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"Western Central Banks Have Set Us Up; You'll Hear The Printing Presses From Mars"

Tyler Durden's picture




 

As Marc Faber said at SocGen's January conference, if he could short central banks directly he would do so, but gold is the next best thing; and despite it being sucked into the general commodity malaise, Albert Edwards says "Gold is a must-have holding in this world."

Via SocGen's Albert Edwards,

The Chinese have clearly shown investors that using Yoga-like mind games (or indeed loose money) to elevate the stock-market will end in tears.

This is undoubtedly a global story and I have not one scintilla of doubt that the western central banks have set us up for an even bigger version of the 2008 Great Financial Crisis/Recession - but this time rock bottom interest rates and large fiscal deficits will mean only one thing; QE will be stepped up to such a pace that you will hear the roar of the printing presses from Mars.

Gold is a must-have holding in that world.

Gold bulls will cite the 1970s experience as to why they are not worried about the current slump in the price, which many see continuing to $900.

For after rising some 550% between 1970 and the end of 1974, gold suffered a 50% retracement from $195 back to $100 before its 9-fold surge from 1976 to 1980 from $100 an ounce---to over $920 an ounce.

 

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Fri, 07/31/2015 - 09:50 | 6375131 SWRichmond
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Yoga-like mind games

Yoga is not a game.  I am certain of it.

Fri, 07/31/2015 - 09:56 | 6375150 Temporalist
Temporalist's picture

You are playing with the wrong woman then.

Fri, 07/31/2015 - 09:58 | 6375156 VinceFostersGhost
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The plan is to print to oblivion.....because there will be no one to blame.

Fri, 07/31/2015 - 10:04 | 6375187 NoDebt
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"QE will be stepped up to such a pace that you will hear the roar of the printing presses from Mars"

OK, I'm jealous because that's a line I wish I had come up with.

Still, they won't do that until they finish raising rates to 1%.  LOL

Fri, 07/31/2015 - 10:21 | 6375252 dontgoforit
dontgoforit's picture

Gold....Corvette?   Gold....Corvette?   Vvaaaarooommmmm!  Yeah, seemed like gold was losing it's currency.  But 'vettes!  They are a pretty good investment for a car - and they sure make you feel better!

Fri, 07/31/2015 - 12:58 | 6375947 Dead Canary
Dead Canary's picture

I've been watching Corvettes for a few months. C'mon silver! Make me rich!

Fri, 07/31/2015 - 19:59 | 6377379 Squid-puppets a...
Squid-puppets a-go-go's picture

and remember, in '75 they didnt have the mechanisms to suffocate the gold price as they do now

Fri, 07/31/2015 - 10:24 | 6375271 Cold-Pragmatism
Cold-Pragmatism's picture

No central bank will raise rates, they will all dare to, but they will not do it. If they did, you'll see a panic in every single debt loaded country in the world.

The printing presses will ROAR, and the ROARING '20s will be back, starting in 5 years from now!

And where is this stream of money going to go? Stock markets! As I have said, DOW 100,000! That's only 5x today's Dow, maybe even 200,000...

No, there is only one way for everything to go....the Abe Solution. As Japan is doing right now, the world will follow: BANZAI PRINTING!

 

Fri, 07/31/2015 - 11:14 | 6375495 TheFutureReset
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Yet the Nikkei is no where near all time highs. That doesn't follow. Printing will be to hold the stock market where it is. +- until it breaks.

The money will go into war efforts, not stocks. Govts will spend.  

Fri, 07/31/2015 - 09:53 | 6375118 JustObserving
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But, but, but, the WSJ says gold is the new pet rock

Let’s Be Honest About Gold: It’s a Pet Rock

http://blogs.wsj.com/moneybeat/2015/07/17/lets-be-honest-about-gold-its-...

The fiscal gap in the land of the free went from $60 trillion in 2003 to $210 trillion in 2014.  That's a rate that would allow you to buy all the gold bullion in this world (2 billion ounces) and all the silver bullion in this world (1 billion ounces) every 59 days

In 2003, just a little more than a decade ago, the fiscal gap was $60 trillion. But by last year it had catapulted to $210 trillion. 

http://www.brookings.edu/research/opinions/2015/04/08-federal-debt-worse...

Fri, 07/31/2015 - 09:58 | 6375154 Temporalist
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Funny that they aren't also calling diamonds pet rocks when people are willing to pay 10x that of gold to wear one shitty rock on a finger.

