This morning, I was as fired up as I can remember to write; as per today’s title, I can’t recall a more ominous set of geopolitical, economic and social circumstances in my life. Sure, for a few months in late 2008 and early 2009, it appeared the world was coming to an end – which for many, it financially did. Unfortunately history’s largest Ponzi scheme has since expanded parabolic ally as an unprecedented combination of money printing, market manipulation and propaganda has accomplished nothing but further impoverishment of “the 99%,” insolvency of the global banking system and acceleration of the inevitable end game of fiat currency collapse.
And thus, for those that actually believe a higher stock market created solely by government money printing and surreptitious buying has “improved” the situation, consider this week’s Rutgers survey – in which just 8% of Americans consider the economy excellent or good and only 7% claim higher earnings than 2008. In other words, the economic situation – and particularly, the outlook for U.S. dollar hegemony – is in actuality dramatically worse; and based on the ceaseless fountain of devastating “horrible headlines,” I am more fearful today than at the height of the 2008 crisis. Of course, back then I held less than 10% of my liquid net worth in physical gold and silver (with the remainder in 90% mining shares); whereas today, I feel far safer, knowing 100% of my liquid net worth is held as real money.
Zero Hedge said it best yesterday, when it wrote “everyone’s fighting the Fed now.” Not in equities, where freshly printed money is deployed by the President’s Working Group on Financial Markets to propagandize “recovery,” but the sovereign bond market where the “most damning proof yet of QE failure” – i.e., plunging rates despite “recovery” – is front and center. “Token hawk” James Bullard of the St. Louis Fed continues to beg investors to sell Treasuries. However, as the Miles Franklin Blog correctly predicted, the market doesn’t believe QE will ever end; let alone, the comical premise that the custodian of history’s largest debt load would even dream of raising rates. And as for the former, don’t forget that what the Fed says and does are entirely different things. Its goal is solely to protect the interests of the banks that own it – and overtly or covertly, will do anything and everything – legal and illegal – to do so.
Regarding the latter, Zero Hedge gets double kudos for yesterday’s description of what we’ve long described as the “hail mary” algorithm averring “confidence in central planning” was “saved by a last second stock ramp” – whilst the Cartel did what it’s done for the past decade, pushing GLD into the red in the last minutes of NYSE trading, after having defended its 200 DMA of $1,285 all day.
Which by the way, has been soundly surpassed this morning – before the day’s second “Cartel Herald” algorithm, just after the COMEX open when gold rose to exactly its 1.0% “upside cap” – and interest rates plunged to new 16-month lows, barely above the 2.31% level reached at the height of last week’s “manipulative day of infamy – and failure,” when World War III was on the verge of commencing following the supposed Ukrainian convoy attack. And the scariest part of it all is that in the past week, the most rapid Treasury yield plunges have come immediately after “island of lies” economic data, like this morning’s comical “upward revision” of 2Q GDP growth from the fictitious “4% world” to 4.2%. Yes, that massive plunge below at 8:30 AM EST resulted from the world laughing at government propaganda of 4.2% growth – when in actuality, the real figure is closer to negative 4%.
And not only is the world’s most important interest rate in FREEFALL – mark our words, to below 1% before hyperinflation inevitably arrives – but the yield curve is flattening in unprecedented manner. In other words, rates ranging from T-bills to 30 year bonds are collapsing in tandem and doing so globally. Frankly, I cannot conceive a more ominous scenario, as the entire world anticipates a money printing explosion of epic proportions. To wit, German three-year yields have turned negative, whilst 10-year bunds are below 0.9%, and Japanese 10-year bonds below 0.5%. Soon, every major bond market will approach the zero bound, as the terminal phase of history’s largest Ponzi scheme experiences the financial equivalent of the tide receding before a catastrophic tsunami of hyperinflation. This has been the fate of all 600 previous fiat currency experiments; but this time, said experiment has been conducted globally, with nearly all Western gold reserves surreptitiously leased to Points East. As they say, the “bigger they come, the harder they fall”; and no currency has been artificially inflated more than the dollar, with the Euro, Yen and Pound in a dogfight for second place.
All around us we are experiencing political and economic insanity. Regarding the former, the U.S. is front and center in inciting a new Cold War attacking every major oil producer imaginable, and even alienating allies by spying on their leaders, fining their banks, and threatening sanctions to anyone not adhering to our every whim. And worse yet, we are doing so from the unenviable position as world’s largest creditor sporting a hollowed out economy, insolvent banking system and universal popular mistrust. Consequently, the powerful Sino-Russian led “de-dollarization” movement is advancing in leaps and bounds – as exemplified by Gazprom, one of the world’s largest energy producers no longer accepting dollars as of today.
Economically, the world is in FREEFALL – as frankly, there is no word we can conceive to properly describe it. The “Land of the Setting Sun” is permanently receding into its “demographic hell,” which will shortly be shared by all leading Western nations. In fact, we expect historians to be shocked as to how rapidly Japan falls from grace, eventually becoming yet another Chinese pawn. China itself – the “world’s growth engine” – is amidst the early stages of history’s largest bubble implosion. And thus, the entire global economy will be crippled for years to come; after which, China will arise from the ashes as the undisputed superpower, given its massive manufacturing market share, enormous gold reserves and soon-to-be-well-understood military might.
As for Europe, we would be equally shocked if the inevitable dissolution of the EU and Euro currency don’t cause history’s bloodiest continent to revert to its time-honored ways; ironically, with Germany emerging as the most powerful nation. If Germany wisely commits its future to the rising BRICS contingent, it will likely become one of the world’s most powerful nations. But if not, don’t be surprised if history repeats itself, a la the 1910s and 1940s. Economically speaking, Europe is on the verge of collapse – and if yesterday’s news that the French cabinet was dissolved on the same day joblessness hit an all-time high was not enough to convince you, just wait until the ECB announces all-out QE in the coming months – potentially, as soon as next Thursday’s meeting which we’ll speak of at length early next week.
In a nutshell, the “pink elephant” that shocks us most is that anyone – agenda or otherwise – could believe the U.S. economy capable of “recovering” amidst a global economic collapse. For the moment, let’s ignore the aforementioned “island of lies”; as clearly, every conceivable measure of real income, employment, purchasing power and financial strength connotes recession at best – and more realistically, depression. In other words, even if one were to believe the possibility of “recovery,” exactly where would said growth come from? It is a universally understood fact that U.S. consumer demand is at post-2008 lows – as is corporate investment, real employment and foreign demand (recall, Caterpillar’s 20 straight quarters of revenue contraction). One might answer “more money printing,” but even that doesn’t hold water, as it is proven that incremental money printing is not improving real economic output. In other words, one must be a magician to even come up with an explanation; and at some point, even the best magicians’ deceptions are found out.
We believe that time is NOW; as with the “propaganda leg” of the “evil tripod of deception” broken and the “market manipulation leg” shattering amidst collapsing Treasury yields, it won’t be long before an unprecedented dose of the “money printing leg” destroys said “perception stool” completely. And when it does, the gold Cartel will be as relevant as the London Gold Pool in 1969 and all other failed attempts to suppress real money. But more importantly, the world will be a far scarier place – and if you haven’t taken steps to protect yourself from what might be, you and yours will have a far lesser potential for survival. We can only plead with you to be prudent – and if you’d rather be one of the “future 1%” than the future 99%, we hope you’ll give Miles Franklin the opportunity to earn your business.