Money Flow Trading Method along with Risk Management

https://moneymaven.io/mishtalk/econo...UWnqHnw970T3A/

Tip of the Iceberg
The emergency repo auctions to get through the quarter end on September 30 have been extended and added to.


Today, the Fed announced it would add roughly $60 billion a month through the end of the second quarter of 2020.


Please consider the Repo Market Incident May Be The Tip Of The Iceberg by Daniel Lacalle.


The Federal Reserve has injected $278 billion into the securities repurchase market for the first time. Numerous justifications have been provided to explain why this has happened and, more importantly, why it lasted for various days.


The first explanation was quite simplistic: an unexpected tax payment. This made no sense. If there is ample liquidity and investors are happy to take financing positions at negative rates all over the world, the abrupt rise in repo rates would simply vanish in a few hours.


Sudden bursts in the repo lending market are not unusual. What is unusual is that it takes days to normalize and even more unusual to see that the Federal Reserve needs to inject hundreds of billions in a few days to offset the unstoppable rise in short-term rates.


What the Repo Market Crisis shows us is that liquidity is substantially lower than what the Federal Reserve believes, that fear of contagion and rising risk are evident in the weakest link of the financial repression machine (the overnight market) and, more importantly, that liquidity providers probably have significantly more leverage than many expected.


In summary, the ongoing -and likely to return- burst in the repo market is telling us that risk and debt accumulation are much higher than estimated. Central banks believed they could create a Tsunami of liquidity and manage the waves. However, like those children’s toys where you press one block and another one rises, the repo market is showing us a symptom of debt saturation and massive risk accumulation.


QE is Back

Lacalle notes Quantitative Easing Is Back

The Federal Reserve, through its president Jerome Powell, has indicated that it is preparing to increase its balance “organically”. The effort to separate this latest monetary policy change of course from a full-blown new QE (quantitative easing) is, at the very least, amusing. If we look at what is being discussed, it has nothing to do with organic expansion and looks a lot like a new repurchase program.


What the Fed proposes has very little to do with organic expansion. The Quantitative Easing programs repurchased between 60 to 85 billion dollars in assets per month. If we look at the organic growth of the Federal Reserve balance sheet prior to quantitative easing, it barely reached 3 billion dollars in a month. The Federal Reserve is discussing between 200 and 300 billion per quarter.

That is not organic expansion but it is neither the type of measure that would trigger a surge in risk appetite from financial agents. So it is quite a lot more than organic expansion and also a lot less than what beta-chasing investors may require to keep their negative dollar carry-trade on cyclical assets.


This is a measure that will not satisfy those who need more excess liquidity and more stimuli to continue playing against the dollar but, at the same time, it further distances the Federal Reserve from normalization. If we assume the figures mentioned in different sources, the Federal Reserve balance sheet is unlikely to go below 25% of GDP in the next years.


The average investor may find contradictory messages in the Fed statements. Powell confirms that the economy is growing at a good pace, that unemployment is at the lowest level in 50 years and that core inflation remains above the Federal Reserve threshold, yet they also tell us that they have to cut rates and expand the balance sheet. Something does not match, and the explanation may lie in the need to keep an excessively leveraged market afloat and prevent the chain of bubbles in financial assets from bursting.


To me, these apparent contradictions in communication mean that the Federal Reserve is looking to prevent a financial asset meltdown while at the same time trying to avoid a higher concentration of risk. It may be, again, trying to manage the waves in the tsunami.


Supposedly Not QE, Not Monetary Policy

The Fed says these injections are not QE and not related to monetary policy.

Both statements are lies.


I commented on repos a few days ago in Fed Seeks Firm Grip On Interest Rates, Supposedly Not QE.

How the heck can operations needed to control interest rates not be considered monetary policy?

Mike "Mish" Shedlock

Quick Summary: First Trade - September 10, 2019

40 Forex Trades - 40 Forex winning trades

September 10, 2019 to October 11, 2019 = 32 days

Total Net Profit - Closed Trades - $16,522.60 US Dollars

One open Forex Trade - Long Silver 2500 Ounces - Draw down - $144.98 US Dollars

https://steemit.com/investing/@webbo...f-distractions

Gold is still being hammered during London’s trading period; we think it’s to keep everyone’s mind off all the printing that’s going on that’s collapsing the value of the US Dollar (more to come later). Gold is now trading at $1,486.00, down $15 and right by the low at $1,485.30 with the far away high at $1,508.00. Silver is being brought to bear as well with its trade at $17.44, down 16.2 cents and right by its London low of $17.42 with the high at $17.785. Now we look at the US Dollar’s value with the trade at 98.015, down 39.6 points and recovering from a low of 97.92 with the high at 98.450. Of course, all this happened before 5 am pst, the Comex open, and the London close.


In Venezuela, Gold is now valued at 14,841.43 Bolivar proving a loss of 272.65 Bolivar with Silver at 174.182 dropping 3.546 in Bolivar value. Argentina’s Peso now has Gold valued at 86,060.89 showing a 1,316.55 A-Peso drop in value with Silver continuing lower at 1,009.90 reducing the money of the people’s value some 17.66 Pesos. Over in Turkey, where the problems are many, Gold’s trade under the Lira is now at 8,701.39 Lira taking out more than double yesterday’s gains proving a loss of 215.12 in value with Silver now at 102.106 T-Lira, showing a reduction of 2.743 Lira overnight.

October Silver Deliveries now show a demand count of 337 fully paid for contracts waiting for receipts and for some reason not getting them filled showing a reduction of 2 from yesterday’s tally and with a Volume of 2 up on the board yesterday. So, once again, is this part of a spread exit or where there 2 more purchases and 4 receipts getting delivered? As of this morning, we have another 2 lot on the Volume side of the ledger and with a trading range between $17.595 and $17.40 with the last price being the low so far.

Silver’s Overall Open Interest dropped some more with the total count now at 210,209 Overnighters, proving a drop of 2,351 more positions in trade. So, the overall count continues to slowly drop at the same time the game we’ve all been forced to observe continues until it can no longer do so. We’re not too concerned that the print of money is at full retard, showing the value of our currency dropping 1.29 basis points (percentage as well) since Oct 1st. But what might be of interest is Gold has remained solid price-wise and with a slight gain for Silver since the beginning of the month.

