bill holterWe will go to bed with Gold at $1,500 and wake up with it $4,000 bid…and nothing offered“- Reg Howe
This quote by Mr. Howe sounds crazy.  It sounds impossible and sounds like the rantings of a raving lunatic right?  Well, no it doesn’t.  Actually, I believe that something resembling this will not only happen but has to happen.  Logically, mathematically and just pure structurally an event very similar is locked, loaded ready for the trigger to be pulled.

Bill Holter

Image: CNN/Universal News

Every market is going in the wrong direction in preparation for what is coming.  Yes I know, this is always how it works when bubbles are being blown.  Money is pouring into bonds in particular, stocks are being propped up and margin balances swollen, people are also being prodded into “selling” their Gold (paper obligations).
As I see it, we are headed directly into a brick wall where everything just stops “Just stops” as in all markets are closed and you have what you have- which will either be marked up…or down on the day that the music starts again.

main eventWhat we have just witnessed in the gold and silver markets was merely a pre-shock warning and a “roadmap” if you will to what is eventually coming.  A mad rush into the metals can begin at any time for any number of reasons.  The list just keeps growing as does the fiat outstanding that will do the “chasing”.  The problem is that as just illustrated, supply has no depth whatsoever and the bottom of the barrel has already been exposed.  The next time a wave of buying hits this market (not that the current wave is done) may be the last time that the demand gets met by supplyOnce supply is gone, it is gone.  This is not like the banking system where a bank runs out of money and calls their central bank for more.  It takes real sweat, labor, equipment and capital to dig Gold and Silver out of the ground, “supply” doesn’t happen with the wave of a magic maestro’s wand. 

EmptyVaultWhen you look at the math, especially the supply/demand and inventory/delivery “math” there is only one question that remains.  The question is not whether the PM’s are grossly undervalued.  It is not whether supply can meet demand.  It is also not whether known inventories can continue deliveries at the pace of the last couple of years.  The only question which remains is “when”.  “When” does the current unsustainable and lopsided (soon to be proven fraudulent which yes, includes “intent”) business model of the precious metals market blow up in a default?
When does it end in the same fashion that every banking panic in human history has seen?

gold & silver sold outThe CFTC IS the watchdog for abuse in the options and futures markets and Friday April 12-Monday April 15 were beyond obvious as to what was done.  Reportedly 1,000+ tons of paper Gold were sold in less than 8 hours of trading.  This is 32 million ounces.  This is 40% or more of ALL Gold produced on the planet in 1 ENTIRE YEAR!  “Who” in their right mind would sell in this fashion?  Who in the world even holds this amount of Gold?  The answer in case you are wondering is NO ONE (other than central banks and THIS may not even be true any longer)!
Forget completely the nuts and bolts, look at this through the eyes of an 8 year old.  The price of the physical metal is different than the futures prices.  ONE of these two must be wrong by definition as they cannot both be correct.  The “price” is and has been “set” by the paper markets.  The “tail is wagging the dog”, this is more than obvious.  The futures markets were set up originally to create liquidity and facilitate suppliers hedging and speculators speculating.  This has gone on for years now (at least since 1996).  Obviously “something” isn’t right when one market has one price and the other another price so …what to do?  Just sit back and wait…for the inventories to be wiped bare.

How does Bart Chilton and the rest of the regulatory crew explain the 2013 instant replay of 2008?  Price gets crashed from “sellers” yet what supposedly was sold can only be bought at a 30% premium…IF you can find it at all?  We are still waiting…and now “Bitcoin” is on the front burner I’m sure that Silver (and Gold) will not be addressed until AFTER exchange defaults occur.  For that matter, they won’t be reported on after the fact either because we will then have bigger, MUCH BIGGER problems facing us…like where the next meal will come from.

The “paper smash” that was surely designed to SCARE investors away from the metals has done exactly the opposite.  It was in retrospect a MASSIVE MISTAKE!  Previous to take down 3 weeks ago we believed that the physical market was “fragile” at best, now we have proof that we were correct in this analysis.  Now the question becomes, “can they put this back into the box?”.  Can they calm the physical precious metals markets?  My guess is that they cannot unless…one of two or both of two things happen.  Some way, somehow “sufficient supply” must show up in the cash markets OR the price must rise (and by rise I mean dramatically) in order to ration out the existing supply. 
Nothing causes a buying panic greater than a shortage.  In other markets a shortage may be just an inconvenience, a shortage in gold and silver will in itself actually create higher demand due to their being Giffen goods.

