SD Outlook: Gold & silver look strong, so let’s understand why the economic collapse will be very brutal for almost everyone. Everyone, that is, except…
Imagine a smart person.
How smart is he?
Well, if you’re smart enough to have the patience of a cougar while the rest of the trading and investing crowd get their faces ripped-off, you’ve got a pretty good grasp of the markets.
But not necessarily the economy.
Now, imagine a similarly intellectually sufficient person.
Person C strikes up the argument, “we never went to the moon” with Person B.
Person B responds, “I’m sorry, the earth is not flat”.
The debate is settled then, right?
Of course not.
The debate never even really began.
Why does it matter?
Because we have some of the very smartest people in the world of trading and investing, engaged in a meaningful discussion on the markets and the economy, yet they have completely missed the point. Since some of the very smartest people in the markets and the economy are missing the point, we can only conclude that the vast majority of all people on this planet do not even know what the moon or the earth are.
So when we hear bearish, bad news talk about the economy, it becomes difficult to understand just how bad things are about to get.
How do I know this?
Because two of the smartest traders/investors around have completely missed the point on market manipulation.
This interview is recommended listening, for the most part because they’re very smart, intelligent traders/investors talking about manipulation (Plunge Protection Team) and gold (both bullish, long gold).
First listen through them talking about the Plunge Protection Team:
Here’s my point – They completely don’t know how to explain the manipulation in the first place, so how could they really know what is about to go down with the markets or the US economy?
For those who don’t know, the principal market manipulative power in the United States is the Exchange Stabilization Fund (ESF), within the Treasury Department. On the surface, the ESF is under the direct control of the President (currently Trump), and the ESF works in conjunction with the NY Fed to carry out ESF operations.
The ESF was created and funded (with Unconstitutionally confiscated gold) in 1934, but since the ESF basically has two sets of books, one minimalist that are open to the public, and the other that are kept under closely guarded secret, what we know about the fund, publicly, is that it can basically intervene in any market it wants, at any time, and for any reason, all of which the ESF does not even have to inform the public of.
You know – for “national security”, “state secret”, or whatever other excuse you want to dish out for the government’s sanctioned manipulation of any and all markets.
My point is that this lack of understanding about the market manipulating structure in the United States means that this economic collapse is going to be way more brutal than even the most gloomy of the gloom-n-doomers is predicting.
Why will it be way more brutal?
Because of the whole “the longer we put it off, the worse it’s gonna be” thingy.
You see, we’ve been on that ESF controlled market-manipulation road for 85 years.
The end of the road is near.
OK, “Hey Half Dollar, yeah, yeah, the economic collapse is gonna suck. That’s all great and all, but c’mon man, Chris & Fleck are both gold bulls, so do they really miss the point?”.
Yes they do.
You see, if you listen to the entire interview, especially the part where Fleck gives his reasons for why he thinks the price of the yellow metal is going up, you will notice one thing that isn’t even considered.
What is not even considered?
Of all the reasons to be bullish on gold, the reset is not even mentioned.
Why does it matter?
Because we know for a fact, throughout all of history, resets happen as the people always return to gold & silver. When the reset happens, you either have your gold (and/or silver), or you don’t.
Many times the analogy is used that you either already have your seat aboard the train, or you will miss the train when it leaves the station.
That’s a good analogy.
Let’s look at some of the most recent monetary resets along with other events worth noting:
- 1974 gold futures market opens for gold price
- 1973 Gold revalued to $42/oz.
- 1971 Nixon closes the gold window.
- 1965 Silver is taken out of coinage (sans a very few select coins of lesser purity).
- 1934 Creation of the Exchange Stabilization Fund.
- 1934 Gold Reserve Act of 1934 (revalued gold from $20.62/oz to $35/oz).
- 1933 Unconstitutional gold confiscation of the people’s gold.
What can we conclude from looking at several of the last resets and other events worth noting in gold & silver?
- Resets happen.
- We are long overdue.
- It is only a matter of time.
Circling back, there are two main points which are critical for understanding what is about to happen to the markets and to the economy.
First of all, the very smartest traders and investors do not even understand that these markets haven’t been free for 85 years, or 106 years if we start from the bastardization of the Fed. Secondly, Resets happen, and not only are we long overdue, but the economy and the markets have been on life support for quite a long time, and not only that, but I think we all understand what “brain dead” means?
And that is exactly what our markets and the US economy have become.
We’re about to find out who pulls the plug.
Interestingly on the calendar of events, we see we’re now getting some November, 2018 data:
Basically, all government reporting agencies have plenty of time and plenty of motives to create whatever narrative they want with the data.
It will be interesting to see how the delayed data compares to the data we get when the government’s all caught-up, which it may never be as quick as our President is with playing the “Government Shutdown” card.