Monday is the day we start the new Yuan to Gold trade with the CMEGroup adding the Chinese Yuan price to Gold’s mini contracts alongside the US Dollar’s trade. I’m not sure why this is being allowed since we here in the United States use the US Dollar? The one question I have is; what’s to stop a Chinese citizen from selling his Gold in China and buying it over here and taking delivery, removing their wealth from the Chinese authority’s control mechanism? How about the reverse of that question or maybe instead of an individual, what about their government? With China being the other side of a whole list of unfair trading disputes with the USA, can this cross currency to a precious metal be used as a weapon? Can the president stop this from happening if China refuses to protect the creativity of our nations inventors and manufacturers, which they have had a free hand at stealing our ideas for oh so long now?


Here’s something I really enjoyed hearing during yesterday’s communicate, Trump's New Executive Orders To Restrain the Administrative State Federal agencies (that) evade the rulemaking process, yet still levy fines, revoke permits, and seize property via “guidance.” Not much is said about how far up the chain this will go, but with my optimism levels at a high, my question is; can we now go after the SEC and the CFTC for ignoring all the evidence that is being brought out against JPMorgan by the DOJ in not only manipulating our precious metals, but all the refiners and mining companies shares as well? I for one would love to see this happen, and will remain optimistic that truth and fairness will continue to move forward.


This is why we hold on tight to physical precious metals. The currencies are being hyper-printed at the same time the commotions behind the front-page BS is screaming massive problems within the banking sector. Can anyone say “Deutsche Bank is the problem” in the central’s upper levels? Hello!! Have a great weekend folks! All this daily activity is a simply a distracting show, until those that do not follow the money print finally see what we’ve been addressing for oh so long now. Keep the attitude positive, have a smile on your face no matter what! And as always …

Stay Strong!

J. Johnson

https://www.zerohedge.com/economics/...8VkZBd7paVALVA

Authored by Alasdair Macleod via GoldMoney.com,


This article posits that there is an unpleasant conjunction of events beginning to undermine government finances in advanced nations. They combine the arrival of a long-term trend of rising welfare commitments with an increasing certainty of a global-scale credit crisis, in turn the outcome of a combination of the peak of the credit cycle and increasing trade protectionism. We see the latter already undermining the global economy, catching both governments and investors unexpectedly.


Few observers seem aware that an economic and systemic crisis will occur at a time when government finances are already precarious. However, the consequences are unthinkable for the authorities, and for this reason it is certain such a downturn will lead to a substantial increase in monetary inflation.

The scale of the problem needs to be grasped in order to assess how destructive it will be for government finances and ultimately state-issued currencies.

https://zh-prod-1cc738ca-7d3b-4a72-b...ages/Water.jpg


Introduction
Listening to recent commentaries about the repo failures in New York leads one to suppose there is insufficient money in the system. This is not the real issue, as the chart below of the fiat money quantity for the dollar clearly shows.

https://zh-prod-1cc738ca-7d3b-4a72-b...ater_graph.png


The fiat money quantity is the amount of fiat money (in this case US dollars) both in circulation and held in reserve on the central bank’s balance sheet. Before the Lehman crisis, it grew at a fairly constant compound growth rate of 5.86%. Since the Lehman crisis, it has grown at an average of 9.45%, even after the slowdown in its rate of growth that started in January 2017.

FMQ is still $5 trillion above where it would have been today if the massive monetary expansion in the wake of the Lehman crisis had not happened. If there is a shortage of money, it is because the process of debt creation to fund current expenditure is spiralling out of control.


It is not just the US. If we take similar (but less detailed) figures for FMQ in other major nations by adding together broad money M3 and central bank balance sheets, we find that it has increased at varying rates for the most important economies. In China, the compound annual growth rate has been 12%, though the growth in Japan at 5.2% and in the Eurozone at 4.9%. has been more subdued, reflecting stagnant levels of bank credit. When for the lack of any other measure statisticians use a GDP money total as a substitute for defining economic progress, we should not be surprised to see that the economies with the greatest rate of monetary growth are reckoned to be the best performing.


Just as GDP tells us nothing about human progress and its benefits to society, other uses of money as a control mechanism for economic management are equally misleading. Much of the monetary expansion has been to fund unproductive government spending. Most of the balance after the government’s cut has fuelled speculation in the financial sector and has funded consumer credit for those whose savings have been tapped out.

Not revealed by the acceleration of money supply growth is the wealth transfer effect which impoverishes every productive individual for the benefit of governments, the banking system and the bank’s favoured customers, who are in the main large corporates and directly or indirectly the hedge funds.

Decades of impoverishment by monetary inflation, which has quickened since Lehman, is a very serious matter and is behind the fragility of economic systems dominated by government spending deficits.

The reason there appears to be not enough money is because the acceleration of government liabilities in nominal currency terms is catching up with them. Laurence Kotlikoff’s famous 2012 estimate of the US Government’s future commitments of a net present value of over $222bn is very much alive on arrival.


It would be more accurate to say the figure for the US is trending towards infinity. It is already infinity in Japan and the Eurozone, where negative interest rates and bond yields offer the basis for the net present value calculation. As in most things financial, the public is blissfully unaware of the true implications of low and negative interest rates and ultra-low bond yields.

They take the view that very low interest rates permit their government to borrow as much as it likes to provide the public with new hospitals, schools and the like. It is a case of fools of politicians and central bankers having turned everyone else into fools, and the few who realize it have no idea how to reverse the process. What they do not see is the government cannot now fund public healthcare and pensions, which make up the bulk of future obligations in a welfare state, without accelerating monetary debasement even more.


No one can know what the true figure is for future government liabilities, of which welfare is an increasing component. Politicians, who claim that a week in politics is the long term, fail to see any problem. The few governments which have raised retirement ages have done so to deal with escalating current welfare liabilities, not addressing those of the future that will lead ultimately to the destruction of what as Westerners we generally agree is civilized democratic society. That is their successors’ problem.


If history and reasoned economic theory is any guide, the demands for credit by the state will terminate in the destruction of government currencies. For the truth of the matter is inflation of money and credit has created the illusion we can all live beyond our income, our income being what we produce.


