John Rubino: When the Dollar Falls Everything Else Falls Everywhere

Financial writer John Rubino predicts, “We don’t have a tool to fix this if the dollar starts to fall. That is the end game scenario in the financial system. 

When the world’s reserve currency starts to lose value and the central bank that’s managing it doesn’t have any way to stop it, then, basically, everything falls apart everywhere.

When it happens, the early stage of it will feel like the past few months here. I am not predicting we are heading straight to a dollar collapse or a fiat currency collapse, but when it happens, it’s going to start feeling a lot like it is now.” 

In closing, Rubino says, “The reason why so many groups are so angry right now is because the system no longer works for most people. 

We have an aristocracy that is harvesting the rest of us. 1% of the population gets richer and richer year after year at the expense of everybody else.” 

Rubino says look for corrections in the gold and silver markets that will be “pretty scary” but adds, “This is a buy the dip market .

The long term trend for gold and silver are in place, and nothing is going to stop them short of their ultimate fair value.”

- Source, USA Watchdog

Ron Paul: The Fedcoin, A New Scheme for Tyranny and Poverty

Gold Bullion Heads Towards All Time Highs, Shatters $1,900 Ceiling

The record high for gold bullion stands at $1,920.70 USD, reached approximately nine years ago in 2011, a price that stunned traders and investors in the precious metals markets at the time, after it peaked and ended there after a spectacular bull run.

Now, we are closing in on that price and the precious metals bull market of 2020 has only just begun in earnest.

Strap yourselves in and get ready for some phenomenal gains.

(Chart source, goldprice.org)

As it stands at the time of writing, gold bullion has shattered through the $1900 ceiling in rapid succession, this comes after only recently breaking through the $1800 mark a short time ago, a level that was previously acting as resistance and as predicted, once solidly broken through, would result in rapidly increasing gains.

Silver bullion has followed in golds footsteps, also experiencing an impressive and rapid acceleration higher in prices, resting at $22.85 per ounce at the time of writing, with a strong potential of breaking above $23.00 per ounce.

These strong moves higher in both gold and silver bullion come as investors begin to realize just how precarious of a situation the world now finds itself in, as the realization of a prolonged coronavirus pandemic begins to truly set in, with more and more health officials stating that a vaccine is not only not in the foreseeable future, but also not even a likely "fix-all" solution, given the nature of the virus.

This comes as the United States officially surpasses 4 million confirmed COVID-19 cases, with Florida being one of the most heavily hit States in recent days, experiencing a record number of deaths.

What this means is further strains on our already crippled economy, what this means is more money printing and bailouts, what this means is more stress and more uncertainty as we head into the future.

In addition to this, interest rates around the world have plummeted, as Central Banksters ratchet rates to all time lows, some even dipping into negative interest rate territory, doing everything they can to help artificially prop up this flailing economy.

Russia’s central bank was the most recent one to take action, lowering its main interest rate by 0.25%, to 4.25%. Which may seem high when compared to some Western nations, but is in fact a record post-Soviet low for the country.

Mark Mobius, co-founder of Mobius Capital Partners had the following to say in a recent Bloomberg interview about investing in gold at this time;

“When interest rates are zero or near zero, then gold is an attractive medium to have because you don’t have to worry about not getting interest on your gold and you see the gold price will rise as uncertainty in the markets are rising.”

Wall Street is finally taking the blinders off, which is why we have seen the recent pull back in stock prices, coinciding with this sharp increase in safe haven assets, such as precious metals.

(Chart source, google charts)

Throwing gasoline on an already blazing fire, China and the United States have once again renewed their spat, going tit for tat against one another in their most recent hostile exchange.

This renewal in tensions comes after the United States government decided to close a Chinese consulate in Houston Texas, citing "spying" concerns as the reason for doing so.

This of course infuriated the Chinese government, who have denied this accusation and in response shut down a U.S. consulate in kind, the Guardian reports;

"Beijing has ordered the closure of a US consulate in south-western China, in a move that escalates tensions between the two countries to a new level.

