Source: Robert Broncel
This exciting “boys’ book” is not over yet, but we will find ourselves in the final chapters. The “to be continued” will continue for the time being!
In addition, Nippon turned out to be absolute today with a price jump of 27.27% (in percent). High flyer from the Canadian Stock Exchange. It is not yet possible to say whether this is a precursor to new developments, but this movement has certainly been noticeable. We hope to have further contact with John Stella, Nippon’s Investment Relations Manager, tomorrow.
In the meantime, it emerged that, based on ongoing inquiries, Nippon was ready to issue a new forward gold purchase of 1,000 ounces at the adjusted price of 1,900 CDN per ounce (equivalent to over € 1,200). We will most likely not see this price on the plates again! You can register through me or goudkorting.nl. Billing takes place via Gold Discount using the same escrow route as before, so security!
Over time, one (final) signal after another goes off without the Fed having to crumble despite the interest rate measurement just announced in Jackson Hole. Since the final destination is in sight on departure, only the arrival time of this “most wonderful” trip is uncertain.
The most striking signal was undoubtedly from Warren Buffett’s Berkshire Hathaway, the most successful mutual fund to ever seize the shares of Barrick Gold, one of the world’s largest gold producers. Noteworthy above all because with his statement: “You get the gold out of the ground and then put it back in” nothing in the precious metal (no return). Suddenly he apparently understood the potential of a rising gold price combined with the significant profit potential in this sector.
In addition, the word “endgame” came into play at Bank of America, one of the largest banks in the world. A little late, but obviously given the unbridled monetary policy of the Fed since the 2008-09 crisis, which led to an insane “paper orgy”. The bank has now given up on this policy “An Absolute Apocalypse” and aAs a result, nothing prevents fiscal policy impulses that are financed by more money pressure. “. Or, in our words: “The Fed has really gone off course”. Powells Love letter So intended for the fair is nothing more than a sweetener!
It is well known that a large part of the QE spilled onto the financial markets has disappeared and will remain so. With an interest rate of zero, even a value for money of 100 would not be inappropriate. At the current level of more than 25, an interest rate of 4% would be appropriate, a rule of thumb on the stock market. In the meantime, the exhibition space is secretly alluding to a dow towards 50,000 points. So far, there has been no “irrational exuberance” (1997 statement by former Fed President Greenspan), so that such a position could theoretically be possible. After all, the money now has to go somewhere.
To speak to Trump, we absolutely live Illusory world or better in “two worlds”. However, he should know that the central bank is more than aware of the dangers of this policy, as well as stuck is. See the difference in perception below.
Credit expands and creates wealth for the shareholders while the average person goes down!
A bigger one Mismatch is hard to imagine in this area. For which Gut feeling Is everything ok?
The consumer on Main road has long been aware of the rising cost of living, out of proportion to the official Bureau of Labor Statistics (BLS) figure or the US acronym for Bull shit. If we look at the most reliable results from John Williams Shadowstats (since 1989 – much criticized but never disputed), real inflation including food and energy (!) Has averaged between 4% and 6% since the beginning of this century. For US government bondholders, this translates into an average negative return of 4% to 6% off interest.
Based on the M1 money supply since 1980, we can see from the following graph that the average annual growth until 2008 was around 8.8%. From 2008 to February 2020 this growth averaged 16.6% and from February until today no less than 34% or 68% annually and most likely (much) more at the turn of the year. In other words, the Fed has now managed to sew itself completely into its own inflation jacket in unimaginable ways. The Fed is based on an average inflation rate of around 1.7% over the past 10 years (according to the BLS), which is a significant difference to Shadowstats.
With the successive use of the “free printing press”, the precious metal machines at COMEX and the “payment” of interest, it is now high time to give weight to “the bird” with the inflation figures.
So far, the flywheel of the immense increase in money supply has sustained the perception of deflation. At the same time, commercial banks have doubts about the consequences of lending given the economic downturn. Of course, this doubt also exists at the Fed. As a result, the Fed is buying more corporate loans and commercial mortgage-backed securities (MBDS) to keep banks from breaking out and causing the system in “this region” to fail.
It is now expected that the M1 money supply will increase even faster as a result. Left or right, this policy must ultimately lead to an increasing imbalance in the capital markets. The Weimar scenario in the 1920s, which results from the incredibly high war estimates after the lost First World War in 1918, threatens to come back into the picture after more than 100 years. Even then, there was only one way out: Print money until you had to go to the farm with your cargo bike full of “paper” to take care of groceries that needed more paper when purchased. Back then there was a lack of anything that hadn’t happened yet.
