keiser report

Subscribe to keiser report feed keiser report
Gold, Silver, Bitcoin
Updated: 25 min 46 sec ago

The War on the Post Office

3 hours 46 min ago

The US Postal Service, under attack from a manufactured crisis designed to force its privatization, needs a new source of funding to survive. Postal banking could fill that need.

The US banking establishment has been at war with the post office since at least 1910, when the Postal Savings Bank Act established a public savings alternative to a private banking system that had crashed the economy in the Bank Panic of 1907. The American Bankers Association was quick to respond, forming a Special Committee on Postal Savings Legislation to block any extension of the new service. According to a September 2017 article in The Journal of Social History titled “‘Banks of the People’: The Life and Death of the U.S. Postal Savings System,” the banking fraternity would maintain its enmity toward the government savings bank for the next 50 years.

As far back as the late 19th century, support for postal savings had united a nationwide coalition of workers and farmers who believed that government policy should prioritize their welfare over private business interests. Advocates noted that most of the civilized nations of the world maintained postal savings banks, providing depositors with a safe haven against repeated financial panics and bank failures. Today, postal banks that are wholly or majority owned by the government are still run successfully not just in developing countries but in France, Switzerland, Israel, Korea, India, New Zealand, Japan, China, and other industrialized nations.

The US Postal Savings System came into its own during the banking crisis of the early 1930s, when it became the national alternative to a private banking system that people could not trust. Demands increased to expand its services to include affordable loans. Alarmed bankers called it the “Postal Savings Menace” and warned that it could result in the destruction of the entire private banking system.

But rather than expanding the Postal Savings System, the response of President Franklin Roosevelt was to buttress the private banking system with public guarantees, including FDIC deposit insurance. That put private banks in the enviable position of being able to keep their profits while their losses were covered by the government. Deposit insurance along with a statutory cap on the interest paid on postal savings caused postal banking to lose its edge. In 1957, under President Eisenhower, the head of the government bureau responsible for the Postal Savings System called for its abolition, arguing that “it is desirable that the government withdraw from competitive private business at every point.” Legislation to liquidate the Postal Savings System was finally passed in 1966. One influential right-wing commentator, celebrating an ideological victory, said, “It is even conceivable that we might transfer post offices to private hands altogether.”

Targeted for Takedown

The push for privatization of the US Postal Service has continued to the present. The USPS is the nation’s second largest civilian employer after WalMart and has been successfully self-funded without taxpayer support throughout its long history; but it is currently struggling to stay afloat. This is not, as sometimes asserted, because it has been made obsolete by the Internet. In fact the post office has gotten more business from Internet orders than it has lost to electronic email. What has pushed the USPS into insolvency is an oppressive congressional mandate that was included almost as a footnote in the Postal Accountability and Enhancement Act of 2006 (PAEA), which requires the USPS to prefund healthcare for its workers 75 years into the future. No other entity, public or private, has the burden of funding multiple generations of employees yet unborn. The pre-funding mandate is so blatantly unreasonable as to raise suspicions that the nation’s largest publicly-owned industry has been intentionally targeted for takedown.

What has saved the post office for the time being is the large increase in its package deliveries for Amazon and other Internet sellers. But as Jacob Bittle notes in a February 2018 article titled “Postal-Service Workers Are Shouldering the Burden for Amazon,” this onslaught of new business is a mixed blessing. Postal workers welcome the work, but packages are much harder to deliver than letters; and management has not stepped up its hiring to relieve the increased stress on carriers or upgraded their antiquated trucks. The USPS simply does not have the funds.

Bittle observes that for decades, Republicans have painted the USPS as a prime example of government inefficiency. But there is no reason for it to be struggling, since it has successfully sustained itself with postal revenue for two centuries. What has fueled conservative arguments that it should be privatized is the manufactured crisis created by the PAEA. Unless that regulation can be repealed, the USPS may not survive without another source of funding, since Amazon is now expanding its own delivery service rather than continuing to rely on the post office. Postal banking could fill the gap, but the USPS has been hamstrung by the PAEA, which allows it to perform only postal services such as delivery of letters and packages and “other functions ancillary thereto,” including money orders, international transfers, and gift cards.

Renewing the Postal Banking Push

Meanwhile, the need for postal banking is present and growing. According to the Campaign for Postal Banking, nearly 28% of US households are underserved by traditional banks. Over four million workers without a bank account receive pay on a payroll card and spend $40-$50 per month on ATM fees just to access their pay. The average underserved household spends $2,412 annually – nearly 10% of gross income – in fees and interest for non-bank financial services. More than 30,000 post offices peppered across the country could service these needs.

The push to revive postal banking picked up after January 2014, when the USPS Inspector General released a white paper making the case for postal banks and arguing that many financial services could be introduced without new congressional action. The cause was also taken up by Sen. Elizabeth Warren and Sen. Bernie Sanders, and polling showed that it had popular support.

In a January 2018 article in Slate titled “Bank of America Just Reminded Us of Why We Need Postal Banking,” Jordan Weissman observes that Bank of America has now ended the free checking service on which lower-income depositors have long relied. He cites a petition protesting the move, which notes that Bank of America was one of the sole remaining brick-and-mortar banks offering free checking accounts to their customers. “Bank of America was known to care for both their high income and low income customers,” said the petition. “That is what made Bank of America different.” But Weissman is more skeptical, writing:

What this news mostly shows is that we shouldn’t rely on for-profit financial institutions to provide basic, essential services to the needy. We should rely on the post office.

In spite of what some of its customers may have thought, Bank of America never cared very much about its poorer depositors. That’s because banks don’t care about people. They care about profits. And lower-middle class households who have trouble maintaining a minimum balance in a checking account are, by and large, not very profitable customers, unless they’re paying out the nose in overdraft fees.

Those modest accounts won’t be hugely profitable for the Postal Service either, but postal banking can be profitable through economies of scale and the elimination of profit-taking middlemen, as postal banks globally have demonstrated. The USPS could also act immediately to expand and enhance certain banking products and services within its existing mandate, without additional legislation. According to the Campaign for Postal Banking, these services include international and domestic money transfers, bill pay, general-purpose reloadable postal cards, check-cashing, automated teller machines (ATMs), savings services, and partnerships with government agencies to provide payments of government benefits and other services.

A more lucrative source of postal revenue was also suggested by the Inspector General: the USPS could expand into retail lending for underserved sectors of the economy, replacing the usurious payday loans that can wipe out the paychecks of the underbanked. To critics who say that government cannot be trusted to run a lending business efficiently, advocates need only point to China. According to Peter Pham in a March 2018 article titled “Who’s Winning the War for China’s Banking Sector?”:

One of the largest retail banks is the Postal Savings Bank of China. In 2016 retail banking accounted for 70 percent of this bank’s service package. Counting about 40,000 branches and servicing more than 500 million separate clients, the Postal Savings Bank’s asset quality is among the best. Moreover, it has significantly more growth potential than other Chinese retail banks.

Neither foreign banks nor private domestic retail banks can compete with this very successful Chinese banking giant, which is majority owned by the government. And that may be the real reason for the suppression of postal banking in the US. Bankers continue to fear that postal banks could replace them with a public option – one that is safer, more efficient, more stable, and more trusted than the private financial institutions that have repeatedly triggered panics and bank failures, with more predicted on the horizon.

This article was originally published on  


How Much Longer Can We Get Away With It?

Sat, 03/17/2018 - 12:54

This chart of “debt securities and loans”–i.e. total debt in the U.S. economy–is also a chart of the creation and distribution of new money, as the issuance of new debt is the mechanism in our financial system for creating (or “emitting” in economic jargon) new currency: when a bank issues a new home mortgage, for example, the loan amount is new currency created out of the magical air of fractional reserve banking.

