| firstname.lastname@example.org |
Prior dewdrops of wisdom from the illustrious Sage of Wexford
are retained for posterity below:
NEWS FROM THE FRONT - December 18,
It was the week before Christmas and all through the land,
Not an asset was avoiding the Fed's tightening hand,
The Banksters were hung from the yardarm with glee,
In hopes that Money would once again be free.
Couldn't resist flexing my poetic prowess. Janet, history will
not be kind to this overwhelmed Fed Chair, finally pulled the
trigger with a whopping 25 basis-point increase in the Fed Funds Rate
this week, and the stock market went on its usual heroin-induced "we
don't give a damn rally" BEFORE REALITY SET IN THAT THE TREND IN
INTEREST RATES, BELATEDLY AT THE SHORT-END NOW, WILL BE HEADED
HIGHER AND HIGHER IN THE MONTHS AHEAD. Intermediate to
Long-term rates have been moving higher around the world for months
This is a sea-change event, my loyal
readers. The Age of ZIRP is now officially
dead, and those cheapskates at banks across the nation are going to
have to pay us now for the use of our money, even if we couldn't buy
a week's worth of groceries with the annual interest income.
But that is now. Wait another 12 months, and we will finally
be earning some interest income to buy more gold and silver with.
As always, since my aged, tired and beaten up fingers ( from DIY
auto repairs! ) are no longer inclined to write as much as in days
of old ( plus I am tired of listening to the same old blather ), I
highly recommend that you read David Stockman's ContraCorner musings
if you want an erudite exposition of what's what in Fantasy Land,
2015/2016. I make sarcastic comments there all the time in
support of David's positions, and since we have the same first
names, I know that he is usually spot on in his analyses. Just
this week, in the comment section to a superb Stockman treatise,
Could not find the uber-short 90-day Treasury graph after three
glasses of spiked eggnog, but this graph is even more telling: the
U.S. Fed has a history of panicking and making money virtually free,
see 1958 & 1962-1963. Wow!
This graph also shows we are at the end of a mega-cycle in interest
rates. Do you really think that inflation is less than 2% currently,
as Janet does??!! Try over 8% on Main
Street for us commoners who buy our own food and energy.
Energy's decline is a one-time event that has no impact to the rate
of price changes going forward, and there are plenty of other
every-day costs that are going up significantly like healthcare
premiums, taxes at all levels, and food costs up the kazoo.
Ah, Eureka, HERE IS A GOOD, 90-Day Treasury graph:
THE SAGE'S SPOT-ON COMMENT:
The historical graph of the 90-day Treasury Bill rate
tells it all, put your hands over your ears when Janet starts
babbling. Normal, market-driven, demand for money would have gotten
this rate off the mat years ago where it not for the Fed's constant
tinkering AND FOR THE LACK OF OVERALL DEMAND. Even with Trillions in
balance sheet expansion at the Fed, the global debt markets are so
huge that true demand for the ingredients of production of goods and
services would have levitated intermediate and long-term rates
despite the Hamster Wheel activities of the Fed.
The demand was never there in a world already drowning in
non-serviceable debt. The free money supplied by the Central
Banksters merely went into speculation because that is where easy
profits could be made, not in the production of goods and services
for resale where only cost reductions and stock buy-backs boosted
the bottom line. Without growth in final demand and rising revenue
streams as a result, there is no sustainable growth in world
economies or profitability. It was all smoke and mirrors, a Wall
Street, Fifth Avenue condo recovery and nothing else.
Now the tide has gone out and rates will increase as
one giant hairball default after another coming rushing down the
pike. Janet might as well go play golf with the retiring Obama.
Their scores at golf will surely be as good as their scores at
economic machinations. It matters not what the Fed focuses on going
forward. The real market of money pricing is back with a vengeance,
and ALL DIRT CREDITS ARE GOING TO BE PRICED ACCORDINGLY. And that
means interest rates at the long-end well north of 8% before the
winter of 2017.
Buy that which others currently shun, and I am not talking about
stocks, bonds, or real estate.
What good advice this commentator gives! And these elusive
assets of which I speak of course are gold, silver, and colored
diamonds. I always include the latter asset class, not because
I have been selling them for over 13 years now, but because they
have done much better than the precious metals over the last 7 years
of Gold/Silver price manipulations by the likes of Goldman and JP
But even though the Sage has been wrong for several months (
years?!! ) now about the exact bottom in both Gold and Silver having
been achieved ( and I dare to say I think this is the time now, but
who is listening at this point??!! ), I have never lost my faith in
these Real Money Assets that can't be manufactured at will by any
crazy Central Bank. The record sales of American Eagle Silver
coins from the U.S. Mint for 2015 speaks volumes (no pun intended)
about the pending direction in both gold and silver prices.
Physical demand always trumps paper instrument trading over time (
The Donald let me use his name in this sentence for $25. )
Bad things are going to be happening to
financial assets and real estate and the global economy, loyal
partisans, and very good things are going to be happening to assets
that act as hedges, historically and NOW, against Collapse, Turmoil,
and Grave Uncertainty. Merry Christmas on that note.
There has been no economic recovery for the
average American. Tell this to your elected
officials, and make sure you voice your displeasure when you go to
the ballot booth.
Retail stock investors have been moving to cash ( they must read
these pages! ) for almost 2 years now because they know that the
financial markets are rigged, and the big boys are just manipulating
prices to suck the last dollar from the uninformed
person-on-the-street. At this point Americans just want their
two front teeth for Christmas! The have had their originals
kicked out by those that have been elected or appointed to serve
them. Revenge will be sweet, although I know that thought is
Christmas to All and To All A Good Night!
The politically incorrect Sage of Wexford. 17 years of selling
and buying Precious Metals to thousands of very satisfied clients
who will still have a nest-egg when the dust settles.
NEWS FROM THE FRONT - January 12, 2016
Happy New Year to all, and we have certainly started off with a
bang. The Sino Bang that is one of the most over-valued stock
markets in the world, the Shanghai Exchange, has lost a mere 14.6%
since ringing in the new year. The vaunted S&P 500 has wiped
out any return provided in 2015 with dividends reinvested with a
2016 decline of 5.3%. Not a good start to a year already on
sinking economic fundamentals.
I think a certain Sage of Wexford pointed out that China may be the
domino that gets the Debt Collapse, Phase II, going, and that
certain pundit is taking a timid bow off of stage right.
But I must say that I am more concerned about the world's future
today than at any time in my over 6-decade long life. This is
not fear-mongering for the sake of drama or as a marketing angle, as
my long-term readers know I have served a pretty useful purpose over
the last 17 years in attempting to read the lay of the land to their
financial benefit. And although bullion purchases over the
last 4 years may not have generated a positive return, YET, the
possession of both Gold and Silver mean that you will have this Real
Money Insurance as the dark days ahead unfold. And the storm
clouds have not just gathered, they are spewing forth thunder,
lightning, and flooding rains to the detriment of the mortals
Debt Collapses are always a chain of sequential events, not a single
implosion as one might expect. Granted, a single event may
greatly exacerbate the situation and accelerate the collapse, but it
is like a string of Chinese fireworks going off in the street in
celebration .......... one firework after the other until the
pollution gauges in Beijing and Shanghai go off the scale.
First the struggling Chinese worker can't breath the air or drink
the water. Now, he or she cannot get their hard-earned money
out of the collapsing Chinese financial markets. When a
singular country, albeit one centrally planned and centrally
manipulated, is touted as the greatest growth story in the history
of man, one had better look below the covers to see if the Emperor
has any clothes or not! And the current Chinese Emperor, the
Communist-Run Quasi-Capitalistic System of 2016 China, is a streaker
if there ever was one.
The Chinese Miracle since 2008 is fraught with so much expansion of
credit that will never be repaid to the Government and domestic or
foreign investors that a Yellen, or Bernanke, or Greenspan would
blush as to the shear magnitude of debt creation and the utter lack
of creditworthiness of the recipients of same. I think a
rice-paddy oxen got a $100 Million loan just the other day.
But there is no shortage of Americans, Europeans, and other Asians
that are holding the soon-to-be-vaporized paper of these
Sino-Credits via mutual funds, ETF's, and other highly-touted
financial vehicles that are headed for the cliff of default.
