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The date was February 29th, 2012.  The European economy was plunging, as highlighted by that morning’s announcement that 800 European banks accepted €530 billion of essentially FREE money to avert bankruptcy – via the ECB’s LTRO2, or “Long-Term Refinancing Operation” scheme.  FYI, the first LTRO tranche – in October 2011 – was €489 billion, bringing the MONEY PRINTING total to a whopping €1.2 trillion.

U.S. economic data was middling at best, but the PPT-supported stock market had recovered all its late 2011 “debt ceiling crisis” losses.  Alarmingly (to the Cartel), gold and silver had recently broken out, surviving a dreadful six months of raids including September’s “OPERATION PM ANNIHILATION I” and December’s “OPERATION PM ANNIHILATION II.  Not only was gold on the verge of taking out the VERY KEY ROUND NUMBER of $1,800/oz., but silver was within a few dollars of $40/oz.  Consequently, PM “sentiment” had recovered to its September 2011 highs – as demonstrated by the fact that I taped a podcast generating 45,000 hits, versus my typical average of 15,000-20,000.

That morning, as I described in detail in Leap Day Violation, Ben Bernanke gave his semi-annual “Humphrey-Hawkins” economic testimony to Congress.  Just weeks earlier, the FOMC had extended the length of its zero interest rate policy (i.e, “ZIRP”) to “at least late 2014,” and his prepared comments – published, of course, at EXACTLY 10:00 AM EST (i.e., “KEY ATTACK TIME #1), suggested absolutely NOTHING different.  “Amazingly,” gold and silver suddenly collapsed; and by day’s end, they were down roughly 6%, despite no other market budging.

The MSM dutifully justified this travesty with drivel that Bernanke was not ‘dovish enough’; when in fact, the day’s only “event” was a vicious Cartel PAPER raid to quash PM sentiment.  Its effects lasted deep into the summer, enabling TPTB to “kick the can” a few more months.  The net result, you ask?  Not only did the economy NOT “recover,” but by year-end, both QE3 and QE4 were announced, and the “fiscal cliff” drama unfolded.  Gold and silver again pushed back to $1,800 and $36/oz., respectively; with the world again in a state of economic chaos…

$GOLD 10-22-2013 2

Fast forward to February 2013, and we’re in the same situation.  Global equities are rising for no apparent reason; as Europe remained deeply in recession, Japan was ramping up QE to historic levels, and the only positive thing about the U.S. “economy” was non-stop PPT market support.  Bernanke again gave his Humphrey-Hawkins testimony to Congress – this time on February 26th; but this time, there was no disputing his dovishness.  Gold rose $30/oz. the second he opened his mouth; and thus, TPTB panicked that a repeat of early 2011 would ensue.

So what happened next?  First off, the ultimate inside traders at Goldman Sachs put out one of their patented ‘gold is about to collapse’ calls; and the next thing you know, PMs inexplicably plunged – culminating in the April 12th-15th “ALTERNATIVE CURRENCIES DESTRUCTION” (after another strangely timed Goldman ‘sell gold’ call) and follow up attacks on June 18th-19th, after the Fed foolishly said it might taper QE if the economy meaningfully improved.  Apparently, the PPT’s inexorable market support – which even a reasonably intelligent fifth grader can now spot – had gotten to his head; well that, and the fact his reign was about to end, with a legacy of NOTHING but non-stop MONEY PRINTING.  And thus, despite middling at best economic data and clear evidence that Fed monetization was necessary to keep rates at record low levels, he uttered these ambiguous, unwarranted comments.

Rates then spiked sharply higher, with the benchmark 10-year Treasury yield nearly doubling, from 1.5% to 2.7%.  Meanwhile, economic data turned sharply lower – particularly in the Fed-supported housing bubble; and the Chinese started selling Treasuries.  All-out panic ensued, with even the Dow Jones Propaganda Average falling a whopping 5%.  Immediately, EVERY Fed President backtracked on the “tapering” comments – including the Chairman himself, on July 11th.  However, despite such jawboning, rates kept rising, with the 10-year yield reaching 3.0% by September.

For some reason I still can’t understand – other than “recovery PROPAGANDA,” that is; the MSM continued to speak of how the Fed was about to taper – and thus, “destroy Precious Metals” (as if, at prices below the cost of production, the Fed’s policies should have ANY impact on them).  Not end it, mind you, but simply slow its pace; amidst a nation hemorrhaging red ink, already way past the point of “financial no return.”  And thus, calls for tapering reached a fever pitch before the September 18th FOMC meeting; when only a handful of people predicted any other outcome – such as, for instance, me.  “History” was subsequently made when tapering was NOT announced; and yet, nearly immediately the MSM spoke of how it would likely occur at the October 30th meeting!  I again stated otherwise; but why listen to me, when the Fed’s track record of forecasting “recoveries” has been so stellar?

And what happened next?  Well, the “government shutdown” and “debt ceiling” debacles, of course; causing economic data to again plummet, massively damaging whatever remaining “credibility” America still had.

US Marco Graph

Third quarter earnings were already horrible (per today’s Caterpillar disaster); the housing bubble was already deflating (per today’s alarming home price data); and mall traffic had already plunged, with the 2013 holiday season already forecast to be the worst since 2009 – which is probably why both Treasury Secretary  Lew and Chicago Fed President Richard Evans practically begged for MORE STIMULUS.  And then, of course, we have yesterday’s CATASTROPHE of a September NFP employment report – including a new 35-year low in the Labor Participation Rate;-  which will dramatically worsen in October, in the wake of the “government shutdown.”

And thus, the ENTIRE WORLD is starting to realize QE “tapering” is not only out of the question next week – but likely, this year.  Said “ultimate insider” Goldman Sachs now says no QE tapering until March 2014; while the – i.e., Deutsche Bank – wonders if it will ever be tapered; and Marc Faber predicts it will be eventually be increased to $1 TRILLION per month.  Faber, of course, was speaking “figuratively” of the inevitability of HYPERINFLATION – which based on history, MUST occur, in both the U.S. and foreign markets.  However, there’s a darn good chance his prediction will one day be literal.

At the Miles Franklin Blog, we don’t predict when “the Big One” will commence – inevitably, launching an historic round of political, economic, and social chaos.  However, we KNOW it’s coming, as the damage caused by four decades of unfettered global MONEY PRINTING has clearly become unsustainable.  Essentially EVERY central bank believes “kicking the can” is the most viable near-term solution; and sadly, the more they print, the worse the situation becomes.  In my view, the “tell” that the END GAME is nigh is that global debt levels are now rising parabolically – particularly those denominated in the world’s “reserve currency.”

Last week’s de facto Congressional decision to lift the debt ceiling permanently was witnessed by the ENTIRE WORLD; and the fact it was done secretly only makes things worse.  Despite every imaginable Cartel effort – such as yesterday’s 2% upside gold cap and today’s 100th visit from the 2:15 AM suppression algo, Precious Metals are again on the rise; with forward rates again negative, Eastern PHYSICAL premiums at RECORD levels, and Western PHYSICAL inventories near RECORD lows.

Thus, the time is NOW to consider protecting your net worth; as sure as day follows night, HYPERINFLATION will eventually reach all global shores.  Give us a call at Miles Franklin and our team of brokers – on average, with 18 years of bullion sales experience – will answer any possible questions you might have.  In fact, we are currently running a rare, must-see special; in which a limited amount of gold numismatics have come to market at nearly the same price as newly minted coins!  Such instances have occurred in the past; but typically they dry up quickly, as supplies are short.