What are the repercussions of a dwindling supply deficit
in the face of massive demand? As they say, shortages
beget more shortages as industrial users will likely
begin hoarding it if they haven't already been doing
so. It seems that is concerns develop that silver will
be unavailable, the situation could accelerate and
create some real issues. Do you envision that sort
of thing happening, and how would we know if we are
close to that?
I think we're starting to see it. There have been
several ... I call them tremors. There have been
several huge spikes in retail silver and gold demand.
That started in 2008. Of course, this all happened
after we had the first initial shock of the financial
system when we lost the total ... U.S. investment market
system totally imploded. We're talking Lehman Brothers
that was around since the Civil War. We totally lost the
investment banking market. It imploded. So did the U.S.
housing market as well as AIG. AIG stock went from $1,100
in 2007 to $30 in 2008. Investors need to realize how
quickly things can change. Another factor is how much
silver India has imported. So far, this year, India's
imports from January to May are up 61%. Here is the
clincher, analyst thought that now that new President
Modi has eased up gold restrictions, they thought they
would see a decline in silver imports in 2015, because
people would buy more gold. That hasn't happened. As
a matter of fact, they've bought 61% more gold.
Is an epic financial meltdown about to commence? Predictions
that a crash will occur in the fall of 2015 have been gaining
traction. They are bolstered by some of the market events of
this summer, which suggest that something big is indeed
unfolding:
The Good Lord gave a squirrel sense enough to save nuts and it
took 30 pieces of silver to make it so we all can make it to
heaven. Those two reasons alone are enough for me to buy as
much as I can get my hands on or fine. If you need another
reason the dealer in Louisiana has at least a 60 day waiting
period and not sure if he will be getting any then. I have
been buying from him for over 12 years now and never had to
wait before and I have bought a lot. PS I'm already in the
panic mode for silver. Thank you for having silver and
educating people on silver.
Physical Gold Flows East as Manipulated Paper Markets Lose Credibility
Precious Metals Market Update May 11th, 2016 Comments...
This spring, the center of gravity in the gold trading universe
shifted eastward. China’s Shanghai Gold Exchange launched a yuan-
denominated gold price fix on April 19th. The new Asia - centric
gold pricing mechanism highlights the fact that for many years
physical gold has been flowing from the West to the East.
Coordinated sales by Western central banks kept the gold price
suppressed from the mid 1980s through the early 2000s. Britain
infamously dumped half its reserves of gold bullion into the
market right at the bottom in gold prices (from 1999-2002)!
The U.S. government has ceased selling gold – at least officially
– because it is prevented by law from doing so.
However, many gold analysts believe that large quantities of U.S.
gold reserves have been subjected to lease or swap agreements
that call into question who really owns the bullion. (Using
these mechanisms, the U.S. circumvents the restriction on selling
America’s gold by borrowing gold from another country and then
selling that gold into the market....a typical Jewish market
maneuver)! Meanwhile, the government of Canada has sold off
virtually its entire gold stockpiles (but they still have
plenty of paper!). Earlier this year, a draw-down took Canadian
gold reserves down to a trivial 77 ounces – effectively 0% of
total reserves. At one point in the 1960s, Canada held over
1,000 tonnes of the yellow metal. Now, not even 1,000 ounces.
jewed
future-market.jpg (12.06 KiB) Viewed 11268 times
As gold flows out of Western vaults, it accumulates in Eastern
vaults and homes. India imports nearly 1,000 metric tonnes of
gold per year, mainly to satisfy jewelry demand. And even though
China is the world’s largest gold producer, domestic production
isn’t enough to meet the country’s own demand. China competes with
India for the title of world’s biggest gold importer. The People’s
Bank of China is widely believed to be accumulating more than
200 tonnes per year on its way to a total hoard of close to 4,000
tonnes. Reliable numbers are hard to come by, as China doesn’t
fully disclose its purchases. But so far this year, it appears
that China’s appetite for gold is being surpassed only by Russia’s.
Last year, the Central Bank of Russia added a record 208 tonnes
of gold to its reserves. It is on pace to accumulate at least
that much in 2016 (slightly more than China). Both Russia and
China are effectively de-dollarizing by replacing U.S. Treasuries
with gold and forming regional economic partnerships that bypass
the dollar. At some point, Shanghai may challenge New York and
London as the centers of trading activity for precious metals.
