The urgency for owning a financial put against the stupidity of central
planners and politicians grows by the minute.
We continue to witness a multifaceted array of failure heaped upon failure
while repeating history on a dramatic scale.
One of the great new wonders of the modern world is the credibility given
to high profile economists.
Obviously, they have no skin in the game, as their predictive misses have
the curious effect of giving them even more credibility.
The fact is that they have been caught wrong-footed with their constant
predictions of an “imminent” economic surge justified by the tiny segment who
nominally benefits from the various and ongoing monetary interventions.
Of course, for most Americans, a depression rages on.
The consensus is that the fall in global trade and decline in retail sales
(despite the surge in utility usage and rise of Obamacare) is all about the
weather or the election.
The monetary overlords have learned that the key to effective behavioral
finance is to inject as many political hot buttons as necessary, ensuring
that the real issues remain fully ensconced in the irrational.
Long forgotten is the fact that assets underlying oceans of financial
assets can never be marked to market or real value.
The housing market has mushroomed yet again into another bubble and
worldwide equity valuations surged to all time highs alongside massive unemployment,
margin leverage, and a sinking Baltic dry index.
In the latest desperation to fuel the credit Ponzi in order to make room
for a new source of REPO collateral, the incredible shrinking bond buying
experiment is being forced into sequestration. Negative interest rates have
arrived and appear here to stay.
Keeping the cost of money low further distorts as the flow of misallocated
capital continues across sectors such as housing and oil.
And if that doesn’t work, there is always the war option.
Not only does war benefit the military industrial complex, but it also
provides room for more bond buying and, hence, a cover for continued low
interest rates.
Tyler Durden, of ZeroHedge summarizes it best:
“But they are finally stirring.
The fun part will be when economists finally do get their suddenly much
desired war (just as they did with World War II, and World War I before it,
the catalyst for the creation of the Fed of course), just as they got their
much demanded trillions in monetary stimulus.
Recall that according to Krugman the Fed has failed to stimulate the
economy because it simply wasn’t enough.
Apparently, having the Fed hold 35% of all 10 year equivalents, injecting
nearly $3 trillion in reserves into the stock market, and creating a credit
bubble that makes the 2007 debt bubble pale by comparison was not enough. One
needs more!
And so it will be with war. Because the first war will be blamed for
having been too small; it is time for a bigger war. Then an even bigger war
and so on, until the most worthless human beings in existence – economists of
course – get their Armageddon, resulting in the death of billions. Perhaps
only then will the much desired GDP explosion finally arrive?”
Considering all of that, the curious case of silver prices should not
surprise anyone.
Observable supply of investment-grade silver is less than a billion
ounces.
Relative to the sheer amount of paper derivatives, this creates the
potential for an imminent and massive move at any moment.
Silver prices, like every other financial assets are manipulated – only
more so and more overtly. This has been the case for decades and merely
follows a lineage that began in earnest when the Hunts attempted to
accumulate a concentrated long position in the late 1970’s.
Silver and the extent that the paper tail of derivatives wags the physical
dog is perfect mirror image of the desperation.
Whether it is new treatments of socialism, or the slow political turning
toward the justification of war, we seem hell bent on repeating the mistakes
of our fathers.
http://www.silver-coin-investor.com/
