Wednesday, April 8, 2020

Mike Maloney: How Far Will Markets Drop?

How much further could markets drop? Probably a lot further than you think is even possible, according to Mike Maloney. 

Join him in this latest update as he reveals data that shows this market crash may have only just begun. 

You’ll also get a lesson from Mike on the ‘Hussman Indicator’, plus a double serving of viewer feedback.

- Source, Mike Maloney

Mike Maloney: Is the Covid-19 Cure Worse Than the Disease? Economic Disaster is Here

Is the cure for our economic woes actually turning out to be worse than the disease itself? Join Mike Maloney as he examines a very important article that reveals some of the ‘behind-the-curtain’ action at the Federal Reserve. Today’s ‘Chart of the Day’ is a must-see, especially if you are already a gold investor.

- Source, Mike Maloney

Monday, April 6, 2020

Talk of Gold Price Manipulation is Proving to be Not so Crazy

The disparity between the physical bullion and paper gold market could point to price manipulation in the markets, this according to E.B. Tucker, director of Metalla Royalty & Streaming. 

“The difference between the price [of gold] in New York and the price in London was $70. What that says is that the people that have been arguing about manipulation in the gold market and talking about that for years is not as crazy as we once thought,” Tucker told Kitco News.

- Source, Kitco News

Sunday, April 5, 2020

Walk the World: The New Reality Emerges

The latest edition of our finance and property news with a distinctively Australian flavour.

- Source, Walk the World

Friday, April 3, 2020

Is There Enough Food To Get Through This Crisis?

How's the food supply right now, and what's going to happen as people are bugging-in on lockdown, shutdown, hunker down, stay at home, and shelter in place? 

Is there enough food to get through this crisis? Will there be enough food? 

Brian Ochsner, a high-producing wheat farmer, returns to Silver Doctors for a robust discussion on the state of America's food supply. Is there enough food to make it though the crisis? 

What are some of the things we should be looking out for that spell trouble with America's agriculture? 

What can a person do now right now, and what should a person be doing as we move through the global crisis that has much of America shutdown and on lockdown?

- Source, Silver Doctors

Thursday, April 2, 2020

It's A DISASTER Waiting To Happen: Hours Before Its Start, The Small Business Bailout Is On Verge Of Collapse

Tonight at midnight, the most critical - if hardly biggest - part of the Fed's $2 trillion fiscal stimulus is expected to begin: that's when small and medium business with 500 employees or less can request a loan of up to 2.5x the average monthly payroll (capped at $10 million), meant to buy cash-strapped companies just under 3 months in liquidity. 

As we discussed previously, the loans which are packaged under the SBA's Paycheck Protection Program carry a 0.5% interest rate, and would be forgiven if their proceeds are used toward operational uses such as payrolls, utilities, and rent.

Needless to say, getting these loans into the hands of America's 30 million small businesses is absolutely critical: they employ about half of U.S. private sector employees, according to the Small Business Administration website.

There is just one problem: with just hours to go until millions in small businesses across the nation scramble to apply for much needed funding, the program appears to be on the verge of collapse amid what appears to be sheer chaos between the Treasury, the Small Business Administration, and the various commercial banks that will be tasked to loan the action money.

One reason why the program is woefully unprepared for a Friday midnight rollout is that banks that haven't underwritten SBA loans before will need to get onboarded in the system. However, as Politico reports, as of last night, there was no application available for banks to do this, and as CNBC's Kayla Tausche adds, Treasury remains committed to originating these loans beginning tomorrow, despite hiccups.

But wait there's more: as CNBC's Kate Rogers reports, an "official familiar with the Paycheck Protection Program loans rolling out tomorrow says official guidance for banks is not yet finalized" with Kayla Tausche adding that in addition to general guidance, banks are asking Treasury for two specific changes to the small biz program:
  • Smaller banks want higher interest rate so they don't lose money
  • Big banks want "know your customer" rules waived so they can lend to co's they haven't worked with

Meanwhile, with the supply side choked off amid last minute rollout chaos, demand for the bailout cash is exploding with some estimates that as many as $1 trillion in loan requests will be available for the $350BN in "first come, first serve" loans. As Tausche adds, "industry sources say a "feeding frenzy" of small biz demand for limited resources will be problematic for the system, technically" and notes that "executives are preparing for a situation akin to the 2013 roll-out of"

That, for those who may not recall, was an unmitigated disaster lasting for months.

