OK, I’ll go on the record. I believe “it” has commenced – also known as “the big one,” “Global Meltdown III,” or the END GAME, take your pick. Not that it necessarily means the world will implode tomorrow; but soon – perhaps, very soon. Yes, TPTB will do everything in their power to defer this inevitability by utilizing whatever “bazookas” remain in their arsenal of money printing, market manipulation and propaganda. Of course, it is our strong view that the “propaganda leg” of this tripod is broken; as frankly, it’s difficult to believe anyone truly believes any part of the world is or will shortly be “recovering.”
As we wrote yesterday – before the market plunged – we believe “2008 Is Back With One Temporary Exception.” That “exception” is PPT/Fed/ESF control over financial markets, which is decidedly waning as well; objectively, on the verge of being overrun in numerous segments. Global equities are plunging; and as “PPT operatives” can only control major indices, the vast majority of non-index included stocks are doing far worse. In the U.S., key indices like homebuilders are breaking down badly, whilst trading volume has surged and the trend toward speculating on risky companies has decidedly reversed. After a quarter century of observing markets, I know ugly warning signs when I see them, manipulation or not; and this is what they look like.
As the calendar turned from the low volume, highly manipulatable summer to the angst-ridden Fall, collapsing economies from “West to East,” and a simultaneous “commodity crash” have catalyzed fear-driven flight to the liquidity of the dollar and Treasury bonds despite their utter worthlessness. Thus, our May 2014 prediction of the “most damning proof yet of QE failure” – i.e., plunging rates despite a so-called “recovery” – was soundly validated. As was our January 2013 view that the “final currency war” was underway, yielding intense Central bank competition to debase currencies. The resulting, wildly volatile currency movements are exactly what we described in last month’s “single most bullish precious metals factor imaginable”; and as we espy the “ramifications” of this scorched earth monetary policy – including widespread global social unrest; it becomes clearer each day that the end game is not only inevitable – but perhaps, imminent.
Today is yet another Cartel “key attack event,” in this afternoon’s FOMC “minutes” publication. Consequently, the Fed desperately attempted another “New Hail Mary Trade,” by goosing Treasury yields in the morning’s wee hours. However, it has already reversed, and as I write at 11:00 AM EST, the 10-year yield sits at 2.34%, just three basis points from late August’s 52-week low of 2.31% when the Fed “painted the tape” by goosing yields ahead of the September 18th FOMC meeting. And thus, as the PPT, Fed, Cartel, MSM and every other “manipulation organization” prepares to spin last month’s FOMC meeting – in which, absolutely “Nothing!” incrementally hawkish was said – as bullish for stocks and bonds and bearish for PMs, not only are U.S. Treasury yields near all-time lows but those of the entire world. Yeah, the “market” will believe the Fed intends to raise rates – amidst an abysmal global economy, plunging stock markets and a financial system poisoned with a cancerous, irreversible debt addiction. To that end, Yahoo! Finance’s “top story” this morning is “FOMC minutes loom large for markets.”
Which brings me to today’s very important topic – of the “pink elephant” in the room we have long discussed. Which is the futures exchanges and ETFs set global gold and silver prices – particularly Western ones like the COMEX and LBMA, given that Easterners buy the vast majority of the world’s physical metal. And more importantly, how can anyone believe such exchanges are legitimate when so little metal is purported to back them? And particularly so for the “financial world’s Achilles Heel,” silver; where no more than a two billion ounces exist above ground – the large majority of which are in vaults like Miles Franklin’s at Brink’s Montreal, never to see the light of day.
For example, the COMEX, where naked shorting algorithms yield trade volume at least 100x greater than the amount of metal supposedly settled; a measly 66 million ounces of silver, worth just $1.1 billion, is the entirety of the “registered” inventory available for purchase. There are 1,500 billionaires on the planet and hundreds of thousands of wealthy institutions capable of taking out this miniscule amount. And yet, it never seems to get bought. Heck, in April 2011, when the industry essentially “sold out” as silver prices soared toward $50/oz. – prompting the Cartel to execute the infamous “Sunday Night Paper Silver Massacre” – we’re to believe the measly 26 million ounces of purported COMEX inventory wasn’t taken out? Yeah right!
