It’s still Monday evening, and I figured I’d write a few thoughts before watching my favorite show, The Good Wife. If you missed it yesterday, below is a link to my weekly podcast with Kerry Lutz of the Financial Survival Network. Kerry and I are both skeptical New Yorkers, so I thoroughly enjoy our 20 minute spots each week.
Andy Hoffman Weekly Podcast with Kerry Lutz, Financial Survival Network
In yesterday’s RANT, “PSLV PREMIUM SURGES TO 31%,” I highlighted how Eric Sprott’s closed-endsilver bullion fund is trading at an enormous premium to its NAV, which yesterday blew out further, closing at a RECORD HIGH of 33.4%. One can never know EXACTLY what is going on behind the scenes, but my best guess is big money is becoming worried about sourcing large blocks of silver, and thus buying PSLV to ensure their ability to obtain PHYSICAL in the future, particularly if the fund does a follow-up offering to increase its size.
It is estimated that less than one billion ounces of above ground silver exists, most of which is not for sale at current prices, if ever. PSLV own 22 million ounces, or 2.2% of the world’s silver assuming the high-end estimate of one billion ounces, and has an outstanding shelf offering of $1.5 billion, which at current prices (assuming the silver is available) could buy another 50 million ounces or so, or 5.0% more. As I noted yesterday, Eric Sprott is the global leader of the “break the Cartel” movement, so do not be surprised by ANYTHING this very powerful man does in this pursuit.
Meanwhile, as claims to the limited PHYSICAL silver on Earth were being purchased hand over fist via PSLV, the Cartel was attacking all day. Despite gold falling just $7/oz from its Friday close, it demonstrated ALL its daily attack patterns. Recall from previous RANTS that the newest KEY ROUND NUMBER is not a fixed number at all, but gold’s 200 DMA, currently sitting at $1,627/oz. It couldn’t be more obvious the Cartel is sitting on this level, per gold being stopped cold on both Thursday and Friday at exactly this level.
Not only that, Thursdays “200 DMA caps” occurred at EXACTLY 3:00 AM EST and EXACTLY the PM fix at 10:00 AM, while Friday’s “200 DMA cap” occurred at EXACTLY 3:00 AM, right on the Cartel’s increasingly predictable schedule (see below).
Thus, it should be no surprise that gold rose ALL NIGHT in Asia (aside from the typical excitement-sapping attack at the open) until EXACTLY 3:00 AM EST Monday morning, just as it once again attempted to breach the 200 DMA (see green line below). After that, the Cartel broke some of its most infamous records, such as an incredible seven WATERFALL DECLINES, the worst coming at EXACTLY the PM FIX at 10:00 AM EST when gold again attempted to take out its 200 DMA.
Keep in mind that no other markets moved materially ALL DAY, with the Dow trading in a tight 20 point range from open to close. The entire ALGORITHM playbook was in use today, including the Dow / HUI x 2 program that allows the HUI to rise ONLY when the Dow is rising, but at half the rate, while plunging at twice the rate when the Dow declines.
Meanwhile, Italian bonds weakened considerably throughout the trading day, nearly reaching the ALL-TIME HIGH spreads to German Bunds reached this Fall, while that dying nation’s largest bank, Unicredit, was halted a record EIGHT TIMES before ending the day 43% lower, en route to ZERO!
Italian Bonds Surge To Early November Wides
Of course, the U.S. markets NO LONGER EXIST because participants long ago deserted due to the domination of GOVERNMENT COMPUTER ALGORITHMS, so it becomes easy to see how even worldwide bellwetherslike the Dow Jones Industrial Average have become 100% irrelevant as price-setting, predictive mechanisms. Right now, the stock market is 100% controlled by the PPT, the most important piece in its global propaganda strategy.
