For those who are a bit disappointed that the price of gold and silver did not shoot straight up after the Basel 3 rules were implemented in Europe on June 28th. I would just say be patient here. These new rules appear to be designed to reduce leverage in the banks and futures market. This will, in my opinion, be long-term MAJOR bullish but could lead to some large up and down moves before the rest of the world joins these rules. Basically, gold is a tier 1 (riskless for capital reserve purposes) asset on the bank’s books. The paper gold contracts now have to be listed as a tier 3 asset meaning that far larger reserves will be needed to continue holding these assets. This does not mean that the banks will run out and buy physical gold BUT it will likely reduce their ability to control the price and manipulate it lower. Of course, the rest of the world has another 6 months to plan their strategy.
I believe it is also worth noting that central banks have flooded the world with funny money and the banks are holding large reserves so they will likely have some time to trim these positions. This could lead to some short-term stagnation in price but will just make the day of reconning that much more powerful.
I continue to see the 4AM and 8AM smashes daily. That is hardly a random event when it occurs almost every day around those times and also around the European close on days when much of the beatdown has been erased.
The paper claims on gold and silver, which are achieved by banks virtually conjuring up gold and silver contracts out of nothing- much like the central banks conjuring up currencies out of nowhere- are NOT backed by any tangible gold and silver. While the banks do have gold and silver the actual amounts could NEVER be enough to do the type of trading that they engage in. This will, most likely, cause these banks to reassess the profitability of this business and they will likely fade over time leading to true price discovery- which we have not seen for decades.
Basically, they are engaged in “naked shorting” where you sell an asset that you don’t own. If you or I tried that we would be locked up for a long time BUT if JP Morgan, et al. do it they are slapped with fines and consider it just a cost of doing business.
My guess is that they have the blessing of those “in charge” Because by keeping the price, particularly of gold suppressed, they can disguise the loss of purchasing power of the US dollar in our case and other currencies around the world. In another act of deception, they measure the US dollar’s worth to other fiat currencies so it appears that they are all fairly stable as they decline in value at different speeds. On days when the dollar “rises” it only rises against other impaired currencies that are losing value faster than ours- hardly a realistic measuring stick of “value”. By the way, what is the “value” of an asset that Can be created out of nothing-Be nothing but a blip on a computer screen and create No value for anyone other than those conjuring it up or their close buddies who buy stuff with it and drive prices up for the rest of humanity. They also manipulate prices up and down to the detriment of almost everyone BUT themselves. Forget about just investment losses because traders determine prices rather than supply and demand but think about the jobs that are destroyed because prices are not determined fairly and basic necessities cannot be produced at a profit so those producing fail to produce.
Keep in mind that all frauds have their own demise built in. This one will be no different. Do you have the patience to wait for it to pay off?
Knowing that gold, silver and other hard assets are no one else’s liability is comforting to know that you don’t have to count on other persons, cities, states, national governments or banks to pay you back when debt is at record levels at ALL levels of society.
AS the folks in charge appear intent on “fixing” our over indebtedness with MORE DEBT it is obvious that this is a mechanism to fool the masses into thinking all is well while the implosion of the entire fiat system is staring us in the face. When it is apparent to the masses that there is no way for the debts to be repaid with currencies retaining anywhere near their current values it won’t matter what games these clowns play because it will be the very source of their power (creating “money” from nowhere and charging us interest on something that really doesn’t have any intrinsic value) loses its illusory value and those who produce real stuff want to be repaid with an asset that they can count on holding its value.
This is becoming obvious as prices of almost everything are rising FAR faster than wages.
We are likely in the very early innings of this loss of purchasing power ballgame.
This debt-based system appears to be on its last legs as the only way we can pretend we can still pay our bills and promises is to have central banks create “money” out of nowhere and actually pay the unpayable bills and promises. As those numbers grow exponentially the masses will awaken to a nightmare that has been brewing since 1913 and is about to undermine our society not unlike MANY other countries have done in the past.
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