The definition of insanity is doing the same thing over and over and expecting a different result- so I have heard. It appears that those “in charge” have learned nothing from history and are making the same decisions over and over again.

Let’s start in Europe where there is a real threat of people freezing this winter as Russia has stopped all gas exports until the sanctions are dropped. The answer from Europe’s “leaders”? To conjure up cash out of nowhere and “help” those who can’t afford their heating bills, food, etc.

This will likely lead to FAR higher prices because there is NO PLAN to increase supplies and the real problem is lack of supply. Of course, if there was anyone in the EU that would look for peace rather than war we just might get a win-win solution rather than the current state of affairs.

In Japan, they are conjuring up cash in record amounts to keep their bond yields low while their currency- the Yen- is collapsing against most currencies and most importantly, against the US dollar. This is a severe problem for a country that imports most of its commodities.

Here in the USA, we have politicians that would like us to believe that spending an additional $700 Billion will help reduce inflation. It would be hilarious if the joke wasn’t on us. If that isn’t enough there is a proposal to “forgive” student loan debt that could be another 500 Billion to a trillion. I guess that will REALLY help reduce inflation.

These are just a few examples of how foolish we in the West have become. The rest of the world has noticed and are now looking at the East in a totally different manner. I am sure that Putin and XI are well aware of the $41 TRILLION dollars spent and unaccounted for by Dr. Mark Skidmore (Phd Michigan State) and the fact that the West (US in particular) have been using their finances to manipulate prices as well as outbid poorer countries for vital resources.

The West overall has become so brazen that they have been manipulating prices for their own benefit. It appears that now, with Mr. Putin calling their bluff, the game may be ending. Basically, as the EU, USA and a few others try to strong arm Russia with sanctions and “price caps” it appears that Russia understands that the world needs hard assets and real goods FAR more than conjured up cash out of nowhere.  I believe that the world’s consumers are getting a lesson here also. It doesn’t matter how much “money” you may have if there is little to nothing to buy. Ask Venezuela and Zimbabwe about that.

Many people have commented to me “You can’t eat gold”. Pray tell- how can you eat a computer blip?

I also don’t believe a dollar, yen or Euro would be very appealing or filling either. The one thing I know is that as all fiat currencies fail (100% success rate throughout history) gold has been used to re-install confidence in the new system that takes over after the old.

My belief right now is that we are headed for a debt collapse that could lead to chaos on a scale we have never seen before. I also believe Putin, Xi and most of the world’s population see it coming and are trying to insulate themselves and their economies by distancing themselves from the coming carnage.

There will be a BRICS meeting in Uzbekistan next week that could be very interesting after the SCO (Shanghai Cooperation Organization) discussed in early August setting up cross-border trade using local currencies and backing those currencies with commodities produced by those countries. In other words, they will back their currencies with ASSETS while our “money” is actually a DEBT.

Any rational person, company, or country would much rather have an asset than a liability.

WE have been in a debt-based system since 1971 when all ties to gold were severed. As JP Morgan himself said “Gold is money. Everything else is debt”. I believe that this is why central banks and major banks are continuing record buying. They see it coming too.

Because of all the price manipulation the exploration and mining of not just gold and silver but many critical resources like energy have been greatly curtailed because of uncertainty about prices and environmental edicts issued by those “in charge”. Most miners have expenses that take years to pay off and price manipulation makes it extremely hard to predict future outcomes when supply and demand is replaced by “Printing and buying or selling” which is at the whim of speculators who produce NOTHING but skim profits from those producing real goods. I believe the producers are starting to discover their importance and the money “printers” are being exposed.

While the transition will likely not be pleasant in the beginning the world should actually wind up in a better place in a few years when real labor is paid with real money rather than a paper promise.

Many wonder why the younger members of our population don’t seem to have the drive that we seemed to have when we were younger. I believe it is because they sense that they are working for “money” that is consistently becoming worth less every time they turn around. There also is no corporate loyalty to general workers anymore either so why should the laborers have any loyalty to the company?

We have truly lost our way and we will pay the price. The good news is that we have all of the resources to right the ship if we can only find the leaders to unlock our potential instead of destroying it. I believe that we are very near a major turning point that will change our way of life- at least for a while.

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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