But while logistical issues will be overcome, a potential dealbreaker of a problem is that the physical source of new loans is getting cold feet. According to Reuters, thousands of U.S. banks, including some of the country’s largest lenders, have said they may not participate in the federal government’s small-business rescue program due to concerns about taking on too much legal and financial risk.

While the Trump administration has said it wants the loans disbursed within days, bank representatives, as well as thousands of community lenders, have expressed serious reservations about participating in the scheme in its current form and called that deadline totally unrealistic.

Their biggest concern is that the Treasury Department said on Tuesday that lenders will be responsible for preventing fraudulent claims by verifying borrower eligibility, which is determined by a few measures including the borrower’s number of employees and its average monthly payroll costs.

That's not all: banks also must take steps to prevent money laundering and terrorist financing, a process that would normally take weeks, the sources said. Additionally, banks are concerned they could face regulatory penalties or legal costs down the line if things go awry in the haste to get money out the door. But at the same time they are worried they will be blamed for not moving funds fast enough if they perform due diligence the way they would under normal circumstances, the sources said.

Then there is the mandated interest rate on the loans: community banks said the Treasury’s guideline interest rate of 0.5% will be unprofitable, and that many small banks will not have sufficient liquidity to front up the loans (this, as we said yesterday, may have been a primary consideration for the Fed to release Treasuries and deposits from the Supplementary Leverage Ratio test, effectively opening up over $1 trillion in additional loan capacity across the US banking sector).

"Taking all of the above concerns into consideration, many banks have already indicated that they will not be able to use the Program under the current terms,” the Independent Community Bankers of America wrote to the U.S. Treasury and Small Business Administration, which are jointly administering the loans program, on Wednesday.

“We strongly recommend that you make changes to the guidelines before the Program goes live so that it will work as intended by Congress,” the group, which represents thousands of small banks across the country, wrote.

Alas, that is impossible as going back to the drawing board would mean days if not weeks of additional delays, which for an economy where every hour matters, is simply not feasible.

Still, as Reuters reports, as of late Wednesday night, after hearing the concerns, Treasury officials are considering withdrawing Tuesday’s guidance and are working to fix the issues, although as of this moment the same guidelines for the PP program were still in place as earlier this week.

Banks also want a document customers can sign attesting to their eligibility and other requirements, thereby relieving the industry of responsibility for potential misconduct. One source said banks are also seeking a written assurance from the government regarding their legal liabilities and obligations before they agree to participate in the program.

Reuters could not learn which specific big banks are thinking about shunning the program. The Bank Policy Institute (BPI), a Washington trade group, hosted a call on Wednesday during which executives from its members discussed their concerns, three of the sources said. Members of the group include JPMorgan Chase, Bank of America, Wells Fargo Citigroup, Truist Bank and PNC.

“Our banks are committed to ensuring this program works and that all of the operational complexities and process challenges are worked through so we can achieve Congress’s goal of helping America’s small businesses,” Greg Baer, President and CEO of the BPI, said on Thursday.

Which is ironic: back in September 2008 all the banks demanded multi-trillion taxpayer funded bailouts right this instant as the world was going to implode if a few banks went under. However, now that the tables are flipped, and mainstream America and half of all the private sector employees demand a similar turnaround time or else the US economy will truly collapse, banks suddenly think that taking their time, dotting i's and crossing t's is far more important than getting money into the hands of America's workers. Money which, as a reminder, is now of the "helicopter" variety, openly printed by the Treasury, monetized by the Fed, and which can be delivered to banks through the back door if need be.

With that we look forward to seeing how this chaos resolves itself, and the unprecedented anger that will erupt if US banks - so generously bailed out in 2008 - are the gating factor to getting the critical $350BN in relief loans to America's small business.

- Source, Zero Hedge, read more here

Michael Pento: This is a Global Depression, Perhaps the Worst Ever

Money manager Michael Pento has long warned the global financial system was “not sustainable or viable” because of record debt creation. Pento has also long said, “This was the biggest debt bubble in history, and it is going to pop someday.” 

That day has arrived. Now, Pento says, “This is a global depression just like we had in the 1930’s combined with a 2008 style credit crisis. That’s what it is. I was on your program about three months ago, and I predicted a global recession. That was wrong. It is a global depression.

