It’s Monday morning, and a LOT has occurred since Friday’s impromptu post-NFP
audioblog. Starting with Friday afternoon’s COT, or “Commitment of
Traders” report; which, in demonstrating further “commercial” short covering,
validated what I said last
week – of how the Fed-orchestrated Precious Metals “correction”; based on
a blatant lie regarding potential policy tightening (despite not a shred of
economic evidence suggesting such an event was likely); solely to help said
“commercials” cover their all-time high short position; is OVER. Not
that the Cartel is “letting up” in the slightest – as evidenced by
yesterday’s 146th “Sunday Night Sentiment” raid of the past 152
weeks (LOL, just as gold was about to cross this Spring’s primary “line in
the sand” at $1,250/oz); and 652nd “2:15 AM” EST attack of the
past 747 trading days. And this, as the only significant weekend news
was a plunge in the British Pound, upon news that the “leave”
faction leads in the latest BrExit polls.
Irrespective, the Cartel is clearly in trouble; no less, as Precious
Metals’ “partner”
in destroying the cancerous global fiat Ponzi scheme, Bitcoin, is on the
verge of breaching $600. To that end, I’m now finding myself looking
forward to awakening each morning, knowing full well the majority of major
Bitcoin surges occur in China, where 90% of the volume trades. In other
words, exactly what Precious Metals willeventually become – when China, which
is the world’s largest PM producer and consumer, finally takes the mantle of
the world’s principal gold and silver price creator. This year’s
establishment of the “Shanghai Fix” is a huge start in this direction – and
eventually, Westerners will awake to see “what happened in China” with gold
and silver, just as they do now with Bitcoin.
As for the here and now, if you don’t think the Cartel is staring in the
face of a potentially lethal, manipulation-destroying product shortage in the
coming years – or perhaps, months – take a look at what the COMEX’ registered
silver inventory looks like, after a whopping 3.5 million ounces, or 13% of
the total, were withdrawn Friday. Yes, a new record low level,
of a mere 23.3 million ounces, are available for delivery, worth a record
low $380 million – having just taken out the lows of April 2011, when
inventory was being withdrawn not because the prices was falling, but surging!
In other words, PMs are yet again proving to be price inelastic on both the
upside and downside, unlike any other “commodity” on the planet.
To that end, the great Andrew Maguire noted this
weekend, that the Chinese government has been actively advertising on
national television in recent weeks, encouraging Chinese citizens to buy
gold; and thus, quite obviously setting a new, higher “floor” on the gold
price.
Frankly, I could spend severalpages following up on just how bad the May
“jobs” report was, now that the usual “supplemental data” has surfaced – like
an anomalously positive “seasonal
adjustment factor” – depicting how even the ugliest imaginable
superlatives understate just how ugly the U.S. labor market, and
economy-at-large, are. Suffice to say, the “nine
ugly charts” of how the economy has actuallyperformed under Obama – which
unfortunately for Democratic incumbents, have gone viral – are a
perfect analogy for the difference between the Fed’s propagandized “recovery”
and the real Main Street economy. In fact, if Bernie Sanders
actually winds up beating Hilary tomorrow in the California primary – which
right now, polls depict as a dead heat – the beginning of the end of the
façade of “recovery” will have commenced, for both the Fed and countless
political incumbents. Moreover, it will likely send financial markets
into chaos, putting an enormous “uncertainty bid” under safe haven assets
like gold, silver, and Bitcoin.
That said, the same “bass-ackwards” propaganda that has characterized the
Fed’s three-year market manipulation – and reality-delaying – campaign; which
has dramatically worsened America’s historically bad financial situation in
the process; hasn’t changed a whit. Like Obama trying to “Greenspan-ize”
his horrific legacy by taking credit for a “recovery” that never occurred (to
the contrary, said “nine ugly charts” tell an entirely different story), the
Fed is back in mega-propaganda mode, as I predicted last week. In other
words, a handful of Fed governors espoused the same ambiguous platitudes this
weekend – of rate hikes being “on the table” later this year – as they have
continuously done during the three years since Bernanke’s equally ambiguous,
practically impossible “exit strategy” was first discussed. As usual,
most such talk emanated from non-voting FOMC members; and irrespective, after
just one rate hike in more than a decade – which nearly destroyed global
markets, amidst far better economic conditions than today – even the consideration
of such a move is outright ridiculous. Let alone, with a
potentially historic Presidential election mere months away; and oh yeah,
said “BrExit” – which the Fed itself has cited numerous times as a reason to
delay rate hikes – appearing more and more likely each day.
In other words, the propaganda has been turned up to eleven on a
scale of one to ten, as depicted by this weekend’s Zero Hedge article titled
“rising
rates hit new lows.” In other words, for all the hype regarding the
Fed’s mythical “upcoming” rate hikes, global interest rates are at all-time
lows; with $10.4 trillion of sovereign bonds trading at negative yields before
Friday’s NFP bloodbath, led by the U.S. Treasuries which exploded
higher. To that end, the U.S. 30-year Treasury yield plunged to a new
52-week low on Friday, whilst the benchmark 10-year yield plummeted to within
25 basis points of its all-time low. Which surely will be achieved,
once the Fed is forced by the exploding currency wars to join the ECB and BOJ
in instituting economy-killing – and Precious Metals-igniting – negative
interest rates.
Rest assured, June 15th’s meeting is “off
the table” for policy tightening – and frankly, my “personal odds” of a
rate hike in 2016 are ZERO. As they are for 2017 and beyond, until
surging inflation forces the Fed to, LOL, “defend the dollar” with rate hikes
that would assuredly cause financial markets to implode, and the U.S.
Treasury to default on its massive, historic debt load.
Ah, the peace of mind I have owning physical Precious Metals – and now,
Bitcoin as well – knowing full well how this time-honored, but never on such
a grand scale, experiment in monetary lunacy will end. Likely, far
sooner than most can imagine – certainly, in the dozens of countries whose
currencies have already collapsed; and shortly, in those, like the
U.S., which haven’t yet, but inevitably will.