Is this the last time we ever see the “market valuation” of U.S. financial strength – i.e, the 10-year Treasury yield – above 2.0%? It’s quite possible; as per what I wrote in Thursday’s Audioblog, the pathetic, Fed-orchestrated rate goosing around last week’s FOMC minutes publication added a mere 13 basis points – to 2.02% – before losing nearly all those manipulated gains following Friday’s so-called “strong” NFP report. Putting these meager gains in perspective, they were barely half the manipulated 25 basis point gain around last month’s FOMC meeting – as the Fed desperately sought to prevent universal recognition of the “most damning proof yet of QE failure” – which took just five trading days to evaporate. Per the premise of said Audioblog, it’s just a matter of time before the “Yellen Reversal” arrives – i.e., Fed admission that the “recovery” is dead, and simultaneous launch of QE4. And when it does, all remaining Central bank credibility – and ability to “save the day” with new money-printing schemes – will be permanently destroyed. Not to mention, the “New York Gold Pool’s” control over paper gold and silver prices. And now that “that other Achilles’ Heel,” of plunging oil prices, is loudly trumpeting global collapse – and taking the U.S.’s only successful industry of the last six years with it -, that historic day looms nearer than ever.
As for said “strong” NFP report, recall what I wrote Friday morning, just hours before its publication.
Regarding (the December NFP report), my advice is the same as always regarding the “island of lies” reporting of the nation’s most politically-sensitive statistic. Which is, ignore the fraudulent headline numbers and look into the internals; which unquestionably, will reveal a true unemployment situation, at best, on a par with the 1930s.”
Well, the BLS didn’t disappoint, raising last month’s “high bar for government lying” another notch – to the point that my prediction of universal recognition of “the glaring weakness in true U.S. unemployment” may have finally been achieved. Which is probably why stocks, Treasury yields, and commodity prices (led by crude oil) plunged, whilst gold and silver prices surged. To wit, all one has to do to understand just how felonious the BLS’ lies are, is check out the NFP report itself. As if you do, you’ll see the “seasonally adjusted” 251,000 jobs supposedly gained in December were based on a non-seasonally adjusted 65,000 job loss.
Better yet, whilst the “unemployment rate” dropped from 5.8% to 5.6%, the Labor Participation Rate plunged to a new 38-year low, as a whopping 451,000 people exited the labor force in December. Throw in the fact that average hourly earnings declined at the fastest rate since the BLS started calculating this measure eight years ago; and yet again, essentially all new “jobs” were garnered by senior citizens unable to retire because they have little or no savings, and you can see why the true nature of America’s expanding employment Depression is getting easier to understand.
Well, maybe not by the hedge funds we are supposed to be in awe of – which are not only failing at an epic rate despite a six-year equity bull market, but are more short the 10-year Treasury bond than at any time in the past five years. However, for anyone with half a brain, it’s becoming exponentially easier to understand. As for the hedge funds still remaining, they are not only massively short Treasury bonds as QE4 approaches, but heavily long the most overvalued stock market in U.S. history – per the below quote from Jim Paulsen of Wells Capital Management, which manages nearly $350 billion of assets. Gee, what could possibly go wrong?
“The median New York Stock Exchange (NYSE) stock is currently at a postwar record-high P/E multiple, a record high relative to cash flow, and near a record high relative to book value!”
Which brings me to today’s topic, “things I am grateful for”; spoken facetiously, of the myriad expressions of government and Central bank hubris rapidly accelerating the end of their control over financial markets, economic activity, and geopolitical hegemony. In no particular order, here is a summary list of what I’m “grateful” for.
1. I am grateful the U.S. government is stupid enough to lie so thoroughly about economic data, it is rapidly fostering the aforementioned universal disbelief in anything it publishes.
