So many topics to choose from today, Russia is pushing back on sanctions and has already begun to cut gas supplies to Europe. The Scottish independence vote which if “yes” means the end to a 1,000 year empire and brings into question the Anglo American banking and financial systems themselves. The ISIS situation and whether (in reality “how”) we go back there with boots on the ground or not. We also have the FOMC meeting and statement coming today where we will find out whether QE will be publicly discontinued or not …I say “publicly” because the reality is such that QE will remain forever whether admittedly or in the shadows and hidden from view. We also have news of India tripling their gold demand as new physical gold exchanges open in China tomorrow. The “live” date has been pushed forward by a week or more, I can only wonder what this means because the Chinese NEVER do anything by chance or without reason.
I could have chosen any of these topics but I had a conversation with a very long time friend and client this morning and he brought up the question that seems to be burning in everyone’s mind, “when?”. When does everything come apart at the seams? Please don’t get this wrong, he was not asking me “when?” I thought, rather, he was commenting on how many people are expecting some sort of “slow burn.” He said “so many people think this will be 3 years, 5 years or even 12 years” to unravel.
Here is the point, the “fuse,” or I should say “fuses” are lit from so many different directions I don’t have enough fingers and toes to count them all. Only one fuse (cause) needs to reach the powder keg but the way it looks to me is we will more than likely see many reach the powder at the same time. When I say same time I believe all within the same week as many are interconnected and many will be advanced by the ignition of others.
When my buddy said “3 years” I immediately said to him “you mean 3 days right?” He said to me, “That’s exactly what I’m talking about, once this thing goes how can it last more than 3 days?” Let me explain this, once we “ignite” I don’t see how the markets can function for any more than 3 days (two weeks at the absolute maximum) before being closed. Today, everything relies on everything else for “value” or “foundation.” It’s like a building block tower where pulling even one block will take the whole thing down…and this happens quickly, NOT in some slow motion, slow burn or controlled collapse. This would be nice but unfortunately not the case.
Let me backtrack just a little to make a clearer picture. Back in 1998 LTCM was feared to be one of these “building blocks” that if pulled would take the whole system down. They had capital of just under $5 billion and borrowed $125 billion with derivative notionals of $1.25 trillion. So this was leverage of 25 to 1 and then levered into derivatives another 10 to 1. This was considered “crazy” and enough to crash everything so they were rescued, sliced, diced, bailed out and wound down with a huge sigh of relief. (By the way, it was rumored they had a short position of some 300 tons of gold that needed to be absorbed and swept under the rug, this I believe was only a sign of things to come but a topic for another day).
Fast forward to 2008, leverage of 25-1 was considered “old school conservative” and falling behind the curve so to speak …until the Lehman moment threatened to stop the music. Again, slice, dice, bailout, raid the Treasury, print and borrow trillions of $ upon trillions of $ and another, even more huge sigh of relief… sort of. I say “sort of” because we never really recovered. Nothing has been fixed, governments themselves are now insolvent and broke, leverage is now higher, derivatives more bloated and widespread, and now no “white knight” anywhere capable of riding in to save anything.
What I am trying to say is “what happens this time?” Notice I did not say “next time?” I said this time because “last time” really never ended and was certainly never fixed. This time there will be no bailouts, no sovereign borrowings to save the world or anything else. Just look at the Federal Reserve, they are levered 77 to 1. Were they a bank or a broker …they would have already closed themselves down based on their own rules! They are THE most levered hedge fund in the world …and they do what? They issue the reserve currency that the rest of the world uses as a foundation for their banking and financial systems! You do see the folly right?
OK, before going any further I want to mention another aspect to this thought of “just three days.” I e-mail and converse with a very large precious metals money manager and one of the most well-known “gold guys” several times a week. He is as smart and well-spoken as they come and a really fun guy to throw “too many” back with. He has been in the business forever and was one of the original “voices from the woods” back at the end of the 1990’s promoting gold. He e-mailed me today and asked, “What do you think ‘they’ will do to gold and silver after the FOMC announcement this afternoon? Do you see where I’m going with this?