I’m somewhat looking for a breather in gold & silver prices this week, but I’m also bullish, and even more so on the look-out for a continuation of the rally.
I’m not looking for a significant pullback here.
During any pull-back, I would look at that as a place to acquire physical because the overall trend is up.
Silver is in the $15.70s to start the week:
I’m not thinking we get those deep, nasty, smash-tastic candles like we got last April and May, because I think that not only “the trend is your friend”, but I think that silver is also about to put in a “golden cross” on its daily chart.
Furthermore, if silver closes lower on the day to start the week, that’s three days in a row of down days, and if the trend is up, I would assume that dips would be bought, and as dips are bought, pullbacks are not as long lasting.
See what I mean?
Gold is under $1320 to start the week:
But gold is in an even better position than silver here as gold has already put in its own golden cross.
Notice too, this would be the third day in a row of closing down, and if the trend is indeed up, which I think it is, then I’m looking for shallow and not long lasting pullbacks, and as such, I really wouldn’t be surprised to see both gold & silver continue their rallies this week.
Besides, everybody is expecting a pullback, but what if it already just happened?
I think it may have.
Fortune continues to be on anybody’s side who is interested in both investing for the first time, or for getting in on the gold-to-silver ratio arbitrage play:
Right not it takes some 83 ounces of silver to buy one single ounce of gold.
Some time down the line, because the ratio will begin to revert to the mean, it will take much less silver to buy an ounce of gold, and thus silver can be converted into free ounces of gold. This is a long-term arbitrage, so the investor must be willing and able to wait it out, but let me tell you where we are in the arbitrage play –
You know the pirate ship ride at the state fair?
The one that is just a giant swinging boat, that scares the dickens out of most people as it swings back-and-forth like a pendulum?
Well, silver is at the point where the boat has swung as far at it will swing in one direction, and we all know what happens next.
The pirate boat swings in the other direction.
What I am saying is that the gold-to-silver ratio, like the pirate boat ride at the state fair, is about to swing in the other direction.
Palladium is finding support at $1320:
Palladium’s technicals are improving too.
I think platinum can do battle to take-out its 200-day moving average this week:
Of course, that assumes the rally continues this week.
Speaking of taking out its 200-day moving average, here’s the stock market:
There is a major difference, however, between the stock market and platinum’s 200-day moving average.
Platinum is taking out the average coming out of a bottoming, whereas the stock market has taken out the average on a bear rally.
So here’s the question: Is the stock market going to keep on rising to new all-time highs, or is the market going to turn down and head lower?
I think the stock market heads lower.
I also think volatility may finally start getting interesting this week:
I think we could really turn the corner here and start to see some spikes again soon.
I’m not sure.
But I would not be surprised either, especially if the metals continue to rally.
I’m still looking for short-term downside pressure on interest rates:
If we see both a spike in volatility and a significant drop in the stock market, then I’d be looking to take out the recent low in just a few days worth of trading.
I do not think the dollar just put in a higher-low:
I think the dollar just put in a lower-high, and we’re on-route to a lower-low.
I’m bearish on the dollar here.
Copper has had a pullback over the last few days and into the start of today:
I think copper can do battle like platinum at its 200-day, and if copper wins the battle, that would be a nice looking break-out on the chart.
Behold the most epic wall of worry with crude oil:
Crude oil is definitely climbing it.
I’ve been saying upper $70s by Spring or Summer, and while I don’t think it’s wise to forecast both price and time, I’m cool with testing myself like that because I don’t have skin in that crude game.
What’s the bottom line for this week?
Well, it is the start of February, and “Arctic-geddon” or whatever they called it has finally moved-on.
So it’s back to business as usual.
Hit the ground running.
However, as everybody hits the ground running, we must understand that some of the very smartest investors and traders around have absolutely no idea of what is about to truly happen to the US markets and to the US economy.
It is going to be brutal, and most everybody will not be prepared for it.
In my opinion, not being prepared for what is coming will be the difference between suffering and thriving.
Those who have prepared with gold & silver will thrive.
Those who have paper wealth will suffer.
Those who have land and real estate?
They may not suffer like the rest of the sheeple.
But they won’t be liquid like gold & silver investors.
Liquidity is the key to being agile.
Agility is the key to thriving.
– Half Dollar
About the Author
U.S. Army Iraq War Combat Veteran Paul “Half Dollar” Eberhart has an AS in Information Systems and Security from Western Technical College and a BA in Spanish from The University of North Carolina at Chapel Hill. Paul dived into gold & silver in 2009 as a natural progression from the prepper community. He is self-studied in the field of economics, an active amateur trader, and a Silver Bug at heart.