Fed May Keep Stock Market Propped Up, But Can’t Fend Off Coming Mad Scramble Into Gold & Silver

SD Outlook: The Wuhan Coronavirus unknowns are compounding, and uncertainty in the streets will quickly turn into panic in the markets…

Wow!

There are a ton of unknowns.

How the heck is Wuhan Coronavirus transmitted?

Well, according to the CDC, who the heck knows?

Like, quite literally, that’s the answer.

From the CDC:

How 2019-nCoV Spreads
Much is unknown about how 2019-nCoV, a new coronavirus, spreads.

I recall from time taking calls on the CDC National HIV & STD hotline that HIV is not spread through saliva, but Wuhan Coronavirus seems to be.

What about other body fluids?

Must it penetrate mucous membrane lining?

There are so many questions and pretty much zero answers, except that which is not yet not made public.

Some people in certain government agencies know things, but they’re not telling us.

So let’s not get it twisted: There will be a ton of good information, bad information, misinformation, cover-ups, propaganda and outright lies related to all of this.

Here’s a couple things that are also unknown:

What is the treatment?

That’s right, because according to the CDC, there is no specific treatment.

There is really only “supportive care” (notice the CDC’s  “Guidance for healthcare professionals” is current as of Sunday, February 2nd):

Updated February 2, 2020
Limited information is available to characterize the spectrum of clinical illness associated with 2019-nCoV. No vaccine or specific treatment for 2019-nCoV infection is available; care is supportive.

I imagine supportive care would be things like fever control, IV fluids, oxygen, and those measures.

Side note: Why do so many people compare Wuhan Coronavirus (2019-nCoV) to SARS?

Because that’s how the CDC is approaching the situation:

The CDC clinical criteria for a 2019-nCoV patient under investigation (PUI) have been developed based on what is known about MERS-CoV and SARS-CoV and are subject to change as additional information becomes available.

Of course, I have much more to say about transmission, treatment, some of the “conspiracy theories” out there and more, so please join Mike and I for Silver Doctors Live at 11:00 a.m. EST on our YouTube Channel where we discuss the Wuhan Coronavirus and what it means for the markets and the economy.

I bring my prior knowledge about the subject matter with me, and Mike brings unique perspectives, such as what the Bible says about stuff like this and how people outside of the United States are coping.

Link to the Silver Doctors YouTube Channel.

Link to our last Silver Doctors Live from Friday, January 31st.

Here’s a snapshot taken this morning from the Johns Hopkins tracker-map:

Looking at those numbers brings more questions to mind.

For example:

  • What does “recovered” mean?
  • Can the individual still transmit the virus after “recovered”?

I bring up those questions, again, thinking about HIV.

Things could have changed as I have not kept up on the latest and greatest efforts in the fight against HIV, but at least 20 years ago, there was no “cure”, which would mean it’s a chronic disease, and if this Wuhan Coronavirus is transmittable when a person is not showing signs or symptoms?

Yikes!

*****

Tin foil hat time: There are reasons I keep making the comparison to HIV, and I’ll discuss more of that during today’s live-stream.

*****

We have received some emails from people reaching out to us, and quite frankly, people enjoy calling-in to the show because it’s hard to discuss this stuff in a way that considers all possibilities.

I do apologize in advance if this Outlook reads like a shameless plug – there is a point here: In my opinion, this Wuhan Coronavirus has the potential to spark the “crack-up boom”, where everybody scrambles to buy anything and everything in sight as they flee from rapidly devaluing paper currency.

What would rapidly devaluing paper currency be?

Cash, money in the bank, stocks, bonds, and those kinds of things.

What would people scramble into?

Anything and everything real, but the key word is “real”: It can and will be things like food and other perishables, but it could also be pretty much any basic universal durable good, with the caveat that it depends on what’s available where one lives.

Gold & silver, however, are the most universal of all, because they are, in their very purest forms, money, and there will be a scramble into real money.

A mad scramble.

OK, “Hey Half Dollar, why do you say the Wuhan Coronavirus thing can spark the crack-up boom?”.

Good question, and I say that because of the unknowns.

The unknown can wreak havoc on the mind, which can cause a person to act a certain way or do a certain thing.

That is to say, there are just too many unknowns about the Wuhan Coronavirus right now, and that’s the dominate thought of the day, and if that translates into unknowns in the markets or the economy, we could really see a scramble here, as in the crack-up boom, followed by the economic collapse.