A complete and total RUN on physical metal supplies and inventories has never ever been more ripe than it is now.  “Is this it?  ..or can they put it back into the box until a later date?
The very real danger now is that what has been started begins to snowball.

survive whats comingThe one chance that you have to survive what is coming is to have wealth that knows no borders, is recognized globally and cannot default.  It is wise to own this in as many forms and fashions as possible with as few intermediaries between you and your wealth as possible.  Don’t trade it, don’t use margin…just OWN IT!

lights outIt is now only a question of “when” that the lights get turned off and deliveries of metals cease.  ABN Amro notified customers 2-3 weeks ago that their supposedly ALLOCATED metal would not be delivered.  How can this be IF it was truly “allocated”?  The only plausible reason that customer “allocated” metal would not be delivered is because it was previously “re” allocated to someone else and is no longer in the vault.  There can be NO other explanation.
As has been said many times before and from several viewpoints, you either have the metal or you do notWhen all is said and done, there will be at least 99 people out of 100 who believe that they own metal who will find out that they do not.  The time to act and separate yourself from those 99 people is now, right now.  Deliveries will fail and supply for new purchases will dry up over night, there will be no “options” once the default is triggered.

MafiaMatt Zames has taken over the 2nd in command position at JP Morgan and replaced Ina Drew.  He has worked over the last year or so to unwind the failed trades put on by the famous “London whale”.  Should Jamie Dimon ever step down, odds are that Mr. Zames will take the reigns.  But Zames also has another job, a “government job” so to speak.  He is the head of “TBAC” (Treasury Borrowing Advisory Committee).  This committee basically decides how much, how long or short and when the Treasury steps up to borrow (never pay down) new debt.  A pretty big job for sure but “someone” has to do it right?
Any conflict of interest here?  Nah, I’m sure that whenever he gets done “advising” the Treasury he would never…NEVER let his knowledge influence the investment decisions at JP Morgan!

Cyprus“It’s” going to happen …because it already is happening and mathematically it had to and has to.
“It” being a complete breakdown of the financial system. 

The fly in the ointment is Europe, or I should say Europe’s “structure”.  The fact that Spain, Italy, Portugal and the rest cannot “print” their way to pay debt service and issue new debt is the detonation device.  It is only a matter of time before another …only bigger, MUCH BIGGER!

priceWhat a difference a few days makes!  I was away for the bulk of this week and had no internet access for 2 days, it looks like the world changed (it did not, only the perception) in the blink of an eye.  2 weeks ago was day 1 of the “2 day smash” in Gold and Silver, here we are 2 weeks later and even the most asleep at the wheel and uninformed can see and knows that the “price” just ain’t the price!

We already know that an ounce of Silver is not worth the $23 that COMEX says it’s worth.  No, buyers-investors-scared fiat rabbits are paying more…30% more for the real, hold in your hand “stuff” that COMEX is so badly underpricing.  Let me go back to the beginning, what is an ounce of Gold or Silver worth if and now when an ounce is not available?

The old saying goes, “there’s no rush like a Gold rush“.  This saying always speaks to “greed”.  The coming Gold rush with its roots in “fear” will be unlike anything before it because in reality it will be an all-out, all-encompassing global bank run!

The cartel showed their hand and the “free press” portrayed what happened to gold and silver last Friday and Monday as a “selling panic”.
They were correct 100% in their assertion…what they didn’t do was tell you who was doing the selling and who was doing the panicking.

gold & silver sold outWe woke up this morning to a “new pricing structure” in the precious metals.  But what has been the response to our “new pricing structure”?  Dealers across the US have sold out of many Silver categories and the premiums have risen sharply.  The premiums have risen just as fast as the paper markets took the price down.  You will still pay very close to or higher than $30 at many shops for Silver Eagles and Maples, junk (if you can find it) is actually higher.  So did the price “go down” for those looking to buy and have it actually delivered?