“Greek Fire” Contagion Spreads Through Europe

fire contagionWell, brothers, it has finally begun.  The moment that all of us “crazy” stackers have been stacking silver for in the first place, has now arrived: the beginning of the end of Bretton Woods II, is upon us. 
Everything is about to change…  

 

Submitted by The Wealth Watchman:

For the Greek referendum (which I predicted over 6 weeks ago) has now been announced, and officially approved.

What more is there to say that hasn’t already been said?  Everything is about to change.  So many aspects of life that literally everyone you know(and perhaps even you yourself), takes for granted, are about to shift gears forever.  It’s not that big of a deal though, right?  Everyone’s prepared for this titanic collapse already, aren’t they?

The truth is that no one’s prepared for what’s happening!  In fact, just last night, my brother had a disturbing conversation with a stranger, who was FREAKING OUT over Greece!  This man was literally beside himself with fear.  And what was the reason for this man’s terror?  Ugh, that’s the worst part of all…

Getting Greece Wrong

Apparently this poor soul couldn’t stop panicking, because he’d personally just invested $15,000 in Greek equities (that he couldn’t afford to lose)!

“You’ve gotta be kidding me, Watchman!  Why would any living person with a functioning brainstem actually sink good money into Greece right now?”

I know, right?  Wait though, this man’s reasoning will astound you.  For you see, in his mind, Greece was cheap!  After all, he thought that things had gotten so bad there over time, that he felt he would “get the most for his dollar” by playing the Greek story!

This man thought:

That things had been so bad for so long, that it “obviously” couldn’t get any worse!  

That Greece was so low, it had simply reached a price bottom.  

That the can would be kicked yet again.

That central banks would again sprinkle their magic credit dust, causing both confidence and economic activity to fly.

Brothers, pay attention to every one of those lines, and then ask yourself:

Have you thought any of those things as well during the past few months?  

Be honest, now!  I daresay that many of us have been tempted to think them too. 

Even though all of us in this space have known how the game would end in Greece, so many still predicted that “the can would be kicked’.  After all, it had happened so many times, that even those who knew what was happening, had almost become completely apathetic to Greek events…

That’s precisely why last weekend’s announcement was such a big deal: no one was ready for it.  No one thought Syriza meant business.  Everyone believed that the action of a referendum or exit would simply be “too painful” to actually go through with.

This announcement is now destroying an enormous lie that central planners have been repeating every moment, day after day, for many weeks, in the hopes of forestalling the ultimate panic…

Priced In?

That main lie, of course, being that Greek actions and scenarios were already “priced in” the broader markets, and that there would be no contagion to speak of.

Well, hmm, let’s see, does this action appear “priced in” to you?

German bonds, the largest, sovereign debt market in Europe, is trading like a “pink-sheets”, penny stock!

Barn burner 6

All the while, Germany equities are cratering!

Barn burner 8

The bonds of other “PIIGS” nations, such as Spain & Portugal are flatlining, and their yields have now basically tripled in the last 60 days.

The Japanese equity market, one of the largest on earth, cratered over 700 points at one moment last night…

The Chinese equity market is taking its quickest plunge in nearly 20 years!

Now, hot off the presses, we learn this:

“Several Italian Banks have Failed to Open”

 

Remember, just yesterday, the Italian banking sector assured Italy’s citizens that “exposure was low” to Greece, and that the fears of contagion were utterly overblown.  Now, apparently that reality has set in, the depth to which some bank stocks have plunged in such short order, forced some of them to halt or delay even trading on their stock market.

The failures on the European scene are now coming hot and heavy…and just think….

Friday morning, the world still thought a Greek deal was the only likelihood!

That’s how fast the entire world can change now….

That’s not even the most stunning part though.  With the advent of “Greferendum”, and a potential Grefault on the horizon, other nations are also “coming out of the closet” now too, about their own debt situation!  For instance, just overnight, Puerto Rico announced that their debts(which total over a staggering $70 BILLION dollars) are simply not payable!  Nor are they willing to “kick this can further” either!

Funny huh?  

