Let’s talk about financial “experts”; “gurus”; or whatever nom du jour floats your boat. Like political, social, and corporate “ascendants,” they attain their 15 minutes of fame for a variety of reasons – from bona fide success; to diligence, luck, nepotism, or marriage, among others. Whatever the reason, the stars aligned for said “precious few” for a brief period of time, enabling a combination of celebrity, financial rewards, and adoration. And nowhere more so than the financial world, where millions of investors desperately seek people to trust.
Unfortunately, the odds of long-term success in the business world are slim to none – which, by the way, is why it’s so impressive that David and Andy Schectman have been able to maintain Miles Franklin’s financial health, market position, and reputation for so long. Remember, not only is our industry unregulated (except, as of last year, in our home state of Minnesota); but its end product represents “enemy #1” to the political and financial establishment – i.e., Washington and Wall Street.
Regarding financial experts specifically, Warren Buffett is widely considered the “smartest investor of our generation”; when in fact, like Alan Greenspan, much of his success stems from having sold out to “the powers that be.” Which is why the “Oracle of Omaha” was not only bailed out in 2008 – let alone, from the very same “weapons of mass financial destruction” he, in a prior era, publicly railed against – but handed essentially free, “government protected” ownership in fellow “too big to fail” companies like Goldman Sachs and General Electric – in return for years of sound bytes of how strong the U.S. economy is, and how undervalued its stocks. In the meantime, like Greenspan, Buffett started to drink the “manipulation Kool-Aid” himself – yielding last week’s S&P outlook downgrade of Berkshire Hathaway, after it dabbling in one too many ridiculously leveraged buyouts. And while Berkshire stock hasn’t yet been damaged, Buffett’s reputation certainly has – to the point that outside of his personal lapdog at CNBC, Becky Quick, few could care less what America’s biggest corporate sell-out has to say. And to think, his father, the Senator Howard Buffett, was one of America’s pre-eminent real money advocates!
Shifting to the “hedge fund” sector – whose massive underperformance since the 2008 crisis belies the reality that few, if any, consistently generate significant “alpha” relative to broad market averages – “15 minutes” is a wild overstatement of how long they can typically maintain alpha. And frankly, the most valuable asset a good hedge fund manager can have is not the ability to actually make money, but convince investors you have the ability to do so. Bill Miller, Bill Gross, David Einhorn, Steven Cohen, and countless others have come and gone – but few stand the test of time. And that includes me as well, having dramatically outperformed in my personal investments over the first eight years of my “investment career” – from 1999 through 2007 – before dramatically underperformed thereafter (in large part due to the gold Cartel), causing me to permanently end my love affair with financial assets in 2011; and particularly, “paper PM investments” – in lieu of physical gold and silver.
This morning, Paul McCulley, a former PIMCO managing director and long-time associate of the aforementioned, long since discredited Bill Gross (who still seems to be lauded by the financial press, despite being heavily underinvested in the very credit markets he was paid to invest in, amidst an historic, multi-decade bull market), was on CNBC to discuss the same old, tired topic of whether or not the Fed will raise interest rates by a quarter point sometime in the future – be it September, December, or otherwise. To that end, I’m not here to again discuss the ludicrousness of such a potentiality – given America’s massive addiction to record, skyrocketing debt levels, and the all-out, accelerating implosion of global economic activity; currencies; and commodities; occurring in plain sight, for the entire world to see. Oh, by the way, yet another “15 minute guru” – Jeff Gundlach – claimed yesterday that plunging oil prices – having just breached March’s lows – will have “terrifying geopolitical consequences.” Hmmm, I seem to recall having said something similar ten months ago – when I wrote “crashing oil prices portend unspeakable horrors.” Then again, I predicted the Chinese Yuan devaluation back in April, when no one even considered it; much less, on Monday morning, barely 12 hours beforehand.
In McCulley’s obviously “propagandized” view – given he works for a shadowy “think tank,” funded by who knows who – it would be ‘no big deal’ if the Fed raised rates. Aside from his moronic “belief” – or whoever wrote it for him – that the U.S. economy is ‘looking strong,’ he claims the strong dollar is not an issue at all. No, not an issue, despite everyone from the White House to America’s largest corporate titans weighing in otherwise. Not to mention, essentially every Central bank on Earth – each, working in their own interest – debauching their currencies as rapidly as possible, to put the “burden” of a strong currency on America. And this, as America – not to mention, the Federal Reserve itself – sits atop history’s largest debt edifice, supported solely by the very money printing required to hold rates at record low levels. Laughably, McCulley supports his case for the “immateriality” of such a decision by claiming just 13% of U.S. “GDP” is due to exports, “offset” by 14% attributed to “imports.”
