I wasn’t planning to write yesterday morning, before traveling to Phoenix for last nights – as it turns out, wildly successful – “Q&A Rap Session.” To that end, we will be announcing new meetings in Houston and Chicago later this week, atop the Ft Lauderdale session already booked for April 21st.
However, the onslaught of bearish PM “newsletter writer” articles in the past week – of how the Fed meeting would validate the “commercials’” extreme short position in gold and silver futures, I felt compelled to awaken at 3:00 a.m., on four hours of sleep, to write “the COT’s don’t matter, Part II.” Which, after the Fed figuratively “wet itself” with its pathetically childish – and decidedly credibility-destroying – policy statement, was validated in spades.
Consequently, as I write early Thursday morning at 4:30 AM PST – again, after four hours of sleep – gold, silver, and platinum have essentially recouped all of their post-ECB, Cartel-orchestrated losses; setting PMs up for a significant breakout in the coming weeks – potentially, catalyzed by silver’s imminent “confirmation” of gold’s “golden cross” last month (50 DMA crossing above its 200 DMA) as early as next week. And when it does, it won’t be due to falsified “rumors” of “production cuts” – as the “oil PPT” is attempting in the hopelessly oversupplied crude market; because, LOL, 15 years of Cartel price suppression has imposed “natural production cuts” on the PM mining industry, yielding peak gold and silver. This, amidst the highest physical demand of all time – as the hyperbolic (read, hyper-inflationary) terminal stage of history’s largest, most destructive fiat Ponzi scheme commences.
Equally vociferously, I have maintained that Central bank credibility is DEAD, DEAD, DEAD; and thus, whether Janet Yellen opted to talk “hawkishly” – by mistakenly believing the PPT’s historic equity and commodity short squeeze suggested economic “recovery” (ironically, the same day economic bellwether Caterpillar massively slashed guidance); or “dovishly,” by taking future rate hikes off the table, it may well backfire on her best laid manipulative plans. In other words, “policy error II” – which it decidedly turned out to be, in catalyzing a massive dollar plunge; plummeting Japanese and European stock prices (ominously, led by DEUTSCHEBANK); and oh yeah, surging Precious Metal prices. And by the way, guess which “brilliant” investment bank joined its miserable “top trades of 2016” call from January (5 of 6 of which have already been stopped out); with its “short gold at $1,200” call of February (about to be stopped out); with its “FOMC statement will cause a dollar surge” call of yesterday (which has likely been stopped out already)? Yep, Goldman Sachs – which I assure you, directly or indirectly, is one of the “commercials” that took the massive COMEX gold and silver short positions that are being annihilated as we speak; and at some point, must be “covered,” as logic dictates.
To wit, Whirlybird Janet’s “unexpected” dovishness launched the “final currency war” I first warned of three years ago into “hyperspace”; which will undoubtedly be elevated exponentially when the BOJ meets next – as last night, whilst the Yen surged despite Kuroda espousing his intention to take rates as low as -0.5%, Japan reported its biggest plunge in exports to the U.S. in five years. (UPDATE – as I edit, the BOJ just intervened in the currency markets, to smash the Yen back down!).
Not to mention, the ECB – which one week ago, made the most hyper-inflationary announcement in Central bank history; only to watch the Euro surge due to 1) markets laughing in Draghi’s face; and 2) Whirlybird Janet one-upping him yesterday. In fact, the Euro has surged to multi-month highs since last week, whilst European stocks have declined (again, led by DEUTSCHEBANK). And what’s this I see? The top headline on Zero Hedge this morning is that Norway, too, cut rates this morning – in the process, threatening to take them negative as well. Gee, I wonder when we finally get the long-awaited, Cartel-catalyzed “short squeeze” in Precious Metals that finally launches the dollar-priced gold bull market into the stratosphere, as has already occurred in essentially all other currencies.
To that end, gold is, on average, roughly 10% from its all-time high nearly everywhere on the planet – and in many cases, well above previous highs. Thus, given that prices in the world’s most heavily overprinted, heavily overvalued currency are still 35% below their 2011 highs – and in silver’s case, 70% below; as supply contracts, inventories vanish, demand explodes; and oh yeah, said “commercials” are mega-short, whist the Fed goes full-blown dovish; how long can it possibly be before dollar-priced gold, too, dramatically surges? And with it, silver; platinum; and the odds of critical industry-wide metal shortages?
As for what the Fed actually said, even I was taken aback at its extreme dovishness – calling to mind San Francisco Fed President John Williams’ smug prediction of “four rate hikes in 2016” just three months ago. Which has already been refuted; and more likely, will be closer to ZERO than four. To wit, the Fed’s “dot plot” – which financial markets have been increasingly ignoring, in the ultimate repudiation of the age-old mantra to “don’t fight the Fed” – now assumes just two rates hikes in 2016; which in my view, will not only not occur, but ultimately be replaced by rate cuts into negative territory – particularly during an election year, as Janet Yellen’s only chance of re-appointment lies with a Hillary Clinton victory.
As for its pathetic “word cloud,” fabricated in a room full of more than 100 taxpayer-funded lackeys, the key changes could not have been more dovish – specifically, the insertion of “business fixed investment has been soft” and “global economic and financial developments continue to pose risks.” Which, I might add, despite the mild tenor of the changes, are cataclysmic in terms of their repudiation of the Fed’s unrelenting “recovery” propaganda.
As for what happens next – TRUST ME, the Cartel will continue its “fight to the monetary death” are long as it can – such as today’s pathetic attempt to forestall the inevitable with its typical COMEX-opening cap and attack.
However, now that Janet Yellen herself has “launched the final currency war into hyperspace,” they will – and MUST – be defeated; potentially this year, as they have in essentially all the world’s currencies. And surely, dramatic news like this morning’s – that the world’s second largest reinsurance company, Munich Re, have responded to NIRP by buying huge amounts of gold, won’t help the Cartel’s case any. In other words, the institutional demand surge I spoke of last month, when no one else was, is accelerating; likely, providing the spark that, once and for all, destroys the 21st Century gold Cartel. Ushering in, I might add, what will likely be a very scary world – in which those that haven’t PROTECTED themselves beforehand, will “financially perish.”