My Dear Friends,
I started to read my incoming emails on the flight to LA, but soon stopped. Popular delusions and the madness of the crowd has its grip on 90% of the incoming mail.
The equities market has forgotten that even in hyperinflationary super bull equity markets there were sharp step reactions. The negative PR on gold has reached levels never before seen. A major internet based broker on Financial TV advertised it was time to sell or hedge all your gold positions immediately. That is history making when you consider no such public advertisement has been on the media before.
The pressure on gold has left us at JSMineset and our other colleagues on the internet as the only sources able to present the raw facts. Even amongst us there are employees of the Gold banks carrying on campaigns to cripple gold. I assume they are delighted today at our suffering as a rat that plays with its kill.
On the fundamental side there is no development that would suggest anything that is occurring with one exception, and that is QE, which must continue to Infinity or the West faces immediate economic collapse.
History will look back on this manipulation of every market on the planet and people’s reactions to it as not simply a bubble, but a frenzy.
Of others writers on these subjects I know none other than GEAB who has a full grasp of the fundamental issues that markets, no matter how concocted, will overcome. I have advised all my friends to subscribe to GEAB and to ShadowStats.com in order to know the truth of the hidden causes that will defeat the illusion by the greatest injection of liquidity into the financial system in written history.
GEAB said this morning, "When certain countries must protect their economies to survive, going looking for tax revenue in tax havens and, at the same time, paradoxically let their banks use un-orthodox methods to avoid bankruptcy, others have chosen to bet on gold. Whilst paper gold saw a scary crash in mid-April, the demand for physical gold has never been as high, which confirms the complete decoupling between paper gold and physical gold markets. What happens when everyone realizes that paper gold certificates have no physical counterpart? When the title documents to an ingot can’t be honored the paper in question has no value. We must therefore expect more volatility. This is why some brokers won’t allow any leverage on gold paper positions. The decoupling also shows that major problems are ahead because confidence in now shaken.
Physical gold itself has its best days ahead. China has clearly understood this and buys gold en masse."
On the Fed it was said, "the poker game played by the Fed is coming to an end. The bet was that support of finance and real estate would allow a revival of the real economy before having to withdraw this support because of an untenable position going forward. This program enabled the country to gain access to cheap credit, which is already a success. But as regards to the real economy, apart from having caused new bubbles, the bet appears to be lost. As we have seen, the situation hasn’t gotten better, quite to the contrary."
I know it hurts, but stand firm. If you have no margin then you have no debt.
Remember that producing gold companies have physical and will sell at physical price.
Remember that the future of a producing company has a great deal to do with location, location, location.
The politics of gold will have a great deal to do with how well the host country enjoys the fruits of the labor.
Remember some enlightened gold companies have made the host country equal partners already.
Remember that some gold companies are better than good citizens with a long history of significant contributions to the welfare of the people.
Hold tight to these and to your physical. While it is legal store your physical internationally as allocated with people of trust. Ignore the illusion and the Trojan Horses in the gold industry that do not seek your best interest. They have and have had an agenda for a long time. One seeks acceptance amongst the establishment more than anything. They have worked and will continue to work at your disadvantage.