In this weekend’s Audioblog, I discussed how Wall Street and the Mainstream Media, so brainwashed by the financial bubbles Central banks have fostered, have essentially stopped reporting the news. Not just so-called “important” news, but all of it. After all, with traditional media ratings in free fall; journalistic ambition frowned upon – and increasingly, considered “unpatriotic”; what’s the point of wasting time on “non-essential” items like the $57 trillion of debt added since the 2008 financial crisis? Not to mention, hundreds of trillions of “off balance sheet” debt and “unfunded liabilities?” In other words, a combination of laziness, lethargy, and complacency – amidst the indisputably worst geopolitical, financial, and economic environment since the Great Depression. Only this time, with the additional burden of hundreds of trillions of debt; collapsing fiat currencies; massive industrial overcapacity; and financial markets trading at all-time high valuations – entirely due to Central bank money printing and government market support, both overt and covert.
Consequently, the value of truth-seeking media outlets like the Miles Franklin Blog has never been higher. And with each passing day, said “alternative media” will only grow more powerful – particularly when offered free of charge, enabling readers to rapidly disseminate content throughout the world. To wit, I have seen several of my articles re-posted on up to 30 websites in a single day, enabling countless tens of thousands to understand the truth of what’s really going on in the collapsing global economy, rigged financial markets, and the proverbial “war on money” aimed at preventing, at least temporarily, the return of gold and silver to their rightful thrones as the “once and future kings” of monetary value. Today more than ever, as history’s largest, most destructive fiat currency Ponzi scheme passes through its terminal phase, that war is in full pitch – with its ultimate result as inevitable as night follows day.
Over the weekend – ho hum – the only material “news” was that the Greek crises has become so pronounced, Alexis Tsipras appears set to fire Finance Minister Yanis Varoufakis – a de facto “symbol” of the Greek revolt – after a mere three months in office. Meanwhile, Fitch downgraded Japan’s credit rating from A+ to A; putting it dangerously close to junk status exactly two years from the initiation of Abenomics. And oh yeah, dove-tailing perfectly with yesterday’s “all-out bubble mania” article, Chinese stocks are surging – following comments by the PBOC, that it is “discussing direct purchases of local government bonds.” In other words, the first instance of direct, overt, Chinese QE – with $28 trillion worth of “QE candidates.” With a $3+ trillion balance sheet, who knows what kind of horrific bubbles the PBOC will inflate – yielding massive Chinese consumer inflation, but not a whit of economic improvement.
Don’t believe me? Than consider what I just wrote of Japan’s credit rating, literally to the week that Abenomics’ initial two-year plan was to have ended (it has since been increased, with no stipulated termination date). Yes, the BOJ’s two pronged attack of not only doubling the money supply, but overtly purchasing stocks, has created a massive Japanese equity bubble. Yet, conversely, the Japanese economy is at its weakest level of the post-war era – with a government debt/GDP ratio approaching 300%; the world’s worst demographics; and a collapsing currency with a lot further to fall. Putting the “cherry on the top,” former BOJ governor Take Makoto Utsumi not only claimed, this weekend, that an end to Abenomics is “out of the question for the foreseeable future,” but averred that “even the thought of an exit is a nightmare.”
And as for China, don’t for a second forget that as we speak, its gold demand is at an all-time high – which we assure you, will grow exponentially if the PBOC is reckless enough to attempt to replicate the Japanese experience; particularly if – or more appropriately, when – it decides to de-peg the Yuan from its manufacturing share destroying peg with the dollar. Remember, I have all along said the comparatively third world Chinese economy – and dramatically less liquid Yuan currency – would cause it to plunge against the dollar if de-pegged, which is why I have deemed such a potentiality the financial “big bang of all big bangs.” However, if they do so in concert with the aforementioned QE program, said plunge could be historic – in dramatically, and permanently, disrupting the global geopolitical, economic, and financial order. In fact, the negative impact on the Yuan could be so powerful, it’s difficult to believe the PBOC would NOT be compelled to offset the carnage by announcing a dramatically higher gold reserve. Which, no matter what number they publish, will alert the entire world of their long-term intentions – and, of course, gold true value as money.
Before I get to today’s very important topic, let me remind you that this Wednesday is yet another “momentous” FOMC meeting. Since the March 18th meeting, U.S. economic data has precipitously plunged; yielding expectations” – despite relentless Wall Street over-optimism – of an initial 1Q GDP growth reading of less than 1%, to be published mere hours before Wednesday afternoon’s FOMC statement. And thus, as noted in this weekend’s Audioblog, my bet is the “all-important” language will simply be changed from “consistent with our prior stance of patience, we do not anticipate raising rates at the April meeting” to “consistent with our stance last month, we do not anticipate raising rates at the June meeting.” Which will be followed in June by “we do not anticipate raising rates at the July meeting” – and so on, until the next crisis hits, and they start hinting of new forms of “stimulus.” Ultimately, this inevitable “Yellen Reversal” will symbolize an all-in, irreversible “QE to Infinity” policy for all global central banks – as they finally realize fiat currency is indeed a Ponzi scheme that must expand exponentially to avoid instantaneous collapse. Perhaps this is why – again, this weekend – the Boston Fed published a paper suggesting the possibility that QE, indeed, might need to be maintained indefinitely. To wit, “largely missing from discussions about the Fed’s ‘exit strategy’ is a consideration that perhaps it should retain, not discard, its balance sheet tools.”