Next, we have the “London OTC” markets – which, as I learned on David Morgan’s Masterminds call last week have a comical lack of transparency regarding the amount of metal actually delivered. According to David, who will be participating in Miles Franklin’s “Silver All Star Panel Webinar” next Thursday, there is essentially zero data regarding London OTC inventories. And thus, in the city where the gold fix was recently dismantled due to rampant manipulation – in the words of the President of Germany’s BaFin, the equivalent of the U.S. SEC and CFTC, “worse than LIBOR” – we’re told to “take the word” of the world’s leading financial criminals that metal exists. Then, of course, we have the SLV ETF administered by none other than the world’s largest paper silver short, JP Morgan. Its inventory has never been – and never will be – audited, but we’re to believe it somehow amassed 350 million ounces of silver, nearly 20% of the aforementioned incredibly illiquid global supply in just eight years’ time. And better yet, in doing so, the price only increased from $11/oz. to $17/oz., when the cost of production is closer to $25/oz.? Yeah, if you say so.
But most damning of all is the paltry $50 million of silver inventory supporting the world’s largest silver delivery mechanism, the Shanghai Futures Exchange. Actually that number was as low as $40 million last week, when a scant 80 tonnes of inventory were available for purchase compared to a slightly higher 95 tonnes today.
SRSRocco Report
According to SFE data, nearly 1,000 tonnes have been withdrawn since April 2013’s “alternative currencies destruction” paper raids; depicting in crystal clear manner, an all-out panic for physical metal. This gibes perfectly with similar data as Indian silver demand – despite onerous tariffs – hit an all-time high in 2013; as did North American demand, given record high silver bullion sales at both the U.S. and Royal Canadian Mints. And FYI, as the paper price continues to be attacked on the COMEX, Indian demand is on pace to match 2013’s record levels – as are silver sales levels at the U.S. and Royal Canadian Mints!
Equally amazing is that this is occurring simultaneous with last month’s launch of the SFE’s “International Board,” enabling tens of billions of international investment into Shanghai’s physical-only gold and silver contracts. How much more powerful of a statement of looming shortage – as we experienced in 2008, 2011 and 2013 – can be witnessed than the gaping difference between said tens of billions of potential investment and a measly $50 million of inventory?
In real markets, of course, the vultures would have long ago “smelled blood” and taken out the inventory – let alone, eagles like “Admiral Sprott” and Stefan Spicer through the PSLV and CEF closed-end funds. And thus, we have the sneaking suspicion that not only some, but most of the purported inventories are non-existent from the fraudulent COMEX, LBMA and SLV to the so-called “honest” SFE. Surely, some supply is available; but compared to explosive global demand, we find it hard to believe this meager declining supply will be able to “keep up” much longer. Thus, we strongly believe the days of “key attack time” raids like this morning’s – at EXACTLY the 10:00 AM close of global physical PM markets, with interest rates near their lows and stocks plunging (except the Dow, which “coincidently” erased its losses ahead of the FOMC minutes publication) – are nearing their long-awaited permanent end.
And when this inevitability unfolds, if you haven’t secured your share of the metal actually in existence – particularly silver – you may never get another chance. Or at the least, anywhere near the current Cartel-subsidized prices.
Andy. I listen to your rants often and with all due respects..We have heard all this over and over. If it is that blindly obvious that only 50 mill is left and for the taking someone with money who likes to make more money of which there is no shortage would have ‘done it’. If it is such a no brainer WHY would it just be sitting there with no takers whilst the price keeps declining..I’m sorry but I just don’t buy it anymore..You are obviously pretty experienced and no fool by a long shot but the arguments are just too biased in my opinion..The boy who cried wolf comes to mind with several silver ‘gurus’. We will see in good time I HOPE. Keep writing and perhaps cover other topics as I personally am really tired of the same rhetoric over and over.Thanks!
Matt,
Give me a break! I said flat out that I don’t believe any of these numbers, and have for years. In fact, I stopped writing of the “imminent default” on the COMEX a long time ago, for that very reason.
My point is TPTB only purport to have a tiny bit of actual inventory – which, by the way, David Morgan and countless experts agree with. I’m simply saying the line between supply and demand is razor thin. And since we have had multiple shortages in recent years, it is definitely a REAL issue.
a
Andrew, the best way to explain complicated concepts to someone like Matt is with crayons. I, on the other hand, say thank you for all you do. Bill Holter and you have joined the ranks of people like Admiral Sprott, Mr. Gold and the GATA guys. Should Life, Liberty and the Pursuit of Happiness exist in the future it will be because of warriors such as yourself.
“Warriors are not what you think of as warriors. The warrior is not someone who fights, for no one has the right to take another life. The warrior, for us, is the one who sacrifices himself for the good of others. His task is to take care of the elderly, the defenseless, those who cannot provide for themselves, and above all, the children, the future of humanity.”
Sitting Bull
Thanks for the reply Andy..I am in no way attacking you on a personal level but as you may or may not agree, the reasons WHy just one of these billionaires wouldn’t take out remaining inventories in order to ‘expose the manipulation’ is not being discussed..Not from what I have read anyhow. In Australia there is NO problem sourcing it and pretty much NO talk about why one should stack..which may be a good thing.
