Real money advocates have endured mental and financial torture since TPTB’s manipulations passed the “point of no return” three years ago. However, we have never been more correct in our forecasts or views. Indeed, the political, economic and social environment of the “good old days” of the 2011 debt crisis are barely recognizable; although listening to relentless “recovery” propaganda, you’d think America had recaptured its “golden ages” of yore. Ironically, not a single other major economy even purports to be expanding, let alone enjoying a material recovery. And thus, the dichotomy between the reality of the global economy and fraudulence of commandeered financial markets.
We’re told QE is “ending,” despite ZIRP continuing for a “considerable time” whilst interest payments continue to be “re-invested” in the Treasury and Mortgage-backed bond markets. Moreover, essentially all other major Central banks are dramatically overtly increasing QE, supported whole-heartedly by the Fed, the OECD and the IMF. Heck, we were just told the Iraqi War is over; yet 3Q GDP surged due to government defense spending – whilst our Nobel Peace Prize winning President, whom weeks ago promised no new “boots on the ground” ordered just that this weekend.
As for said recovery, “island of lies” economic data claims it is occurring, but reality speaks otherwise – in volumes. We’re told explosive growth is “just around the corner,” yet industrial commodity prices are crashing – like iron ore down 60% from its 2011 high. Conversely, corporate layoffs are surging as connoted by last week’s Challenger job cuts report; retail sales are sagging, per McDonalds celebrating 12 straight months of contracting revenues; and subsidized student and auto loans are exploding as people desperately seek “income” to pay their bills. Which, by the way, we’re told are “deflating,” whilst surging food prices – from beef, to chicken, shrimp, and milk, scream otherwise. Not to mention, healthcare, insurance, rent, electricity and nearly everything we “need versus want” to live. And care of “shrink-flation,” many such costs are hidden from view – like reduced food package sizes and increased bank and airline fees.
To wit, “median nightmare” described how the average American family faces an annual funding deficit; as validated by today’s news that the average “millennial” – i.e., the nation’s largest demographic – has an annual savings rate of negative 2%. This damning article says it all of what QE and irreversible secular decline has done to the Middle Class – who voted with their feet last week, in validating record low Congressional approval ratings by voting out as many incumbents as possible. And as for America at large, what part of record debt doesn’t scream depression?
We’re also told financial markets are not manipulated, whilst major banks are caught in the act; as UBS was this weekend in the “sacrosanct” gold market and seven others in the foreign exchange pits. Meanwhile, corporate investment is crashing; yet, care of ZIRP, the PPT and a scarce investment opportunities, an incredible 11% of U.S. market capitalization has been “bought back” in the past three years – at record valuations, no less. Volatility has been so destroyed by the “Greenspan/Bernanke/Yellen Put” – i.e., the PPT – that “portfolio insurance” has never been cheaper, despite said historically weak economic activity and unprecedented valuations. And yet, all one has to do to realize what’s really happening is to see what is “anticipated” – as cyclical stocks are plunging, whilst “defensive” stocks are soaring.
We’re also told precious metals are unloved, despite massive withdrawals from the GLD ETF, the COMEX futures market and the Shanghai exchange; let alone, as the U.S. Mint sells out of silver Eagles amidst an historic demand surge. Meanwhile, the head of the China Gold Association says, “Gold is money par excellence in all circumstances, to be used to support the renminbi becoming an international currency, as the very material basis for modern fiat currencies.” And no less than the paragon of money printing himself, “Maestro” Greenspan, candidly reveals “gold is by all evidence, a premier currency. No fiat currency, including the dollar, can match it.” And yet, we’re told to fear it will crash, despite trading well below its cost of production. The “consensus” expects the Fed Funds rate to end next year at 1.0% – and yet, as rates sit near record lows, we’re told to fear “higher rates.”
For that matter, we’ve for months been told that no more than two-fifths of Catalans favored secession, despite a series of 2013 polls suggesting 55% or more. We’re also told the loss of 25% of Spain’s tax revenues could never happen, as Catalan secession would never be allowed. And yet, 2.3 million Catalans voted yesterday, with a whopping 81% favoring secession. Such a “Catalan-astrophe” – as Zero Hedge deemed it – could dramatically alter the European political and economic order; as not only will a potential Catalan secession cast a black cloud over an already recession-racked Spain for the foreseeable future, but it may empower other “fringe” movements to decidedly strike against mainstream dogma. Venice, Italy immediately comes to mind; but more importantly, Switzerland, which just three weeks from now will hold its potentially historic gold referendum. By the way, the Swiss Franc hit a two-year high against the Euro this morning of 0.830; as clearly, speculation is rising that a “yes” vote will cause it to blow through the 0.833 ceiling infamously pegged on September 6th, 2011.
Speaking of market “expectations,” Friday’s eye-opening precious metals rally certainly got the attention of TPTB. Another punk NFP report confirmed expanding economic uncertainty; and when combined with fears of the potentially destabilizing effects of the aforementioned referendums – and countless other factors – it was imperative that every manner of manipulation was utilized to “stabilize” the situation. Amidst the chaos, the 10-year Treasury yield plunged back to 2.3%, whilst European stocks plunged. But lo and behold, perhaps the 10th straight “dead ringer” algorithm saved the “Dow Jones Propaganda Average,” replete with blatantly transparent “hail mary” rally to turn it positive in the day’s final minutes.
As for gold, it closed Friday’s “Access Market” at $1,179/oz., putting the fear of god into Cartel tape-painters that the two-year support level of $1,183/oz. might be recaptured; thus, causing black box momentum traders to start buying and MSM commentary to question if “the bottom” had passed. Thus, the 73rd “Sunday Night Sentiment” raid of the past 74 weeks; followed by the fifth 12:30 AM EST raid of the past six trading days; and attack after attack as this morning progressed, despite not a shred of news to explain it – other than the Cartel’s time-honored mantra that “all great PM days must be followed by horrible ones.” As for the Dow, yet another “dead ringer” algorithm, and accompanying “new Hail Mary” for the 10-year Treasury yield.
Remember, we only spend this much time discussing – and intimately describing – manipulation to let you know just how desperate TPTB have become, particularly as they face a potential “Waterloo event” on November 30th; but generally speaking, as the massive global Ponzi scheme they created starts to crumble.
To that end, today’s financial, geopolitical and economic trends are more bullish than at any time since the turn of the century; at a time when PM sentiment, valuations, and mining economics are at generational lows. Heck, even the “bad guys” are signaling as much, for what it’s worth – as the last two times COMEX gold and silver “commercials” had such small short positions were the bottoms in June 2013 and December 2013, respectively. Again, for what it’s worth.
And despite today’s somewhat disjointed discussion, don’t for a second ignore the potentially catastrophic ramifications if the Catalonian secession movement gains momentum – which surely it will following yesterday’s exclamation point of a vote. As the fiat Ponzi scheme moves through its terminal stage, the House of Cards is starting to splinter. And eventually – perhaps in dramatic fashion – it will come crashing down. At which point, if you haven’t already protected yourself, it will be too late.