Lowest Volume Of The Year As Stocks Inch Higher
Speaking of the Cartel, how about this amazing quote from Paul Craig Roberts, U.S. Assistant Treasury Secretary in 1981-82? In the new issue of Gerald Celente’s Trends Journal, an article by Dr. Roberts is featured, and if ANYONE knows about government gold price suppression, it would be Treasury Department officials from the early 1980s, when the Cartel attacked PAPER PM prices to knock them down from their 1980 fear-driven highs. The article refers to TODAY’s markets, in which the government is illegally suppressing gold and silver prices to create PERCEPTION that inflation is under control.
If this is the path that Washington is stumbling down, the government will continue to intervene in bullion markets in order to take the steam out of run-ups in the prices of gold and silver, thereby preventing the build-up of momentum that would ultimately result in a flight from paper currency.
And following up on yesterday’s article about a Dutch official admitting 90% of the nation’s 613 tonnes of gold reserves are stored offshore, a movement has already developed to pressure its government to repatriate that gold. Remember the drama about Venezuela’s 372 tonnes being repatriated? Well, what will happen if the Netherlands have trouble getting their 613 tonnes back?
Netherlands Urged to Repatriate Gold Reserves
While on the topic of gold manipulation, it looks like JP Morgan’s Bill Daley is out after just a year of being Obama’s Chief of Staff. Daley follows the two-year reign of Goldman Sach’s Rahm Emmanuel, and take a guess where the NEW Chief of Staff, Jacob Lew, was recruited from – none other than the world’s WORST company – after General Motors – CITIBANK! In days of yore, I’d attach some kind of significant to cabinet departures, but not anymore. As the U.S.S. Titanic has plunged deeper into the abyss, cabinet members in the Bush and Obama administrations have jumped ship at record rates. Why work in a thankless, useless, worthless, hopeless government position when you can make more money stealing from the public as a banker?
Bill Daley Barely Lasts One Year Under Obama
And finally, while still in the PM realm, I want to publish this fantastic graph of the ratio of the XAU gold mining index to the price of gold over the past 27 years. As you know, I pay no attention to short-term charts in a rigged market like PMs. However, long-term charts must be heeded, and this one shows a massive breakdown of this ratio three years ago that miserably failed to recapture support twice. Past is NEVER prologue, but given the heightened risks I anticipate in the mining business, I would be VERY wary of this bearish trend in gold and silver mining stocks.
Tuesday morning, and for once PMs had an uninterrupted rise all night, even at the COMEX opening. It’s no coincidence gold is up 1.85%, comfortably below the Cartel’s 2.0% daily cap level that has held for 99% of ALL TRADING DAYS over the 12 year bull market, but I won’t complain, as it has finally retaken the 200 DMA. The concept of gold falling below such staunch technical support for the first time since the BOTTOM of Global Meltdown I in late 2008 demonstrates the intensity of “OPERATION PM ANNIHILATION II,” commencing on December 8th with the now infamous “gold sale headline.”
Not only has gold recouped the 200 DMA of $1,627/oz after Cartel attempts to stop it on each of the past four days, but silver surged 4% to comfortably re-take the $30/oz level, making it increasingly likely that the $26-$30/oz level will become a MAJOR, likely UNBREAKABLE support level in the coming months. Nothing is set in stone, but given the raging fundamentals, technical support, and EXPLOSIVE surge in the PSLV premium, it is hard to believe there is significant downside here. In fact, as was the case in November 2010, when a $575 million PSLV stock offering served as not only the catalyst for silver’s April 2011 surge to $50/oz, but the commencement of “D-DAY” suppression operations, my “spider sense” tells me that the angry, powerful, financially militant Eric Sprott may again be positioned to lead a second charge on $50/oz.
Actually, if you count the January 1980 intraday surge to $50/oz, ARTFICIALLY CAPPED by government attacks on the Hunt Brothers, and the April 2011 surge to $50/oz before the government attacked with the SUNDAY NIGHT PAPER SILVER MASSACRE (replete with fraudulent announcement of bin Laden capture), we are looking at the potential for the LARGEST TRIPLE-TOP BREAKOUT OF ALL TIME!