Is it any wonder that the Chinese Government in 2015 had a net
reduction in foreign currency reserves?! Not only is their
export-dependent economy suffering the fate of gross over-capacities
in virtually every Sino industry, but the Yuan has had to be
devalued by the Central Planners in order to keep trade from being
any worse than it already is. It is no secret that the Chinese
have been selling U.S. Treasuries to obtain liquidity to fight
current and future fires that are financially and economically
springing up in the country like scandals for the 2016 Hillary
campaign. This pouring of Dollars into the global currency
market will eventually put a lid and then a downward slope on the
Greenback as other sinking exporters sell Treasuries and convert
them quickly into local currencies to fight domestic crises that are
mushrooming by the hour in Brazil, Venezuela, Greece, Spain,
Austria, Ireland, Italy, and Russia, to just name a few.
The only thing holding the Dollar up is the rapidity with which
other countries' economies and prospects are sinking into 2016, the
audacity of the U.S. Government in putting out false narratives &
outright lies, and the perception that the U.S. Fed is on a 4 to 5
times rate increase cycle this coming year. Not sure these
overpaid charlatans have the guts to raise rates much more this
year, but the "normalization" cycle that they just started with a
whooping 25 basis point hike may be needed to save the Dollar from
its crumbling fundamentals and $160 Trillion of un-payable United
Stated unfunded obligations. Stranger things have happened.
Who would have thought in the Spring of 2009 that we would be at
Zero Interest Rates for some 84 months during a purported economic
recovery. Only the banks, Wall Street, and sub-prime borrowers
have benefited from this failed strategy.
The Obama Non-Recovery and the Obama Depression are now recorded, we
must give credit where credit is due in celebration of the bows to
be taken this evening in the final, thank God, State of the Union
Address by this grossly unqualified and dishonest, unlawful
President. Hate to be political in this missive, but this
player has contributed greatly to the recent demise of the American
system, if not to the disharmony among the populace. History
will not be kind to his memory as the worst depression the world has
ever seen unfolds before he can pass the hot potato on to the next
In closing, the precious metals are base building. Buy when
you have the dough because I am as convinced as ever that at some
point down the not-too-distant road, neither gold or silver will be
available at virtually any price. Sounds like I am being
dramatic again, but it has happened before and will happen again.
Harkin back to the Fall of 2008 for recent bullion
Once again ...... Happy New Year!
Sage of Wexford, more right than wrong for going on 17 years now.
Courtesy of StockCharts.com
|The Shanghai Stock Exchange Composite
Index is headed for a near-term retracement from its
all-time high of some 50% before the crocuses sprout in
the Spring, and a 70% to 80% retracement would not be
unexpected in the unfolding Obama Depression.
Stock markets fueled by speculation and record leverage
are destined for equally spectacular bear markets that
not only wipe out all of the bull market gains, but
financially ruin the vast majority of retail investors
in the process. GET THE MESSAGE? There will
be riots in China before long.
Courtesy of StockCharts.com
|U.S. stock investors today are back
at the level they were first at in June of 2014!
Some 18 months of going nowhere while the economy heads
unquestionably South. Take a very good look at
this chart. IT IS THE CLASSIC PATTERN OF A BULL
MARKET TOPPING OUT WHERE THE BREATHTAKING DECLINES ARE
BECOMING MORE FREQUENT, MORE DRAMATIC, AND MORE DEADLY.
How much of your retirement savings are in U.S.
stocks??!! Walmart Greeters apron is in the mail
to you. How much do you have in Gold and Silver,
physical only? If you say 30%, a Shakespeare
fishing outfit is on its way.
NEWS FROM THE FRONT - February 13, 2016
Ah, the perfect date to be writing about the
Central Bank/ Government Debt Collapse we see unfolding before our
startled eyes! Hopefully, these dewdrops of Sage wisdom will
serve you well in getting you out of the way of the AVALANCHE OF
FAILURES above you on the Mountainside of Debt and Failed Government
I will turn to Gold and Silver price action first before I rant and
rave about the harm our elected and unelected overpaid officials
have done to us simple village people. Both precious metals
have formed a strong "V" bottom in price after an extended bear
market that started in the summer of 2011.
Usually, such an abrupt bottom formation is
suspect, and prone to retest the previous lows which would be
about $1072 in Gold and $13.58 in Silver, but these are hardly
"normal" times in any market or in any global economy. To
act as though things are "normal" today could cost you dearly in
the years ahead.
So Gold is up 15.6% from its bear market low and Silver is up
16.7% from its low; year-to-date, these two monetary metals have
beaten just about every asset class with a 16.7% YTD gain for
Gold and a 14.7% YTD gain for Silver. I think waiting for
a secondary low, if it indeed ever happens as the wheels fall of
the global cart a la Deutsche Bank and Chinese banks, is like
playing on the railroad tracks in assuming "normal" price
patterns are going to still exist. Remember too that J.P.
Morgan - Chase has a physical and paper position in Silver that
is multiples of what the Hunt Brothers almost went to jail for
via "market cornering" or "rigging", but they are big political
contributors so they may be as safe as Hillary may be with a
Democrat/Obama-appointed Attorney General. Big Money does
buy Big Influence.
I think you have no alternative in
order to accumulate physical Gold and Silver (forget the
fricking ETF's, there will be an audit any day now for several
of these paper tigers that shows
the cupboard is partially bare or with metals HYPOTHECATED out
of reach with an executive or two now out of the country), but to be a buyer practically
at any price now. REASON:
THE MONEY YOU HAVE IN BANKS, READY
TO BE DEPLOYED IN BULLION, MAY NOT BE AVAILABLE IN THE WEEKS AND
MONTHS AHEAD AFTER A BANKING SYSTEM WORLDWIDE COLLAPSE.
European banks are destined to employ bank BAIL-IN's of up to 30%
of depositors' money, and the 8 to 10 largest U.S. banks like CitiBank, Bank of America, and Wells Fargo are going to restrict
funds transfers out for some period of time versus a
full-fledged Bank Holiday with their doors physically locked
shut. Me, the Lowly, Know-Nothing Sage, having funds
temporarily at some of the institutions named above, merely
parked waiting for deployment with my knees knocking together
since I could not choose the custodians' banks,
started getting them "deployed" this very week.
I have never been a particularly astute market-timer anyway, so
bullion in hand is far superior to money in the banks!!!!!
MARKET TIMERS, ESPECIALLY AT THE END OF A BRUTAL BEAR
MARKET, HAVE A HABIT OF GETTING LEFT AT THE STATION HOLDING
THEIR PRIVATES (vs. holding metal!).
I personally feel that Deutsche Bank is going to implode any
moment now, and the Daisy Chain of Derivative Ownerships (DCDO)
is going to bring one bank, trading firm, and investment house
down after the other when Deutsche goes. As I have said
previously in these erudite pages, this is the first time in my
long life that I am genuinely fearful of the future. Being
prepared for bad times is not the same as enduring them.
If you want to have a large cash reserve, I suggest you take it
out in rotting currency that you can bury in the backyard or
other clandestine spot. Some have mocked me for suggesting
same. Granted, the Dollar is a
depreciating currency, just see what the Japanese Yen-Dollar
cross has done of late when one would have expected negative
rates in Japan to devalue the Yen, not the opposite! When
you have huge, unprecedented positions such as the Yen Carry
Trade unwinding, with scads of spooked traders who are getting
their clocks cleaned in these positions, you have
counter-intuitive demand for another rotting currency, the Yen.
I think Japan has a Total Debt to GDP of around 250% and
climbing, so would this be the currency you would buy in the
midst of a global depression and debt collapse??!! ME THINKS
NOT, CERTAINLY NOT IN "NORMAL" TIMES.
And lest me wind up this missive without giving a shout-out to
Janet Yelling for the absolute, unmitigated nonsense that she
spewed forth at this week's Senate Feel-Good Ceremony on
Clueless Hill: Solid job market, growing financial market
threats to growth (oh, really! with bank balance sheets and
stock markets plunging around the globe!), 2% inflation targets
(pulled from you-know-where!), rate increases based on the data
(what else? chicken entrails?! ), negative rates in study
(we will see how soon they put Deutsche Bank in the crapper
along with other no-liquidity Euro-Banks), low unemployment rate
of 4.9% (no mention of discouraged or under-employed that are
twiddling their thumbs each day), and, generally,
WE HAVE YOUR BACKS, NOT TO WORRY.
Here we insert a picture of Alfred E. Newman of MAD MAGAZINE
fame with flies buzzing around his head and a George Bush
expression of incredulousness that a child would pick up on.
