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Looking back on the upcoming economic, financial and social crime wrought by the collapse of history’s largest Ponzi scheme – perhaps, in the not so distant future – 99% of the world’s population will be kicking itself.  True, some are educated enough to understand the tragic history of fiat currency, whilst countless others have been “propagandized” otherwise.  And most importantly, most of “the 99%” don’t have the means to protect themselves irrespective; and thus, fall back on human nature’s oldest defense mechanism – denial.  Well, that and the exploding government entitlements necessitated by imploding economic activity.

Thankfully, the internet is enabling more and more people to learn the truth.  However, things are getting so bad, one doesn’t need to read about it to understand.  The average person is struggling to survive, no matter where he or she lives, as the lethal combination of inflation and unemployment sweeps the globe like the Ebola virus.  And worse yet, the “1%” receiving free printed money has never been richer, yielding a wealth gap reminiscent of feudal times.  To lend some historical perspective, I’m currently reading New York by Edward Rutherford, of what Manhattan was like just before the American Revolution in the 1760s.

Back then, amidst an extremely powerful recession, landowners were freeing slaves because they couldn’t afford to feed them.  However, with the streets chock full of beggars and vagrants, British lords lived across town in mansions with not a care in the world.  Such an unsustainable societal divergence yielded revolution; and today, with an additional 6.5 billion people, it terrifies me to consider what the coming years hold.  Reading “top story” MSM headlines like the one below, one realizes just how close we are to “the big one”; and consequently, why your “last chance for financial salvation” is staring you in the face.


Yes, shares are up because the economy is falling.  Well, that and the fact that Central banks are no longer simply printing money, but injecting it directly and indirectly into financial markets.  This is why stocks and bonds are at all-time high valuations, amidst the worst economic fundamentals in generations; and why, if you don’t take heed of the lessons of history, you may never have a chance to preserve your hard-earned capital.

This morning alone, European GDP was reported as flat for the second quarter – including unexpected negative prints for Germany and Italy, and a dramatic reduction in second half expectations.  Real activity was far weaker than the massaged numbers, as they now including non-productive (and illegal) activities such as drug-dealing and prostitutions; let alone, the comical “deflation” assumed by the continent’s monetary masters.  Worse yet, such weakness occurred before Germany’s biblical July and August business sentiment collapses, making it highly possible Europe remains in recession for the entirety of 2014.  But don’t worry, as European stock prices are higher this morning, while the benchmark 10-year German Bond yield fell below 1.0%, enabling the “1%” of the population owning large positions in government-supported stocks and sovereign bonds to get richer, whilst the “99%” gets poorer.  And by the way, recall how we wrote yesterday of our incredulity regarding relentless propaganda of the UK economy’s “strength,” despite consensus expectations it will only grow 0.7% in the second half of the year.  Well, what a shock, the Bank of England reversed its “relatively hawkish” stance yesterday afternoon, stating rate increases are no longer a near-term priority, citing the same “significant underutilization of labor resources” averred by the Fed last month.  And for the icing on the cake, Europe’s economy is so weak, Spain’s government is lobbying the EU for reimbursement of a measly $800 million of economic losses incurred due to the EU’s actions in sanctioning Russia!  Yes, it’s “decision time” for the ECB as it “prepares” its inevitable massive QE launch.

Speaking of plunging interest rates, even the Fed’s newest market manipulation, the “new hail mary trade” – i.e., goosing the 10-year Treasury yield to prevent realization of the “most damning evidence yet of QE failure” – is failing miserably.  Here at the Miles Franklin Blog, we have said this would happen for some time; and this morning’s plunge below the key round number of 2.4% is yet another ugly milestone en route to ZERO – and with it, “QE to Infinity.”  This morning’s news of a dramatic decline in Walmart’s earnings guidance – ominously, blamed on Obamacare – was the straw that broke the camel’s back, following yesterday’s similarly awful news from retail bellwether Macy’s, as well as that overall U.S. retail sales were flat in July.  Well, “flat” unless you use real numbers, as John Williams of Shadow Stats does.

– Headline Retail Sales boosted to “Unchanged” by downside Prior-Period revisions
– Net of Inflation, Real July Sales likely fell for Second Month
– Real July Sales were Below Second-Quarter Average 

Shadowstats.com, August 13, 2014

And by the way, lest anyone still wants to drink the Wall Street, Washington and MSM “recovery” Kool-Aid, try this sobering chart for size – which doesn’t yet include Walmart’s guidance that 2014 EPS could fall as low as $4.90.

Zero Hedge

Yes, the “1%” are getting richer, and the “99%” poorer.  And no better way to portray this ugly, unsustainable situation than last night’s Cisco earnings statement.  While warning that global earnings are likely to remain weak indefinitely, and firing 6,000 employees (8% of its workforce) it announced a new $1.5 billion stock buyback.  Care of the Fed’s suicidal pyramid-building ZIRP policy, Cisco has borrowed $8 billion in the past three years, enabling the repurchase of $22 billion of “1%” supporting shares, whilst firing 21,000 “99%” workers!

Yes, when unfettered monetization is yielding record profits for “1%” stock and bond holders, at the expense of the “99%,” you know your “last chance for financial survival” is beckoning.  Heck, I just read that 20 of America’s most profitable companies – including “Government Motors” itself – don’t pay taxes; yet again, sticking the “1% with the bill.  And if you really want to gasp in incredulity, read this David Stockman article of how the worst 2007-style financial derivatives products, issued by high finance’s worst villains, have re-entered the scene!  No, no bubble here.

Zero Hedge

Zero Hedge

Rarely is the public warned so loudly and clearly, that their life’s saving are about to be evaporated and/or stolen.  And rarer still is the unique situation we are faced with today; wherein, the only certain ways to protect oneself – i.e., physical gold and silver have been temporarily “priced” below the cost of production, despite looming shortages and record global demand.  To drive home the point, we’ll simply pass along two quotes from the past 24 hours; first, from Federal Reserve Vice-Chairman Stanley Fisher…

The United States is preparing a proposal to require systemically important banks to issue bail-inable long-term debt that will enable insolvent banks to recapitalize themselves in resolution without calling on government funding.

Smaulgld.com, August 12, 2014

…and the second from Vladimir Putin, who probably hates America, and exports nearly as much oil as Saudi Arabia…

Russia should aim to sell oil and gas for rubles globally, as dollar monopoly in energy trade is damaging economy.

UK.Reuters.com, August 14, 2014

This is your “last chance for financial salvation,” and we pray you take it.  And if you do, we at Miles Franklin ask you to call us at 800-822-8080, and give us a chance to earn your business.  We expend a tremendous amount of resources putting together this educational blog and newsletter; and based on the sterling reputation garnered in 25 years of honest business, plus the world’s finest international storage program, we believe we can handle all your precious metals needs with the industry’s finest service!