This Spring, as the global economy weakened to its worst state since the 2008 crisis, Cartel efforts to discredit gold and silver accelerated to levels even I had not seen; and I’ve watched tick for tick for nearly 12 years. As you know, the year’s first PM “selling climax” occurred in late June, when Bennie made the worst mistake of his career. Not that rates wouldn’t ultimately surge anyway, but in his fear of leaving a legacy of lowering rates to zero and keeping them there indefinitely, he catastrophically suggested the Fed might taper QE if the economy improved.
Since then, the global economy is indisputably worse; with the only real “bright spot” being the all-out Central bank liquidity blitz that has produced surging stock markets – and equally incredibly, narrowing European sovereign bond spreads. And oh yeah, cooked NFP reports – whistleblowers et al – only showing “improved employment” due to a plunge in the Labor Participation Rate to a 35-year low and increased minimum wage jobs.
Worse yet, the housing sector has indisputably rolled over – en route to plunging off a cliff. Everything from home sales to residential permits to construction spending is falling; and following a brief (Fed generated, let’s not kid ourselves) interest rate dip after the September and October “no taper” announcements, rates are again rising sharply. According to the BLS itself, housing represents nearly half the U.S. economy – not to mention, a significant percentage of the nation’s net worth; and it has nowhere to go but down.
This morning, with the benchmark 10-year Treasury yield again surging above the Fed’s current “Maginot Line” at 2.8%, it was just reported that mortgage and refinancing-related loan activity plummeted by simply astounding numbers; considering they were already at multi-year lows.
We’re just two weeks from the Fed’s last meeting of the year; and no doubt, TPTB want to publish another “better than expected” NFP report on Friday. If they do – “birth/death” jobs, “seasonal adjustments,” and Labor Participation Rate declines and all – they may well destroy America’s economy with one fell swoop. A rise above 3.0% on the ten-year will likely have catastrophic economic impacts the world round; which shows you how dire the global economic situation is, given 3.0% is still near the record lows achieved by the Fed’s “QE4” program earlier this year.
Not that Bennie’s going to do anything but maintain the status quo; as both he and Janet Yellen last month promised “no taper” indefinitely. Nor will the Fed ever do anything, lest the aforementioned bond crash would commence on their watch. But either way, I feel compelled to dare them to speak of tapering. And FYI, Precious Metal sentiment just fell to multi-year lows, with both gold and silver trading well below their respective costs of production. Gee, I wonder how this will end up.