Those following me closely know I never attempt to “call” the Precious Metals bottom. Nor, more broadly speaking, when manipulative control of not just gold and silver, but the rapidly thinning veneer of “stability” the powers that be have cast over economic trends and financial markets, will be (permanently) destroyed. However, in the past three weeks or so, I have decidedly changed my tune – in no longer stating that it’s “coming”’; but to the contrary, that this point has been reached – NOW.
Said “point of no return” was reached in many parts of the world last year – as depicted by the average currency sitting near, at, or in some cases far below previous all-time lows. However, I now believe it is now here as well – in “first world” countries like Germany, England, Japan, and America – as well as “emerging markets” like China, and the entire “third world.” In other words, as I have stated countless times since year-end – and fittingly, as the Chinese calendar turns this weekend – I don’t believe there’s a chance the world survives 2016 – the “Year of the Monkey” – without a major, catastrophic financial market event. And with it, the “unspeakable horrors” – politically, economically, and socially – that go along with the collapse of history’s largest, most destructive fiat currency Ponzi scheme.
It’s early Saturday morning; and following a week of unmitigated economic and financial market carnage – ending with yesterday’s post-NFP bloodbath, when both the BLS and Federal Reserve may have finally, once and for all, lost all remaining credibility – I’m faced with the longest list of “horrible headlines” I’ve had on a single day. Frankly, I feel like Astro on the Jetsons, trying to keep up with the increasingly fast pace of the treadmill – to the point that I simply cannot alert you of all the ugly, massively Precious Metals positive news flying at us each day. I’ll continue to do my best; but keep in mind that it is no longer possible to cover everything – despite the fact that I write and/or tape a podcast every day. And trust me, that trend will only accelerate, as the “Big One” washes over the planet like none before. And likely, none that will EVER occur.
Per today’s title, Janet Yellen speaks this Wednesday on Capitol Hill, via the semi-annual “Humphrey-Hawkins” testimony the Fed Chairman is required to deliver to Congress. In the past, it was rarely utilized to introduce new Federal Reserve policy shifts – or even “leanings,” for that matter. However, in recent years, the prepared remarks of both Whirlybird Janet and Helicopter Ben have at times dramatically upset the status quo; and given not only the utter collapse of global economic activity and financial markets since the Fed “raised rates” seven weeks ago, the odds of Wednesday’s testimony containing some “unexpected” surprises couldn’t be higher. Let alone, given New York Fed President Bill Dudley’s comments last week – when he all but admitted “policy error.”
In other words, it’s eminently possible that Janet Yellen unleashes the long-awaited “Yellen Reversal” on Wednesday – particularly if financial market “stability” cannot be recaptured by the PPT, Exchange Stabilization Funds by Tuesday night. At which point, it will not only be GAME OVER for the world’s Central banks – and economies – but the gold Cartel itself. Which is clearly showing dramatic, tell-tale signs of occurring in global financial markets – and particularly Precious Metals, where gold and silver prices are surging amidst the most maniacal suppression efforts yet. Not to mention, mining shares having their strongest run since 2011. And oh yeah, the PHYS closed-end gold bullion fund’s discount to net asset value having nearly vanished; which I’ll speak more of in the future – as trust me, if it turns positive, against the Cartel’s best naked shorting efforts, “Admiral Sprott” will pull the trigger on a MASSIVE, physical gold draining secondary offering in a heartbeat!
Per above, I realize it is an impossible task to list all the terrifying, ominous events simultaneously washing over the Fed’s best manipulative efforts to ignore the reality of imminent NIRP and QE4 announcements. However, I want to list a few of the more pertinent headlines – of the past 48 hours alone – to demonstrate what Whirlybird Janet is up against; if not at Wednesday’s Humphrey-Hawkins testimony, than next month’s FOMC policy-setting meeting. Or perhaps, a 2008-like “emergency meeting” in between – most likely, on a Sunday. To wit…
- Despite the publication of every “rumor,” lie, and mistruth imaginable – from imminent Mideast war, to potential Saudi/Russian supply cuts – oil prices crashed yet again on Friday – putting them on the verge of breaching $30/bbl. Potentially, for years to come, in a development that would unquestionably bankrupt hundreds of corporations, and dozens of sovereign nations.
- Exploding social tensions in Europe, as the “migrancy crisis” resulting from crashing oil prices – i.e, the “unspeakable horrors” I predicted in October 2014 – is on the verge of tearing Europe apart.