Janet, Ben, and Alan, don't spend all of those ridiculous
speaking fees. I plan to launch a class-action lawsuit
along with 20 Million other Americans (only ones that have
positive account balances) ON YOU GUYS HAVING STOLEN MY INTEREST
INCOME OVER THE LAST 7 YEARS.
So remember the submarine war movie, DIVE, DIVE, DIVE. In
the precious metals markets, you are now watching the movie,
BUY, BUY, BUY. If you think an ETF can substitute for the
real thing in your possession, I will hire Janet Yellen to be
your personal financial advisor. Comes with translator.
STRAPPED TO THE BULLION
MAST IN CRUISE SHIP SEAS,
THE EVER OBNOXIOUS, YET LUCID
....... THE SAGE OF WEXFORD.
Duh, Janet, where is the improving economy?? The American
Consumer is plain tapped out, folks. Zero Cost Money ain't
going to change the Burden of Peak Debt & poor income
or job prospects. Add in Loss of Confidence.
Would bet Janet's next paycheck that this downward trend in
Full Retail Sales, including Autos and Food, goes negative in
the First Quarter of 2016 as financial markets & economies
crumble before our very eyes.
NEWS FROM THE FRONT - March 18, 2016
The question on every bullion buyer's lips right now is whether he
or she should buy more Gold and Silver right this minute or wait for
a 40% retracement of the recent moves off the December lows.
With Gold up a shiny 18% year-to-date and Silver close behind with a
15.7% gain, normal technical analysis would suggest waiting for the
much-talked-about pullback (possibly too-talked-about!) to add to
your Bomb Shelter Portfolio. Commercial Short positions also
argue to be cautious in here, but these insiders have been
liquidating some of these shorts and going long as the bullion
market has continued to advance against their usually spot-on
timing. Normally, you don't bet against them.
But these are hardly normal times when the Newbie Chair of the
Federal Reserve nervously states that there are risks to the economy
and financial markets SHOULD SHE PULL THE
LEVEL FOR A LILLIPUTIAN RATE INCREASE OF 25 BASIS POINTS.
The immediate question becomes: "If the economy and
financial markets are that fragile, THEN THE TOP MUST BE IN FOR
Those more in the weeds of Leveraged Speculation than Humble Moi
will state that even 25 basis points will tip the scale such that
100x to 1 leveraged positions in interest rate swaps, cross-currency
positions, YEN carry-trades, and $Trillion hedges on "if the chicken
actually crossed the road" WILL IMPLODE AND COLLAPSE THE SYSTEM.
Then we truly are in Duck Soup as Janet's sweaty brow conveyed, not
to mention the slight tremor in her speech and her overall NERVOUS
body language. She needs to go to the Greenspan/Bernanke
School of Acting for Central Bankers!!!
So all is not well in Mudville, natives, and it is time to head for
the hills. Buying a new home right now would be like buying
the Dow right now that finally managed to go into the Year-to-Date
Green Column yesterday after 77 days of 2016 have expired.
BUY THIS DEAD-CAT BOUNCE (no offense to Felines!) IF YOU MUST, BUT A
FOOL AND HIS OR HER MONEY IS SOON PARTED! A telling signpost
This is what drives stock prices above all else, Newbie Stock
Experts! More than cheap money, more than Wall Street
cheerleading, and infinitely MORE THAN fudged stats and falsehoods
out of the Washington bureaucratic maze, it is all about growth in
EPS to feed the P/E monster, and Corporate America has never, ever,
ever been more IN DEBT & DEEP DOO-DOO than they are today after
gouging on stock buy-backs since 2009. That game is over,
folks, as cash-flow goes negative to service the record mountain of
debt they already have! And no CapEx recovery is coming
either, because you do not add to physical plant when your earnings
are headed South along with your sales.
Speaking of Sales, take a gander, maybe after a stiff shot of
something, to this record breaking GAP in wholesale inventories to
A new ALL-TIME record GAP of some $155 Billion is sitting on
warehouse shelves, in vehicle manufacturers' lots, and in new home
developments across the country waiting for a buyer who is now
scared as heck as to what the future may bring!
BEATS THE GREAT RECESSION LEVEL IN LATE 2008
AND EARLY 2009 BY SOME $25 BILLION, break out the champagne,
gullible stock chasers. We are already in recession, folks,
and it is just a matter of literally weeks before the Default
Avalanche gets going down the Debt Mountain in acceleration mode.
Mixing metaphors, all high-flying airplanes loaded with bad fuel
such as ZIRP or NIRP or truly Idiots-Behind-The-Helm go into stall
speed before they plummet back to earth. We are not only
stalled, we have already tipped over, and are now accelerating to
the downside. Phase II, the Greater Depression is one we will
never forget with some $60 Trillion in new debt added to the Global
Landscape since 2009; NOTHING has been solved around the world since
the Lehman Collapse. More debt to the fire has only made things
worse, and 2016 & beyond economies/financial systems will be worse
than in 2008/2009 this time around.
So, circuitously as usual, I turn back to my original query above,
"Is now a good time to add to Precious Metals positions, even after
this big run-up?". I say "yes" because I have wait-times to
shipment dates on more and more products every day, and the physical
supply of Gold and Silver around the world is increasingly well
short of almost ravenous demand. WE ARE VERY, VERY CLOSE TO
A WAVE OF PANICKED BUYING IN BOTH GOLD AND SILVER.
Do what you are comfortable with as to timing and quantities of
Wasting Dollars finally put to productive use, but do not put things
off too long. Market timing is a substandard investment
approach compared to being in the right market for the nova-bull
move, AND GETTING OUT OF THE WRONG MARKETS PRIOR TO THE WEALTH
do get out of stocks and bonds and don't even think of buying
that new home because you are tired of that "old" one or the
funky neighbors. Much better prices will be had for all of
those assets in the next 3 to 5 years. Stay put
physically, stay patient, AND DO GET AS MUCH MONEY OUT OF THE
BANKING SYSTEM AS POSSIBLE AND PRACTICAL. This global
financial system is more toxic and compromised than ever in our
geologically short time on earth.
Sage of Wexford,
sometimes gut feelings carry the day.
Production grinds to a halt in month's ahead as businesses
attempt to adjust inventories to recessionary sales declines.
NEWS FROM THE FRONT - April 16, 2016
Now that you have sent a goodly percentage of
your income to Washington for its misallocation of resources, we can
turn to the state of the Precious Metals markets which are doing
much better than the governance of our country. Both Gold and
Silver have been consolidating their 2016 gains over the last
several weeks, and Silver in particular has broken above key
resistance at $16 per ounce with conviction. There, of course,
is no guarantee in the world of investing that this new bull-market
uptrend is infallible, but this price action, even while Gold was
somewhat uninspiring, is quite a testament to the strength of both
bullion markets. There has been no "predicted" sell-off to
date, and as time progresses along with price, the probability of
such a retracement to the lows becomes more remote.
Gold may break out any day now to confirm Silver's move, but I would
not be a fence-sitter at these levels because the
Bernanke-Obama-Yellen (BOY) Bubble is imploding as my nimble fingers
fly across the keyboard today. It is quite likely that the
White House visit of Janet Yellen, another real-world challenged Fed
Chair, this past week was partially due to the impending bail-out
required of Deutsche Bank in Euroland which may entail the use of
freshly printed U.S. Dollars from the Fed to assist in the assist.
Of course, stock and bond investors of this monster German bank will
take it on the chin first, but one has to wonder if the lever
pullers will employ the Bank Bail-In regulations passed post-Lehman
that give haircuts to underinsured depositors along with traditional
investors in the bank. Stay tuned. Maybe to avoid the
inevitable panic that is just around the corner anyway, the Central
Banksters will refrain from doing so a la Cyprus-style, but this
tactic in the ECU bag of tricks to milk taxpayers one way or the
other was not legalized for nothing.
I makes my blood boil that Bernanke sent $Trillions of electronic
credits to the Europeans post-Lehman to keep U.S. banks afloat based
on their extensive European exposure at the time, but for Yelling
Janet to do so 7 years PAST THE FRICKING CRISIS with unauthorized
U.S. taxpayer funds is the final straw. The U.S. Federal
Reserve either needs to be severely restricted in its use of the
printing press and unauthorized creation of U.S. liabilities, or
abolished all together. NEVER HAVE SO FEW WITH SO LITTLE
KNOWLEDGE OF SO MUCH DONE SO MUCH HARM TO SO MANY PEOPLE OF THE
EARTH IN SO SHORT A PERIOD OF TIME. This grossly failed
monetary experiment on a gargantuan scale has totally failed to
trickle down economic growth to the citizens of the world.