On Friday, China’s ministry of foreign affairs said it had ordered the US consulate in Chengdu, in Sichuan province, to cease all operations. Authorities notified the US of China’s decision to revoke its consent for the consulate to operate, according to a notice on the ministry’s website."

The question now remains, how much further are these two countries willing to take this spat? Will it spill over and escalate even further than it already has, ending the hard strides that both parties have made toward improving trade relations? We shall just have to wait and see.

Regardless, the prospects for both gold and silver bullion have never looked better, with the world facing crisis after crisis, on a seemingly daily basis.

Precious metals should continue to increase in demand for the foreseeable future in such a climate and thus will offer some of the only true financial protection that you are going to be able to find moving forward throughout the remainder of 2020 and well into 2021.

As always, stay safe and keep stacking.

- Source, Nathan McDonald via the Sprott Money Blog

The Economic And Fiscal Twilight Zone

The latest edition of our finance and property news digest with a distinctively Australian flavour.

- Source, Walk the World

Peak Prosperity: How The Wall Street Casino is Stealing Your Money

Stop me if you've heard this one before. GDP falls -35%, the worst quarterly drop in the history of the US economy.... and the Too Big To Fail banks make record revenues. 

Got that? Over 50 million Americans have lost their jobs as a result of the economic carnage inflicted by the covid-19 pandemic. And yet the big banks are not only unscathed, but positively swimming in profits. We live in a system run by the banks, for the benefit of the banks. 

We, the public, are simply grist for its mill. After all the US Federal Reserve, which wields immense global power and influence as the controller of the world's reserve currency, is owned by its private member banks. 

Should we really be surprised how the banks always seem to come out on top? And while we frequently criticize Fed policy for enriching Wall Street at the expense of Main Street, the banks are also picking our pockets in other ways that the public is largely blind to. 

In today's video, we talk with expert guest Joe Saluzzi of Themis Trading, an expert on high frequency trading (HFT) algorithms. He exposes a whole world of hyperfast technology operating in the markets that most regular investors are completely unaware of and vulnerable to. 

Joe's key takeaway is to realize that the markets, and the financial institutions operating them, are casinos. They have engineered the system to slant the odds in their favor. If you invest your hard-earned capital without clearly understanding the risks in play, then you're the sucker at the poker table. 

And as we do each week, we ask the lead partners at New Harbor Financial, Peak Prosperity’s endorsed financial advisor, to help folks determine how best to invest given the threats Joe details. We also take a close look at the market action since last week, which may have reached the zenith of its "blow-off top" on Monday. 

Big Tech, which has driven the euphoric rally since the March lows, has been struggling all week. 

Netflix just disappointed substantially last night and if more members of the FAANGs release similarly weak guidance in their upcoming earnings reports, the potential sector breakdown we've been concerned about could suddenly follow. 

Suffice it to say, we're monitoring the situation closely.

- Source, Peak Prosperity

Jeff Clark: The Real Crash and How to Hedge with Triple Digit Silver

Tom welcomes a new guest to Palisade, Jeff Clark, who is Senior Precious Metals Analyst of GoldSilver.com. 

Jeff discusses what led him to become interested in mining and metals. He worked and learned from Louis James and Doug Casey and now works with Mike Maloney. 

Jeff cautions that investors should be skeptical of mining companies' claims because they will always place their best foot forward. 

Both Jeff and Mike believe there will be a wealth transfer from fiat-backed assets to precious metals. 

This will overshoot, and that will be the time to pull profits and purchase other discounted assets. 

We could see triple-digit silver since it's a small market and quite volatile. It doesn't take a lot of cash inflows to impact the price. Silver today is valued at $68 billion in above-ground physical metal in coins and bars. 

Compared to the global markets, silver is just a drop in a swimming pool. Jeff discusses the silver mining situation today and the increasingly severe lack of new growth in the industry. 

Investors should consider that it usually takes ten years to bring a new mine online. 

He feels the risk of confiscation is lower today than in the past because gold and silver are no longer part of the monetary base, but it remains a possibility.

- Source, Palisade Radio

Ron Paul: Will the Federal Reserve Cause the Next Riots?

