Before I go over today’s Cartel capping job – er, “market activity,” – let’s start with an article that popped up on Zero Hedge this afternoon, to which I respond – DUH!
“Helicopter Ben” symbolizes why we own physical gold and silver, but is just a figurehead in the TPTB’s battle against REAL MONEY. Power hungry, status quo seeking governments have fought the MONEY PRINTING constraints of gold and silver standards for centuries, and “independent” or not, Bernanke is just another government employee. Do you think it’s a coincidence the Fed “unexpectedly” became more dovish the day after Obama’s SOTU speech, for all intents and purposes kicking off his re-election campaign with a monetary bang? If so, think again.
Benny may be the current Fed Chairman, but Greenspan and others before him kowtowed to the political establishment in like manner, as ordered by both “conservatives” such as Nixon, Reagan, and Bush, and “liberals” like Johnson, Clinton, and Obama. And don’t forget the Central Bankers in Europe, Japan, China, and numerous other nations, as well as “powerbrokers” such as George Soros with both political influence and a sociopathic lack of consideration for human rights.
Of equal importance, the full interview with “ADMIRAL SPROTT,” published this morning with Eric King, a must listen piece.
In it, several very important tidbits emerged, the first that a producing silver miner participated in last week’s PSLV offering, demonstrating that ADMIRAL SPROTT’S “Call to Action” initiative two months ago is bearing fruit.
Not only that, he disclosed that Endeavour Silver, a high-quality mid-tier producer, agreed to hold back two-thirds of its December quarter production, citing Sprott’s advice to hold out for higher, NON-MANIPULATED prices, detailed further in the article below.
I view these two events as HUGE news, indicating a handful of savvy, shareholder-friendly mining executives are starting to understand the manipulation and fight back. Until recently, I had NEVER heard of a mining company responding to manipulation, the most important factor in its business, but obviously the firm that participated in the PSLV offering, Endeavour Silver, and others such as First Majestic Silver are starting to get it.
The last time a public miner of ANY KIND withheld production was the early 2000s, when Rob McEwen was still running Goldcorp, per this quote from an old interview I dug up:
In 2001, when gold was $270/oz, at Goldcorp we started to withhold part of our gold production. The reasons were threefold; one, I believed the gold price was going much higher, two, there were tax advantages to selling it several years later and three, we increased our financial assets by holding back the gold. Several years after we started we had more gold in our bank vaults than half the central banks in the world.
When Goldcorp merged with Wheaton River resources (from whence Silver Wheaton was eventually born) in 2005, Wheaton River’s Ian Telfer became Goldcorp’s CEO, paving the way out for McEwen to explore other ventures, which ultimately were U.S. Gold, Minera Andes, and VG Gold. Once McEwen – one of the industry’s true “mavericks” – left, it was back to “business as usual” at Goldcorp, i.e. selling gold at depressed prices and thus harming shareholders.
In my view, the aforementioned “silver investments” by producing miners are potential game changers in the war against Cartel PAPER silver suppression. Not only that, they are likely the “tip of the iceberg” in a broader trend of “mainstream entities” entering the PM market, per the timely comments made yesterday by “Mr. Gold,” Jim Sinclair. Obviously silver miners are the most likely starting point for corporations investing in PHYSICAL silver, but ultimately Sinclair expects corporations of all types to purchase Precious Metals, as well as individuals, endowment funds, and municipalities. It looks like a few more people, and entities, may PROTECT THEMSELVES after all!
And one final point from Sprott’s interview that I wanted to mention, regarding Chinese gold imports EXPLODING in late 2011. Per the chart below, Chinese gold imports were a staggering 102 tonnes in November alone, or HALF THE WORLD’S PRODUCTION, not including Chinese gold production, which is entirely consumed by its government.
Such meteoric demand growth gibes with last week’s comments from the notoriously prescient “London Gold Trader.” After reading his commentary for the past five-plus years, I am quite positive he is intimately plugged in to the Chinese government.
Clearly the Cartel is being “taken on” by the Chinese government and other, GLOBAL buyers of PHYSICAL gold – such as the Russians and Arabs – which should tell you just how much naked shorted PAPER gold has entered the market since “OPERATION PM ANNIHILATION II” commenced on December 8th. Just six weeks later, silver is ABOVE its “pre-OPMA II” price, and gold just $20 away from that level.
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Friday morning, and what a week it has been! A HISTORIC Fed capitulation, MASSIVE debt ceiling increase, FAILED “COMEX OPEX” gold attacks, and now a MISERABLE GDP report. Given the cheerleading Fed was forced to dramatically reduce its GDP forecast just two days ago, one would think such atrocious results wouldn’t be “unexpected.” Unfortunately, the “financial industry” is now populated by dolts, who long ago lost critical brain functions after years of being spoilt with artificially low interest rates, upwardly manipulated data, and of course, bailouts any time they are wrong, i.e. ALWAYS.