THERE WILL BE REPERCUSSIONS.
The global economy continues to soften virtually
without interruption to the downward trend. I will incorporate
some very telling charts within this missive, but monthly data on
Wholesale Inventories, Orders, Retail Sales, Auto Sales, Tax
Receipts, and Home Sales are all showing persistent monthly declines
that convince me that we are well into Phase II of the Obama
Depression. Since Barack blamed Bush for everything to include
Global Warming, which of course does not really exist in the realm
of verifiable SCIENCE, I am going to lay this one at the feet
of the Community Organizer who had ample opportunity to make a
positive contribution to recovery BUT DID JUST THE OPPOSITE.
Another prime example of incompetence in American officialdom, a
state of affairs that all of us and our generations to come will pay
dearly for. I actually pity whoever is elected President this
year because they will undoubtedly go down in history along the
lines of Hoover and Coolidge, presiding in a depression era that
will take decades to exit and of unprecedented severity well beyond
the capabilities of one President to ameliorate.
GDP is such a politically manipulated
statistic, that we will be well within the grasp of the economic
sinkhole this cycle before Washington releases any two
consecutive quarters of negative growth with the Recession Label
on them. But we who actually work for a living already
I threw this one in to see if you were paying
China is in deep doo-doo, so that "MIRACLE" will do
the opposite of putting the world back on track!!
There is no shortage of these Southbound economic graphs, and
since they can be confirmed from multiple sources, independent
of political manipulation, one has to heed their warnings that
the economic decline is accelerating to the downside, not
plateau'ing as media pundits financed from Wall Street would
have you believe. Statistics will only get worse as we
head toward the Election in November, regardless of the efforts
of officialdom to put a positive spin and outright falsification
on the numbers.
The jig is up for this cycle. ZIRP and NIRP have proven to
be utter failures in the Central Banking Bag of Tricks along
with QE's of progressive numbering; more of the same tactics
will be PUSHING ON A STRING. All the King's horses and all
the King's men could not put Humpty Dumpty back together again!!
THIS IS WHAT PEAK DEBT AND A
PROLONGED DEBT COLLAPSE LOOKS LIKE, SPORTS FANS!!!!!!!!!!!!!!!!!
Economic and Financial System Deteriorations across the globe
will be more and more numerous as we enter the Late Spring/
Early Summer period, so don't get too fancy in your timing of
additional Gold and Silver purchases. The Precious Metals
are in a new bull market, and he or she who over-thinks the
acquisition timing of same is going to be left at the train
station. Eventually, it will be very difficult to buy any
bullion at any price, and that time may come sooner than any of
us thinks possible.
Sage of Wexford,
NEWS FROM THE FRONT - May 21, 2016
My, my, my. One mention of
a June rate increase from two Fed Heads, and the Goldman-Morgan
cabal uses it as an excuse to provide a very quick correction to the
2016 advances of Gold and Silver. Granted, the
supposedly-always-right Commercials had a record short position on
the metals with the Speculative Trades record long, but the know-all
Commercials work down these shorts during a pullback. And in
reality, the Commercials are not always right!. All
hocus-pocus if you ask me.
There is still too much influence in daily bullion price discovery
via the bogus Paper Market of futures and options, but that is
changing as more and more bullion comes off the market via physical
deliveries, not just Exchange Deliveries, but deliveries to your and
my front porches (signature required!). Most of this possessed
bullion ( no exorcism required here! ) will not come back into the
physical market for many, many years
BECAUSE THERE ARE VIRTUALLY NO ALTERNATIVES THAT ARE EQUALLY LIQUID
AND SAFE AS GOLD AND SILVER ACROSS THE INVESTING LANDSCAPE.
Personally, I do think that Chair Yellen will increase rates by a
whopping 25 basis points in June, BUT WHEN THE HECK ARE MY BANKS
GOING TO PAY ME SOMETHING WORTH TALKING ABOUT ON MY CASH DEPOSITS!!!!!
The result is for me to buy more gold and silver and colored
diamonds with this FALLOW ASSET, and leave just enough for future
expenses and maybe emergencies, BUT REDUCE THE FREE MONEY I AM
GIVING MY BANKSTERS WITHOUT COMPENSATION. Where else in
the universe do you give a valuable asset to another party, one you
have scrimped and saved for, and receive no compensation for its
Only on Planet Earth with the New Millennium CENTRAL BANKING THAT
HAS NOT DONE ANY GOOD FOR US COMMON FOLK and only enriched the banks
and speculators to the detriment of the populace and THE STABILITY
OF THE SYSTEM ITSELF. System failure is going to be a result
of all this accumulation of debt, mark my words ( and those of more
and more observers as the days go by! ). Severe strains,
especially in China, Brazil, Portugal, Spain, Italy, and northern
Midwest U.S. are already beginning to appear. China had a
commodity price surge in its markets a couple of months ago induced
by another flood of liquidity and speculation looking for yield, AND
THIS SPECULATIVE BINGE ON RAW MATERIALS IN A GROSS SURPLUS WORLD HAS
ALREADY UNWOUND!!! So the Red Ponzi, as David Stockman likes
to label the Chinese Monetary Experiment, is now witnessing the
final phase in a speculative spending binge that has been faster and
greater than any country in the world in recorded time.
Gold is still up a handsome 18% year-to-date in 2016 and Silver an
even nicer 20%, while most of the stock averages are either negative
or barely positive. Nah, nah, nah, nah, nah!
Be a buyer on any of these dips, like $25 in
Gold and $1 in Silver, because the Chinese are likely as any
over-indebted developed nation to cough up a GIANT DEFAULT some
Sunday night or just devalue the Yuan 20% to 35% to make debt
payments a little easier for its sinking borrowers.
The United States of Indebtedness will do the same, probably at a
later date, but it is inevitable that we will default on our
obligations in some fashion; we will just call it devaluation of the
Dollar to be backed by Gold or Treasury Bond/Note Maturity
Extensions for the Common Good.
As Jim Sinclair wrote this week, buy Gold and Silver when you have
the cash. You have to be in the game to ever make it to Home
Plate. The Sage has been saying this for years, but Jim is not
a bullion broker like the Sage so there cannot be a conflict of
interest in this recommendation by Jim. The vast majority of
my clients are sitting on sizeable gains in both Gold and Silver
since WCM bullion sales began in 1998. Patience is always
rewarded in investing ....... unless you buy real estate, farmland,
stocks, or bonds today.
Market timing is a fool's game in this
environment because a squadron of BLACK SWANS are already over head,
AND CAN LAND AT ANY MOMENT WITH A ROCKET RIDE FOR BULLION MOST WILL
BE SHOCKED AT. Plus, by mid-summer I think we are going to see
most bullion products in short-supply with 5 to 6 week backlogs for
shipping, at best. There may be a point when the Sage is
forced to retire because he has nothing to sell. Not too
far-fetched in this out-of-control world.
Ms. Yellen finally had the light bulb go off that any nation of
aging demographics where soon-to retire or retired American seniors
require INTEREST INCOME to increase discretionary spending will not
fare well in a Zero Interest Rate Environment. A study done by
the Federal Reserve itself and released this past week TO ZERO MEDIA
COVERAGE showed that there has been no growth in Industrial
Production since 2008! This fact from the horse's mouth
implies, along with other confirming economic stats, THAT THERE
REALLY HAS BEEN NO ECONOMIC RECOVERY SINCE OBAMA TOOK OFFICE.
Not laying this mess at the feet of the Community Organizer, solely,
but this grossly under-qualified politician did nothing to help, but
did much to harm the thwarted American recovery with a political
payback Stimulus Package, ObamaCare, racial divisiveness, breach of
law via immigration give-away edicts from the White House, and being
at the helm with no Fiscal Discipline to run up more National Debt
than all of the Presidents before him combined. Lovely.
Time to do other things today. I will put some telling charts
up as I get time this coming week. But behave like you are in
the middle of a financial and economic depression, BECAUSE WE ARE IN
ONE NOW THAT WILL SET NEW RECORDS ON THE MISERY INDEX.
