It’s Monday evening, following yet another day of across-the-board “horrible headlines”; no matter what nation, continent, or hemisphere one considers. That said, today’s “top story” is that Greece – what a shock – didn’t complete its “reforms list” today as planned; putting it off until tomorrow – and thus, leaving the world a measly four days from “Grexit,” without even a firm proposal on the table. Heck, early this morning, well before this ominous news emerged, the Euro was already tanking – per what I stated in yesterday’s Audioblog; i.e, “even if a ‘deal’ is agreed upon, I’d bet the Euro continues to weaken irrespective; as clearly, the end game is upon Greece – whether PPT-supported markets give it four more months, or otherwise.”
Yes, the end game indeed – for Greece, the other PIIGS, and every fiat cancer ridden, debt-wracked nation on Earth; which is to say – for all intents and purposes – all of them. So is the nature of fiat currency Ponzi schemes; and now that every currency on the planet is engulfed by the current version, they all will eventually be destroyed – be it now, or later on. Many already have, as the average currency is down roughly 40% against the dollar since the Federal Reserve led history’s most destructive inflation exportation scheme in late 2011, as ALL major Central banks commenced QE, ZIRP – and in some cases, NIRP – “to infinity” campaigns. And those that haven’t been knocked into second – and in many cases, third-world hell, they inevitably will; some, in very short order.
To wit, the dollar surged yet again today, against nearly every currency – including commodity currencies that have already been obliterated since oil prices started plunging last Fall; and of course, the Euro itself. To that end, the blatantly obvious algorithms charged with “saving” oil prices are – as I predicted they would – failing; as WTI crude is on the verge of crashing below the newly created “oil PPT‘s” latest “line in the sand,” at $49/bbl. To that end, even a fraudulent “rumor” of an emergency OPEC meeting – which was refuted an hour later – failed to save oil today; and furthermore, today’s ugly economic data won’t make it any easier for said manipulators. To wit, existing home sales were reported to have plunged 5% last month, whilst the Dallas Fed Manufacturing Survey collapsed from -4.4 to -11.2. Subsequently, commodity prices have resumed January’s historic plunge; leaving the Baltic Dry Index at an all-time (30 year) low, and enabling the Israeli Central bank to be the 20th to cut rates since year-end. Recall, I wrote four-and-a-half months ago that “2008 is back“; and that, before said commodity cataclysm. Let alone, the Swiss Franc debacle; ECB QE; the Greek and Ukrainian crises; or the majority of the oil and commodity price plunge. In other words, the global economy is imploding; and likely, will do so at an accelerated pace in the coming months.
Which is why it will be so “entertaining” watching Whirlybird Janet squirm on Capitol Hill tomorrow morning, less than a week after the fraudulent “minutes” of the January 27th FOMC meeting depicted a terrified, clueless Fed – with not a clue what’s going on, or the slightest inclination to enact the mythical “rate hikes” they have intimated of since a “closed door” meeting between Obama and the “TBTF” bank CEOs in April 2013. Subsequently, history’s largest money printing, market manipulation, and propaganda scheme has created the largest-ever gap between asset valuations and economic activity; the largest-ever wealth disparity between the “1%” and the “99%”; and asset bubbles that put 1929, 2000, and 2008 to shame. Meanwhile, the most maniacal price suppression scheme ever continues unabated – as exemplified by today’s prototypical “2:15 AM” and 10:00 AM EST raids; amidst some of the most PM-bullish news imaginable. Which, by the way, included an abysmal production outlook, and huge reserve write-down from the world’s third largest gold miner, Anglogold.
Conversely, equally prototypical “dead ringer” and “hail mary” algorithms enabled the “Dow Jones Propaganda Average” to achieve yet another all-time high; whilst yet again, commodities, currencies, bond yields, and economic data plunged. I mean, Euripides, Sophocles, and Homer combined couldn’t conjure stories of such blatant, suicidal hubris if they tried. That is, unless they were writing of their home-town Greek bonds; which, in what could be the worst “risk/reward” trade of all time, actually rose today!
