- Elitist fool tells us peasants “don’t hoard”
- Nightmare scenario: Social media mobs raiding your pantry?
- Feb. 26, 2022: As momentous as Nixon closing the gold window
- Saudi Arabia looks to price oil in yuan (uh-oh)
- The trading strategy spotlighted by Tom Brady’s un-retirement
- Russia sanctions translate to platinum supply squeeze… How Moscow can fight back against sanctions (continued)… Putin as an 11-dimensional chess player?… and more!
[Before we start the clock today: We’ve had an overwhelming response to the rollout of Jim Rickards’ presentation revealing “the weird pattern that’s preceded every market crash since 1919.”
We implore you: Events will begin moving very quickly tomorrow afternoon. That’s when the Federal Reserve begins putting this pattern into motion, raising interest rates for the first time in the pandemic era. Watch now — while there’s still time to act.]
The power elite has put you on notice…
“World Bank President David Malpass on Monday warned people and businesses against hoarding food and gasoline,” reports the Reuters newswire — “despite the surge in prices sparked by Russia’s invasion of Ukraine and massive sanctions imposed on Moscow.”
Said Malpass at an online event hosted by The Washington Post: “The right thing to do in these current circumstances is not to go out and buy extra flour or extra gasoline, it’s to recognize that the world is a dynamic global economy and will respond. There’ll be enough to go around.”
He elaborated on that last remark by saying — as Reuters paraphrased — “based on current assessments, he does not anticipate the crisis ending the global recovery and reducing global GDP.”
The corporate media won’t tell you, so it’s up to us: Malpass made a jackass of himself the last time he issued a major prediction of that nature.
In August 2007, Malpass was chief economist at Bear Stearns — and he totally blew off the onset of the global financial crisis.
Here’s what he wrote in a Wall Street Journal Op-Ed: “Housing and debt markets are not that big a part of the U.S. economy, or of job creation… the housing- and debt-market corrections will probably add to the length of the U.S. economic expansion.”
Four months later, the “Great Recession” was underway. Three months after that, in March 2008, the trouble in housing and debt markets took down the very investment bank that paid him to make such stupendously awful calls.
Naturally, Malpass failed upward. Donald Trump named him a senior economic adviser during the 2016 campaign, and then appointed him to a top job in the Treasury Department and finally tapped him for his current gig in 2019.
The only logical reaction to Malpass’ no-hoarding warning: “You can do nothing as you’re told… or prepare accordingly,” tweets the financial blogger and chart hound Philip Calrissian.
Just beware that preparing accordingly might come with its own consequences: The independent journalist Michael Yon spins a harrowing scenario a few months hence …
“The Dictator of the United States says, ‘Nobody can be blamed for wishing to feed themselves. Your food is gone because conservatives took it! The rich people took it! Go to their pantries and claim what they have stolen.’
“And a state dictator, previously called governor, echoes, having safeguarded his family, echoes the words of the Dictator, ‘Nobody will be prosecuted for starving! Take that which is your right!’
“And the social media billionaires echo and post specific targeting information. They know who has been naughty and nice. And they send messages to phones and machines of violent criminals saying where the loot is.”
Far-fetched? Perhaps. But there’s a lot that seemed far-fetched in 2019 that’s come to pass.
Then again… maybe Malpass’ intended audience isn’t domestic?
A good point there from Luke Gromen, head of the independent research service called Forest For the Trees.
It was on Saturday, Feb. 26, that the United States and the European Union froze as much as 60% of Russia’s foreign-exchange reserves — as we’ve said before, an unprecedented act of economic warfare.
Mr. Gromen says the date will prove to be as momentous in financial history as Aug. 15, 1971 — the date Richard Nixon cut the dollar’s last tie to gold.
In the last two weeks, central banks worldwide have been looking around and wondering whether they might be next. If the dollars they hold can be rendered zeroes by the U.S. president’s stroke of a pen… why wouldn’t they convert their dollars to food and oil? Or gold, for that matter? Really, anything tangible.
The Biden administration is “destroying the value of the dollar by abusing sanctions,” affirms our own Jim Rickards.
But we’re getting ahead of ourselves. We’ll take time to explore that angle with Jim tomorrow.
In the meantime, Russia is not exactly helpless: “Russia has banned commodity exports to any nation that has sanctioned Russia,” says Jim. “This is where the law of unintended consequences comes into play.
“Over 65% of the processed neon gas used to power lasers that make semiconductors work comes from Odessa, Ukraine. Between 35% and 50% of strategic metals such as titanium, and aluminum used in aircraft manufacture by Boeing and Airbus, comes from Russia. Much of the grain that feeds the Middle East and Africa comes either from Ukraine or Russia. Russia also exports metals used in battery production for EVs including lithium, cobalt and nickel.
“The list goes on topped by oil, natural gas and coal where Russia is the leading supplier to Europe.
“If Russia follows through, we could be looking at a shutdown of major industries around the world from semiconductors (essential for automobiles, appliances, electronics, etc.) to heavy equipment and transportation.
To the markets — where the noise is about falling oil prices but the real news is about Saudi Arabia possibly ditching the dollar to price its oil.
“Saudi Arabia is in active talks with Beijing to price some of its oil sales to China in yuan,” says The Wall Street Journal — “a move that would dent the U.S. dollar’s dominance of the global petroleum market.”
Hey, the House of Saud can see what happened to Russia as easily as anyone, right?
But that’s not what’s moving the oil price today. No, it’s all short-term noise about China expanding its latest COVID lockdowns — Toyota and Volkswagen are shutting down operations in Jilin province — and how that will put a damper on global oil demand.