Sage of Wexford,
buying the dips!
News from the Front: June 24, 2016
He, he, he, he, he. When
bookies, entrenched politicians, uber-bureaucrats in Brussels,
Central Banksters like Yellin', and George Soros are running around
the streets of London yelling FIRE with their pants actually on
fire, I start rolling in laughter in the aisles. Soros was
probably long the British Pound Sterling, so this is one
conservative that hopes this communist-loving Socialist got his
trading head handed to him on this event. I wrote in a blog,
probably on David Stockman's ContraCorner site, that polling is
notoriously flawed and the opposition press in the U.K., which was
firmly against Britain Exiting the European Union, was introducing
bias into the poll results. Gee, that never happens here in
the Untied States!!! The liberal/socialist media around the
world works overtime during election cycles to attempt to discourage
the opposition into either not voting or voting for their cause.
Has been happening for decades now, just watch CNN or MSNBC, and
then watch Fox News for the same event coverage. SHOCKING.
And for those of you in commentary land that have said the
strengthening of the Dollar on this news would be terrible for Gold
and Silver, think again. The flawed Dollar Index is up 2
points this morning while Gold is up over 4.5% and Silver is up over
3.0%. The Commercials via the COT reports are also running
around the streets of London with their pants on fire as they just
added to their short positions in Gold in a record amount. The
premise that they are always the smart money is intrinsically
flawed. If they were correct 100% of the time, then volatility
in gold and silver trading would be very low and everyone would take
the side of the Commercials, with virtually no one left to take the
other side. The nervy Speculators would, but not to the extent
they currently do. Futures contracts would shrink in absolute
volume, and liquidity in the bullion markets at the paper contract
level would be severely strained, possibly for the better in this
There are plenty of periods in modern history when both Gold and
Silver have done very well to the upside with a strengthening
Dollar. It is all about
why the Dollar is
strengthening and, in this case, the realm of Euroland is coming
unglued at the seams and the flight-to-safety people have not gotten
the memo yet that the United States is just another bankrupt
sovereign entity in Debt that it will never be able to repay or even
service in the years ahead. Now the Commercials, the Central
Banks, and the insolvent Treasuries around the world are going to
try to tamp Gold and Silver down all day today, and they started
well before you and I were even awake on the East Coast. The
Commercials are going to add Shorts in order to depress the Gold
price in particular so they have more of their shirts left when they
close out some of their massive SHORT position, but physical demand
around the world for the Precious Metals has been off the charts
leading up to this British Referendum and is not abating today.
The days of the futures markets in New York and London setting the
intra-day prices of both Gold and Silver are slowly, but surely,
coming to an end. The superb concept of the Shanghai Gold
Exchange allowing trading AND settlement in physical metals without
paper contract manipulations, well beyond that which is available in
warehouse FOR DELIVERY, is coming into its own. As the
Western Bullion Exchanges allow delivery defaults to happen in the
weeks and months ahead, the world's bullion trading business will
flow more and more to the East where a position can only be settled
in physical Gold & Silver and not the rotting cash that the Comex is
going to throw at delivery-demanding traders who entered the
position to acquire physical metal. Who the heck wants
fricking decaying Dollars with Obama's mug on them. I think
Obama is on the Fifty-Cent Dollar which is coming out next week,
since that is going to be its Purchasing Power in the next few
My hat is off to the majority of the British people. Never
forget that this lonely island of Anglo-Saxons fought off the Nazi
Huns single-handedly prior to the United States entering World War
II; the French had long since uttered the command first taught to
French generals: "I SURRENDER". The concept of self-rule
runs back hundreds and hundreds of years with the British people,
and the economy killing regulations and constraints put upon them by
the overpaid & arrogant bureaucrats in Brussels over the last decade
finally broke the camel's back. NOT TO MENTION THE HORDES
OF UN-VETTED IMMIGRANTS THAT THE BRITISH PEOPLE COULD NOT AFFORD TO
TAKE UPON THEIR SHORES. GOOD
SHOW. I hope Obama and Hillary have made a note of
this vote against open borders that no civilized country can sustain
along with economic growth and national security.
NEWSFLASH: THE UNITED STATES IS ALREADY IN RECESSION
WHICH IS ACTUALLY THE SECOND PHASE OF THE 2008 GREATER DEPRESSION.
I will get some graphs up here in the days ahead (maybe, after I
leave the British pub crawl!), but more and more information has
come out over the last 10 days that make the existence of a U.S.
recession at this moment about a 90% probability. No one wants
to be the Party Pooper to the Federal Reserve induced and ZIRP-fed
stock, bond, and real estate price rallies that are so long in the
tooth they are beginning to fall out. Real estate prices have
declined in many areas already, and the supply of new homes is being
held back by builders who are trying to maximize price per unit, and
not the traditional volume sales approach. But qualified
buyers are getting fewer by the day, and groundhogs once again are
being offered silly-low down payment loans guaranteed by the Federal
Government in some fashion or the other. Old habits die hard.
But make your financial decisions today
based upon negative economic "growth" in the days, weeks, and months
ahead. The NON-RECOVERY is already toast.
Americans' disposable incomes have just not kept up with home prices
over the last 30 years. This widening gap of home
affordability is going to cause home prices to eventually crater
across America just as the unfolding depression will first put stock
prices in the tank, and then bond prices at all "safety" levels will
tank when defaults explode across the world. Bonds are having
a great day today out of pure panic, but the disintegration of
Euroland is going to cause many Europeans banks to become insolvent
along with the sea of insolvent sovereign states that comprise this
much misguided Union. This could be the Black Swan event that
starts the avalanche of Debt Defaults heading down the Global Mount
Everest of Unserviceable Global Debt. Financial stocks are
being taken to the woodshed as I speak, and they have been in a bear
market for several quarters now. THE DIE IS CAST.
It is all about Affordability + CONFIDENCE!
Auto sales are now dipping month to month, so if you want to go into
debt to buy one of these overpriced conveyances, you may want to
wait until Fall or Winter to pick up the deals that are going to
bloom like Brexit voters.
Lastly, the Employment situation is
worsening, not improving, as more and more Americans either leave
the workforce or have to take one or more part-time jobs at a
fraction of their prior salaries to keep food on the table.
Obama can truly take a bow for having done such a great job with the
U.S. economy. I label this depression the Obama Depression,
and it could not be tagged upon a more incompetent, lawless Chief
Executive. There will be few statues of this piker dotting the
landscape of America in the decades ahead.
Waiting for AMexit,
THE SAGE OF WEXFORD
News from the Front: August 5, 2016
Be confident in your precious
metals positions because the proverbial Rubber Band is stretched so
tight & thin in the world's financial system that you can almost
hear the fibers straining just before failure. Yeah, yeah,
yeah, I sound like a broken record, but it will be I that plays, "My
Heart Bleeds For You", when the inevitable economic and financial
collapse just around the very near corner gets underway with a
vengeance. And by "you" I mean all out there in 2016
Fantasyland that do not grasp the severity of the situation we are
truly in as the last days of summer come to a close. Many
"falls" occur in the Fall, but a massive bank failure daisy chain
can ignite at any moment especially when such major banks as
Deutsche Bank in Europe are technically insolvent.
I guess it is human nature not to want to dwell on the negative side
of the aisle in life, but many a fortune and financial posture have
been ruined throughout history when individuals are so engrossed in
their own pursuits of happiness and livelihood that they fail to
observe the warning signs all around them. Tunnel vision can
be very dangerous, for a train engineer as well as an investor, as
in chasing any of today's financial or real estate assets into the
price stratosphere where no value can be found and retrenchments in
price are a given at any moment. There are more warning signs
than usual in today's environment, but I have shown them to all that
would look in the many months prior to this epistle, so I will not
bore you with the same canary tweets here.
Since the Sage of Wexford, that venerable icon of prognostication,
has pounded his fist on the table of truth for years now about the
existence of a 2008 Recession / Depression that just won't go away,
I present the following graphic graphic:
The hideous Red Line represents 1.2% GDP growth,
a threshold that has only twice been reached since 1948 AND THE U.S.
ECONOMY WAS NOT ALREADY IN RECESSION. Of course with the $60
to $70 Trillion of new debt added to the global system at all levels
since 2008, the period we are firmly within can only be deemed a
DEPRESSION in the final analysis because the global system is so
impaired structurally that all of the fiscal and monetary
machinations to stimulate a moribund, sick world economy have been
for naught FOR THE LAST 8 YEARS.
