It’s Monday morning, and man do I have a lot to talk about! Frankly, Merriam and Webster need to create new adjectives to describe the idiocy governments, Central banks, and corporations alike are exhibiting – as at this point, moronic, suicidal, tragic, and catastrophic are starting to be overused. Not that their moronic, suicidal, tragic, catastrophic actions are any different than those of the governments, Central banks, and corporations of yore. However, never have such entities been exposed to such destructive “weapons of mass destruction” – financial and otherwise; and thus, never before have so many people been put in harm’s way. And never, of course, has a fiat Ponzi scheme been utilized not just locally, but globally.
To start, let’s discuss the Greek “bailout” that never was. Which, as I predicted when propagandists decided Greece was “saved” this summer, is “coming apart at the seams.” That, and the rest of the PIFIGS (PIIGS plus France) – from Portugal’s historic political coup; to France’s exploding “war on terrorism” – amidst its highest-ever joblessness; the imminent secession of Catalonia, Spain’s wealthiest province; and Italy’s exploding debt burden, to name a few. In Greece, where its “leaders” blatantly disregarded the people’s “OXI” vote to austerity five months ago, in lieu of handing what’s left of the dying nation to predatory lenders, the only “bailouts” have been payoffs of principal and interest payments to the “Troika”; with not a penny going to destitute Greek citizens or corporations. Or, for that matter, its banks. Which, in this weekend’s “hijacking” by Western vulture investors, were essentially “sold” for a song. To that end, what I have long deemed the “world’s most important stock” – at least, before the past three months’ all-out commandeering of equity markets by desperate governments – the National Bank of Greece will officially be de-listed today, after having fallen from a “reverse-split adjusted” 2007 high of $703.00/share, to Friday’s $0.16/share. In other words, Greece is officially dead – which is probably why social unrest is exploding; and likely in the next 12 months, a political coup will occur, which is far more “anti-austerity” than Syriza, and far less likely to default on the nation’s unpayable $600+ billion of debt.
Next, the historic, global economic collapse – expanding further each day, with no breaks for “holidays.” Notwithstanding two new “copper and zinc PPT” efforts to boost collapsing base metal prices since Friday’s close alone, the global commodity complex continues to implode under the weight of nearly two decades of Central bank-fostered, Wall Street-abetted oversupply – pushing thousands of corporations, municipalities, and sovereign nations to the brink of default. Which, I might add, will likely become a far more imminent event after OPEC’s bi-annual meeting on Friday; at which, it is highly unlikely they will deviate from their current “strategy” of “maintaining market share”; i.e., pumping as much oil as possible, in a desperate attempt to pay their own exploding bills. This quarter, hundreds of high-cost producers – like the entire U.S. shale industry – will see last year’s above-market hedges expire. Thus, the imminent parade of bankruptcies and “high yield” and “leveraged loan” defaults will commence, to the tune of at least hundreds of billions of dollars – with no one to “bail them out.”
And no nation is suffering more than the “Land of Debt and Smog” – whose historic, Communist-engineered financial and equity bubbles’ collapses are accelerating with each passing day. Which is probably why the globally cataclysmic devaluation of the Yuan is quietly being stepped up; whilst the “Chinese PPT” works overtime to mask the Red Collapse with nearly daily, “Western style” “hail mary” equity rallies – such as today’s, which transformed the “follow up” of Friday’s 5.5% Shanghai Exchange plunge from a 3.2% loss to a 0.3% gain – yielding surging equity futures in other PPT-supported markets as well. Of course, the ominous fact that dozens of non-PPT-supported markets are collapsing – like the vast majority of Asian equities and currencies – is apparently not worth the MSM’s time.
That said, essentially all of China’s – and by proxy, the world’s – economic problems are rooted in the monetary “leadership” of the Federal Reserve. Which, as issuer of the “reserve currency,” has exported more debt, inflation, and social unrest than all other Central banks combined. And whilst the moronic, captive media focuses on when the Fed will turn responsible by “hiking rates,” the collateral damage of such acidic propaganda is corroding what’s left of the global economy. Exploding debt; collapsing trade; skyrocketing social and geopolitical unrest; and of course, the “surging dollar” – which in essence, is simply the “liquidity vacuum effect” resulting from global economic Armageddon.
