Wednesday, May 18, 2011

How To Read The News

Most people blindly and dutifully read major newspapers on a daily basis.  Many country club conversations start out, "Did you see in the Wall Street Journal that Goldman Sachs thinks gold is in a bubble?"  As we have discussed previously, that headline would mean that the Goldman Sachs prop desk is presently buying gold.  They are hoping that you will call your Merrill Lynch broker after that conversation.  Once on the phone you ask him what he thinks because he is an expert.  He says, "We have a very interesting research report out for our private client division that details how George Soros is selling his gold and several noteworthy economists that have never held a real job in the investment world all think owning gold is a bad idea."  After you sell yours and buy that municipal bond fund that he makes extra commission on be assured that the selling is over and the real rally begins.  Your ignorance has determined your victim status in that news cycle.

There are only five sources of news in America today.  Those five get their news from Reuters which owns the Associated Press.  The owners of the major news distribution services are in an elite fraternity and there is always a power struggle within that group.  This statement is labeled a conspiracy theory and is prosecutable in some jurisdictions. 

Americans remain the only group of people in the world that believe politicians are here to help, journalists are working hard to get the real story and their stock broker will help them make money.

As time passes and the conspiracy theorists are locked up or silenced true history is accepted.  People forget or don't want to remember.  When Rockefeller and Morgan were neck deep in WWI war bonds and in danger of a default if the British fell to German might, they pleaded with Wilson to get US soldiers involved.  Wilson was re-elected on a platform centered on staying out of foreign conflicts.  Bottom line, Americans had to die in order to get the public behind the war.  The Lusitania ferried passengers from America to Britain and they began stuffing 50% of the ship with military supplies to support our ally.  The Germans issued a press release and sent it to all newspapers in the northeast with specific notice that this passenger ship would be treated as a war vessel .
JP Morgan had purchased many of the papers in the Northeast and this notice was kept from those readers.  When the newspaper owner is one of the largest creditors in the conflict, he has incentive to keep news from the people.

The death of JP Morgan revealed that he only controlled 33% of the firm bearing his name.  The Rothschild banking dynasty controlled the balance.  Guess who owns Reuters?  But you can't believe that can you?  It must be a conspiracy theory right?  Notice how you will blindly believe anything written by the Associated Press never questioning it.

In order to survive and protect your capital you must do three things when reading the news:

  • Follow the money
  • Ask who would benefit from this?
  • Use common sense
Today's headlines are covered with articles about Dominique Strauss-Kahn and his alleged rape indecent.  We will attempt to break this down for you, not in an effort to solve the case but merely to keep our bearings straight and possibly see another mile-marker for the gold bull market.

Leaders of the IMF have diplomatic immunity and this was waived by the board immediately following the alleged incident.  Most Americans would say that is justified due to the nature of the charge but this is far from correct.  Bureaucrats who are properly following instructions from the bankers they serve can get away with murder, and many have done exactly that.  Mysterious heart attacks, cars running off the road, dying in their sleep, are all accepted headlines in papers.  Remember, Hinckley shot Reagan to impress Jodi Foster... you actually believed that one, so it is confirmed that you will believe anything unless you rethink the way you read the news.

We know that DSK has presided over a period where the IMF has grown faster than a technology company in 1999 taking full advantage of the financial crisis.  They have also begun issuing Special Drawing Rights which many believe will be the basis for a new world reserve currency.  The dollar is losing status in that realm and some countries have begun settling commodity trades in their native currencies which represents the first domino in our opinion.  Please take time to familiarize yourself with the actual purpose of the IMF as a Trojan Horse for private banking interests.  This organization has effectively enslaved millions of innocent citizens unknowingly born on resource rich soil, controlled by bribe-able dictators who are more than willing to accept loans that barely stand up to pawn shop standards.

Someone wanted DSK out of office.  Was it the French?  He was gunning for president of France and some felt he had a shot.  Was it American interests?  He is being replaced by a former JP Morgan employee which we are certain is only a coincidence.  Whoever is giving orders that DSK was not following surely has replacement John Lipsky's attention.  What if we told you that it doesn't matter who is behind this "hit?"  Our thesis on gold is only more certain as we study these events objectively.  Someone is gunning for increased control of the IMF.  This means we are closer than many realize to a new reserve currency.  

This leads into our investment update.  June 13th remains a critical date identified by Armstrong as a marker signalling the beginning of a new cycle.  These cycles run in 8.6 year terms.  The first 4.3 years will be the most shocking for people but the middle marks the crest of the wave.  The mass never accepts the cycle until the wave crests then ineffectively chases the trend down the back side of the wave.  This next cycle will be characterized by systemic failure of public debt vehicles and loss of faith and utility in sovereign currency.  This must happen as there is no way to get the situation under control without a crisis.  

With QE3 and beyond being debated, an arbitrary debt ceiling limit breach, ongoing annual fiscal deficits larger than the entire public debt in 1980, real jobless rates over 20%, struggling local governments clamping down on fees & fines, limited access to credit, slow or no business growth, massive under-utilized property inventories and over 20% of the country receiving entitlements we have plenty of catalysts to kick off this next phase.  An oligarchy controls this country and the politicians serve at their behest.  As this next phase gets underway there will be a desperate attempt to blame and retain power.  Citizens should be aware of this and prepare accordingly.  Staying out of the limelight is suggested (Why are we writing this blog?).  

Gold and silver should be held at this time.  We have recommended an allocation mixing physical metal, large miners and small juniors.  Based on emails received we don't believe you have taken our advice and will shortly be blaming us for your frustrations.  

Gold will grind in a range of $200 centered on a current spot price of $1,498.  As a reminder this is more than 22% higher than the spot price of one year ago today so if you are in a triple leveraged futures trade and experiencing frustration you might consider our proven allocation which allows for sound sleep.  Gold will eclipse $2,000 an ounce before 11-15-11 and close the year between $1,750-1,825/oz.  Prospect generators in safe territories will be "buys of a lifetime" this summer for objective investors in balanced mental states.

Silver is preforming perfectly.  An extreme rise followed by a healthy correction now leaves us happily grinding in a range of $28.25-$39.00/oz through the summer.  Again, todays spot price of $34.91/oz is a full  83% higher than that of one year ago.  We really can't ask for anything more.  Just when we thought it could not get any better, it appears no one wants our silver miners!  It appears no one showed up to take advantage of the sale so we have free reign of the store.  Silver will consolidate until a new base is sufficiently formed at which time $50/oz will be passed with ease and $60/oz will be the first stopping point.  This could happen before the end of 2011 but the base building must continue for some time.  Eight margin hikes really take a toll on a specific commodity market.  This metal is close to trading in a cash market.

Sunday, May 15, 2011

Uranium Market Fundamentals

Please see our detailed opinion with respect to the fundamentals of the uranium market.

http://www.traderslog.com/uranium-market-fundamentals/

A list of preferred positions in the sector along with a recommended allocation is available for purchase.

Contact KSIR Capital on the link to the right of this post.