2. I am grateful for the “great deformation” of capital markets, caused by Central bank money printing and Wall Street financial engineering, which has caused such massive overcapacity in industrial commodities – like crude oil – that prices may be depressed for years, or perhaps decades. Regarding “black gold,” the last time the U.S. rig count dropped this rapidly – in 2008 – its ultimate decline exceeded 50%! Remember, oil exploration and production accounts for nearly a third of U.S. corporate spending, and nearly a fifth of U.S. junk bond issuance.
3. I am grateful Wall Street was dumb enough to follow up the subprime mortgage debacle of the mid-2000s with the subprime auto bubble that is bursting today, which will only accelerate its ultimate collapse. Of course, subprime mortgage lending is now being spearheaded by the government itself; as are subprime student loans, and countless other debts that will ultimately fall in taxpayers’ laps.
4. I am grateful that the Swiss National Bank – led by “Lady Macbeth” Thomas Jordan – sold Switzerland’s citizenry out by using every propaganda and market manipulation tool in its arsenal to prevent the “Save our Swiss Gold” referendum from passing. Six weeks later, the Franc is at a multi-year low (with its Euro peg on the verge of collapsing); Franc-priced gold has surged 10%; negative interest rates have been instituted; and Europe is on the verge of financial collapse. Said referendum was the last chance for monetary sanity to be established somewhere; and following its rejection, the path to hyperinflation is more direct, and clear, than ever.
5. I am grateful Scotland didn’t secede from the United Kingdom. You see, 90% of North Sea oil production is based in Scottish waters; and thus, the horrific oil price crash will disproportionately impact Scotland, forcing the Bank of England to print still more money to “bail out” the collapsing Scottish economy.
6. I am grateful to Goldman Sachs for helping Greece hide hundreds of billions of Euros of debt, accelerating the collapse of the doomed-from-the-start, continent-destroying Euro currency experiment. The Euro hit a new ten-year low this week, which is quite scare given its only 15 years old. And once Syriza takes over Greece after the January 25th elections, don’t be surprised if a catastrophic, irreversible “PIIGS” crisis puts the Euro’s very existence into question. Gee, I wonder what direction European gold and silver purchases will take.
7. I am grateful for the relentless hype of an expected strong holiday spending season; let alone, equally relentless hype of it being “salvaged” following catastrophic “Black Friday” weekend sales. Wednesday morning, December sales are expected to be reported as negative; and in the coming weeks, the “retail Armageddon” I forecast in my “2015 predictions” will arrive with a vengeance.
8. I am grateful that the Chinese government will be stupid enough this Tuesday (January 20th) to report 7% or so GDP growth; in doing so, solidifying global understanding that “all economic data are lies.” I mean, how anyone can believe China’s economy is growing at all when its PMI diffusion indices are below 50; the rest of the world is contracting; and oh yeah, China’s historic real estate and construction bubble is collapsing, is beyond me.
9. I am grateful that global Central banks, under the guidance of fraudulent accounting rules generated by the evil IMF, have blatantly overstated the amount of their gold reserves. This will only foster the universal realization of unprecedented supply tightness that much faster.
10. Last but not least, I am grateful for the U.S. dollar’s recent, hyperbolic surge – taking the U.S. dollar index above its ten-year trading range. As first noted in September’s “single most PM-bullish factor imaginable,” the dollar surge is decidedly not due to “relative strength” of the U.S. economy; but instead, fear of global economic collapse. To wit, the higher the dollar index rises, the more catastrophic global implications it will have – yielding the potential for hyperinflation, geopolitical tension, and WAR.
Hopefully, you understand I am not actually “grateful” for these horrific circumstances. They were set in stone when the gold standard was abandoned 44 years ago; and trust us, it’s no coincidence they are occurring simultaneously. The end of history’s largest fiat Ponzi scheme is nigh; and the way things are headed, the “big one” could commence any day now. And when it does, if you haven’t already protected yourself with REAL MONEY, you may never get the chance to do so. Certainly, not at prices remotely close to today’s historically suppressed levels.
PROTECT YOURSELF, and do it NOW!
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