But also more recent examples like the Soviet Union, Zimbabwe, Argentina, Lebanon and Venezuela have preceded us without drawing any lessons: a reconnection with gold after the publication of this connection in 1971 (“temporarily” – Nixon). The consequences of this “omission” now lead to a global “black paper hole”. Such a scenario has never occurred, so it doesn’t seem like a good sign for the future. After the lack of renovation in 2008/09 there is no longer any cure!
While the Covid phenomenon continues, the number of bankruptcies will undoubtedly continue to rise unless the business world can end up permanently in the state safety net (Wish Marxist thinking). In any case, this was not a problem with Morgan Stanley, another major American investment bank, which warned with the words a week ago “The first tradable correction could begin immediately”. Apparently, this bank no longer sees a void after the beginning of this year as the incessant cash flow is still exceptional bullish have been. The news for Morgan Stanley is that every effort will be made to postpone this “correction” for a while for the time being!
Moody’s estimates that more than 10% of companies worldwide are now more or less insolvent. In the USA. is now a serious one Bankruptcy growth industry! Even so, the number of factory orders seemed to have picked up again, but that will most likely have been the result of the financial aid programs. In neighboring Germany, it is estimated that there are already more than half a million companies on the rocks. And according to the Spanish central bank, more than 25% of business is already in the “red zone”. The French aid program of 100 billion (freely borrowed) money could bring some relief in this regard.
There is now a growing belief in an adequate vaccine, which could increase confidence in the economy. If that belief is not true, we are back at the same point. In addition, it is by no means certain when the first vaccine will hit the market and how long it will be before the entire world population can actually benefit from it.
With a monetary system on its feet and an unprecedented sharp slowdown in economic growth (trade war, Brexit, growing corona and an increasing number of bankruptcies) we definitely stay.
It is well known that the monetary policy consequences have led to a permanent decline in the purchasing power of the underlying currencies for years, expressed in a physically proportional increase in gold prices. This underscores gold’s role as a purchasing power barometer, although it is rarely or never mentioned. Only DNB is openly positive about gold.
Assuming the split in August 1971 at a fixed price of $ 35 (Bretton Woods 1944) and a Dow of less than 1,000 points, an investor in pure gold, given the current gold and Dow levels, would have net worth well over twice today Dow hatched. The dividends should then provide the necessary compensation. With this wisdom, you can ask yourself why are you investing in the stock market? Originally because of “our” famous Dutch East India Company, whose shares, which were issued in 1606, were sold like hot cakes on the world’s first stock exchange (built by Hendrick de Keyser) in 1611. The stock exchange was given the function of the capital market, which also means that the “holy ground” of capitalism lies in Amsterdam.
In order to visually slow down the “decomposition process” of the fiat paper again, quick steps were taken again in July and then in August to manipulate gold again below the (sacred) limit of USD 2,000. Heavy resources had to be used for this. This was evident in the enormous Gold swaps the BIS with the highest volume in recent years at 474 tons and probably more in August. A final statement is not yet known. The annual production is barely 3,000 tons.
These swaps are used to gain access to the gold on Bullion banks with which the BIS will open so-called sight accounts for the benefit of the central banks. This also hides the (increasing) chance of a substantial one Mismatch with the outstanding unassigned longs at the COMEX in New York. As long as this game stays intact, it will Bullion banks with gold thread. But like last March. It turned out that this game is extremely threatening difficult become.
It cannot be stressed enough that the constant manipulations are the result of the most “opportunistic” central bank policy of all time, which without an anchor does not restrict the interpretation of the policy space. This creates a communicating vessel in which the intrinsic gold value is closely linked to the continuous devaluation of the “intrinsic” paper value, which has led to a decline of approx. 80% in the last 20 years (see above)!
In order to partially prevent this decline in appearance, almost the entire annual production seems to have been sold “over the counter” this year. The question is justified how much ammunition the Bullion banks still need to be able to keep playing this vicious COMEX game. In case of further growing doubts, the physical demand for supply will (significantly) exceed the available inventory at the right time, and then it will out and over! Gold with silver in the Slipstream can then no longer be drawn. The only respite here especially banque The implementation could then lie in a possible quick processing of the gold, which can be offered on a large scale (?). Just theory.
The row against the tide can also be seen in the graph above, which shows that the price of gold goes hand in hand with the rise in negative real interest rates (interest minus inflation, currently interest plus inflation). This is obvious since precious metal isn’t one Counterparty risk and only requires cost when physical storage is a secondary factor.
With paper returns on fixed income securities such as bonds falling, U.S. pension funds seem increasingly in the red and tend to buy gold to meet their obligations. This “dam break” affects many trillions. So far, only a few funds have dared to take this step.
Should inflation rise without a rise in interest rates, you as a pension fund essentially have no other choice! The dollar will then be the first to weaken further amid continued dwindling confidence in Fed policy, followed by mounting monetary tension stuck in a cluster of factors.