Here’s an example of an unknown, and it’s a big one:

Will the stock market crash because of this emerging global pandemic?

It could.

Well, why is that?

That’s because some companies could be suffering extreme losses at this time, a time of record high stock valuations (i.e. a very expensive stock market), so some smart individuals will sell their stocks now, at all-time record-highs after the longest bull run in U.S. history, and that money will not flood into other paper assets this time around, but, most likely, will flood into gold & silver for the myriad reasons people demand precious metal.

Notice the Heartbeat of America index plunging already:

Rumors are there are cases in New York.

Is America ready for Wuhan Coronavirus Hysteria?

I think it’s coming, regardless.

If so, the VIX will start surging higher:

It comes down to a question of timing, however, and since I’m not on the inside with direct knowledge of the plan, well, there’s a reason I don’t have a dollar in the stock market.

The funny thing is, to me, that the cartel thinks it will have the ability to turn this into a controlled demolition.

Sorry.

These ain’t towers.

They’re “markets”, and they will come back.

Yield on the 10-Year Note is about to really start plunging:

 

I think we take-out that Summer of 2016 (pre-2016 election) low of 1.34% in a hurry, and isn’t it interesting how perfectly yield is playing into the US Government’s hand?

It’s not quantitative easing.

It’s not a pandemic.

It’s not a war on savers.

Ugh.

I just don’t see the US dollar strengthening here:

Think about the general narratives: China brought the world out of the Global Financial Crisis, the US showed the world how to pick itself-up from the Global Synchronized Slowdown of the last few years, so now, it’s time for the next region to shine.

Europe?

A strengthening of the Euro, contrary to the consensus calls for the Euro’s guaranteed collapse?

Maybe, in the long-term, but in the short term?

Hmmm.

I’ve been saying I think the double-bottom holds in copper:

The cartel will need the copper mines cranking out metal in order to supply the physical silver market.

But then again, when the cartel loses control, they may also simply walk-away and pass the baton on to the next cartel.

OK, “Hey Half Dollar, what do you mean by that?”.

Well, governments will always attempt to control gold & silver, but it’s like that saying “he who holds the gold makes the rules”, so when the cartel loses control, it’s because they no longer have, or are willing to let go of, physical gold & physical silver.

Therefore, whoever has the most gold will have the most “control” over the gold & silver market, but an important distinction is that when the current cartel loses control of the current paper system, the baton does not get passed without mind-boggling higher gold & silver prices, in part because passing the baton is not the greatest of metaphors.

It’s more like a bully leaving the playground, and a new bully moves-in.

Crude oil is dang close to a 40-handle:

If we are entering a global pandemic, there will in fact be a drop in oil demand, but more importantly, let’s see what happens to the US Dollar because a plunge in the dollar could make oil more expensive, even if not in nominal terms, then in relative terms.

Platinum should find support at $950 and $925:

In my opinion, the next flight to safety to the precious metals, that is, when the retail investor flees paper for the safety of real, physical metal, will include platinum, so any weakness here is a dip-buyin’ opportunity to deeper-pocketed investors.

Palladium is currently consolidating at $2200:

Palladium’s consolidations have not been drawn out to this point, and there’s no reason for me to think this one will be either.

Gold is ready to break-out above $1600:

Gold is performing its roles nicely, and unless this Wuhan Coronavirus is suddenly out of the news, which it really won’t be since the “cat’s out of the bag”, I expect gold to remain bid.

Silver will be the one that shocks everybody:

It’s “precious for a reason”.

Which means that it’s now standing room only in the train:

The train has not left the station just yet, but it will, without notice, and it is filling-up fast.

The bottom line as we find ourselves here this beautiful Monday in February?

The more I look into the Coronavirus, the more I see “unknowns”.

Yet people think this will not spill-over into the “markets”?

I think not only will it spill-over, but much worse!

We could see people fleeing from paper.

And as the mass hysteria sets in?

The crack-up boom begins.

Has it started already?

It may just have.

We’ll know.

Soon!

Stack accordingly…

– 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.

Paul’s free book Gold & Silver 2.0: Tales from the Crypto can be found in the usual places like Amazon, Apple iBooks & Google Play, or online at PaulEberhart.com. Paul’s Twitter is @Paul_Eberhart.

***