I think somehow the wizards curtain has finally fallen away. All will see the Fiat Fed for what they are and the herd will try to exit the burning theater and all get thru that itty bitty precious metals door, should be interesting the first day physical delivery metals go "no bid" on a global basis. Some musical chair games have big Cha Ching's at the end!
I've been watching the spread between the 3-month T-bill and the 10-year note for the last year or so. Prior to the Fed's recent rate raise it was like watching paint dry, particularly with regard to the 3-month, as it hardly budged, and the 10-year being more range bound but usually kept under 4%. Since their raise of a half percent the yield on the 3-month bill has fallen precipitously, from a bit over 5.3% to now around 4.64%, and the 10-year's yield has crept up to 4.01%.
David, you wrote "If this short-term trend continues and migrates into shorter term Treasury bonds, even as the market is told to anticipate lower interest rates, it will be a signal that the Fed is losing the ability to steer the bond market with its pronouncements." I wouldn't disagree, other than saying I may be more worried about an even worse situation suddenly arising if the part of the yield curve I pointed out un-inverts. Do you think it will and should I be more worried if it does?
I think shorter duration Treasuries are going to drop but that currency printing by the Fed is going to accelerate and price inflation will surge. At that point the market will dump all Treasuries spiking yields. Fed will probably step-in with QE but then oil, silver, gold, grains etc. will go into orbit.
It'll get seriously scary at that point when ALL Treasuries are dumped by the market, maybe more so., oddly enough, for many possessing physical gold and silver (insurance) because some of us will understand the severity and nature of what'll be occurring with the onset of that financial hurricane. It'll be CAT 5 devastation to the current financial system by the time it's over - no choice this time but to rebuild everything from the ground up with things which are real.
I am trying my best to liquidate my SIPP tax free allowances as just turned 55, and put it into gold Britannias with storage in reputable dealers, and also trying to liquidate my substantial ETF gold ISA holdings into the same physical vaulted storage.
My only worry is that in a mega crash/crisis the government/WEF etc will try to to seize my stored gold coins.
I view vaulted storage as the least risky option for the bulk of my holding, with a few Britannias stored in my home that even Colombo wouldn't find if he had 24 hours to search my properly and gardens.
Vaulted storage overseas makes it a bit harder for those who wield the power of the State in which one resides to steal it from you. I have no personal experience to back that assertion, but have noted that in the UK foreigners are treated better than genuine British people. But there are pros and cons to any such arrangement. Having a portion of ones metals in the Kinesis Monetary System has benefits. One of those is that they pay a yield (in metal) on your precious metals. That can offset fees paid to traditional vaulting companies. As with eggs and baskets, not keeping all your vaulted metal in one place has merit. Kinesis has Andrew Maguire as a director. We all have to trust some people some of the time and I opened an account with them because he is one of the sound money people that I think is sound. We all make our own choices and those will colour how we see the world and other people. As for seizure, I think Capital Gains Tax or some newly invented tax, all backed up by a moralising and legitimising narrative fed through media outlets and amplified by them is more likely. If they can convince those who were not so sensible as you that you are an agent of Putin, 'far right' or capitalising on the financial distress of the majority, then many amongst that majority would agree that good sense is a sign of extremism and should be stamped out.
I like Kinesis but am concerned as a US citizen with the US ownership evidently being deemed as vaulted in the US by Kinesis. They should allow us to ask them to store it in the vault country of our choice.
I'm thinking of redeeming some of my KAU to a reputable bullion dealer's vault in Singapore.
The way I see it, setting aside the US has a history of gold confiscation, the fact of the matter is that confiscation happens by any government in almost every financial crash. Look at Weimar, Austria and Hungary during 1922-23 and of course Hitler and all the rest of it. Once the government is broke they want ANY real money even if it's not theirs, because their fiat credit came to tears. Plus if you've got ounces and ounces, you obviously must be a drug dealer.
And of course large amounts of silver aren't any safer from drunk Uncle. It can be deemed a strategic metal especially for military and transportation manufacturing needs. It's just a lot harder to store, move around and liquidate when the time comes especially if you have it in your hand. You get to a certain amount in your physical possession before it makes no sense at all holding more, and you have to look at vaulting options like kinesis, which is a great deal for buying and vaulting both Au and Ag.
With the way BRICS seems to be developing, Singapore becomes more attractive. All counterparties involve risk, some more than others. Personally, I am still learning what is to me is a new way of thinking. When I talk to others about the peril fiat currencies entail, and the loss of wealth involved, they don't want to know. In my experience - and this is based on a minute sample - younger adults are the most resistant. I suppose they have been trained to view counter signals as conspiracy theory and have never experienced a financial or currency crisis. At an early stage, they stop responding. Questioning the system at all seems to make them uncomfortable. Kinesis, if nothing else, offers a good entry point to those who wouldn't consider burying coins in their garden.