Nothing, with the sole exceptions of a central bank and its commercial charges can make money without having to advertise for it: the seigniorage is simply taken without public consent. Without questioning how it arises, the extra money allows us to indulge in all our flights of fancy until at some time reality strikes. Rather like Monty Python’s glutton, Mr Creosote, can we force in a little more inflation before we all explode?


The credit cycle is now on the turn
The complaint that the current precarious position faced by major economies is due to a shortage of money is untrue. The problem is one of escalating expenditures, and anyway, the response to any shortage, as we saw recently with problems in the US repo market, is simply to issue more money. But it is no solution, only making the eventual crisis worse.


It is easy to increase the quantity of money, but virtually impossible to increase the quantity of goods to accompany it. For this reason, increases in the quantity of money disadvantage ordinary people, the everyday producers of goods and services in small and medium sized enterprises. And with more money in circulation but the same quantity of goods, the pressure mounts for prices to rise. For a time, consumers can escape price rises by substituting cheaper goods from abroad.

This reduces the impact of price rises in the domestic market. Savers are also beneficial for price stability, because they defer their purchases to a future date. But in the absence of savers taking the steam out of inflation-fuelled demand, and contemporary American tariffs on Chinese imports designed to limit them by erasing the price advantage handed to China by America’s monetary inflation, the effect is bound to raise the general level of prices.


Consequently, legacy businesses in America have hoped for a bonanza through not being forced to compete with China. For too long, they have seen the costs of production rise, driven by rising input costs, government regulations, their own expanding bureaucracies, and the natural tendency for expenditure to rise towards the income available. Having been bound hand and foot by red tape they hope that tariffs will protect them from foreign competitors who are not. They maintain their higher noncompetitive prices only to find that consumers, who have not had the benefit of the new free money, are not prepared to pay them or are unable to afford them. Sales volumes suffer and losses begin to accumulate. An international problem provoked by trade protectionism becomes a domestic setback, which is the transition currently hitting the US economy.


We already see the evidence of a developing slump as well in other countries, not directly involved in the trade spat between China and America, but also dependent on the world’s two largest nations measured by trade engaged in their trade war. The member states of the Eurozone are all reporting disappointing internal trade conditions, as are virtually all other nations which report them. The solution, the inflationists say, is more money.


It is a call that has even evolved into a demand that borrowers should be paid to borrow through negative interest rates, killing off the few savers left in the advanced economies. The source for the investment in production deemed necessary to keep the world’s economy from crashing is no longer backed by genuine savings, but by increasing quantities of money conjured out of thin air directly or indirectly by the banking system.


Those that benefit from inflation by expansion of bank credit are those who do not need it, because they are creditworthy and can always raise funds in the market.

The problem lies with those who are not creditworthy. No amount of monetary inflation will rescue them, because the banks, in America for instance, have already loaned almost all of the equivalent of their own capital to non-financial borrowers who are deemed to be less than investment grade, in other words junk, both directly and through collateralized loan obligations. In the coming months, or it might even be just a matter of weeks, the banks will protect themselves by turning from providers of liquidity to withdrawing it. Inevitably, a volte-face on credit by the banks will bring on the slump. A systemic crisis will then ensue, and central banks will be forced to ride to the rescue by printing yet more money.


As we saw following the Lehman crisis, the money will be printed to bolster banks’ reserves in return for government debt accumulating at the central bank, so most of that newly printed money ends up covering the government’s deficit through the purchase of government bonds by the central bank.


A credit cycle will have completed: the post-Lehman stabilization, followed by an uncertain recovery, then a return to normality. Normality matures into complacency, with bank credit being expanded in favour of increasingly risky borrowers. The post-credit expansion crash, mirroring Lehman, is now in the making.


It is a repetitive cycle, the consequence of earlier monetary interventions by the central banks. They have been unable to stop themselves. The decision to pull the plug on Lehman, only a second-rank investment bank, nearly brought down the entire global financial system.

No central bank can take that risk again. We can be certain the solution to the next credit crisis will be a further acceleration of the production of money and credit with no one in the financial system being allowed to fail. And the expansion of base money directed at bolstering the banks’ balances will predominantly favour the one borrower class left with any financial standing, the governments.


But what we see is two forces joining together to accelerate the demise of state-issued currencies, which at the end of the day are only backed by the faith and credit the public holds in their governments’ finances.

The upcoming credit crunch will occur against a background of a rapidly increasing burden of welfare liabilities, so dramatically identified by Laurence Kotlikoff seven years ago, and likely to have increased markedly from his alarming estimate.

Inevitably, the prolonged suppression of government bond yields will begin to end, and irrespective of central bank interest rate policies, they will rise as investors realize that adjusted for a more realistic estimate of price inflation than that provided by government statisticians, they are a costly safe haven. Then, government finances will become so visibly out of control that even modern monetary theorists will return to their textbooks to see which bit they failed to understand.


The dawning of monetary inflation on the general public
Today, the public is blissfully unaware of the inexorable trend of monetary debasement while enjoying the continuing benefits of government welfare.

Government economists tell them that moderately rising prices, the consequence and justification for expanding the quantity of money and credit, are good for them. And who are they to question the experts?

Fortunately, people pursuing their daily lives usually adapt to the circumstances forced upon them by governments. A targeted two per cent inflation rate of prices is not overtly disruptive, and government statisticians have become skilled at goal-seeking price inflation figures. Everyone’s experience of price inflation is different, so government figures become believable by default. But for some considerable time, increases in peoples’ wages have badly lagged the price rises of their normal purchases, which bear little relation to the composition of governments’ consumer price statistics.

Coupled with the financial freedom afforded to them to borrow, they have made up the difference between income and expenditure just like any modern government: by borrowing with little or no intention of repaying.


The cause of the problem people face is the continual destruction of their personal wealth by monetary inflation. It has led to a fundamental difference between the credit cycle today and those earlier described in the textbooks of the Austrian School of economists.

Before Keynesianism took hold, investment in production was funded by savings. Those savings have been substantially destroyed. Instead of savings being a cushion against uncertainty, for practical purposes they no longer exist.

