Yesterday’s “why Bitcoin will make gold and silver go up” was a big hit – as it should be, given how momentous the rise of crypto-currency is; and consequently, how governments are guaranteed to respond. I mean, if they’re this scared of something as intrinsically worthless as cash; let alone, non-interest bearing “barbaric relics” like gold and silver – which to date, they think they have mastered the art of suppressing in the futures markets; just think how terrified they will be of, as the wisest of all Bitcoin prognosticators, Andreas Antonopoulous, deems, the “internet of money” – particularly in light of the fact that for all intents and purposes, it can’t be naked shorted.
The offshore Yuan fell to a new all-time low of 6.97/dollar last night – a level not seen since before there was a tradable offshore Yuan, before the 2008 financial crisis. Which I assure you, is not being lost on Bitcoin, Precious Metals, and all other investors the world round. In fact, a particularly astute reader sent me the following message last night, describing the inexorable monetary end game scenario that must eventually arrive – as history’s largest, most destructive fiat Ponzi scheme implodes.
Hi Andy. I enjoyed your latest piece on Bitcoin and gold. Evidently, Bitcoin has replaced many of the large money brokers in China, as trust in the block chain trumps brokers and the banking cabal. For what it’s worth, I think the marriage of crypto-currency and gold/silver could create entirely new ways of feeding the underground economy, to the point that many centrally-planned silos just collapse. Many of these emerging fintech platforms create new plumbing that ultimately leads to the demise of our leveraged banking system. I believe such technology will continue to rapidly evolve, placing regulators in the rear view mirror
I was sobered up last night by the comments of two of the biggest Bitcoin “thought leaders” – aside from Antonopoulous, a true visionary and hero of mine. The first of whom, is universally lauded for his Bitcoin “calls” – yet wrote last night of how it is superior to gold for the broadly propagandized – or in many cases, just plain ignorant – reasons the Paul Krugmans, Harry Dents, and Goldman Sachs’ of the world have been espousing for years.
Let alone, this comment from a self-proclaimed Bitcoin genius and generally speaking, financial “know it all”; who, like the aforementioned trio, and essentially all others in the “evil Troika” of Washington, Wall Street, and the Mainstream Media – choose to put their heads in the sand in the pursuit of self-serving agenda.
“Andy Hoffman thinks EVERY market is manipulated – and if that is the case, why is he in the business of advising people what to do with their money (he probably thinks gold has been manipulated for 35 years)…. the conspiracies are out of control sometimes from people that need to sell their services.”
Is he not aware of the news? Like, for instance, the damning precious metal manipulation proof Deutsche Bank submitted to the courts this month – such as this, and this? Or this blatant admission from 16 years ago from then Bank of England Governor, Eddie George?
“We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The US Fed was very active in getting the gold price down. So was the U.K.”
Or the countless admissions of rigging markets as diverse as mortgage bonds, LIBOR, interest rates, and foreign exchange, to name but a few? Not to mention, what part of the definition of zero interest rates, negative interest rate, and quantitative easing – i.e., printing money to monetize financial assets (including, in the case of the Swiss and Japanese, equities) – do such “non-believers” in manipulation not understand?
Yes, EVERY market is manipulated, whether you choose to believe it or not. And no, it’s not “conspiracy,” but fact. Let alone in Precious Metals, the historic arch-enemy of fiat currency, due to the fact that it’s honest; has genuine, relentlessly rising intrinsic value; and has served a monetary role for not just decades – like the U.S. dollar; but millennia. In fact, it’s funny that he mockingly says I “probably think gold has been manipulated for 35 years” – given that the London Gold Pool was an official Central bank suppression tool (led by the Federal Reserve, of course); which commenced in 1961, but failed in 1968 when “Economic Mother Nature” proved too powerful for its stated goal of holding gold below $35/oz. As opposed to the covertly operated “New York Gold Pool” today; which frankly, isn’t so covert at all, if one simply reads the mission statement of the official U.S. government entity known as the “Exchange Stabilization Fund.” Let alone, the “President’s Working Group on Financial Markets.” And the list goes on and on, whether one speaks of overt or covert manipulations. To that end, I challenge anyone in the financial world – a la Bill Murphy vs. (ex-Goldman Sachs-ite) Jeff Christian, in October 2011 – to debate me regarding how “free” markets are – any day, any time!
And as for his contention that I need to “sell my services,” I was writing such things as far back as 2003 on the GATA website – eight years before joining Miles Franklin. Like, for instance, the prototypical “Cartel Herald” algorithm that has stopped every Precious Metal rally for the 15 years I have been watching; let alone, at the “2:15 AM” EST open of the London paper pre-market trading session; as we saw yesterday for the 758th time in the past 873 trading days; and today, amidst fiat currencies crashing the world round, the 759th time in the past 874 trading days. I mean, what are the “odds” that gold would fall at the London open on roughly 90% of all trading days for (at least) the past three years? Let alone in 2016, a year in which gold prices will end the year higher than in 2015? Perhaps I’ll have to send him the definition of “sixth sigma” – i.e., a statistically impossible outcome in actual, freely-traded markets.
