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Monkey You
Posted on Thu, 03 Jul 2014 @ 14:52:11 CDT by Captain_Hook

Commentary_Free

Originally published as a subscriber article 11 Mar 2014

What if I were to tell you not owning gold or silver makes you a monkey – a silly monkey to global elitists and their ilk. Would you believe me? Would you be mad at me? I hope so, as this is exactly what I intended. Because you should be mad, not at me for attempting to awaken you to the need for owning gold and silver; but at the so called ‘powers-that-be’, the plutocrats, bankers, bureaucrats, and politicians (the establishment), the ones that do everything in their power to dissuade you from owning precious metals. (i.e. because they can’t tax what they can’t see.) And no I am not a conspiracy theorist – I am a realist – I simply look at the evidence. But again, those who do not, and laughingly fall back into the comfort of the attitude precious metals investors are a bunch of ‘nutty conspiracy theory types’, are equally funny monkey types to the discerning mind, either an idiot or establishment lap-dog if you will.



Have I gone too far – basically insinuating people are dumb monkeys for not seeing the need to own gold and silver, and for trusting establishment types? In this regard I sincerely hope that you are pushed outside of your naive comfort zone, which by the nature of the task requires some provocative prodding in order to get the blood boiling, but please understand I am not the one insulting you – I am not the one attempting to make a monkey out of you at all – ‘they’ are – they are the ones that think you are dumb monkeys who will do what you are told – what you are conditioned to do like the monkeys in a ‘control experiment’ – not me. I am simply attempting to awaken you to this reality – because it won’t go away by ignoring it or making believe it doesn’t exist – believe it or not. So don’t shoot the messenger – please.

So, what’s all the fuss about gold and silver? And why should you own them. Obviously I am speaking to the novice in the ‘financial survival game’ here, and not the veterans out there, so keep this in mind; however, it doesn’t hurt to hear this again no matter where you are in the spectrum, especially if accented with an update of where we are in the larger cycle (process) of the precious metals bull market. The fuss about gold and silver then, in basic terms, is it’s protection from the vulgarities (think rising prices, wealth confiscation, and lower living standards) associated with currency debasement the Anglo / American establishment depends on to maintain power, where we are now drawing ever-so-close to the end game. Why should you own gold and silver then? Answer: To exit the present bankrupt / over-indebted financial system that is close to implosion caused by it’s own critical mass. (i.e. to protect your wealth.)

What’s more, it’s not a matter of if the Anglo / American (Western) system will end one day, but when, because they all do, especially one so indebted to bubble economics. The only other question is what will prick the bubble? Will it be attributed to excesses directly associated with the Fed or China in the history books; or perhaps Valdir Putin, because although the West would like to make believe he (and Russia, the periphery, etc.) is not a destabilizing force capable of doing so, unfortunately this is not the case. Only time will answer this question of course, not that it should matter to you, meaning taking care of yourself because neither the state nor establishment will. (i.e. you are viewed as assets to be taxed by these types.) And this should matter to you because it’s happening in real time – right now – where one should endeavor to protect hard earned wealth in tangible and enduring money before it’s to late – not fluffy currencies that are manufactured from thin air on a bureaucrat’s (think banker) whim. And again, this is where gold comes in, as it’s ‘the’ ancient monetary metal that has been with us for thousands of years; and, as Antal Fekete would tell us, the ultimate extinguisher of debt, essentially beyond the reach of the establishment. (i.e. although its price can be manipulated at times.)

Because that’s what we are talking about here, financially surviving the implosion of ‘the system’. Of course the powers-that-be are not going to stand idly by and watch their paper empires (and power) implode without attempting to do something about it. And we know what they will do about it, which was discussed in my work last month, the fact that the Fed (all central bankers) is nothing more than a ‘One Trick Phony’ – they will print increasing amounts of phony money, Federal Reserve Notes (FRN’s), better known as dollars($’s), which again, are nothing more than increasingly worthless fiat currency printed in ever-larger amounts daily by the friendly folks down at the bank – again – in ever-increasing amounts. And it will continue to do so until the market says – no more – something that will never occur voluntarily. So for those wondering whether the implosion comes in the form of deflation or hyperinflation, one would do well to betting on the latter before the former.

