Not Even The Smartest Investors &
Traders Understand What’s Coming To US Economy, Gold & Silver
SD Outlook: Gold
& silver look strong, so let’s understand why the economic collapse
will be very brutal for almost everyone. Everyone, that is, except…
Imagine a smart
person.
Person B.
How smart is he?
Well, if you’re
smart enough to have the patience of a cougar while the rest of the trading
and investing crowd get their faces ripped-off, you’ve got a pretty good
grasp of the markets.
But not necessarily
the economy.
Now, imagine a
similarly intellectually sufficient person.
Person C.
Person C strikes up
the argument, “we never went to the moon” with Person B.
Person B responds,
“I’m sorry, the earth is not flat”.
Uh, OK.
The debate is
settled then, right?
Of course not.
The debate never
even really began.
Why does it matter?
Because we have some
of the very smartest people in the world of trading and investing, engaged in
a meaningful discussion on the markets and the economy, yet they have
completely missed the point. Since some of the very smartest people in the
markets and the economy are missing the point, we can only conclude that the
vast majority of all people on this planet do not even know what the moon or
the earth are.
So when we hear
bearish, bad news talk about the economy, it becomes difficult to understand
just how bad things are about to get.
How do I know this?
Because two of the
smartest traders/investors around have completely missed the point on market
manipulation.
Here’s my point – They completely don’t know how to explain
the manipulation in the first place, so how could they really know what is
about to go down with the markets or the US economy?
For those who don’t know, the principal market manipulative
power in the United States is the Exchange Stabilization Fund (ESF), within
the Treasury Department. On the surface, the ESF is under the direct control
of the President (currently Trump), and the ESF works in conjunction with the
NY Fed to carry out ESF operations.
The ESF was created and funded (with Unconstitutionally
confiscated gold) in 1934, but since the ESF basically has two sets of books,
one minimalist that are open to the public, and the other that are kept under
closely guarded secret, what we know about the fund, publicly, is that it can
basically intervene in any market it wants, at any time, and for any reason,
all of which the ESF does not even have to inform the public of.
You know – for “national security”, “state secret”, or
whatever other excuse you want to dish out for the government’s sanctioned
manipulation of any and all markets.
My point is that this lack of understanding about the market
manipulating structure in the United States means that this economic collapse
is going to be way more brutal than even the most gloomy of the
gloom-n-doomers is predicting.
Why will it be way more brutal?
Because of the whole “the longer we put it off, the worse it’s
gonna be” thingy.
You see, we’ve been on that ESF controlled market-manipulation
road for 85 years.
The end of the road is near.
OK, “Hey Half Dollar, yeah, yeah, the economic collapse is
gonna suck. That’s all great and all, but c’mon man, Chris & Fleck are
both gold bulls, so do they really miss the point?”.
Fair question.
Yes they do.
You see, if you listen to the entire interview, especially the
part where Fleck gives his reasons for why he thinks the price of the yellow
metal is going up, you will notice one thing that isn’t even considered.
What is not even considered?
The reset.
Of all the reasons to be bullish on gold, the reset is not
even mentioned.
Why does it matter?
Because we know for a fact, throughout all of history, resets happen as
the people always return to gold & silver. When the reset happens, you
either have your gold (and/or silver), or you don’t.
Many times the analogy is used that you either already have
your seat aboard the train, or you will miss the train when it leaves the
station.
That’s a good analogy.
Let’s look at some of the most recent monetary resets along
with other events worth noting:
What can we conclude from looking at several of the last
resets and other events worth noting in gold & silver?
1. Resets
happen.
2. We
are long overdue.
3. It
is only a matter of time.
Circling back, there are two main points which are critical
for understanding what is about to happen to the markets and to the economy.
First of all, the very smartest traders and investors do not
even understand that these markets haven’t been free for 85 years, or 106
years if we start from the bastardization of the Fed. Secondly, Resets
happen, and not only are we long overdue, but the economy and the markets
have been on life support for quite a long time, and not only that, but I
think we all understand what “brain dead” means?
And that is exactly what our markets and the US economy have
become.
Brain dead.
We’re about to find out who pulls the plug.
Moving on.
Basically, all government reporting agencies have plenty of
time and plenty of motives to create whatever narrative they want with the
data.
It will be interesting to see how the delayed data compares to
the data we get when the government’s all caught-up, which it may never be as
quick as our President is with playing the “Government Shutdown” card.
I’m somewhat looking for a breather in gold & silver
prices this week, but I’m also bullish, and even more so on the look-out for
a continuation of the rally.
I’m not looking for a significant pullback here.
During any pull-back, I would look at that as a place to
acquire physical because the overall trend is up.
