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From David’s Desk

Be sure and read Charlie Reese’s Final Column at the end of the newsletter.

A good picture is worth a lot of words.  Here are two charts, courtesy of John Williams (Shadowstats) that present the gulf between reality and the information presented to the public by the government’s BLS.

Note that inflation is actually running just a tad below 10%, not the 2% trumpeted by the BLS.

Note that unemployment is really 22%, not the 9% offered up by the BLS.

Perhaps the BLS should shorten its name to just BS.

The following commentary, borrowed from Jim Sinclair’s outstanding website, should help set you straight on where gold is going, why it’s going there and why you need not concern yourself with any short-term pullback.  Do not lose any sleep over gold’s action.  The bull market is alive and well.  The only mistake you can make is to NOT be in the market.  If the price pulls back, buy more and laugh all the way to the bank, knowing that JPMorgan has just subsidized your purchase.

Gold Is Getting Wild, Get Used To It
CIGA Eric, posting on JSMineset

Experts rush to urge caution after an intraday plunge (hit) in gold and silver. They use words like outside reversal day and an unstable parabolic trend. An outside reversal day will be little more than “noise” within a secular trend in a few months, but fear is driven by the moment. As for a parabolic trend, yes, it’s critical to correctly identify them. Is the current parabolic trend extended far beyond previous advances? Discipline says no.

Gold, London P.M. Fixed (Gold) and Z Scores from Primary Trend

As Jim writes, you must realize that the point of correctness in the article How & When that is true is his $5000 to $12,500 and not prognostications of the next 90 days. Discipline sees not only the trees but also the forest.

Armstrong also suggests that the correction into June does not necessary have to be down. Corrections can be down, sideways, or periodically in a strong market a running (upwardly sloping) correction can form. The message from the market is most important here.

Commentary: Martin Armstrong just wrote a paper on gold titled, “How and When”

My question to this article is WHY?

Why in the world, if you believe that the gold price can go to $5000 and $12,500, as the article says, do you give a flipping damn about the next 90 days.

You must realize that the economic and political damage is already done.

You must realize that the mountain of OTC derivative paper is not going away.

You must realize that all the old Legacy asset; (broken OTC derivatives) demand to be adjusted at each market turn in order to maintain any sememblence that they are serious contracts.

You must realize that this adjustment means adding on new OTC derivatives.

You must realize that this means the mountain of OTC derivative weapons of mass financial destruction can only grow.

You must realize that it is not if, or not, QE will continue, it is what it already has done to the Western Economies that much higher gold prices will reflect.

You must realize this is not a business problem, but rather a debt problem as it applies to the gold price.

You must realize the monumental change in the Middle East is NOT positive for the West in any manner, shape or form.

You must realize that the change in the Middle East is from some form of government to Chaos.

You must realize that the beneficiaries of Chaos in the Middle East are Iran and Russia.

You must realize that the main product of the establishment of a no fly zone in Libya is to benefit the Rebels.

You must realize that the rebels are an unknown factor in Libya.

You must realize that a second product of the no fly zone is greater hatred in the Middle East for all things West.

You must realize that the Peak Production of Energy is behind us.

You must realize that the production of energy in chaos will be less than under some form of rule.

You must realize that this combination of monumental Middle East change and the Peak Oil means Peak oil is no longer a consideration for 10 to 15 years from now, rather it is now.

You must realize that the Angels, gold prices, are not simple talk but rather a method used by the great market maven Jesse Livermore.

You must realize that on the next trip to $1444, that price will FALL to the long term bull market on gold.

You must realize that $1650, a place where gold will trade is so low as to be comical looking back from 2015.

You must realize that “QE to Infinity” is not a choice but all there is the left in the tool box of US Fed.

You must realize the truth of today’s comment by Dallas Federal Reserve Bank President is true.

You must realize that what the President of the Federal Reserve Bank fear will occur.

You must realize no sovereign country needs to go broke.

You must realize they simply refer to QE as policy.

You must realize that it is the currency that breaks, not the country.

You must realize that the point of correctness in the article How & When that is true is his $5000 to $12,500 and not prognostications of the next 90 days.

Sincerely,

David Schectman

Miles Franklin