We have several things to speak of today, starting with indisputable proof that what we wrote in yesterday’s “Ultimate Gold Manipulation Primer” is spot on. To wit, we cannot emphasize enough that “sixth sigma” events like identical trading patterns cannot occur in freely-traded markets. Yesterday, for example, we showed how not only were three of the past five days’ trading patterns identical, but matched the dominant algorithm of the past 20 years. And today, on a day when gold is up sharply as I write at 10:15 AM EST, we still started with the exact same suppression pattern.
Next up, one of the most important topics imaginable. That is the upcoming, permanent isolation of the “island of lies” that is U.S. economic reporting. Specifically, the NFP employment report that has served as a primary political tool for as long as we can remember – but particularly, since the U.S. economy permanently broke in 2008. No blog has spent more time dissecting the fraudulent methodologies behind the “all-important” NFP report – or, for that matter, highlighted the plainly stated ugly truths behind its internals. However, by far the most heinous mistruths pertain to the BLS’ “birth-death” model fabricated in 2003 when the post-tech wreck economic landscape revealed a permanent structural loss of high-paying manufacturing jobs. In other word, the government simply made up phantom jobs to make up for the real ones lost. And don’t for a second believe it a coincidence that this change was made just before the 2004 Presidential re-election campaign.
Since 2008, the situation became far direr; as not only secular employment reductions due to offshoring were working against America, but the expanding collapse of the global financial system. For six years, TPTB’s only weapon has been money printing, market manipulation and propaganda; but ominously, none are working as they used to. Regarding the latter, NFP data is rapidly becoming the joke of the worldwide investment community – as highlighted by the declining “unemployment rate” whilst Labor Participation and real median income hit 35 and 40-year lows, respectively.
However, the most blatant soon-to-be universally understood fraud is the “birth-death” model, which we have discussed ad nauseum, including yesterday. To that end, this article is a must read for economic truth seekers; essentially, disproving the Obama administration’s lie that all the post-2008 job losses have been recouped. The birth-death model in itself is but a flawed theoretical model, but when incorporating the fact that businesses have not only been dying more rapidly than new ones are emerging, but corporate “barriers to entry” have reached historical highs, it becomes patently obvious that the four million birth-death jobs supposedly created since the 2008 financial crisis may well be, in reality, closer to four million job losses.
And now for the main event, as TPTB desperately try to “stabilize” financial markets amidst the acceleration of the global economic collapse that commenced six years ago. Frankly, this is a perfect example of humanity’s flawed cognitive process, ignoring the “pink elephant” in the room in lieu of a more palatable explanation; i.e., one offering even the slightest shred of hope. And that, of course, is propaganda blaming the plunge in Western equity and high-yield markets on “Ukrainian fears” just as “the weather” was used to explain the worst holiday spending season since 2009.
Sure, “Ukrainian tensions” were fueled by yesterday’s speculation that the Russians are “preparing for invasion.” However, such rumors are not much different than ones we’ve heard for months; and with each passing day, it seems less and less likely that “the Russians” are the aggressors. To that end, we have for some time written that the ambiguous term “de-escalation”– like “recovery” and “tapering” before it – was being utilized as a propaganda buzzword to calm equity markets and attack precious metals. However, not a shred of evidence supported de-escalation; and thus, five months after we penned “This Is Why We Do What We Do,” it appears our initial assumptions regarding the Ukraine were dead on. Last month’s MH-17 attack dramatically deepened the crisis, and as of today, the odds of catastrophic military confrontation have never been higher.
However, to blame Western “risk asset” declines on the Ukrainian crisis is highly suspect in our view. Said “pink elephant” is decidedly not geopolitical tension in the Ukraine, Iraq or the Gaza Strip; but instead, the fact that expanding economic collapse threatens to swamp TPTB’s best efforts to whitewash it. I mean, geez, how much more obvious can it get than the world’s “leading” governments approving bail-in legislation and the Federal Reserve mandating “too big to fail” banks to create “living wills” in case they can’t survive the next crisis?
Yesterday’s horrific Chinese economic data, following Japan’s the day before, confirm the Eastern hemisphere is unquestionably in freefall. And today, news that Italy “unexpectedly” plunged into triple-dip recession, whilst German factory orders plummeted 4.3% confirms Draghi will indeed attempt “whatever it takes” to save the Euro in the coming months – starting with the $1 trillion “QE” program the ECB claims to be “preparing.” And by the way, in recent months Italian “diffusion indices” have been rapidly expanding, proving how worthless they are as predictive measures.
Here in the States, mortgage purchase applications fell another 1% to a new 20-year low; and now that financial markets are retreating, it couldn’t be clearer that the Fed-fueled housing “echo-bubble” – on which the entire propagandized “recovery” was predicated – is dead and buried. Today’s trade data revealed non-energy trade to be at nearly its lowest level ever, and reading of how California farmers are incurring 1,000% water price increases – amidst the worst drought in generations – the odds that the “noise” Whirlybird Janet deems inflation to be, is about to get a lot noisier; particularly in the mining sector, where production costs are skyrocketing. And oh yeah, in “emerging markets” where more than half the world’s population resides, where currencies are plunging anew.
However, as the all-important 10-year yield plunges to nearly a “post-taper” low of 2.44% this morning – en route to ZERO, unless hyperinflation arrives first – the biggest pink elephant of all is conveniently ignored by said human psyche, particularly the “manipulation centers” of Wall Street, Washington and the MSM. Which, of course, is the fact that Fed money printing has created history’s largest financial bubble – in essentially all “risk assets,” but particularly equities. No chart in my lifetime is more ominous than the one below, depicting how stocks have never been more overbought, even during the 2000 internet bubble which – by the way – occurred during the strongest economic environment in generations.
TPTB will continue to purport any and all economic and or market weakness to be directly related to “exogenous events” that could at any time reverse – such as “the weather” or “Ukrainian crisis.” However, the facts claim otherwise, as global economic activity is unquestionably at its post-2008 low, whilst “exogenous events” have never been more plentiful or threatening.
It’s only a matter of time before complete control of such “crisis management” is lost; and when it is, if you haven’t already protected yourself with precious metals and other items of real value, it will be too late. And if you do decide to act, we humbly ask you to call Miles Franklin at 800-822-8080, and give us a chance to earn your business.