Central banks also create new currency at will, and emitting newly created money is how they’ve bought $21 trillion in assets such as bonds, mortgages and stocks since 2009. Is there an easier way to push asset valuations higher than creating “money” out of thin air and using it to buy assets, regardless of the price? If there is an easier way, I haven’t heard of it.

Which brings us to the question: how much longer can we get away with this travesty of a mockery of a sham? How much longer can we get away with creating “money” by issuing new debt/liabilities to grease the consumption of more goods and services and the purchases of epic bubble-valuation assets?

Since humans are still using Wetware 1.0 (a.k.a. human nature), we can constructively refer to the Roman Empire’s experience with creating “money” with no intrinsic value. The reason why the Roman Empire (Western and Eastern) attracts such attention is 1) we have a fair amount of documentation for the period, something we don’t have for other successful empires such as the Incas, and 2) we’re fascinated by the decline and collapse of the Western Empire, a structure so vast and successful that collapse seemed impossible just a few decades before the final unraveling.

One of the books I’m currently enjoying is The Fate of Rome: Climate, Disease, and the End of an Empire, a new exploration of the impact of climate change and pandemics on the Roman Empire’s final few centuries.

The key takeaway is that climate change undermined the production of grain while the arrival of previously unknown diseases via trade routes stretching from Rome to China, India and the interior of Africa decimated the productive populace. Add in the rise of well-organized “barbarians” and the political instability born of a self-serving, ossified elite and voila, you have an excellent recipe for crisis.

Crises tend to reduce tax collections and increase government/Imperial costs, and this creates a fiscal/financial crisis. The Romans didn’t have a fiat currency that a central bank could create out of thin air, so they did the next best thing which was to replace their mostly-silver coinage with new base-metal coinage that had been washed in silver. That is, they debased/devalued their money, replacing coinage with an intrinsic value of silver with coinage with little to no intrinsic value.

They got away with this debasement/ devaluation for quite a few years, and so naturally they reckoned they could get away with it forever. But alas, debauching the currency is not a permanent solution to insolvency; it is a one-time trick that fools the market and populace for a time but soon enough people catch on and bad money drives out good money (Gresham’s law) as people hoarded the old silver coins and tried to trade the worthless new coins for anything but more worthless “money.”

In the present, we see this process at work in Venezuela, where the government has debauched the nation’s currency, the bolivar, to the point that inflation (i.e. loss of purchasing power) is running around 7,000% annually.

So how long can we get away with creating “money” out of thin air and using it to pump up asset prices? The Roman leaders who in desperation debased the Empire’s currency/coinage must have been chortling at the fast one they pulled on the Empire’s merchants, markets, farmers and soldiers, and we must forgive their avid willingness to believe that they could get away with it essentially forever.

Alas, fakery isn’t actually a solution to fiscal/financial crisis. At this moment in time, our “leadership” is basking in the hubris-soaked confidence that we can get away with it if not forever then for decades to come: we can borrow currency into existence in as many trillions as we desire, and inflation will remain dormant, consumption will remain robust and everyone will accept the debauched currency as having value.

Until they don’t. This is typically a sudden and unexpected event, as this chart of the exchange rate of the bolivar to the US dollar shows: the slide from 10 bolivars to the USD to 25 bolivars to one USD was gradual, but the implosion to 200,000 bolivars to the USD was frighteningly rapid.

No doubt the Romans said, “it can’t happen here”–but they were wrong. 

My new book Money and Work Unchained is $9.95 for the Kindle ebook and $20 for the print edition.

Read the first section for free in PDF format. 

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via

Crock Of Gold Hidden In Ireland? Happy Saint Patrick’s Day

Fri, 03/16/2018 - 19:17

Crock Of Gold In Ireland? Happy Saint Patrick’s Day

Wishing you health, wealth and good luck this Saint Patrick’s Day!

May your home be filled with laughter  May your pockets be filled with gold
And may you have all the happiness
Your heart can holdThis Saint Patrick’s Day we bring you an interesting article from the Irish Post about the history of gold mining in Ireland and Ireland’s hidden gold hotspots.

by Jack Beresford via the Irish Post

IRELAND has a long and rich history of gold mining, dating back to the 1800s and continuing even today.

The first Irish gold rush occurred from 1795 through to 1860 with around 300kg of the mineral hand-mined from deep within the Emerald Isle.

Discoveries are still being made today with gold worth €546million recently uncovered at a mining site in Clontribet, Co. Monaghan just this week.

Valued at around €1,050 an ounce, discovering gold can be a life-changing experience – but where do you look?

According to the experts, Ireland has a couple of notable hidden gold hotspots – but do you live near one of them?

History indicates that some small clues to the true location of these hidden goldmines can be found in the place names of many of Ireland’s villages, mountains, rivers and towns.

These places were handed their names for a reason and indicate that there could well be gold in these old hills.

Here are some of the most famous supposed gold hotspots.



Slieveanore, which roughly translates as ‘Mountain of Gold’, near Feakle in Co. Clare is a townland thought to have been named in reference to the fact there was once an abundance of the mineral around the region.

Whether any still remains is a source of some speculation.


Down towards the south coast of Ireland, between Bantry and Dunmanway in Co. Cork sits Coomanore, which translates to ‘Hollow of the Gold’ and is said to offer riches to anyone able to locate the source of that most precious and valued of minerals.


Take a trip down to Luganore near Clonmel, Tipperary and you may come back with more than you bargained for.

Also known as the ‘Hollow of the Gold’, it’s attracted plenty of interest down the years from people looking to find their fortune.


Otherwise known as the Glen of the Gold, Glenanore in Co. Cork is another favourite stomping ground for those eager to uncover the secrets living within these lands.

Several other possible gold hotspots, meanwhile, have emerged as a result of notable discoveries down the years.


Ancient mining and smelting equipment and materials was uncovered in a bog near the popular Irish city.

Thought to be several thousand years old and sizeable in scale, the discovery prompted speculation that there could be more gold hidden in the region.


A giant sluice box, dating back thousands of years, was uncovered under several feet of river gravels in the Woodenbridge area of the city. What else lies beneath?

Glendalough, Co. Wicklow. Picture: Tourism Ireland

Gold has also been discovered The River Dargle, The Avoca, The Avonbeg and at the foot of Bray Head. Other areas of Ireland where gold has been discovered include: The River Dodder near Rathfarnham, Cregganbaun and Croagh Patrick, Cavanacaw, Clontibret, Lecanvey and Bohaun in County Glaway.

In fact, it is likely that there are many more sources all over the country, given the sheer quantity of gold found dating as far back as the Bronze Age and now stored in national museums.

Ireland’s gold rush is still far from being over.