I mean no offense whatsoever because I really have the utmost respect for this guy but what has happened over the last two to three years has even messed with his mind. Yes I know, it is a logical question and having the answer would be nice but… it doesn’t matter! It does not matter because the system is now completely unstable and will come down and “through” the foundation itself because the “foundation” is a complete fraud. I wanted to point this out because if one of the smartest and most steadfast names in the entire business is shell shocked and jumpy by daily movements then we have to be very close to something breaking. I can say this because the “psyop” of smashing gold and silver to break sentiment has worked so well that even the smartest of the smart are questioning themselves and having their concentration broken. Don’t get me wrong, I don’t believe he has sold even one ounce of anything over the last 15 years so his resolve is not broken but his concentration has been momentarily.
Let me explain the above a little further, at this point “nothing matters” except the end game. It doesn’t matter “how” we get there. Fed this, QE that, manipulation, naked shorts, frauds galore …none of it matters because it will not change anything and can only delay the end game …but the end game does not change. The “end game” I am speaking of is the event, not the actual snapshot of a closed global financial system smoldering and worthless. The “end game” will be in my opinion a 3 day event (maybe 10, maybe just a weekend) which completely changes the psychology (and surely net worth counted in ounces) of every market participant in every market. The vast majority will be burned and the greatest transfer of wealth in ALL of history will take place …in a very very compressed time frame.
There will be no time for professionals (forget individuals) to get repositioned correctly so forget about the “I’ll do what I need to when I have to” mentality. Do NOT let your concentration be broken, do not question your logic and do not let your guard down. The rest of the world has “had it” with the fraudulent West. This is the answer to “why can’t the Fed just kick the can for another 3 to 5 years?” The rest of the world will not stand for it, they have prepared to change the world and they will do this. They have every ability to do this and we have given them every reason to do so. “Wondering” when is pointless as long as you know that they will.
I will finish by saying we now have a very good “tell” that what comes is already under way. I had speculated for several years that Jim Rickards was a CIA spook, it turns out I was correct and even he admits his ties several times in this link Senator and CIA Insider Accuse Federal Reserve of Covering Up Secret Bankruptcy. He is telling you the same thing I have for several years. Only a year ago he was saying “5 years,” now, well, he is saying “now!” Jim Rickards if you recall was the lead counsel for none other than LTCM in 1998 and oversaw their unwinding as they nearly took down the world. Please view the video, it is fairly long but for the most part I believe you are hearing the truth. He pulls very few punches by saying the dollar will die. Please understand how the elites work, it is considered very bad etiquette if you do not warn your “marks” ahead of time. If they do not listen or take heed …oh well, that’s why they are called “marks!”
I tried to access the link at the end of the post, but it didn’t work.
The link has been updated.
works for me? I will check.
Thanks. Working for me now as well.
Wow. You are right…the “end game” is the only thing that matters right now. I used to get excited about the “gains” I could realize, but now I’m just plumb scared.
great summation.you are so darn right when you say,”the elites always warn you before they do something”.people think i’m nuts when i point out stuff and when things happen they ask,”how did you know”,i say,because they said they were going to do this or that.you have to know what to listen for when they speak,and which msm mouthpiece they use.good column Bill,thanks.
thank you Chris.
Chris, I experience the exact same thing. When I try to explain to people, they either laugh or change subject instantly. Awkward situation.. I tell them that they’ll get “it” one day.. And I also tell them that their ignorance is to be considered “an asset as long as time allows”. That’s when the conversation goes silent. 99% is screwed. I might also be screwed, who knows?! At least I’m trying to screw the bankers first! Bastards! 😉
the word “ignorant” will stop any conversation anywhere…here in Texas it usually is the beginning of fireworks.
Fireworks might be just peanuts, compared to what we’re up against. Better to have a feisty conversation than to have the military boot kicking your ass. I don’t care what they think of me. This is serious business. I’m quite determined. From Belgium. Regards.
“fireworks” is a fist fight or worse a gunfight, what is happening now could easily lead to WW III actions.
Hi Bill, excellent to point out that “it” concerns the reserves of the entire western banking system. It will be everyone right? This is not just about the USD, but about ALL forms of paper wealth? Do I read you correct?
I do not understand this East versus West narrative that you subscribe to Bill. If true, then why are the western banks giving up their physical gold to the eastern banks, something that historically required military invasions?
what happens when gold is no longer delivered? The jig is up right?
I also don’t understand why the “west” has been sending gold to the “east”, if the elites know that is the only asset that will survive? That doesn’t make sense? Can you explain more of why they are allowing/doing that?
to prolong the “power” game plain and simple. It is called kicking the can down the road and “hoping”.
