The world seems to be hurtling towards a series of events that could determine our future for a long time to come. There are rumors that Israel is ready to attack Iran. There appears to be no answer in Ukraine at this point where if either side were to back down it would look like a stunning defeat. China is well known to be wanting to reunify with Taiwan-peacefully or with any means necessary.

These are all stories that are fairly well known. There are other stories that are not as well reported that are just as disturbing but not as well known. An example would be the riots in LA and now spreading across the country. There are reports that these riots are being funded and are planned as opposed to being some random acts of rage. The help wanted ads in Craigslist are an example. The “fact checkers” denials along with other admitting that they were indeed placed leads me to believe the reports.

My first thought was “here goes Soros and his minions again”. In watching some reports there are some “experts” that are saying that these riots- while more than likely having SOROS’ fingerprints on it are also likely being funded by China, Iran and North Korea.

There are reports of hacking, smuggling of biological materials, and other events meant to weaken the USA.

I believe that other nations are smelling blood as our military is thinly stretched. Our economy is in shambles and our only apparent way out of avoiding a default on our debt is to conjure up more cash to pretend that we are still solvent.

Countries and central banks are selling our debt and buying gold along with other currencies.

There are clearly lines being drawn that pit the developed world against the emerging economies.

So, what does this have to do with our investments?

It is really pretty simple. The stock “market” is being propped up with not only easy money but record stock buybacks. Is it any shock that May was one of the best months ever for the S&P when for the first time I am aware of- stock buybacks went over $ 1 TRILLION in a single month. That got the S&P back to around even for the year. This sounds like a last-ditch effort to avoid a massive correction.

Stock markets do not historically perform well when there is chaos. Bonds don’t do well when people start to question not only solvency but what the money they put in today will be WORTH at maturity.

The assets that do perform well during uncertain times have historically been #1 GOLD, and other hard assets including silver and other necessities.

In an inflationary environment, almost all hard assets would appreciate substantially because inflation is caused by a loss of purchasing power in the currency- hence ALL hard assets rise in price. This also causes strain on stocks and bonds because it eats into profits and causes concerns about future solvency.

In a deflationary environment gold would be the major beneficiary as TRUST in the system is lost and many of the promises made to repay are exposed as HIGHLY UNLIKELY.

With the world in chaos, central banks gone wild “printing” money, all of the price suppression of hard assets and the manipulation of stocks and bonds to keep prices high even though the VALUE is likely falling the reversion to the mean should be quite a spectacle.

Inflation or deflation- gold wins. The central banks know this and are doing their best to make sure as few people as possible are aware of it.

Do what they do and disregard what they say.

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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