Tag Archives: U.S. dollar

The Existing World Order Is Collapsing

It’s the collapse of that structure that was built in the 1940s that is behind all of these problems that are popping up in financial markets and economies around the world. Richard Maybury, publisher of U.S. & World Early Warning Report for Investors.

In a conversation with Henry Bonner of Sprott’s Thought’s,  Richard Maybury lays out the framework of the existing World Order that was set up after WW2, which left the west – and primarily the U.S. – at the center of the world power structure.   That power structure is collapsing.   Maybury discusses the how the acceleration of the many chaotic events which have developed in connection with this ongoing and accelerating collapse:

Who knows what’s coming. I don’t. I just know that if you have a whole lot of cash of any kind, in any currency, you ought to be really nervous about it and you ought to be into raw materials and precious metals, at least to some extent  (Sprott’s Thoughts)

What’s interesting about this is that most “alternative thought process” analysts – and the armies of people who follow them – believe that the Rockefeller/Rothschild Bilderberg Group will emerge as the dominant NWO entity.   I have been skeptical of this view for well over a decade.

The truth is, once the existing power infrastructure collapses, all bets are off.  History tells us that anything can happen and that something entirely unexpected by almost everyone is what will emerge.

Unfortunately, my view has been and remains that global nuclear chaos will occur.  If you want to see how that ends up, please read “The Road” by Cormac McCarthy.   I hope I’m wrong but I doubt that I am…

The U.S. Dollar Had To Use The Rest Room Today…

While gold, silver and mining shares catapulted from overnight and early attempts to manipulate them lower…(click on graphs to enlarge):

SeptDX

USDX

The U.S. dollar has lost the psychologically important 80-handle, it lost its 200 day moving average on Friday and its 50 dma today.  All of these are important technical levels.  The most interesting aspect of the graph on the bottom is the accumulation/distribution line.  This shows net dollars flowing either into or out of U.S. dollar futures.  As you can see, the dollar has experienced significant outflows since last July.  The outflows slowed down for a bit in early May but it appears as if the selling is gathering momentum again.

Can’t say I would be an anxious holder of U.S. dollar given our Government’s incompetent handling of its imperialistic affairs, the extreme fraud and corruption that has infested every corner of DC – including the Oval Office  – AND,of course, the declining wealth output as measured by the latest GDP reading.

 

Fake Payroll Report Friday – Ecador’s Gold – The Dollar Is Not In An Uptrend

First, today was the monthly Government non-farm payroll report folly. The best part about is that is gives us the entertainment content of watching CNBC’s Steve Lieman and Mark Zandi make absolute idiots of themselves.

The big media spin is that, supposedly, the economy has finally “recovered” the number of jobs that had been lost 2007. Even if that were true, big deal. If you look at the labor force participation rate, it’s at a 62.8% – a level last observed in early 1978 (Link), which is when most households were still one-worker families. Since 2007, 12.8 million people have disappeared from the labor force (retired, disability insurance, student loans, stopped looking/welfare).  If you factor in population growth, getting back the jobs lost since 2007 is pathetic.  And most of those jobs are lower-paying, temporary, or statistically created by the Government’s “birth/death model.”

As for Goldman Sachs’ hypothecation of Ecuador’s 13 tonnes of gold. Ecuador has 26 tonnes in total. You don’t manipulate the market with 26 tonnes.  China withdraws over 30 tonnes per week from the Shanghai Gold Exchange. Then there’s India. Then there’s Russia. Then there’s Viet Nam (Viet Nam is the 5th largest gold importer in the world – that’s a fact).  Then there’s all the other gold-buying countries.  At least 50 tonnes of gold gets bought every week. This is gold that has to be delivered.

Coincidentally, or not coincidentally, Russia bought 25.5 tonnes in April. My bet is that Goldman may have needed that gold from Ecuador to deliver to Russia.  If not Russia, then to any of the other buyers I mentioned above.  It’s not the Govt of Viet Nam that buys gold. It’s the people. They want the real stuff, not a paper certificate.