For now, though, the new Shanghai gold fix gives China greater
autonomy (it will no longer have to convert to a dollar price
in international transactions) and solidifies China’s regional
dominance in the gold trade. China is the world’s leading producer
and consumer of gold. Therefore, it makes sense that China wants
more control over the gold pricing mechanism. The current leading
gold benchmark is the London Bullion Market Association Gold Price
Fix. It emerged last year as a modern, electronic-based replacement
for the old London Gold Fix. The new system is more efficient and
no longer relies on a small group of backroom traders to set the price.
However, the problem of large-scale manipulation of precious metals
prices in London, New York, and elsewhere has not been solved. Far
from it!
In April, Deutsche Bank settled a U.S. lawsuit over charges that
it conspired with multiple banks to rig gold and silver prices.
The plaintiffs say individual investors were hurt. According to
Reuters (April 14, 2016), plaintiffs contended the German bank
"manipulate[d] prices of gold, gold futures and options, and gold
derivatives through twice-a-day meetings to set the so-called
London Gold Fixing." "They also accused Deutsche Bank, HSBC, and
ScotiaBank of a similar conspiracy to manipulate silver prices by
rigging the daily Silver Fix." By settling (for an undisclosed
amount), Deutsche Bank essentially admitted that it couldn’t refute
the allegations. On top of that, Deutsche Bank agreed to provide
evidence of the manipulation by other banks. The Chinese certainly
aren’t averse to interfering in markets either. However, there is
one critical difference between the Shanghai Gold Exchange and
futures markets in Europe and the America: The Shanghai Gold Exchange
processes transactions for physical metal. It’s a real physical market,
not a market for mere paper contracts.
really-jewed
not-good.jpg (22 KiB) Viewed 11268 times
In recent months, paper speculators have driven leverage on the U.S.
COMEX gold and silver futures markets to unprecedented extremes.
Registered inventories of physical metal have plummeted as the
number of paper claims on each available ounce has multiplied.
Paper precious metals markets are on the verge of losing all
credibility. If just a small percentage of the people who now
hold long paper contracts on gold and silver demanded physical
delivery, or sold their contracts into the market and used the
proceeds to buy physical, the buying pressure could lead to
physical shortages and price spikes. Perhaps the Chinese and
Russians foresee the day when physical gold will be difficult
to obtain and command a much dearer price. They – and all those
who hold precious metals in physical form – will be in the position
of setting the terms in the coming new Asia-centric monetary
and economic order.
I’ve recently had conversations with the former head of
the Federal Reserve, Ben Bernanke, and the former head
of the IMF, John Lipsky. Interestingly, they both used
the same term to describe the current state of the
international monetary system: “Incoherent.” That
(translated into Goyim) means there is no anchor
in the system today (meaning the BS is getting too
thick for the markets to absorb). There’s no gold
standard, no dollar standard, and no system of fixed
exchange rates. Every day is jump ball for currency
valuations. This is an open invitation to currency wars
and a never-ending race to the bottom. Now elites like
BIS Chairman Raghuram Rajan, and BIS Chief Economist
Claudio Bario are calling for new rules of the game.
This can only mean a system based on SDRs or gold,
which both result in an inflationary devaluation of
the dollar.
I’ve written and discussed the secret Shanghai Accord
for months. It implies higher dollar prices for euros,
yen and gold, and lower index prices for the dollar and
yuan. In the May issue of Strategic Intelligence we
presented a mathematical proof that the Shanghai Accord
is real. Yet, Wall Street economists and policymakers
kept denying that the Shanghai Accord exists. Now the
cat is out of the bag. In a candid presentation, a top
adviser to Japanese Prime Minister Abe admitted that
the U.S. will not tolerate a weaker yen. They yen is
up 10% against the dollar so far this year.
It’s one thing for analysts and economists to expect a
weaker dollar. It’s another thing when the guy who prints
dollars says they will weaken too. William Dudley is
President of the Federal Reserve Bank of New York. When
the Fed wants to print dollars it’s the New York Fed
that buys bonds from Wall Street primary dealers and
pays for them with money that comes from thin air.