News and Commentary

Gold at 2-week low as dollar weighs, investors eye political tensions (

PRECIOUS-Gold steady as political concerns offset rate hike fears (

Venezuela gold reserve value falls 14 pct in 2017 (

Stocks Drift, Dollar Drops Amid Political Turmoil: Markets Wrap (

Bitcoin’s ‘Death Cross’ Looms as Strategist Eyes $2,800 Level (

The Many Uses of Gold (

$500 million in gold bullion rains down on Siberia after aircraft cargo bungle (

Tons of gold fall from sky in Russian cargo plane blunder (VIDEO, PHOTOS) (

Gold’s relationship to interest rates isn’t so simple – Kosares (

Forget Brexit – here’s the real reason the UK housing market is fragile (

Gold Prices (LBMA AM)

15 Mar: USD 1,323.35, GBP 949.24 & EUR 1,070.72 per ounce
14 Mar: USD 1,324.95, GBP 949.59 & EUR 1,071.35 per ounce
13 Mar: USD 1,318.70, GBP 948.94 & EUR 1,069.60 per ounce
12 Mar: USD 1,317.25, GBP 950.66 & EUR 1,069.87 per ounce
09 Mar: USD 1,319.35, GBP 955.21 & EUR 1,072.50 per ounce
08 Mar: USD 1,325.40, GBP 955.08 & EUR 1,070.39 per ounce
07 Mar: USD 1,332.50, GBP 960.07 & EUR 1,071.86 per ounce

Silver Prices (LBMA)

15 Mar: USD 16.52, GBP 11.86 & EUR 13.37 per ounce
14 Mar: USD 16.61, GBP 11.88 & EUR 13.42 per ounce
13 Mar: USD 16.51, GBP 11.88 & EUR 13.38 per ounce
12 Mar: USD 16.46, GBP 11.88 & EUR 13.39 per ounce
09 Mar: USD 16.49, GBP 11.92 & EUR 13.40 per ounce
08 Mar: USD 16.48, GBP 11.89 & EUR 13.31 per ounce
07 Mar: USD 16.65, GBP 12.01 & EUR 13.42 per ounce


Buy Silver And Sell Gold Now

Fri, 03/16/2018 - 07:52

– Buy silver and sell gold now – Frisby
– Gold should cost 15 times as much as silver
– Silver might have disappointed in short term – But it’s time to buy
– Editor’s note: Silver has outperformed stocks, bonds and gold over long term (see table)

by Dominic Frisby via Money Week

For those of you with busy schedules who like to see arguments made in 280 characters or less, let me come straight to the point: the time has come to sell your gold and buy silver.

Got that?

Right. Now, those of you who are interested to know why I would make such an assertion, read on.

In an ideal world, gold would cost 15 times as much as silver.

Silver Britannia 2018 (VAT Free In EU and CGT free for UK investors

The gold-silver ratio measures how many ounces of silver it takes to buy an ounce of gold. If the ratio is at, say, 75, then gold is 75 times the price of silver and it would take 75 ounces of silver to buy an ounce of gold.

Geologists seem to agree that there is somewhere around 15 times more silver in the Earth’s crust than gold. Gold is therefore 15 times rarer.

In theory, therefore, the gold-silver ratio should stand at 15 – gold should be 15 times the price of silver. And until the 20th century, that was mostly the case. Indeed, there are many examples of nations which operated under a bi-metallic standard – the USA until 1875 being perhaps the most famous – where the exchange rate between the two metals was 15, more or less.

However, in the 20th century, as money and metal went their separate ways, that ratio of 15 has become an ever-more distant memory. One day it will get there again, the most ardent of silver bugs will tell you.

And on one day in 1980, it did – on 18 January 1980, silver went to $50 as the infamous Hunt Brothers attempted to corner the market.

But since then the closest it has been was 30, in April 2011, when silver touched $50.

Here, courtesy of our man in Australia, gold and silver data hound Nick Laird of, is the gold-silver ratio since 1720.

Gold-silver ratio since 1720

Click here to read full story on


Stephen Hawking – Doomsday Prophet’s Top Five Predictions

Fri, 03/16/2018 - 05:53

– Stephen Hawking, the doomsday prophet & visionary physicist died yesterday
– Hawking’s five doomsday warnings highlight the need for a ‘Plan B’
– Hawking predicted A.I. may be “the worst thing” for humans
– Vocal critic of President Trump and warned about the risk of nuclear war
– “Nuclear war remains the greatest danger to the survival of the human race”

Photo by Simon Steinberger via Flickr

Stephen Hawking, the visionary physicist who died early yesterday at the age of 76,  made five predictions about how and when mankind will face its doom.

In a week when geo-political tensions between the world’s two leading nuclear powers, Russia and the U.S. are worsening with the UK and U.S. accusing Russia of a nerve agent attack and imposing sanctions on Russia, it is a good time to consider and heed Hawking’s doomsday predictions or warnings, especially about nuclear war.

Below is an interesting article which looks at five of Hawking’s doomsday predictions as collated by

WE NEED an exit strategy. Fast.

From global warming to artificial intelligence, Professor Stephen Hawking made a number of terrifying predictions about the apocalyptic threats facing humanity.

The celebrated late scientist said humanity is at a “tipping point”, and that our best bet will be to leave Earth completely.

Here are five main factors he said are contributing to the end of the world.


In 2007, Prof Hawking fronted a campaign to cancel Trident, Britain’s nuclear weapons deterrent.

“Nuclear war remains the greatest danger to the survival of the human race,” he said.

“To replace Trident would make it more difficult to get arms reduction, and increase the risk.

“It would also be a complete waste of money because there are no circumstances in which we would use it independently.”

Prof Hawking has also identified “aggression” as the human trait will destroy us all.

He warned it could lead to irrational actions, like sparking nuclear war.

Prof Hawking said nuclear war remains the ‘greatest danger’ to humanity’s survival.

“I fear evolution has in-built greed and aggression to the human genome,” he told the BBC. “There is no sign of conflict lessening, and the development of militarised technology and weapons of mass destruction could make that disastrous. The best hope for the survival of the human race might be independent colonies in space.”

Click here to read full story on


Sign up for our Market Updates and or Podcasts Here

Interested in learning more about physical gold and silver?
Call GoldCore and speak with a gold and silver specialist today


Checking In on the Four Intersecting Cycles

Thu, 03/15/2018 - 11:56

Correspondent James D. recently asked for an update on the four intersecting cycles I’ve been writing about for the past 10 years. Here’s the chart I prepared back in 2008 of four long-term cycles:

1. Generational (political/social)

2. Price inflation/wage stagnation (economic)

3. Credit/debt expansion/contraction (financial)

4. Relative affordability of energy (resources)

Here are four of the many dozens of essays I’ve written on these topics over the past decade:

Long Cycles: Cheaper Goods, Costlier Capital, Income Disparity Increases (August 1, 2008)

Beyond the False Dawn: Global Crisis 2020-2022 (February 18, 2011)

A Disintegrative Winter: The Debt and Anti-Status Quo Super-Cycle Has Turned(December 5, 2016)

We’re in a Boiling-Point Crisis of Exploitive Elites (June 19, 2017)

The key point that’s not communicated in the chart is there are dynamics that interact with each of these cycles. For example, demographics are influencing each of these trends in self-reinforcing ways.

Governments are borrowing more to fund the promises made to seniors decades ago when there were relatively few retirees compared to the working populace. Now that the ratio of those collecting government benefits to workers is 1-to-2 (one retiree for every worker), the system is buckling.

The “solution” is to borrow increasing sums from future taxpayers to fund pay-as-you-go healthcare and pension programs for retirees.

Technology is another dynamic that is actively influencing all these cycles in self-reinforcing ways. As technology is substituted for human labor, wages stagnate and the size of the populace paying taxes dwindles accordingly. The “solution” is once again to borrow more to substitute for declining purchasing power.

The dynamics driving wealth/income inequality and the rise of politically/financially dominant elites are also powering these cycles. As Peter Turchin has explained–a topic covered in my essay When Did Our Elites Become Self-Serving Parasites? (October 4, 2016)– social disunity / discord rises when the number of people promised a spot in the elite far exceeds the actual number of slots available.

