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Tuesday
morning, and it looks like I’ll finally get a rest from some of the
marathon RANTS I’ve posted over the past week. Yesterday, I
expended a lot of energy railing at the corrupt and stupid, and thus will be
more subdued today, at least until the FOMC decision at 2:15 PM EST.
Currently, “the consensus” expects it to be a non-event, but
plenty of QE3 hopefuls are waiting in the wings.
Previewing Today’s 2:15pm FOMC Decision
Those wondering
how I write so much should imagine an hour in my head, processing ALL data I
see, constantly trying to build useful mosaics. I scan the internet all
day long for new clues, and appreciate the fantastic information sent by
readers, an invaluable tool in the analytical process. Like a gambler
counting cards, I seek to be as prepared as possible for war
with the FPTB (Financial Powers That Be), whom want nothing more than to
steal my money and pride, as well as that of my readers.
Unfortunately
for them, WE have the upper hand, as WE have fundamentals on our side and
have identified their Achilles Heel – the PHYSICAL gold and silver
markets. History teaches us that PHYSICAL gold and
silver are the linchpin of theglobal monetary
system, the ONLY time-tested measure of universal liquidity and wealth
storage, and no matter how much power today’s governments possess, or
computer technology, or nuclear warheads, they CANNOT, and WILL NOT, have the
ability to repeal the laws of “economic Mother Nature.”
God knows they
have tried, by engineering complex financial products, building sophisticated
algorithms, and surreptitiously disseminated credit to levitate asset prices,
and thus societal morale, high enough to maintain their power base. The
article below is a perfect example of such machinations – the likely
illegal, untraceable and unregulated world of “shadow banking.”
The gist is the
world’s Central Banks, as always led by the Federal Reserve, have
created new ways to inject cancerous “credit” into the system,
fueling mal-investment and inflation, and enriching a handful of
“elites” at the expense of society as a whole, including
countless unborn generations. I have read this article
twice, and still haven’t the faintest idea how such “parallel
universes” of shadow banking and “dark pools” have emerged,
how they work, how much damage they have already caused, and how much they
eventually will, before ultimately collapsing into the financial ether from
whence they came.
The Scramble For US Safety, As Europe Imploded,
Offset The $357 Billion Plunge In Q3 Shadow Banking
Whether via
secret liquidity injections into the “shadow banking system” or
exponential increases in “U.S. dollar swaps” to anyone stepping
up to the begging bowl, the amount of rampant, unrestricted MONEY PRINTING is
startling, the ultimate PONZI SCHEME, requiring increasingly larger
“liquidity jolts” (and PAPER PM suppressions) to keep the patient
breathing.
Global USD Shortage As BoJ Swap Demand Jumps 48x
The leaders of
the FPTB care only for profits, although to them it is as
much a gameas a revenue-generating enterprise. They are
sociopaths that enjoy your suffering as much as their own victory,
perhaps more so, and can FEEL the frustration of those fighting seemingly unwinnable
wars against them. They mock free market denizens when
they bemoan their investments being trashed while the PPT protects Dow 12,000
with predictable, daily operations such as yesterday’s “HAIL
MARY,” and at times believe themselves invincible.
They care not
that their machinations make the situation worse, for Wall Street, Main
Street, and the personal lives of millions, if not billions of
people, continuing to PRINT, BORROW, and SPEND the system into oblivion,
claiming that “cutting” the Pentagon’s 2012 budget to
“just a 1% increase” from last year’s record level will
improve the deficit.
Agencies face budget curbs in $1 trillion bill
They destroy
their own hosts, the hapless banks run by middling bureaucrats with as much
business sense as the academics and attorneys running the government,
believing any damage created can be “fixed” by more
MONEY PRINTING.
French Downgrade – Even More Likely Than
Yesterday
Moody’s may downgrade Spanish banks
Like a hopeless
drug addict, they focus only on the very short term,
rejoicing over “victories” that an over-stimulated two-year old
would find droll, HYPING anythingthey can get the captive, puppet
media behind.