I am not kidding here, but dead serious. Silver has been artificially held below the ultimate KEY ROUND NUMBER of $50/oz for 32 YEARS, creating the most unwarranted, out-of-whack financial ratio in HISTORY, the ridiculous 54:1 gold/silver ratio. Silver is only produced at 9x the rate of gold, compared to the historical average of 16x, and nearly all the world’s silver has been consumed by industry. About five years ago, the U.S. Geologic Service (USGS) stated silver would be the first “extinct” element on the periodic table, not even considering its monetary aspects, which in my view will account for 90%+ of silver demand over the next decade. I believe the gold/silver ratio will ultimately fall below 15:1, and possibly 5:1 in the coming years.
Reading Gerald Celente’s new Trends Journal this morning made me ponder several disparate topics. For one, it validated the answers I have given to recent questions about potential “safe havens” for storing capital and/or inhabiting during times of heightened political and social instability. Some of the names he cited were New Zealand, Norway, Finland, Sweden, Canada, Australia, Costa Rica, and Andorra, and I’ll remind readers to perform careful due diligence on these and any other nations under consideration.
Secondly, he brought up a point I have discussed at length in recent weeks, the complete and utter apathy/lethargy/attention deficit of Western citizens and media outlets alike. I attribute this mental deficiency to numerous issues, including personal stress related to the expanding “inflationary depression,” a sense of hopelessness brought about by recent experience, an expanded “welfare society” in which more and more people dependon the government for survival, and a PTB propaganda campaign infiltrating all aspects of society, led, of course, by the takeover of financial markets by government rigging operatives such as the PPT (stocks), ESF (currencies), Cartel (PMs), and Fed (bonds).
The cumulative result of this misdirection campaign is turning off the public’s political and economic “radar,” and subsequently retreating into the mind-numbing world of reality television, texting, gossip columns, and violent movies and video games. Even I have started to ignore things I previously watched intently each day, such as fudged economic data and meaningless market indicators such as the Dow Jones Industrial Average and U.S. dollar index.
Due to this gradual dulling of the “cumulative public senses,” people no longer care when they see headlines such as the one below, clearly published as blatant rhetoric to support an imminent attack on Iran. After all, the International Atomic Energy Association was created by, and presumably still manipulated by, the United States, as is the case for other American creations masquerading as “international organizations,” such as the IMF, BIS, World Bank, NATO, and United Nations.
IAEA Confirms Iran Has Started 20% Uranium Enrichment
Next up, the “welfare society aspect,” in which people borrow seemingly limitless funds via government subsidies and promotions. Given that Fannie Mae and Freddie Mac are now the largest originators, employers, and likely owners, of U.S. residential real estate and related businesses, the government has no problem expanding the housing bubble infinitely, particularly in an election year. The fact that mortgage debt, but not real estate prices, is rising is immaterial so long as the government printing presses remain unchallenged. Hence, the necessity to suppress gold and silver prices.
Consumer Credit Jumps By Most In 10 Years On Surge In Car Loans
And, of course, sheer denial, as in “if a tree falls in the woods, I can’t hear it.” Well, sure we can’t hear trees falling in Ireland, but the Irish people can, as well as all nations entrenched in the failing European Currency Mechanism, which must consider whether to “bail out” Ireland and the rest of the PIFIGS. I am truly astonished to watch the carnage going on in Italian bonds and stocks, for example, while the rest of the financial world snoozes, particularly when it’s obvious ALL the PIFIGS face the same issues that were so fretted about just a few short months ago.
Buiter On Why Irish Eyes Demand A New Bailout
Heck, Greece is actually spending much of its scarce bailout capital on its MILITARY, watching its people starve while American and European military contractors receive large payments for useless tanks and planes. The last time the Greek army was a threat to ANYONE -even its own people – was when the year ended with B.C.!
