If ever there was a day I didn’t want to write, it’s today. After all, this was one of the most mentally exhausting weeks I can remember – culminating with Wednesday and Thursdays’ “FOMC Minutes Attack”; after which, I scripted an epic 42-minutes Audioblog – which must be listened to, as “the pathetically desperate FOMC Minutes Attack will miserably fail” discusses everything you need to know about what really happened, and what really went on behind the scenes.
Immediately afterwards, I flew to Houston for last night’s Q&A Rap Session; which in my view, was the best Andy Schectman and I have put on to date – in large part due to the fantastic emceeing of our good friend Daniel Ameduri of Future Money Trends. Fortunately, we had the event professionally recorded, so I expect it to be uploaded to the blog within days – if not, by the time you read this. And thus, here on Saturday morning, as I sit at the Houston airport awaiting my flight home to Denver, I’m thinking of how mentally (and physically) tired I am; and what fate awaits the financial markets – and world – in the coming weeks and months.
As I scan the list of “horrible headlines” I’ve gathered in the past 48 hours, I as usual see countless article-worthy topics. However, the over-arching theme I’m focusing on is that “the powers that be” have never been close to losing control entirely – which inevitably, must happen in the unprecedentedly manipulated Western world, just as it already has nearly everywhere else. And by “powers that be,” I don’t mean a small group of “elites” planning the fate of the world; but to the contrary, unassociated groups of political, monetary, and corporate leaders in the world’s strongest economic nations. Or more aptly put, those with the most powerful printing presses. Each of these groups have similar goals – of maintaining a status quo in which printing presses enable wealth and power for the 1% running them. Although I assure you, the amount of “collusion” amongst such groups is little to none. As unfortunately, currency wars are zero sum games, in which for every “winner” (LOL), there’s a loser, or losers.
As I consider what happened this week – as discussed in great detail in the aforementioned Audioblog – it’s hard to view it as anything other than a desperate attempt to bail out the increasingly vulnerable “commercial” shorts – on the COMEX, and other paper markets – as the burgeoning forces of economic reality threaten to overwhelm them. It happened five years ago, when said “commercials” were forced to cover shorts into an exploding silver price – to the point that, if not for the last ditch “Sunday Night Paper Silver Massacre” on May 1st, 2011, the Cartel would have died then and there. And it unquestionably will again; only this time, demand is dramatically higher, supply significantly lower, inventories severely compromised, and money printing so massive, there’s essentially no chance that the resulting, inevitable short squeeze will be reversible. I mean, think about it, we’re talking about record gold and silver short positions, with prices far closer to multi-year lows, than highs!
Yes, that’s how one defines desperation. And this week’s comically transparent attempt to fabricate a “PM-bearish” catalyst from the ether – by LOL, propagandizing the Fed is about to tighten policy, amidst the ugliest imaginable headwinds, was undeniably the height of desperation. Let alone, as the last time they raised rates, in December, not only did global financial markets collapse, but gold and silver prices surged. In other words, even at just $1,250/oz and $17/oz, respectively – with Precious Metals sentiment barely registering compared the sky-high levels of 2011 – the Cartel is deathly afraid of losing control. As when they do, the destruction their unprecedented money printing has wrought on Main Street, will unquestionably have a “multiplier effect” on the distorted, manipulated financial markets – which have caused most financial assets to trade at their most overvalued levels ever; whilst conversely, suppressed real money markets have never been more undervalued.
To that end, the perfect case in point is the fact that by promulgating the lie that the Fed is considering a June rate increase, it has – as in December – pinned itself into a corner. In other words, putting the “ultimate Hobson’s Choice” on their plate; as if they are actually dumb enough to do so – amidst political, economic, and financial market conditions far direr than in December – they will undoubtedly ignite a major market crash; likely, of not only stocks, but high-yield bonds, commodities, and currencies. Which in many ways, is already occurring, before said “rate hike” has even been formally discussed.
Conversely, if they don’t raise rates June 15th – which even now, the money markets decidedly don’ anticipate (particularly as the “Brexit” vote is scheduled for eight days later), they risk an utter explosion in Precious Metal markets that were already on the cusp of breaking out. Let alone, if the Brexit referendum actually passes. Only this time, the only remaining “trepidation” amongst PM investors will be eliminated – as if the Fed doesn’t raise rates now, after intimating they were heavily considering doing so, the odds of dramatic breakouts above $1,300/oz and $18/oz, respectively, will be as close to 100% as can be.
Of course, when rats are trapped on a sinking ship – and scurrying for cover – every move they make becomes a Hobson’s Choice. In other words, damned if they do, and damned if they don’t. And by “damned,” I mean that Precious Metals demand will surge – whilst supply declines – no matter what they do. And when the resulting imbalance inevitably – perhaps, imminently – goes past the point of no return, not only will the “New York Gold Pool” be permanently destroyed, but any semblance of hope that “control” can be retained. At which point, you had better have already protected yourselves from what’s coming!