While at the gym this morning, I noted the incredible calm resulting from the past two month’s market LOCKDOWN by TPTB, yet another contributor to the aforementioned destruction of critical neural paths. I then pondered an interview last night with Ann and Nancy Wilson of Heart, perhaps the greatest female rock stars ever, recalling the making of their hit album, Dreamboat Annie, in the 1970s. The Vietnam War horrors inspired their music, and to this day brings tears to their eyes. Unfortunately, such emotion no longer exists in America, as citizens could not care less about dying soldiers, moral turpitude, and wasted time and money. Instead, they borrow PRINTED MONEY to buy $600 iPhones, watch reality television, and ignore true reality, such as the onset of World War III being discussed, as I write, by the world’s “elites” at Davos, Switzerland.
They ignore the impending default of the ENTIRE European Continent…
…the world’s third largest economy…
…and, of course, the first largest…
…while continuing to re-elect the hypocrites that endorse such profligate spending, but then pretend to care in election years…
…and hoping the impossible becomes possible, such as the funding of pension plans assuming 7.5% long-term annual returns when the Fed has pledged ZIRP until “at least 2015.”
Running on the stair climber, I thought of the great line from Titanic, “waiting for an absolution that would never come,” which describes the situation perfectly. Sorry America, Europe, Japan, and most of the U.S. dollar-enslaved world, absolution is impossible. The mathematical certainty of currency collapse is undisputed, just as was the certainty Titanic would sink once five of the 16 compartments filled with water.
Back to the markets, it looks like even the PPT is having trouble keeping them afloat after such a turd of an “unexpected” GDP disaster, but then again it’s early. Gold flat-lined all night, again resisting all attempts to push it down, even at 3:00 AM EST. As you can see below, the Cartel attempted to push gold down the second the gold-positive GDP report emerged, but for naught as it raced back up, pushing towards $1,730/oz as the power of hyperinflation fears start to seep into investor minds the world over.
Let’s see what 12:00 PM EST, the “cap of last resort” has to offer, as thus far the first three KEY ATTACK TIMES have miserably failed. Remember, the Cartel’s biggest nightmare is soaring gold and plunging stock prices, as occurred in both February 2009 and August 2011, before they redoubled their manipulative PAPER shorting efforts, of course. Once you see such a divergence re-emerge, you will know TPTB are being seriously challenged by MAJOR, GLOBAL PM BUYERS.
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SOLID…AS A ROCK
In today’s increasingly cut-throat, financially deteriorating, morally depraved world, nothing makes me smile more than art forms that emanate goodness, selflessness, and sheer joy in the art of performing for others. Particularly given that my job and passion relates to uncovering the opposite, I feel a particular affinity to such innocence, which I am fortunate enough to see daily when my wife joyfully sojourns to teach ballet.
Some of my favorite “kitsch” is 1980s R&B music, and none depicts this artistic sunshine like Ashford and Simpson, who performed together as husband and wife for more than 35 years before Ashford’s unfortunate death last year at the age of 70. They were most accomplished as songwriters (they wrote the Supremes’ “Ain’t no Mountain High Enough” and Chaka Khan’s “I’m Every Woman”), but most famous for the hit 1984 single “Solid as a Rock.”
This video, filmed in Central Park – near Valerie Simpson’s Bronx roots – is one of my favorites. The couple was happy their entire lives, and emanated every ounce of their lust for life, and each other, in this song. And not only that, espoused a theme that would later be the mantra of Precious Metals investors throughout the most difficult financial crisis in modern history.
The past decade marked the end of a Golden Age for the Western world, the brief period between the commencement of the “fiat standard” in 1971 and the point when the limitless DEBT it engendered lost its marginal productivity, per my January 20th RANT, DIMINISHING RETURNS. In other words, there was nothing “golden” about it all, simply a period when cumulative debt – on the individual, corporate, municipal, and sovereign levels – was low enough that it appeared to serve a beneficial role to society. Ah, the early siren song of fiat currency!
This is the problem with experimenting with fire, as the WORLD had never attempted a global fiat standard in which ALL currencies were backed by nothing except the “full faith and credit” of banker-operated governments. Nearly everything is OK in moderation – including debt – but breaking the bond with gold gave such governments the green light to PRINT as much money as they desired, for earmarks, welfare, and campaign promises. And if there’s one thing I have learned in life, “free lunches” will ALWAYS be accepted when “the going is good.”
To the contrary, it wasn’t “good” at all, but bad, very bad. It is hard to believe the ENTIRE WORLD went from fiscally sound to cumulatively bankrupt in just four decades – with most of the damage done in the last ten years – but it has, the ultimate testament to the selfish, self-destructive core of HUMAN NATURE. Consequently, the global of standard of living, particularly in the Western world, will decline for decades to come, with financial pain, political turmoil, and social unrest the ultimate result.
The nostalgia of timeless art, such as that produced by Ashford & Simpson, will be all many have to cling to, as the ravages of hyperinflation will make life extremely difficult, and in many cases, endangered. I do not venture to say owning PHYSICAL gold and silver is a panacea to what ails the world, but I do know ownership will make your finances – and state of mind – SOLID…AS A ROCK.