December 30, 2014
I’m still on vacation, but too much is going on to take a minute off – much less, a week. Moreover, once this article is posted, I will officially have not missed a single day this year – following a similar “writing percentage” last year. Sometime soon – perhaps very soon – the need to write so voluminously will dramatically decline – as either the entire world will be buying gold and silver hand over fist, or none will be available for the “99%” that haven’t already done so.
Anyhow, in yesterdays “which horror is worse,” we highlighted the incredible amount of potentially catastrophic developments over the Christmas weekend alone. And here we are a day later, following 24 hours when essentially every negative development discussed has dramatically expanded. However, in today’s historically distorted world, where “leading” Central banks attempt to prevent the “unstoppable tsunami of reality” as long as possible, TPTB’s “favored assets” rise against all fundamental reasoning, whilst “unfavored assets” like Precious Metals decline – in the latter case, as usual, in New York COMEX paper trading.
Think about it. Whilst the global economy collapses into oblivion, taking with it commodities, currencies, and geopolitical stability with it, “investors” – i.e., the handful of government and “TBTF” institutions still involved in financial markets – are rewarded for being dead wrong, whilst those investing in defensive assets are fleeced. Fortunately, the laws of “Economic Mother Nature” decidedly cannot be reversed – and the longer such laws are “deferred,” the more vicious her world-destroying wrath will ultimately be.
Amongst the myriad “horrors” discussed yesterday, we started with today’s final stage of the Greek Parliamentary voting process; which as we predicted, was an all-out catastrophe. In other words, the ruling New Democrat party miserably failed to build a consensus; and thus, national “snap elections” to elect a new Prime Minister have been called for January 25th. Given the “anti-austerity” Syriza party is likely to win, it’s entirely likely the “Greek Tragedy” we wrote of nearly two years ago will in fact catalyze a full- blown, Euro destroying PIIGS crisis. All along, Greece has been my top “big one” catalyst possibility; and now, more than ever, such a political, economic, and social cataclysm appears extremely likely. And by the way; unlike the Fall’s Scotch, Japanese, and Swiss referendums, TPTB will be unable to “threaten” the populace by suggesting that a “vote of no confidence” with cause the stock market to decline. To wit, Greek stocks have already fallen 82% in the past seven years, whilst GDP has plunged nearly 30%, unemployment tripled to 25%, and youth unemployment exploded to 50%, whilst the percent of citizens’ incomes below the poverty level surged by an incredible 15x, from 3% in 2009 to 45% today. In other words, Greeks have nothing to lose – and given that the unsustainable explosion of socialistic spending was catalyzed entirely by Wall Street and ECB chicanery, nothing would please the average Greek more than to “destroy the destroyers.”
Regarding the energy catastrophe we shrilly screamed of yesterday, oil prices plunged into the abyss this afternoon, at one point breaching $53/bbl before closing at $53.50/bbl. And this, despite full-fledged execution of the “new, new hail trades” we discussed – in which TPTB goose “paper oil prices” both early and late in the trading day, as they have done with stocks for years. Consequently, global Treasury yields continued to plummet toward “absolute zero”; in the case of the benchmark 10-year Treasury yield, to the 2.2% level we highlighted two months ago as the Fed’s current “line in the sand,” as it desperately seeks to prevent the inevitable global realization that the Fed will follow the Bank of Japan and all Western Central banks in “QE to Infinity.”
Of course, even the Fed’s lunacy doesn’t compare to that of the Swiss National Bank; which despite its best efforts to destroy the Franc by preventing the “Save our Swiss Gold” referendum from passing, and initiating Negative Interest Rate Policy (NIRP) just three weeks later, global investors are flocking to Swiss Franc assets at an historic pace!
And why, you ask? Simple, because the entire world knows the Franc’s Euro peg will shortly be broken, after having all but destroyed the SNB’s balance sheet as the Euro collapses into oblivion. And thus, the fact the Cartel has managed to suppress gold (and silver) prices amidst the exploding global demand such monetary lunacy has catalyzed is truly amazing to behold. Which of course, will inevitably be reversed and then some – as gold and silver eventually go “no offer,” whilst countless fiat currencies go “no bid.”