That’s how dollars are “printed” in the digital age.
In this interview, President Dudley says, “energy
prices seem to have stabilized and actually increased
a little bit and the dollar has actually weakened. …
I am reasonably confident that inflation will get back
to our 2 percent objective over the medium term.” If
the guy who prints dollars is looking at a weaker dollar,
and more inflation, maybe you should too.
In December 2012, Japanese Prime Minister Abe announced
an economic recovery program that was promptly dubbed
“Abenomics.” This plan had “three arrows” consisting of
a cheaper yen, fiscal stimulus, and structural reform.
Fiscal stimulus meant smart spending on productive
infrastructure. Structural reform meant polices involving
labor mobility, empowerment of women, more immigration,
and the rationalization of Japan’s highly inefficient
retail distribution network. Three years later Japan has
made no significant structural reforms, and has not used
fiscal policy wisely. Only the cheap yen policy was
implemented. Now global monetary elites are saying,
“Time’s up.” Click here to read why the period of the
cheap yen is over; now it’s time for the cheap dollar.
With no structural reform, no fiscal stimulus, and no
more cheap yen, what’s left of Abenomics? Nothing.
Wade says," This is not Titanic boys and girls...this
is Gustloff."
every-man-for-himself
gustloffsinking.jpg (21.8 KiB) Viewed 11240 times
The global monetary elites had a conference in Zurich,
Switzerland last week. Among the speakers were William
Dudley, President of the Federal Reserve Bank of New
York, and Claudio Bario, Chief Economist of the Bank
for International Settlements. The topic of the
conference was the prospect of multiple reserve
currencies in the international monetary system.
The speakers generally agreed that a system with
more reserve currencies (such as the Australian Dollar,
Canadian Dollar, and possibly certain emerging markets’
currencies in addition to the Chinese yuan) would be
a desirable one. There’s only one problem. All of
the reserve currencies in the world add up to 100%
of the reserve currencies. If new currencies have
a larger share, then the U.S. dollar must have a
smaller share. That means a long-term process of
selling dollars and buying the new reserve currencies.
That selling lowers the value of the dollar, and imports
inflation into the U.S. It also means a higher dollar
price for gold. The elites won’t tell you that, but
I just did. Are you ready?
Wade finishes, "I wish I could say I was safe in her
arms....
gold-dust-woman
stevie.jpg (172.87 KiB) Viewed 11240 times
...but not to worry. She has her millions, and I have
my...er...well, I shall keep that to myself!"
With so much focus on the surge in precious metals, investors
are ignoring the dark commodities market for the most part.
Gold, silver and platinum prices are moving higher thanks to
investor anxiety about every issue imaginable, from lower-for-
longer interest rates to geopolitical uncertainty. But, while
bidding up metals prices, most are ignoring an entire swath of
the market: the dark commodities. These commodities are consumed
daily - whether it's copper for homes (or coinage)...
...appliances and cars or potash for fertilizer. What's more,
dark commodities and many others are still in bear market
territory. But with all the cheap money sloshing around,
cutbacks in production, mine closures and rationalization
in pricing, the same type of rally we've seen for precious
metals may soon be visiting this unloved sector. The latest
dark commodity to rally has been crude oil, which has almost
doubled in price from its lows. There are more profits waiting
to be made - maybe much sooner than investors think. For one,
cheap money is a stimulant for demand. Housing is booming in
the U.S., as is automobile production. In Europe, auto sales
are trending higher as well. While many consider the dark
commodity sector a "China" play, they forget that Europe and
the U.S. account for more than 50% of global GDP at close to
US$40 trillion. But the catalysts for higher commodity prices
may be even simpler than just the demand story. It's twofold
in nature. The first reason is supply cutbacks. At a recent
mega commodities conference, one CEO lamented that companies
in the industry (and his company specifically) would have done
much better had they not expanded over the past decade. Today,
they are closing mines, cutting back production at others and
selling assets to reduce debt. Another mining giant, AngloGold,
recently announced that it will lay off (Jews love to do this!)