EUR Pops As EFSF Issues 3-Month Payday Loans, Then
Promptly Tumbles On News Greek Lenders Fail To Reach Deal
They misdirect with
their “public faces,” directing their own, clueless
analysts to randomly guess what they are doing, when they themselves have no
idea…
Goldman Punk’d Clients Yet Again
…and are
wrong in their short-term decisions as often as they are right, if not more
so.
What’s
this, after all the HYPE about “Record Black Friday sales,”
November retail sales DRAMATICALLY missed expectations?
Could it be
that RANTING ANDY was right, that all the HYPE about Black Friday has caused
consumers to shift HUGE percentages of their shopping into that one,deep-discounted weekend?
Just wait until
retailers reveal the horrible margins generated in Q4, where
typically ALL the year’s profits are generated.
So Much For A “Record Black Friday”:
November Retail Sales Miss Big
Not to mention
the HYPE about the Greek “haircut deal” in late October, which
was GUARANTEED to save Europe, and by extension the global
financial system. Looks like it was DOA, confirmed today –
not that you’ll hear about it on the financial news.
Greece – No PSI
They think
housing prices are elastic to changes in interest rates, but
nothing could be further from the truth. Home sales continue to
stagnate at record low levels, and now the weakest demand season of the year
– the WINTER – is here. Additionally, note how large the
housing bubble became at its peak circa 2007, and
subsequently how little of the cumulative gains since 1980 have been
lost. That chart has at least another 50% to fall before it completes
its cyclical mean reversion – end of story.
Guest Post: Headwinds For Housing
Conversely,
they erroneously view Precious Metal prices as being as inelastic to
the downside as they are to the upside. In other words, since gold
demand rises with increased prices, they believe it should
similarly fall with declining prices. Once again,
their Achilles Heel is exposed, acute shortages that occur
when PHYSICAL gold and silver prices sharply rise OR fall.
Shortage of
physical metal will be the Cartel’s downfall, and since gold and silver
are the linchpins of the entire, global financial system,
such shortages will ultimately end the tyrannical reign of the FPTB.
Not to be confused with TPTB, which include POLITICIANS and the MILITARY,
which will engage in violent, forceful actions to maintain power, as opposed
to the FPTB, which are limited by the laws of Economic Mother Nature.
Using silver as
an example, the three most intense periods of PHYSICAL demand of the ENTIRE
ELEVEN-YEAR BULL MARKET were late 2008, when the Cartel attacked PAPER gold
and silver to prevent them from being viewed as safe havens, September 2011
after the commencement of “OPERATION PM ANNIHILATION,” and April
2011, when silver reached $50/oz (far more in the PHYSICAL market), just
before the SUNDAY NIGHT PAPER SILVER MASSACRE. In other words, when the
PAPER price is driven too low OR bid to record levels, attesting to the fact
that silver is just as ELASTIC on the downside as it is INELASTIC on the
upside.
To wit,
PHYSICAL gold and silver have proven themselves to be the safe havens they
have always been, outperforming ALL assets classes during the 2000s
“decade of discontent,” and consistently “recovering from
the dead” each and every time the Cartel has attacked, as they did in
late 2008, early 2011, and now late 2011. Conversely, we have seen
three “upside breakouts” during this time, first with silver in
November 2010, next with silver in April 2011, and finally with gold in
August 2011. The Cartel immediately fought back with increasingly
vicious PAPER raids after these breakouts – first, the
“post-D-DAY operations;” second, the “SUNDAY NIGHT PAPER SILVER
MASSACRE,” and now, “OPERATION PM ANNIHILATION.”
In time, both
gold and silver will again achieve ALL TIME HIGHS, and eventually –
perhaps in 2012 – they will be PERMANENTLY BROKEN by an inevitable surge
of PHYSICAL demand as large as the wave that broke the London Gold Pool in 1968,
causing gold to rise more than twenty-fold in the ensuing decade. Of
course, this time around, there is no possibility of a
hawkish Federal Reserve saving the day by raising interest rates to 20%.