Central Banks Continue to Buy Gold as Global Instability Ratchets Higher

Both gold and silver bullion continue to trade higher at the time of writing, moving in lock step with the ever increasing global instability that the world now faces, with none other than Central Banks leading the charge.

(Chart source, goldprice.org)

The king of metals, gold bullion continues to hold solidly above the $1800 USD per oz mark, with each passing day that its remains above this crucial psychological level helping to underpin its strength.

Meanwhile, the metal of the people, silver bullion has shown even greater strength over this last week, moving sharply higher and now trading above the $19.00 USD per oz level, of which it broke through in rapid succession.

Underpinning these moves higher in both and gold and silver bullion are the plethora of both political and economic instabilities that the world now faces, driven largely due to the incredible strain that the system is experiencing due to the COVID-19 pandemic, of which is diminishing in some parts of the world, while rapidly spiraling out of control in others.

(COVID-19 Daily Change, United States via Google Charts)

Unfortunately, the United States is central to many of these problems, including the rising number of cases of COVID-19, which in many States are now higher than ever before.

This is leading to renewed "lock-downs" in key states, reduced economic activity in others and continued uncertainty in most others.

Meanwhile, the November Presidential Elections are just around the corner, which are expected to end in disaster, no matter which end of the political spectrum comes out on top, as neither side is likely to accept the results willingly.

Central Banks Shore Up Their Defense

With all of this increased uncertainty, it therefore comes as no surprise that Central Banks, as a whole are continuing on with a trend that they have been partaking in over the last number of years, that of being net purchasers of gold bullion.

(Chart source, goldhub)

Chief among these as of lately has been Turkey, of which is experiencing the sharpest percentage point increase in gold reserves, outpacing every other Central Bank in the world by a significant margin.

(Chart source, goldhub)

Throughout the month of May alone, Central Banks added a total of 39.8 tonnes of gold, continuing on with a trend of adding to reserves which was also seen in the months of March and April as well, with the overall average being 35 tonnes per month in 2020.

Although some Central Banks continue to foolishly shed gold reserves, others are only more than delighted to accumulate these sales.

One of these countries, as previously mentioned is Turkey, which acquired a total of 36.8 tonnes in May, while another Uzbekistan, added a total of 6.8 tonnes.

This overall gain in reserves comes at a time when two of the key players, both Russia and China are largely silent and missing from the gold markets, not selling any gold reserves, but also largely not partaking in purchasing as well.

However, this may be misleading, as China oftentimes will go large periods of times without reporting any changes in official reserves, silently accumulating behind the scenes as not to cause a run higher in prices, allowing them to acquire reserves at depressed prices, only then to announce a sharp increase in holdings at a latter date.

Russia on the other hand has been largely missing from the gold markets in 2020, with their Central Bank stating that they are not interested in adding to their position at the moment, however, this may soon be set to change.

The reasoning for this is due to the fact that the Central Bank of Russia recently changed course and acquired a small, however still net positive amount of gold throughout the month of May, totaling approximately half of a ton.

This goes against their recent statements of not needing to add more gold bullion to their reserves and may mark a change in rhetoric, one of which could add significant renewed demand for gold bullion from Russia, throughout the remainder of 2020 and thus send both gold and silver bullion prices to even higher heights.

Expect more demand for both gold and silver bullion throughout the remainder of 2020 and into at least the first quarter of 2021, as uncertainty is surely to only increase in the latter half of this year, increasing the need for safe haven assets, while also increasing uncertainty to all new highs.

Until then, stay safe and keep stacking.

- Source, Nathan McDonald via the Sprott Money Blog

Peak Prosperity: A Titanic Disaster Ahead?

At this point, as go the leading Tech stocks, so go the markets. So much capital has crammed into the tech sector this year that it boggles the mind. 

Tech stocks now make up 40% of the market cap of the S&P 500. And despite their huge size, they continue to race higher. Nearly. Every. Single. Day.