I read most of your stuff time permitting and would love to hear some info from OZ miners and their take on it.
Thanks Andy for your time and effort
Hang in there Andy, you will be laughing all the way to the gold/silver back bank soon enough. You will die knowing you did your best to wake up the zombies! Brian FL
I understand Matt and grow weary but what you bring out is very important. I need to know there are others out there looking for this bs to end as much as I do. I think we’re all tired of this but we can’t tire out. The trick is to stick together and glean as much encouragement from one another. I KNOW this will blow over with a big bang, the process is arduous though.
I too have listened to your rants for years. I find them extremely interesting an informative. I appreciate your efforts in this, your area of expertise! I sum it up this way Sir – At the end of the day, pretty hard to be upset while looking at a pile of silver.”. I appreciate the education.
Andy: re silver supply. It will be interesting to see the production numbers from the silver only mines going forward,and the “allocation” timing of the US, Perth, and Canadian mints on all silver coins. I would imagine that if you are right, and I think you are, the quarterly and annual numbers should confirm this.
It all comes down to these fundamentals:
1) Gold & Silver = real money, store of value
2) Fiat Paper Currencies = always go to zero
You can start building your reality based on those two principles.
Thanks for the great article Andy, I’ve been watching SFE lately and trying to research more info on other physical silver reserves….
Thanks, happy to look at whatever you find out.
a
@ Matt, I humbly suggest you sell any and all PM holdings to stronger hands and, perhaps, invest in the stock market. It is red hot. Or, CD’s….you’ll make 1% a year.
Wishing you all the financial best, Steve
TYVM Andy! This is a great article! Of course most of us get discouraged, because it is absolutely absurd that we are in this position! You are one of the good guys, and not one that is plundering the silver and gold holder. Thanks.
You’re very welcome!
Keep,stacking XXX oz a month. I hope this sale goes on for 15 more years; retirement will be great. Throw in an oz of gold here and there.
Scott,
I’m not sure why people speak of the suppression as a blessing. It is not, it is destroying the world. And at some time, when you’re “all in,” why would you want to wait 15 years?
a
I guess its because everyone has different goals when buying precious metals, for some its an investment and they want to bank on it when we have the reset, for others its an insurance policy, to me its both. But I’m definitely not willing to wait 15 years, so there is a TIME factor and it should be planned and considered before buying.
Andy,
I have been slaughtered by the crooks on wall street and London. I am surprised that they have let you live. They will just keep doing the same things they have been doing for 40 plus years…they do the same in oil and every other metal. You are right but so very wrong about a collapse…endless derivatives at play and it won’t collapse.
Very confident, aren’t you? I am “so wrong” about collapse, due to derivatives? Quite vague, and not rooted in anything other than rank speculation – as opposed to the reams of FACT I write of each day.
It’s up to you to protect yourself from what might happen, or do nothing. Just as I wrote in “protection continuum” (/the-protection-continuum).
Andy,
Keep up the good work.
We have all heard what Matt is referring to and it can be easy to get down and stop believing, but once that happens the liars have you whipped!
I don’t want my wealth stored in toilet paper (aka US bucks). No backing – no good !!!
I’ll rely upon what has been wealth for thousands of years. Any one that thinks they can rewrite what wealth is can go ahead and admit defeat!
Again, your work is greatly appreciated.
Amen!
No disrespect to Matt. But I’ve been hearing a lot of people talking like this. Seems like a capitulation signal.
Andy – I agree with John. You’re 100% right in relation to centrally controlled markets but I think you’re way off the mark with imminent collapse theories. I agree with all your historic views of gold as the ultimate store of value but that’s not to say that it is the ultimate future store of value. To the extent that the fiat system has to be overhauled with real value, this could take the shape of a basket of soft and hard commodities – in fact if all the gold inventory is gone then we can be assured that any future backing of currency will not be gold! The current system could take years to play out and I don’t see a global revolution against fiat currencies – people are not that rebellious.
You’re an intelligent guy Andy and with intelligence comes the constructiveness to challenge ones self on their beliefs. I would like to see a posting on other possible scenarios including commodity basket backed currencies, inter central bank debt forgiveness, structurally low interest rate environment, etc. regards
I DID NOT say imminent, but inevitable. And the reason I am so much more confident now is because the system is collapsing, as we speak. This is undisputed.
As to a “basket of soft and hard commodities,” that is just pure heresay. I wrote “Is gold money – who cares?”(/is-gold-money-who-cares) because I don’t really care what the next system looks like; only that this one must collapse, and only Physical PMs are guaranteed to maintain their purchasing power when it does.