Thanks, but I don’t think they are that “stupid”…to just hope. I think they have a definite plan of what they’d LIKE to see happen, and if it doesn’t involve metals, it would be useful to try to glean what it does involve. They clearly, if they are disgorging metals, counting on another plan of “exit” for themselves. They may be psycopaths, but they are not stupid, and they are not selfless and not greedy (it’d be easier stating the affirmative of course). So…I’m just trying to figure out what they think they could be doing, knowing that we (west) would have no metals? I’ve posed this question to many metals pundits, and not a single one has responded with any real answer so far. I was hoping you might opine on it. Because it’s illogical to think that they are just shipping metals away KNOWING it leaves them with no POWER at the time of a reset/collapse. They would not do that. IMHO.
it does “kick the can” and buy time. You do know what “the Manhattan project” was right? No one knew about the “grand scheme” only what their own personal jobs were? Whatever or whoever is behind it is treason or treasonous. There are so many boneheads in Washington they cannot be counted, getting “paid” to do what you are told and not asking any questions is a normal daily occurrence, I unfortunately believe this to be the case.
Red (& Bill) if I may,
“They are not stupid”
Well I would see it differently.
They have erred and disturbingly so. To the point where they are now cornered like a Rat. Gold is the antithesis of the USD. Suppression of Gold (via the paper shorting/futures markets) is to maintain the USD hegemony. Physical delivery of gold is necessary to cover long positions on the Crimex… is the unintended consequence of the game. China/Russia/India have worked out the game long time ago. They are the buyers in the market which the central planners did not anticipate being the strong hands. Protection of the USD is absolutely paramount to the continuation of the monetary system that controls the globe (and all of its resources). They can attempt to take the leverage on gold beyond 100:1 …who knows maybe closer to 500:1…but the critical point is …how much physical gold do they have to “play with”. “They” know full well that there will be a new world currency and that the USD is dying a slow and painful death. It cannot happen overnight without total destruction (which goes beyond what Bill talks about in this blog). When it is ceded there will still be a flood of USD/UST coming back to America that will cause massive social and economic unrest. That ..as they say…is already baked into the cake.
the “flood” back to the U.S. of dollars IS the hyperinflation as is (will be, should be, …maybe) calculated by BLS even though the real hyperinflation has already occurred. My point is this, when the “flood” occurs, prices on anything and everything you want to buy will explode. And as for your comment, no, they are not stupid, they just f’ed up way big time in their delusional hubris.
One more comment Red in addition to my longer one at the end of the comments section, don’t forget that a lot (if not most? I’m not sure) of the gold held within the borders of the US was other countries’ gold. The Fed was supposed to be safeguarding this. So at some point along this gold leasing scam, enough gold was leased out so that if it was all revealed to the rest of the world what was happening, then all those other countries would demand their gold back and the US would be left with none, due to simple subtraction. So once past that point, they probably said, “oh well, we’re screwed anyways, we might as well take it to the end and use this as an opportunity to enrich ourselves and our cronies at the expense of everyone else”.
Another explanation is that all the western central banks are controlled by one single very wealthy family who knows exactly what is going on and always has. They have intentionally drained the supplies while at the same time building up huge personal stockpiles, and plan to use this to completely rule the western world after the collapse since the individual countries will have no choice but to bow down to them as they will have no gold with which to back a new currency. It is the most cynical view but sadly I see it as the most likely explanation as it seems to agree with all of the bizarre behavior of the western nations that seems to be suicidal. I don’t think it will work out as they plan though, as John Michael Greer has just writen a piece describing the inevitable fate of elites in failing civilizations…
I really don’t know which explanation is correct; that’s what makes it all so fascinating.
hopefully they don’t kick the table over first.
Hi Bill, This series of How, What, Why and now When articles is, without a doubt, your best work to date. I forward different articles of yours to family members from time to time, but this group surpasses anything I’ve yet sent. They of course continue to ignore them, but this one, with the Rickards link included really puts it out there in black and white. I am so grateful for the work you are doing. You are a testament to and an advocate fore the best of the human spirit, Mr. Holter.
thank you for such kind words Chris. At least your relatives don’t return the e-mail back to you labeled “SPAM”!
Another spot on summation..The Richards video was very good, but do you believe the SDR will be the new ‘World Money’??..Here is a good article by Bullion Bank Canada on this very issue… http://bullionbullscanada.com/intl-commentary/26557-the-next-reserve-currency
Please keep up your great commentary and insight..I never miss one of them..