- Source, Peak Prosperity

Nomi Prins: The Banks vs the Price of Silver

Will the Fed, with its “unlimited” power to create currency, save us from an imminent banking crisis, or is it time for each of us to rely on hard assets to save our financial future?

- Source, Liberty & Finance

A Staggering Number of Businesses Are Set to Collapse As COVID-19 Continues to Accelerate

Despite the chaos of the world around us, despite spiking COVID-19 cases, despite record number businesses having to shutter their doors, many never to re-open again, markets continue to remain relatively healthy.

(Chart source, google finance)

This obviously defies all common sense and rationality, but that is unfortunately the world that we now live in, an artificial world, where the markets are driven purely by wild speculation and grotesquely negligent money printing.

Although there is a "recovery" story to be had, we are far from it and the strength of the current state of affairs in the markets is nothing more than an illusion, like so many other parts of our economy. 

The stark truth of the matter is that the world is a mess at the moment, with political strife, upheaval and chaos coming from all directions, and of which we have come no where close to peak boiling temperatures.

COVID-19 Continues to Accelerate Worldwide

One such form of disruption and arguable the biggest problem that the world is immediately facing is the coronavirus pandemic, that although is far less deadly then at first predicted, continues to spike across the globe, with the world suffering from the third straight record jump in new cases of COVID-19.

(Chart Source, Bloomberg)

Although many nations have gotten a stranglehold on the pandemic for the time being, many others, who originally thought to have had the pandemic in check, are finding out that cases are beginning to re-surge once again, as restrictions have been steadily lifted over the last month to two months, depending on the location.

However, there are a few key nations that have never truly gotten COVID-19 in check and are now seeing a drastic rise in both daily deaths and daily new cases of the coronavirus, such as the United States, Hong Kong, Italy, Philippines and India to name just a few.

The United States is most heavily being affected in four big states, including Texas, Florida, California and Arizona, with other states also adding to the total number of new cases in a lesser, but still meaningful way.

This comes at a time when the campaign cycle for the 2020 U.S. elections begins to enter into full swing and as people scrutinize every action or inaction on both the political left, or right.

Businesses Continue to Collapse

The preceding lock-downs and the continued strain that COVID-19 has placed on the economic system has already taken a heavy toll on businesses and of which is only going to get much worse before this crisis fully resolves itself.

We are now beginning to see the first true COVID-19 damages being reflected in large business earning reports and as expected, they are severe.

Besides those who have already fallen victim to the economic disaster, such as Hertz and many other businesses as I previously reported on, Walgreens has indicated the damage that has been inflicted upon their earnings over the last few months, missing estimates wildly.

As reported by Zerohedge;

"Adjusted earnings for Walgreens third fiscal quarter (comprising the three months ending in May) came in at 83 cents per share, down 43.5% YoY. That was well shy of the Wall Street consensus estimate of $1.18 per share. Group revenues rose 0.1% to $34.6 billion, just below analysts' projections for $34.35 billion."

Unfortunately, we should expect a tidal wave of horrendous earnings coming our way, especially when you take into consideration that Walgreens as a business is much better positioned to weather a virus pandemic than other businesses, whose goods would be deemed much less vital during the same period of uncertainty.

(Chart source, Trepp)

As Trepp's recent CMBS (Commercial mortgage-backed securities) remittance report indicates, we have a major, major problem on our hands, as the percentage of CMBS who are now considered delinquent in payment has exploded higher.

This is a level that was not last seen since 2012 and of which paints a very bleak picture of the future for businesses, of which were already under heavy pressure due to the highly competitive and rapidly accelerating online business model prior to the additional stressors of 2020.

In their latest report, Coresight Research estimates that a staggering, additional 25,000 stores may shutter in the remainder of 2020 alone.

Likely, as we head into 2021, things will only get worse, especially if the lockdowns resume come this fall, as the expected "second wave" of COVID-19 begins to accelerate across the United States and other parts of the world, placing the final nail in the coffin for those businesses who were just barely getting by.

