I wrote many years ago that if we saw Germany pivot to the East towards Moscow and Beijing that it would likely be the end of US dominance in the world and would also likely be the end of the US dollar’s dominance in finance. For anyone who thinks this is not a big deal I have big news. It is. The fact that the US dollar has been the world’s reserve currency is what has allowed us to live FAR beyond our means for decades and to export our inflation around the world. This was an exceptional gift that we have not only likely squandered but have actually hastened its demise with our using this advantage as a weapon.

I believe it is likely that we are in the beginning stages of that German scenario right now.

Of course, when I originally wrote this I didn’t know about the SCO (Shanghai Cooperation Organization) or the BRICS countries that would be coming together to already plan for an alternative system.

One reason that this may be a surprise to many is that it has been reported that Olaf Scholz (German Chancellor) has been on a visit to Beijing. The “official” reason seems to be a bit different than what is actually happening.

In an article by Pepe Escobar, he cites “solid German business sources” that this trip is an effort to get China to intervene and help end the war in Ukraine.

Before I go into what he actually wrote let’s keep in mind that the US has done more to destroy itself in the past few years than any external enemy could have ever done. We have weaponized our source of power (US dollar and the SWIFT system) and have driven most of the world away. The majority of the world’s population resides in the areas that comprise the BRICS and SCO. Keep in mind that even Saudi Arabia and Iran (enemies) are all-in on joining an alternative financial system. You can also add Venezuela, Argentina and most of Africa. Even Japan, while not signaling a willingness to join an alternative system, have decided that they will not isolate Russia and will continue to help produce and buy oil from them. At least it appears that one ally has their citizens best interests at heart.

In addition, it is obvious to just about everyone that the West (basically England and the USA) were responsible for the destruction of the Russian gas lines that supplied Europe with a large share of their natural gas. This has led to massive price spikes and has caused many industrial companies to either slow down or halt production because with the increased costs they cannot economically function.

Of course, the USA has come to the rescue with LNG but is charging FAR higher rates than the Germans are used to paying. In news that doesn’t get any attention on the mainstream propaganda media Mr. Scholz and many others have been complaining about the profiteering by the US.

I believe that this somewhat explains why Germany may feel like the attack on the gas pipelines was not only an attack on Russia but also an attack on Germany.

I will now copy what Pepe Escobar wrote:
“According to one of the sources “if this effort is successful, the Germany, China and Russia can ally themselves together and drive the US out of Europe”. I will add that I believe there is similar sentiment to get the US out of the Middle East, Africa and South America.

Back to the Escobar article:

“Another source provided the cherry on the cake: “Olaf Scholz is being accompanied on this trip by German industrialists who actually control Germany and are not going to sit back watching themselves be destroyed”.

Another underreported phenomenon in the mainstream media is the growing discontent and major demonstrations against NATO across Europe. I am sure there are still a few around who remember the horrors of the 1940s and are warning others of it.

It is apparent that, as people can’t pay electricity bills or afford the way of life they have become accustomed to, you can throw all of the virtue-signaling and climate agenda out the window.

To me, this explains a lot in relation to central banks buying more gold in 2022 than in the past 55 years. This, of course, is in addition to record buying for the last 3 years. I believe they know what is coming and it is most likely that most also know about “when”. I believe the record buying by central banks in the 3rd. quarter of 2022 is a sign. Of course, main street folks are the ones selling- most likely at exactly the wrong time.

The main buyers are none other than the countries that are looking to trade amongst themselves with their own currencies with no third-party interference. As I have previously reported the SCO and BRICS are setting up a system in which they will use local currencies backed by the commodities they produce.

As resources become more scarce (most likely by design) I believe that most people are going to want to get tangible VALUE for their labor and products. This is a clear example of how FIAT currencies die. They can conjure up just about any amount they want BUT the Achilles heel is that all that paper (or computer blip) CREATES NOTHING of value. As a matter of fact, each new unit has to steal some “value” from each other unit that is already in existence.

Personally, I believe that we are seeing a debt meltdown that is unprecedented. The only thing keeping rates from skyrocketing and bond values from plummeting is the incessant “printing and buying” by virtually all central banks to destroy true price discovery of just about all assets. This is one reason why investing is so much harder today because in the past (up until about 20 years ago) 2+2=4. Now, whomever controls the “printing Press” could make 2+2= virtually any amount. The distortions are so large that when assets that are propped up fall- they will likely fall FAR more than anyone can currently imagine. Those assets that are being repressed will likely rise FAR more than many can imagine.

A perfect example is in the precious metals “markets” where gold, silver, platinum and palladium trade in paper “markets” where the paper contracts are what determine the price of the physical good- the EXACT OPPOSITE of how derivatives are supposed to work. The physical asset is what SHOULD give the paper its value. Because of this the price changes minute to minute and there appears to be FAR more supply than actually exists.

On the other hand, Rhodium does NOT trade on a paper market. The price may change a few times a week rather than a few times a minute. By the way, Rhodium is trading at over $14,000.00 an ounce on 11-8-2022 (Kitco.com).

The level of fraud in all “markets” is off the charts (as shown by 10s of billions in fines) but in the metals (particularly gold and silver in my opinion) the level of fraud is likely to be exposed in the near future as the unlimited “money printing” is being exposed for the fraud that it is by a lack of supply of basic goods for people to survive. Unfortunately for those who are hoping for brighter days ahead- as I am- I believe there is some serious pain ahead before a rebound can take place. Remember, it is always darkest before the dawn. Also remember that those who can see what is coming and have the foresight to prepare (Definitely NOT following the crowd) will likely fare FAR better in uncertain times.


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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