Listening to such drivel, I’m reminded of Rodney Dangerfield in my favorite comedy ever, Back to School. When, as a grizzled, successful businessman, he’s forced to listen to an Economics 101 professor tell him how business works on paper. Dangerfield – i.e., Thornton Melon – tells Dr. Phillip Bombay “you forgot a bunch of things”; and eventually, that Bombay’s fictional business model could only exist in “Fantasyland” (MUST WATCH).
To wit, he claims the Bureau of Labor Services, or BLS – which calculates GDP, “double seasonal adjustments” and all – can accurately calculate the impact of a rising dollar on overall economic activity, much less using its arbitrarily GDP calculation. Obviously, he is either lying or speculating; and when the “liar” or “speculator” is of dubious credibility to start with, his conclusions must be viewed with significantly heightened skepticism. That said, it doesn’t take a “think tank genius” to realize the global economy hasn’t been helped by either a “strong” or “weak” dollar. Or that the historic asset bubble collapses; parabolically surging debt defaults; and accelerating commodity, currency, and emerging market equity implosions that would result from rising rates would be a decidedly bad thing for America.
Not to mention, the all-out collapse of the biggest financial and economic Ponzi scheme of all time – in China; or the complete destruction of the world’s largest economic union – in Europe – where this morning’s horrific GDP report put an exclamation point on how bad things have gotten in the land of “NIRP and QE to Infinity.” Let alone, its weakest link – Greece – whose Parliament, laughably, approved “bailout #3” in last night’s wee hours, taking Greece’s real debt/GDP ratio to roughly 300%, and putting it on a crash course with a guaranteed Grexit in the very near future; which, unquestionably, will be followed by not just the other “PIIGS,” but the vast majority of cratering European economies. To that end, take a look at how Greece’s largest, for all intents and purposes nationalized, bank is doing today if you think Greece is saved.
All that said, if you ask “powers that be” with self-serving agendas – like McCulley – they’ll tell you “all’s well; sprinkling in every propaganda buzzword imaginable, from “tapering,” to “recovery,” to “rate hikes.” Of course, all such nonsense is eventually washed over by reality. And thus, I’ll put my “Yellen Reversal” prediction against his pro-Fed propaganda any day. Heck, the Fed is practically screaming it themselves – as following this week’s further, decidedly NOT “strong” data, its own “GDP Now” tracker is forecasting just 0.7% third quarter GDP growth, compared to the current Wall Street “consensus” of 2.7%! And that, before the impact of the past two weeks’ catastrophic commodity implosion have had a chance to filter through to sovereign, municipal, institutional, corporate and individual spending plans.
Sadly, no “powers that be” have agendas more contrary to the “99%” – and for that matter, their own countries – than said Central bankers. Led, of course, by Whirlybird Janet and her world-destroying printing press – which have been eviscerating purchasing power, living standards, and the Middle Class for decades – particularly since the 1971 abandonment of the gold standard. That said, no one noticed, or cared, until the inevitable “debt saturation” fiat currency Ponzi schemes always result in was reached; in America’s case – and most of the world’s – in 2008.
Since then, the money printing cancer that had been gradually spreading since Greenspan took over the Fed in 1987 – when, “coincidentally,” the PPT was officially formed – has not only turned “malignant,” but rapidly infected the entire global “body.” The initial post-2008 money printing orgy took but three years to miserably fail; as when 2011’s Global Meltdown II hit, the European Union was nearly destroyed; America lost its (undeserved) triple-A rating; the Nikkei plunged to a 30-year low, and “dollar-priced gold” surged to an all-time high of $1,920/oz (with silver hitting $50/oz, before the May 1st, 2011 “Sunday Night Paper Silver Massacre”).
Consequently, said Central banks, realizing their “point of no return” had arrived, went “all-in” with an unprecedented scheme of overt and covert money printing, market manipulation, and propaganda – with no peer in history, either in the scope of its operations, or the horrific political, economic, and social damage engendered. Think “Operation Twist and QE3” in the U.S.; Abenomics in Japan; QE and NIRP in Europe, for just a few examples. This, and this alone, is why paper gold and silver prices have been slaughtered – and stocks and bonds boosted – whilst global economic activity has plunged to its singularly lowest point in generations.