Finally, we know the Bank England was missing 1300 tonnes of gold after the April 2013 $200 price takedown.  It takes 1300 tonnes to manipulate the market, not 13 tonnes. Goldman has hypothecated 13 tonnes of gold from Ecuador that Ecuador likely will never see again.

How come no one is asking about the 1500 tonnes of German Govt gold that is missing from the Fed? How come no one is asking about the 1,000+ tonnes of gold that the Italian Govt keeps at the Fed?  Ecuador’s 13 tonnes gets bought and delivered in less than 1/2 a week.

Finally, Zerohedge posted a piece by Charles Hugh-Smith in which he avers that the U.S. dollar is in an uptrend.  He’s wrong.  And it shows the problem with taking geometric shapes from 5th grade geometry and imposing them on the price-charts of things traded in  the financial markets.  Here, have a look:

(click in graph to enlarge)

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I’m not saying that the U.S. dollar won’t go into an uptrend, but I am saying that it is definitively NOT in an uptrend.  It needs to get over 81.53 before we can start debating “uptrend/no uptrend.”

I would bet against that happening – short of Fed manipulation.  As you can see, the accumulation/distribution line is indicating that the dollar is now being sold in greater quantities than it’s being bought plus the RSI and MACD momentum indicators are rolling over.  You can see the accum/distro line is actually rolling over on a 1-yr chart.

I stopped reading CH-S quite some time ago and that’s an example of why.

Is Desperation Setting In?

Central banks in the West are emptying their vaults in an attempt to maintain the illusion that the national currencies they manage are immune to monetary debasement.  The central banks are trying to perpetuate a system in which governments believe they can borrow and print money endlessly to fulfill the impossible promises of politicians.  – James Turk on King World News (link)

After the metals staged their usual overnight rally while the physical gold hoarding Asian markets were open, this morning featured two HFT-algorithm flash crashes.   One at 7:00 am. EST and one right at the Comex open (the latter occurs at least 85% of the time).

This graph illustrates the action – note the long “wicks” at the bottom of the red candlesticks, which is our indication that the flash-crash operation triggered computer-driven “stop-loss limit” selling from the hedge funds:

(click on graph to enlarge)

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Neither attack on the metals was accompanied by any possible news triggers.  The dollar didn’t move, which is something we would have expected if there had been some kind of fundamentals-based trigger.  The SPX futures ramped up at the same time the metals were hit in the first flash crash.   It is clearly unmistakable Fed intervention designed to keep a lid on the recent rally in the metals.   But why?

The intervention in the gold/silver market reflects desperation from the western Governments/banks, especially the U.S., in order to prop up the U.S. dollar.   Russia and China are getting ready to sign a series of gas/oil deals which will be transacted using rubles/yuan.  Russia’s main bank just signed up for China’s equivalent of Visa/Mastercard after the U.S. sanctions restricted the use of Visa/MC in Russia.   The dollar has dropped back below the critical 80 level (US dollar index) just as quickly as it popped back over 80 after Janet Yellen delivered her highly “engineered” post-FOMC meeting press remarks.

It is becoming increasingly clear – at least to me – that the U.S. economy is now a walking corpse.   The housing market is about to go into free-fall like it did starting 2006.  How do I know this?  Because of the exhaustive analysis I’ve been doing on the housing market data and because the homebuilder stocks are now diverging significantly to the downside from the rest of the stock market.   The homebuilder stocks behaved this way starting in mid-2005, about 6 months before housing market reflected the deteriorating fundamentals of the housing market back then.   The homebuilder stocks similarly peaked in May 2013.

There is a big “accident” in motion for which impact could occur at any time.   The stock market action from Friday thru Tuesday is an obvious signal.  The quick reversal from its recent dead-cat bounce is another.  The dollar is in big trouble and the Fed is trying desperately to fight that by suppressing the metals. When that fails, I bet we’ll see an escalation in military operations.