silver stormIn the long term, Gold & silver prices have dramatically increased for 100 years since 1913, the birth of the Federal Reserve – our inflation machine. Worse, since Nixon abandoned the partial gold backing for the dollar in 1971, the inflation machine has accelerated.
Over the short term, Silver has gained 7.7% in 50 days. I think December marked a double bottom in the silver market, but we’ll know in a few months.
Crashes and large rallies are likely to happen more often in this era of High Frequency Trading and “managed” markets.
The next time you hear from an analyst that silver is likely to remain under $25 for the next decade or drop to $10, or whatever, remember 100 years of history, 100 years of price increases, and 100 years of official national debt exponentially increasing at 9% per year – compounded each and every year.

debt ceilingIn this interview with Finance & Liberty, Sprott’s Rick Rule discusses the coming recovery in the precious metals sector, as well as his view on whether a fiat currency and sovereign debt collapse is dead ahead.
Rick Rule’s full interview is below:

launch rocket verticalThe real price of silver bottomed in 1931 and again in 2001, which could be described as a 70-year double- bottom. That is 20 years longer than gold’s bottom, quite a massive divergence. In 1980, for the first time since the first bottom, silver made an attempt to test the previous highs in place since the 1800s, and actually exceeded it for a while, which is typical of how silver can spike. So, silver actually technically did what gold did at least 40 years earlier.
After the second bottom of gold in 1970, gold started a rally that ended much higher than the previous highs of the 1800s. That is what rallies after valid double-bottoms normally do. Now, as I have said above, silver made the second bottom of its double bottom in 2001, and has started a rally since then. If it continues to follow what gold did, as well as what normally happens after a valid double bottom, then this rally will end much higher than the real highs of the 1800s.
Given the fact that silver has a tendency to spike much more than gold does, then we should expect massively high silver prices during this coming rally.

Reuters/Tamara Abdul Hadi/Files

Reuters/Tamara Abdul Hadi/Files

Ben Bernanke believed that the financial crisis of 2008 produced the need for strong but temporary action to be taken by the Fed. His focus was on providing liquidity to the financial system, as a substantial but temporary strategy.
In contrast, Janet Yellen believes in the Phillips Curve. In the 1950s, William Phillips suggested that there is an inverse relationship between inflation and unemployment, and his ideas are used extensively by Keynesian economists.
The bottom line is that Dr. Yellen is a strong Keynesian who is now in charge of America’s central bank. She believes that real unemployment will fall significantly, if she raises the inflation rate. (Yes, you read that correctly)
That has the attention of powerful institutional money managers, and it should have the attention of everyone in the gold community.

silver smashIn silver, it would appear to the casual observer that the commercials played their old games and started buying longs at the bottom, selling them at the top, then buying shorts as the speculators bought a few longs at the top.  First glance says the speculators were forced out of their shorts.
However, the real story is in gold as silver just reacted to what gold was doing.
This sustained rally might get smashed with a short covering as the banks cannot allow this speculator long buying to get out of hand.

bankrobberyBankers can and will steal your cash, but there is no way they can take your personally owned and personally held gold and silver The ongoing plan for 2014 is to buy and hold even more gold and silver and reduce your exposure to cash held in any bank.  Just keep enough to cover week by week expenses, and keep the rest of your cash at home, under the mattress, in a safe, buried in the backyard, anywhere but in a bank.
ANYONE who keeps money in any banking system in the Western world is sending an RSVP to bankers to access your funds, and they will not disappoint.  The confiscation of Cyprus banking accounts was bandied about as a template for other countries.  “No, that would never happen,” was a constant refrain.  Well, it was just the beginning.
If there is one thing about which you can be certain, concerning cash held on deposit, the government, has plans to steal it.  The bankers new motto:  “What’s yours is ours.”
You think Cyprus was a single event?  It was an elite trial balloon.  The blow-back from it? Not much, really.  Financial shock and awe, to be sure, especially for Cypriots, but just like every other banker-created scam, there are no real consequences.  The elites carefully monitored world response and learned one thing:  more of the same, in some fashion or similar form will work, and we [the bankers] will get away with it.