Fri, 07/31/2015 - 10:00 | 6375163 VinceFostersGhost
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I remember when I was a kid....the WSJ use to have class.

 

Now Rolling Stone is more respectable. Someone actually quit there because they got it wrong......WOW!

Fri, 07/31/2015 - 10:04 | 6375183 JustObserving
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WSJ was always the propaganda mouthpiece of Wall Street. But it turned into pure shit when Murdoch bought it.  But then, Satan has that special touch.

Sat, 08/01/2015 - 08:42 | 6378216 maxamus
maxamus's picture

That is because Rupert Murdoch bought it.

Fri, 07/31/2015 - 10:22 | 6375260 dontgoforit
dontgoforit's picture

Just look at every country, city or state run by minorities....

Fri, 07/31/2015 - 09:47 | 6375123 1stepcloser
1stepcloser's picture

if want outside the Debt based monetary system, you have to be in physcial PMs

Fri, 07/31/2015 - 10:17 | 6375245 jakesdad
jakesdad's picture

been stepping up my purchases of silver eagles...

 

I don't even look at them as an "investment" per se (if they go up great), more like an insurance policy against against us banks going greek...

Fri, 07/31/2015 - 09:50 | 6375130 agstacks
agstacks's picture

"if he could short central banks directly he would do so, but gold is the next best thing"

Shorting gold is the next best thing? :P

Fri, 07/31/2015 - 09:51 | 6375132 ArgentoFisico
ArgentoFisico's picture

Why in the last chart today prices are in Log while the old ones are not?

Fri, 07/31/2015 - 09:53 | 6375146 katchum
katchum's picture

To make the surge more spectacular of course.

Fri, 07/31/2015 - 10:12 | 6375197 ebworthen
ebworthen's picture

To show the similarity of the pattern, and because the value is in dollars - which are worth 80% less than they were then.

In other words, Gold to $12,000+ a Troy ounce when the fiat starts to burn.

Fri, 07/31/2015 - 09:51 | 6375135 vq1
vq1's picture

forgive me for my noobism.

 

1) How likely is it that if gold goes lower it will be impossible to buy? (because everone wants it)

2) paper gold is worthless?

Fri, 07/31/2015 - 10:01 | 6375169 lasvegaspersona
lasvegaspersona's picture

1 yes, very likely

2 not yet

Fri, 07/31/2015 - 10:03 | 6375179 LetThemEatRand
LetThemEatRand's picture

My take:

1) nobody knows.  It is well documented that gold is rehypothecated, but no one really knows how much physical is actually available for delivery.  A lot of commentators here and elsewhere have suggested for years that the squeeze was imminent, but hasn't happend yet (except possibly on the scale of central banks asking for some of their gold back and being told "we'll have it for you in seven years").

2) paper gold will be worthless if #1 ever happens.  Until then, it's like any other form of fiat.  It works until it doesn't.

Fri, 07/31/2015 - 10:16 | 6375240 Antifaschistische
Antifaschistische's picture

I remember when you used to go into any coin shop and buy as much gold as you wanted.  three weeks ago I go into the largest gold retailer in Houston and they said they won't have any Gold Eagles until 10+ days.  10+ days!!  They had zero...not a single one.

I'm not drawing any conclusions from this at all because I have no expertise in the gold supply chain, but I also do not think it's an irrelevant data point.

Fri, 07/31/2015 - 10:23 | 6375267 Latitude25
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Same in SW FL

Fri, 07/31/2015 - 09:52 | 6375136 Spungo
Spungo's picture

Posting that misleading gold chart should be an immediate ban. I'm not joking.

Fri, 07/31/2015 - 10:03 | 6375178 Panafrican Funk...
Panafrican Funktron Robot's picture

Log scale charts are misleading to people that don't understand log scale charts.  Pretty sure you just said "Ban people that post stuff that's too hard for a 2nd grader to understand."  And I say 2nd grader, because my 3rd grader understands log scale.

Having said that, the premise of this article (fiat currency devaluation = higher gold valuation in fiat terms) is unsupported by the facts.  It is a far more likely scenario that the price of gold in USD terms will continue to be intentionally suppressed via COMEX price manipulation.  That isn't a reason not to buy gold (people should definitely buy it), but buying it for the purposes of short term speculation is dumb.  

