the COT report, which was just released 30 minutes before the NYSE close. Yes, the Cartel actually added another 14,060 contracts to its already record-high gold short position; and 8,192 in silver, to within a hair’s breadth of its own record-high naked short position. And this, before today’s likely all-time daily shorting activity – which will only increase Monday, before being “outed” in next week’s report. In other words, the convictions behind last week’s “finally, the long-awaited Commercial Signal Failure is Nigh” article have increased a thousand-fold!
My friends, we are about to witness things – political, economic, and social – that have never been experienced in such a populated world. Alan Greenspan himself said, today, that “this is the worst period I recall…there’s nothing like it, including the 1987 crash.” And yet, even he vastly understates the hard times I envision – and my predictive track record is a lot better than his. Buckle up, and for god sake, PROTECT YOURSELF, and do it NOW!