We have learned that the S&P 500 earnings will decrease by 10% in the second quarter. We also know that GDP (Gross Domestic Product) for the second quarter is projected to decline by 35%. 

We also know, according to the St. Louis Federal Reserve President James Bullard, that the unemployment rate in the United States could surge to 42%.

April is going to be a disaster. We are not in a recession, we are in a depression, and it is global in nature.” Pento thinks physical gold and silver are some of the “must have” assets. He has also recently doubled his investment in precious metals.

- Source, USA Watchdog

Wednesday, April 1, 2020

Rob Kirby: Physical Metals Are Decoupling, Paper Prices Are Not Real

Despite Gold & Silver spot prices being smacked down, sound money savers are scrambling to find real metals, and having to pay well over spot to obtain physical. 

What’s driving the new “gold rush,” and what unannounced signals do we see in the debt markets that portend a “black hole” capable of impoverishing the current and future generations?

- Source, Reluctant Preppers

Recipe for Disaster: Supply of Gold Craters as Demand Explodes

While many countries have experienced some form of shutdown in response to the coronavirus pandemic, Switzerland’s case is shaping up to be the most impactful to the gold market. When it comes to gold processing and storage, Switzerland is one of the most pivotal countries in the world.

These sectors, along with dealership, transportation and mining, have all been affected by the crisis. The situation has been worsened due to Switzerland bordering with Italy, the nation that has been hit the worst by the virus. And, according to those in the Swiss bullion industry, investors are having a hard time purchasing physical precious metals.

While Swiss Gold Safe’s high-security gold storage facilities have been doing well, the firm’s brokerage side has essentially shut down. Ludwig Karl, a board member at the company, said that bullion dealers in Switzerland have largely closed up shop due to government restrictions while related firms have minimized their brokerage activities, making it exceedingly difficult for private investors to obtain physical gold.

Although investors tend to opt for the most popular coins, such as the South African Krugerrand or the Canadian Maple Leaf, Seamus Fahy, co-founder of Merrion Vaults, said that market dynamics have shifted to a point where many buyers will contend with any physical gold they can get. The supply glut comes amid a return of buyers to the gold market, with the metal gaining around 8% last week and famous investors like Naguib Sawiris and Mark Mobius doubling down on gold and recommending that others follow suit.

Strategist: $1,800 by the end of the year and $2,000 in 2021 are moderate gold forecasts

TD Securities is the latest firm to issue a bullish gold forecast as the precious metals market sheds its losses and returns to the seven-year highs seen around the start of the year. Last week saw gold move up and down as the buying continued, with the metal nearing $1,700 during the week and hitting a high of $1,640 during Friday’s trading session.

According to Bart Melek, TD Securities’ head of global strategy, all of gold’s most powerful drivers were there before the crisis hit, and the metal is likely to continue growing exponentially as the stock market scrambles to find a way to deal with its worst losses since the 2008 financial crisis and world governments waste little time applying heaps of stimulus to their damaged economies.

Last Monday’s announcement by the Federal Reserve that it will provide unlimited liquidity, paired with the Senate’s decision to approve a gargantuan $2 trillion stimulus bill on Wednesday, should be major tells as to where gold’s price is heading. As evidenced by the second half of 2019, gold thrives in environments of low or negative rates, and Melek points out that negative rates are likely to become the norm for a long time. Paired with an expected broad currency debasement and market movements similar to those exhibited during the 2008 crisis, Melek thinks the path is clear for gold to reach $1,800 by year’s end and move on to $2,000 and above sometime during 2021.

Melek advised investors not to pay attention to pullbacks while the pandemic is still ongoing, noting that the blow dealt to the already-shaky mining industry should act as additional fuel for gold’s gains over the long term.

“But, any selloff in the near-term should be considered as temporary, as the previously discussed macro factors and the fact that some six million oz of annualized mining gold production is shutdown due to COVID-19 measures and logistical issues making physical shipments extremely hard, will likely serve as an additional catalyst moving the price toward $1,800 before the yellow metal reaches escape velocity toward a $2-handle,” said Melek.