almost 85,000 employees in the next few years and shut down or
cut back production on poorly performing projects. Global
potash giant Potash Corporation, out of Saskatchewan, also
announced major cutbacks in production and mine closures to
combat weak global prices. The graphic below illustrates that
these companies are in the early stages of capacity cutbacks
and late stages of mine closures, two precursors for a renewed
rally.
mining-rally-cycle.jpg (31.25 KiB) Viewed 11221 times
The second reason for optimism comes from uncertainty. The U.S.
dollar, which is the currency most commodities are priced in,
may be in for a rough ride come autumn this year. Political
uncertainty emanating from the U.S. elections may cause a
sharp decline in the dollar - much like it has in the British
pound, thanks to Brexit fears surrounding the possible departure
of the U.K. from the European Economic Union. In short, there
are all the makings of a dark commodities rally, and the fact
that investors have abandoned the sector only makes it more
bullish for a recovery. In the coming issue of Beyond the
Dollar (which will hit inboxes by the end of the week), I
share my pick for a potential double or triple from a $2
stock in the dark commodities space. Don't miss it... You
can sign up for your issue here. On another note, I will
be leading an almost sold-out trip to South Africa this
September for my friends over at The Oxford Club. If you've
been on one of their investment trips before, you know this
one has been planned to perfection with exclusive meetings
and excellent locales, as well as side trips like a safari
and a visit to Cape Town. The South African rand is super
cheap right now, and that means the potential to pick up things
like diamonds right from the source at excellent prices, just
to touch on one potential reason to join me.
Cheers,
Karim Rahemtulla
Wade chimes in: "Please view the attached pix. Note the
Shanghai Gold exchanged opened last month...
no-jew-s-fed-paper
gold-board.JPG (49.88 KiB) Viewed 11221 times
.......and gold is priced in every commodity imaginable...
EXCEPT Jew-S Federal Reserve Notes! The life-boats are
away GOYS and girls, and some of them are empty! Best you
fence-sitters out there take swimming lessons!"
We all know that China has been buying thousands
of tons of gold in recent years. China has also
expanded its gold mining output, and its gold
refining capacity. In addition, China has set up
a physical gold exchange and gold futures exchange
in Shanghai. Overall, China looks set to snatch the
“gold capital of the world” title from London. But
they’re not there yet. London is still number one
when it comes to gold trading. Now China has
decided to hasten the process by planting its
flag right in London’s back yard. China is buying
one of the largest gold vaults in London. Soon
China will have a stranglehold on global gold trading.
We’ve heard about efforts to audit the Fed and hold
the Fed accountable for its monetary policy for years.
But most of these efforts have easily been brushed
aside by the White House with some lobbying by the
Fed itself. Not anymore. Legislation sponsored by
Senator Rand Paul (notorious Jew-beanie-wearing-
Wailing-Wall-patronizer), son of Congressman Ron
Paul who led the “audit the fed” movement for decades
is coming up for a vote in a committee of the House of
Representatives this week. That’s just one step in a
long process. We’ll keep you updated on further steps.
For now, it looks like real progress is being made.
The Fed may no longer be able to print money
without accountability or oversight. It’s about time.
After “audit the Fed,” an “abolish the Fed” movement
may not be far behind!
One dilemma facing owners of physical gold is safe
storage. It should not be kept in banks because banks
will be closed when you most want your gold.
Understandably most people don’t want to keep it
in their homes for fear of home invasion, although
Governor Rick Perry once told me “the only people
in Texas who worry about home invasion are the invaders,”
because of gun laws there. But most people are not handy
with weapons. That leaves non-bank storage. But there
are issues with reputation, insurance, bonding and other
considerations regarding the vault operator. A few years
ago I discussed with Gov. Perry and others the construction
of a Texas state-owned vault that citizens could use without
fear of Federal or bank confiscation. Texas is immune from
most Federal action under the 10th Amendment to the
Constitution, and it’s not a bank. Nice to see that the
“Texas Fort Knox” is one step closer to becoming a reality.
Russia has outpaced even China so far this year in its effort
to acquire gold. For each of the first four months of 2016,
Russia has added an average of 15.5 tonnes of gold to its
reserves. If this rate of buying persists through the year,
Russia could acquire 187 tonnes of gold in 2016 alone.
