It’s early – very early – Tuesday morning, and it’s one of those rare days when I don’t have something completely urgent, and compelling, to speak of. Don’t get me wrong, the financial world is chock full of urgent, compelling topics. However, at this rare snapshot in time; five hours before Janet Yellen’s semi-annual “Humphrey-Hawkins” Congressional testimony; two days before the Brexit referendum; three days before the COMEX “Commercials” report if they’ve made any progress in covering the all-time high naked short positions that threaten to imminently destroy them; and five days before Spanish Parliamentary elections; we’re stuck in a temporary financial market “time warp,” in which all markets are on manipulative lock down.
Case in point, the utterly ridiculous “propaganda meme” that Jo Cox’s death changed the course of European history; and consequently, this is “good” for stocks, and “bad” for gold and silver. Which, from a Precious Metals standpoint, will fail as miserably as May’s “FOMC Minutes Attack” – in which the Cartel attempted to smash gold under the false propaganda meme that the Fed was about to, LOL, raise interest rates. Thus, with a lot of “hot money” on the sidelines waiting for such events to unfold – the manipulative mice are playing to their heart’s content; like last night, when they used a prototypical “Cartel Herald” algorithm, at the tried-and-true “key attack time” of 8:00 PM EST, to stop gold’s latest challenge to their current “line in the sand” at the key round number of $1,300/oz. Followed by the 660th “2:15 AM” EST raid of the past 761 trading days; and this gem of a waterfall decline, with no other market budging, a the 7:00 AM open of NYSE “pre-market” trading. I mean, if this isn’t Cartel desperation at its most obvious, I don’t know what is!
Unfortunately, as a Societe General analyst wrote yesterday, “when Brexit has come and gone, the real problems will remain.” Such as the fact that the entire world – quantitatively – is amidst its worst economic condition since the Great Depression. Only this time, debt levels are, literally, thousands of times higher; whilst the world’s nearly 200 unbacked currencies, for the most part, are at, near, or in many cases well below their all-time low levels. And not just against other fiat toilet papers, but real items of value like food, energy, real estate, insurance, education, and any other “need versus want” item you can think of.
Which sadly, due to the Ponzi scheme nature of all fiat regimes, can only end with exponentially increased money printing and debt levels; economic implosion; and inevitably, hyperinflation. And on the way, each draconian political and monetary policy change – ironically, utilized to “fix” the problems, will make them exponentially worse. Like, I kid you not, the IMF’s “advice” to Japan to take its failed “Abenomics” plan to the next level of hyperinflationary hell, by mandating Japanese companies to immediately raise wages on all workers, whilst the national sales tax is raised from 8% to 15%! I mean seriously, I’m not making this stuff up!
In the context of such lunatic Central planning – and by extension, market manipulating – carnage, the world has been “treated” to one debilitating bubble after another since the system peaked at the turn of the century, and broke in 2008. To that end, we have watched countless bubbles burst over the past 15 years – with tragic political, economic, and social consequences; particularly in equities, but also commodities, currencies, high yield bonds, and countless others. And we’re going to see a lot more in the coming years – even the “Dow Jones Propaganda Average”; certainly in real terms, and likely nominal terms as well (unless worldwide hyperinflation is in fact the final outcome). But none, aside from the “Precious Metals suppression bubble,” will be more catastrophic than the biggest bubble of all; that of government-supported sovereign bonds.
As the collapse of history’s largest; broadest; most destructive; and for the first time, global fiat Ponzi scheme has unfolded, Central banks have all – with the exception of a few third world nations, whose currencies collapsed before the rest – taken interest rates to, or in some cases below, zero. Not only that, but “QE” programs, like those currently ongoing at the ECB and Bank of Japan, have promised “investors” that sovereign bonds will be monetized no matter what price they trade at; even if, as in the case of the world’s $10 trillion of negative yielding bonds, the Central bank is guaranteed to generate losses, atop balance sheets so egregiously over-levered, the only way such losses can be “covered” is with additional money printing. Which only makes such leverage larger, in the ultimate game of cataclysmic Ponzi scheme hell.
Better yet, the ECB has led the Central banking world into the corporate bond monetization world – although arguably, they are simply using the Fed’s QE3 blueprint of monetizing mortgage-backed bonds. Heck, the BOJ, the Bank of Switzerland, and a handful of others are now overtly monetizing stocks, to the point that the “ultimate end game of Communism” will eventually result – when governments become significant equity holders. Which in turn, exposes the “myth of QE to Infinity” to its core. I.e., when everything has already been monetized, there’s nowhere left for asset prices to go but down.
Ultimately, “Economic Mother Nature” always wins; and in many financial markets – let alone, the economies underlying them; she already has. However, her biggest victories lie in the future – in many cases, the near-term future; with only “last to go” markets still standing, like the “Dow Jones Propaganda Average”; paper gold and silver; and the biggest bubble of all, Western sovereign bonds. In my view, the “detonators” of such explosions are coming a lot sooner than most can imagine, even if we do not yet know what they will be. Which, is why, more than ever before, the time to PROTECT yourself is NOW.