You get to a certain amount in your physical possession before it makes no sense at all holding more, and you have to look at vaulting options like kinesis, which is a great deal for buying and vaulting both Au and Ag.
Depends where it's vaulted, if it's physically titled as your metal 1to1, audited regularly and you trust the company. Kinesis is to me such an option.
I appreciate your view, and certainly agree with you a large percentage of typical off the shelf PM securities and other less savory options exist, and yes rehypothication is rampant, largely in wall street and the US Federal Ft Knox. In the end I believe that holding an adequate supply of smaller, portable PMs in hand is best.
But as I say, it gets to a point (a good problem to have) where it is dangerous and difficult to personally, safely store large amounts. Then again some might assume their house will never catch fire, that law and order will always be such they will never be forced to flee with a small satchel.
In the end it's all relative to our risk tolerance and personal situation. But I will not trust my own government to keep their hands of my stuff, or banksters to sell me any true value and deliver it when needed most. And that goes triple for credit instruments like Fiat money.
Thanks for your input, I appreciate the opportunity to further share my view.
Hi David, does an expansion of the theater of war assist the US bond market? Can bonds and gold appreciate together in such an environment? What about silver? Does it follow stock market trends or safe haven trends under such circumstances? Thank you.
Only people buying the metals space are speculators and "smart money" and this world isn't too smart these days.
Absolutely no one beyond the gold bug community talks about gold. All my metals DD on the bigger reddit channels have combined 200k views with >200 link shares. Of those link shares I'm guessing 10% are consider taking action.
Peter schiff told a story about a decade ago. He was at the Nevada realtors conference and laid out his big short thesis. The audience was 3,000. Of those 300 came to his room to hear about investing in the credit default swaps he set up with an external hedge fund. Of those 300 only 1 signed up and that guy eventually made 10x his money.
Same thing happening today just in the metals space.
I think somehow the wizards curtain has finally fallen away. All will see the Fiat Fed for what they are and the herd will try to exit the burning theater and all get thru that itty bitty precious metals door, should be interesting the first day physical delivery metals go "no bid" on a global basis. Some musical chair games have big Cha Ching's at the end!
Boom.
I've been watching the spread between the 3-month T-bill and the 10-year note for the last year or so. Prior to the Fed's recent rate raise it was like watching paint dry, particularly with regard to the 3-month, as it hardly budged, and the 10-year being more range bound but usually kept under 4%. Since their raise of a half percent the yield on the 3-month bill has fallen precipitously, from a bit over 5.3% to now around 4.64%, and the 10-year's yield has crept up to 4.01%.
David, you wrote "If this short-term trend continues and migrates into shorter term Treasury bonds, even as the market is told to anticipate lower interest rates, it will be a signal that the Fed is losing the ability to steer the bond market with its pronouncements." I wouldn't disagree, other than saying I may be more worried about an even worse situation suddenly arising if the part of the yield curve I pointed out un-inverts. Do you think it will and should I be more worried if it does?
Either way, I think the paint is done drying.
I think shorter duration Treasuries are going to drop but that currency printing by the Fed is going to accelerate and price inflation will surge. At that point the market will dump all Treasuries spiking yields. Fed will probably step-in with QE but then oil, silver, gold, grains etc. will go into orbit.
It'll get seriously scary at that point when ALL Treasuries are dumped by the market, maybe more so., oddly enough, for many possessing physical gold and silver (insurance) because some of us will understand the severity and nature of what'll be occurring with the onset of that financial hurricane. It'll be CAT 5 devastation to the current financial system by the time it's over - no choice this time but to rebuild everything from the ground up with things which are real.
It may be a CAT 5, but they will try to rebuild with a US Fiat CBDC, declaring that the answer. You can't make this stuff up.
A lot of people are making this observation.
Franklin D. Roosevelt: 'In politics, nothing happens by accident. If it happens, you can bet it was planned that way.'
Franklin agrees with you.
One other thought, a humorous one, hopefully: The Fed stepping in with QE will be like handing out pretzels to people dying of thirst in the desert.
Indeed.
Putting out the fire with gasoline.
I am trying my best to liquidate my SIPP tax free allowances as just turned 55, and put it into gold Britannias with storage in reputable dealers, and also trying to liquidate my substantial ETF gold ISA holdings into the same physical vaulted storage.
My only worry is that in a mega crash/crisis the government/WEF etc will try to to seize my stored gold coins.
I view vaulted storage as the least risky option for the bulk of my holding, with a few Britannias stored in my home that even Colombo wouldn't find if he had 24 hours to search my properly and gardens.