 

Fri, 07/31/2015 - 09:53 | 6375144 Montani Semper ...
Montani Semper Liberi's picture

Perhaps the algos are reading ZH now. Gold spiked $20 off it's low at the comex open today just as this article was published. Keep it up Tylers!

Fri, 07/31/2015 - 09:58 | 6375155 TheFineKid
TheFineKid's picture

I quickly read the story, but Jesus Christ how the fuck do you guys still have the energy to still yap about them? I am exhausted.

Fri, 07/31/2015 - 09:58 | 6375158 roisaber
roisaber's picture

You can't print the $2 quadrillion in liabilities (SS, Medicare, backstopping derivatives, and so on) the dollar has been saddled with.

 

Can you?

Fri, 07/31/2015 - 09:59 | 6375161 lasvegaspersona
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The chart shows values in the freegold range.

Folks laugh at $55k but this shows it would merely be history repeating.

Fri, 07/31/2015 - 10:00 | 6375165 crazytechnician
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Bitcoin user NOT affected

Fri, 07/31/2015 - 10:04 | 6375186 Seasmoke
Seasmoke's picture

What about the BC users who bought at $1000 ?????

Fri, 07/31/2015 - 10:08 | 6375198 crazytechnician
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There has been several surveys done of this and nobody has actually stepped forward crying about this , all indicators point to some bots that went beserk on the Mt.Gox , the price was not genuine , there were no human buyers , that's why Gox went belly up. The answer is if you don;t want to get Corzined hold the BTC in your own personal wallet.

Fri, 07/31/2015 - 17:41 | 6376959 Buster Cherry
Buster Cherry's picture

How many are there in a Monster Box?

Fri, 07/31/2015 - 10:46 | 6375361 Tigg47
Tigg47's picture

I prefer Bitgold.

 

Fri, 07/31/2015 - 11:36 | 6375599 TheFutureReset
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Bitcoin has surged nearly 30% against its competitor gold in the last couple of months. Http://theindex.io This should continue as gold is suppressed by paper. 

Fri, 07/31/2015 - 10:00 | 6375167 GFORCE
GFORCE's picture

The gold promoters are no more ethical than the Wall Street players they despise. Sold their ways at the top of the market and cost many their life savings with false dreams of hyperinflated riches. 

 

Fri, 07/31/2015 - 10:01 | 6375171 lordbyroniv
lordbyroniv's picture

Hi Martin !!!

Fri, 07/31/2015 - 10:10 | 6375207 crazytechnician
crazytechnician's picture

Charlatans selling gold to muppets who genuinely think there will be a return to a gold standard. Hilarious. What a bunch of planks.

Fri, 07/31/2015 - 10:37 | 6375331 roisaber
roisaber's picture

It's not our fault that they don't pay you enough at the troll farm to afford any.

Fri, 07/31/2015 - 10:00 | 6375168 lordbyroniv
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I am convinced we are all either Mad as Hatters or really really really prescient.

Fri, 07/31/2015 - 10:07 | 6375196 wholy1
wholy1's picture

What is the price [premium] to take physical possession at the time of purchase?

Fri, 07/31/2015 - 10:09 | 6375202 CoolClo
CoolClo's picture

"Gold is a must-have holding in this world."

I'm waitng for 681 support to be tested..

Fri, 07/31/2015 - 10:11 | 6375217 crazytechnician
crazytechnician's picture

I'm waiting for it to break down through 400 ...

Fri, 07/31/2015 - 10:11 | 6375219 MATA HAIRY
MATA HAIRY's picture

I wouldn't touch gold until it levels off for some time...

Fri, 07/31/2015 - 11:24 | 6375554 TheFutureReset
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Good choice. Wait to buy paper gold at 681. There will be no physical left. Cheers. 

Fri, 07/31/2015 - 14:09 | 6376211 Obama LaForge
Obama LaForge's picture

Sure there will be. People will be forced to sell to pay off debts, buy things, pay taxes, etc. QE is deflationary in the long run because it creates massive over investment and thus over supply. That's why you see stores lined with merchandise nobody is buying. Deflationary. The central banks are out of ammo, anyway. The crash won't come anyway until bank runs start. All these guys hocking gold are tricking people into keeping all the dollars in circulation. Take them out, and you create even more deflation. Gold is not legally money. It's an asset.

Fri, 07/31/2015 - 10:09 | 6375203 wstrub
wstrub's picture

Once in a BLUE MOON the worm turns.  Today could be that day.