The aforementioned “rant” is the perfect segue into today’s topic; i.e, the third “Demystifying Precious Metal Propaganda” installment of the past two weeks – the first, here; and the second, here. In which, I will discuss in “hindsight,” some of the factors put forth in the past two months as “reasons” why gold and silver prices have declined. And by “hindsight,” I mean that it’s always the same group of anti-gold bashers – whether in the aforementioned “evil Troika”; or worse yet, within our own ranks – fear-mongering those who simply want to PROTECT themselves from Central bank inflation with lies, propaganda, and “mis-truths.”
In the case of the gold “import quota restrictions” that may or may not have occurred in China – which physical market insider, and free market truth-teller Andrew Maguire expressed strong disbelief about two weeks ago – I don’t believe for a second that this actually occurred. I mean, aside from Russia, there is no more pro-gold government than China’s; and since they continue to overtly acquire tonnage; whilst the Shanghai Exchange continues to see record physical withdrawals – at record premiums; it makes ZERO sense that the PBOC would do anything to slow gold imports into the country. Let alone, as the onshore Yuan is being officially devalued, whilst the offshore Yuan weakens further. To that end, if anyone actually believes such nonsense, please read the content of this November 29th speech from Teng Wei, Deputy General Manager of the Shanghai International Gold Exchange – titled “how China’s gold market can help the Renminbi achieve international status.”
Next, there’s India, where Narendra Modi – has essentially taken the world’s second most populous nation back to the Dark Ages, in establishing a “cash ban” that achieves NOTHING other than a consolidation of his personal power; at the expense of a billion-and-a-half person economy; the rapidly collapsing Rupee; the nation’s hard-fought “second world” status; and any hope that India will ever be relevant.
Yes, there have been official decrees about how much jewelry married woman can hold, as a scare tactic in the early stages of this draconian political power grab; which sadly, will likely become more the rule than the exception in 2017. But how much of this “decree” will in reality translate to action, as opposed to fear-mongering propaganda?
What are the odds that hundreds of millions of Indians, watching their economy crash, their Rupees devalued, and their dignity stolen by a megalomaniac, will sit idly and allow the government to take their (likely well-hidden) gold? And what are the odds that the already well-established Indian black markets will not grow more powerful – particularly in light of the fact that pre-cash ban bank notes now trade at a premium to their previous values? Which, I might add, Andrew Maguire, in that very same interview, suggests is already occurring, in spades. In other words, as Jeff Goldblum’s Dr. Malcolm espouses in Jurassic Park, “life finds a way” – which is exactly what is likely to occur in India monetarily, as terrified citizens do “whatever it takes” to PROTECT their net worth’s with history’s only time-tested means of long-term wealth storage.
If this December 22nd article is true, Modi may in fact be already considering such factors, in his unrelenting goal of maintaining power for as long as possible, at any cost. In which, it suggests that when India’s 2017-18 fiscal budget is announced in February, it may actually include a reduction in the onerous gold and silver import tariffs enacted in 2013 to “reduce the current account deficit,” from 10% to 6%. Which, given how Modi’s insane cash ban has essentially closed off India from the rest of the world, makes complete sense – in that it would, like China, promote the importation of real wealth into the nation, using the fake wealth that are dying Rupee notes as the means – for any idiot willing to take them. In other words, keep your eyes peeled regarding what occurs in India in the coming months – as not only does the “cash ban” – contrary to what Modi had hoped and expected – catalyze political, economic, social, and monetary chaos; but the national interest in buying Precious Metals, particularly at today’s historically suppressed prices, to become manic; certainly “unofficially”; and perhaps, officially as well.
Last but not least, in what can only be considered by any “thinking” person to be a last ditch effort to fool the last idiot out there, the “overplaying of the manipulative hand” by the powers that be regarding Precious Metals fear-mongering – which I’d expect no less from, from the soon-to-be-dead European Union. To that end, even I laughed when I saw this lunacy yesterday, as posted on Zero Hedge; in which, it suggests that in an attempt to crack down on “terrorist financing”; using last week’s German mall bombing as cover to introduce such draconian legislation; the EU wants the ability to have free domain to check, investigate, monitor, and indiscriminately, arbitrarily confiscate any perceived means of such “terrorist financing” – be it cash, Precious Metals, pre-paid debit cards, Bitcoin, or whatever other asset they want to get their hands on. Which, aside from being essentially unenforceable in a civilized society like Europe; by an increasingly irrelevant, soon-to-be-dissolved political body; demonstrates just how terrified the powers that be of are the dire political, economic, and monetary ramifications of the collapse of their Central bank destroyed fiat currencies. Like say, the EURO – which as I write, is on the cusp of setting a new 14-year low, en route to monetary oblivion.
To say “draconian government action” will be a key theme of 2017 is an understatement, no doubt. However, the level of anti-gold propaganda is reaching a level of sheer lunacy – to the point that it may well be “peaking” as we speak. As, as noted above, financial “life” will not be denied, in the form of hundreds of millions – if not billions – of global denizens finding ways to protect themselves from the hyperinflationary money printing that must inevitably destroy the hundreds of ill-begotten, ill-fated fiat currencies created by history’s largest, most destructive fiat Ponzi scheme in 1971 – in many cases, in 2017; i.e., the “year of money printing.” Thus, for those that believe gold and silver – at historically suppressed prices, to the point that the mining industry is amidst permanent decline – will not find ways to be acquired; or for that matter, Bitcoin, cash, pre-paid debit cards, or any means of protecting wealth; is naïve at best, particularly in light of today’s proliferation of advanced financial technology.