It’s early Tuesday morning, and I’m sitting in one of the most peaceful places imaginable the Denver airport at 5:00 AM, where I’m the only sole in sight. This evening, Miles Franklin is hosting a “Protect Your Wealth” dinner in Minneapolis, Minnesota where Andy Schectman and I will be speaking and I’m looking forward to saying hi to our team and speaking to a large group of truth-seeking investors.
Fortunately it’s a quiet morning newswise. However, the Japanese and European stock markets appear to be following the U.S.’s lead – falling significantly as the potential for a new, global financial contagion takes hold. Ironically, Zero Hedge is off in stating that unlike 2008, global Central banks are not in “easing mode”; as trust me, if the current stock declines cannot be stopped – by the usual money printing, market manipulation and propaganda – we’ll be back in “2008 mode” in a heartbeat. Frankly, it’s flat out comical to characterize the current environment as anything but accomodative; as as I write, the Fed is QE’ing $55 billion a month – and likely, much more, with the promise of maintaining ZIRP for at least another 12-18 months. The ECB just reduced rates to 0.25% and last week unveiled the blueprint of a $1.4 trillion QE program, the BOE has given no time frame for ending its five-year QE and ZIRP programs, the BOJ is halfway into the two-year “Abenomics” scheme, targeting a doubling of the Japanese money supply and the PBOC not only just executed a de facto Yuan devaulation, but printed nearly three times as much money in January as the Fed and BOJ combined! In other words, if this is a period of Central bank “tightness,” I’m terrified to see what “loose” policy will look like which sadly, is exactly what we will see in the coming months.
Amidst today’s litany of global “horrible headlines,” the theme – or meme, in current parlance – that stuck out most prominently was LIES; i.e., propaganda, permeating every aspect of the political and media landscape. The commandeering of entire governments by Wall Street has created a perpetual economic “lie machine,” charged with doing “whatever it takes” to preserve the status quo; and seemingly, no matter what topic is discussed, mainstream publications spin it as positive. War, famine, recession, inflation – you name it, and somehow it is portrayed as “good” for the economy, “good” for the future and, of course, “bad” for Precious Metals.
What got me started on this tangent were two articles last night by the great Paul Craig Roberts, a former Assistant Treasury Secretary who has taken Washington “whistleblowing” to a new extreme. In first writing of the outright fraud of Friday’s (still miserable) NFP report, and next the Obama Administrations obvious attempts to demonize – and incite – Russia over the Ukrainian crisis, he penned the following, overarching comment that must be kept in mind when reading anything emanating from the “evil troika” of Washington, Wall Street, and the MSM.
As I write, I cannot think of one thing in the entire areas of foreign and domestic policy that the US government has told the truth about in the 21st century. Just as Saddam Hussein had no weapons of mass destruction, Iran has no nukes, Assad did not use chemical weapons, and Putin did not invade and annex Crimea, the jobs numbers are fraudulent, the unemployment rate is deceptive, inflation measures are understated, and the GDP growth rate is overstated. Americans live in a matrix of total lies.
–PaulCraigRoberts.org, April 5, 2014
To wit, the so-called recovery discussed above – as “validated” by supposedly “strong” jobs growth – can be refuted with just a modicum of due diligence; in this case, demonstrating how the true U.S. labor situation is the worst since the Great Depression. And not only that, but sadly, such figures grossly understate true unemployment.
Or how about the equally hyped “housing recovery” which amidst the tiniest increase in interest rates, has clearly started to roll over. Essentially, the entire 2012-13 “boom” was the product of Wall Street speculation with free Fed money; and now that vulture buyers, like private equity “buy to rent” speculators, have stopped buying – amidst the most unaffordable housing market of our lifetimes – there’s only one direction for real values to go, and possibly nominal prices as well. The fact that mortgage originations have fallen to an all-time low amidst record stock and bond prices should tell you all you need to know; and moreover, scream loud and clear what the Fed will need to do when it becomes apparent that only exponential increases in money printing can prevent a near-term real estate implosion.