Nearly across-the-board, across the globe, government-supported financial markets meet that very same description; as care of history’s largest Ponzi scheme, worldwide debt loads are so far past the point of no return, it’s no longer in the rear-view mirror.
To that end, this horrifying chart; depicting how since said Ponzi smashed into the wall of “diminishing returns” at the turn of the century, global debt has increased by an incredible $112 trillion – including $57 trillion since the global monetary system broke in 2008. Consequently, 23 nations – including sovereign, municipal, and corporate obligations – have cumulative debt/GDP ratios above 200%, and nine above 300%. Needless to say, especially amidst the weakest global economy of our lifetimes, nearly all this debt is “unpayable.” Heck, even the top financial propagandists know it – per the below CNBC story, featured as Yahoo! Finance’s “top story this morning.”
Clearly, Greece’s case is one of the most extreme; as not only is it hopelessly bankrupt, but insolvent as well – with literally a few days of cash left; and thus, an Earth-shattering debt default dead ahead, for both the national government and dead and buried banks; the latter of which, categorize a whopping one-third of their outstanding loans as non-performing. This is why it’s utterly absurd that Greece and the “Troika” leaders are still pretending there is a “deal” to get done, other than extending the aforementioned hundreds of billions of Euros of “loans” with no strings attached. Doing so, of course, would be a “technical default”; and from a face-saving standpoint, there is essentially no chance the Euro Group would approve such a deal.
Greece, of course, would take such a deal indefinitely; but as it won’t be offered, Alexis Tsipras will be forced to either default – which he was essentially elected to do – or cave in to the same financial repression that destroyed Greece in the first place. Not to mention, against the violent opposition of the majority of Greek citizens. Moreover, not just Tsipras, but the entire Syriza-dominated Greek Parliament must approve of said “deal” before it is ratified; and given comments from senior Syriza leaders this weekend, it’s difficult to believe Greece will allow itself to remain a Euro Group “debt colony” much longer. Furthermore, rumor has it that many of the “reforms” to be proposed tomorrow will be non-starters for the Euro Group; possibly, a calculated strategy to make it appear the Euro Group was at fault for the inevitable “Grexit.”
That said, while Greece is the by far the “weakest link” in the entire, cancerous global monetary system, essentially all other nations face the same dire situation. One by one, they will be “picked off” like Greece, until eventually the reserve currency issuer itself is destroyed; and with it, the entire, global fiat Ponzi scheme. In Europe, said inevitability is far more imminent; as no matter what nation one considers, the same Syriza-like populist forces are gaining strength – for the exact same reasons. And if Greece does in fact Grexit, it is nearly guaranteed that similar movements will explode in Spain, France, Italy, and other hopelessly indebted nations.
And the ugliest part of all is that, like the misleading at best, fraudulent at worst “reserves and resources” held by mining companies, nearly all nations’ “debt to GDP” ratios are grossly understated, care of a plethora of accounting gimmicks designed to overstate GDP and understate debt. No one “does it better” than the U.S.; which not only holds vast amounts of “off balance sheet” debt, but relentlessly “adjusts” GDP upward by including large swaths of “economic activity” that don’t actually produce anything; like, for instance, the “goodwill” overpaid paid for corporate M&A transactions. Let alone, the explicitly illegal activities now included in numerous GDP calculations – particularly in Europe – such as drug dealing and prostitution.
Anyhow, the “moral of the story” is that while Greece will be one of the first so-called “first world” nations to go, everyone is essentially in the same boat; all the way up to the “reserve currency” issuer itself. To that end, it’s quite possible this week’s “Greek Tragedy” ends so badly, it not only triggers the inevitable Greek default, but those of countless other corporations, municipalities, and sovereign nations the world round. And if it doesn’t, and somehow financial markets don’t discount such a “tragedy” just yet, it’s just a matter of time before they do; likely, sooner rather than later.
And when this occurs – be it this week, next month, or a year or two later; if you haven’t already protected your assets with real money, it will already be too late.
Bravo, as uproarious pandemonium breaks out from the blogisphere cheering andy on. go andy go, go andy go! 🙂
“2008 is back“ so also says Mr Cahn at the silverdoc hospitality room, confirming the biblical 7 year cycle of doom for modern immorality, greed, and criminality.