In summary, the four cycles are intact and poised to intersect in a very messy fashion within the next decade. various centralized efforts have been made to paper over the secular stagnation, political polarization, brewing generational wars, resistance to globalism, rising cost of capital, decay of opportunity, soaring debts, rising dominance of speculation / malinvestment /mis-allocation of capital, diminishing returns on centralization, the marriage of Orwell, Huxley and Kafka in officially sanctioned propaganda, increasingly dysfunctional and self-serving institutions and the rising costs of energy, but every one of these makeshift efforts further erodes the resilience of the overall system and increases systemic fragility and vulnerability to self-reinforcing failures of key subsystems.

Here are a few charts that illustrate the trends / cycles:

Total systemic debt: note that the tiny wobble in credit expansion in 2008 nearly collapsed the entire global financial system.

Here’s political polarization: notice any common ground?

The elites that are safely protected by the moat of the status quo are doing just fine while the disgruntled debt-serfs who were promised security and rising wages/wealth are massing beyond the moat.

Meanwhile, asset bubbles and soaring debt are the status quo’s go-to fix for every problem:

If you think this is a robust, resilient, stable system, please check your Ibogaine / Hopium / Delusionol intake. 

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via

Gold Cup At Cheltenham – Gold Is For Winners, Not For the Gamblers

Wed, 03/14/2018 - 09:00

– Gold Cup at Cheltenham – ‘The Olympics’ of the European horse racing calendar  

– Gold Cup trophy contains 10 troy ounces of gold – worth £9,000

– £620 million bets on horses, 230,000 pints of Guinness will be drunk, 9.2 tonnes of potato eaten 

– Since the 5th century BC, gold has been the ultimate prize to award champions and gold has been constantly and universally awarded as top prize 

– Gold, like the summit of human achievement, is very rare and hence precious

– Gold is a great prize and a good bet but works best as store of value and better to take a ‘punt’ on gold than gamble on the horses

Cheltenham Gold Cup – Wikipedia

The Cheltenham Gold Cup race takes place this Friday, March 16 at 3.30pm. The Gold Cup is the finale of the Cheltenham Festival, the Olympics of horse jump racing, which runs from yesterday to this Friday.

This week 65,000 people have been gathering in Cheltenham for the 28 races which will be raced over the four day gathering with over £4,600,000 of prize money will be handed out this week at Cheltenham Festival.

The Gold Cup is the most prestigious of the most prestigious of all National Hunt events and it is sometimes referred to as the Blue Riband of horse jump-racing. The race takes place over 3 miles 2½ furlongs (5,331 m) and includes 22 fences to be jumped.

The prize for winning the Gold Cup is £600,000. and the beautiful Gold Cup trophy made with 10 ounes of gold.

The prize for those who turn up to watch the world famous event? The chance to experience the excitement and fun of race day and likely lose a few bob – with a massive £600 million staked on the outcome of the races. As we know the bookie nearly always win.

10 ounces of gold and over half-a-billion British pounds of cash surrounding one event. What does this say about the state of our economy today and how we award our sporting heroes?

Click here to read full story on

Interested in learning more about physical gold and silver?
Call GoldCore and speak with a gold and silver specialist today

Hungary’s Gold Repatriation Adds To Growing Protest Against US Dollar Hegemony

Tue, 03/13/2018 - 08:23

Hungary’s Gold Repatriation Adds To Growing Protest Against US Dollar Hegemony

– Hungarian National Bank (MNB) to repatriate 100,000 ounces gold from Bank of England
– Follows trend of Netherlands, Germany, Austria and Belgium each looking to bring gold back to home soil
– Hungary one of the smallest gold owners amongst central banks, with just 5 tonnes
– Central bank gold purchases continue to be major drivers of gold market
– Russian central bank gold reserves now exceed those of China
– Decisions to repatriate and increase gold reserves come as rifts between East and West widen

A country’s sovereignty is becoming the driving force of so many changes in the geopolitical sphere, today. Whether it is Brexit, surprise electoral victories in central Europe or a change in trade deals, sovereignty is at the forefront of so many of these decisions.

One of the first indicators that there was a change in the water when it comes to globalisation and international cooperation was through central bank gold buying and repatriation.

For some time now many central banks have been working on building up their gold reserves and ensuring they are stored on soil it believes to be safe and trustworthy.

The most recent central bank to make this change is that of Hungary. Last week it was announced that it intends to bring 100,000 ounces of its very limited 5 tonnes gold reserves, back home from the Bank of England.

This is not an unusual move. In recent years we have seen the likes of Germany, Venezuela and the Netherlands each repatriate their gold from various locations. The pace does appear to have been picking up since the late Hugo Chavez decided to bring home 180 tonnes of gold in 2011.

Furthermore, huge central banks namely Russia and China have been adding to their gold hoards, one more publicly than the other. Both have also been encouraging the use of gold as a means of payment in international trade as a means of avoiding US dollar hegemony.

The decision to place more focus on gold reserves is a statement by central banks and their governments to reduce the counterparty risk on their reserve assets. When holding another country’s currency you are vulnerable, the same applies to when a third-party holds your gold at a time when their own assets are perhaps more exposed than you’re comfortable with.

Click here to read full story on

There is No “Free Trade”–There Is Only the Darwinian Game of Trade

Mon, 03/12/2018 - 12:02

Stripped of lofty-sounding abstractions such as comparative advantage, trade boils down to four Darwinian goals:

1. Find foreign markets to absorb excess production, i.e. where excess production can be dumped.

2. Extract foreign resources at low prices.

3. Deny geopolitical rivals access to these resources.

4. Open foreign markets to domestic capital and credit so domestic capital can buy up all the productive assets and resources, a dynamic I explained last week in Forget “Free Trade”–It’s All About Capital Flows.

All the blather about “free trade” is window dressing and propaganda. Nobody believes in risking completely free trade; to do so would be to open the doors to foreign domination of key resources, assets and markets.

Trade is all about securing advantages in a Darwinian struggle to achieve or maintain dominance. As I pointed out back in 2005, the savings accrued by consumers due to opening trade with China were estimated at $100 billion over 27 years (1978 to 2005), while corporate profits expanded by trillions of dollars.

China Trade Surplus: Gusher Profits for U.S. Corporations (August 13, 2005)

In other words, consumers got a nickel of savings while corporations banked a dollar of pure profit as sticker prices barely budged while input costs plummeted. Corporations pocketed the difference, not consumers.

As longtime correspondent Chad D. noted in response to my essay on capital flows, restricting trade may be one of the few ways smaller nations have to avoid their resources and assets being swallowed up by mobile capital flowing out of nations with virtually unlimited credit (the US, the EU, China and Japan).

Protecting fragile domestic industries with tariffs has a long history, including in the US, but the real action isn’t in tariffs: it’s in the bureaucratic tools to limit trade and the soft and hard power plays that secure cheap resources while denying access to those resources to geopolitical rivals.

The bureaucratic means of restricting imports have been raised to an art in Japan and other export-dependent nations: there may not be any visible tariffs, just bureaucratic sinkholes that tie up imports in red tape.

Then there’s currency manipulation, for example, China’s peg to the US dollar.What’s the “free market” price of Chinese goods in the US? Nobody knows because the peg protects China from its own currency being too strong or too weak to benefit its export-dependent economy.

Those bleating about “free trade” are simply pushing a Darwinian strategy that benefits them above everyone else. US corporate profits have quadrupled since China entered the WTO; is this mere coincidence? No: global corporations arbitraged labor, credit, taxes, environmental/regulatory and currency inputs to dramatically lower their costs (and the quality of the goods they sold credit-dependent consumers) and thus boost profits four-fold in a mere 15 years while tossing the hapless consumers a few nickels of “lower prices always” (and lower quality always, too).