Intervention is the Name of the Game

Governments are stuck between a rock and a hard place and many people already believe that they have no choice, other than to let COVID-19 run its course, lest the coming economic fall out result in more deaths than the virus itself. Fortunately, this is not a decision I have to make and I do not envy anyone who has to make this choice, as it is a lose lose situation.

However, all of this negative news is heading us into the direction of more intervention, more money printing, more collapses and rapidly increasing debt creation the world over.

(Chart source, goldprice.org)

These are just a few of the many reasons why we are seeing gold and silver bullion rally higher once again, as people seek safe haven assets to help whether the current storm and the future tsunami that is coming.

Future gains are likely to continue, with a "great reset" higher in prices eventually unfolding in rapid succession, as the masses begin to finally realize the situation the world economy finds itself in.

Until then, stay safe and keep stacking.

- Source, Nathan McDonald via Sprott Money Blog

How to Squash this Stealthy Attack On Your Wealth

You’re losing the war against your wealth.

In 1935, the official price of one gold ounce was $20.67. Today it’s around $1,770.

Price of gold 1935 vs. 2020

What happened?

The ounce of gold didn’t change. One troy ounce of gold still weighs one troy ounce.

One ounce in 1935 is still one ounce in 2020

What changed is the number of dollars it takes to buy one gold ounce. That stack on the left might look big compared to the paltry $20.67 on the right. It’s going to get a lot bigger.

The chart below shows the price of gold going back to early last century. The tiny blip in 1935 was a 69% increase in price at the time. It’s barely noticeable today.

Likewise, a $100 move in the price of gold will someday look like a tiny blip. Don’t let an endless stream of media panics distract you from what’s really going on. That stack of dollars can grow infinitely.

As the stack of cash grows, gold stays the same. Double the number of dollars needed to buy an ounce of gold and the ounce stays the same. It’s the dollar that’s worth less.

Consider this. $1,000 was a lot of money in the early 1900s. If an ancestor of yours had put $1,000 worth of cash away for you, today, it would barely pay for one month of rent at a downmarket apartment. Back then, it was a large sum of money.

However, if your ancestor had put $1,000 worth of gold into an envelope for you, it’s worth more than $80,000 today.

There’s a war against your wealth. The dollars you use to measure the wealth haven’t held up over time. Gold has.

With the U.S. government set to run a record deficit of $3.7 trillion in 2020, according its own CBO (Congressional Budget Office), it may soon take even more dollars to buy the one gold ounce.

- Source, Silver Bear Cafe

Our Wealth is Being Destroyed, is this War Winnable?

Wealth preservation is not just for billionaires; it’s mandatory for everybody, said E.B. Tucker, author of “Why Gold? Why Now?: The War Against Your Wealth and How to Win It.” 

“The average person works for dollars and sweats and works extra hours, and sacrifices today for a better tomorrow in dollars. All the while, dollars are becoming less valuable,” Tucker told Kitco News.

- Source, Kitco News

Production Down Significantly: Massive Silver Shortage Coming in the Near Future?

The overall market cap of the silver sector is incredibly small when compared to other segments of the economy and is thus susceptible to wild swings, manipulation and disruptions. This has always been the case, however, the remainder of 2020 may starkly highlight these problems.

Disruptions in silver supply have been severe over the last few months as the COVID-19 pandemic raged across the world, with some of the largest producers of silver suffering huge setbacks in production.

(Chart source, SRSrocco Report)

Mexico, the largest silver producer in the world saw silver mine production decline by a staggering 40% in April vs the previous years production, resulting in a decline of 199 metric tons over the previous month, which is a significant loss in its own right, but even worse when you consider that this problem occurred all over the globe.

(Chart source, SRSrocco Report)

Peru, the second largest producer of silver suffered even heavier losses than Mexico, with its Ministry of Mines and Energy reporting a stunning 74% loss in silver produced throughout the month of April vs the previous year.

As we also seen in Mexico's silver production, this was a heavy drop off from the previous month, with Peru dropping by 130 tons month over month.

(Chart source, statista.com)

Meanwhile, as seen from the chart above, the next largest producer of silver between the years 2010 to 2019 is China, followed by Poland, Chile and then Russia.

