Saturday 5 October 2013
The central bankers have no rudder, adrift in a sea of fiat, taking
everybody with them. Witness Cyprus and Greece being forced to
walk the plank. Those who choose to stay on this Ship of Fools will
suffer the same fate, even worse as the growing panic emboldens
Unless one has become anesthetized to the proverbial handwriting
on the wall, symptoms are teeming all around. Barack "Yes We
Can" [more than double the debt] Obama told everyone, promised
everyone that he would cut the deficit in half. What he did not say
is cutting it in half would then be the measure by which it would
multiply. Issuing fiat does one thing and one thing only: it robs
everyone of whatever value they have. It is a hidden transfer of
wealth from you to the government, plain and simple.
POMO, [Permanent Open Market Operations], with emphasis on
Permanent, designed to maintain the illusion that stocks are in a healthy bull market, so all must be well...at least for the top 1%; for the rest, not so much. Everything the Federal Reserve does is an
illusion, including its existence, but it has become the financial bully
no one dares to challenge.
One of our favorite lines comes from Leonard Cohen's Anthem,
"There is a crack in everything, that's how the light gets in." For all
those in the Western world mired in the endless debt forced on by
central bankers, silver is part of the light that gets in and provides
Some of the smartest people in the financial world are the
Stackers. Bankers have been doing everything possible to squeeze
the life out of Precious Metals, but those in the PM community
are not in the least bit fooled by fiat money creation. Stackers
understand there is no third-party risk owning the physical metal,
and eventually price will adjust to reflect the massive distortions
created by the Creatures From Jekyll Island.
While there have been projections for silver to reach $100 the oz,
$200, even $300, it really does not matter. Whatever the price, it
will justly reflect all the mishandling of the economy by the central
bankers, and those who own and hold silver, and gold, will reap the
benefits of their foresight learned from hindsight.
The day is coming when central bankers will lose total control, and
the message to them will be clear as sound money is reestablished:
A look at what the charts are saying, in the interim.
The timing for the end of the central banker's world as we
regrettably know it will always be in doubt. Time weighs more
against the Masters of Fiat than it has been in their favor for the
brief time since the April 2011 highs. The fact that price rallied to
$50 is evidence that bankers are on the losing end of this battle,
and the correction that has been overly exaggerated to the
downside is but a temporary respite, their own illusion of "victory"
that is massively failing.
The gap breakout to the upside was seen as important when it
happened, as we said at the time, [here, 4th chart]. The lower
time frames show more important detail.
What appears to be more positive about how silver has been
developing in its current TR, [Trading Range], is the fact that it
is developing on top of the last TR. The upside breakout gap in August was just successfully retested in another attempt to push
silver lower, yet price is showing some resiliency. The rally of the
last 3 TDs has upper range closes shows buyers won the battle,
but the decline in volume indicates it was a result more from a lack
The failed probe lower, as it occurred further along the RHS, [Right
Hand Side], of the TR also adds to the positive aspect of the its
development. What we need to see from here is a test of the failed probe. The last 3 TDs may be that retest, and if so, what is also needed is a strong wide range rally on increased volume above
The 90 minute chart shows a D/S bar, [Demand over Supply], which often acts as support, and price has held the lower level of that
bar. There was a smaller S/D bar on 1 October, and it led to the
recent failed probe. It is possible it is a probe to see if there were
any appetite to take price lower. The fact that the gap held
In the long run, silver is going higher, much, much higher. In the
short run, anything can happen, but silver's ability to withstand
selling assaults is growing. Getting long a proven retest of last
week's low makes sense.