For my money, which by the way is well anchored in gold and silver because of this risk (and attributes discussed above), I am willing to bet some degree of both extremes (deflation and hyperinflation) grip macro-conditions before it’s all over, with the former being the apparent ‘big worry’ for the Fed right now, but the latter (some degree of hyperinflation) most likely the demon that will ultimately break the system. This of course assumes the $ will remain the world’s reserve currency until events begin to spiral out of control, which is quickly becoming ‘the important question of the day’ given efforts from both Russia and China (the trading blocs they are forging, decentralization, etc.), not to mention the Arabs (that US foreign policy frequently angers these days), making some degree of hyperinflation first a distinct possibility. (i.e. especially if the US loses the petro$.) And again, it should be understood that when ‘the system’ does occur, it will most likely be a result of hyperinflation first, followed by deflation – with prices possibly doubling overnight right out of the blue – and then collapsing afterwards as economies will need to be reorganized into more practical and lasting frameworks. (i.e. think of  the need for economic decentralization brought on by rapidly dwindling hydrocarbon supplies.)

So when I say don’t let these apes make a monkey out of you by not having a percentage of your portfolio in gold and silver bullion, one may have a better idea of why now, but let me continue because I have more. Don’t let the unnecessary volatility they create in precious metals dissuade you from doing the right thing to protect yourself financially. Don’t let them scare and confuse you because the stakes are high – your economic survival. The Russian’s know this, as you will learn below.

And while this may not appear important right now, with precious metals prices seemingly well under control over the past few years, at some point, possibly quite soon, this will change. We know this on both a technical and fundamental basis, meaning at some point man made fiction will meet reality. On a technical basis we have what appears to be a sustainable reversal from up to down in the Dow / Gold Ratio (DGR), discussed here at length, which is the key measure of liquidity flow measurement between the fiction of the stock market and reality of the physical world. Commodities are becoming increasingly scare and more expensive to consume, which is not being properly reflected in both, stocks and gold, with the latter the ultimate barometer in this regard. But how can this be on an extended basis, where things have run into noticeable extremes over the past few years? Answer: Because of faulty and fraudulent market mechanisms (think futures, HFT, algos, etc.) And this understanding is finally gaining some traction in the mainstream.

This is what the Russians are mad about, the fact they are forced to take less for their natural resources, which is a large part (along with securing their naval bases) of the reason shaking things up in Crimea does not bother them, even if they must give up Western alliances. Because they realize the West (think the Anglo – American Alliance) is out to screw them out of their natural resources for the lowest prices possible using their faulty and fraudulent markets, propaganda, and predatory policy. And as this understanding becomes more wide spread in struggling emerging markets you can expect to see more incidents like Crimea, which will ultimately lead to an acceleration of the decentralization process in the global economy just signaled by Russia. You may remember my thoughts on this inevitability back as early as 2008, and more recently.

So why would Putin choose now to make this move into Crimea besides the obvious, to protect their strategic military interests, with the veiled threat to the West that more of the same may be in the cards if he thinks they can get away with it? (i.e. if the US / West continue to react in weak fashion.) Answer: Because the West is in fact in a weak position right now strategically (economically), and the Russian’s know it, threating to unload US Dollars and Treasuries if retaliation becomes punitive. What’s more, with US defense spending budget cuts announced this week, Putin knows the US is vulnerable in this respect, another reason you should expect Russia’s neighbors (including developed economy Western alliance members [even Germany]) to increasingly distance themselves from the American Empire. (i.e. like India just did.) Like Rome at its peak, the US has now entered a slow but long-term reversal in its influence internationally, with the global economy now on a path towards decentralization, mercantilism, and reorganization.

One thing is for sure in this respect, with the financialzation of the US / global economy by the knuckle-heads in charge, with Western stock (and bond) markets at all time highs, little doubt can exist the situation is fragile, which is why you can expect both Russia, and China, who has already picked sides (for obvious reasons), to exploit this weakness increasingly as we move forward. The US cannot afford to anger them without facing economic reprisals that would rock the very foundation, shaky as it is (because of bubble-economics associated with the financialization of the global economy), of the Anglo-American power structure. So, as their economies (along with the rest of an exploited periphery) continue to collapse, expect them to accelerate efforts to bolster their situations by any means possible, using the threat of economic retaliation on the US as the ‘big stick’ held over the collective heads of the West. For the Chinese, this likely means making a more serious claim against Japan (a key Western Alliance member) in ongoing territorial disputes, with fresh comments out of Beijing just yesterday in this regard.    