With that, a barrel of West Texas Intermediate has tumbled below $95 for the first time since Feb. 25 — a day after Russia invaded Ukraine.
Stocks are rallying — the Dow back above 33,000 and the S&P 500 back above 4,200. The Nasdaq is up strongest among the major averages, but it still has work to do before reclaiming the 13,000 level.
The major cryptos sit more or less where they did 24 hours ago, Bitcoin at $39,130 and Ethereum at $2,572. Precious metals are getting slammed again — gold down to $1,917 and silver to $24.76.
Meanwhile, a supply squeeze is shaping up in the platinum group metals.
Russia is one of the globe’s major producers of platinum and palladium, followed by South Africa.
The head of South Africa’s biggest mining company says there’s no way his country can make up the difference. “Acceleration of projects to expand production is possible, but a significant increase in production will take months and even years,” Sibanye-Stillwater CEO Neil Froneman tells the state broadcaster SABC.
The platinum group metals are essential to the catalytic converters in every vehicle powered by an internal-combustion engine. Bad news for the auto industry — although maybe it’s offset by the further bad news of vehicle production shutting down again in China? Helluva time we live in…
Despite the supply squeeze, both platinum and palladium are subject to the same sort of paper-trading manipulations that can jerk around gold and silver prices. Platinum trades this morning at $989 an ounce and palladium at $2,360 — both of them down big from their peaks a week ago.
We don’t often look to gambling as a model for successful investing or trading… but our trading guru Alan Knuckman alerts us to something interesting that went down before NFL superstar Tom Brady announced he was coming out of retirement after all of six weeks.
“On Thursday, while bookmakers and bettors were focused on college basketball tournaments, big wagers on the Tampa Bay Buccaneers to win the Super Bowl showed up at multiple Las Vegas sportsbooks,” writes ESPN’s David Purdum.
“Tampa Bay was around a 50-to-1 long shot when bets upward of $10,000 came in Thursday at the SuperBook, South Point and Circa Sports. Bookmakers drastically adjusted their odds, while trying to determine what was behind the flurry of interest in the Buccaneers.”
The “what” was Brady’s impending announcement he would return to the Bucs — which came Sunday evening.
Somebody knew something.
“Follow the money,” Alan says. Which is the premise of our options trading service The Profit Wire. Using a proprietary indicator called QIT-4, it tracks unusual activity in the derivatives markets — comparable to the Vegas sportsbook activity a few days ago — that can serve up uniquely profitable opportunities.
We’ll reopen The Profit Wire to new members later this spring. Watch this space…
“Quick thought on all of the Western ‘leadership’ and talking heads telling us about Putin acting ‘differently’ maybe on the way to some sort of psychosis,” a reader writes.
“The guy, as evil as they come, is a savvy shark in a sea of manatees playing them like a fiddle and eating only a part of them; that’s what Trump was getting at in his comments.
“It’s taken a bit longer to get the pawns lined up, but he will end up with his four-bagger. With the CCP backing him in the international banking world, the Western fools are pitiful and embarrassing. In a couple of weeks, they can start drinking Stoli again.”
The 5: Despite all the contempt we hold for Biden, Trudeau, Johnson, Macron, Scholz and the rest of the Western leaders who purport to uphold the “liberal international order”… we’re not swayed by the argument that Putin is some sort of strategic genius playing 11-dimensional chess.
We’ll go further, as long as you’ve wound us up here: As much as it seems the freezing of the Russian central bank’s dollar assets marks the beginning of the end for the dollar’s reserve-currency status… we hesitate to predict it’s the end of American empire as we know it, much as we might wish America would return to being “a normal country in a normal time.”
We’re sure there were people in first-century Rome who looked around and pondered the horrendous rules of Caligula, Claudius and Nero… and the Year of the Four Emperors… and thought to themselves, This can’t possibly last.
But it did. The Year of the Four Emperors came in 68–69. It wasn’t until 117 under Trajan that Rome achieved its maximum territorial reach… and the (Western) empire hung in there for another 350 years or so.
Just something to keep in mind. Along with the line attributed to Bismarck about God having special providence for fools, drunkards and the United States of America…
Best regards,
Dave Gonigam
The 5 Min. Forecast
P.S. By the time you read this, the Federal Reserve will be less than 24 hours away from setting the next market crash into motion.
That’s Jim Rickards’ shocking conclusion based on the near-certain outcome of the Fed’s March meeting tomorrow… and a history of market crashes going back almost as long as the Fed’s formation in 1913.
It won’t happen instantly, but Jim says it’s baked into the cake…
- A massive wave of defaults across the U.S. banking system
- A plunge in the Dow of as much as 80% in only weeks (Jim’s not the only one predicting this — for instance, there’s Michael Burry, who made a fortune predicting the 2008 crash that David Malpass never saw coming)
- The destruction of millions of Americans’ retirement dreams.
Again, the Fed sets this dirty snowball rolling downhill tomorrow at 2:00 p.m. EST. Click here and make sure you heed Jim’s warning before then.
“Russia may be the first victim of U.S. sanctions. But the entire world will pay the final price.”
And as if that’s not enough to worry about, the Federal Reserve’s Open Market Committee begins two days of meetings today.
When they wrap up tomorrow at 2:00 p.m. EDT, it’s all but certain they’ll begin jacking up short-term interest rates — and launching a process Jim says will trigger the next market crash.
How can he be so certain? Well, nothing less than a century of financial history — including a chart pattern that’s foreshadowed every market crash since 1919. Be sure to watch Jim’s exposé now — before the Fed makes its fateful move.