Depressions are very difficult to exit, just ask survivors from the
Great Depression in the 20th Century, and this one is no different,
but in the end will prove to be much more severe and much longer in
Now of course this FRED graph is utilizing compromised Government
statistics, but the trend and overall picture are quite clear:
Either we are headed down into the economic basement OR WE ARE
ALREADY THERE. I pick the latter condition, but use your
own interpretations to get some bearing on how you should spend your
discretionary income and savings these days.
What does this analysis have to do with purchasing and holding both
Gold and Silver, you ask?
The risk of bank, corporate,
Government, and personal failures just went off the scales.
No system can carry the burden of debt that the world has today and
not experience failures and collapses WHEN THE GLOBAL ECONOMY TURNS
MARKEDLY SOUTH AGAIN. Period, bing, bang, boom. The
Central Bankers can stand on their academic heads and bay at the
moon until the cows come home on this one, but even the stupidity of
the Bank of Japan in burying the Land of the Setting Sun in
Trillions of Yen of unpayable debt has NOT helped Japan one iota.
A case in point.
AND NEITHER WILL MORE OF THE SAME MONETARY STUPIDITY ACROSS THE
GLOBAL LANDSCAPE DO ONE TRICKING OUNCE OF GOOD TO SAVE THE FAILING
FINANCIAL AND ECONOMIC SYSTEMS AROUND THE PLANET. The patient
is dead, cremate it already, and push the infamous Hillary RESET
button to try to figure out what debt is actually going to be repaid
in the decades ahead. The thought of Debt Deadbeats getting
free rides on future debt repayment turns my stomach.
But global economic retracement has occurred not just at this
moment, but for the last 6 quarters of calendar history (and sooner
for many provinces in China and countries in Europe). That has
been the duration of negative earnings comparisons, year-to-year,
for the S&P 500 companies, and the quarter just ended in the United
States, Second Quarter, 2016, just registered Negative Growth or
Actual Decline in Year to Year Corporate Earnings for the SIXTH
STRAIGHT QUARTER. Need one be hit over the head with a
Louisville Slugger to get the message here??!!!
Sooooooo many stock and bond investors are operating on A Hope & A
Prayer that the Fed can come to the rescue when the trap door opens
on Wall & Broad and the lemmings can't jump off the cliff fast
enough. The Federal Reserve of the United States has shot its
wad, and regardless of the grandiose schemes they may pull out of
their rear ends in the months ahead, THEIR PRIOR FAILURES ARE TRULY
JUST PRECURSORS TO THEIR FAILURES JUST AHEAD. Even a cartoon
super-hero could not pull this one out of the fire.
Gold is down some $22 today and Silver down about 60 cents due to a
stronger Dollar based on another smoke-and-mirrors EMPLOYMENT
REPORT, but once the entrails of the chicken are analyzed by those
without a political agenda, it will once again be shown that the
Labor Market is actually weak or weakening and not even a modicum as
strong as the Government puppets in Washington would have you
believe. More to follow on this angle as I get time this week.
How could the labor market be improving or considered strong when
corporate earnings are in decline and for a prolonged period of
time? Does not happen and I have been through no less than 7
economic cycles in my illustrious life so I should know something
about this topic.
Another Phony Jobs Report, August 5, 2016
Paul Craig Roberts
As John Williams has made clear, the monthly payroll
jobs number consists mainly of an add-on factor of
200,000 jobs. These jobs are a product of the assumption
in the Birth-Death Model that new business ventures
create more unreported new jobs than the unreported job
losses from business failures. If we subtract out this
made-up number, July saw a gain of 55,000 jobs, not
enough to keep up with population growth. Even the
55,000 figure is overstated according to John Williams’
report: “The gimmicked, headline payroll gain of 255,000
more realistically should have come in below zero, net
of built-in upside biases.”
In other words, the 255,000 jobs are the product of a
virtual reality created by a faulty model and
manipulations of seasonal adjustments. Williams says the
real rate of unemployment is not the claimed 4.9% figure
Even if we assume that 255,000 jobs were created in
July, the news remains bad, because the jobs claimed are
mainly lowly paid part time jobs without benefits and
provide insufficient income to support an independent
existence. This is why so many employed young people
continue to live at home with their parents.
The labor force participation rate, a measure of labor
market strength, is far below where it was 22 years ago.
The low participation rate is inconsistent with the
claimed 4.9% rate of unemployment.
But the Employment report is merely an excuse for bullion traders to
take profits after a magnificent run in 2016, and no reversal in
trend is even remotely in sight, so put down that bottle of aspirin,
you will be fine. In fact, the Sage actually bought some Gold
this morning for his Silas Marner hoard in East Siberia, but a
market timer I am not. A LONG-TERM INVESTOR I AM, and it has
served me well since 1997 to buy and never sell an ounce, even to
buy a new car or pay off a politician. Now both gold and
silver may go lower in here, only the Shadow knows for sure, but who
the heck cares.
GET AS MUCH MONEY AS YOU CAN OUT OF THE
BANKING SYSTEM. SHE IS READY TO BLOW.
Sage of Wexford,
the Party-Pooper Extraordinaire.
News from the Front: October 8, 2016
As Matthew pounds South Carolina, failed Central Bank monetary
policies pound into fragments the financial and economic system of
the world. No exaggeration. The largest German bank, and
probably the largest bank in Europe, is decidedly insolvent,
awaiting some form of bail-out by the German people or "bail-in"
where stockholders and bondholders and large, underinsured depositors
subsidize the poor decisions of Deutsche Bank management for decades
now. The German people are hardly in any mood to bail banks
out a second time this Millennium, so bail-in's are likely to be the
first salvo at salvation for the numerous EuroLand banks that are
teetering on the precipice of insolvency. Nothing has been
cured or solved with all of the money printing by Central Banksters
since 2008, THEY HAVE ONLY MADE THE OUTSTANDING DEBT THAT WILL NEVER
BE REPAID OF SUCH ENORMOUS QUANTITY IN THE TENS OF TRILLIONS OF DOLLARS
OF SUCH HISTORIC MAGNITUDE THAT THE DEFAULT PANIC IN PROGRESS IS ALL
The avalanche of defaults and insolvencies globally has already
started a snowball the size of Manhattan down the MOUNTAIN OF
NON-PAYABLE DEBT. The Second Phase of the Greater Depression
is in inning number two by baseball standards and poised to
accelerate to the bottom of Human History, the dregs of history by
Since Gold hit a yearly high this year of $1365 for a 28% gain and
Silver hit a high around $20.60 for a 49% gain, it is no surprise
that the precious metals are currently correcting to wash out some
of the speculative hands who helped push investor sentiment to bullish
extremes. With about $300 in gains in Gold from 12/31/15, it
is no shock either that we have currently pulled back some $100 or
33% of the up-move. With about $6.80 in gains in Silver from
12/31/15 at the year-to-date high, we have currently pulled back
about $3 or corrected 44% of the up-move, another NON-surprise.
Very typical of commodity markets, and certainly to be expected
based upon how popular all of a sudden the Precious Metals were
becoming with the Hot Money Crowd, the hedge funds, speculators, and
money managers. Too many passengers on one side of the boat
tip the boat. A correction is healthy to bring in new and
stronger holders of the metals who take the longer term view of
holdings, and are not disposed to trade the pants off the sector.
Since the all-knowing (?) Commercials have been heavily Short both
Gold and Silver most
of the year, much to their chagrin, they have also been exiting
their short positions during the last several weeks in both Gold and
Silver, while the wild-and-wooly Speculators have been reducing
their record-setting Long positions! So the Long & Short
trading positions are coming
more into line with normal as this correction proceeds.
Although the Sage can forecast economic growth 1000% better than the
failed Federal Reserve, I am not going to try to call a bottom area
in both Gold and Silver where we will definitely turn sharply around
and head North again with a vengeance. However, to make sure
you get your money's worth from this epistle, we are probably within
$50 of price for Gold and within 50 cents for Silver, but do not bet
your last dollar on this total guess. I am also guessing
that Donald Trump wins the Presidential Election, so there!!
Hillary has more baggage than an American Airlines
ALL I CAN SAY IS:
BUY THE DIPS IN
BOTH GOLD AND SILVER BECAUSE THE WORLD IS BECOMING A MORE DANGEROUS
PLACE FOR YOU AND YOUR MONEY AS THE DAYS PASS.
