Just two days from a “debt ceiling breach,” I recall one of the first pieces I wrote upon joining Miles Franklin two years ago. With the “Teflon Dow” now subject to the same government algorithms that have been suppressing PAPER PM prices – and thus, unable to experience significant declines or volatility; it occurred to me TPTB are attempting to create a “Philosopher’s Stone” for the financial markets.
The Philosopher’s Stone was said to have the ability to turn lead to gold; i.e., an allegory for bankers’ current attempts to turn PAPER PMs into PHYSICAL metal. And, for that matter, stock indices that historically represented economic expectations to “digital financial weapons” programmed to rise in value, no matter the circumstances. In other words, a form of modern “alchemy”- in which the Philosopher’s Stone is a combination of derivatives, government intervention, and illegal, but unregulated trading practices. Somehow, TPTB believes that, by influencing market prices, they can change the laws of “Economic Mother Nature.” Or, in the case of Precious Metals, delete a 5,000-year history of monetary superiority.
Of course, the one thing they can’t produce is PHYSICAL metal; and the more they suppress gold and silver prices, the tighter their supply will become. Moreover, the longer their “game” plays out, the more detrimental the impact on the billions of global victims of their crimes. The INFLATION generated by creating unlimited money inevitably causes war, poverty, and strife; in the process, sowing the seeds of such evil’s demise – per the great Richard Russell…
The only power evil has is the power to destroy itself. I affirm that the Federal Reserve note is doomed. When the Federal Reserve note goes down the drain, all fiat money in the world will go down with it. Today information travels around the world with the speed of NOW. People around the planet will see that fiat money is a fantasy and a counterfeit fraud foisted upon them by unconscionable and unscrupulous bankers. It is then that the crowd will turn to gold, in much the way that people turned to gold back in 1978 to 1980.
–Dow Theory Letters, January 2, 2013
Today is yet another instance of the same PPT and Cartel tricks being utilized to mask the horror that is the global economic and financial situation. Every trick in the book is being utilized to drive down PMs – and drive up stocks – despite the ONLY news being the countdown to U.S. debt breach; a MASSIVE miss in the Empire State Manufacturing Index; an utterly abysmal – and fraudulent – Citigroup earnings report; the worst “same-store” retail sales in the past four years; an ALL-TIME LOW Obama approval rating; and an ALL-TIME HIGH Indian PHYSICAL gold premium…
Amongst this “perfect storm” of Precious Metals fundamentals – which will only accelerate as the global economic crisis expands; I put together a comparison table of where the world stands compared to the last “debt ceiling crisis” in August 2011. Back then, if you recall, global markets plunged amidst collapsing economies; exploding debt; and in America’s case, an imminent debt-ceiling breach that ultimately yielded the first-ever stripping of its “triple-A” credit rating – for whatever that’s worth – by Standard & Poor’s. When you read the details below, consider just how criminal – and “influenced” – Standard & Poor’s must have been when four months ago, it upgraded the “outlook” for America’s credit rating from “negative” to “stable”…
Yes, in the two years since dollar-priced gold hit an all-time high, it’s quite clear the very issues that catalyzed that move are dramatically worse today. For the past six months, I have written of how U.S. government-led attempts to “mask” such misery have been focused principally on MONEY PRINTING, MARKET MANIPULATION, and PROPAGANDA – as given the accelerated pace of worldwide economic and financial deterioration, they have exhausted ALL other options. Consequently, when reading this chart, it should be “crystal clear” that the only things that have since “improved” are equity indices and – by a much larger amount – P/E ratios. In other words, they are desperately trying to inflate favorable assets and deflate unfavorable ones. The fact that retail participation in stocks has fallen to multi-decade lows is immaterial; so long as the MSM dutifully reports a rising Dow to signify the ambiguous, amorphous “recovery” that will somehow save the day.
By the way, one thing I couldn’t find an exact number for was the pernicious mining cost inflation that has decimated operations since the Fed and other Central banks turned up the PRINTING PRESSES following 2008’s Global Meltdown I. I’d guesstimate at least 20% cost inflation in the past two years alone; which is why – according to analyst Steve St. Angelo – the marginal cost of silver production has soared to roughly $26-$28/oz. And if you don’t trust an “outsider” like St. Angelo, than how about an insider like Gold Fields CEO Nick Holland – who claims gold miners require $1,500/oz. to cover their all-in costs!
No matter how you slice it, we are living in a world where a handful of bankers and politicians are DESTROYING the world in pursuit of the wealth and power that comes with maintaining the status quo. Unfortunately, REALITY is gathering momentum against them; as their fiat Ponzi scheme is clearly in its death throes. Only the when and how it collapses remain in question; and frankly, any of a dozen or more catalysts could emerge at any time. As for Precious Metals, NEVER in history have they been so historically cheap; as supply will continue to collapse whilst demand explodes. Given what you see ALL AROUND YOU – including worse U.S. credit risk than in 2011 – what are you waiting for to purchase them?