The Neoliberal Agenda trumpets “free trade” because “free trade” is a cover for “free capital flows.” Once capital is free to flow from central-bank fueled global corporations, no domestic bidder can outbid foreign mobile capital, as those closest to the central bank credit spigots can borrow essentially unlimited sums at near-zero rates–an unmatched advantage when it comes to snapping up resources and assets.

If we ask cui bono, to whose benefit?, we find the consumer has received shoddy goods and paltry discounts from “free trade,” while corporations, banks and financiers have benefited enormously.

Rising income and wealth inequality is causally linked to globalization and the expansion of Darwinian trade and capital flows: the winners are few and the losers are many. Tariffs will not solve the larger problems of reduced employment, stagnant wages and rising income inequality. To make a dent in those issues, we’ll need to tackle central bank and central-state policies that have pushed financial speculation to supremacy over the productive economy.


My new book Money and Work Unchained is $9.95 for the Kindle ebook and $20 for the print edition.

Read the first section for free in PDF format. 

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via

Gold And Silver At Risk Of A Cartel Manufactured ‘Sell The Rumor, Buy The News’ This Week?

Mon, 03/12/2018 - 09:37

Picking up where we left off last Friday, we can see that everything is awesome in the mainstream.

The Nasdaq hit an all-time high on Friday:

So while the Dow and the S&P are still banging around their 50-day moving averages, it appears that certain parts of the stock market are not phased by tariffs, geo-politics and a hot job market that all but assures a rate hike next week.

We can see that while Monday may be off to a slow start, Tuesday through Friday have plenty of opportunities for the manipulators to show us just how awesome everything is:

Hard data, soft data, inflation data, retail sales data, employment data, industrial production data, and housing market data oh my.

It’s just a liar’s statistician’s dream this week.

In fact there are market moving data releases every day starting on Tuesday precisely at 8:30 a.m. EST, and as everybody here knows, that’s one full hour before the markets even officially open.

Translation: Look for pre-market smashes and the cartel taking advantage of the thinly traded markets to blow through the stops and smash gold & silver prices.

Here’s the logic.

The market is near certain that the Fed will raise rates next week. All of the data points we get this week will only serve the purpose of solidifying that reality. The mainstream thinking is that rate hikes are bad for gold & silver. Rate hikes are not bad for gold & silver. Gold & silver are hedges against inflation and rise accordingly.

Furthermore, Anybody who is not in the 1% or living and/or serving in corrupt Washington knows that inflation is running hotter than, for example, the benchmark interest rate on the 10-year Treasury Note. This means that when factoring for inflation, real yields are negative. A negative real yield is good for gold because it the yellow metal serves as wealth preservation.

So no matter what happens next week, it’s good for gold & silver.

It is possible we won’t get a blow-out number like last week’s jobs number in the data releases this week.


To keep the markets “guessing” the Fed and try to add some semblance of a market working on it’s own, the ESF and the Fed like to move markets to show there are some human forces behind what is mostly computerized, algorithmic trading in high frequency.

But generally speaking, yeah, it’s all systems go this week and going into next week’s hike.

What does this mean for gold & silver?

We know that in the end, hike or no hike is good for gold & silver, but assuming “hike” for the 21st FOMC, with what the mainstream sheeple actually believe, we could see increased selling pressure on gold & silver this week.

This is what we call “sell the rumor, buy the news”. In other words, gold and silver will be “sold” into mid next week on the rumor of a Fed rate hike, but once the rate hike passes, gold and silver will then be bought.

That is my working assumption right now. There’s just too many opportunities for the cartel to continue to crush sentiment, even if there isn’t much more downside potential. They never let an opportunity go to waste do they? And they never let price rise until they absolutely have to.

So for now, the cartel is in control.

But I do think that the cartel could even succeed in smashing gold & silver below whole number support because ($1300 & $16) it really is a stacked deck in the cartel’s favor until we get through mid-next week.

There is one saving caveat. If, for some reason, the cartel is not going to hike, the data that comes out would be absolutely horrible, and gold & silver could feed off of the pause/uncertainty.

But with so many opportunities to smash this week, I seriously doubt the cartel will do anything but smash.

Additionally, the smashes will be on auto-pilot with no Fed Head speeches to mess up any market signaling. All the more reason I think we’re going to see continued pressure for the rest of this week and into the rate hike on March 21st.

Finally on the fundamental analysis, It is possible, however, that we see upward price movement in anticipation of all of this.

I cannot discount that, but if in general we’re talking about pricing in the rate hike, gold & silver traditionally would be sold.

Overnight, the dollar wasn’t strong:

Friday it bounced off of the 50-day and it looks to be rolling over.

Interestingly, the dollar was weak overnight, but so were the commodities.

Crude looks to be opening below Friday’s close:

Which is also below crude’s 50-day moving average.

Copper is also looking to open the week below last Friday’s close:

Again, not what you would expect on a weak dollar, but as that old cliche goes: it is what it is.

The gold to silver ratio has barely budged:

Call it either side of 80, which is where we’ve been since the end of January.

Gold is stuck spending more time below its 50-day:

A nasty bearish candle has been forming since the markets opened overnight.

To be forewarned, if the cartel puts pressure on gold all week and into the Fed rate hike, don’t be surprised to see a trip down to the 200-day moving average, which would put gold under whole number support and near $1290.

Yeah, I know, talking $1200s here in March of 2018. The only saving grace will literally save us, and that is, if gold and silver are this cheap and this hated here as we enter the Spring, that’s exactly why I want to be a buyer. It’s both a contrarian and a value play.

Silver also is putting in a bearish engulfing candle:

It’s like I said, with the dollar not strong, this would be counter-intuitive, but obviously, the cartel know that this is the break-out year for the metals, so they’re going to keep them as low for as long as possible. For those already in position, it’s been painful to watch. I mean, at the most primitive of analysis – “inflation” is the word of early 2018 yet silver is down 2.5% on the year. Amazing.

Palladium looks like it’s forming a double-bottom on its correction:

I don’t like the 50-day turning down so let’s hope it actually is just a double-bottom. The technicals show that palladium has a ton of room to run higher, but if gold & silver are getting pressured this week, it’s possible palladium paints a lower-low on the chart.

We’ll cross that bridge if and when we get to it.

Platinum is trying to stay above its 200-day:

But again, notice the theme: The dollar has been weak overnight, but so have the commodities and so have the precious metals.

Of course, playing into this is the VIX which looks like it will gap lower into the open:

My 10-handle VIX call is not looking all that ridiculous after-all.

The yield on the 10-year is still in that sideways channel:

If the Fed is raising next week, we should see the yield on the 10-year breaking out towards and then above the dreaded 3.0% level. So late next week should be very interesting, and if the break-out happens this week, then we could see some fireworks in the markets as well.

For now, however, let’s not get our hopes up. The break-out is coming, and I have been wrong for the last couple of weeks after nailing several calls in a row.

So let’s hope I’m wrong again, because I’m looking for continued pressure into mid-next week. Fundamentally I think we’ll see a “sell the rumor, buy the news”, and that means we could lose whole number support, both for gold & silver.

Let’s hope I’m wrong, because that would mean the break-out came in anticipation of next week.

Time will tell.

Stack accordingly…

– Half Dollar has been on the leading edge of Gold News and Silver News Since 2011. Each month, more than 250,000 investors visit to gain insights on Precious Metals News as well as to stay up-to-date on World News impacting the metals markets.