The time to buy gold is now, says Goldman Sachs

Having made several updates to their gold price forecast before the coronavirus outbreak, Goldman Sachs’ analysts are growing even more bullish on the metal’s prospects as governments begin to deal with the effects of the crisis. The selloff in the gold market was mostly driven by an overwhelming desire for liquidity, yet fiat currencies are likely to lose their appeal as the Federal Reserve and other central banks usher in a period of ultra-loose monetary policy.

“We have long argued that gold is the currency of last resort, acting as a hedge against currency debasement when policy makers act to accommodate shocks such as the one being experienced now,” said head analyst Jeffrey Currie and his team.

Goldman now expects gold to hit $1,800 in the next 12 months as global stimulus begins to recreate similar conditions to those when the metal hit its all-time high. As the team pointed out, the Fed’s announcement that it would unveil quantitative easing in November 2008 acted as the catalyst for the previously-underperforming gold to go on a prolonged uptrend.

Goldman said that gold has responded in accordance over the previous week, posting significant gains as one stimulus after another were announced. Besides being a driver of gold’s gains on their own, Goldman’s team expects the new policies to bring to light the Fed’s ballooning balance sheet and worldwide fiscal deficits, thereby placing both the U.S. dollar and the euro under scrutiny.

- Source, Birch Gold Group via Silver Bear Cafe

Monday, March 30, 2020

Ron Paul: It Wasn't Different This Time... It Was Worse and The Fed Will Fail

It's never "different this time." The Fed's bubbles and busts keep coming and they're getting more intense. Every bubble is bigger than the previous one, as is every "bailout." Every "bailout" carries with it a promise for a future economic crisis. The Fed will fail.

- Source, Ron Paul

Saturday, March 28, 2020

Stocks Crashing? Endless Money Printing is Here to Stay

If Getting Us Into $6 Trillion More Debt Doesn’t Matter, Then Why Not $350 Trillion?

Shortly after 4pm on Friday, president Trump signed into law the $2 trillion fiscal stimulus also known as the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), which gives the Fed the ammunition to issue up to $4.5 trillion in additional debt, a "Multitrillion Dollar Helicopter Credit Drop" as Bloomberg called it, and officially launches not only helicopter money but the biggest wealth transfer in US history, as not only will the Fed balance sheet double on short notice but will unleash an unprecedented spending spree the likes of which not even Alexandra Ocasio-Cortez could have ever imagined would take place.

One person tried to if not stop it, then at least delay and ask the critical questions that everyone else in Congress should have been asking: why are US citizens, who are supposed to be the sole beneficiaries of this emergency bailout act, just a footnote in the gargantuan bill's deluge of electronic ones and zeroes. That person was Republican Rep. from Kentucky, Thomas Massie, who tried to force a recorded vote on the legislation, i.e., a roll coll, prompting a scramble by House members to come back to Washington to form the required quorum of at least 216 members.

Of course, Massie failed, as the vote passed and was eventually signed into law. However, Massie did at least try to bring some much needed attention to what was contained in the bill, and pose some of the key questions that so many others should have asked.

Below are some of his key points:

his bill should have been voted on much sooner in both the Senate and House and it shouldn’t be stuffed full of Nancy Pelosi’s pork- including $25 million for the Kennedy Center, grants for the National Endowment for the Humanities and Arts, and millions more other measures that have no direct relation to the Coronavirus Pandemic. That $25 million, for example, should go directly to purchasing test kits. The number one priority of this bill should have been to expand testing availability and creation of tests so that every American, not just the wealthy and privileged, have access to testing. We have shut down the world’s economy without adequate data. Everyone, even those with no symptoms, needs immediate access to a test.

Of course, to quote none other than Nancy, "we have to pass the bill to find out what's in it", and we are confident that in just a few months, everyone will find out precisely why the bill was so rushed: because out of the $2 trillion, only $290 billion is meant for direct payments to families, which as a reminder was the whole point of the bill.

Massie also pointed out that among the bill's key provisions was the even greater entrenchment of Fed secrecy, a Fed which in theory is there to serve the people yet which has successfully defended against an open audit for over a decade:

This bill creates even more secrecy around a Federal Reserve that still refuses to be audited. It allows the Federal Reserve to make decisions about who gets what, how much money we’ll print. With no transparency.