There are two consequences that concern us here. The first is that the burden of investment and its continuity now falls entirely on the state and its licenced banks, whose only recourse is yet more monetary expansion. The second is the almost total reliance today’s wage earners place on receiving their monthly salary to survive, with a reported 78% of US workers living pay-check to pay-check.

British workers are similarly strapped. They have no means of surviving a credit crisis and the economic consequences that follow. That will be another cost that falls to the government and its central bank to add to already escalating welfare commitments.


It is becoming easy to envision the day that the majority of government spending is financed by inflation and inflationary borrowing, through a combination of falling tax revenues and escalating spending commitments. There is also an imbalance between taxpayers, with a mobile wealthy class bearing the bulk of national tax burdens who can up sticks at any time. The question then arises as to how financial markets will react when the triple conjunction of a credit crisis, sharply increased government deficits, and the long-term escalation of welfare costs, materialize in the public consciousness all at the same time.


Ahead of the next credit crisis, the knowledge that things are not quite right has so far led to a flight to perceived safety: in some countries, investors are even paying to own their government’s debt. In the US, the yield on the 10-year US Treasury bond has declined from 3.2% a year ago to 1.4% today.


As the next credit crisis materializes, perceptions of investment risk are bound to change radically.

The imperative to print money at an even faster rate will accompany the trend towards deeper negative interest rates, penalizing bank deposits, eliminating residual savers from the system.

Consequently, if the Fed makes the mistake of even considering negative interest rates, it will put the whole commodity complex firmly into backwardation from the money side because all commodities are priced in dollars.


We can take anticipation of lower and more widespread negative rates as guaranteed when the credit cycle enters its crisis stage. Last time, everyone was so relieved that life after Lehman’s death continued that they still regarded government debt as the risk-free yardstick for financial investment. It would be foolish for a central bank to think this trick could be pulled a second time.

Just imagine how high the fiat money quantity in our introductory chart would be above that long-term pre-Lehman trend line. And just think of the damage to the purchasing power of the dollar and the other major fiat currencies from interest rate policies that are bound to drive deposits towards widespread encashment.


This time, the coincidence of a credit crisis and rapidly escalating short- and long-term welfare commitments adds a new dimension to the inflation story. Far from rescuing the global economy, the spreading of zero and negative interest rates can be expected to expose the true worth of fiat currencies. Next time is different in another respect: there is a new generation of educated men and women who through cryptocurrencies have learned of the fiat currency fallacy ahead of the event.

In the past, nearly everyone learned of it too late. Now, around the world, particularly in America and China millennial's could accelerate the ending of fiat money by triggering an early shift out of fiat into cryptos. Bitcoin at a million dollars becomes no longer pure fancy, only don’t forget that a million dollars might not buy you much.


It is not an expected outcome, except by the very few who understand what is happening to money and the built-in escalation of its quantity.

These will include growing numbers in the cryptocurrency community and the few who have studied the subject away from the influence of macro economists.

Hopefully, they will now include readers of this article.


Anticipating a crack-up boom
As the credit crisis drives monetary expansion into overdrive or leads into a hyper inflationary slump, people are bound to begin to discard their national currencies in favour of any goods they think they might need in future.

Minimal cash liquidity becomes the desired position. It can rapidly lead into the final short-lived boom that marks the death of an unbacked fiat currency, when it dawns on the general public that their government’s currency might be worthless. As the conviction of it grows, the pace at which it is dumped for anything of use that they can get their hands on increases exponentially. In Germany, it lasted from about May 1923 until the following November when the mark finally expired.

It has long been a theme of survivalist libertarians that this will occur.


So long as the alternative of owning physical gold and silver exists, it is not necessary to stockpile necessities, unless, that is, disruptions to supplies are anticipated.

In a slump, the prices of goods will decline measured in sound money. This, after all, was firmly impressed upon Keynesian inflationists by the experience of the early 1930s, when measured in gold substitutes prices of nearly everything fell heavily. When gold and silver became more desirable relative to owning goods, their purchasing power increases while that of fiat currencies declines.

Putting supply considerations to one side, if in the wake of the next credit crisis the economic conditions of the 1930s return, those that use gold and silver as money will see the prices of their consumer staples fall, so there should be no hurry to hoard them.

https://www.theburningplatform.com/2...A4#more-205575


Central Bank Issues Stunning Warning: “If The Entire System Collapses, Gold Will Be Needed To Start Over”

Via ZeroHedge

It’s not just “tinfoil blogs” who (for the past 11 years) have been warning that a monetary reset is inevitable and the only viable fallback option once trust and faith in fiat is lost, is a gold standard (something which even Mark Carney hinted at recently): central banks are joining the doom parade now too.

An article published by the De Nederlandsche Bank (DNB), or Dutch Central Bank, has shocked many with its claim that “if the entire system collapses, the gold stock provides a collateral to start over.”

https://pbs.twimg.com/profile_images...oLj_normal.jpgwillem middelkoop@wmiddelkoop

Wow

Dutch National Bank goes 'Big Reset':

'Aandelen, obligaties en ander waardepapier: aan alles zit een risico [..] Als het hele systeem instort, biedt de goudvoorraad een onderpand om opnieuw te beginnen. Goud geeft vertrouwen in de kracht van de balans van de centrale bank'.
https://pbs.twimg.com/media/EGqcEclW...jpg&name=small

While gloomy predictions of a monetary reset are hardly new, they have traditionally been relegated to the fringe of mainstream financial thought – after all, as Mario Draghi stated on several occasions in recent years, the mere contemplation of a “doomsday scenario” is enough to create the self-fulfilling prophecy which materializes it. As such, it is stunning to see a mainstream financial institution open up about the superior value of limited supply, non-fiat, sound money assets. It is also hypocritical given the diametrically opposed Keynesian practices regularly engaged in by central banks and official institutions worldwide: after all, just a few months back, the IMF published a paper bashing Germany’s adoption of the gold standard in the 1870s as the catalyst for instability in the global monetary system.


Fast forward to today, when the Dutch Central Bank is admitting not only did gold not destabilize the monetary system, but it will be its only saviour when everything crashes.