Of course, all said scheme has truly “accomplished” is accelerating, and prolonging, the devastating impact of already historic economic overcapacity and financial bubbles – whilst physical gold and silver demand has surged to record levels; above ground inventories evaporated; and the mining industry, perhaps permanently, imploded. I mean, geez, I just yesterday discussed how the bullion industry’s silver supply is vanishing – to the point that 2008-like shortages may well be as imminent as they are inevitable. And yet, with NO OTHER MARKET so much as BUDGING, this is what said “powers that be” just did to paper silver – turning 12 hours of gains into losses with the same “Cartel Herald” algorithm they have used to stop EVERY gold and silver rally for two decades; at exactly the 10:00 AM EST close of the global physical markets; on a Friday afternoon when clearly, said “powers that be” are terrified of what kind of reading and thought might go on this weekend (just look at how many hits, and thumbs up, my latest Greg Hunter podcast, uploaded just Tuesday night, has received). Much less, as physical silver demand – which was so strong, the U.S. Mint was forced to suspend Silver Eagle sales before this week’s massively PM-bullish Yuan devaluation announcements – has rocketed higher, as evidenced by extremely strong buying this week through Miles Franklin, one of the nation’s largest bullion dealers.
Just two weeks ago, I wrote of how the “only difference between late 2008 and today” was the historically manipulated financial markets resulting from the aforementioned post-“point of no return” Central bank machinations. However, the truth is that today is far worse – as not only is the global economy far weaker; global debt levels many multiples higher; and social and geopolitical tensions exponentially broader; but faith in the world’s “financial leaders” has never been lower. Which is quite a terrifying situation, as said “leaders” – i.e., Central banks – have already spent the vast majority of their ammunition, with only one remaining “live” bullet to be used. Which is, of course, all out hyperinflation; to not only pay back exponentially rising debts, but foster a series of “scapegoats” to blame their failures on.
With this week’s commencement of the nuclear phase of the “final currency war” – which thus far, has ushered in the annihilation of countless commodities and currencies, as well as surging physical PM demand – it can’t be long before “Economic Mother Nature” overwhelms the aforementioned forces of financial destruction, unleashing the most terrifying economic scenario in generations. Undoubtedly, the “end of belief that Central banks can save us” is arriving. And to the contrary, by this time next year, I’d be shocked if they are not universally viewed as destroyers of economies and markets, rather than the saviors they purport themselves to be.
To that end, no matter how prescient such views are, I assure you the Miles Franklin Blog will never be viewed as “gurus” – and more likely, “Cassandras” to the bitter end. Fortunately, we don’t care a whit – as if we have convinced just a handful of people to protect themselves beforehand (and frankly, there’s only enough gold and silver for a “handful” anyway), we’ll sleep the “sleep of the just,” knowing our professional lives have been a decided “success
Do they actually believe that everyone is still buying into the PONZI.
Case in point..Scams never end.
Just got a call. From unidentified number. Clue # 1
Clue number two.. Call was from auto dial machine.
Now you are thinking a marketer.
Person claims he is calling from Sweepstake prize Office.lol
In order to proceed he needs my date of birth.again lol
The world is full of get rich quick types who like financial market people…think that getting rich is about fooling others.
I would trust Miles Franklin before I would trust my bank manager.
Soon the truth will be seen.
If you have prepared you are better prepared.
Good luck to us all in the coming weeks and months.
Andy, about Europe I think, its done willingly.
We get flooded by Africans to create chaos and the depts get stacked up.
The strong have to bail out the weak in order to bleed out, as the money goes into the black hole someone put there.
Your predictions are right, but I think they are not blind, its f.cked up on purpose.
Dave Kranzler had stated at some point that:
“It’s an open secret that Becky Quick is Warren Buffett’s mistress”.
Central Banks have done a lot more harm to main street than good.
To devalue the currency ON PURPOSE is lowering our standard of living.
When is main street going to figure it out ???
I have prepared. My biggest fear is government confiscation from the haves to the have nots.
Thanks for all your hardwork, Andy. Your experience in many financial sectors and your understanding of this whole so complex global system is awesome. I read yourself, Holter, Rubino especially because you all can turn complex explanations into simplified language.
