A Collapsing Dollar Will Trigger The Next Big Move In Gold And Silver

When you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you–when you see corruption being rewarded and honesty becoming a self-sacrifice–you may know that your society is doomed. – from “Atlas Shrugged”

Sorry MAGA-enthusiastics, it’s all a lie.  The tax legislation just passed will lead to higher Government spending deficits, a near-parabolic acceleration in Government debt issuance and a possible collapse of the dollar.  The U.S. is in systemic collapse.  Perhaps the biggest manifestation of this is the grand money-grab by the elitists enabled by blatant political corruption.

Alasdair Macleod published an essay that I highly recommend reading as you gather together your thoughts heading into 2018. 2018 will possibly see the next stage in the collapse of the dollar. I disagree with Alasdair’s attributing the control over the formation and implementation of economic and geopolitical policy to Trump. Notwithstanding this disagreement,  I believe Aladair’s analysis of monetary events unfolding during 2018 deserves careful perusal.  This includes his delineation of the rise in the petro-yuan as a precursor to the demise of the dollar, an acceleration of dollar-derived price inflation and an escalation in the price of gold.

The general public in the West is hardly conscious of these developments, only being vaguely aware that more and more products seem to be imported from China. They are certainly not aware that America has already lost its position as the world’s policeman, the guarantor of economic freedom and democracy, or whatever other clichés are peddled by the media. And only this week, President Trump in releasing his National Security Document, and pledging “America would reassert its great advantages on the world stage”, showed the American establishment is similar to a latter-day Don Quixote, unaware of the extent of change in the world and the loss of its power.

Like a monetary embodiment of Cervantes’ tilter at windmills, the world’s reserve currency is rapidly becoming an anachronism. And for China to realise her true destiny, it must dispense with dollars, and if in the process it crushes them, then so be it.

You can read the rest of Macleod’s brilliant essay here:   2018 Could Be The Year For Gold

Contrary to the views expressed by recent crypto-currency proselytizers, I believe that if gold heads higher in the next year then silver will soar.

18 thoughts on “A Collapsing Dollar Will Trigger The Next Big Move In Gold And Silver

  1. There’s been a phenomenal increase in the amount of dollars, pounds, euros, yen and yuan. There has been no corresponding increase in the value of precious metals. There has been heavy price suppression by naked shorting of massive amounts of nonexistent gold and silver. The cat is out of the bag, the physical markets are poised to overtake these phony paper markets and then it’s off to the races for the precious metals. Got gold? Got silver? It’s still on sale but the sale is almost over.

  2. Nonsense. Macleod is still claiming that China is going to allow the new crude futures contract to be convertible to gold which is simply not true. Read the terms and conditions to trade this on the exchanges website in China and there is no provisions for this and Chinese officials have also denied the whole thing. What these people do not realize is that China allows no gold to leave its border as they have capital controls which includes gold. What good is gold in China if you are a foreign and cannot remove it?
    The new crude futures contract will have no effect on the dollar and again these people fail to understand markets. The Chinese oil firms are going to have banks there place hedges using put options in case prices fall to protect profits. This is not a physical crude market but a futures market and like all futures are basically used to hedge. There are no oil producing countries lining up to trade as they use other futures markets to hedge especially in the Middle East.
    The dollar nonsense. The largest consulting firm on the planet, Armstrong Economics, has computer models which track both domestic and international capital flows. They forecast back in 2009 that the Dow would hit 22,000 then 23,000 and onto around 40,000 all due to the capital flight out of Europe as it has been collapsing and will not only continue but accelerate. They also forecast dollar strength and this is exactly what we have been seeing. The models are also forecasting that in 2018 both the Monetary and the Sovereign Debt Crisis hits there along with the pension crisis. Recently Italy announced they are working on a plan to abandon the euro, another bank there is in trouble, many cities and provinces in Germany are broke due to the migrants, last week mayors all over France ask the government for help as they to are broke from the migrants and the pension crisis has hit Spain and will be totally wiped out in 2018. Banks will fail, access to deposits will be denied, pensions will stop along with social benefits, businesses will fail and countries will default on their sovereign debt. Capital has been leaving and will again accelerate into dollars and cause dollar strength again, move US equities higher and crush gold and silver.
    Martin Armstrong and his staff recently were in Europe for a week meeting existing and new clients. China is so concerned about the collapse in Europe and flew PBOC officials to London and met with the firm. Martin then flew to Brussels and met with EU officials and they are in panic mode as Europe is running out of funds. They also met with many of the central banks and even government officials as they know when the funds run out they are all in deep shit.
    Now if you control large amounts of capital are you really going to park it anywhere in Europe? Of course not. You are going to move it to dollars and US equities and that has been happening and will continue. This is the end of socialism in Europe.
    Many Americans do not watch global macroeconomic events outside the US and these events cause the large movement of capital flows and cause markets to move as they do. This has caused enormous problems for the FED as they need and want a much weaker dollar but with all this capital still flowing in they cannot achieve it. Will this collapse eventually hit the US? Of course but on the horizon. Europe must crash and burn first and this process has been ongoing since 2011.

