Yes, it certainly feels like “they” are in total control – but this is not the first time, and likely won’t be the last. That said, I assure you “they” thought they’d win the Greek and Catalonian referendums, the BrExit vote, and the U.S. elections – not to mention yesterday’s German Presidency vote, in which Merkel’s arch rival won, paving the way for her likely defeat in next year’s Prime Ministerial election.
“They” also thought unprecedented money printing, market manipulation and propaganda would cause the global economy to improve – certainly after eight years; or heck, 16 years if you go back to the “peak” of history’s largest, most destructive fiat Ponzi scheme. And “they” certainly thought Central banks could eventually unwind their gargantuan balance sheets; and that crude oil and real estate prices could never fall; and that the “99%” wouldn’t fight back; and that they could maintain impoverished welfare states without any political or social blowback.
They’ve failed on all counts – as not only has the global economy collapsed to its weakest level in generations, but currencies are imploding at an unprecedented rate; said “99%” are fighting back at the polls; and all efforts to “reflate” have failed – with their only “achievements” being stagflation, skyrocketing debt, and burgeoning social and geopolitical unrest. Frankly, nothing says “powers that be failure” like Donald Trump’s presidency – as trust me, a loose cannon, self-financed outsider like Trump is the last person they want running the world’s only (for now) superpower. Not that Trump isn’t intimately tied to much of the Washington/Wall Street machine; at the least, to protect his vast business interests. However, there is simply no way to control what he might do, and control is what they desperately seek.
There’s no need to continue harping on the misery these monsters have caused us – in stealing away what should have been our victory, and replacing it with misery and frustration. Which continues to this minute, as time after time, gold and silvers’ every attempt at rising have been stifled by prototypical Cartel algorithms, whilst asset classes with no business rising have been boosted by various manipulative operations, in what I this weekend deemed an historic “manipulation/idiocy/hubris conflagration.”
We are already seeing a physical supply response – particularly overseas, due to the historic currency declines of the last week alone; and particularly in the world’s two largest PM buyers; India, following an historic, government-decreed “cash ban”; and China, which again devalued the Yuan last night to a new seven-year low. Not to mention, as most of the aforementioned “emerging market” currency declines – and heck, “developed world” as well, such as the Euro – commenced from levels already at, near, or in many cases well below previous all-time lows. Not to mention, as bond yields simultaneously experienced one of their sharpest ever spikes, on the heels of expectations of an historic Trumpian fiscal stimulus plan. Which, as discussed in my “Turning on Trump” post-election Audioblog, is for all intents impossible, given the only way to finance it would be with massive money printing and Fed monetization. Which in turn would stoke further rate surges, particularly given the mass exodus from U.S. Treasuries by foreign Central banks, who are collectively desperate for cash.
Which is why, in turn, the Fed is so backed into a corner regarding its December 14th meeting – as at this point, it knows it must raise a quarter point to “catch up” with the markets doing it for them this week. However, once the market realizes the economy is in fact going nowhere; and that the political process – such as, for instance, the U.S. debt ceiling debate just four months hence; it will rapidly “undo” its flawed inflation expectations. At which point, the Fed will realize it just contributed to pricking the bubble it created by raising rates, setting up the inevitable rate cut as soon as they lose control of the stock, currency, bond, and/or commodity markets, for even a moment.
Not to mention OPEC – which I see is back to its old tricks again; for the umpteenth time this year, circulating “production cut” rumors when oil prices fall to the low $40s. I mean, at this point, it’s getting as embarrassing as the Fed spending three-and-a-half years predicting “imminent” rate cuts, and more than that telling us they have an “exit” strategy for their gargantuan, high duration, $4.5 trillion portfolio of historically overvalued Treasury and mortgage bonds. Oh well, just two weeks from now, on November 30th, OPEC will have to face the music – and no, pretending they plan to cut production, as they failed to impress the markets with at Algiers, is not an option for the Arabian boy who cried wolf.
And did I mention the “Deutsche Bank of Italy” – Bank Monte dei Paschi – who “they” were so sure would get enough funding to avoid a bail-in? Which, as of yesterday, appears unlikely, setting up Italy’s third largest bank to steal depositors money, “perfectly timed” to coincide with the December 4th Constitutional Reform referendum. In other words, the now 60% money market “odds” of an ItalExit – which would be far more devastating to the European Union than the BrEXit – are likely to take a giant leap forward in the coming weeks. But don’t worry, “they” have everything under control – so long as “they” can continue to goose the “Dow Jones Propaganda Average” to still higher levels of overvaluation; and suppress Precious Metals, despite tightening supply, and surging global demand.
Of course, the ultimate lack of control is depicted by the demographics I have exhaustively discussed for years – as in 2012’s “demographic hell”; 2014’s “deadly dollar demographics”; and 2016’s “worldwide demographic vice tightens” and “imploding demographics, the ultimate Central bank killer.” In this regard, I have long agreed with Harry Dent, despite his views on money being, in my view, as detached from reality as can be imagined.
Yesterday I came across an article so thorough in its description of how doomed the global economy is by its inexorably weakening demographic trends, I felt it must be highlighted, to focus on the fact that, no matter how hard “they” try, “demographics insure they can’t win!”
Which is, this article from an unnamed author on the economical.blogspot website titled “Trump Economic Fabrication no Different than Obama or Bush Economic Deceptions.” In it, it not only shatters the concept of U.S. economic “growth,” but throws freezing cold water on any conceivable notion that the world has a chance at growing its way out of unprecedented debt and overcapacity, given how dramatically its demographics are set to implode, for decades to come. Typically, I would summarize all its key tenets – but in this case, I’d like you to read it for yourself; which I assure you, will have a more dramatic effect.
For anyone who believes “they” always win, or that “winning” in Precious Metals must occur in the very short-term, please consider that demographically (as well as economically, monetarily, and politically), they cannot win, no matter how hard they try. And thus, if you are considering PROTECTING your assets for the unquestionable outcome of hyperinflationary money printing and debt monetization, this week’s post-election slam down, to historically undervalued levels relative to both monetary inflation and physical fundamentals, it would seem now is as good of a time to do so as any.