China has been the second largest gold buyer so far this
year, and is still the leading gold producer in the world.
China and Russia are stockpiling as much gold as they
can before the price goes up.
It’s one thing when writers and analysts make the case for
gold. It’s another thing when the world’s wealthiest individuals
and savviest investors like gold and put their money where
their mouth is. In recent days, hedge fund superstar Stanley
Druckenmiller has come out in favor of physical gold, saying
the bull market in stocks is exhausted and gold is his largest
currency allocation. Central banks are piling on the bandwagon,
too. The chance of an interest rate hike in June is down to 4%,
while gold bullion for immediate delivery is up 20% this year!
When the gold standard window was closed in August 1971
by President Nixon, the yellow metal had already risen
from its fixed price of $35 an ounce to $42 an ounce.
Nine years later, in 1980, gold peaked in price: It
had soared to $850 an ounce, rewarding early investors
with a 2,400% return. Had I made such forecast in 1971,
would you have believed me? Well, mark my words today:
We will see gold's price setting record highs in just
a few weeks! If $8,890/ounce is a tough pill to swallow,
consider the prediction of Mike Maloney, a precious metals
investor and revered historian on monetary history and
economics... Mike has run calculations showing that if
history repeats itself — and gold covers the same portion
of the currency supply that it did in 1934 and 1980 —
we should see prices of at least $12,000 per ounce by the
end of the year! Other insiders are predicting around the
same price point: between $10,000 and $15,000!
Wade says, "Cry your heart out, Janet! You just can't
print this stuff up!"
"It'll be a race," he said. "Between us and China. Whoever
wins will control the reserve currency of the next 50 to
100 years." Yesterday, I wrote about a dinner meeting I
recently had. One of the most powerful figures in America
had invited me to dine at his table at the Metropolitan
Club in New York. I've dubbed the plan he told me about –
to exchange the Federal Reserve's bond holdings for gold –
the "Metropolitan Plan." Assuming the exchange took place
today, it would establish a new dollar/gold price of around
$10,000 per ounce. Could this really happen? I don't know,
of course. But the fact that such a plan exists and is being
discussed at the highest levels of America's financial
circles and politics is shocking to me. Honestly, the
meeting left me speechless... and shaken. When I got
back to my office, I did what I would want you to do
for me if our roles were reversed... I got to work. I
sent two of my best analysts to Vancouver and set up
meetings for them with our best contacts in the gold-
mining industry. I got on the phone with half a dozen
friends who have been in and around the gold market
for 30 and 40 years. I looked up an old friend –
someone I believe is the best gold-stock analyst
in the world today – and offered him almost $4
million to work exclusively for us. The point
is, given all of the things I already know about
the risks to our currency and the global paper-
currency system, this meeting and the Metropolitan
Plan were an urgent wake-up call for me. Let's
start with what I believe is the most important
part of the Metropolitan Plan for you to understand.
Why would the government want to tie the dollar to
gold again? Wouldn't that drastically limit its
power and financial flexibility? The only reason
the government would tie the dollar to gold again
would be to immediately re-establish the credibility
of the currency and stop a global "run on the bank."
But how could the dollar possibly fail? Our economy
is immense and resilient. We control the world's
most powerful military – which is distributed across
more than 100 different countries. Why would anyone
want to sell the dollar? It's true that the dollar
is by far the strongest of all the world's paper
currencies. But this strength is also a tremendous
weakness. The ubiquitous status of the dollar is a
kind of Achilles heel. You see, the vast majority
of U.S. dollars are held overseas. According to
the Federal Reserve, roughly half of all $100 bills
are held overseas – almost $500 billion worth. Foreign
demand for $100 bills since the fall of the Berlin Wall
has caused production of $100 bills to soar. Far more
$100 bills have been printed than any other denomination.
c-notes-ouside.JPG (35.18 KiB) Viewed 11024 times
Of course, it isn't only cash that is being held overseas.
Foreign banks hold trillions in dollar-denominated bonds.