Stock Market Selloff Showed Gold Can Reduce Portfolio Risk

Mon, 03/12/2018 - 08:33

Stock Market Selloff Showed Gold Can Reduce Portfolio Risk 

– Recent stock market selloff showed gold can deliver returns and reduce portfolio risk
– Gold’s performance during stock market selloff was consistent with historical behaviour
– Gold up nearly 10% in last year but performance during recent selloff was short-lived
– The stronger the market pullback, the stronger gold’s rally
– WGC: ‘a good time for investors to consider including or adding gold as a strategic component to their portfolios.’
– Gold remains one of the best assets outperforming treasuries and corporate bonds

A recent World Gold Council (WGC) study has concluded that the market selloff on February 5th made the case for gold as both a diversifier and an asset that protects portfolios during market downturns.

The stock market selloff of early February saw stocks tumble. But, whilst it was sharp it was also short-lived. Many watching the gold price were disappointed to see gold lose around 0.8% of its USD price between February 5th and February 12th, when both the Dow Jones and European stocks and begun to recover losses.

Yet to judge gold on its price performance alone is to misunderstand gold (or, in fact any asset’s) role in a portfolio. In order to appreciate it’s performance one must compare it to other assets as well as it’s long-term behaviour.

Gold’s protection was stronger than you realise

Whilst gold did drop by nearly 1% in USD terms it was a different story for other currencies (which account for 90% of gold demand). This was particularly the case in Europe where currencies weakened against the dollar, increasing gold prices. In euro terms old rallied by 0.9% and 1.8% in sterling, between Friday February 2nd and Monday February 12th.

Click here to read full story on

[KR1199] Keiser Report: Boycott Rope with which Voters Hanging Themselves

Sat, 03/10/2018 - 11:53

In this episode of the Keiser Report, Max and Stacy discuss the boycott rope with which hyper-partisan-consumer-capitalist voters are hanging themselves. From YouTube to Delta, voters from the other political team are being deplatformed or demonetised after social media hysteria driven campaigns to silence certain voices. In the second half, Max continues his interview with Wolf Richter of about financial, property and retail markets and the economy in the age of Trump.

Forget “Free Trade”–It’s All About Capital Flows

Sat, 03/10/2018 - 11:26

Defenders and critics of “free trade” and globalization tend to present the issue as either/or: it’s inherently good or bad. In the real world, it’s not that simple. The confusion starts with defining free trade (and by extension, globalization).

In the classical definition of free trade espoused by 18th century British economist David Ricardo, trade is generally thought of as goods being shipped from one nation to another to take advantage of what Ricardo termed comparative advantage: nations would benefit by exporting whatever they produced efficiently and importing what they did not produce efficiently. While Ricardo’s concept of free trade is intuitively appealing because it is win-win for importer and exporter, it doesn’t describe the consequences of the mobility of capital. Capital–cash, credit, tools and the intangible capital of expertise–moves freely around the globe seeking the highest possible return, pursuing the prime directive of capital: expand or die.

Capital that fails to expand will stagnate or shrink. If the contraction continues unchecked, the capital eventually vanishes.

The mobility of capital radically alters the simplistic 18th century view of free trade.

 In today’s world, trade can not be coherently measured as goods moving between nations, because capital from the importing nation owns the productive assets in the exporting nation. If Apple owns a factory (or joint venture) in China and collects virtually all the profits from the iGadgets produced there, this reality cannot be captured by the models of simple trade described by Ricardo.

In today’s globalized version of “free trade,” mobile capital can arbitrage labor, currencies, interest rates, regulatory burdens and political favors by shifting between nations and assets. Trying to account for trade in the 18th century manner of goods shipped between nations is nonsensical when components come from a number of nations and profits flow not to the nation of origin but to the owners of capital.

This was recently described in a Foreign Affairs article, (Mis)leading Indicators:

If trade numbers more accurately accounted for how products are made, it is possible that the United States would not have any trade deficit at all with China.The problem, in short, is that trade figures are currently calculated based on the assumption that each product has a single country of origin and that the declared value of that product goes to that country.Thus, every time an iPhone or an iPad rolls off the factory floors of Foxconn (Apple’s main contractor in China) and travels to the port of Long Beach, California, it is counted as an import from China, since that is where it undergoes its final “substantial transformation,” which is the criterion the WTO uses to determine which goods to assign to which countries.

Every iPhone that Apple sells in the United States adds roughly $200 to the U.S.-Chinese trade deficit, according to the calculations of three economists who looked at the issue in 2010. That means that by 2013, Apple’s U.S. iPhone sales alone were adding $6-$8 billion to the trade deficit with China every year, if not more.

A more reasonable standard, of course, would recognize that iPhones and iPads do not have a single country of origin. More than a dozen companies from at least five countries supply parts for them. Infineon Technologies, in Germany, makes the wireless chip; Toshiba, in Japan, manufactures the touchscreen; and Broadcom, in the United States, makes the Bluetooth chips that let the devices connect to wireless headsets or keyboards.

Analysts differ over how much of the final price of an iPhone or an iPad should be assigned to what country, but no one disputes that the largest slice should go not to China but to the United States. That intellectual property, along with the marketing, is the largest source of the iPhone’s value.

Taking these facts into account would leave China, the supposed country of origin, with a paltry piece of the pie. Analysts estimate that as little as $10 of the value of every iPhone or iPad actually ends up in the Chinese economy, in the form of income paid directly to Foxconn or other contractors.

In a world dominated by mobile capital, mobile capital is the comparative advantage. Mobile capital can borrow billions of dollars (or equivalent) in one nation at low rates of interest and then use that money to outbid domestic capital for assets in another nation with few sources of credit.

Mobile capital can overwhelm the local political system, buying favors and cutting deals, all with cash borrowed at near-zero interest rates. Mobile capital can buy up and exploit resources and cheap labor until the resource is depleted or competition cuts profit margins. At that point, mobile capital closes the factories, fires the employees and moves on.

Where is the “free trade” in a world in which the comparative advantage is held by mobile capital? And what gives mobile capital its essentially unlimited leverage? Central banks issuing trillions of dollars in nearly-free money to banks and other financial institutions that funnel the free cash to corporations and financiers, who can then roam the world snapping up assets and arbitraging global imbalances with nearly-free money.

There’s nothing remotely “free” about trade based not on Ricardo’s simple concept ofcomparative advantage but on capital flows unleashed by central bank liquidity.

The gains reaped by mobile capital flow to those who control mobile capital: global corporations, financiers and banks. No wonder labor’s share of the economy is stagnating across the globe while corporate profits reach unprecedented heights.


If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via

Women’s Pension Crisis Highlights Dangers To Savers

Fri, 03/09/2018 - 08:11

Women’s Pension Crisis Highlights Dangers To Savers

– International Women’s Day highlights the underreported UK Women’s pension crisis
– 2.66 million affected by UK government’s change to state pension act
– Women’s pension crisis is one of many in the UK, where there is a £710bn deficit for prospective retirees
– Changes by government highlights the counterparty risks pensions are exposed to
– Global problem as pensions gap of developed countries growing by $28B per day
– Savers and investors should look to invest in gold as part of their pensions

Imagine contributing to a pension throughout your working life only to be told that you won’t receive it when you expect to. When you receive this information it comes with just a few years’ notice. There is little time to make alternative pension arrangements. You have a choice: either continue to work until your pension comes in, or live on very little in the meantime.

This is a reality over 2.6 million women in the UK currently face. Those born in the 1950s have been told by the British government that their retirement ages have been increased from 60 to 65 years of age. This change means they will not receive their state pensions when they originally expected to. This is part of a move to bring men and women’s retirements to the same level.

Put that way, this looks to be a good move. Particularly when one considers the demands for women to be treated equally to men. But when a change is made in this way it is about anything but equality.

The decision by the UK government to delay paying pensions to women of a certain birthdate has resulted in one of the biggest pension crises in the UK, yet it is the least reported and discussed.