Thanks David, no, Rickards is just a CIA spook promoting what they “hope” to be.
Best article yet Bill. And to think ive had conversations with JimR before.. so close to the hourses mouth and I didn’t even know.
Thanks Adam, after I met him and he didn’t know that no audit had been performed in over 50 years …I would say horses ass.
I meant they are selfish and greedy (in the above of course). I should have stated it in the affirmative in the prior post as it’s easier to read that way.
Congratulations Bill.You nailed it.
What astounds me is the lack of awareness on the part of professionals in the Gold / Money management space.
Your thoughts resonate very closely with mine.
It is very true that there will be no time for repositioning when the clock strikes midnight.
I am very pleased to see that you have clearly moved on from “having a financial collapse when we should have had one -(2008)” and now communicated/inferred the ramifications/consequences of and more importantly stated… whether it was then or now is inconsequential…..we do end up in the same spot.
I especially liked “controlled collapse”….and I see that a few others have changed their tune.. so to speak.
When you have a public voice…you wanna get it right.
Where possible I try to lend a voice too, without ridicule.
I sincerely believe this time you hit the bullseye.
Thank You, Silence.
I have wondered about Red’s question as well. I think most of them are so brainwashed by their Keynesian theories that they actually believed all this stimulus was going to be able to create the “wealth effect” they dream of where market manipulation causes people to think they are rich so then they spend, then that stimulates production and job growth, then the economy grows some more, yadda yadda yadda. Of course it doesn’t and didn’t work and I don’t think those at the top are so stupid to not realize the end game, but I think that when they realized it was too late, most of the gold was gone. So they have I’m sure amassed a lot of personal gold from the remaining dribs and drabs and just kept the system going for as long as possible to position themselves as best as possible. The financial looting of America continues to this day.
On a different topic, I find it interesting that the majority of the gold demand as revealed by Koos is from private individuals in India and China. This will make any potential failure to deliver unavoidable and un-hideable because there is no way to just “turn them off”. If it was central banks buying it all (of which I am sure they are buying a lot, don’t get me wrong), then a central bank could decide that they aren’t ready to collapse the system yet and would just defer demanding physical until they are ready. Not so with millions of individual purchasers, that 2000 tons per year shortfall cannot be turned off no matter what they do now. Which is why…
This bumping up of the SGE opening by a few weeks is definitely intriguing, and one has to wonder if it is an attempt by the BRICS to bring down the dollar before the US war over ISIS really heats up, to hamstring the US before they can even start. Or maybe because both sides know a default is imminent and they can’t wait that extra few weeks? Or maybe OTOH they just managed to get things together ahead of schedule and decided to open early? That last explanation seems suspicious to me. We shall know shortly…
What do you think will happen to our self-funded retirement accounts that are in cash (i.e. out of stocks or bonds?)
cash will be trash.
Those “three days” will feel like “three seconds” 3 or 4 months after the collapse.
If you are not some what prepared now when the collapse happens it will be impossible to get much done other than cry.
No one can be totally prepared, but you better have some food, water, medicine, etc. in place now or you are screwed!
do the best you can do.
Great Blog. I was introduce to you by USA Watchdog few weeks ago only, It’s my loss.
Reading your writing daily and with great pleasure.
I have been suspecting Jim Richards for the last one and half year (my time in finance after retirement)
You are the first one that confirms my distrust in him, as quite few things he write and say are the complete opposite to many other in the business.
Thank you and hope you keep writing.
thanks Aaron, glad you found our blog, tell your friends.
I think one take-away from this article is that you had better have a nice stash of gold and silver when the door blow off the global financial system and economies. While they may faint a little at the onset, it will become quite apparent to those with a pulse, THAT THIS TIME IS DIFFERENT and no White Knight is with armor or horse or lance to come to the world’s rescue. The Dollar will be replaced by 3 or 4 alternative baskets of currencies for international transactions, the largest U.S. banks will disappear, replaced by strong regional banks, and the U.S. will become a lesser power in the world with a much lower standard of living. Have been saying this for over 20 years now by the Fed has finally run out of bullets. Got Gold?! Got Silver?!