The top five foreign holders of U.S. Treasury bonds (China,
Japan, Ireland, Brazil, and the combined members of the
Organization of the Petroleum Exporting Countries) have
$3.1 trillion in dollar-dominated bonds. And those are
just the major holders. The U.S. dollar is the currency
of choice for banking reserves in almost every nation
in the world. And then there are the big foreign accounts
of U.S. corporations, which hold more than $2 trillion
overseas. Adding up only these big numbers... you can
see a huge amount of dollar currency and debt ($6 trillion
- $10 trillion) is held overseas. And that's not to mention
foreign-held U.S. real property, like real estate, stocks,
and corporate bonds – all of which are denominated in U.S.
dollars. Unlike, say, Japan, where almost all of the
currency and government debt is held locally, the U.S.
dollar is the de facto global currency. In the event of
a bona fide global bank run, it won't be possible for
the U.S. government to simply shut down the banks and
halt the panic. Almost all of the "banks" are overseas,
and almost all of the currency is held overseas. That's
the huge difference between today and the last time our
government defaulted on its obligations (back in 1933).
Wouldn't that make you wonder about the future purchasing
power of those dollars? And besides, who in his right mind
would own any government bonds that charged investors to
own them, guaranteeing losses? Who would pay for the "right"
to own a bond that pays no interest and is denominated in
a currency whose value can't be controlled and isn't backed
by any fungible commodity? Someday, historians will look
back on today's negative interest rates and be amazed that
such conditions could have existed. This sovereign bond bubble
is truly the greatest mania in the history of finance. But
we might not even need negative interest rates to spark the
panic...
Executive_Order_6102.jpg (190.71 KiB) Viewed 11024 times
Just imagine what might happen if a major presidential candidate
began telling global media outlets that America was heading
for a massive economic crisis and that now was a terrible time
to buy American companies or other U.S. assets. Imagine if this
candidate began calling himself the "Lone Ranger." Imagine if
he promised to eliminate all U.S. government debt, most of
which is owned by foreign (Jew) investors. Actually, you don't
have to imagine. That's exactly what Donald Trump recently
told the Washington Post. You can bet millions of Americans
– who don't understand anything about our currency's dangerous
dependence on foreign investors – will cheer these promises.
But what will the world's largest banks, the biggest insurance
companies, and the wealthiest families think about these promises?
How will the world's black markets for drugs, guns, and money-
laundering – all of which use $100 bills – react? It's a safe
bet that all of these hard-nosed foreign holders of our currency
would rather own gold than a U.S. dollar that's subject to
negative interest rates, new trade restrictions, capital
controls... or outright repudiation from the "Lone Ranger."
Believe me... these folks won't wait for a panic to move out
of the dollar. They're selling as fast as they can, which
explains the huge move in gold we've seen so far this year.
But this is only the beginning... The Metropolitan Plan
(swapping the Federal Reserve's paper holdings for gold)
is the only way the U.S. government can stop a real, global
dollar panic. It's the only way to regain the dollar's
credibility with overseas creditors and dollar holders.
Fortunately, the U.S. government owns the world's largest
gold reserve. That's a huge weapon it can use, if necessary,
to stem the panic. But you should know something... The
Chinese understand this game. And nobody is buying more
gold than the Chinese...
hong-kong-graph.JPG (38.67 KiB) Viewed 11024 times
This is the Achilles heel of our currency that most people
don't understand... and that many of our policymakers won't
see coming. In the event of a real run on paper currencies,
the U.S. government won't be able to stop the panic by simply
closing domestic banks and stock exchanges. It doesn't have
an easy way to stop the panic because so many of the dollars
are held overseas. Meanwhile... it should be pretty obvious
to any rational person that sooner or later, millions of people
around the world who hold dollars are going to begin to doubt
the safety of their savings. After all, when just about every
major bank in the U.S. was at the point of insolvency, the Fed
simply printed almost 4 trillion new dollars to bail out the
system. Wouldn't that make you wonder about the future
purchasing power of those dollars? And besides, who in his
right mind would own any government bonds that charged investors
to own them, guaranteeing losses? Who would pay for the "right"
to own a bond that pays no interest and is denominated in a
currency whose value can't be controlled and isn't backed by
any fungible commodity? Someday, historians will look back
on today's negative interest rates and be amazed that such
conditions could have existed. This sovereign bond bubble is
truly the greatest mania in the history of finance. But we
might not even need negative interest rates to spark the panic...