All of these countries, but most notably China, have also suffered heavy damages from the COVID-19 pandemic, with China being the most severe of these, resulting in large scale shut downs across the board within the country.

It is hard to get concrete, solid data from China, however it is without a doubt that similar declines in production, or worse occurred through the last few months as COVID-19 ravaged their economy.

What all of this means is that we have a huge, massive decline across the world of silver production, and of which is likely going to continue to suffer throughout the remainder of this year and possibly even into the early part of 2021.

This comes at a time when we are seeing strong demand for physical silver from silver ETF's, which have had a record breaking increase of 65 million ounces already throughout 2020, with many months still remaining in the year.

Additionally, demand for physical bullion among investors seeking the metal as a safe haven asset is estimated to increase by 16 percent year over year, resulting in a five year high in demand.

(Chart source, worldometers.info)

Unfortunately however, COVID-19, even though people are now beginning to realize that the mortality rate is much lower than at first estimated, is still a constant, persistent threat to the economy as a whole, including the mining sector.

This is resulting in large sectors of the economy operating at reduced capacity, as both manufacturers produce less and people purchase fewer items, meaning less demand for commodities across the board, including silver, which is used in the production of a vast array of products.

Still, it is only a matter of time before this significant reduction in supply begins to be felt by those who require silver to produce their products, especially given the fact that much of the silver produced in the world is simply a by product of base metal mining.

It would not surprise me at all to see silver spike hard in the latter part of this year, as the safe haven side of demand begins to steadily increase, given the uncertainty surrounding the upcoming 2020 Presidential elections and the almost guaranteed chaos that is going to result, regardless of who ultimately comes out as the winner, as I believe neither side is going to simply "accept" the results.

And that is only just one of the many problems, it is predicted by many medical experts that a second wave of COVID-19 is expected to roar back come this fall, resulting in more money printing, more shutdowns and more increased uncertainty in what the future holds for us.

This will result in an even greater reduction in supply, while there is a sharp increase in both physical gold and silver bullion, potentially resulting in significant gains for those who had the foresight to accumulate while prices were "on sale".

Regardless of what is to unfold, uncertainty is without a doubt coming in spades.

Stay safe and keep stacking.

- Source, Nathan McDonald via the Sprott Money Blog

Watch Gold It Is About To Do Something We Never Seen Before

Todays interview is with David Moadel, David talks about the economy, he talks about the gold price on how it is going to move up. Gold is going to move like we have never seen before.

Wolf Street Report: Pending Home Sales Bounce Off Brutal Low, Still -11% from February, -5% from May Last Year

Pending sales of existing houses, condos, and co-ops in May – these are contracts that were signed in May but didn’t close in May – bounced off the brutal pandemic low in April, but remained down 10.6% from February 2020 and down 5.1% from May 2019, according to the National Association of Realtors this morning:

The index of pending sales was set at 100 for the average contract activity in 2001. Pending sales in May are an indication of what closed sales might look like in June and July.

That sales volume collapsed in this historic manner in March and April was a sign that amid the uncertainty, the market had essentially frozen up, with sellers pulling their homes from the market or not listing them in the first place, and buyers staying away in droves.

While many potential sellers still remain reluctant to put their homes on the market, the market is functioning again. The industry has figured out how to deal with the requirements of social distancing, with sellers’ worries about having potentially infected strangers traipse through their home, and with the concerns of everyone else involved in the transaction.

And according to the NAR, “More listings are continuously appearing as the economy reopens, helping with inventory choices.”

The chart below shows the year-over-year percentage change in pending sales. The three months of year-over-year declines during the pandemic – March, April, and May – are marked in red:

In terms of US regions: Pending sales fell in May 2020 compared to May 2019 in three of the four regions:

• Northeast: -33.2% year-over-year to an index level of 61.5.
• Midwest: -1.4% year-over-year to an index level of 98.8.
• South: +1.9% year-over-year to an index level of 125.5.
• West: -2.5% year-over-year to an index level of 89.2.

This market is facing a historic mess...

- Source, The Wolf Street Report, read more here