Tuesday, November 8, 2011

The Doc Goes on an All-Out RANT

The title of this post originally was US Mint Silver Eagle Sales Slow in November, but as I wrote this it rapidly devolved from an update on US Mint statistics to an all-out rant on the current state of affairs of our fiat/ponzi system. 

After a torrid September and early October, the pace of US Mint sales of US Silver Eagles has slowed of late.
After selling nearly 3/4 Million silver eagles on the first day of October alone, the US Mint sold a total of 376,000 for the entire first week of November, on pace for a monthly total of 1.57 million ounces, easily the lowest monthly total of 2011.  Signs of slowing demand have also been seen in decreasing premiums- several major online dealers have offered silver Maples for $2.25/oz over spot in the past week.
As silver has slowly been grinding its way higher over the past month, we think the slow-down in demand is temporary- thanks to a lack of sex appeal.  When silver is smashed lower, value investors pile into the phyzz and scoop up all available supply.  When silver breaks out, the excitement of the rally and the fear of "missing out" cause the Average Joe to pile in.  Right now we have neither in silver.  The current $35 level is 35% above the recent lows of $26, yet still $15 off the May highs near $50- making silver feel emotionally like it is in no-man's land- even though it has gained over 75% in the past 12 months.

Silver's investment demand will still set an all-time record for 2011, and we are not concerned in the least about the temporary slow-down.  The factors that have driven silver from $4 to $50 over the past decade have not changed in the slightest, and are actually intensifying daily. 

*US official public debt has now passed $15 Trillion and is now roughly equal to 100% of GDP.
*Greece has effectively defaulted with Italy, Portugal and Spain close on its heels leaving a euro-breakup imminent.
*The markets are being prepared verbally for QE3 by the Fed governors, even while QE light and The Twist continue.
*Commodities investors are now scared-to-death of leaving their funds in a broker-dealer account due to the theft of $1.5 Billion of client funds by MF Global (and confiscation by JP Morgan).  If client funds can be comingled with institution funds at MF Global, they can (using client funds for internal repo agreements is standard industry practice as Jon Corzine advised the CFTC's Bart Chilton)
*The state and muni default tsunami is rapidly approaching.
*The $1.25 Quadrillion derivative bubble is still growing daily (and may not actually pay out in the event your neighbor's house burns down as the Greek 'non-default' default has demonstrated).
*The official unemployment rate remains over 9% (with the real rate remaining near 20%).
*Venezuela has called in the gold- physically removed their gold from Western Central Banks which had leased it to Wall Street banks which had in turn dumped it on the market
*The Occupy Wall Street movement has gone nationwide- if OWS can survive the Winter look for the first real violence to erupt in the spring.
*The laughable official CPI is in the process of being debauched further in an attempt to disguise rampant price inflation to the ignorant general public
*Libya has been invaded and overthrown over plans to develop a gold backed dinar and sell Libyan oil for gold rather than US dollars.
*Registered COMEX silver supplies remain near all-time lows
*The CFTC has finally approved position limits in commodities...including silver
*The US dollar remains major bear market.
*The general public is still so far from entering gold and silver that labeling either a bubble is BLATANT DISinformation

Are you getting the picture? 

NOTHING HAS CHANGED.  The fundamentals for owning precious metals only get stronger daily.  There are literally DOZENS of more reasons to own gold and silver today than when we first entered the bull market in 1999.
Only PHYSICAL, IN HAND GOLD & SILVER can fully protect you from continuing currency devaluation, much less the potential end game of complete debt/fiat collapse.