Fund Manager Warns: “The System Is Starting Its Final Collapse”
SilverDoctors.com
December 3, 2015
Something catastrophic is occurring behind “the curtain.”
The final systemic collapse has begun, and it is going to “BLOW OUR MINDS“…
Submitted by PM Fund Manager Dave Kranzler, Investment Research Dynamics:
The director of the CME Metals Group announced her resignation to effective December 11. No further explanation was provided – Reuters link. I’m not one to infer some type of conspiracy theory in connection with this, but it seems rather abrupt. It’s akin to Bernanke leaving the Fed much sooner than anyone expected. The rats are leaving the ship before it sinks.
The collapse began in earnest in 2008. This is why gold soared to all-time highs in dollar terms until late 2011. The effort to push down the price of gold is overt evidence that the systemic collapse, even with the heavy application of money printing, has been ongoing since 2008. The recurring violent hits to the price of gold using fraudulent paper gold is overt evidence that the authorities are becoming more desperate in their attempt to hide any possible market signals that the systemic collapse is accelerating. This is how gold behaved from March 2008 – October 2008. Look what happened then.
Something catastrophic is occurring behind “the curtain.” I would love to have a peak at what is melting down. We can generally speculate that, with the oil, copper and iron ore price collapse, and with emerging market currencies collapsing, there’s been a series of derivatives explosions that have been contained but that are straining the Central Banks’ abilities to keep the system from coming completely unglued. This is also why the price of gold is being contained with brute force.
We have never seen markets behave the way they’re behaving right now, with absolute unpredictability. The overt intervention is a big part of the what we’re seeing on the surface with gold, currencies, credit markets and the primary stock indices. But all indications suggest a high likelihood of several train wrecks occurring at once behind the scenes. The intervention, of course, is keeping the surface indicators from crashing. But the intervention has also destroyed the signal transmission and rational capital allocation mechanisms of the market. Adam Smith’s “invisible hand” has been amputated, if you will.
This is why stocks like AMZN, FB, GOOG and NFLX trade at insane p/e ratios. It’s debatable whether or not AMZN has bona fide economic net income in the first place. I have not looked in depth at the accounting of FB, GOOG and NFLX to assess whether or not their “net income” is a function of GAAP manipulation or if they actually produce real cash flow in excess of all expenses, on and off the income statement. But all of them unequivocally trade at sublimely irrational market caps and they are the primary devices being used to keep the S&P 500/Dow indices propped up.
Another indication of the chaos erupting behind the “curtain” is the melt-down going on the junk bond market. Alhambra Partners wrote a piece in which it asserted that the stunning spike higher in triple-CCC rated junk bonds is indicative of something blowing up in the junk bond market – LINK. But it’s not speculation, it’s a fact. And it’s not “something,” it’s the entire distressed credit asset class.
The Rest…HERE