Yes, the oil catastrophe nearly guaranteed to make the 2008 sub-prime mortgage crisis appear “immaterial” is gaining momentum like a boulder on an icy mountainside; today alone, featuring another $2/bbl price decline, to May 2009 levels; another plunge in the Baker Hughes Rig Count (one day soon, you’ll be as aware of this statistic as I was for ten years, when covering Baker Hughes; a 45% headcount reduction in the nation’s largest oilfield accommodations contractor; and an all-out crash of the Dallas Fed manufacturing index. Heck, even a repeat of last year’s “polar vortex” would be welcome at this point – if only to modestly raise collapsing energy demand. Unfortunately, Mother Nature has a nasty sense of humor, as weather has decidedly not been as cold as a year ago – yielding record oil and natural gas inventories, which will only exacerbate the pace of collapse.
Why did I name today’s article “you can’t make this stuff up,” you ask? Again, simple – as even I am awestruck by how blatant TPTB have become in their desperation to not only stave off the inevitable, but enrich the “1%” at the expense of everyone else. I mean, energy stocks have actually been rallying for the past two weeks, whilst oil and gas prices plunge to multi-year lows amidst an historic, global industry collapse that must dramatically worsen – likely, over many, many years – before even a glimmer of recovery is possible. Secondly, yet again the S&P 500 hit a new all-time high – after “miraculously” reversing overnight losses at EXACTLY the NYSE open, for no reason other than PPT support; whilst even German, French, and British stocks rose as Greek markets imploded, along with the Euro, Pound, and Swiss Franc! And don’t forget the aforementioned, ridiculously blatant Fed propping of the 10-year Treasury yield at 2.2%, despite global yields plunging into the abyss; commodities declining further; and oh yeah, a renewed Ruble collapse that can only yield terrifying geopolitical ramifications.
Of course, those comically blatant manipulations, in sum total, don’t compare to the transparency of today’s Precious Metal paper raids. I mean, just Friday PM prices surged amidst plunging oil prices, currencies, Treasury yields, economic data, and fear of an unfavorable Greek election outcome. Well, today every one of those factors was significantly worse, with a 10% Ruble plunge adding “icing to the cake” of PM bullish factors. And yet, we of course started the week with the 79th “Sunday Night Sentiment” raid of the past 80 weeks; followed by the 353rd “2:15 AM” EST of the past 401 trading days – again just below $1,200/oz; and an all-out waterfall decline at the 8:20 AM EST COMEX opening – which by the way, was simultaneous with the horrific Dallas Fed survey release. By day’s end, half of Friday’s gold gains were gone, and all of silvers – as the Cartel desperately seeks, for the third straight year since reaching the manipulation “point of no return” – to end the year with abysmally weak PM sentiment. And by the way, if anyone truly believes the age-old propaganda that silver is a principally an “industrial metal” – check out the identical chart patterns, as gold and silver have had a nearly 100% directional correlation for not just years, but centuries.
Again, the reason the Miles Franklin Blog not only writes of economic fact, but market truth as well, is to demonstrate how not only is the global economy in its worst shape in decades – if not centuries – but much of what the “markets” purport is pure, unadulterated fiction. As for “paper investments” like historically overpriced stocks and bonds – or for that matter, risk-fraught mining stocks – if you want to speculate on which way they’ll go, that is your prerogative. However, if protecting your assets from the inevitable “end game” of 44 years of global monetary lunacy is your goal, the “risk/reward” balance of Precious Metals has never been more powerful.
And again, as we head into the New Year – and our 26th year of business – if you are interested in buying, selling, or storing Precious Metals, we humbly ask you to give Miles Franklin a call at 800-822-8080, and give us a chance to earn your business.
Thanks very much, and from the entire Miles Franklin team, we wish you a happy, healthy New Year!