I wonder if so, is such, at lemetropole, with ZH posting info on a federal probe into gold market rigging by the gold cartel? GATA should be all over it. Metals flat this day, even with such ZH leaks, must be the FED HEAD FELON performance, or option expire, the cartel having still its paper trump cards on the crimex.
Andy, do we get fire works in a few days?
We’ll get them, it’s just a matter of when and how.
That which cannot be supported, won’t be.
Just a question of time.
Historically proven, when all else fails? Take the nation to war.
All these little ‘bush’ wars are slowly converging into one BIG war. Just as a bunch of little bush fires eventually coalesce, into one big fire that involves the entire forest.
Again from history, ALL major wars start with an economic foundation. In the present case it’s a currency war. Soon to turn VERY hot.
Smoke and mirrors? Wasn’t there a multi-year investigation of something that ended a few years ago, where the CFTC just said, we found nothing….?
The game will never be ended by the Cartel’s own hands. But sure as night follows day, it WILL end.
Mmmm no mention of gold anymore I wonder why that is? For a very long period we have been hearing the same old story…. Its of course a nightmare for you and your company as its your living to sell gold to the general public SO… will you show this email this time??
Not sure I understand your message.
Don’t see any riots in Athens that Michael Pento predicted.
Everybody is Comfortably Numb playing on their video-games. Everything has now been “fixed”, till the next “un-fix”.
Not sure why he made such a bold prediction. But don’t worry, the riots are coming.
Dear Mr. Hoffman,
QE is not about what it does or doesn’t do….NOTHING AT ALL. QE is totally about the illegal theft of US sovereignty and capitalism… and the Federal Reserve is the criminal ..!!! Let me explain.
We have all been watching QE (quantitative Easing). The name itself “Quantitative Easing” sounds very complex and the people doing this must be really intelligent, so let’s not question QE, but rather, the results. Everyone goes round and round on QE. Is it going to help this or that? When will QE begin/stop? How much QE is next? What effect will QE have on this/that? All I do is throw my hands in the air and ask ..”Is there no one out there who understands what the hell is going on”???
The Federal Reserve, and the private individuals who own it, are taking control of our country (and other countries), by buying our national debt ….for FREE!! All they do is add zero’s to their balance sheet and purchase US debt. The Federal Reserve, (and other central banks), are taking control of our Stock Market (and other world stock markets) by buying US stocks…..for FREE!! All they do is add zero’s to their balance sheet and purchase US stocks. Stock buying is done in the name of “safety and security” by the plunge protection team…what an absolute joke!!
Over the last few years, approximately 4 trillion dollars (that they admit to) has been created out of thin airby the Fed and spent on the US bond and stock market. Roughly, two trillion on Government Bonds, and another 2 Trillion buying stocks through the plunge protection team (PPT). Soon, the Fed is going to be the largest holder of US debt. Does this mean that they can now take assets (national parks, government land, resources, etc) if they ever demand payment because they have financed the US debt with their magical money (at no cost to them) and want to be paid?
Soon the Fed is going to be (if not already), the majority holder of all major US corporations. Does this mean they now can dictate all aspects of major U.S. corporations?.. set pricing, decides who can buy or own US stocks, what items are sold where, etc. again, they have financed these stock purchases with their magical money (at no cost to them) by simply adding zero’s an account.
We have no idea of the real amount of the US stock market which is owned by the Fed through imaginary money creation, because they have NEVER been audited. So in essence, the elites who run the Fed are taking or stealing control of all U.S. corporations..at no cost to them, because they are “protecting” we investors from a stock market crash. This is totally corrupt, immoral and insane!! Who’s allowing this to happen?.. Where are our elected officials?
This leads to my next question. Why would the stock market ever go down? ..and if it did drop, all that would happen is the Fed would buy more, till finally they, (the elites) would own such a high percent of the stock market, that the market will never be over run by sellers. The only reason they will crash a market is to force the little guy to once again, panic and sell. I wonder how many small investors have sold over the past 8 years, as anyone can see the fundamentals do not support such lofty levels in the stock market?
