So many people my age are saying the same thing. We can’t recognize the country that we grew up in anymore. While the changes have been taking place for a long time the massive shifts have become more apparent as those “in charge” are so emboldened that they don’t even try to hide the fact that they are rigging virtually EVERYTHING for their benefit and to our detriment.

I have written hundreds of times about the rigging of stock, bond and real estate markets higher and rigging metals prices lower. As it turns out this is just the tip of the iceberg.

It all starts at the top where central banks conjure up “money” out of nowhere at virtually no cost and buy assets to manipulate prices where they would like them to go (or stay). At that time they own an asset that they bought for virtually NOTHING. The worst part is actually that while THEY own the ASSET WE own the liability. We OWE interest on that “money” that was created out of thin air.

Of course, the central banks have plenty of help in their efforts like their owners- the major banks. As it turns out the major banks have been flaunting the SEC margin rules. According to Wall Street on Parade Archegos (hedge fund causing billions in losses to many players) had leverage of 6 times the collateral they put up. The SEC mandates 50% but through some creative setups this particular fund got up to 80% leverage. This obviously magnifies the gains and now we see what it does when the tide goes out.

It gets even better! Many of these hedge funds are using creative techniques to avoid a LOT of taxes. Again, from Wall Street on Parade re: a hearing on September 22,2014 Steven Rosenthal testified in front of congress that Renaissance Hedge funds often made more than 100,000 trades per DAY and over 30 MILLION trades per year. This is obviously short-term trading and should be taxed at 35% (at that time) while with the help of Barclays and Deutsche Bank they used derivatives in their trading strategy to avoid approximately $6.8 Billion in taxes. According to the senate investigation the hedge fund would open an account and deposit cash while the account remained in the BANK’s name. The bank would then deposit $9.00 for each dollar deposited leading to leverage as high as 20:1. Of course, then the bank would charge interest and trading fees to pad their pockets.

This was 2014 folks. Seven years ago and the same type of games are still being played and likely on a far larger scale than they were then. What we have here is not only parasites that are skimming profits while creating NO VALUE of any kind and distorting all prices on top of it but it also appears they are not paying their fair share of taxes on their “gains” either.

Do you think ANY of us would get away with a scheme like this?

The chasm between the wealthy and the poor has likely never been this drastic in the history of our country. Just yesterday I had the unfortunate occurrence of seeing that Jamie Dimon put out his latest annual letter. If this doesn’t let everyone know how out of touch these clowns are I don’t know what would.

Just a couple of points that made me laugh but then get ill after I realized just how ridiculous this is:

  • Consumers who are now flush with savings will help drive an economic boom. I guess when you are in an ivory tower you are blissfully unaware of the real world circumstances. Are the 40 million at risk of being evicted after the rent and mortgage abatements end saving all this money? Are the 18 million people still collecting unemployment stashing cash- or paying to live? Are the 744,000 who just filed first-time unemployment claims last week going to be stashing cash away? Are the 100 million plus people of working age that haven’t found a decent job in years so they are not counted rolling in dough? As real-world expenses are blasting higher how long will these “savings” last? I guess when you earn 10s of millions per year such things are irrelevant.
  • “I have little doubt that with excess savings, new stimulus savings, huge deficit spending, more QE, a new potential infrastructure bill, a successful vaccine and euphoria around the end of the pandemic, the US economy will likely boom.” In other words, there is NO MENTION of an economic rebound just more of the same shenanigans that have brought us to the edge of destruction. All this is about is more DEBT. What does JP Morgan do? Besides rigging all “markets” for their own benefit and being big enough to make sure it works they LEND and create debt. No wonder he loves this!  In the real world we need a real economy-not the smoke and mirrors he is so giddy about.

It’s easy to pick on JP Morgan because of their 6 felony convictions for their manipulations of just about everything but they are but one of hundreds of banks and hedge funds that are in the business creating wealth for themselves at everyone else’s expense. This note shows just how out of touch most of them really are.

One thing that they are not out of touch with is precious metals- particularly gold and silver. Ted Butler has reported that while JP Morgan has hammered the price lower with paper (not real gold) contracts they have amassed a staggering BILLION ounces of silver for themselves and over 25 MILLION ounces of gold. The central banks have also bought 2200 TONS of gold in the past 3 years.

Hmm.

I have often guessed that they have done this because they know the “printing” has a life cycle which I believe is coming to an end just as it has throughout history when such actions were taken.

The things that have my attention right now are that there is a reported $140 TRILLION missing with $94 million from the dept. of defense. My guess is that “money” was funneled into the derivatives market to prop up the banks. While I have no proof of that where else in the world could one hide $140 TRILLION? (Dr. Mark Skidmore Phd in Economics Michigan State University)

What is our “money” really worth? All economic indicators like stock indexes, money in circulation, the Fed’s balance sheet, and debt outstanding amongst others are all looking like hockey sticks. This is a formation we have seen right before a day of reckoning many times before. Of course, this could still go on a while longer. Who could have imagined that they could have gotten away with what they have so far for so long?

I believe that VERY shortly the US dollar will come under intense pressure and at some point will likely lose its reserve currency status. At that point the inflation that the Fed has been trying to conjure up may wind up getting way out of control. At that point if you are counting on green paper to save you- you may be out of luck. Just like those where currencies have collapsed before found out like Argentina, Brazil, many banana republics, Germany, Venezuela and Zimbabwe.

Personally, I am interested in assets that have to be produced and can’t be conjured up out of nowhere like gold, silver, oil, natural gas, uranium, food, water, energy, etc. and companies that produce such assets. I don’t have to count on another’s promise to repay me and I own a real asset rather than a paper promise.

We got a good look at how the system functions when Gamestop started causing large losses for the wrong people. In the middle of the game the rules were changed to make sure the little guy didn’t get ahead at the large firm’s expense. Do you expect different next time?

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 reliable 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.

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