Yesterday at 11:30 AM, I was doing the research for this piece when I got violently sick. I then spent the next 20 hours in bed; and as I write at 9:00 AM today, I am still having trouble focusing. Hopefully, yesterday represented rock bottom for this year’s PM shenanigans; which, by the way, were “conveniently” coincident with the Chinese markets commencing a week long holiday. Not that the PBOC’s sovereign wealth funds took the day off – as according to Andrew Maguire, they decidedly didn’t; but just as was the case on the May 1st, 2011 “SUNDAY NIGHT PAPER SILVER MASSACRE,” it “conveniently” coincided with a Chinese holiday. After all, as China buys 50% of all global production, the Cartel’s only shot at pushing prices down amidst a PM-bullish event like the government shutdown was amidst a Chinese holiday.
Subsequently, as the dust settled yesterday afternoon on one of the Cartel’s most farcical attacks EVER; to boot, ahead of yet another “closed door meeting” between Obama and the CEO’s of the big banks. I lied in bed – in my feverish delirium – considering my recent prediction that PM production would decline 15%-25% in the coming 2-3 years – amidst an environment of exploding worldwide demand.
Last week, Eric Sprott noted his belief production could fall by 5% this year alone; and at that pace, my 2-3 year forecast would be a slam dunk. Never in history has a market experienced such a dramatic supply decline whilst demand surged; but given the “Hobson’s Choice” faced by TPTB of doing nothing or attacking PMs with all their might, such “impossibility” appears more likely than ever. And if it does indeed occur, WATCH OUT on the upside; as prices will rise more than even the most ardent bulls can imagine; although in truth, the story is not of a “PM Bull” but a “fiat currency bear” – which will only intensify as the global economic meltdown expands. To wit, I see the dollar index plunging below the key 80 level today, just one day after the government shutdown commenced; amazingly, to an eight-month low against the equally dying Euro, despite ALL-TIME HIGH European unemployment and an ECB meeting today, in which Draghi essentially reiterated his own “QE to Infinity” platform…
Yes, my friends; that is how weak the dollar’s outlook truly is! And it won’t help that this week’s scheduled NFP payroll report will be cancelled due to the shutdown, since it is by far the most upwardly manipulated of all government reports. As it is, the market will have to digest today’s horrificADP employment report; in which not only was it WAY below expectations, but last month’s numbers were revised dramatically lower. And by the way, the Gallup job creation poll was also released today; also lower than last month’s already pathetic number.
Back to the impending PM production collapse – sorry if I’m skipping a bit, but I’m still running a fever. This morning, absolute BOMBSHELL commentary was released on the topic, in a King World News interview with long-time PM portfolio manager William Kaye. In it, Kaye forecasts 2013 gold production will plummet to just 2,200 tonnes from 2,700 tonnes in 2012. In other words, a 19% year-on-year decline! If this is the case, it’s difficult to see how significant gold shortages won’t crop up by next year; particularly if the final, measly $1 billion of COMEX registered gold and silver inventories come into the crosshairs of the world’s BIG MONEY; such as pension funds like this Dutch one that just won the right to invest in gold.
And now back to today’s MIND-BLOWING evidence of silver manipulation, that even “Bad Bart” Chilton or “Goldman Gary” Gensler couldn’t refute. Ignore, yes; but refute –absolutely not! Amidst yesterday’s PM carnage – which as I write, has been largely recouped – I decided to look up the data from every trading day in 2013. My goal was to see just how many times the Dow had fallen 2% in a day, compared to the “volatile investment” silver. What I uncovered was so damning, it breaks every statistical rule known to man!
Per the incredible table I’m about to present, the Dow has had just one 2+% decline in ALL OF 2013; and that, by just 2.3% on June 20th – after the FOMC hinted it might taper QE if the economy materially improves – which it has decidedly NOT. Frankly, I believe the PPT purposely pushed the Dow down that day to “prove” tapering was a bad idea; and by the way, silver was attacked that day for a comical 8% – and an additional 5% just six days later.
As for the Dow, the odds of an equity index having that little downside volatility; much less, with the Fed maintaining MASSIVE money printing operations due to a dying domestic economy and plunging activity overseas, are ZERO. Not to mention, given the non-stop crises the world has dealt with this year; from the “fiscal cliff”; to Cyprus bailouts; to Syria, Iran, the Fragile Five currency collapses, the U.S. government shutdown, and the debt ceiling crisis – among others. Meanwhile, as the U.S. Mint has experienced RECORD Silver Eagles demand…
…while Indian silver imports DOUBLED, despite the imposition of onerous tariffs…
…we’re to believe that “free market” trading activity resulted in silver having an at least 2% decline on a whopping 45% of all trading days!
Yes, essentially EVERY OTHER DAY silver has fallen by at least 2%; today included, via the by now ubiquitous Cartel Herald algorithm that has stopped not some, but all PM rallies for the past decade-plus. Amazingly, on only 23 of the 85 days in which silver was hit intraday by at least 2% did it actually close 2+% lower. In other words, the Cartel Herald is typically used not to attack, but CAP silver rises; that is, to prevent momentum from building. Even more incredibly, on 40 of the 85 intraday 2+% declines, silver actually ended higher for the day; and on another 11 occasions, less than 0.5% lower. And by the way – as you peruse the charts below; how much more VOCAL can I be of the Cartel’s current “lines in the sand” at $1,330/oz. and $22/oz., respectively?
Back to the magical 2% level – which “coincidentally,” has represented the Cartel’s “limit up” for daily gold increases on 99.9% of all trading days this decade, let’s think about it in terms of the relentlessly government-supported Dow. Which, by the way, is being supported today by yet another prototypical DEAD RINGER algorithm; that is, its loss was capped at EXACTLY the PPT’s 1.0% “ultimate limit down level”; at EXACTLY 10:00 AM EST – 10:30 AM EST, when daily POMO operations are executed; after which, it is slowly “walked up” with ZERO volatility whatsoever. Conversely, if the Dow fell 2.0% – let alone, the MASSIVE 5+% hits silver has been forced to endure eight times this year already – it would entail a 300 point loss. The MSM would be apoplectic about the end of America, and FEAR would encircle the globe. And can you picture such a large intraday drop in the Dow followed by a positive close? LOL, even the PPT can’t accomplish that. This is why the silver action is so “mind-blowing”; so much so, even a reasonably intelligent fifth grader could figure it out…
Again, the job of the Miles Franklin Blog is to educate of the REALITIES of the global economy and financial markets. However, our cause is to empower you to make the correct decisions to PROTECT your assets from the inevitable HYPERINFLATION that follows all fiat currency regimes. The evidence presented here should tell you loud and clear that U.S. equity and Precious Metals markets are but a mirage; and in the case of the latter, dependent on the dwindling supply of PHYSICAL metal that will eventually be unavailable for investment. The more TPTB fights this REALITY with naked shorting of PAPER gold and silver, the more acute the PHYSICAL deficits will be; and when the next crisis hits, if you don’t have your metal in hand, you may NEVER get another chance.