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gold stormThe financial sky is growing dark.  The stock markets are experiencing volatile trade winds.  The barometer of the economy grows weak as indicators point to another recession looming on the horizon.
The Fiat Monetary System and Derivative’s Monster is heading towards certain death…. it’s just a matter of time.

The Precious Metal Storm is coming… unfortunately, the public is not prepared.

HK JPMThe third JPMorgan banker this month has reportedly “committed suicide”, as moments ago a 33 year old FOREX trader for JPM in Hong Kong plunged from the roof of the JPMorgan Charter House Asia headquarters in central Hong Kong.
The latest death follows Ryan Henry Crane, the Executive Director of JPM’s Global Equities Group, who was found dead last week, and according to a European banking source, worked closely with Gabriel Magee of JPM’s London desk who also happened to recently fall 32 stories off the JPM London roof he did not have access to.
Jim Willie informed SD readers on the recent rash of banker deaths (which has now surpassed 20), that we are witnessing bankers taken out who are on the verge of revealing BIG DATA details on FOREX fraud.
Today’s breaking news that another JPM banker has plunged from the roof- coincidentally a FOREX trader- substantially thickens the plot.

Nixon kissingerBefore 1971 the US dollar was pegged to gold, and foreign countries held dollars in reserve because the US had promised they were “as good as gold”.
The dollar came under pressure because the US money supply grew, but they insisted to keep the gold price at $35. Many European countries were redeeming their dollars for gold, because the dollar was overvalued relative to gold.
By the end of the 1970’s currency war, the dollar had lost more than 50 % of its value in 1981. Devaluation can be a short term fix but, but causes long term problems.

falling-bearSomething negative did hit Bear Stearns in the first quarter of 2008; although there are remarkably few details of what went wrong. Since Bear had a significant presence in sub-prime mortgages and that market was in distress, it is assumed the fall of the firm was mortgage related. That may be true, but there was no general stress in the stock market through mid-March 2008 reflecting a credit crisis. Was there instead some specific trigger behind the company’s sudden collapse?
I believe that sudden and massive losses and margin calls of more than $2.5 billion on tens of thousands of short COMEX gold and silver contracts were the specific triggers that killed Bear Stearns. Let’s face it – Bear was so leveraged that a sudden demand of more than $2.5 billion in immediate payment for any reason could have put them under. Bear Stearns’ excessive gold and silver shorts on the COMEX are the most plausible reason for the sudden demise.

U.S. Drought Monitor California February 11 2014California, the U.S. state that produces the most vegetables is going through the worst drought it has ever experienced.  In addition, the size of the total U.S. cattle herd is now the smallest that it has been since 1951!
Just the other day, a CBS News article boldly declared that “food prices soar as incomes stand still“, but the truth is that this is only just the beginning.  If the drought that has been devastating farmers and ranchers out west continues, we are going to see prices for meat, fruits and vegetables soar into the stratosphere.  Already, the federal government has declared portions of 11 states to be “disaster areas”, and California farmers are going to leave half a million acres sitting idle this year because of the extremely dry conditions.
These extremely dry conditions are going to severely affect food prices. 
The following are 15 reasons why your food bill is going to start soaring…

Image: Jonny O'Callaghan

Image: Jonny O’Callaghan

Money manager Peter Schiff has a read on gold short sellers. Schiff says, “Of course the short sellers never had the gold to begin with!  They’re selling gold they don’t have, and I think the shorts are getting a little bit nervous, but they are going to get a lot more nervous as we turn up the heat here. Gold is now above $1,300 (per ounce).
I think it’s going to be above $1,400 before they start to panic a little bit, and I think that’s great.” Schiff goes on to say, “I like the fact the market is moving up and nobody is buying it, nobody is paying attention to it. If they are, they are dismissing it. People think this is a head fake or a dead cat bounce. Instead, it’s the resumption of the (gold) bull market.
On gold mining stocks, Schiff proclaims, “The valuations are phenomenal in the mining sector because everybody assumed that the price of gold was going to keep falling, and those false assumptions were built into these share prices.
Peter Schiff’s full thoughts on the coming tsunami of inflation, and the resumption of the gold (& silver) bull markets is below:

