I know that this is obvious but to the masses maybe it isn’t. Everyone is hoping and praying for more QE to juice the system, rocket the markets and basically prolong the collapse of the Ponzi scheme. By far, the majority, including the PHD’s on Wall Street don’t really think about “where” the QE actually comes from. Yes, some know that it is conjured up out of thin air, some know that it will dilute the existing money supplies and some understand that “debt” is involved. But think about it for what it is, the West as a whole and individually is running huge deficits yet the economies are rolling over again into recession. (As a side note, why is anyone surprised that the business cycle that never really expanded is now turning down again after 4 years, isn’t THAT typical that we run in 4 year cycles?). Can you imagine what global “GDP” would look like with balanced budgets? We would see economies contracting an additional 5-10%!
My point is that no stimulus, no additional QE, nothing can be done without further wrecking the balance sheets of central banks and sovereign treasuries. We are living a vicious circle that is circling the drain. Debt saturation was reached in the private sector by 2006-07 and then the central banks (much to my surprise) “doubled down” until THEY reached debt saturation. Now they have no choices left, they must do more QE yet each Dollar, Euro, Yen and Pound created, brings with it more liability. The problem is that “liability” is exactly what got us to where we are now and the reason that the real economy never really got kick started, debt (liability) saturation levels had been breached. There are no more “White Knights” to ride in and bailout the “bailers”.
I wrote back in 2007 that too much debt could not be cured by “more debt” and that a “solvency problem” could not be cured by more liquidity, this has proven true. At the heart of the problems are the banks, yes we have “sovereign defaults” but they are in the process of defaulting only because they tried to protect their banking systems and put their balance sheets on the line. The fact that balance sheets are grossly broken puts us very very close to a complete lack of control in a world that has been completely controlled. The action in Gold, June 1st and again yesterday was what I believe to be the very first signs that the insiders are actually scared. The equity markets are “convulsing” and we are now hearing calls that U.S. 10 year Treasuries will trade under 1% later this year. I believe that these fits and starts in the metals are the signs of “defections” by those who traded alongside the cabal for so long and in general a loss of “orchestration”. And to hear that “experts” on CNBC are now talking about 1%, 10 year Treasuries, has got to be some sort of an inflection point in a world where inflation is closer to 10%.
As I said, it may be obvious to us but the masses don’t have a clue as to what is coming. If it is true that 100 “paper ounces” have been sold for every one real physical ounce (I am now hearing much higher numbers), then only 1% of those who believe they have “hedged” really have. I also believe that the total global percentage of the population that actually “think” they own Gold or Silver is only 1-2%. If you put this math together, at best, only 1% out of 2% of the population actually owns and has control over any real physical Gold. Doing this math and assuming 1% believe that they own Gold, this means only 1 in 10,000 people actually do, if we assume that the “ownership” is closer to 2% then only 1 in 5,000 actually own metal! Just ONE person in FIVE THOUSAND really, and truly, own precious metals!
Can you imagine how pissed off people will be who own GLD, SLV or any of the major “convenient” ways to supposedly own metal when they find out…oops, there is none? So many who have “hedged” themselves and sleep soundly will wake up one day to find out that their metal was either rehypothecated or lent out, was never purchased or never even existed. not accounted for or accounted for improperly (remember Bob Pisani on CNBC with a “GLD bar” that was owned by someone else? How could “someone else’s bar” ever have left the vault in the first place?) …and these are the people who were supposedly smarter than 98 or 99% of the rest and actually saw a need for precious metals. If “we” are correct (as confirmed by none other than Jeff “it’s all physical” Christian, 99+++% of these “smart people” will have been conned out of their life preservers.
I bring this up because we are very very close to the entire system shutting down to the point where “you will have what you have, and that’s all you’ll have”, my suggestion is to make sure, totally sure, that you have what think you do! Do you have some metal on hand? Is it stored, REALLY stored safely and in a different jurisdiction? Are your mining companies real with real ore in the ground or did you buy it as tip from your Yoga trainer? Do you own an ETF that your broker assures you “has the metal”? Please, do just a little bit of homework and don’t be a part of the 99.8% who haven’t, and will not, before it’s too late!