    1. Interesting interpretation of reality. I don’t believe Alasdair specifically pointed to the petro-yuan contract that will soon debut and made the assertion
      that it was convertible to gold.

      Certainly anyone transacting in the contract would have the ability to take proceeds from settlement and buy gold on the SGE. The idea is that China will at some point introduce petro-yuan contract that is convertible directly into gold.

      As for the notion of no gold leaving China, I guess you would assert that the 1 oz gold Pandas I’ve been accumulating are fake?

      Martin Armstrong is a criminal, a shill and at least mildly insane.

      1. Jim you said that Martin Armstrong’s analysis claimed that
        gold would get crushed. That must be a old analysis. According
        to an interview with Greg Hunter @ USA Watchdog, Armstrong
        advocated owning gold due to the coming hyperinflation his
        computer models are signaling. The link to the interview is attached.
        Oh and Jim, folks that read this site are fairly well informed so make
        sure you troll with caution. It just makes you look bad.


      2. Above he writes “….The largest consulting firm on the planet, Armstrong Economics,….”

        That sounds like nonsense to me. A namesake consulting firm is the largest on the planet?? Bigger than all other consulting firms founded by really big money and really big resources?

    2. These Yuan denominated oil futures contracts will be convertible and deliverable to gold via exchanges in Dubai and Hong Kong gold futures contract denominated in yuan, not the SGE.
      Unlike the COMEX and the CBOT which pulled a fast one on the Hunt brothers by changing the rules, limited investors’ holding of silver contracts and raised the margin requirement, Dubai and Hong Kong will honor (back) the futures contract denominated in yuan with physical delivery. The beauty of this scheme is that Dubai and Hong Kong will have to replenish via the Comex or LBMA – dollar denominated gold or gold futures.
      When gold price reaches over $7,000 to $8,000/oz, China will then loosen its tight restriction on the flow, allowing gold to be exported out of China via SGE – backing the yuan denominated oil futures with yuan denominated gold or gold futures.
      In short, China is backing the yuan denominated oil futures with dollar denominated gold via Dubai and Hong Kong until Comex and LBMA are broken.

    3. Jim,
      Wow! With DXY falling to near 92 and gold over $1300/oz. this a.m., you can tell us with a straight face that the opposite must happen. DJIA 40K? Are you insane? We’re clearly in a topping pattern. It’s a long way down from here. Invest accordingly. More fake news…

      IGNORANCE IS STRENGTH.” – George Orwell, 1984 – Ingsoc party slogan, Part 1, Chapter 1.

      The recent tax cuts (read crony capitalist handouts) are at the completely wrong part of the econ. cycle, and are not revenue neutral (read increase the deficit). This was pure politics and completely divorced from sound fiscal policy. Why do you think the $ is falling and gold is rising? This isn’t rocket science…

      “A point of view can be a dangerous luxury when substituted for insight and understanding.” – Marshall McLuhan, Canadian Communications Professor

      “Without data, you’re just another person with an opinion.” – W. Edwards Deming

      “I never guess. It is a capital mistake to theorize before one has data. Insensibly one begins to twist facts to suit theories, instead of theories to suit facts.” – Sir Arthur Conan Doyle

      “Facts do not cease to exist because they are ignored.” – Aldous Huxley

  3. I suspect oil settled in Yuan can be converted into Gold at the Hong Kong Exchange and clearing house. HKEx is supposed to be preparing a physical gold contract denominated in Yuan. That would make it very possible for oil nations to convert their Yuan into Gold without tapping Chinese national reserves. Just another piece of the puzzle.

  4. Cliff “I love always being” High told Greg Hunter that gold will be $3,000-$5,000/oz in February 2018, just that quick. And Cliff has red-frame glasses and red lipstick for you too. Cliff says break on through to the crypto side. Jim Morrison and The Doors anyone?

  5. from the post :
    “The tax legislation just passed will lead to higher Government spending deficits”

    The oncoming problem stems from the fact that this same financial plan has always yielded the desired results (and not the ones stated publicly) and has worked every time it has been invoked. And of course it will work again this time because it works every time and it will continue to meet its objectives until it no longer does and only then will the significant future changes become the new paradigm.

    I’ve been holding PM’s for years and have seen little or no gain in their currency value. I have learned to ignore the experts and the book talkers and I don’t really care whether gold breaks support or is in a bull or bear market. In my opinion the only time PM’s will reflect their true purchasing power happens when these fake futures markets collapse and we are left with actual physical exchange as our price discovery method. I am not optimistic I will see this true value of PM’s in my lifetime but I do have some relatives who will likely have very fond memories of me.

  6. Have to think the USD is losing its grip and maybe we get it back to range in the 70’s or maybe even TP if /when we get our faced ripped off. I brought up the EFP’s a month or two back and you kinda poo-poo’d them along with Harvey’s premise. Now see Sprott and a few others are calling them out especially since they have reached such massive levels. Any new perspectives seriously with equivalents of 1/3 of annual productions in both Au/Ag its mind boggling to see the games being played? In a way Sprott has no excuses IMO for not finding out. I have heard him say won’t go there because he might lose some money….freaking please Eric your a billionaire. Can’t you risk a few hundred $K and take one for the team to find that heck out what’s really going on.

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