Bernanke-Dimon-Fed-TunnelThe Gold Cartel, as we call it, has the BIS, The Fed, The US Treasury, The Exchange Stabilization Fund, and various bullion banks such as JP Morgan Chase, as its main operators. Other central banks are called upon to supply physical gold into the marketplace from time to time. They conduct their operations by feeding central bank gold into the market in surreptitious fashion and using derivatives to bomb the paper price. For the time being the paper price greatly influences the physical market and the PM Fix in London, the price at which 90% of the physical deals of any given day is used to conduct business. The good news is Chinese demand is so immense, the physical market is beginning to take over in terms of determining the physical price. This is a main reason The Gold Cartel has been so ineffective this year … and they have tried to keep the price down.
They do what they do because gold is viewed as a barometer of US financial market health. Think of what the media says whenever the gold price is screaming higher. This Gold Cartel wants the gold price as subdued as possible so that it does not effect the US dollar and our interest rates negatively.
There will be gold defaults in the years ahead … whether that be an inability of central banks to get back what they have “swapped” or “lent out,” or from unallocated accounts … the same gold sold by institutions to numerous owners who think it is theirs. All of this is going to lead to the greatest financial market scandal in US history.

In October, we warned SD readers that JPMorgan had initiated capital controls, limiting cash withdrawals, and banning outgoing international bank wires.
The Morgue is at it again, reportedly at the request of the gov’t, as the bank has just informed customers of new capital controls on cash deposits, banning counter credit deposits, forcing customers to provide a photo ID before depositing their own cash into an account, and only allowing customers to deposit cash into accounts in which their name is listed.

EUSSR Flag - Photo by Finn Skovgaard

The savings of the European Union’s 500 million citizens could be used to fund long-term investments to boost the economy and help plug the gap left by banks since the financial crisis, an EU document says.

Becoming more like Europe is not a good thing.  But that is the path that we are currently on.  For the most part, Europeans live in a socialist “Big Brother” system in which the government completely dominates your life from the cradle to the grave.
In Europe, government is god, and everyone and everything belongs to the government.
Apparently, that even includes the life savings of their own citizens.

Jamie DimonJim Rickards on gold & silver’s continued rally overnight Sunday and early Monday while the banks & COMEX are closed:
That’s what happens when you take manipulators’ toys away!

Jim Willie goldGold has been the best performing asset since the Fed tapering began on December 18th, 2013. Most analysts were, and many still are, calling for gold to hit $875 this year. How they arrived at that conclusion is beyond rational comprehension, given that if gold stayed below $1200 for any length of time most gold mines would be shuttered. Moreover, almost every bearish Wall Street analyst never even considers the enormous amount of gold being accumulated by China. I don’t understand how these people can call themselves professionals when they are ignoring two obviously fundamental variables affecting the price of gold.
As we know, belief without evidence is nothing but faith. It would seem to me that Wall Street is exercising bad faith in their assessment of the gold market.

This brings us to Paul Volcker, who chaired the Federal Reserve System in D.C. (August 1979 to August 1987) during which time he shafted gold and silver investors and miners by such low blows including telling U.S. banks to not lend for “speculative” gold and silver buying; and arranging a “bailout” loan for the Hunts in the wake of their crippling margin calls by spring 1980.
The loan was syndicated from various Pilgrims Society members as Alfred Brittain III of Bankers Trust; Sir Dennis Weatherstone of J.P. Morgan & Company; William Ira Spencer of Citibank; and others.  The loan was structured so as to cause the Hunts to be compelled to relinquish some 59 to 60 million silver ounces, which took place by 1986!
All that bullion was of course dedicated to global silver price dampening campaigns.  Volcker became head of the Group of 30 in D.C., representing a consortium of foreign central banks in league with the Federal Reserve System and the Bank of England in suppressing the twin monetary metals.