Pensions crises is something the country is rapidly getting used to. As well as the 2.6 million women affected by the UK’s Pensions Act there are the many thousands of men and women affected by private pension disasters that amount to over £710bn in deficits.

Each of these issues highlight the high exposure pensions have to counterparty risk. Millions of individuals believe they have safely contributed to a retirement pot only for the government to tell them they have to wait even longer for it or that the company they trusted to support their pension has gone bust.

UK’s pension inequality is economic inequality

Yesterday it was International Women’s Day (IWD) and on Sunday many of us around the world will be celebrating Mother’s Day. Both days are there to recognise the achievements and sacrifices of women. IWD is also there to raise attention to the plights of billions of women across the globe. Many are disadvantaged through economic, political, sexual and other means. Campaigns run throughout the year to help them but IWD is a day to really bring the spotlight to them.

Few in the West realise that IWD has an important place in the UK. We still have major problems with sex trafficking, domestic abuse and discrimination against minorities.

One of the least reported areas in the economic discrimination of women. I’m not talking about gender pay gap, the lack of female CEOs or maternity leave. In this specific instance I’m talking about the female pension crisis that has left over a two million women in a huge financial limbo.

Women Against State Pension Inequality (WASPI) explain how this has happened:

The 1995 Conservative Government’s Pension Act included plans to increase women’s SPA (State Pension Age) to 65, the same as men’s. WASPI agrees with equalisation, but does not agree with the unfair way the changes were implemented – with little or no personal notice (1995/2011 Pension Acts), faster than promised (2011 Pension Act), and no time to make alternative plans. Retirement plans have been shattered with devastating consequences.

WASPI has been campaigning for a long-time to have the changes brought in in a more economically viable manner, so that women can afford their retirements or at least have time to make alternative arrangements. They estimate those suffering as a result of the changes could be higher than the 2.6 million reported by the UK government.

In early February 2018 the government rejected WASPI’s proposals for a fairer transition period, claiming it would “represent a loss of over £70bn to the public purse.” This was a burden pensions minister Guy Opperman said he was not prepared to pass onto ‘young people’.

What about the burden of those women who have not been given enough notice regarding their retirement age? i News, spoke to one WASPI campaigner about the hardships now facing many women in their later 50s and early 60s:

“I was 58 when I got a letter saying my state pension age was going up from 65 to 66. It was a shock because I thought I was getting my state pension at 60.” Ms Eachus says some of the women she has helped have been in serious financial hardship, while others had no idea their pension age had risen. “At Christmas, we sent food and toiletry parcels to women in their sixties who are struggling. We shouldn’t have to do that. Women are having to sell their homes. One of the women I spoke to was sleeping on someone’s sofa. Some are too embarrassed to tell their family.”

In a study carried out by former pensions minister Rachel Reeves on the 2011 Act it found out of 416,000 women considered, 80,000 lost up to £8,000 because of the changes in the 2011 Act.  48,000 lost out on as much as £12,000 thanks to their new state pension age. This study did not take into account the Acts of 1995 and 2007 which stripped other 1950s born women of thousands more.

MP Frank Field, in 2006, estimated there were some women who were as much as £40,000 out of pocket, due to the changes. Those who have to continue working to the retirement age are not expected to receive more as a result of their increased economic contribution through National Insurance payments.

Click here to read full story on

Waves Ecosystem Visualised

Fri, 03/09/2018 - 04:58

You are already told about the bright blockchain future that will be arriving very soon, and that future is coming from Waves. With the launch of smart contracts, atomic swaps, voting and DApps, Waves will become the most advanced blockchain ecosystem for businesses, services and communities, providing them with all the benefits of the cutting-edge, constantly evolving technology.

By Gleb Kostarev

Even now Waves offers a wide range of unique opportunities with powerful functionality. You can easily and securely create, send and trade custom blockchain tokens, switch between traditional currencies and cryptocurrencies, significantly boost the effectiveness of your startup or established business and conduct a pre-ICO or ICO.

So what is so special about Waves’ ecosystem? Here are some of the key elements of the Waves ecosystem visualised.

(Click on the image to see the visualisation)

[KR1198] Keiser Report: Tax Cut Struggle

Thu, 03/08/2018 - 22:24

In this episode of the Keiser Report, Max and Stacy discuss the tax cut struggle for Democrats as voter approval for the cuts threatens their chances in the 2018 midterm elections. In the second half, Max interviews Wolf Richter of about markets in denial about an increasingly hawkish Fed.

The Death of Buy and Hold: We’re All Traders Now

Thu, 03/08/2018 - 11:10

The conventional wisdom of financial advisors–to save money and invest it in stocks and bonds “for the long haul”–a “buy and hold” strategy that has functioned as the default setting of financial planning for the past 60 years–may well be disastrously wrong for the next decade.

This “buy and hold” strategy is based on a very large and unspoken assumption: that every asset bubble that pops will be replaced by an even bigger (and therefore more profitable) bubble if we just wait a few years.

The last time this conventional wisdom came into serious question was in the stagflationary 1970s, when stocks and bonds, when adjusted for inflation, lost over 40% of their value. The decade was punctuated by numerous rallies, but each one petered out.

The only way to profit in this sort of market is to trade, i.e. buy the lows and sells the highs. Buy and hold is a disastrously wrongheaded strategy when the underpinnings of the status quo are eroding.

The 36-year bull market in bonds is drawing to a close, as yields are rising even if official inflation is moribund. Buying and holding bonds will guarantee steadily increasing losses as existing bonds lose value as rates rise.

Stocks have risen solely on the back of central bank stimulus, which is now being reduced/ended. In my view, the political blowback of soaring income inequality due to central banks rewarding capital at the expense of labor will place limits on future central bank largesse.

These long-term reversals of trend make everyone a trader, whether they like it or not: buying and holding might work for real-world assets if inflation really gathers steam, but if markets gyrate in the winds of uncertainty, every asset might rise and fall or simply stagnate.

Being a trader simply means selling an asset when it has topped out relative to other asset classes, and shifting the proceeds into assets that have been crushed and are beginning an up-cycle. It sounds so absurdly simple: buy low, sell high. But it’s not that easy to accomplish in the real world.

It takes discipline to buy when others are selling (the low point of any asset cycle) and to sell when when everyone else is confident (and greedy for even more gains).

As a general rule, letting others take the risks required to skim the last 10% of gains is a prudent strategy: take profits when they arise, and don’t assume uptrends of the sort we’ve enjoyed for the past 9 years will last.

As a trader as well as an investor, I’ve learned the hard way that the barriers to successful trading are largely psychological/emotional: we are all too easily swayed by the emotions of greed, fear and group-think.

Buying and holding is a relatively painless strategy in a rising tide that raises all boats. But when markets gyrate up and down, only those able and willing to trade–to take a modest profit and then buy another asset and then sell that when profits arise–will actually prosper in terms of increasing the purchasing power of their holdings.

The final and perhaps most difficult piece of trading is to gain the ability to recognize a decision to buy an asset isn’t working as planned, and to sell the asset for a loss. Nothing is more difficult for humans than admitting to ourselves that we were wrong and a decision isn’t playing out as planned.

Taking a loss is remarkably difficult as well. Modern psychology informs us that the sting of losses is far more potent than the euphoria of reaping gains, and mastery of trading requires the trader to “make all things equal,” to use the Taoist phrase: losses and gains are treated equally.

Like the football quarterback, we can’t dwell on the interception we just threw; we must clear our minds for the next successful throw/completion.

This discipline takes much practice, and most participants in the markets are ill-prepared to acquire the necessary discipline.