The article, as loosely translated and titled “Goud van DNB” (“Gold from DNB”) states:
“If things go wrong, prices may fall. But, crisis or not, a gold bar always holds value.” This makes it the opposite of “shares, bonds and other securities” all of which have inherent risk.


https://zh-prod-1cc738ca-7d3b-4a72-b...tch%20gold.jpg

Photo of gold bars from the DNB’s article “Goud van DNB.”According to the IMF’s latest data, the DNB holds 615 tons (15,000 bars) of gold mainly in Amsterdam, with other stores in the U.K. and North America; the value of this gold reserve is over €6 billion ($6.62 billion). Calling gold the “trust anchor,” the article details briefly why the hard asset is so important to wealth building and the global economy, claiming: “Gold is… the trust anchor for the financial system. If the whole system collapses, the gold stock provides a collateral to start over. Gold gives confidence in the power of the central bank’s balance sheet.”

Why this sudden admission of what goldbugs have been saying for years? Perhaps it has to do with the fact that on October 7, the bank announced it would soon be moving a large part of its gold reserves to “the new DNB Cash Center at military premises in Zeist.”


Almost as if the Netherlands is preparing for the grand reset, and is moving its most valuable asset to a “military” installation just for that purpose.

As bitcoin.com tongue-in-cheek points out, “DNB is no stranger to playing along with the Keynesian, inflationary games of the global monetary system. A system which, according to some, is now more a Ponzi scheme based on force and blind faith than sound economic principle.

That notwithstanding, the centralized financial powers of the world know the real score, and that’s why hard assets like gold are hoarded and locked down while everyday, individual residents of these geopolitical jurisdictions are encouraged to spend and spend, going further into debt to prop up ultimately unsound national economies.”

It is hardly a coincidence that in its preparation for monetary doomsday, the Dutsch Central Bank is also set to begin cracking down on crypto exchanges and wallets, stating that “firms offering services for the exchange between cryptos and regular money, and crypto wallet providers must register with De Nederlandsche Bank.”


While the push for greater KYC/AML transparency is a growing global trend, and is hardly surprising in a world in which trillions in assets reside in “tax-evading” offshore jurisdiction, the remarkable aspect of this latest crackdown against crypto – which many see as a modern, more efficient form of “gold” – is the fact that invasive regulations and restrictions by central banks can be seen as yet another means of stockpiling precious assets. This time, not gold bars, but bitcoin and crypto.

As for the timing of the “great monetary reset”, which other central banks have already quietly hinted at themselves amid massive repatriation of physical gold from the New York Fed to various European central banks such as Germany and Austria, we are confident that the trust-keepers of the current establishment – such as other central banks and the IMF – will be kind enough to provide ample advance notice to the citizens of the “developed” world to exchange their fiat into hard assets. Or, then again, perhaps not.

https://www.theburningplatform.com/2...qLNI6Pa-GdSuyw

UNDERESTIMATING THEM & OVERESTIMATING US

“Do not underestimate the ‘power of underestimation’. They can’t stop you, if they don’t see you coming.” ― Izey Victoria Odiase

https://www.marketplace.org/wp-conte...it=1800%2C1000

During the summer of 2008 I was writing articles a few times per week predicting an economic catastrophe and a banking crisis. When the biggest financial crisis since the Great Depression swept across the world, resulting in double digit unemployment, a 50% stock market crash in a matter of months, millions of home foreclosures, and the virtual insolvency of the criminal Wall Street banks, my predictions were vindicated. I was pretty smug and sure the start of this Fourth Turning would follow the path of the last Crisis, with a Greater Depression, economic disaster and war.

In the summer of 2008, the national debt stood at $9.4 trillion, which amounted to 65% of GDP. Total credit market debt peaked at $54 trillion. Consumer debt peaked at $2.7 trillion. Mortgage debt crested at $14.8 trillion. The Federal Reserve balance sheet had been static at or below $900 billion for years.

During 2007, a risk averse senior citizen couple (my parents) who had accumulated $200,000 of retirement savings over their lifetime of hard work, could generate $10,000 of interest income in a Vanguard money market fund yielding 5%. This supplemented their modest Social Security income of $20,000 to $30,000 per year. The interest rate on savings during normal economic times was generally 2% above inflation, which hovered around 3% in 2007 according to the data manipulators at the BLS.

As the summer of 2008 progressed, I felt more disconnected. I had been doing everything possible to support Ron Paul’s candidacy for president, but the masses weren’t ready for the truth or the reality of our situation. In my opinion the country was already off-course and headed towards a debt created disaster. But the average American was oblivious. The economy appeared strong. People’s 401ks were soaring. And homeowners in many markets had seen their homes double in value – on paper. I felt stupid as I had exited the stock market and bought some bear mutual funds and ETFs during 2007 and 2008.

The stock market had more than doubled since the 2002 lows. The control fraud systematically implemented by the Wall Street cabal and their captured political hacks also drove home prices to astronomical heights, making the average home owner think they were richer than they were. Billions of home equity loans were used by delusional dolts across the land to buy luxury vehicles, take exotic vacations, and basically live far above their means. When that fake equity evaporated like a puddle in the Sahara Desert, the delusional masses found themselves living in those luxury vehicles, until the repo man showed up.

The irrationality and insanity of the Wall Street created housing bubble was perfectly captured in Michael Lewis’ brilliant takedown of the Wall Street cabal in the Big Short. When Steve Eisman interviews a Florida stripper doing a pole dance and finds out she “owns” five houses and a condo, he realizes the housing boom is a complete fraud and goes all in shorting the exotic worthless derivatives created by the criminal bankers.

September 2008 marked the beginning of this Fourth Turning, with the global implosion of financial markets, the bankruptcy of Lehman Brothers, double digit unemployment, six million home foreclosures, a 50% collapse in the stock market, the deepest recession since the 1930s, and shell-shocked consumers defaulting on credit card and auto loans to the tune of hundreds of billions.

As consumer credit contracted, retail stores began going bankrupt in vast numbers. Mall operators were left with 50% or vacancy rates. They couldn’t make the loan payments on their debt. By March of 2009 the country was in a full-blown crisis. My storage area in my basement was filled with food, cases of water and other emergency supplies. I was sure we were at the beginning of an economic period, similar but worse than the Great Depression of the 1930s.