To that end, HOORAY for Michael Pento – who this weekend, discussed this very topic here, in light of the ugly currency market movements ahead of Thursday’s likely QE and NIRP-expanding ECB meeting. In which, he validates exactly what I wrote in September 2014’s “if a nuclear bomb destroyed Europe.” Which is, that just as the Fed’s proposed “interest rate hikes” should have ZERO impact on Precious Metal prices, the “surging dollar” has NOTHING to do with “U.S. strength.” That is, if today’s plunging Chicago and Milwaukee PMI indices could be considered “strength” in the first place.
Which, of course, is the polar opposite adjective of what I’d use to describe the U.S. economy. Even the MSM can’t dispute that this has been the third straight quarter of declining corporate earnings; or the worst macroeconomic environment since 2009; the highest levels of individual, corporate, municipal, and sovereign debt ever; or the largest-ever Central bank balance sheet. Certainly not when potential Presidents-to-be are proposing massive, printing press-funded fiscal spending increases – like the $275 billion infrastructure Hillary Clinton proposed this weekend. Which laughably, pales in comparison to Bernie Sanders’ $1 trillion infrastructure spending proposal from last week.
That said, nothing Washington, Wall Street, or the MSM can fabricate will be able to mask the fact that this weekend’s “Black Friday” sales were an unmitigated disaster, of epic proportions. For months, I have predicted that even last year’s “worst holiday season since 2009” would be considered “boom times” compared to what was coming this year – which is exactly what major retailers like Walmart, Macy’s, Nordstrom, and JC Penney espoused this Fall. Well, even I was shocked to see Thanksgiving and “Black Friday” sales were down a whopping 10% year-over-year – presaging a holiday spending bloodbath, in the quarter where most retailers generate all their annual profits. Heck, even the “National Retail Foundation’s” list of excuses were laughable – as if its press-release writers were stoned or drunk while writing them.
Which is why, yet again, I can only ask “is the Fed that stupid?” – to even consider raising rates, amidst an unprecedented, global economic collapse in which the U.S. is suffering as much as anyone else. Let alone, as the aforementioned “surging dollar” is all but destroying corporate profits – as well as whatever still remains of America’s collapsing manufacturing base. Let alone, to do so in such a tiny, middling amount – which, if executed, would have ZERO positive economic impact; and an ENORMOUS negative impact – on economic activity, corporate earnings, global inflationary trends; and oh yeah, financial market valuations. The latter of which, as I have long espoused, is the only thing the “too big to fail” bank-owned Fed cares about. In other words, as I wrote three months ago, a Fed rate hike would be the “only financial event as potentially cataclysmic as a significant Yuan devaluation.”
The answer, of course, is that the Fed is that stupid – as in light of their horrifying track record, it is impossible to conclude that the so-called “smartest financial minds in America” are anything more than a troop of moronic Keystone Kops. Each day, charged with “kicking the can” a few feet further, with unprecedented levels of money printing, market manipulation, and propaganda – until inevitably, the historic, global fiat Ponzi scheme they lord over implodes under its own weight.
And nowhere are the hideous results of their machinations more obvious than in the rapidly destabilizing Precious Metals suppression scheme that their “partner,” the U.S.-government led “Cartel” – or as I refer to it, the “New York Gold Pool” – resides over. As Bill Holter masterfully described it this weekend, the “ugly truth” is being understood by millions of new “observers” each week – as relentless paper raids, such as Friday’s $1.9 billion “notional” gold futures dump at the COMEX open, and last night’s 123rd “Sunday Night Sentiment” raid of the past 128 weeks, are being seen for the frauds they truly are.
To wit, global above-ground physical inventories have never been lower – in the COMEX’s case, just one-twelfth of the aforementioned $1.9 billion of “paper gold” that hit the market within minutes on Friday morning, the thinnest trading day of the year. Whilst, in the words of ETF Securities’ Mike McGlone, the extended period of gold futures backwardation is “unprecedented.” In other words, the paper markets themselves are now intimating the extreme physical tightness depicted by record global demand and collapsing production. Trends which, unquestionably, will dramatically accelerate as worldwide money printing lunacy explodes in the coming months and years. Heck, even Bitcoin prices have been rising lately, as global fear of fiat currency devaluation accelerates. Thus, signaling the imminent stampede into any alternative to dollars, Euros, and Yen has commenced. Which is exactly why physical gold and silver demand is at record levels; and exactly why “TPTB” are fighting so hard to mask it with increasingly blatant, mining industry-destroying, physical demand-catalyzing paper price suppression. Which, unquestionably, will be overwhelmed in the not-too-distant future.