- The utter failure of recent Central bank “hail mary” policy decrees – from the ECB, PBOC, BOJ, and countless others – to staunch the damage they created, no matter how draconian their announcements. Heck, we learned yesterday that the supposedly “most conservative” bank of all, the Swiss National Bank, has lost tens of billions speculating in the financial markets in the past year alone. First, on the collapsed Franc/Euro peg; and now, stocks like Apple.
- The utter decimation of PBOC currency reserves, to the point that it is now being predicted that China may “run out” – in terms of minimum capital requirements – by mid-year. By the time you read this, China’s January capital account change will have been published. And trust me, if it’s “worse than expected” – assuming they tell the truth – Monday’s going to be a very ugly day.
- An explosion in credit market risk the world round – in the equity, high-yield, and derivative markets; in many cases, rapidly approaching the 2008-09 crisis highs. Ironically, we are seeing a rapidly gather financial storm around some of the very “too big to fail” banks that not only catalyzed the 2008-09 crisis, but are largely responsible – with the aid of their Central banking “partners in crime” – for the hell on Earth we are about to experience. At the epicenter of what may become a 20.0 Richter Scale financial earthquake is none other than Deutsche Bank; which appears on the verge of fulfilling FDIC Vice Chairman Thomas Hoenig’s infamous quote of three years back – that Europe’s largest bank, and largest derivatives purveyor, is “horribly undercapitalized.”
- The complete and utter decimation of the last remaining vestiges of America’s historic equity bubble; from “FANGS,” to “unicorns,” to sundry “market darling” stocks of all kinds. And this, as corporate earnings are already in deep decline, whilst corporate debt is at an all-time high. Not to mention, company-destroying “share buyback” programs, which still rage on – despite collapsing corporate results, exploding balance sheets, and imploding share prices.
- An historic collapse in sovereign bond yields across the “first world,” as investors not only assume “QE to Infinity,” but know it’s coming. To wit, nearly half of all European sovereign bonds are now yielding negative rates, despite the continent’s imminent bankruptcy. As are Japanese government bond yields, whilst the benchmark U.S. 10-year Treasury yield has plunged to 1.83% versus 2.35% when the Fed “raised rates” in January – enroute to breaching its all-time low of 1.49% in the coming months. That is, until the “bond vigilantes” inevitably sense hyperinflation, and destroy sovereign bonds of all kinds.
- Imploding economic data everywhere, as evidenced by the Baltic Dry Index having plunged an astonishing 76% in the past six months alone, to a level way below its previous all-time low. An historic plunge, I might add, that “coincidentally” commenced the day the initial Yuan devaluation was announced – which I opined beforehand would be the “cataclysmic financial big bang to end all big bangs”. That said, it’s here in the States where the pace of economic collapse is accelerating the fastest – as evidenced by this week’s litany of horrifying reports, including yesterday’s January NFP employment bloodbath. And considering Thursday’s release of the ugliest Challenger Job Cut report since early 2009, don’t be surprised if February’s NFP “jobs” approach ZERO.
Meanwhile, as Janet Yellen’s team of taxpayer-funded Keynesian lackeys prepare Wednesday’s Humphrey-Hawkins “word cloud,” physical Precious Metals demand is exploding; whilst already scant above-ground inventories vanish, and mining production implodes. Heck, yesterday alone, even “first world” nations like Australia, Canada, and Japan saw gold priced in their respective, collapsing fiat currencies rise to within 10% of their all-time highs; whilst gold in BRICS nations like Brazil, Russia, and South Africa soared to new all-time highs again, as they do nearly every day now. Heck, even in nations where Central banks have been suppressing prices the most, prices are steadily rising – as in India, where Rupee-priced gold is now just 18% from its all-time high; and even Europe, where Euro-priced gold is a mere 24% away from its all-time high.
Whether Whirlybird Janet takes the “Yellen Reversal” plunge on Wednesday – which in my view, is entirely dependent on her cadre of market manipulators’ collective ability to stabilize financial markets by Tuesday night – is anyone’s guess. However, it’s coming as inevitably – and perhaps, imminently – as the Year of the Monkey follows the Year of the Sheep. As are the Precious Metal supply shortages that will ultimately make 2008 look like the “good old days” in comparison. At which point, you will be kicking yourself – and sitting unprotected in an imminently hyperinflationary world – for not having PROTECTED yourself when you still could. Which, I might add, is a point heavily emphasized in this must read interview with Miles Franklin’s President and Co-Founder Andy Schectman, conducted just two days ago.