Today’s message is “positive” for long-suffering precious metal holders; albeit, decidedly negative for the vast majority of the world’s seven billion denizens. Clearly, we are amidst an “historic inflection point” – both economically and geopolitically; and here at the Miles Franklin Blog, our aim is to enhance your personal due diligence process in the hope you to PROTECT YOURSELF from what’s coming.
In a nutshell, Central bankers have been forcedinto the “Hobson’s Choice” of allowing their cancerous fiat currency regime to instantaneously implode, or commit financial suicide by printing endless amounts of currency and using it to manipulate markets in unprecedented manner. Such madness has been compounded exponentially by “weapons of mass financial destruction” like derivatives and high frequency algorithms; which, incredibly, have pushed Western interest rates to all-time lows and equity valuations to all-time highs – amidst the worst economic environment since the Great Depression, and the worst geopolitical instability since World War II.
Notice, I specifically used the word “Western,” as the New York/London led “Axis of Financial Evil” clearly focuses its manipulative efforts on American, European and Japanese interests – with no regard for, or collusion with Easterners. This is why even the vaunted “BRICS” are amidst dramatic economic carnage, as the only “benefit” they receive is the massive imported inflation from the hyper-inflation of “reserve currencies” like the dollar, Euro, pound and Yen. To wit, since the dollar started “strengthening” last month – amidst the comical assumption of a tighter Fed in the coming years – the ongoing global currency crash has dramatically accelerated. As you can plainly see below, since the aforementioned Western money printing/market manipulation spree accelerated when the “point of no return” was reached following 2011’s “Global Meltdown II,” the average currency has fallen 21% against the dollar, whilst the “Fragile Five” currencies – where more than a quarter of the world’s population resides – have lost a whopping 37%. This is why global unrest and geopolitical tension is exploding, and why Eastern hatred of the West is reaching epic proportions. You know, the type that causes it to create its own currencies, political regimes and military alliances.
As for said Fed “tightening,” just read this morning’s comments from 2015 FOMC voting member Charles Evans, President of the Chicago Fed, if you still have a shadow of a doubt how the Fed really thinks.
Yes, U.S.-led chicanery is drawing the world closer – in all conceivable manners. Its economic data has become such a joke – such as Friday’s upward Q2 GDP revision based on a “definitional change” – that quite soon, truthful analysis like John Williams’ will become mainstream.
The horrifying 47 hours of secret tapes by Federal Reserve/Goldman Sachs whistleblower Carmen Segarra – not to mention, the Fed’s promoting its new “market manipulation office” in Chicago – puts an exclamation point on how rigged financial markets have become; and Obama’s admission this weekend, just weeks after commencing massive bombing raids in Iraq and Syria, that the U.S. has “underestimated ISIS” underscores how Westerners are not only destroying the world but have not a clue what they’re doing. To wit, George Bush announced “Mission Accomplished” less than two months after the March 2003 Iraqi invasion; but here we are in 2014, having destroyed countless trillions of dollars, millions of lives, and America’s international reputation and we’re as deeply ensconced in Iraq than ever.
To that end, the culmination of such lies and deceit has been the all-out destruction of paper precious metals prices since the April 11th, 2013 “closed door meeting” between Obama and CEO’s of the top ten “TBTF” banks, just one day before the infamous “alternative currencies destruction” raids. Since then, PM holders have endured a manipulative infamy that has plunged sentiment back to 2002’s levels – when gold and silver traded at $300/oz. and $4.50/oz., respectively. However, the relentless suppression has also caused physical demand to explode, yielding all-time high global purchases in 2013 and somewhere near those levels in 2014. Given the resultant losses and capital starvation of the mining industry, supply is in the verge of all-out collapse at a time when the aforementioned factors promise to catalyze still greater – potentially parabolically increasing – demand. And all amidst an environment of plunging exchange inventories, such as the measly 80 tonnes of silver remaining on the world’s largest physical PM delivery mechanism, the Shanghai Futures Exchange.
To that end, I wasn’t surprised in the least to read the great Andrew MacGuire’s commentary this weekend, of how amidst an “historic capitulation” of PM investors in September, an astonishing 650 tonnes of physical gold was purchased in the London OTC markets. We agree completely that the latest Cartel raids have been as demoralizing as any we’ve seen. However, holding physical metal instead of “paper PM investments,” we don’t feel the same need of “resolve” technical analyst Bo Polny warned of in May when he correctly predicted a horrific PM crash – bottoming in late September, with the June 2013 low of $1,182 decidedly NOT being breached.
Why do I bring up Bo Polny? Not because I am a believer in his work; or, for that matter, technical analysis in today’s rigged financial markets. However, he is one of the analysts Jim Sinclair looks to in his call for a year-end PM super-spike; along with fellow “cycle theorist” Charles Nenner – who purportedly called the September 2011 top and predicted a September 2014 bottom. Jim Sinclair is on record saying this summer’s correction will be the last before a late year surge towards $2,000/oz., per this analytical conclusion – “Gold’s long-term cycles are in the process of turning long-term positive. There is a strong possibility that this is the last take down before gold trades at new highs.” Moreover, on June 21st the great Richard Russell proclaimed, “The bear market in gold is over, and gold is again in a bull market”; whilst just last week, Bix Weir shouted, “Yay! It’s time to celebrate, as we have finally arrived at the bottom.”
Will they be right? Who knows, but as discussed above, the list of PM-positive factors has become so long and broad, that it’s difficult to believe something won’t shortly “give” in history’s most onerous market suppression scheme. Heck, Andrew MacGuire ended his interview by saying, “I give it until the first of the year before we see the first signs of a major (precious metals) derivatives blowup” and from my experience, NO ONE understands the global physical markets better.
Of course, the beauty of the situation is that care of said suppression, gold and silver prices have NEVER been cheaper on an inflation-adjusted basis, relative to the costs of mining, and countless fundamental, technical and sentimental factors. In other words, NEVER has such valuable insurance been priced so inexpensively; and likely, NEVER will it be again. In fact, if you haven’t purchased it when the “big one” inevitably arrives, you may NEVER get another chance. And by the way, if you want to read an incredibly concise description of the economic tragedy the world faces, there’s none better than this.