Here’s another metaphor: sailing in calm seas and light, steady breezes makes sailing seem easy to the beginner. But when the seas roughen and the wind gusts unpredictably, it doesn’t seem so easy any more.

Everyone who buys or owns any asset from now on –currency, cash, real estate, cryptocurrency tokens, stocks, bonds, options, farmland, copper futures, oil wells, everything–is a trader. Those who don’t understand this may suffer potentially catastrophic losses.

From now on, everything is a trade that might have to be sold to avoid losses.

“Buy and hold” is based on the belief that each popped bubble will be replaced by an even bigger bubble. As I’ve discussed before, there are solid reasons to suspect that there won’t be a fourth bubble after this one finally pops: three bubbles and you’re out.

It’s instructive to refer to a chart of the percentage of household assets invested in the stock market. Buy the dip and buy and hold worked consistently from 1950 until 1969, when the wheels fell off the stock market. (The wheels fell off the bond market a few years later.)

Households kept putting more and more of their assets into the “can’t lose” stock market until the stagflationary losses of the 1970s destroyed their stock portfolios and their belief in buy and hold.

The percentage of household assets invested in stocks fell from almost 40% in 1969 to a mere 13% in 1982, after thirteen years of grinding losses–a process punctuated by numerous sharp rallies, each of which faded.

President Richard Nixon famously observed, “We’re all Keynesians now,” indicating the triumph of Keynesian policies within the political system. Perhaps in a few years someone will mutter “we’re all traders now,” and that utterance will mark the passing of buy and hold as the status quo’s “can’t fail” strategy. 

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via

London Property Sees Brave Bet By Norway As Foxtons Profits Plunge

Thu, 03/08/2018 - 07:26

London Property Sees Brave Bet By Norway As Foxtons Profits Plunge

– Sales in London property market at ‘historic lows’
– 65% fall in pre-tax profits in 2017 to £6.5m reported by London estate agents Foxtons
– Foxtons warns 2018 will ‘remain challenging’ for London property
– Norway’s sovereign wealth fund is backing London’s property market
– RICS: UK property stock hits record low as buyer demand falls
– Own physical gold to hedge falls in physical property

The world’s biggest sovereign state fund is backing the London property market. The news comes at a time when the UK capital’s real estate market is reportedly at ‘historic lows’ with conditions expected to remain challenging.

There is a risk that Norway’s investment decision will end up being famous example of buyer’s remorse. Activity in both the London and UK housing market continues to slow, new buyer enquiries are at an 11-month consecutive low and agreed sales are down for the sixth month.

There appears to be little sign of recovery given Brexit-jitters and the resulting damage from years of rampant inflation that has pushed prices out of the reach of many.

Norway is possibly out on its own when it comes to confidence in the London property market. Foxton’s and the Royal Institute of Chartered Surveyors (Rics) are indicating that not only has the last year been tough but that it is set to continue into 2018.

This makes for a tough situation for those who have little option to be involved in the UK property market or not. Many don’t realise that even if they do not own a property, they are still exposed to the risks involved in a housing crash. A downturn or total collapse of the property market would not just affect homeowners and mortgage providers. It would send major waves through the rest of the economy.

Click here to read full story on

Gold Does Not Fear Interest Rate Hikes

Wed, 03/07/2018 - 07:32

Gold Does Not Fear Interest Rate Hikes

– Gold no longer fears or pays attention to Fed announcements regarding interest rates
– Renewed interest in gold due to inflation fears and concern Fed won’t do enough to control it
– Higher interest rates on horizon will make debt levels unsustainable
– New Fed Chair warns “the US is not on a sustainable fiscal path” and could lead to an “unsustainable” debt load
– Higher interest rates are good for gold as seen in the 1970s and 2000s
– Gold markets aware that central banks are running out of financial weapons to deal with crises

You wouldn’t believe it by looking in the financial news but the price of gold has had a stellar run over the last few years. Since the beginning of the year it is up nearly 10%, contributing to the near 30% rise since early 2016. Most recently it has been thanks to a weaker dollar, but longer-term it is due to the disbelief gold has in central banks.

Many commentators and market observers did not expect gold to rise as it has: the same period included interest rate rises from the Federal Reserve, something once considered to be the gold market’s kryptonite.

But instead of driving the gold price down, US interest rate hikes have had little impact. One of the key factors supporting the gold price is the very same factor that has central bankers spooked – inflation.

Gold investors have realised that whilst interest rate hikes are likely to continue, the factors they are trying to combat (namely inflation) are now so far beyond central bankers’ control that gold remains an attractive safe haven and asset class.

Interest rate hikes are inevitable but gold sees past them

Inflation in the US is on the move — the PPI measured 2.2% in February. That might not seem like much but don’t forget that the markets are not prepared for higher inflation. Consider reactions back in January when it dawned on market participants that inflation could not stay this low forever.

Higher inflation will inevitably mean even more interest rate hikes. Surely this is a good thing? Perhaps, but is it too little too late?

Sadly central bankers seem to one step behind, rather than one step ahead when it comes to monetary policy. As we have seen since the financial crisis struck, central banks are reactors rather than actors when it comes to preventing seismic events.

Those investing in gold recognise that central banks can increase rates as much as they like. But a rapid reaction such as this can lead to dangerous problems for the debt-laden side of the market.

Interest rate increased will see unsustainable levels of debt

“Everything is just very burdened with debt, and there’s no stopping it.” Ron Paul told CNBC this week. He’s not wrong. At the moment there are zero plans in place to reduce the debt burden across the financial world.

What makes the debt so unsustainable? Interest rate hikes.

“We’re gonna see higher interest rates and when that happens then that debt becomes very much unsustainable” Stephen Flood, The Goldnomics Podcast

“the scene is set for higher interest rates, debt burden is going to become difficult to manage and we think that there’s going to be market events that these Treasury officials are going to have to answer for.”Stephen Flood, The Goldnomics Podcast

If central bankers react by increasing rates then it could make interest payments the US government’s largest single expenditure — bigger than Social Security ($916 billion in 2016), defense ($605 billion) or Medicare ($594 billion).

Click here to read full story on

Rabodirect Closing – Gold May Protect If Banks Go “Belly Up Again” – Finucane

Tue, 03/06/2018 - 07:43

– RaboDirect Ireland to close online savings accounts in Irish market on May 16
– RaboDirect holds over €3 billion in deposits from its 90,000 Irish customers
– Irish savers now exposed to still indebted Irish banks and bail-ins
– Marian Finucane heard recently that buying gold is for “ordinary people” and not just for “rich and posh people”
– By owning gold “if banks go belly up again you would be covered” – Finucane
– David Kerr mentions “one of note” GoldCore and GoldSaver
– Depositors with deposits over the government guarantee in the covered institutions are vulnerable and Marian says “after that goodnight, good luck and goodbye”

RaboDirect, the online savings bank, is set to close the deposit accounts of all 90,000 customers by May 16. Rabodirect’s 90,000 depositors have more than €3 billion on deposit with the bank.

Rabobank  is an A+ (S&P) rated Dutch bank and thus Rabodirect had the highest credit rating of any bank in the Irish savings market and thus was the safest savings option in recent years.

The online bank established itself in Ireland in 2005 and grew its deposit base rapidly, especially during the Irish financial crash which saw Irish banks nearly go bankrupt and having to be bailed out by the Irish government.

RaboDirect has begun to inform all customers of the  ‘actions they need to take’ and what they need to do before 16 May. Rabodirect said it wants to make the process as straightforward as possible for customers to close their accounts and transfer their savings securely to other financial institutions.

Click here to read full story on