Silver is in the $15.70s to start the week:
I’m not thinking we get those deep, nasty, smash-tastic
candles like we got last April and May, because I think that not only “the
trend is your friend”, but I think that silver is also about to put in a
“golden cross” on its daily chart.
Bullish.
Furthermore, if silver closes lower on the day to start the
week, that’s three days in a row of down days, and if the trend is up, I
would assume that dips would be bought, and as dips are bought, pullbacks are
not as long lasting.
See what I mean?
Bullish.
Gold is under $1320 to start the week:
But gold is in an even better position than silver here as
gold has already put in its own golden cross.
Notice too, this would be the third day in a row of closing
down, and if the trend is indeed up, which I think it is, then I’m looking
for shallow and not long lasting pullbacks, and as such, I really wouldn’t be
surprised to see both gold & silver continue their rallies this week.
Besides, everybody is expecting a pullback, but what if it
already just happened?
I think it may have.
We’ll see.
Fortune continues to be on anybody’s side who is interested in
both investing for the first time, or for getting in on the gold-to-silver
ratio arbitrage play:
Right not it takes some 83 ounces of silver to buy one single
ounce of gold.
Some time down the line, because the ratio will begin to
revert to the mean, it will take much less silver to buy an ounce of gold,
and thus silver can be converted into free ounces of gold. This is a
long-term arbitrage, so the investor must be willing and able to wait it out,
but let me tell you where we are in the arbitrage play –
You know the pirate ship ride at the state fair?
The one that is just a giant swinging boat, that scares the
dickens out of most people as it swings back-and-forth like a pendulum?
Well, silver is at the point where the boat has swung as far
at it will swing in one direction, and we all know what happens next.
The pirate boat swings in the other direction.
What I am saying is that the gold-to-silver ratio, like the
pirate boat ride at the state fair, is about to swing in the other direction.
Palladium is finding support at $1320:
Palladium’s technicals are improving too.
I think platinum can do battle to take-out its 200-day moving
average this week:
Of course, that assumes the rally continues this week.
Speaking of taking out its 200-day moving average, here’s the
stock market:
There is a major difference, however, between the stock market
and platinum’s 200-day moving average.
Platinum is taking out the average coming out of a bottoming,
whereas the stock market has taken out the average on a bear rally.
So here’s the question: Is the stock market going to keep on
rising to new all-time highs, or is the market going to turn down and head
lower?
I think the stock market heads lower.
I also think volatility may finally start getting interesting
this week:
I think we could really turn the corner here and start to see
some spikes again soon.
Imminent?
I’m not sure.
But I would not be surprised either, especially if the metals
continue to rally.
I’m still looking for short-term downside pressure on interest
rates:
If we see both a spike in volatility and a significant drop in
the stock market, then I’d be looking to take out the recent low in just a few
days worth of trading.
I do not think the dollar just put in a higher-low:
I think the dollar just put in a lower-high, and we’re
on-route to a lower-low.
I’m bearish on the dollar here.
Copper has had a pullback over the last few days and into the start
of today:
I think copper can do battle like platinum at its 200-day, and
if copper wins the battle, that would be a nice looking break-out on the
chart.
Behold the most epic wall of worry with crude oil:
Crude oil is definitely climbing it.
I’ve been saying upper $70s by Spring or Summer, and while I
don’t think it’s wise to forecast both price and time, I’m cool with testing
myself like that because I don’t have skin in that crude game.
Pun intended.
What’s the bottom line for this week?
Well, it is the start of February, and “Arctic-geddon” or
whatever they called it has finally moved-on.
So it’s back to business as usual.
Hit the ground running.
However, as everybody hits the ground running, we must
understand that some of the very smartest investors and traders around have
absolutely no idea of what is about to truly happen to the US markets and to
the US economy.
It is going to be brutal, and most everybody will not be
prepared for it.
In my opinion, not being prepared for what is coming will be
the difference between suffering and thriving.
Those who have prepared with gold & silver will thrive.
Those who have paper wealth will suffer.
Those who have land and real estate?
They may not suffer like the rest of the sheeple.
But they won’t be liquid like gold & silver investors.
Liquidity is the key to being agile.
Agility is the key to thriving.
Stack accordingly…
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Do you remember Dr. Ron
Paul asking then FED chairman, Ben Bernanke, why is it that central banks
"own gold?" and Bernanke, forever loyal to his true superiors, the
dollar manipulators, replied "because it's tradition."
Judging by this chart, it's more than tradition, old Benny; it's a CRITICAL STRATEGY.
Central banks are hoarding gold, purchasing it in amounts that rival the shopping spree of a recently divorced hedge fund wife, who got free access to a credit card and the ex's settlement money. Like her, central banks are buying gold, non-stop.
The 2018 gold buying spree by central banks is the biggest it has been in 47 years.