Greece Spends Bailout Cash On European Military Purchases
Or how about the fact that, as of today, ALL of the €489 billion of FREE “LTRO” capital has been re-deposited into the ECB, quashing all hope of a multiplier effect and heightening fears of an imminent, permanent freeze-up of the interbank lending market. The €489 billion of LTRO funds represents MONEY PRINTING in its purest form, yet in less than a month has proven to be WORTHLESS for anything other than creating inflation.
Record ECB Deposit Soak Up Entire LTRO
Or how entire nations are going bankrupt, and out of sheer desperation no longer attempting to even disguise their precarious financial positions.
Hungary Folds, Ready To Change Its Laws To Get European Bailout Money
Meanwhile, in the U.S., the “land of green shoots of recovery,” no such recovery exists, nor has it ever. Fudging inflation, employment, and GDP figures to mask the ongoing economic contraction will NOT make things better, and continuing to PRINT MONEY will make things worse. With interest rates at all-time lows while international selling of U.S. Treasuries reaches all-time highs, it should be quite clear that QE not only never ended, but accelerated in recent months.
Not only that, the Fed itself could not be more vocal about its intentions to expand QE, and no doubt will OVERTLY admits to a formal “QE3” program in the near future. Despite Friday’s “better than expected” employment report, in and of itself a gigantic ruse, two Federal Reserve governors spoke of the need for additional stimulus just hours afterward, and another two repeated this mantra yesterday!
Fed may need to buy more bonds: Williams
Fed’s Lockhart does not rule out more easing
Meanwhile, China could not be clearer that it fears a major recession, publically promoting stock ownership to its citizens in an attempt to reverse the inexorable decline of the Shanghai Index as the Chinese economy sharply contracts. Desperation at its worst, albeit nothing compared to what they are likely to do in the name of “economic stimulation” in the coming months and years.
China Is Proud To Announce It Is Reflating The Bubble – Will “Actively Push” Investors Into Stocks
And before I get to my RANT topic, one final graphic to illustrate how dire the world’s financial situation has become. The figures on the left depict the world’s largest sovereign debt defaults over the past 30 years, led by the $82 billion Argentine default in 2001 and $79 billion Russian fiasco in 1998. After that, however, the next largest default was a measly $6 billion, and as you can see by the large bars on the right, even the smallest of the PIIGS, Ireland, has a debt load twice as large as ALL the 1983-2011 sovereign debt defaults combined.
Of course, the PIIGS are just five of perhaps 30 or more nations on the precipice of default, a “distinguished list” including the world’s largest debtors, including the U.S., U.K., Italy, France, and Germany.
Readers, simple math tells you ALL of these debts will be defaulted, either via reneging or inflation, and only by coming to this realization will you take steps to PROTECT YOURSELF from the inevitable financial catastrophe resulting from such.
Today’s topic will be somewhat lighter than usual, the logical result of Sunday’s inspirational win by my home town Denver Broncos over the heavily favored Pittsburgh Steelers. For non-Americans reading this RANT, the Broncos’ quarterback is perhaps the most controversial, polarizing figure in the history of football. Tim Tebow, devout Christian and model citizen, was one of the most successful college football players in history. His Florida Gators won the national championship twice, while he won a Heisman trophy and set all kinds of records with his ability to both run and pass.
However, that’s when his “golden era” peaked, as now it was time to consider the NFL, where rigid guidelines pigeon-holed his style as “unorthodox” and throwing motion elongated. Despite possession of a once-in-a-generation skill set, the so-called NFL “experts” unanimously agreed Tebow could not be successful. All of a sudden, his size was considered a liability, as were his running skills, while a silently, politically incorrect aversion to his sideline prayers portrayed him as a freak. The Denver Broncos surprisingly picked Tebow in the first round of the 2010 NFL draft, ultimately leading to the firing of its second-year coach, Josh McDaniels, as “fall guy” for such an unorthodox decision.
