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Today I want to discuss my polar opposite – i.e. the Joker to my Batman, Bizarro to my Superman, and Darth Vader to my Luke Skywalker – the MAINSTREAM.

One could write an entire thesis on the psychological reasons behind its formation – and some probably have – as human nature is as complex as it is wondrous.  We know man is not a race of loners, like polar bears, or pack animals, like wolves, so what exactly is homo sapiens’ true social construct?

The answer lies somewhere in between, with both nature and nurture playing significant behavioral roles, never to be truly defined.  Moreover, beyond simple biological dispositions, the question is more puzzling still, particularly as relates to the “consensus,” or as Irving Janis would say “groupthink,” per below.
Groupthink is a concept identified by Irving Janis referring to faulty decision-making within a group. Groups experiencing groupthink do not consider all alternatives, desiring unanimity at the expense of quality decisions.  
The “consensus” and “groupthink” are obviously two things, as groupthink implies the consensus is always wrong, which is obviously not the case.  That said, it quite often is, and given that I spent two decades as an equity analyst, I know a thing or two about “consensus estimates” and how often they are wrong.

Excluding the noise of public or private guidance from insiders, the Wall Street consensus is more often wrong than right, regarding industries, trends, and specific companies.  The most inviolate rule of financial prognostication is “past is not prologue,” yet this truism is violated more than any other in the field.

Mankind – in this field, “financial analysts” – reacts more to inertia than logic, explaining why equity investors lose money over time, counter-intuitively “buying high” and “selling low.”  The fact that markets are manipulated – particularly gold and silver, wherein the Cartel orchestrates false technical signals – makes success more difficult, particularly when “commentators” are either biased or themselves affected by PROPAGANDA.  This is the nature of financial markets, where no level of informational transparency – even the internet – is enough to overcome basic human bias, particularly when the playing field is neither level nor fair.

As for the Precious Metals markets – or more properly put, foreign exchange as gold and silver are not “investments” but “money” – no sector has been so prone to such a plethora of illicit, mind-altering influences throughout HISTORY.  And not just today, as Precious Metals have competed with the selfish desires of politicians and bankers for centuries, in each instance demonized as “barbarous relics” by the handful of elites seeking to PROFIT and RULE at the expense of the masses.

Be it FDR’s gold confiscation decree of 1933, partial gold standard abandonment at Bretton Woods in 1944, collapse of the London Gold Pool in 1968, full abandonment by Nixon in 1971, the Hunt Brothers fiasco of 1980, or the past decade’s Cartel manipulation, the episodes of gold demonization, manipulation, and even fabrication (GLD, anyone?) are as numerous as the myriad fiat currencies that collapsed in fighting it.  And that’s just the financial end of it.

More damaging than the market suppression schemes has been PROPAGANDA, as billions of people desperate to “fit in” have listened to siren calls of their leaders regarding the “free lunch” afforded by un-backed money.  In fact, TPTB have done such a great job exploiting modern technology – such as electronic banking, computer trading, data massaging, and mass media – that recent generations, particularly in “newer cultures” such as America, have no understanding of the difference between CURRENCY and MONEY.  Hence, when it comes to the “consensus” about gold and silver, many have no opinion at all, while the majority that do have a negative view, such as it being a “barbarous relic” or “risky investment.”

Hence, the beauty of our position as “the 1%” enlightened of the aforementioned, fully cognizant of Precious Metals’ historical role as money, as well as fiat currencies’ deplorable track record of 100% failure.  Just knowing PMs are not “investments” but “savings” is enough to “beat the consensus,” which unfortunately will not “get it” until it is too late.  Of course, in today’s banker-destroyed world, few people even have the means to buy gold and silver even when they do understand, and these people are the most dangerous liars, as they WANT gold to fail out of jealousy.

Financial institutions are historically conservative in their investments, and TBTF criminals like JP Morgan and Goldman Sachs don’t count, as they are no longer independent entities but government adjuncts, in many ways controlling it more than the politicians themselves.  However, small banks, insurance companies, pensions, investment clubs, and non-profit organizations are motivated by risk/reward, and WILL alter their portfolio allocations as the zeitgeist changes.  AS WILL INDIVIDUALS!

Jim Sinclair, also known as “Mr. Gold” and perhaps the most influential person of my entire business career, last month gave an interview that inspired this RANT, per the link below.

Sinclair – Mainstream Entities Will Now Enter Gold Market

In it, he made the following prognostications, which I believe will occur THIS YEAR, signaling the launch of the inevitable mania stage.  This phase will be characterized as much by FEAR – likely, more so – than GREED, culminating in the COLLAPSE of the Cartel and, more importantly, the GLOBAL FINANCIAL SYSTEM.
I predict you are going to see a new definition of gold investors that, until now, haven’t been considered.  Until now, the retail crowd and international central banks have been the primary entities in gold….
…but you’ve never had mainstream investment, mainstream pensions, mainstream life insurance companies, mainstream health plans, which gather money and seek vehicles to maintain its buying power.  This is a huge change, huge new demand, a totally new definition…
…you’re going to find that public companies with significant resources – tech companies, for example – will recognize that gold is an important part of protecting what they have.  So I think you’ve identified a game-changer for corporate America and corporate global Western finance, to begin to look at gold as an alternative to the normal cash and debt instruments they would use to hedge themselves.
Propaganda, market manipulation, and data obfuscation will continue until the bitter end, just as it did in Ancient Greece, John Law’s France, Weimar Germany, and modern Zimbabwe, but will be overrun by REALITY.  Thus, only a handful of outliers from our “shadow world” will profit from owning Precious Metals – let alone protect their assets – as the custodians of the University of Texas’ endowment fund did last year.

University of Texas’s Gold Buy Is a Game-Changer

Sadly, when mass realization finally occurs that gold and silver are MONEY – and “dollars” and “Euros” WORTHLESS – it will be too late to act.  At least the MAINSTREAM will finally be correct, for what it’s worth.