I certainly overestimated my forecasting ability and underestimated the abilities of the ruling class to take outrageously reckless steps to retain their power and manipulate the masses into believing extreme abnormalcy was actually normal. The first outrage perpetrated by the oligarchs was passing the $700 billion TARP bailout of the feckless Hank Paulson lied and threatened to protect his billionaire buddies.

The turning point occurred on March 16, 2009 when the pocket protector wearing spineless weenie accountants at the FASB were threatened by Bernanke and his henchmen into overturning their mark to market rule and allow the criminal Wall Street banks to value their worthless mortgages at whatever they chose.
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Citicorp, Bank of America, AIG, GE, Goldman Sachs, and most of the other “Too Big To Trust” goliath banks were bankrupt. They should have been liquidated using the bankruptcy process, with their good assets sold to banks who did not undertake fraudulent risks, and their executives and investors suffering the consequences.
The fear mongering and fake accounting propagated by Bernanke, Paulson, Geithner, and their corporate media fake news propaganda machines had the sole purpose of shifting the fraudulently created Wall Street private losses to the taxpayers through deficit funded handouts, free money, accounting fraud, and throwing senior citizen savers under the bus. Wall Street became richer than ever while Main Street got fucked again.


As a Ron Paul, Austrian school of economics believer, myself, along with many other logical minded rational thinking people, believed a short violent recession where bad debt was expunged from the system through liquidation and the economy was reset based on corporations and consumers acting conservatively and living within their means – using debt sparingly for long-term purposes, was the best road going forward.


I overestimated the intelligence, critical thinking skills, self-restraint and math aptitude of the masses by believing they had learned their lesson after experiencing the second Fed induced market crash in an eight-year period. I thought the American people and their leaders would come to their senses and realize the parabolic increase in debt since the 1990s had to end.

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I underestimated the level of fear amongst the Fed, financiers, politicians, mega-corporations, and billionaire oligarchs when just a leveling off of credit market debt resulted in global financial implosion. And I clearly underestimated the illegal lengths Bernanke and his fellow puppets would go to in order to save their Wall Street owners and corporate, political and media parasites reliant upon the ongoing Ponzi debt scheme being sustained.


If I had only believed in the power of massive debt issuance, nine years of zero interest rates for Wall Street banks, $3.6 trillion of Fed QE to relieve Wall Street of its bad debt, hundreds of billions of debt financed corporate stock buybacks, luring millions into 7 year auto loans, and allowing Wall Street hedge funds to buy up the millions of foreclosures and rent them back to those who they had booted onto the street.

If you told anyone in 2007 the national debt would go from $9.4 trillion to $22.8 trillion in twelve years, they would have called you a loon and laughed you out of the room. Now the national debt is 105% of GDP and consumer debt exceeds $4 trillion. Millennials are enslaved with $1.6 trillion of student loan debt, up by $1 trillion since 2009. The ruling class and their propaganda machine have convinced the masses $1 trillion annual deficits are normal and sustainable. Nothing bad has happened – Yet.


Our so-called leaders have implemented the exact opposite “solutions” to a debt crisis than what was required. Of course, this is true only if our leaders were interested in the long-term sustainability of the nation and its unborn future generations. If the ruling class is only concerned with their wealth, power and control over the masses, then their actions make complete sense.


If I hadn’t underestimated the evilness, greed and egocentricity of the entrenched establishment oligarchs, I would have stayed invested in the market, reaping the 300% returns since the 2009 lows. It has certainly paid to bet on the continued treachery of the traitorous central bankers, politicians, mega-corporation executives, and the fake news media. Only truly devious, deceitful, demented wizards of financial fraud could drive total credit market debt from $54 trillion to $74 trillion as the solution to a debt crisis.

After eight years of emergency level financial suppression, the latest Fed puppet, Jerome Powell, dared to raise rates above zero and suspend the continued buying of government debt. If we were really operating in a normal economic environment, market rates would be in the 4% range. But, miniscule .25% increases over a couple years pushing the Federal Funds rate to 2.25% was too much for Wall Street and the president to handle.


They have both been throwing hissy fits for the last year, intimidating and threatening the weak-kneed Powell into cutting rates with unemployment at all-time lows, the stock market near all-time highs, and the economy in its tenth year of expansion. Powell’s cowardly surrender is proof the Fed is nothing but Wall Street’s bitch, subservient and pliable to pressure from its owners.

“They’re keeping the rates down so that everything else doesn’t go down. We have a very false economy. At some point the rates are going to have to change. The only thing that is strong is the artificial stock market. The U.S. economy is in a big, fat, ugly bubble. I will get rid of the nation’s more than $19 trillion national debt over a period of eight years. I’m renegotiating all of our deals, the big trade deals that we’re doing so badly on.” – Donald Trump, September 2016.

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“The U.S. economy would grow more quickly if monetary policy were eased. If we had a Fed that would lower interest rates, we would be like a rocket ship. We don’t have a Fed that knows what they’re doing. Our most difficult problem is not our competitors, it is the Federal Reserve. The Fed raised rates too soon, too often, and doesn’t have a clue!” – Donald Trump, July 2019


I certainly overestimated the campaign rhetoric truthfulness of Donald Trump as he railed against the Federal Reserve for keeping interest rates too low, creating a stock market bubble, and contributing to the parabolic rise in debt. His promise to eliminate the national debt in eight years was impossible, but I thought he might rein in spending and reduce annual deficits.


It seems men who may have the best intentions to do what is right on behalf of the American people when they seek higher office or are appointed to positions of power, such as the Federal Reserve, are summoned into a dark boardroom and informed who are the real bosses and what truly makes the world go round.
The scene in Network where business mogul Arthur Jensen informs Howard Beale about the real world and who wields the real power probably comes closest to what Obama, Trump, Bernanke, Yellen and Powell have experienced as they were “convinced” to do the bidding of the corporate interests, military industrial complex, and banking cabal.

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“You have meddled with the primal forces of nature, Mr. Beale, and I won’t have it! Is that clear? You think you’ve merely stopped a business deal. That is not the case! The Arabs have taken billions of dollars out of this country, and now they must put it back! It is ebb and flow, tidal gravity! It is ecological balance!
You are an old man who thinks in terms of nations and peoples. There are no nations. There are no peoples. There are no Russians. There are no Arabs. There are no third worlds. There is no West. There is only one holistic system of systems, one vast and immane, interwoven, interacting, multivariate, multinational dominion of dollars. Petro-dollars, electro-dollars, multi-dollars, reichmarks, rins, rubles, pounds, and shekels.