Things are not getting
better or improving because we have utter incompetents at the levers
of power and especially at the Central Banks of the world, the
Federal Reserve leading the band of knuckle-heads to the heap-pile
of failed policies.
These are very encouraging graphs
of Gold and Silver over the last 2 years and show a very normal
pull-back to support in the 200-day moving average region.
Nothing to jump out of a window about. In fact, you should be
getting as much money out of the financial system due to all of the
ties that American Banks have to Sinking Deutsche Bank as you can to
store as hard cash and use to purchase Tangible Assets that will not
be swept down the mountainside in the unfolding Avalanche of Debt
Defaults headed our way. Buy when there is blood in the
streets, a phrase that is fitting for the Halloween Month of
October! Gory, but fruitful.
We are already firmly in Recession in 2016 as shown by the Baltic
Dry Index, Freight Rates of all genre, Auto Sales, Retail Sales,
Home Sales, both new & existing, and by the LIE-o-meter coming out
of Washington which is hitting all-time highs. Do not wait for
an official announcement of U.S. recession because its effects will
have hit you square in the face and into your pocketbook long before
the shills in Number Crushing Ville decide they can't fudge the
numbers any longer. If Trump gets elected, they will cough it
up fast to prove that his election crashed the system. REALLY.
I would say Barack will have had more to do with the re-entry into
recession/depression with a failed Stimulus Package of some $800
Billion, ObamaCare coming apart before our eyes after devastating
the wallets of many Americans, and racial division crushing the
economies of cities such as Baltimore & Chicago that the First Black
President has only made worse, not better. King Obama's Open
Border policies via Executive Edict have cost us legal citizens Tens
of Billions of Dollars over his 8-year term, an easy argument to
prove. Respect is not granted merely due to holding high
office in the land, it is earned each and every day in office.
David Stockman has a new subscription service with daily updates
as to how screwed up we are at this point. $29/month and
every penny. More info than Sage could ever provide you with.
Skip a Starbucks or two every month and stay enlightened.
Interest rates at the 20 and 30 year maturities are heading up
around the globe as bond buyers insist on higher yields in order to
buy all of the quasi-junk that is being put before them at the
Government, Corporate, and consumer levels. It was only a
matter of time before investors realized that most of this freshly
printed debt was in grave risk of never being served on time as
Governments extend maturities BY EDICT to plug the dike of
insolvency, and outright defaults occur on Greek, Irish, Spanish,
Portuguese, French, and Chinese bonds. If you own bonds
currently, I would think about cashing out to try to save your
retirement plans. Bill Gross, also known as the Bond King,
thinks the global bond market is an accident waiting to happen.
Prices of bonds have never, never, never been this extended for such
an extended period of time, AND NEGATIVE INTEREST RATES HAVE NEVER
EXISTED IN THE HISTORY OF MANKIND. DUH, DUH, AND DUH.
Okay, time to watch some college football, but you get the message.
BUY THE DIPS.
Wexford, longing for the days when my keyboard is replaced by a
News from the Front: November 12, 2016
Would rather be watching college football than pounding out my 163rd
bullion ezine, but my team does not play until 8 pm tonight, so I
would be football saturated by then. I know your first
question is: "why didn't the Precious Metals rally big time
after that loose-cannon Donald Trump was elected President this
week?". At least he is not an un-convicted felon and influence
peddler and national security risk. During the night of the
election gold spiked to $1340, but came back down to a bargain
basement $1230 by the end of trading on Friday, Veterans' Day,
November 11th. ( Hope you put out a flag for the men and
women who sacrificed all to keep you free! )
After pondering the Super Moon in the night sky, I realized
that the bond market got clobbered last week, with bond yields
spiking higher than Hillary's blood pressure on Election Night.
Hedge Funds, who charge big fees and over the last several years
have returned small returns, have continued to ride this Bond Nag
until the poor steed's hooves have fallen off and the beast has
literally died of exhaustion over the last several quarters.
This is not just in the Untied States, but around the world where
bond yields are mysteriously heading higher even as Central
Banksters pull out all the stops to keep money nearly free for one
SO THE BOND VIGILANTES THAT HISTORICALLY HAVE KEPT BOND
PRICES AND BOND YIELDS WITHIN THE REALM OF FINANCIAL REALITY FOR
DECADES PRIOR TO THE GREENSPAN/BERNANKE/YELLEN MONEY PRINTING ARE
BACK IN TOWN WITH A VENGEANCE. You see, Grasshopper, there are
two very fundamental elements to bond pricing that have been absent
from the crazy bond market of the world in the last 8 years:
INFLATION RISK AND CREDIT OR DEFAULT RISK. Now that many
fiscal, financial system, and economic system bodies are floating to
the surface of the pond in 2016, bond investors realize that bonds
are way, way, way overpriced AND WITHOUT ADEQUATE YIELDS TO
COMPENSATE FOR THE MANY DANGERS PRESENT & JUST AHEAD.
Janet Yellen needs Pampers with spike!!
So the Hedge Funds, also part of the
SPECULATOR category in the Bullion Trading pits, were getting so
beaten up in their Bond long positions last week that they needed to
liquidate their over-sized (and speculatively over-extended!) Gold &
Silver LONG positions to meet margins calls and get liquid from the
blood-bath in the Bond Market. Not that they felt that all of
our nation's and global devastating woes would be solved by the
Donald riding his White Horse into Washington, AND THAT THE GOLD
HEDGE WAS NO LONGER NEEDED, but because they were wrong big-time
on the direction of bond yields and inversely bond prices AND WERE
GETTING THEIR CLOCKS CLEANED. Not buying the argument that the
Dollar reaching 100 on the Dollar Index is the main cause; metals
have done just fine during strong Dollar periods.
Now the COMMERCIALS, reportedly the Smart Money in the Gold & Silver
trading pits because they are insiders who actually use the stuff in
commerce, I am sure helped whack the metals' prices daily last week
to get prices lower so that they could reduce their whopping Short
positions in both metals. JUST THINK OF IT AS THINGS GETTING
MORE IN TUNE WITH THE UNIVERSE IN THE GOLD AND SILVER PITS. So
the C.O.T. reports to come out in the weeks ahead should show that
we are nearing the end of this roller-coaster ride of a Precious
Metals Correction (PMC) as Speculative LONGS get back to a more
"normal" level AND Commercial SHORTS do the same. All will
soon be right with the world.
Since The Donald, aka President Elect Trump, has never seen a debt
that he did not like, and inflation is rearing its ugly little head
in prices across the board & around the world of late, and the
humongous INFRASTRUCTURE & MILITARY SPENDING that Prez-Elect Trump
is proposing to jump-start the dead-on-arrival OBAMA Economy is
devoid of any hints of places to cut the Giant Federal Budget, THE
BOND MARKET GOT KIND OF SHOOK UP FROM THIS GOODIE BAG OF ESCALATING
FEDERAL DEFICITS. Stocks won't stay happy with a 15% Corporate
Tax Rate, whacked Federal Regulations that strangle American
businesses, or jettisoning ObamaCare out the window of Trump One
WHEN BONDS YIELDS ARE SPIKING TO THE MOON AS COMPETITION TO STOCKS.
Higher and higher costs for financing a business are never good for
stock prices or Corporate Earnings, just believe me on this one!
Oops, stocks don't look so hot now!!!
As David Stockman, my hero, points out: The elephant in the
room, and with a Pure Republican Congress this is more than a play
on words, IS THE DEBT CEILING INCREASE THAT MUST BE PASSED BY
CONGRESS BEFORE MARCH, 2017, SHOWING THE WORLD THAT THE UNTIED
STATES ARE DROWNING NOW IN OVER $20 TRILLION DOLLARS IN DEBT.
There will be a lot of tranquilizers passed around in the New
Congress in 2017, because not all Republicans are Fiscal Moderates
or Lopsided Spenders like Trump. PROGRAM CUTS, AS DEAR AS
MEDICARE AND SOCIAL SECURITY INCLUDED, ARE GOING TO HAVE TO BE
DISCUSSED AND DEBATED UNTIL THE COWS COME HOME. Heck, some
spending cuts might even be passed in a moment of Legislative
Enlightenment (LE)!!! The Sage says to trash the Dept. of
Education since our kids aren't even learning how to tie their shoes
in school these days, and to cut the E.P.A. by a modest 80% without
one endangered species getting extinguished in the next nanosecond.