I keep thinking that financial stress in the corporate world should show up in the professional sports world? But premier league soccer, MLB, NFL, NBA, NHL, PGA etc seem to keep growing with Corp sponsorship, full venues, and over the top salary contracts. Can this continue if the system is crumbling around them?
It’s still a world of Bread and Circuses – in many cases, run by the state (think leveraged stadium deals, all of which fall on the hands of taxpayers, and none of which are profitable).
Andy, I know Bron Suchecki of Perth Mint had been a troll in the past, claiming there hadn’t been real metal backwardations & even if there were, it’s not a big deal. But this time around, people like Steve St. Angelo & David Morgan are giving some credence to his latest missive. He claims that the crux behind today’s silver shortage is about production issues of mints making enough number of blanks, and doesn’t have anything specifically to do with physical shortage of metal itself. Therefore, there is a severe retail shortage of silver coins. But for institutional investors, there is no wholesale shortage for ordering big size silver bars e.g. in 1000 oz size.
I don’t want to post links of back & forth communications on this, since there are too many links & it can be overwhelming. But assuming you already noticed some of these discussions whizzing by (or even if you didn’t), do you have anything to comment on above claim?
To RetiredCanuck above: If you really want to dig deep into the worst of sports excesses, you need to look no further than Los Galacticos era of Real Madrid. This was even before the 2007-2008 mortgage crisis days. I’m referring to back in 2004-2005. Economy in Spain used to be in the toilet even during those days. Real Madrid were on the hook for multi-million salary tabs of too many superstar players on the team at the same time. Not surprisingly, Real Madrid used to be totally bankrupt, perpetually running in red. And they had the gall to demand Spanish government to keep bailing them out financially, at the expense of taxpayers of Spain!
At one point, Real Madrid squad was filled with following multi-millionaires AT THE SAME TIME: Raul Gonzalez, David Beckham, Zinedine Zidane, Luis Figo, Ronaldo (the fat Brazilian one, not Cristiano), Roberto Carlos, Iker Casillas, Fabio Cannavaro. Every single name in that list was a superstar, to the extent that an ordinary team could’ve afforded at-most a single name on it after taking out mortgages from bankers. Talk about obscene bread & circus excesses!
U.S. Mint silver demand is at a record level, even with the suspensions. I just wrote a special article last week of how demand is so tight, we are now up to 6 week delivery delays at the RC Mint.
I won’t even go into Bron – other than to say remember what I’ve said about the “good, smart people” – i.e., how important it is to identify them, as well as those who are not.
I spent last 24 hours doing investigative research on this Bron Sucheski character from Perth Mint. I didn’t know much about him before. My research went as far back as 2008-2009, but mostly over 2010 to 2013 period. I must now admit that my head hurts. Bron Sucheski has to be one of the most enigmatic characters hiding behind an official “Perth Mint” affiliation. And he’s an extremely dangerous one, due to this enigma. I noticed he occasionally trolled, making comments on this blog as well.
Bottomline is, Bron Sucheski is one of the worst apologists for COMEX, LBMA, GLD, SLV, Jeffrey Christian and most such evils. There had been quite fierce open feuds between Bron Sucheski & David Kranzler. These feuds further dragged in other individuals like Bill Murphy/Chris Powell of GATA, Andy McGuire, Craig Hemke (Turd Ferguson) and more.
It’s obvious to see Bron Sucheski has very little interest in Perth Mint’s actual physical coin/bars bullion business, and talking about importance of physical ownership. He is chiefly a mouthpiece spewing propaganda about how COMEX & LBMA are true price discovery mechanisms, and everything is great about GLD/SLV; WHILE displaying credentials as a spokesman for Perth Mint.
Given this background, I feel it’s very unfortunate that people like David Morgan are now tweeting Bron Sucheski’s apologetic blog articles to downplay silver shortage, and Steve St. Angelo mildly joined as well.
Quoting Steve St. Angelo literally: “Thanks for bringing Bron’s article to my attention. Yes, I will discuss that in a new post in the beginning of the week. While I agree with Bron, I have a different way of looking at the current situation.” I’ll now await this next article from Steve St. Angelo.
To make the long story short, indeed it’s about “good, smart people” and importance of identifying them. Bron Sucheski sure isn’t one of them.
Yes, reminds me very much of Jon Nadler. With initials of “BS,” no less.