It is the international system of currency which determines the totality of life on this planet. That is the natural order of things today. That is the atomic and subatomic and galactic structure of things today! And YOU have meddled with the primal forces of nature, and YOU… WILL… ATONE!

Am I getting through to you, Mr. Beale?

You get up on your little twenty-one inch screen and howl about America and democracy. There is no America. There is no democracy. There is only IBM, and ITT, and AT&T, and DuPont, Dow, Union Carbide, and Exxon. Those are the nations of the world today.”

So here we are, entering Trump’s fourth year in office as the Deep State and their cronies in Congress, the CIA, and fake news media use impeachment as their last straw in their ongoing attempted coup, and the national debt is up by $3 trillion since Trump took office. At the end of his first term the national debt will exceed $24 trillion and interest on that debt will approach $600 billion.

The tax cuts for corporate America and the richest individuals reduced tax revenues and resulted in corporations buying back billions of their own stock to drive the stock market to the highest valuations since the 2000 dot.com bubble. Meanwhile, Trump fed the military industrial complex with billions more, while funding war throughout the world. Rhetoric about ending wars is just bullshit for the masses. The entitlement outlays remain on an unsustainable path, as Trump and all the feckless politicians in D.C. pretend all is well. Nothing bad has happened – Yet.

The Fed balance sheet peaked at $4.5 trillion as they increased interest rates by a mere 200 basis points over a few years, still 200 basis points below what used to be considered normal. We’ve heard the boasts about the “best economy ever”, “lowest unemployment in history”, “stock market highest ever”, and “record corporate profits”, but with interest rates still at emergency levels and the Fed balance sheet a mere $750 billion lower than its peak, somehow the Fed feels compelled to cut rates and restart QE – but not calling it QE. Powell is bowing down to his Wall Street masters and Trump by taking actions which would only be taken during a recession or financial crisis.


GDP has averaged 2.5% in 2019, with consumer confidence high, consumer spending solid, unemployment at all-time lows, the stock market within spitting distance of all-time highs, and corporate profits at all-time peaks. Why would the Fed cut rates by 50 basis points, with more coming, and increase their balance sheet by $180 billion in one month, with a commitment to increase it by $60 billion a month for the foreseeable future?


Will these actions benefit the average person or the above average bank and corporate executives? Savers are again being sacrificed on the altar of corporate America. These actions by Powell and his fellow Fed co-conspirators are desperate measures disguised as planned policy actions, sold to the masses by the propaganda media as normal and beneficial to them.

As the daily Twitter wars are waged by Trump against his surveillance state foes and their confederates in Congress and the fake news media, the economic situation of the country marches relentlessly towards its catastrophic denouement. It appears no one on either side of the political divide is the least bit worried about the sustainability of an unsustainable economic paradigm.

I suppose I continue to underestimate the level of maliciousness, gluttony, and pure arrogance of those pulling the strings behind the curtain, as they rape and pillage the dwindling financial resources of our empire in its death throes. These psychopaths in suits care not for this country or its people. These globalist pricks want nothing more than pliable slaves, distracted by their iGadgets, sports, and Hollywood drivel.

The reaction by the big swinging dicks on Wall Street to the fake news trade agreement between Trump and China, along with the surprise Friday announcement by the Fed of $60 billion per month QE, was to drive stock prices skyward. I will no longer underestimate the lengths to which the establishment will go to maintain and expand their riches, power and control over our society.

I will also no longer overestimate the ability of the American populace to see through this charade and come to their senses regarding their unsustainable use of debt to try and maintain an unrealistic lifestyle. Their willful ignorance, created through government education propaganda and social engineering, will not be extinguished until the inevitable financial collapse wipes them out again.

This Fourth Turning certainly has not followed the path of the previous Fourth Turning. The existing social order has thrown every debt based “solution” at this debt-based crisis in order to avoid a 1930s like Depression. As we are eleven years into this Fourth Turning, the actions taken by the ruling class may have delayed the pain, but they have only assured the next leg down will be far worse than it needed to be. The social fabric of the country is being irreparably torn with the ongoing Deep State coup against Trump.

His impeachment and/or election of a gun grabbing socialist will surely lead to civil violence. The continued provocations between superpowers with nuclear weapons and a Middle East always on the verge of apocalypse only needs an arrogant misstep by an egomaniacal leader to trigger a global conflagration. I don’t think I’m overestimating the risk of catastrophe, but time will tell. Fourth Turnings have always swept away the existing social order in a chaotic whirlwind of death and destruction.

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“The risk of catastrophe will be very high. The nation could erupt into insurrection or civil violence, crack up geographically, or succumb to authoritarian rule. If there is a war, it is likely to be one of maximum risk and effort – in other words, a total war. Every Fourth Turning has registered an upward ratchet in the technology of destruction, and in mankind’s willingness to use it.” – Strauss & Howe – The Fourth Turning

https://www.zerohedge.com/geopolitic...ops+to+zero%29

Authored by Tom Luongo via Gold, Goats, n' Guns blog,
It’s become quite clear to me that the situation in Hong Kong is now about regime change through economic terrorism. What started as peaceful protests against an extradition law and worry over reunification with China has morphed into an ugly and vicious assault on the city’s economic future.

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These are being perpetrated by the so-called “Block Bloc,” roving bands of mask-wearing, police-tactic defying vandals attacking randomly around the city to disrupt people going to work.

Pepe Escobar has been doing exemplary work in recent months covering the ins and outs of Asian politics. His latest article covers the “Black Bloc,” their tactics and who’s likely behind them in Hong Kong.

More likely to be informed is Hong Kong garment and media tycoon Jimmy Lai, billionaire publisher of the pro-democracy Apple Daily, the city’s Chinese Communist Party critic-in-chief and highly visible interlocutor of official Washington, DC, notables such as US Vice President Mike Pence, Secretary of State Mike Pompeo, and ex-National Security Council head John Bolton.

On September 6, before the onset of the deranged vandalism and violence that have defined Hong Kong “pro-democracy protests” over the past several weeks, Lai spoke with Bloomberg TV’s Stephen Engle from his Kowloon home.