The U.S.A. is the greatest country in the world. This country is so great that other countries, despite their own poverty, are eagerly to lend us $1 trillion a year to pay the interest in the debt we’ve previously borrowed from them, even though they know the “loan” is truly a gift. And, since the money won’t be paid back, who cares if it’s at 4%, 6%, or 3% – let’s just lend the US money at 2.58% for ten years! Hey, wait, why stop there? Let’s lend Spain money for 10 years at an even lower yield, let’s say 2.18%. What? Of course I know that Spain’s debt is 94% of their GDP. What’s your point? What? Yes, I know that as recently as 2008 when Spain’s debt ratio was only 36.1% that the bond yield was in a range between 4 and 4.8% and that a larger debt balance generally means more risk and that yields should go up and not down. But this time it’s different, and if you’re going to go by the old playbook, and not the new economics, I can’t help you. If you’re going to hold on to that stupid gold while we pound your head against a wall for not getting with the program, I can’t help you. We have your names, and we will come for you at the appropriate time, if necessary.
funny! …but true.
And for the very low price of $39.50 you can get my book and all of my videos on how you can save yourself and your family from financial destruction !
After about 2 mins of the interview I was thinking how bad is Rickards haircut and what sort of tool is the guy running the sales pitch.
Anyway I am not buying it (the package).
The way things are going I will soon be able to get 4x 1 oz newly minted silver coins for less than the cost of his package.
Bill, I think long and hard on this comment. I already apologize for size of the comment. You may consider posting it, or not. You own this house 😉 Things are not OK at all. Many colleagues at my work place are tired (and they are young people). They fail to “do the week out”.. This is no speculation, it is observation. Something i’d rather not have to observe. I know what causes this, yet it is so big, abstract and beyond the imagination that is just becomes very hard to explain. Also, I’d like to rectify a word used in this comment section. When I say “ignorant”, it is not an exact translation of the word used in the discussion. But then – again – I think … “if people are offended by the word “ignorance”, they better get they act together now (!) and man up”. What is this?! This is some serious business. How come people don’t see it? I know I know. Call me crazy, but I’m actually planning on printing out some parts of the comment section in hard copy format. People should realize that there is quite some valuable information being shared right here. I do not point at my own comments (sometimes I get overwhelmed by “the emotion”, just like any other human being, and I start typing …) I’m looking for one fast event that brings the entire sick game down. I do not welcome it. As stated before, the blood pressure was up too high when everything became “obvious/clear”. I promised myself to never go down that path again a few days ago. But I sincerely fear the day when the majority of the Western World, defined as 99%, gets to know what I know. Quite a mess we’re all in (..). Oh, I’m still replyingunder a bogus-email, but I’m on the waiting list for Protonmail. Just sharing..
The China connection is so interesting. KWN had this on their website today. It is incredible. Did this show up on any other media site that you know of? Great stuff you and Andy produce.
“Even the president of China National Gold said that the renminbi, which is becoming internationalized, should have a gold backing.”
It completely fits with what I have written for Monday, please read it and see what you think.
I will definitely read it. My thinking is that the Chinese are working towards a gold-backed yuan to challenge the petrodollar. If the Saudis were offered gold-backed yuan for crude oil instead of US dollars, what would happen? I checked the EIA website and found that in 2013 68% of Saudi crude oil exports were to Asia. Also, there is this: “Since 2012, Saudi Arabia has been the second-largest petroleum exporter annually, after Canada, to the United States.” So if the US had to pay the Saudis in gold-backed yuan I can see a big problem!
good legwork Mark! They are, they would prefer yuan, and there will be.
Here are comments from Zhou Xiaochuan, Governor of the People’s Bank of China, on the opening of the SGE International Board, delivered last week.
“The period starting from today and onward into the foreseeable future will be critical to Shanghai Gold Exchange in
implementing its accelerated and strategic growth and making an impact on the global stage.”
COMEX will become irrelevant.
The scales have always been a symbol of the money changers. What we see here is not just the lack of a white horse, but the end of a black horseman carrying scales…
The end of the middle class.
The end of a paradigm.
at the end of an age.
a return to subsistence wages… and masters.
The Pale green horse is next.
A pity, most do not have eyes that see.
Whether you wish it or not, may God’s blessing be on your house.
thank you very much Piper, U2.
As to your statement:
‘Please understand how the elites work, it is considered very bad etiquette if you do not warn your “marks” ahead of time.’
IMF Admits QE Encourages Excessive Risk-Taking; Warns “Sharp Downside Risks Are Rising”
yes, they have warned us.