It’s almost as if everyone was waiting for the Greek event to occur before making their own similar announcements, isn’t it?  Greece is giving other bankrupt entities the ultimate scapegoat with which to “blamelessly” announce their plight, and solution.

No one wanted to be the first one to get this global collapse rolling, but now that it’s begun, expect to see far more cases of governments finally admitting what we stackers have known all along!

“Well, Watchman, everyone’s hitting the panic button over nothing, there’s a still chance that the Greeks won’t actually vote to choose the Drachma, or leave the Euro.”
Look, here’s what you must understand about the upcoming referendum…

The Referendum

Let me make this crystal clear: the referendum itself is now almost irrelevant to the larger picture!  It almost no longer matters how the Greeks vote here.  

The Greek banking system is toast, completely and utterly insolvent.  The ELA has been 100%+ burned through, and no referendum result is going to change that.

Portugal, Spain, and Italy will shortly go the same route as Greece, both in banking, and in bonds.

The central planning firefighters will attempt to stem the tide, win a few battles, but ultimately lose the war and be caught up in this massive conflagration.

The contagion and fallout over the coming weeks, will ensure that larger EU banks and members all experience the scorching flames.  No one will be left untouched.

Even if the Greeks vote in a manner which pleases the Troika(coupled with unbelievable new QE measures), it will only succeed in buying precious little time before the rest of entire Eurozone edifice is ashes.  Confidence was the only thing keeping this facade together, and trillions of euros in fraud was the only thing upholding that fragile confidence.

Here is the truth: the system was so fragile all along, that the mere act of refusing to pretend that things were ok, was enough to apparently annihilate it.  

While insiders are panicking, the common man on the street still has no idea what is about to happen. I highly suggest you finish making whatever preparations and plans that you intended to, before your neighbors figure it all out.

Conclusion

I promise you, this party hasn’t even started yet…neither the referendum, the debt repudiation, nor the Grexit have, in fact, even occurred, and yet the ATM’s are already empty, the Greek banking system is empty, lines for gasoline and groceries are now in full swing, and bond and equity markets are already spiraling.

Again, nothing has even happened yet!

I want to caution folks about getting optimistic about the price performance of precious metals just yet.  Do not wait on pins and needles for gold or silver to make their “moonshot”.  You can bet your last gram of silver, that these governments all still have active “plunge protection teams”, furiously bidding up crashing equities, bidding down precious metals, and pouring trillions into key debt markets…I continue to say that the these markets will be rigged as much as possible, until the last few minutes this system has.  If the central planners don’t do this, too many sheeple will escape.  This collapse, in fact, could take 3 to 6 months to play out, as it did in 2008.  

As Ed Steer says, if governments and central banks weren’t piling down on everything that wanted to soar, and levitating everything that wanted to crash….the entire world economy would be a smouldering ruin in 5 business days.

He’s exactly right about that.

Remember, the insane times haven’t even begun.  My advice is to be wary, but be at peace. I’m in constant prayer to Christ during these times, thinking of the countless folks I’ve never met, who will suffer to an unbelievable degree.

Don’t let this consume you in the days ahead.  For it will be far too easy to be consumed, if you let it.  If things get all too real, all too frightening….you can always just turn off the computer, right? Go enjoy your family.  Know that you’re in the right, and that you’ve done everything in your power, to take proactive precautionary measures in your own life.

However, I want to warn against one other temptation too, which hasn’t yet arrived for stackers, but soon will:

When silver and gold finally begin to spike, you’ll be thrilled beyond belief, but also relieved that your dollar position is not “underwater” anymore.  The temptation to sell what you have, in order to “lock in gains”, will be immense.  So please: always remember the poor man in the story above, who bought Greece “because it seemed too cheap”, and don’t be the chump to sell silver or gold, “because it seemed too high”.

Hunker down, stay frosty, and vigilantly hold what you’ve gathered, until what must come to pass has finally played out, and the dust has settled.  On the other side of this inferno, a desperate world will need real ideas, guidance, and tangible capital to make them a reality.

When this raging fire finally burns itself out, we should all be there on the other end, to help a grieving and broken world turn on the lights…

Hugo 5

PrivateerSDBullion