As “goldbugs” – i.e., those that believe 5,000 years of natural economic law have not been repealed by government computers – sting from yet another paper raid; the main “tool” of said computers, the New York COMEX, runs dangerously low on actual physical metal. We’re told the economy is “recovering,” yet construction spending was so low, even Goldman Sachs lowered its 4Q GDP growth estimate to barely above 1%. And did I mention the nearly all-time high channel stuffing among still government- controlled auto manufacturers?
The stock market may be at an all-time (nominal) high, but Obama’s approval rating is at an all-time low; as per below depicting homelessness, only “the 1%” are benefitting from America’s economic policies. Simultaneously, it was reported that Shinzo Abe’s approval rating is also plummeting to new lows; also, as the Japanese stock market makes new multi-year highs. This simply does not happen anywhere but Wonderland, Fantasyland, and Neverland; certainly not in legitimate economies, with legitimate markets!
Around the world, the hyper-inflating Venezuelan Bolivar (and stock market) aren’t helping “the 99%” either; as yesterday afternoon, the ultimate irony unfolded when a national blackout occurred amidst President Maduro’s speech outlining how Venezuela is being taken to pure socialism. And if you think that’s bad, just wait until Obamacare’s fully implemented.
Simultaneously, two additional revolutions broke out – in the Ukraine and Thailand; also blamed on oppressive governments, which in 2013-speak means exported inflation from the Federal Reserve and other Central banks. Add them to the list – with the “Fragile Five” and “Arab Spring” nations, among others; a list that will only grow longer as the money printing continues. At the moment, the MSM is too focused on Bitcoin and the handiwork of the U.S. President’s Working Group on Financial Markets to care; but don’t worry, they will be forced to acknowledge this rising global nightmare that as the death throes of the fiat currency Ponzi become increasingly visible.
And then we have last week’s news that the Chinese government no longer intends to acquire foreign currency reserves; an announcement, of course, with tremendous inflationary implications – as they’ll be taking their $3.7 trillion of dollars, Euros, pounds, and Yen, and using them to buy items of real value like gold, silver, oil, and wheat. Coupled with yesterday’s news of the Yuan surpassing the Euro as the second most utilized currency in international trade finance, you can see the route to an inevitable, gold-backed Yuan is becoming shorter each day.
And finally, for the true “oppressed” of the financial industry; i.e., those holding the assets poised to benefit most from the cycle of monetary lunacy encircling the Earth, we have this article focusing on what I have discussed ad nauseum all year. That is, the Precious Metal prices are already below the cost of production for all but the largest of mines, and well below the marginal cost of new production. In silver’s case, the situation is that much direr, as 70% of such production emanates from base metal mines; which themselves are in terrible shape due to the weak global economic environment.
In sum total, the “horrible headlines” that have driven our decision to protect assets with gold and silver have never been more widespread; and sadly, are set to expand further as the global fiat Ponzi demands more money printing, draconian government controls, and capital misallocation. As for me, I simply buy metal whenever I have cash; which is exactly what I have been doing for the past five years, and what I will continue to do until there is no more left to buy.