Vaulted storage overseas makes it a bit harder for those who wield the power of the State in which one resides to steal it from you. I have no personal experience to back that assertion, but have noted that in the UK foreigners are treated better than genuine British people. But there are pros and cons to any such arrangement. Having a portion of ones metals in the Kinesis Monetary System has benefits. One of those is that they pay a yield (in metal) on your precious metals. That can offset fees paid to traditional vaulting companies. As with eggs and baskets, not keeping all your vaulted metal in one place has merit. Kinesis has Andrew Maguire as a director. We all have to trust some people some of the time and I opened an account with them because he is one of the sound money people that I think is sound. We all make our own choices and those will colour how we see the world and other people. As for seizure, I think Capital Gains Tax or some newly invented tax, all backed up by a moralising and legitimising narrative fed through media outlets and amplified by them is more likely. If they can convince those who were not so sensible as you that you are an agent of Putin, 'far right' or capitalising on the financial distress of the majority, then many amongst that majority would agree that good sense is a sign of extremism and should be stamped out.
I like Kinesis but am concerned as a US citizen with the US ownership evidently being deemed as vaulted in the US by Kinesis. They should allow us to ask them to store it in the vault country of our choice.
I'm thinking of redeeming some of my KAU to a reputable bullion dealer's vault in Singapore.
The way I see it, setting aside the US has a history of gold confiscation, the fact of the matter is that confiscation happens by any government in almost every financial crash. Look at Weimar, Austria and Hungary during 1922-23 and of course Hitler and all the rest of it. Once the government is broke they want ANY real money even if it's not theirs, because their fiat credit came to tears. Plus if you've got ounces and ounces, you obviously must be a drug dealer.
And of course large amounts of silver aren't any safer from drunk Uncle. It can be deemed a strategic metal especially for military and transportation manufacturing needs. It's just a lot harder to store, move around and liquidate when the time comes especially if you have it in your hand. You get to a certain amount in your physical possession before it makes no sense at all holding more, and you have to look at vaulting options like kinesis, which is a great deal for buying and vaulting both Au and Ag.
With the way BRICS seems to be developing, Singapore becomes more attractive. All counterparties involve risk, some more than others. Personally, I am still learning what is to me is a new way of thinking. When I talk to others about the peril fiat currencies entail, and the loss of wealth involved, they don't want to know. In my experience - and this is based on a minute sample - younger adults are the most resistant. I suppose they have been trained to view counter signals as conspiracy theory and have never experienced a financial or currency crisis. At an early stage, they stop responding. Questioning the system at all seems to make them uncomfortable. Kinesis, if nothing else, offers a good entry point to those who wouldn't consider burying coins in their garden.
If you don't HOLD it, you don't OWN it.
Trust NO ONE.
You get to a certain amount in your physical possession before it makes no sense at all holding more, and you have to look at vaulting options like kinesis, which is a great deal for buying and vaulting both Au and Ag.
You think they don't rehypothecate (loan out) the PM's they "claim" to have in their vaults?
Come on, now.
Depends where it's vaulted, if it's physically titled as your metal 1to1, audited regularly and you trust the company. Kinesis is to me such an option.
I appreciate your view, and certainly agree with you a large percentage of typical off the shelf PM securities and other less savory options exist, and yes rehypothication is rampant, largely in wall street and the US Federal Ft Knox. In the end I believe that holding an adequate supply of smaller, portable PMs in hand is best.
But as I say, it gets to a point (a good problem to have) where it is dangerous and difficult to personally, safely store large amounts. Then again some might assume their house will never catch fire, that law and order will always be such they will never be forced to flee with a small satchel.
In the end it's all relative to our risk tolerance and personal situation. But I will not trust my own government to keep their hands of my stuff, or banksters to sell me any true value and deliver it when needed most. And that goes triple for credit instruments like Fiat money.
Thanks for your input, I appreciate the opportunity to further share my view.
"But I will not trust my own government to keep their hands of my stuff, "
What happens when the government goes for Kenesis.
Yep, your right! Gotta move it around and stay one step ahead of Broke Uncle!
Hi David, does an expansion of the theater of war assist the US bond market? Can bonds and gold appreciate together in such an environment? What about silver? Does it follow stock market trends or safe haven trends under such circumstances? Thank you.
The fact miners have moved so little is a sign this is not a speculative bubble in gold and silver.
No euphoria.
Only people buying the metals space are speculators and "smart money" and this world isn't too smart these days.
Absolutely no one beyond the gold bug community talks about gold. All my metals DD on the bigger reddit channels have combined 200k views with >200 link shares. Of those link shares I'm guessing 10% are consider taking action.
Peter schiff told a story about a decade ago. He was at the Nevada realtors conference and laid out his big short thesis. The audience was 3,000. Of those 300 came to his room to hear about investing in the credit default swaps he set up with an external hedge fund. Of those 300 only 1 signed up and that guy eventually made 10x his money.
Same thing happening today just in the metals space.
Smart money vs speculators - opposites.
Thanks for your comments.
Thanks for uploading your analysis
NP
Too many people look at PM's as "investments."
They are INSURANCE.
Yes. Lifeboats.
And once, and future, money.
Edit: he was in Nevada in 2007...