Fri, 07/31/2015 - 10:10 | 6375214 MATA HAIRY
MATA HAIRY's picture

"Yoga-like mind games"??

 

keep on playing those mind games forever...?

Yoda-like???

These are not the momentum stocks you're looking for ...**waves hand***

Fri, 07/31/2015 - 10:11 | 6375216 Maestro Maestro
Maestro Maestro's picture

INDICTMENT

Americans are criminals because Americans violate the Constitution of the United States of America.

The U.S. President Obama, the entire U.S. Congress, the CIA, the FBI, the U.S. Military, and the entire Police Force of these United States SWORE to protect, serve and uphold the U.S. Constitution.

The U.S. Constitution forbids usage of debt as money (referred to as 'notes') and stipulates that only gold and silver can be used as money.

Yet,

Americans commit or support and condone the murder and torture human beings throughout planet earth in the name of democracy and freedom, all for the sake of acquiring Constitutionally fraudulent and illegal Federal Reserve Notes a.k.a (counterfeit) U.S. Dollars.

Since the United States is a democracy and Americans only elect Democrats and Republicans who perpetuate this unlawfulness,

Americans are indicted criminals according to the United States Constitution.

Spread the word.

Fri, 07/31/2015 - 11:05 | 6375449 Deathrips
Deathrips's picture

Close....but no cigar.

There arent elections theres dieBOLD!!

 

RIPS

 

 

Fri, 07/31/2015 - 10:16 | 6375235 Calculus99
Calculus99's picture

Gold is finished because I read it last week in the Wall Street Journal.

They told me to be 'honest' and realise it was a 'pet rock'.

What a bunch of tossers. 

Fri, 07/31/2015 - 10:16 | 6375237 Atomizer
Atomizer's picture

Hillary, Louis Lerner have set the bar for Ctrl+alt+delete. Restore to a previous time? Oh noes, you have mutiple saving points. Which one should we direct to cleanse your computer?  Simple example......We have more sophisticated software.  

https://forensiccontrol.com/resources/free-software/

 

Fri, 07/31/2015 - 10:16 | 6375238 Chuck Knoblauch
Chuck Knoblauch's picture

It means the US will continue to use force to support its broken system.

Fri, 07/31/2015 - 10:32 | 6375263 withglee
withglee's picture

Shades of global warming hockey stick illustration. With all the manipulation going on, there's no telling what the real truth is. I still think you're better off holding double-jambs than gold when the reset comes ... and if it doesn't come.

Fri, 07/31/2015 - 10:25 | 6375273 pebblewriter
pebblewriter's picture

Who woulda thunk it?  As we posted in Jul 24:

 ...it’s worth noting that GC just tagged that yellow .500 Fib level and the bottom of a fairly well-formed channel at 1072.3 that could mean a significant bounce. The initial target would be the neckline (1140) of the just-completed H&S Pattern (that targets 970.)  If things really got going, 1285 looks mighty interesting.

http://pebblewriter.com/markets/gold/

 

Fri, 07/31/2015 - 10:59 | 6375415 cocoablini
cocoablini's picture

The 1971-80's graph is a hyperinflationary bust when Nixon defaulted on US debt and killed the gold standard. The ensuing wreckage was pretty obvious back then, as the Saudis and OPEC got stuck with TBONDS for their gold.

Our age is a hyperdeflationary bust- since all currency (except physical gold) is debt. Overall money supply collapses, no matter how much the FED and CBs print because the private sector has created too much dollar-denominated debt(like an order magnitude more than FED.) As those "assets" lose value, the money supply collapses, margin calls are made and the dollar will be pretty tough. The FED has to manipulate the stock market to prevent the triggering of a deflationary bust-they have no chance as financial systems begin to die all over the globe(China, Greece, MFGlobal.) They are just stretching out the disaster, hoping a solution walks up. But since the system is totally flawed as a mechanism, it's going down hard...really hard. Hence all the autocratic reforms, wealth hoarding by rich and so forth. Good luck out there

Fri, 07/31/2015 - 11:20 | 6375531 trippy64
trippy64's picture

*Yoda

There, fixed it for ya

Fri, 07/31/2015 - 13:20 | 6376039 Able Ape
Able Ape's picture

GOT to keep Uncle Scam's titties FULL and FLOWING for the sucklers...

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