Greenspan …

Alan Greenspan passed away at the age of one hundred.

Mr. Greenspan was known as the maestro for his ability to manage “markets” higher.

Of course, the fact that interest rates were falling for almost the entire time he was in charge (1987-2006) was likely the real reason.

Just like in 1999- the only year we supposedly had a balanced budget the capital gains from the tech bubble along with some social security money and financial manipulation were the reasons.

Mr. Greenspan, in my opinion, is the person who started us on this “money printing” operation and got the ball rolling to where we are today. Of course, there is no proof that he had any idea that his replacements would have gone as far as they have.

The irony is that if you look back at his writings in the 1960s you will see a man that was what we would term today as a gold bug. He was well aware of the attributes and VALUE of gold. Once he became the Fed chair, he had to change his opinions and do all he could to make gold look bad and the US dollar look good.

I have written MANY times that once you start down the money “printing” road there is no turning back. You either continue to inflate until the currency collapses, or you stop and the economy and “markets” collapse.

I use “markets” because we have not had free markets since around 1987 when the bailouts started and the entire idea of free markets that determined price with willing buyers and willing sellers was upended by an entity (federal reserve) that manipulated prices to get a desired outcome. This is what actually leads to booms and busts. Once the chasm between manipulated prices and actual VALUE becomes apparent, investors head for the door. The “printing” has allowed the illusion of VALUE to go on far longer than a rational person could imagine.

I don’t believe that Mr. Greenspan foresaw the manipulation and “printing” going as far as it has but I also believe that if markets had been allowed to do their job and determine fair prices the booms would have been FAR less but the busts would have been manageable and we would be far more stable over time. It is also likely that our manufacturing base would not have been hollowed out either as the “printing” allowed us to consume without producing. Eventually, it ends up where we are today.

It appears to me that history will probably be kind to him since during his watch things appeared to go pretty well. The blame will probably be pinned on Bernanke, Yellen, Powell, and Warsh.

I have always felt that each new Fed chair has been in the worst position of any of them. It appears to me that Warsh will need a miracle to not have the system implode under his watch. It is always the one who is “in charge” at the time of collapse that gets all the blame.

Even though this has been building in intensity for 40+ years it is likely when this system finally implodes it will be viewed from a VERY short-term Lense.

The clues that we are near an inflection point are:

· Debt growing exponentially with no end in sight and “printing” needed to even pay the interest owed along with current spending. Raising rates would lead to more “printing” to pay higher interest and lowering rates would put rocket fuel under prices. No convenient answer here.

· Interest rates are rising, even with the Fed buying $40 Billion per month (that they admit to)- likely FAR more.

· Inflation (money “printing”) and its effect- prices rising putting even more pressure on rates and the ability of people, companies, cities, states, and Federal government to service existing debt or afford new debt.

· Trust in the long- term VALUE of the dollar in MAJOR question here and around the world.

· Trust in the government keeping promises is plummeting.

· Winners and losers are being hand-picked by those “in charge.” Those closest to the “printing” and those who can play by different rules (insiders particularly in the White House and Congress) can make trades that would land us in jail. Other times companies are rescued and bailed out if they are deemed “systemic.” Many times, that just means “connected.”

· Central Banks- the fiat masters are selling their “product” to buy gold, silver, and other assets. That should be THE sign of what is happening under the hood.

· Private credit collapsing and the appearance of massive fraud is being uncovered. Mortgages that may or may not exist being used as collateral, accounts receivable being used as collateral- sometimes more than once. No oversight. Much more.

The idea of American exceptionalism was built on an illusion of money “printing” where others produced and we consumed by trading computer blips or pieces of paper for assets that had to be mined, refined, shipped, and sold.

The world has had enough of our hubris and are now ready to call our bluff and put an end to the misery we are sowing across the globe.

I do not blame them a bit.

Those who are positioned correctly may be able to amass life-changing wealth with the coming economic changes. Those positioned incorrectly could have major problems.

There is not much that we can guarantee in our business, but one thing is for sure. The next 20 years will NOT be the same as the last 20 years. The tide has turned and those who are in tune with it are changing along with it.

We are in a period of rapid change and that paper promises will be exposed as flimsy at best. Hard assets and destinations where hard wor is rewarded are likely to be the places to prosper in the new reality that is headed our way.

Be Prepared!

Any opinions are those of Mike Savage and not necessarily of those of RJFS or Raymond James. Expressions of opinion are as of this date and are subject to change without notice. The information in this report does not purport to be a complete description of securities, markets or developments referred to in this material. The information has been obtained from sources deemed to be dependable, but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. There is no guarantee that these statements, opinions, or forecasts provided herein will prove to be correct.

Commodities are generally considered speculative because of the significant potential for investment loss. Commodities are volatile investments and should only be a small part of a diversified portfolio. There may be sharp price fluctuations even during periods when prices are overall rising.

Precious Metals, including gold, are subject to special risks including but not limited to price may be subject to wide fluctuation, the market is relatively limited, the sources are concentrated in countries that have the potential for instability and the market is unregulated.

Diversification does not ensure gains nor protect against loss. Companies mentioned are being provided for information purposes only and is not a complete description, nor is it a recommendation. Investing involves risk regardless of strategy.