He pronounced himself convinced that – if protests turned violent China would have no choice but to send People’s Armed Police units from Shenzen into Hong Kong to put down unrest.

“That,” he said on Bloomberg TV, “will be a repeat of the Tiananmen Square massacre and that will bring in the whole world against China….. Hong Kong will be done, and … China will be done, too.”

Jimmy Lai is telling you what the strategy is here. The goal is to thoroughly undermine China’s standing on the world stage and raise that of the U.S. This is economic warfare, it’s a hybrid war tactic. And the soldiers are radicalized kids in uniforms bonking old men on the heads with sticks and taunting cops.
Sound familiar? Because that’s what’s going on in places like Portland, Oregon with Antifa. Except in Portland the government is the one turning a blind eye to the growing violence in pursuit of the cause.

And that cause is chaos.

Now whether or not this strategy of roving bands of vandals will work to stop China’s takeover of Hong Kong at the appointed time is still up in the air.

But, in my mind, it’s clear that there is a much larger game afoot here than just Hong Kong. This is an Empire Waning trying to maintain its position against an Empire Rising.

Looking at the total geopolitical picture, I’m surprised that Pepe didn’t see the connection between China/Hong Kong and Saudi Arabia/Iran. Because it is clear as day to me.

He even gets the money quote in his article and misses it. In his recounting a conversation with a prominent member of the Chinese diaspora we get the following:
Via mutual Chinese diaspora connections that hark back to the handover era, he agreed to talk on background. Let’s call him Mr. E.

In the aftermath of dark Friday, Mr. E is still appalled: “Not only you’re harming the people making their living in businesses, companies, shopping malls. You’re destroying subway stations. You’re destroying our streets. You’re destroying our hard-earned reputation as a safe, international business center.

You’re destroying our economy.”
He cannot explain why there was not a single police officer in sight, for hours, as the rampage continued.

In a piece called, “A Peg for a Peg: That’s the West’s Offer for China” I outline the real stakes at play here. The Black Bloc are attacking commerce.

The goal? Break Hong Kong by breaking the peg of the Hong Kong dollar to the U.S. dollar.

A collapse of the Hong Kong dollar peg, like all price floors/ceilings, is inevitable. Pegging one currency to another will always create an unsustainable imbalance of payments that the central bank can only cover for so long.

In Hong Kong’s case the peg has fueled, alongside China’s spectacular growth, a property market that is insanely over-valued. So, attacking the value of said property is how you attack the peg.

The longer these protests go on, fueled and organized by outside elements (read US and British intelligence actors), the higher the probability that capital will flee Hong Kong and undermine the peg, creating a massive market dislocation overnight.

Think back to 2015 when the Swiss National Bank finally broke its peg to the euro after having turned itself into a hedge fund trying to stop the appreciation of the franc versus the euro. The bottom fell out of the euro/franc pair overnight, adjusting 30% in a matter of minutes.
When a major peg like that breaks, systems break. Societies break as well.


I’ve said from the beginning of these protests that the extradition law wasn’t about ‘freedom,’ it was about China wanting to extradite U.S. and British intelligence agents working at British banks. The very real angst over China’s takeover of Hong Kong was cynically stoked at the outset.

How does this relate to the Saudi Arabia/Iran conflict? If Saudi Arabia doesn’t sue for peace with the Houthis, and, by extension, Iran then it is going to lose everything. Pepe was the first person that I saw who reported on the possibility of a Houthi attack on Medina or Mecca as a death blow to the Saudi regime.

The Saudi Riyal is pegged to the dollar as the lynchpin for the petrodollar system that under girds the global offshore dollar system, which is undergoing sincere liquidity problems now and into the future.

The petrodollar is dying and I agree with Martin Armstrong that it won’t be important in the long run, but it still is in the minds of the men setting U.S. policy. So that makes it important when analyzing the motives of the men setting the policy.

So, the gambit is simple. If China, doesn’t stop undermining U.S. relationships with our allies by investing in Iran or offering to buy Saudi oil in Yuan then we are going to burn Hong Kong to the ground.

Attacking Hong Kong’s peg while the threat to the Saudi Arabian peg is real makes perfect sense.

The evolution of these protests, never truly organic in the first place, against an avalanche of virulent anti-China propaganda is a very dangerous thing. From basketball to a stupid card game like Hearthstone China’s influence on U.S. corporate institutions is now front page news to justify what’s happening in the minds of virtue signaling Americans.

The secondary goal? To turn the U.S. electorate even more anti-China than they were before by appealing to their self-righteousness.
The reality is that for companies like the NBA and Blizzard revenue from China matters and it matters more every day, certainly for Blizzard. And part of what the wake up call for Americans is that loss of exceptionalism as consumers. Someone else can have a say in how our people act and that galls us.


Welcome to the rest of the world. Put down the crappy Starbucks coffee for a second and realize that we’ve been doing this exact thing to foreign companies for decades.


Because we wouldn’t think twice if Blizzard stripped a kid of his title for shouting Antifa crap. So why should China tolerate it?

This is especially true because both acts would be purely staged political theater bought and paid for by the very people the kid thinks he’s fighting against.

I’m not absolving China here. Their social credit system is abominable. Their state capitalism is a teetering edifice of dominoes. The angst over Hong Kong becoming part of China is real and justified.

I’m just not buying the gaslighting of it as some existential threat to our freedoms when the same tactics of marginalization and censorship are eroding our freedoms here.


China’s the bogeyman here.
Because Hong Kong is a blueprint folks. So is Portland. And the goal of all those images of huge protests from three months ago was to keep us thinking that’s the reality is in Hong Kong now and forever.

It’s not. It’s just a bunch of radicalized (and paid for) roaming pawns attempting a regime change operation against the wishes of the majority of the people organized by external forces scared of their coming and rightful retribution.

And like the mobs at the end of Joker, once unleashed they won’t be content until the city burns because, ‘everything must go’ and the system liquidated.
Because that’s who the elites have outsourced their operations to without a care in the world what happens to the people they’ve ‘liberated.’

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The question is are you going to look on this and smile?
* * *
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October 14, 2019 9:39 PM

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