Call it regionalism, decentralization, whatever you want, what is important to understand then, in attempting to make sense of what will appear to be ‘cold war’ like rhetoric, is again, the American Empire is vulnerable here, with key adversaries (Russia and China) quite aware of this due to their subjugation via faulty and fraudulent Western pricing mechanisms, financialzation of the global economy, and predatory Western policy. Now that the West’s fiat currency based economies are fully mature however, these practices appear set to reverse with fringe economies increasingly reverting back to more regionalized trading blocs and organizational frameworks. The thing is they have little to lose as things stand now, with core countries (think US, Japan, etc.), for example, trading worthless paper (think currencies, bonds, derivatives, etc.) for cheap goods and inputs they can no longer afford to give away based on the hope one day these coupons can be redeemed – which as we know, and they (periphery economies) are quickly realizing, is not possible without bankrupting the host.

And with European countries (many of which key core Western Alliance members) unlikely to agree to sanctions against Russia (including London), at some point all this should become painfully clear, this, and the fact it’s the US that is being isolated, not Russia. This is why I am so confident in the assertions above, because there is no other way this can play out, with the only question being cadence. In terms of what the financial markets are telling us right now, in addition to what has already been discussed above, we have two key relationships that should be discussed, both pointing to a turning point this coming Friday. The first is the CBOE Volatility Index (VIX) (attached here), which is running on a 9-day impulse cycle, putting the next likely low at week’s end. It’s important to recognize this will be the second low in a larger degree sequence, which means a new bullish impulse cycle should start the following week, likely as a result of some ‘real trouble’ breaking out.

This thinking is confirmed by the patterning in the second key indicator we will discuss today, that being the DGR, chart attached here  as well. Here, the timing cannot be discussed with the same degree of authority as above, however, at the same time, continued corrective price action this week, involving relative strength for stocks, and the opposite for gold obviously, would be sufficient to complete the pattern. Putting one and one together then, we have two key indicators pointing to important reversals this coming Friday then, so those looking to buy precious metals for example, should do so later this week. As for shorting stocks at what may prove to be an important top, the timing / sequencing of which is eerily similar to that of the year 2000 (stocks topped in March then too), it’s impossible to know whether this is a good idea with the degree of interventions in the market these days, with the stock market now central to the larger financialzed economy, however if things escalate out of control for the US, as vulnerable as they are due to the masterful planning of the geniuses in the White House, it could get interesting.

For my money, owning gold and silver bullion appear to be the best way to go, yielding far superior returns compared to attempting to short a heavily manipulated stock market. Therein, thus far in the descent of the DGR, it should be noted both gold and stocks have been rising simultaneously, which could continue until May if normal seasonality comes into play. Of course if we have a return to the 1929 analog (stocks would be down 50% by April), with recent strength in stocks being a divergence, then obviously being short would likely be the only way of witnessing portfolio appreciation in coming days. Therein, if stocks do not crash in nominal terms, the crash will occur in real terms, first against gold (and silver), and then general price levels. Of course this is what has essentially been happening for some time already, only now, because economic internals are so weak, the moves will be more violent.

Aside from this concern however, you can own precious metals shares after one has taken care of anchoring a good chunk of your wealth in bullion first; but, you should realize the difference between gold and silver stocks and bullion, not to mention paper bullion proxies, better known as exchange traded funds, or ETF’s. Precious metals ETF’s are not bullion ownership (discussed here) because they are administered by bankers, who in the end, will likely steal the bullion backing the trust, a process that appears to be underway as we speak. (i.e. notice lower tonnage for GLD despite higher prices.) This means you essentially have default risk, which is exactly what one is attempting to avoid in owning bullion, so stay away from these things unless your aim is shorter-term trading, and you can live with the risks.

And although the shares do not have the same risks as bullion ETF’s, they have a different set of concerns, especially the share based ETF’s, because of the leverage. Therein, and a topic never discussed even amongst so called ‘enlightened’ precious metals guru’s, leveraged ETF’s were devised by the bankers to aid in controlling prices, while whipping up sponsoring bankers more commissions in their brokerage arms, making them a double no no, and portfolio killer. Manufactured volatility in the sector is quite profound when the banking cartel (with the help of bank owned hedge funds and friends) conduct staged raids by selling short both bullion and share proxies in order to create panic amongst the greedy idiots playing these things, which apparently, is just about everybody these days.