I was just
about to move on to my RANT topic of the day when this news hit, yielding a
bit of market volatility, particularly on an FOMC decision day when so many
market participants are praying for Helicopter Ben to either hint of, or
surprisingly announce, QE3…
It’s On: Iran Closes Straits Of Hormuz, Oil
Explodes
TPTB-propped
Dow is unstoppable at this point, as I’m sure, at this point ofmaximum
manipulation, that the PPT would goose it if Iran commenced a nuclear
attack on Israel. That said, please remember
the Dow has ZERO correlation to thereal world, and thus should be
completely ignored as an indicator of ANYTHING related to politics or the
global economy.
Conversely,
gold has MORE correlation to the real world than any other market,
even in its extremely suppressed state. The fact that it is STILL the
best performing asset class of 2011, and the past eleven years for
that matter, depicts rapidly declining confidence in the financial system,
which is EXACTLY why it needs to be swatted down even when Iran closes the
Straits of Hormuz!
And by the way,
isn’t it amazing how even Breaking News is timed
perfectly with Cartel attack patterns, such as today’s daily WATERFALL
DECLINE (and the FOMC decision hasn’t even come out yet) at EXACTLY
10:00 AM EST!
 
Given how tired I
am this morning, and that I have a webinar and podcast to
tape later this morning, I’m going to keep today’s RANT short and
sweet. The title, “FM,” does not refer to an algorithm,
acronym, or abbreviation – just a song, plain old “FM” by
Steely Dan. I’m sure few know that “FM”, the title
track of a 1978 movie of the same name, was the basis for one of my favorite
childhood shows,WKRP in Cincinnati.
http://www.youtube.com/watch?v=roLFgBDIS6s
Nothing
particularly deep about this RANT, and given the heavy nature of recent
writings, my mind is lightened by writing of something so agreeable, while of
course listening to it this very moment.
It just
occurred to me, as I ran on the stair climber yesterday morning and watched
gold and silver prices plummet yet again, that very little selling of actual,
PHYSICAL metal was occurring in the real world, if at all.
Hence, the phrase “no selling at all” rang in my head, just as
the song prates “no static at all.” Every day I look at the
Miles Franklin daily sales sheet, and never do I see buybacksfrom
the public. My guess is that for every $1,000 of bullion sales we
generate, we purchase no more than $1 of bullion from the public. And
I’d bet that ratio is consistent industry-wide.
Earlier, I
mentioned how buying of PHYSICAL gold and silver accelerates on
price declines, and yesterday I wrote that it is nearly impossible to sell PHYSICAL
metal in size into a rapidly declining market, because size sales must
be negotiated. This nuance is particularly relevant in the
tiny silver market, of which the ENTIRE GLOBAL INVENTORY IS ESTIMATED TO BE
JUST 700 MILLION OUNCES, or roughly $25 billion at today’s prices.
If Silver Goes Down All Hell Will Break Loose In
The Physical Market: Silver Investment Update
Given all I am
writing about silver, it should be clear by now that I view it as
the “nerve center” of the Cartel’s Achilles Heel, a tiny
market destined to shock the world due to its unique quality
of being one of just two monetary metals, as well as the world’s second
most utilized industrial commodity (by number of uses). PAPER RAIDS
like we saw in May, and again this Fall, have NOTHING to do with real,
PHYSICAL demand, which grows more rapidly each time the
PAPER Cartel attacks.
PHYSICAL
SHORTAGE will be the END GAME of the Precious Metals bull market, but
unlike all other bulls markets from time immemorial,
PRICES will not peak with supply. This statement sounds enigmatic, but
makes much sense when put into perspective. Gold and silver are not
ASSETS, they are MONEY, and by definitionmoney must be SCARCE,
and even LIMITED.
Supply will run
out because confidence in FIAT CURRENCIES has been lost, making the little
PHYSICAL gold and silver available essentially priceless. I
have been preaching for years that people should PROTECT THEMSELVES, and no
betterprotection can be afforded than buying NOW, when confidence
in FIAT CURRENCIES is waning, but still exists.
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