When Tebow was drafted, his jersey sold nationwide in record numbers, and to this day is the #1 selling jersey in the league (which no doubt will see an EXPLOSION of new orders after last week’s game). In other words, while the coaches universally panned him – except for lone-wolf McDaniels – the FANS loved him, and could not be more excited when the floundering Broncos finally made him their starter after a slow start, losing four of their first five games.
Lo and behold, the Broncos started winning. The wins were by “unorthodox means” featuring few passes and an inordinate amount of “quarterback sneaks,” but even with this well-telegraphed strategy, opposing teams were having trouble stopping Tebow. Much hype has been made of mobile quarterbacks such as Steve Young, Randall Cunningham, John Elway, and Michael Vick, but those four superstars were scramblers, not running backs. Tebow was beating teams not by being evasive, but intelligent and strong. I have watched football my whole life, and cannot recall a quarterback with such a firm mastery of the option and the naked bootleg, coupled with an innate ability to find the open hole or bowl over defenders with but strength.
|Tim Tebow Game Winning Touchdown vs. Jets|
In Tebow’s first eight games, the Broncos won seven times, in the process tying the NFL record by winning three times in overtime, all due to Tebow-led drives. In 30+ years of football watching, I had never seen a player with such winning tendencies, no matter what team they played for, or what skill set they possessed. Sure, John Elway and Joe Montana were big game quarterbacks, but both were top draft picks with “conventional” skill sets, universally appreciated by football scouts and coaches alike. Tim Tebow was markedly elevating his game each week in the fourth quarter, and doing so with a style never before seen.
In the season’s last three weeks, the Broncos played three of their worst games, as did Tebow himself. He was not the sole reason for the losses, as his offensive line essentially abandoned him while the rest of the team looked lethargic. However, the team backed into the playoffs when its division rivals also faltered down the stretch, setting up Sunday’s playoff game with the mighty Pittsburgh Steelers, whom had a much better season than the Broncos after nearly winning last year’s Super Bowl.
In the first quarter, the Broncos looked like a high-school team, continuing the inertia of three weeks of futility and seven days of media hype of an expected Steelers blow-out. But suddenly something clicked, and they played like world-beaters, both on offense and defense. By the time Pittsburgh scratched back to tie the game late in the fourth quarter, no one doubted Tebow’s passing ability, although it still seemed likely the Broncos would lose to the all-powerful Steelers.
However, the Broncos defense came up big, and after winning the coin toss, Denver started overtime with the ball. On the first play from scrimmage, Tebow tossed an 80-yard touchdown pass to his favorite receiver, who sprinted past the Steelers’ fastest players like a world-class track star, initiating a fan frenzy with an intensity and excitement rarely seen anywhere, even in sports.
The underdog had done it, winning over the fans, the coaches, the media, and the mighty Pittsburgh Steelers!
|Tim Tebow 80 yard Touchdown playoff winner|
Why did I write about such a “non-economic” topic as football? I’ll tell you why, because it inspired me, and nothing pleases the senses of a writer more than INSPIRATION. At just 41 years of age, I feel like my mind is 70, having observed a lifetime’s worth of negatives in my brief 20 years in the business world.
Given my heightened level of perception, emotion, and sleep deprivation, I take in everything, including, once in a while, a story highlighting goodness, character, and winning in the face of long odds. Underdogs often win in the movies and on television, but rarely in the REAL world, and anyone “fighting the system,” as those reading this blog surely understand, is attempting just that.
Thus far, we have navigated a veritable minefield of financial and economic risks, all with the hope of making better lives for ourselves, families, friends, and colleagues. But it won’t be easy, as thus far we have only faced TPTB’s “B” teams, with “A” teams like the Steelers awaiting ahead. Our journey toward the ultimate goals of SURVIVING and THRIVING will only grow more difficult, but fortunately we are armed with knowledge, persistence, and awareness.
I will continue to guide you to the best of my ability, but ultimately it is up to you to PROTECT YOURSELF, so don’t waste time – do it NOW!