Just imagine what might happen if a major presidential candidate
began telling global media outlets that America was heading for
a massive economic crisis and that now was a terrible time to
buy American companies or other U.S. assets. Imagine if this
candidate began calling himself the "Lone Ranger." Imagine if
he promised to eliminate all U.S. government debt, most of
which is owned by (Jew) foreign investors. Actually, you don't
have to imagine. That's exactly what Donald Trump recently told
the Washington Post. You can bet millions of Americans – who
don't understand anything about our currency's dangerous dependence
on foreign (Jew) investors – will cheer these promises. But what
will the world's largest banks, the biggest insurance companies,
and the wealthiest families think about these promises? How will
the world's black markets for drugs, guns, and money-laundering –
all of which use $100 bills – react?
Wade says, "For the benefits of the Feds who read these public
'Net forums...I have only used $50s..and even those are getting
scarce as the teeth of hens!"
It's a safe bet that all of these hard-nosed foreign holders of
our currency would rather own gold than a U.S. dollar that's
subject to negative interest rates, new trade restrictions,
capital controls... or outright repudiation from the "Lone Ranger."
Believe me... these folks won't wait for a panic to move out of
the dollar. They're selling as fast as they can, which explains
the huge move in gold we've seen so far this year. But this is
only the beginning... The Metropolitan Plan (swapping the Federal
Reserve's paper holdings for gold) is the only way the U.S.
government can stop a real, global dollar panic. It's the only
way to regain the dollar's credibility with overseas creditors
and dollar holders. Fortunately, the U.S. government owns the
world's largest gold reserve. That's a huge weapon it can use,
if necessary, to stem the panic. But you should know something...
The Chinese understand this game. And nobody is buying more
gold than the Chinese...
This is hard to prove, of course. The Chinese government doesn't
advertise how much gold it's buying. Bloomberg estimates its
holdings grew from around 1,000 tons of gold in 2010 to 3,500
tons by the end of 2016. But... it could be a lot more. Almost
all of the gold that China imports comes through Hong Kong,
which reports trade data. Since 2010, almost 5,000 tons of
gold has passed through Hong Kong into China. And it's against
the law to export gold from China, so in addition to all of
the gold it has been buying, China is also keeping all of the
country's domestic production. Given these facts, it wouldn't
surprise me to learn that China already has close to as much
gold as we do (a bit more than 8,000 tons). Given the size of
its economy, it probably has more gold than we do on a relative
basis, meaning that it would be possible for China to use gold
as its currency reserve, too. And... why would it? Again, no
government would choose to limit its power or its financial
flexibility by tying its currency (and its debts) to gold.
But in a race to stem a global panic, in an effort to re-
establish the credibility of their banking systems and
currencies, governments have no great "trump card" to play.
According to my Metropolitan source, in the event of a global
currency crisis, there would be a "race" between the U.S.
and China to tie their currencies to gold and establish the
world's most elite and stable currency. Doing so would mean
controlling the world's reserve currency for the next 50 years
or more. These ideas are very important. They're important
enough for me to risk the ridicule and the suspicions I was
sure would erupt. Writing about gold, even in general terms,
is bad enough. I don't want to spend the rest of my life arguing
with conspiracy theorists about how much gold is in Fort Knox.
(For the record, I don't know. My Metropolitan Plan source
appeared to believe the auditors.) I'm not advocating selling
everything you own and buying gold and ammunition. I'm simply
telling you that a crisis is coming. I've spoken to many of the
world's foremost experts in economics and financial history.
There's no question that we're approaching a major financial
reckoning. Whether it's simply a serious credit-default cycle
or the collapse of the global paper-money system... nobody
knows. Not me. And not my source for the Metropolitan Plan.
So please... before you bash me... before you accuse me of
making all of this up... or of becoming a "pawn" in some
elaborate scheme to push up the price of gold... just think
to yourself: Either the ideas and the proof behind them make
sense or they don't!
Wade says, "Get it while you still can! JPMorgan's Jamie
Dimon and his fellow shabboz-goys (along with you-know-who)
have been pushing the price of the stuff down over the last
two days to shake out the paper longs and slackerds! Take
care and be well! Thank you Mister Spock!"