Sentiment is always excessively bullish in precious metals derivatives markets (with the exception of the futures market), which is heavily manipulated by the banking cartel to counter this risk to them), as you would know in reading my ongoing work on the subject, which means all the bankers need do is have the hedge funds tip these knuckleheads over at opportune times and prices have a tendency to cascade lower. And again, not only accomplishing price suppression (to give the false appearance inflation is under control), but making their brokerage arms lots of profits that otherwise not be the case if people just bought bullion, generally not traded, which is also the case regarding direct share ownership as well. (i.e. investors are buying for longer term hold periods.) But with the financialization of the economy, and so many traders now in the system attempting to make a living trading, unfortunately precious metals have been captured by this negative circumstance set, and it appears as if it will be with us until something blows – like Western bankers running out of bullion.

In this regard then, it should be understood sentiment in the precious metals derivatives markets is still too optimistic to call the group a ‘slam dunk’, especially if liquidity begins to dry up. So, be careful. Again, with margin debt levels at all-time records, the broad equity group has never been more dangerous, especially with bifurcated global monetary policy (quasi-tightening in the West set against hap-hazard policy in the east) threatening to topple credit (in the face of crashing demand) and real estate bubbles in China. And the thing is nobody else that comments on the precious metals space is talking this way, which makes it a genuine risk in my books.

I was there in the year 2000 and lived through the margin related selling after stocks had topped, so I can tell you from first-hand experience it’s no fun. That being said, and as mentioned, if stocks do put in a top this week (or next at the latest), then precious metals shares should have another push higher (along with bullion) no matter what the longer term outcome, and then fail unexpectedly once broad market related selling intensifies. This concern is particularly true for the juniors, especially with the open interest put / call ratio of GDXJ now well back below unity. What should happen to alert you to this possible (if not likely) risk is the juniors should underperform in the next sector-wide advance (watch the GDXJ / GDX Ratio for weakness), that being the signal such concern is valid. Before this occurs it could breakout of a triangle it’s been forming over the past three-weeks or so; however it could always break lower first too. Importantly, this breakout looks like it could occur earlier than Friday, like today, which would make sense if the juniors outperform while liquidity conditions are still good, and then see weakness with the broads.

Just about everybody else is expecting a sudden rush into precious metals sufficient to circumvent faulty and fraudulent Western pricing mechanisms, which may be true for bullion under stressed liquidity related conditions, however don’t let the bankers make a monkey out of you in the shares again, not after the bullshit precious metal share investors had to put up with over the past two-years. Speculators are still too frothy and reckless in the shares for my books, but hey, I could always be wrong. This is of course why I will be looking for confirmation of this thinking in the next sector-wide advance, which as you would know in reading the above, is set to commence as early as today. With the strength in metal prices overnight, it definitely appears today is the day.

Side Note: The bureaucracy’s price managers will allow stocks to be weak, and precious metals strong next week, because this will attract hair-brained speculators, food for the machine, back into making reckless bets in the derivatives markets so the underlying (broad indices) don’t collapse post options expiry, next Friday (the 21st) . Thusly, how things could differ, is these scatter brains could finally be exhausted, opting out this time around, leaving put / call ratios low, and the boys increasingly lonely buyers.

Thus, with all that’s known about the faulty and fraudulent Western pricing mechanisms discussed above, it appears the best strategy for owning precious metals is to accumulate physical bullion, because not only would one be disarming the banking cartel in doing so, not working in a counter-productive manor against oneself, you would also be avoiding the various ‘paper market risks’, ranging from bureaucratic confiscation to security risk (fraud in the case of ETF’s), to market risk(s), including illiquidity, market suspension, and even market closure.

So again, with all that’s known about what the charlatans, fraudsters, and jackanapes have in mind for us, please don’t let them make a monkey out of you – anchor your wealth in gold and silver bullion today – you will not regret this move – of this I can assure you. Because even if not soon, at some point, all the things thinking advocates have been warning of, from the great reset to an good old fashioned bank run, will become a reality.

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