Globally speaking, government lies have become as epidemic as the worst Ebola outbreaks as the worse economies get – and consequently, the more difficult for incumbents to be re-elected, the more egregious the propaganda, mistruths, and inuendo. Recently, the trend toward “re-calculating” historic GDP data has become in vogue for governments trying to mask their debt; frankly, in a manner not much differently than Goldman Sachs telling Greece that if it restructures its debt “off balance sheet,” the resulting decline in published “debt/GDP” would reduce its borrowing costs. The U.S. and China have implemented similar accounting schemes in the past year but none so blatant as what Nigeria did yesterday – in essentially “doubling the size of its economy with the stroke of a pen,” per Simon Black of the Sovereign Man. Truly Orwellian stuff, depicting a global shift toward the justification of draconian government policies with flat out lies; sadly, an unmistakable element of human history, that always repeats itself when times become most desperate.
When it comes to wealth protection, hands down, one’s greatest fear should be inflation. The fact that said governments are steadily increasing the “deflation” drumbeat – amidst quite obviously, the highest cost of living environment in generations – should tell you all you need to know of what’s coming. As we’ve noted ad nauseum, fiat currency regimes, by nature, are Ponzi schemes that must grow larger to survive; and thus, with the entire world enmeshed in the largest such scheme ever, future Central bank actions are already set in stone.
However, no “official” actions in the realm of deception are more blatant than the past decade’s attempts to suppress the prices of history’s most reliable “inflation barometers,” silver and gold, but particularly the past two-plus years. Outside GATA, no one has discussed this topic more than the Miles Franklin Blog and since HFT trading is in the news, we thought it was worthwhile to bring this amazing article to your attention, from the great J.S. Kim. In it, he gives a fantastic account of how HFT trading is utilized to attack PAPER gold and silver prices; which despite its foolproof logic, the CFTC – of course – ignores, given that they, as a government entity, are charged with furthering such fraud. As we wrote in last week’s “Is the Market Rigged?” the real issue is not the “skimming” HFT algorithms steal from the public with, but the fact that they have become powerful policy tools to rig essentially all paper markets – from stocks, to bonds, commodities, and currencies.
Sorry if I seem a bit disjointed, but it’s very early and I’m very tired. Honestly, I cannot recall a day in the past year that I didn’t write something, as I am as committed to protecting readers at this critical juncture in political and economic history as anything I have ever done. Hopefully one day, my writing will be remembered as having “made a mark” on the world and if even one half of one percent of “financial stragglers” take it to heart, I will have considered my life’s work a job well done.
As for the “markets,” its quite the coincidence that the Dow’s declines were limited to exactly the “ultimate PPT limit down” level of 1.0% the past two days, whilst the NASDAQ was savagely bludgeoned. Meanwhile, the Cartel’s obsession with capping Paper PMs at the current “lines in the sand” at the very key round numbers of $1,300/oz. and $20/oz., respectively, could not be more blatant.
However, following last week’s “golden cross” in the gold market – i.e., its 50 DMA crossing above its 200 DMA for the first time in a year, with silver’s own “golden cross” coming shortly – the Cartel’s ability, in an environment of soaring physical demand, to hold these lines is getting exceedingly difficult – as you can see by this morning’s action.
And when we say soaring physical demand, our claims are backed up by data from the four corners of the globe. Per the below quote from James Turk, gold backwardization – which frankly, can only happen when physical demand surges due to artificially low paper prices – has reached levels only seen just before the PM bull market commenced at the turn of the century, and the very bottom in 2008, when government attempts to “prove” PMs weren’t safe havens caused the most severe physical shortages of our lifetimes.
So here are the key numbers that we need to look at Eric: The low price in gold was reached at the end of June. Since the backwardtion began on July 8th, there have been 192 trading days, and gold has been backwardated a remarkable 55% of the time. This compares to the low in the gold price in 1999 and 2008, when gold was backwardated only 2 and 3 days respectively. This comparison shows how unbelievably distorted the gold price has become. Silver has also been backwardated along with gold.
–King World News, April 7, 2014
Hopefully, this article helped you to understand just how deceitful the world has become; and thus, the necessity of doing your own due diligence when deciding how to protect your assets. In our view, the Miles Franklin Blog should be a “go to” source of real, truthful information and if you agree, we hope you will “give us a chance” to earn your business by calling 800-822-8080!