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The Philosopher’s Stone is a legendary alchemical substance capable of turning lead to gold.  It was also believed to be an elixir of life, useful in achieving rejuvenation and, potentially, immortality. For many centuries, it was the central symbol of the mystical terminology of alchemy, symbolizing perfection at its finest, enlightenment, and heavenly bliss.

Ah, if life were that easy. 

A single “stone” to cure all ills, a universal panacea.  Not only could it cure the cold, poor vision, and cancer, but turn my pencil’s lead into gold.  A lead pencil contains roughly one-tenth an ounce of lead, valued at roughly 0.6 cents, while one-tenth an ounce of gold is valued at approximately $180.  Assuming the COST of such transformation is not prohibitive (it might be), that’s quite a return on investment!

Given this transmutation has been attempted for more than 4,000 years, we should have a good estimate of Alchemy’s capital costs by now.  I can excuse Enki for not having left notes in 3,000 BC, as neither paper nor iPads existed.  But surely some of the world’s most diligent alchemists, generic symbols of brilliance such as Plato, Aristotle, Newton, Faust, Magnus, and Bacon, did.  No, you say?

In the big picture, it wouldn’t matter if the process required a particle accelerator,

rare elemental catalyst from Uranus, or the heat and pressure of the earth’s core.  The fact remains that in 4,000 years, no one has found the Philosopher’s Stone.  For that matter, no one has found the cure for cancer (a presumably simpler task), or how to pay off national debts greater than GDP.  Life is not simple, and if we learn one thing in our days, it should be that shortcuts DO NOT EXIST.  The mystical art of Alchemy represents the quest for the ultimate shortcut, but unfortunately has come up empty-handed after four millennia of research.  Then again, the second it proves lead can be turned to gold, gold will become worthless (or, at most, 0.6 cents/oz.), negating 4,000 years of research, and generating the worst return on investment in history.

Moreover, in calculating the cost of turning lead to gold, there are numerous “hidden costs” never considered, yet another blow to alchemical proponents.  Even if one possessed the Philosopher’s Stone, they would still have a major issue to contend with – a consistent source of lead.  Lead may be considered a “red-headed stepchild” in relation to gold, but that doesn’t make it cheap and plentiful.  Lead mining is among the world’s most dangerous, and costly activities.  Nearly all lead mines are deep underground, built with huge capital costs and the overarching “cost” of lives from lead dust poisoning.  Lead mines are only economic because lead typically bonds with other metals (such as zinc, silver, and copper), and are highly economically sensitive.  Thus, even if an alchemist had his own lead mine, it might be mothballed in times of recession, the times when gold would be needed most.

Why am I penning these philosophical metaphors in front of a hard-earned weekend?

Because people must keep their guard up, as NOTHING has changed in Europe, the U.S., Japan, or, frankly, ANYWHERE in the world in the past two days.  I have written exhaustively about the PPT’s market-supporting operations for years, but particularly in recent weeks as such efforts, coupled with gold and silver suppression, are essentially the ONLY tools left in TPTB’s arsenal of PERCEPTION influence.

Wednesday afternoon, financial markets were finally feeling the full weight of Europe’s failures, suggesting an understanding the PIFIGS were past the point of no return, with no solutions possible.  Since that time, the only fundamental change has been the expected resignation of Italy’s Prime Minister after a faux austerity measure is signed this weekend, and a maniacal PPT intent on convincing you this is a material, positive event.  Remember, the same exact issue occurred LAST WEEKEND in Greece, yet by Wednesday markets were crashing and Greek bond yields hitting all-time highs.

In no particular order, you may want to peruse the below headlines (all from the past 24 hours) and decide if you believe Italy’s woes have been resolved, or the Euro Zone as a whole, for that matter.  Italy, which has a population of just 60 million (0.8%) of the world population, has $3 trillion of debt.  In other words (excluding off-balance sheet debt such as unfunded future liabilities), Italy has one-fifth the population of the U.S., and one-fifth the debt, putting it on par with America as the most indebted nation, pound for pound, ON EARTH.

Changing Prime Ministers doesn’t change Italy’s debt problems, just as Greece’s debt problems haven’t changed with this week’s resignation of Prime Minister Papandreou.  To the contrary, “change” typically makes things WORSE, as new political groups tend to seek MORE draconian measures to win over the disgruntled populace.  Case in point, following America’s economic disintegration under eight years of the Bush administration, the public voted out essentially ALL Republicans, handing the reigns to an Obama Administration controlling both the House and the Senate.  It took just two years for Obama to lose the House and nearly the Senate, and by 2012 the cycle will be complete, setting up the Republicans to fail again, in more spectacular fashion than Obama’s Democrats before them, and Bush’s Republicans before them…

Europe Warns EFSF Will Not Reach €1 Trillion, EFSF Yields Remain At Record Wide

Shifting To Short-Term Funding For EFSF Is A Sign Of Weakness

Slovak PM Joins Calls For Eurozone Split

Rob Arnott – Defaults & Disorderly Contagion Around the World

Meanwhile, Someone Forgot To Invite France To The Party

CDU Escalates Plans For EU Treaty ‘Adjustment’: Wants Option For To Kick Habitually Broke Countries Out Of Eurozone

Readers, you must strive to SEE THROUGH the PPT-inspired market action of the past two days (particularly during thin Veteran’s Day/Armistice Day conditions), and read the “horrible headlines” carefully.  THEY are what tell the truth of what is going on, and what to expect in the coming weeks and months.  And each time you see a blatant attack of the PAPER gold and silver markets, make sure you inculcate the below information about the PHYSICAL market, i.e. the REAL world!

Silver Eagle Bullion Sales Hit New Record in 2011