Wednesday, May 4, 2011

Has the Silver and Gold "Bubble" Burst?

The powers that be of the world have been conducting psychological warfare on the plebeians since the dawn of time.

The Egyptian pharaohs had people believing they were either given the divine right to rule or they were demi-gods themselves. Do not defy them.

The Greeks and other Mediterranean state rulers had people believing that they were also the offspring of gods or that through the god’s divine inspiration they were given prowess on the battle field allowing them to rule.

This carried over to Europe where the plebeians were also duped into believing that “nobility” by blood was actually real and the divine king meme was carried on. Largely this thinking has faded away although the Brits seem to still be awe struck with their former master oppressors as evidenced by the recent hoopla after the “royal” wedding. Even in the Middle East and North Africa (MENA) the Arabs tire of the whole strong man, leader type who claims to be president when his entire family constitutes the entirety of the governmental ministerial positions. That’s called a monarchy dressed up as democracy, aka, autocracy. Or, a wolf dressed in sheep’s clothing.

Over time as you witness the actions of these “leaders” you realize that they are quite fallible and prone to the same mistakes and errors of judgment we all make and that indeed that most of them, the more powerful and greedy they become, act the fool even more. Eventually the illusion is cast aside and the “let them eat cake” attitude is discarded and the king and queen lose their heads. Unfortunately the typical plebeian has a short memory span and is lazy and quickly return to their old habits allowing the foxes to rule the hen house over and over. Sad.

So getting to the point, today the primary battlefield is in the realm of fiat currency. You know those federal reserve notes in your pocket (purse)? The line MUST be held or the battle will be lost. The line of course is the price of silver and gold. Fortunately for the modern day plebe, we are living in a time where the illusions are being cast aside and for a short while enlightenment will spread across the land. The masses are slowly but surely pushing the line further and further back. The battle is being won and the elite minority have been in retreat for 10 years now as the silver and gold clad weaponry of the plebeian army pierce the dark veil of ignorance of the masses letting in a little bit of light. Through the patch work of that dark curtain we can see the power elite storing away riches as they trade silver and gold amongst themselves. Along the line of the curtain we see hands extending through passing along worthless pieces of paper they call “money” and tell us that it is valuable.

This meme is dying but they would have us believe otherwise.

Within the past week the margin requirements for commodities and specifically silver have been raised no less than 5 times with another pending. The goal is to drive speculators out of the silver market to “control volatility”. If this is the reasoning why are they not raising the margin requirements on oil? How many people do you know that own silver? Why the impetus on that obscure metal? How many people do you know that drive a car and buy gas? How important is the price of oil to our economy? Obviously for reasons untold silver and gold are very important to the powers that be. They are the canary in the coal mine. As governments print more and more money the price of silver and gold rise. The more silver and gold the peasantry own the less likely they are to be shackled into debt servitude forever more. The more we own the less they can have. This cannot be. They must constantly wage war against our minds to “shake” us from our positions.

This morning we read the following from Zerohedge: WSJ Reports Soros, Burbank Selling Gold, Silver, While Paulson Sees Gold Hitting $4,000 In Three Years

An excerpt from the article: "The rumormill around who is buying and selling precious metals is getting more ridiculous than daily Radioshack LBO speculation. The latest comes from the WSJ which informs that based on "people close to the matter" Soros and Burbank are now dumping their gold and silver: "George Soros's big hedge fund, a firm operated by high-profile investor John Burbank and some other leading firms have been selling gold and silver, according to people close to the matter, after furiously accumulating precious metals for much of the past two years." Greg Zuckerman's conclusion, assuming a multi billion hedge fund will actually let its competitors know what it is doing concurrently as it is doing it, is merited: "Their selling suggested the sharp, nine-month run-up for precious metals could be entering more dangerous territory." Of course, something tells us that just like Goldman, whose prop desk has a nagging tendency to buy as its sellside "analysts" say sell, we would rather hold off until we see respective 13Fs on the matter. In the meantime, we fail to see where over the past week the central (pardon the pun) thesis has changed: namely that central banks will not print more linen/cotton when the time comes. And if the market is indeed starting to price in QEasing's end, then the deflationary scare will certainly see the RUT plunge and undo months of carefully executed (by NYU interns) POMO operations. For a Fed which equates the economy with the RUT, this is simply unacceptable."

You should be aware that last month George Soros funded and coordinated a meeting at Bretton Woods to discuss the future of our monetary system worldwide. The discussion would revolve around the use of an SDR (special drawing right) in which it would be partially backed with gold, amongst other currencies and perhaps commodities. The announcement of the selling of gold by the Soros fund would suggest that gold being part of the SDR system was a no go. We have no information on how that meeting went to my knowledge however are we to believe that gold is now no longer desired as a safe haven against the foibles of government and their money printing ways? I’m not willing to make that wager. Actually I am and I wager they will keep printing money and they will continue to go in debt and they will continue to devalue currencies to pay for that debt and the price of silver and gold will continue to rise. My wager is placed and I am “all in”. In the metals that is.

You should also be aware that at the last Davos meeting in January, George Soros announced that “gold is the ultimate bubble”. Now you can interpret that in a number of ways. I believe he meant that the gold is ultimately where all currencies will collapse, creating the ultimate bubble. If all the currencies of the world collapsed today into gold and silver the “prices” would stagger you. Of course “price” would become a redefined term. We would be speaking in terms of value. You would perhaps use one ounce of gold as collateral against a loan to purchase a house. Yes, one ounce of gold. Delving too deeply into that would be outside of the scope of this investigation. See the Fofoa blog for more on that. Dig deep there and do go, you will learn much.

Of course the media, shortly after hearing Soros announcement that gold is the ultimate bubble started touting the headlines that silver and gold are in a bubble and they were claiming the trade to be crowded suggesting that they should be sold. If you would have done so it would have cost you dearly. Shortly thereafter we learned that Soros had been buying gold to the tune of $650 million. And now after multiple margin hikes where the momentum of the metals have turned downward and sentiment has turned negative, Soros claims to be selling a small portion of his holdings? My belief is that he is trying to push the price lower for the ultimate set up. We may see in his next 13-F that they had indeed sold a small portion of their holdings but he will likely go on a spending spree the day after the report is filed with the SEC.

Who else is selling gold today? Not the Mexican government’s Central Bank! They just announced that they are buying 100 tonnes of gold. Again, from Zerohedge: Portuguese Gold Sale Urged By Senior German Lawmakers As Mexican Central Bank Buys 100 Tonnes. Add them to a long list of other Central Banks who are buyers.

Indeed, not only are they buying gold but Central Banks of the world have become net buyers of gold instead of sellers for the first time in over a decade. These are the insiders of the inner circle who dictate to the world what money is and is not. Will you be led to believe that gold and silver are not money? There are also rumors that the Indian Central Bank has been buying silver. China clearly stated that thy will also be diversifying their currency reserves into silver and in the Middle East it is no secret that they have been minting silver and gold coins.

Now is the time to be vigilant more than ever. When you view the actions of those claiming lordship over us those actions do not mix well with their words. Silver and gold may run down in price further yet but this is a gift to you. You can despair and think we are defeated or you can see through the veil and see that the powers that be are afraid and shaking. They are preparing for major currency dislocations and the best way to protect yourselves from such events is by donning your silver and gold armor. Use this as a buying opportunity to strengthen your family’s positions in these chaotic times. Cast aside your doubts and fears, do what others will not and you will be rewarded.

“The gods favor the bold.”
Publius Ovidius Naso Ovid

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