Jim Sinclair: The Federal Reserve Has No Practical Option To End QE Without Collapsing Financial System

The legendary Jim Sinclair has sent another email alert to subscribers regarding the take-down in the gold and silver markets Thursday on the release of the December Fed minutes.
Sinclair states that contrary to the Fed’s MOPE attempting to convince the market that QE will be phased out in 2013 as the economy recovers, There is no practical way that QE can cease here or in Euroland without a total and final collapse of the financial system.

Sinclair points out that the entire derivatives market hinges on the Fed’s unceasing QE, as the moment QE ceases, the US bond market collapses and the Fed must debt monetize all required debt, which means if QE stops, it starts up again immediately and in a crisis mode.

Sinclair states that QE cannot stop or the world as we know it instantly ends, and that the implications to what the Fed has done cannot be talked or manipulated away.  The consequences are coming.

Full alert below:

 

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From Jim Sinclair:

Such an announcement has been part of QE either from MSM or some Fed board member since it began. The implication of stopping QE is so dire to the economy that it is in a practical sense impossible. When gold was being sold by central banks during the 1970s market announcements were made constantly with the bias to depress metals.

 

There is no way that the implications and consequences of what has been done up to now can be talked or manipulated away. There is no practical way that QE can cease here or in Euroland without a total and final collapse of the financial system. Just go back to the IMF report on OTC derivatives I posted this morning. If QE ceases, the US bond market collapses and the Fed must debt monetize all required debt, which means if QE stops, it starts up again immediately and in a crisis mode.

 

I have to admit that if you have been a reader here for any length of time you should know this without asking me. The pressure that people unload on me during any gold reaction is downright mean.

 

The statement that QE can stop is simply MOPE. QE cannot stop or the world ends as you know it.

 

Please print this out and post it on your computer because every time the long cycle guy repeats his year old bear gold price prediction or the Fed says anything about stopping QE, you all go wild. It is embarrassing really.

 

If you do not understand what you are in, why are you in it?

 

Truman said it all when he said if you can’t stand the heat, get out of the kitchen.

 

The Federal Reserve has no practical option to end QE without ending the economic world for decades to come. Should that actually occur in some parallel universe, only gold will protect those citizens from the collapse of the by-default reserve currency. I am sure i have written this at least 200 times.

 

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