And please don’t lecture about challenging one’s beliefs. I do it every day, and in this realm, have done it as much as anyone on the planet. I have my views, and you can decide for yourself what other scenarios might occur.
I wish u were correct, but Pric says no way.
Like the Chinese story of looming empty Silver warehouses…oh ya! heard this for a month …as the Price goes down some 15%.
Oh ya, evryone knows re china shortage but, maybe it is a big scam, eh?
All “stackers” are now the ‘walking dead.’
Eric Sprott, J Sinclair, The Jackass Willie and James Turk all have destroyed people’s finances by their reckless Silver hype and promotion.
Any Silver people feel like a winner today, eh what?
Blair,
Are you a Cartel plant? I mean, how much textbook propaganda can you inject into one quick blog post.
I am doing just fine, as are those that hold their SAVINGS in physical metal.
I hear it said that people who try to take delivery of gold, or silver from COMEX subjected to delays, and fees that are nowhere documented in order to actually receive their metal. I’ve also read that people who get together the 100,000 shares of GLD necessary to take delivery of metal are denied, unless they are JP Morgan. Is there anyone who will go on the record as witnessing these failures to deliver?
I have heard all those things, too, and I’d bet some are true. This is the end game, when every last trick is used to stave off the inevitable supply shortage.
Andy,
Several vocal millionaires in the pro-PM space “could” take out the minuscule amount of silver at the COMEX and yet they never seem to buy.
Why is that do you think?
Great question. My guess is many have, but as I wrote this morning, the fraudulent exchanges simply lie about the numbers. They are clearly sourcing just enough – from the fumes of inventory (GLD/SLV, Ft. Knox, custodian holdings) that still remain (ask the Germans) to hold off the inevitable default. But in time – likely, much sooner than most can imagine – they will run out. It’s a mathematical certainty.
You never mention Rothschild. Don’t be a chicken. When/if they get kicked away
from the commodity exchanges in the far east, THEN something will happen with
prices. NOT BEFORE.
Chicken? You’re kidding me, right? What do you think I do for a living – and have done for a hobby for the past 12 years?
As for Rothschild, I don’t mention it b/c I don’t believe in that conspiracy theory garbage.
You are looking at silver on warrant, the warrant being created when the long asks for delivery (note due to the rules in shanghai the power of long vs short is reversed). No longs creating delivery, no new warrants. The amount of silver available to create warrants is not public, at least not that i or anyone else I know has found.
Every credible analysis out there points to extreme scarcity, no matter what BS numbers fraudulent exchanges publish. However, the fact that they publish such LOW numbers, when they could simply lie and say they have “tonnes,” tells you how close they are to being overrun.
So,comex has short sellers that create registered silver, those numbers are near highs. In shanghai the long drives the show. Why would the show small numbers? Well first, comex does not, and in shanghai I mentioned the reason why (mechanics) in my first reply.
Yes, these are small numbers!
The registered inventory is a measly $1.1 billion worth, and the eligible inventory a measly $2.0 billion. This is chump change, compared to the tens of billions printed each day.
I still don’t see a collapse and a mad panic to buy gold. Governments have detached their currencies from gold and I don’t see them going back under any circumstance. World currencies are very different to when Wiemar occurred and I think if there comes a currency crisis the world CB will strike an arrangement with its CB members to address. I know this type of view doesn’t help gold sales but it is probably more realistic than global currency collapses and hyperinflation.
Governments have detached their currencies from gold? That’s a positive? Their currencies are COLLAPSING as a result, just as every attempt to do so in history!
Look, you don’t have to agree with me. Do whatever suits you. But history’s on my side, and history is occurring NOW.
Not saying its a positive Andy, just saying this is the current scenario..
What is the USD collapsing against.?? Nothing, it’s strengthening against other fiat currencies.
History is a guide but the vastly changed context needs to be recognised – globalisation, interconnected monetary systems, etc.
Again – I don’t see any currency collapse. As peter schiff once said, you either save the balance sheet by destroying the dollar or you save the dollar by restructuring the balance sheet. I’m in the latter camp and I think you are in the former.
Current, as in this month? The dollar has been in a range of 70-90 for a decade, and when it “strengthens,” it’s not because our outlook is better, but because the currency war just takes turns. They are all going to hell. And as for what it’s collapsing against, not a person in America can claim a lower cost of living – over ANY time period. And if it weren’t for manipulation, PMs would be dramatically higher – which ultimately, will be broken.
And as for currency collapse, what part of the average currency down 20% since the Fed’s money printing explosion three years ago are you missing, and 40% for the Fragile Five where a quarter of the world’s population lives. Or the 45% plunge in the Yen, or the devaluation of the Swiss Franc, or anything else.
I am too busy to just refute the obvious – which I write about every day!