Yesterday, I wrote of gold’s “battle for $1,250/oz” – in watching the Cartel desperately defend its latest naked-shorting-defended “line in the sand,” as intently as it did at the key round numbers of $1,100, $1,150, and $1,200. Sure enough, “Economic Mother Nature’s” forces overcame them all – just as they will at $1,250, $1,300, and points beyond; and in silver’s case, $16/oz for starters, until it inevitably makes its “ultimate quadruple top breakout” above $50. Hopefully sooner rather than later – but holding physical metal, that can’t be pried but from my cold, dead hands – I can afford to wait.
As for $1,250, this morning’s horrific Belgian terrorist event – which unquestionably, will be linked to the “migrancy crisis” already tearing Europe apart – has again catalyzed its breaching to the upside; whilst silver continues to fight to break above $16, on this “technically historic” day when silver’s 50 DMA finally crossed above its 200 DMA, validating gold’s “golden cross” of a month ago. Not to mention, “fundamentally historic,” as not only is the three-week old Indian jewelers’ strike over, but a major Wall Street firm, Societe General, actually admitted global silver production will plunge 13% over the next two years. That said, as we all know, the Cartel is more vigilant about capping PMs during major geopolitical events than even FOMC meetings – as evidenced by the same “2:15 AM” capping, via prototypical “Cartel Herald” algorithm, as we saw following November’s Paris terrorist events.
Not to mention, the July 2005 London subway bombings; and – heck – 9/11 itself!
That said, now that the U.S.-dollar priced gold and silver “bear markets” are OVER, these manipulative shenanigans amount to nothing more than “noise,” in a world where economic activity continues to freefall, with the prospects of “recovery” from an historic, parabolically growing debt burden as “negative” as the interest rates strangling savers, corporations, and nations alike. This is why market manipulation has gone hyperbolic – to the point that it has become not just a “national security” issue, but a critical part of global government policy. Which, in the big picture, accomplishes NOTHING except still greater financial bubbles, political and social instability, and an increasingly deadly death – I mean debt – spiral. Heck, even Yahoo! Finance’s “top story” this morning was titled “the next housing crisis is here” – focusing on how Fed-induced price bubbles have caused rents to surge, and home affordability to plummet.
Yes, the biggest bubble of all – that of Central bank credibility – has decidedly burst; and with each incremental action, and each spoken word, is driven deeper and deeper into the dustbin of financial history. Which is why the “most transparent lie of all time” – of the Federal Reserve’s insistence that an “exit strategy” from a decade of QE, ZIRP, and other balance sheet busting measures is right around the corner – is being loudly called out, across the four corners of the globe.
It started on April 11th, 2013; when, following the infamous “closed door meeting” between Obama and the top “TBTF” bank CEOs, not only was the heinous “alternative currency destruction” Precious Metal raid executed – which ultimately, commenced the run on gold and silver inventories that has taken the Cartel to the edge of the abyss – but the term “tapering” was birthed, launching the most destructive Central banking propaganda initiative ever.
Three years later, the Fed’s balance sheet is at an all-time high; whilst interest rates, irrespective of December’s desperation quarter-point rate hike – which was nothing of the sort, per the below chart – are no closer to “normalization.” In fact, following last week’s “unexpectedly” dovish FOMC statement – amidst some of the ugliest worldwide economic data since the Great Depression – it’s difficult to believe anyone thinks “normalization” is even possible, unless normalization is re-defined as the “new normal” of negative rates.
Incredibly, with each Fed failure to raise rates – despite unrelenting propaganda of “recovery”; without fail, it has taken no more than 24 hours for propaganda of rates being raised at the next FOMC meeting to emerge. And this time was no different, with not one, but two Fed governors claiming this week that “rising inflation” and “falling unemployment” suggest a rate hike is possible as soon as next month. Both of whom, I might add – Dennis Lockhardt of the Atlanta Fed, and John Williams of the San Francisco Fed – voted to keep rates at 0.25% last week!
In Lockhardt’s case, his inane ramblings of being “confident in a 1Q GDP bounce” – when the quarter is already over, featuring the ugliest economic data yet, sound like the words of a delirious lunatic, who will literally say anything he is told. As for Williams, who smugly predicted four rates hikes in 2016 in December, whilst the Fed’s first “rate hike” in a decade nearly destroyed the world, there may not be a more two-faced politician on the planet, which is saying quite a lot.
Again, the key word here is credibility. And if you think Janet Yellen herself has none, what does that say for these career sycophants, who are basically paid to spew propaganda, taking their cue from the Fed-manipulated markets’ ebb and flow? In my view, Central banks have lost ALL credibility – to the point that they only remaining “tool” they still have is the blatant manipulation of every market, every day, every hour. Which, with each passing day, more and more people are “onto”; making it more and more likely that its inevitable failure will occur sooner rather than later. And nowhere more so than Precious Metals, where the lethal mix of exploding demand, plunging supply, and vanishing inventory has already destroyed the Cartel in hundreds of currencies utilized by billions of people; and shortly, will do so in manipulative epicenter of the United States as well.