Investors have already priced dovishness into the S&P 500, so I wouldn't rule out another big correction unless a new bullish catalyst surfaces. This January rally is far too extended.
As investors, we don't care what happens next, though. We react to events, instead of attempting to predict them. If stocks rally, we remain patient, not chasing prices up. If the markets correct, we invest in companies that have become attractive and meet our criteria.
What we know for sure is that even though the Fed is signaling that tightening is done, investors don't trust the gold bull market because the short sellers are back in droves. The short-sellers attempted the same thing in 2016 and were forced to cover while the mining shares went parabolic. We shall see how this leveraged bet ends for them this time around.
This doesn't smell or feel like the rate cuts and QE optimism of 2009 or 2011. This is forced stimulus, whereas in 2009, the economy was weak and recovering. Today, the situation is completely different and adding liquidity is a mistake.
Smart money isn't really getting worked-up about stimulating an economy that's already at full capacity. It's a euphoric rally, this January one, not a justified one, based on improved fundamentals of any kind.
Personally, I wouldn't be surprised if the next release of public filings shows that many of the smartest investors have been taking profits thanks to this January boom, not increasing positions.
This entire free money stimulus is already baked in the cake. When the FED lowered interest rates in 2011, the economy was weak and recovering, stocks were undervalued, and it made sense to go all-in. Now, the U.S. economy is stronger than in recent years. If you stimulate it, stocks won't be the only asset class to get inflated – commodities will as well.
Investors got burned so badly in the past two years after the false breakout of 2016 that the trauma hasn't been forgotten about yet.
What I follow more closely than anything else are (1) the amount of daily trades for my basket of tell-tale mining stocks and (2) the volume size.
When there's interest in miners, both of these multiply by 50-100 times. It is like thousands of investors come out of the woodworks all of a sudden.
It's not happening at the moment. We're in the denial phase. No one trusts gold to not disappoint.
When investors really come to grips with the huge bailouts that the Federal Government will have to approve for pension funds, unemployment benefits, and income security in the next recession, denial will morph into epiphany.
Gold is the right trade. Silver is the match that lights up the sector, so we'll have to wait for the ratio to shrink to 70:1 before fireworks occur, but we're getting really, really close.
Judging by this chart, it's more than tradition, old Benny; it's a CRITICAL STRATEGY.
Central banks are hoarding gold, purchasing it in amounts that rival the shopping spree of a recently divorced hedge fund wife, who got free access to a credit card and the ex's settlement money. Like her, central banks are buying gold, non-stop.
The 2018 gold buying spree by central banks is the biggest it has been in 47 years.
Investors have already priced dovishness into the S&P 500, so I wouldn't rule out another big correction unless a new bullish catalyst surfaces. This January rally is far too extended.
As investors, we don't care what happens next, though. We react to events, instead of attempting to predict them. If stocks rally, we remain patient, not chasing prices up. If the markets correct, we invest in companies that have become attractive and meet our criteria.
What we know for sure is that even though the Fed is signaling that tightening is done, investors don't trust the gold bull market because the short sellers are back in droves. The short-sellers attempted the same thing in 2016 and were forced to cover while the mining shares went parabolic. We shall see how this leveraged bet ends for them this time around.
This doesn't smell or feel like the rate cuts and QE optimism of 2009 or 2011. This is forced stimulus, whereas in 2009, the economy was weak and recovering. Today, the situation is completely different and adding liquidity is a mistake.
Smart money isn't really getting worked-up about stimulating an economy that's already at full capacity. It's a euphoric rally, this January one, not a justified one, based on improved fundamentals of any kind.
Personally, I wouldn't be surprised if the next release of public filings shows that many of the smartest investors have been taking profits thanks to this January boom, not increasing positions.
This entire free money stimulus is already baked in the cake. When the FED lowered interest rates in 2011, the economy was weak and recovering, stocks were undervalued, and it made sense to go all-in. Now, the U.S. economy is stronger than in recent years. If you stimulate it, stocks won't be the only asset class to get inflated – commodities will as well.
Investors got burned so badly in the past two years after the false breakout of 2016 that the trauma hasn't been forgotten about yet.
What I follow more closely than anything else are (1) the amount of daily trades for my basket of tell-tale mining stocks and (2) the volume size.
When there's interest in miners, both of these multiply by 50-100 times. It is like thousands of investors come out of the woodworks all of a sudden.
It's not happening at the moment. We're in the denial phase. No one trusts gold to not disappoint.
When investors really come to grips with the huge bailouts that the Federal Government will have to approve for pension funds, unemployment benefits, and income security in the next recession, denial will morph into epiphany.
Gold is the right trade. Silver is the match that lights up the sector, so we'll have to wait for the ratio to shrink to 70:1 before fireworks occur, but we're getting really, really close.
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