OK, now it’s time to “get down to brass tacks” – on a topic that has been queued up in my “notes” file for some time, but finally driven to “write-worthy” status by an utter tsunami if news items in the past few days. Which is, to use a new media catch phrase, the exploding, global “war on cash” threatening the savings – and liberty – of billions of global denizens. Not to be confused, of course, with the “war on money” that is the Cartel’s desperate, unwinnable stratagem of denigrating the only real money the world has ever known – at the expense of the worthless fiat currency that forms the base of their unsustainable power. Don’t believe me? Then consider the 599 previous, failed attempts by fiat currency regimes to usurp gold; let alone, the countless dozens plunging against gold as I write.
Generally speaking, there’s no better way to “declare war” on fiat currency value than to initiate zero interest rate – or “ZIRP” policy; let alone, money printing orgies like “quantitative easing.” And now that numerous Central banks – including the world’s second largest, the ECB – have resorted to negative, or “NIRP” interest rate policy, even “war” becomes an understatement. More appropriately, NIRP policy – particularly when combined with QE – is akin to currency “execution” rather than “war.” And no better example of not only destroying one’s currency, but lying to the citizens about it, is what the heinous Swiss Central Bank – led by “Lady Macbeth” Thomas Jordan – has done in the past four years. First, in pegging the Swiss Franc to the dying Euro in September 2011 – and likely, selling a good portion of its already dwindling gold reserves in the process. Next, lying to the public that a “yes” vote in the “Save our Swiss Gold” referendum would destroy the SNB’s ability to maintain said peg. Next, instituting NIRP just three weeks after its propaganda caused the referendum to fail. And finally, breaking the peg three more weeks hence. However, that’s nothing compared to what they are doing today – in Switzerland, the nation universally known for respecting financial independence. Yes, as of last week, they closed all loopholes to its NIRP policy, and instructed banks to not allow customers to make large cash withdrawals – ominously, in the name of the “collective good.” Scary, right?
In Australia, a new “bank deposit tax” is about to be initiated; whilst in Europe, several banks are actually offering negative deposit rates. In other words, you are paying banks that are so insolvent, they require €60 billion of QE each month to survive – and who knows how many off balance sheet “swaps” with the Fed? – to hold your deposit. And doing so, I might add, as the ECB maniacally, overtly targets increased inflation growth – so as to destroy whatever value your Euros still have, after being penalized by negative interest rates. This is why we issued an “urgent cry to Europeans” three months ago – and why the content of last week’s “swaps, trades, and repatriations” webinar, with Miles Franklin’s President, Andy Schectman – should be heeded.
Here in the States, last week we learned that none other than JP Morgan started restricting cash withdrawals in selected cities; terminated clients’ ability to pay for nearly anything in cash; and even prohibited the storage of cash or “non-collectible” coins in safety deposit boxes. Here at the Miles Franklin Blog, we advise you to hold as little as possible in the banking system for this very reason; as clearly, the evil, nation-destroying partnership of Wall Street and Washington is becoming ever more vigilant in its own “wars” against both cash and money. To that end, Citibank – who else? – proposed last week to not only tax currency holdings, but abolish physical currency altogether.
Don’t get us wrong. Some of these “abolitions” are aimed principally at increasing tax revenues – as the less “off the books” transactions there are, the harder it is to cheat. Heck, the State of Louisiana – which is nearly bankrupt due to the collapse of oil prices – actually banned the use of cash in “second hand transactions” last week; whilst Greece is taking equally draconian steps to buy itself a few more weeks of solvency. Which, of course, dovetails perfectly into the next logical courses of action – from the initiation last year of “loose capital controls” in the form of draconian laws like FBAR and FATCA, to socialist taxation schemes as in Canada and Europe.
However, clearly said “war on cash” is far deeper, and more sinister – as unquestionably, governments are intent on not only controlling the flow of capital, but tracking it as well. As a matter of public record, the U.S. Justice Department has ordered bank employees to question all withdrawals of $5,000 or more, and to report what they view as “suspicious” activity. Trust me, I’m well aware of this – having gone through the “third degree” two years ago when withdrawing large sums to pay for my Chinese adoption fees (the Chinese government only accepts cash, and only in the form of perfect, unadulterated bills).
These, my friends, are why it’s so imperative to, as Jim Sinclair would put it, to GOTS, or “get out of the system” as soon as possible – and don’t forget that once the next crisis gets started – likely, “the big one,” – the scope and depth of such draconian government actions will multiply exponentially, as nearly occurred in 2008. That said, the beauty of gold and silver is that not only are they the only money – not just “currency” – the world has ever known; but in owning it, you can avoid all the perils of the aforementioned “war on cash” at one fell swoop. And as for the “war on money,” the Cartel’s machinations are clearly running on fumes at this point – giving the ever-widening gap between supply and demand, and the explosive outlook for such. Hopefully, you’ll be on the “winning side” when these wars are concluded – which, we might add, could be a lot sooner than most can imagine.