THE REAL ENDANGERED SPECIES IN THIS COUNTRY IS THE SMALL BUSINESSMAN
AND BUSINESSWOMAN. And those of us who have been financially
responsible with our money and spending for the last 50 years
....... like the Very Modest Sage (VMS)!!!
So even though there is still rioting in the streets by a bunch of
SORE LOSERS who probably don't have jobs to go to in the morning (
thank you Outgoing Prez Obama! ) and would rather picket, protest,
and destroy anyway as a personal preference, NOT A HECK OF A LOT HAS
CHANGED FOR THE FUNDAMENTALS OF OWNING AS MUCH GOLD AND SILVER AS
YOU CAN POSSIBLY HIDE AWAY. The world is still the very
dangerous place it was on November 7th, dangerous to your financial
survival and even physical survival.
Let's look at what the Gold and Silver charts show after last week's
Both metals are still in new Bull Markets, no reversal in major
trend as I type, and who says both Gold and Silver do not violate
their 200-Day Moving Averages within bull markets from time to time
without killing the Bull!? They can in fact oscillate over and
under this magic technical line all the time within bull markets.
It is noteworthy also that these are not normal times in the bullion
trading pits. J.P. Morgan-Chase take a bow ...... for one!
Do not get too wrapped around the axle of technical chart reading.
Gold has major support in the $1220 zone, and Silver has major
support in the $17.30 zone. Not trying to put lipstick on a
pig here, I just like being long markets where Russia and China are
buying with both hands in their quest to unseat the Almighty Dollar.
And that day is nigh, but a subject for another day.
YOU ARE BEING GIVEN ANOTHER OPPORTUNITY
TO LOAD UP ON GOLD AND SILVER BULLION BEFORE THE WHEELS FALL OFF THE
GLOBAL CART! Don't let it pass you by!!!!!!!!!!!
Sage of Wexford,
buying while others hide under a mattress.
P.S. I did vote for The Donald, I confess. The thought
of Billy Bob Clinton being set loose in the White House again
amongst any female workers frankly turned my stomach. And, the
Clintons steal furniture, paintings and things each time they leave
a Government position. We couldn't afford them!!!!!!!!!!!!!!!!
News from the Front: December 13, 2016
The last dewdrops of wisdom from
the Sage for 2016. Very interesting year, but we will not
reminisce here, but highlight the goings on in the various markets &
economies that will have an impact on Precious Metals prices going
forward. Everyone should be buying both Gold at $1,162 &
Silver at $17.15. No guts, no glory. No matter what
Fibonacci retracement percentage or dollar amounts we have corrected
from the 2016 highs, we are still firmly within new bull markets for
Oh, Gold is still up 9.4%
since 12/31/15, and Silver up a whopping 24.1% even at today's
corrected prices ........ the Poor Man's Gold (Ag) doing twice as
well as the casino chips called stocks ...... with a fraction of the
risk via the fundamentals and value.
I think Gold is being sold short in
the futures market by Russia & China so
that they can accumulate more physical into their vaults
while Uncle Sam is
asleep at the switch. Dollar is on a short leash as
Silver has not corrected anywhere near
the degree as Gold, which suggests
that inflation is rearing its ugly head once again
around the world as the
Gold to Silver ratio declines. Very, very
The rapidity with which American investors jettisoned the Precious
Metals to load up on more overvalued stocks is quite amazing, but
they did have the wisdom to reject Hillary's bid for the White
House, so I give them credit there. The Donald will not be
able to spend as promised using an Overdrawn U.S. Checkbook of over
$20 Trillion in the red, so the euphoria since Election Night will
be short-lived in stockmarketville. The Gold ETF's & Silver
ETF's, not really a wise way to participate in two asset markets
that have beaten the pants off of stocks and real estate since year
2000, have suffered large redemptions in shares which forces the
custodians to sell Gold and Silver into the marketplace, further
depressing prices. That American investors would be so frail
in their convictions of fundamental prospects for stocks versus
precious metals is quite telling in a society that put a Community Organizer
into office for a span of eight years.
Actually, I personally hope this exit from PM ETF's will be somewhat
permanent going forward, because when an outside auditor is finally
brought in via Government edict or investor lawsuit, it is highly
probable that the results will find a gross shortage of metals
within the vaults of the custodian. It is only a matter of
time before this will occur. When such parties as Morgan are
involved with ETF bullion accounting & storage, it is truly the fox
guarding the hen-house.
The failed German bank, Deutsche Bank, probably receiving German
Government/ Central Bank assistance as I type, has admitted to
conducting illegal trading practices and collusions in the Silver
market and has gone State's Witness against about 8 other offenders
in the largest European and American bank categories. We are
hardly surprised based on the regularly perverse price action of
Silver since 1998, but the cow is finally out of the barn and headed
for the Chicago slaughterhouse. This trial has put the likes
of Goldman and Morgan and Bank of America on notice that their
highly manipulative trading activities will be increasingly
scrutinized and prosecuted going forward. Especially with such
a Free Market Advocate as Sir Donald Trump in the White House
lobbing munitions at perpetrators on a daily basis.
I just knighted the Donald to put him on
equal footing with Sir Alan Greenspan, a Central Banker who did more
harm to the U.S. financial and economic system than any single
academic hack in American history. I expect Mr. Trump will be
remembered in quite an opposite vein, a more colorful one at a
minimum. Bernanke and Yellen will take Second & Third Place on
that dubious Wall of Shame in the years to come. Central
Bankers do not know more than millions of market participants on how
to price money to maximize economic growth or employment, and
minimize inflation. THAT HAS BEEN UNEQUIVOCALLY PROVEN NOW
SINCE THE FALL OF 1998.
The Euro Single Region Currency is failing along with the European
banking system, Governments, and European economies. The
British post-Brexit have kicked themselves in their derrieres for
not buying more Gold since that historic vote to become a free
country again, the only true currency appreciating mightily against
Sterling and the Euro ever since. Italy and its banking system
are on the verge of collapse (IF NOT ALREADY IN COLLAPSE!!!), and
the Domino Effect in Europe is well underway to bringing the
Continent down to its collectivism knees on a hard count.
Nationalism is alive and well around the world. Global
Homogeneity was a failed concept from the outset. Never forget that
the largest American banks hold very large quantities of the paper
of insolvent European governments and sinking European banks.
Speaking of the Bond Market, as I have warned for years now as
global yields for insolvent borrowers have reached truly RIDICULOUS
levels, devoid of any pricing element of Default/Credit Risk OR
Inflation Risk, has ended its Bull Market that existed for an
unprecedented 34 years, and now is being mauled by a newly-born BEAR
MARKET. Mortgage rates Stateside have surged some 30% over the
last several months, putting a further damper on the Housing Market
that suffered already from overpriced abodes to buyers who could
barely meet the monthly home payments even with grossly subsidized
interest rates. The bloom is well off the housing market rose,
another nail amongst a box of nails in the coffin of the American
economy. Mr. Trump will not be able to affect change fast
enough or spend money fast enough to turn this well-established
trend around. Sorry ....... Stock Dreamers.
The 10-year Yield has surged from
1.34% to almost 2.50% in just over 5 months. When
it exceeds 2.50% and stays there, KATY BAR THE DOOR FOR
Stocks are destined to follow bonds down in price.
Emotional rallies are very fickle.
There is also price depression ( yield elevation ) of U.S.
Treasuries globally as sovereign states continue massive
liquidations of this now questionable debt in order to plug
insolvency dikes at the State, Corporate, and Banking System levels.
With a new Spender in Chief soon to enter the White House, fiscal
soundness of the United States looks to soon be more compromised
than ever, and Central Banks might as well jettison this budding
junk in order to plug solvency crises on the Homefront. China
seems to be the lead character in this unfolding theater, but
massive sales of U.S. Debt will become a Rate Increase Factor ( RIF
) in the weeks and months ahead ACROSS THE GLOBE. The bloom is
off the safe haven status of U.S. Debt Obligations, and they are a
ready source of hard currency for Sinking Ships of State ( S.S.S. ).
History, as usual, is unfolding before our eyes. Ho, Ho, Ho,
Sage of Wexford,
Happy Holidays & Merry Christmas to All,
count your Blessings.
PRIOR DEWDROPS OF WISDOM
VIA "News From The Front"
News from the Front -
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