But my biggest question of the Fed is… If they ever were to “reduce” their balance sheet, (we have all heard that this is in the plans), where does the money go? If the Fed reduces it’s bond position by selling all 2 trillion dollars of bonds (don’t believe it will happen, but if it did), who gets the money? Were talking trillions of dollars here. Who gets these funds???? Does the Fed say “well, since we created these funds out of thin air, we will simply erase them? Won’t happen…because once the fed creates the money…it is now “the Feds” money. The Fed (a private unknown entity), just pockets 2 trillion dollars!!..and that’s just from the bond side market.
This whole concept is almost beyond comprehension. What if you and I were the Fed. Wouldn’t it be nice to add unlimited dollars to our bank account balance with a few strokes of zero’s from the keyboard and say we are buying trillions of dollars worth of stocks and bonds in the name of “safety and security” for the U.S.? Then, you and I get to keep those trillions of dollars worth of stocks and bonds we purchased with our magical zero’s and put them in our personal account? Plus, we have no oversight or audits, thus, no one really knows what amount of stocks or bonds we have actually purchased. If we purchased two, three or ten times as much…who would ever know, because we are never audited? Again, this whole concept is almost beyond comprehension.
Now you see why the stock market will never go down and stay down…because the elites who own and control the Fed, will own (or already do own) such a high percentage of the market, that, if it ever does drop, it is for the sole purpose of forcing the little guy to panic sell their last remaining shares. This will result in the Fed buying a higher percentage of the market, and in a short time…..new highs. High stock prices also serve as a deterrent to the average investor….because he/she will not buy stocks at such exaggerated levels. The average investor will only sell….increasing the percentage owned by the Fed.
Soon, the Fed (a non federal, private organization), will own the U.S. stock market,(thus our corporations)..for FREE. They will also own the US debt (thus the U.S.)..for FREE. This is by far, the greatest theft in American history…and it’s occurring right now, in full public view, and no one is doing a dam thing about it!!!!
Your well written essay above can be distilled down to 2 words:
Soviet Politburo controlled all public lands/industrial output in Soviet Union. Same with Nazi Party in Germany, Chinese Politburo in China, Fascist Party in Italy etc.
This template has now been replicated in US. And most of Western world (European Union, Japan, Canada etc).
Thank you for explaining what is going on in terms that even I, a complete financial dummy, can understand. It is astounding.
The can may have been kicked one more time but it has not gone far down the road.
DOJ story moving forward on Gold is just one more possible time changing event.
Coming at us from every direction.
And another of the Swiss regulators investigating gold manipulation. Nope, nothing to see here…yet.
Soon the manipulators will be overwhelmed.
I smell an out of court (no admission of fault) make this go away scenario here.
Is not a naked short futures (by a non producer), a variety of fraud and deceit, selling something you do not have nor will actually produce in the future?
Yep, and even “hedging” future production isn’t far from that description.
In the short term I could care less what they do to manipulate the price of PMs.
In fact in the last 2 weeks I have only looked at the price once…. today.
As Andy and Bill and many others have stated…it will continue until it cannot any more.
Here is a piece a few months old but it is a good piece from a man that I have the greatest respect for…Eric Sprott
Call it Easy Listening Music for a goldbug.lol
Ultimately gold is likely to become the simplest answer to the lack of confidence in fiat currencies.
There is too much debt. There is too much fiat currency in the world.
As the confidence in these currencies falls we will reach a tipping point.
That tipping point will be the time when a gold standard returns.
Gold is rare and much too inexpensive.
To have a gold value at these levels only ensures that the amount of gold mined and produced will continue to fall. So silver is in the same delima.
We all know that there is way to much debt and unbacked fiat created each year.
Gold prices must rise or the amount of debt in the world must seriously contract.
So in reality where the problem is seen by governments that print fiat also sits the answer to the problem.
For that reason I believe it prudent to bet on the eventual significant rise in gold prices.
That is why I believe Jim Sinclairs $50,000 per oz valuation has merit.
When this transition of a return to a gold standard returns is unsure but it does appear based on recent developments that that moment in time is quickly approaching.
Who will move first. The East or the West.
First one out of the gate likely wins the race to sound money.