Massie was referring to the fact that the bill repeals the sunshine law for the Fed’s meetings until the end of the year, or until the President says the coronavirus threat is over, which may very well be never. That, as Wall Street on Parade notes, "could make any FOIA lawsuits to unleash details of what’s going on next to impossible since it has been codified in a federal law." The bill states the following:

SEC. 4009. TEMPORARY GOVERNMENT IN THE SUNSHINE ACT RELIEF. (a) IN GENERAL.—Except as provided in subsection 8 (b), notwithstanding any other provision of law, if the Chairman of the Board of Governors of the Federal Reserve System determines, in writing, that unusual and exigent circumstances exist, the Board may conduct meetings without regard to the requirements of section 552b of title 5, United States Code, during the period beginning on the date of enactment of this Act and ending on the earlier of— (1) the date on which the national emergency concerning the novel coronavirus disease (COVID–19) outbreak declared by the President on March 13, 2020 under the National Emergencies Act (50 20 U.S.C. 1601 et seq.) terminates; or (2) December 31, 2020.

This would also mean that US taxpayer will never learn why they went into debt to the tune of $454 billion, which would then be levered 10x by the Fed to issue up to $4.5 trillion in loans to companies the Fed deems appropriate, if no records are being maintained.

However, Massie's final point that was the punchline:

If getting us into $6 trillion more debt doesn’t matter, then why are we not getting $350 trillion more in debt so that we can give a check of $1 million to every person in the country?

Here the Kentucky Representative hit the bullseye, as this is precisely the endgame. However, since one can't unleash the full $350 trillion overnight without classical economists admitting the truth about what the real nature of this bailout is, it will be done piecemeal with other crises, and other "unprecedented" emergencies emerging in the near future and unlocking the path to what is the real goal of this unprecedented reflationary bailout of the world's most indebted nation. It also indirectly addresses Massie's final point:

This stimulus should go straight to the people rather than being funneled through banks and corporations like this bill is doing. 2 trillion divided by 150 million workers is about $13,333.00 per person. That’s much more than the $1,200 per person check authorized by this bill.

Indeed, the math is simple, and the stimulus isn't going directly to the people for one simple reason: that's not its purpose. Instead, its purpose is to not only provide trillions in corporate welfare, but to greenlight self-reinforcing helicopter money whereby the Treasury will now have to issue trillions and trillions in debt and the Fed will have to monetize it or else interest rates will explode.

Of course, this arrangement may prompt other questions, like for example "why pay taxes if the Treasury can just print whatever debt it needs, and the Fed can just buy it", something we have said for over a decade, but we will leave that particular train of thought to another enterprising politician to address... and be ridiculed.

And in case anyone still hasn't figured it out, the whole "republican, democrat" split of the population in two rival camps is nothing more than theater meant to distract while those in control loot not only the here and now, but also rob the future generations blind. Because the sad truth is that behind the fake veneer of either progressive ideals of conservative values, politicians on both sides have one simple directive: to perpetuate the broken status quo for as long as humanly possible, and get as rich as possible in the process.

- Source, Zero Hedge

Friday, March 27, 2020

Ron Paul: The Coronavirus Profiteers

Now that the coronavirus scare has much of the country fearful and sheltered-in-place, there are more than a few special interests that are profiting massively from the "Emergency State" that has emerged. 

Crony capitalists, corporate criminals, Keynesians, big brother government advocates, previously unknown minor county officials...there is plenty of profit to go around.

- Source, Ron Paul

Wednesday, March 25, 2020

Is China Attempting to Accelerate the Bankruptcy Of the United States?

As the world’s rapt attention is fixated on the pandemic, an economic and financial tsunami is just starting to wreak unfathomable havoc on our lives from here forward. 

What will become of our jobs, our homes, our earnings and savings, our investments and pensions, our retirement accounts, our freedoms, and our society, now and in the future? 

What can we do to protect ourselves and our families? Jerry Robinson, economist, trend-trading coach, and author of “Bankruptcy of Our Nation,” returns to Liberty and Finance / Reluctant Preppers to share his analysis of our convulsing economic landscape, and what we can do to live and prosper in it.

Deflation Nation: Gold and Silver Coronavirus Market Update

Deflation first, then big or even hyper-inflation. That has been Mike Maloney’s ‘most likely’ scenario for almost fifteen years, and it now appears to be playing out. 

Get an inside look at what this short-term deflation could mean for you, your family and your country in today’s update from Mike.

- Source, Mike Maloney