Gold World News Flash |
- HSBC’s London Gold Vault: Is This Gold’s Secret Hiding Place?
- On the Feasibility of a Return to a Gold Standard
- China's Crashing - Stocks, Commodities Plunge After "Top Authority" Implies "Abandoning Loose Policy"
- Fundamental Picture For Silver Has Changed…In a Good Way: Thomson Reuters GFMS
- Price Of Gold Is Breaking Out But “Commercial Traders†On The Wrong Side?
- “The Death Of The Gold Market” – Why One Analyst Thinks A Run On London Gold Vaults Is Imminent
- Canada wildfire likely to burn for months
- Benjamin Fulford: May 2, 2016 Is It Time For Pope Francis To Confess To Involvement In Argentine...
- BREAKING: Fracking caused Fire in Canada !?
- "The Death Of The Gold Market" - Why One Analyst Thinks A Run On London Gold Vaults Is Imminent
- FULL Event: Donald Trump Holds Rally in Spokane, WA (5-7-16)
- If Everything Is So Great, Where Are The Unicorn IPOs?
- Albert Edwards: "Let Me Tell You How This All Ends"
- Monetary Liquification, Gold And The Time Of The Vulture
- Is NOW the Time to Start Buying Silver? David Morgan
- Why Europe May Collapse
- Full Interview: Donald Trump at ABC's "This Week" | May 8, 2016
- BullionStar: The London Gold Market
- The Bank of Canada Is BANKRUPT - We Break Down The Central Bank's Insolvency
- Bullion Star graphic displays the fraud of the London gold market
- Paul Craig Roberts: Warned The World Financial System Is On Fire And The Price Of Gold May Skyrocket
- American Billionaire Warns To Get Out of the Stock Markets and Run To Gold
- Mining Share, Gold, Stock Market Forecast
- TF Metals Report elaborates on reports by Mylchreest and Williams
- Coup in U.S.: Army Has Overthrown Obama! - Double Secret Martial Law Activated
- Will Trump Defy The Jewish Lobby?
- Five Bull Market Rules (in Gold & Precious Metal Stocks as well)
- Breaking News And Best Of The Web — May 8
| HSBC’s London Gold Vault: Is This Gold’s Secret Hiding Place? Posted: 08 May 2016 11:36 PM PDT Submitted by Ronan Manly of Bullionstar HSBC's London Gold Vault: Is This Gold's Secret Hiding Place? HSBC's main gold vault in London regularly comes under the media spotlight for a number of reasons. These reasons include: a) the HSBC London vault stores a very large amount of gold on behalf of gold-backed Exchange Traded Funds, primarily the well-known SPDR Gold Trust (GLD) b) along with the Bank of England vaults and JP Morgan vault, the HSBC vault is one of the 3 largest gold vaults in London c) the location of the HSBC vault in London is not publicised and so the secrecy creates intrigue d) HSBC every so often throws out some visual or audio-visual media bait about the vault, most famously in the case of CNBC's Bob Pisani and his camerman and producer visiting and filming inside the actual vault Despite all of the above, no one seems to have ever tried to figure out where this gold vault is actually located. Until now. In some ways HSBC has done a very good job keeping the location of its London gold vault under wraps. The main challenge is where does one begin to look for a vault in London from scratch. At first it would appear that there is nothing in the public domain pointing to the HSBC vault location. This is not entirely true however. The gold bullion activities of HSBC in London stem from two companies that over time became part of the HSBC group. My approach was to start by thinking about which London locations HSBC used to be based at. I took this approach because it became obvious that the HSBC London gold vault being used was still a battered looking old vault space in 2004 and 2005, which was after the entire HSBC company had moved to its spanking new London headquarters in Canary Wharf by 2003. In New York, the location of the HSBC Bank USA precious metals vault in Manhattan is well-known and is even listed in CFTC documents such as here. The vault is at 1 West 39th Street, SC 2 Level , New York, New York 10018 , which is the same building as 450 Fifth Avenue, which is the former Republic National Bank building that HSBC took over in 1999-2000. This Republic building at 450 Fifth Avenue, when it was being built, "had special vault requirements that reportedly added significantly to the project's cost". So its hard to see why HSBC makes such a big deal of not revealing its London vault location. History of HSBC gold operations in LondonIn 1993, HSBC Holdings plc relocated its headquarters to London after having acquired Britain's Midland Bank the previous year. Midland in turn had fully acquired Samuel Montagu in 1974 to form Midland Montagu. Samuel Montagu & Co was a City of London bullion broker, and one of the 5 original gold fixing members of the London Gold Fixing, and in turn, Midland Montagu was also a Gold Fixer. In 1999, HSBC began using the name 'HSBC' for the Gold Fixing seat of Midland Montagu. Between 1999 and 2000, HSBC completed the acquisition of Republic National Bank of New York. Republic National Bank of New York had been a big player in the world gold markets, and in 1993, Republic National had bought one of the London Gold Fixing seats from Mase Westpac, meaning that from 1993 both Republic National and Midland Montagu held Gold Fixing seats, and that HSBC ended up with 2 of the 5 Gold Fixing seats. Therefore, in 2000, following the Republic National takeover, HSBC in London sold one of its newly acquired seats to Credit Suisse. I also have always thought that the HSBC vault is in central London, and not in some far-flung outer London location. The LPMCL website (www.lpmcl.com) still displays text that says that the bullion clearer's vaults are in 'central London locations': "The five London bullion clearing members each maintain confidential secure vaulting facilities within central London locations, using either their own premises, or those of a secure storage agent…" Anyone who knows London will understand that 'central London' refers to a small number of central districts, and not some broader inside the M25 (ring road) definition. Before moving to Canary Wharf in circa 2003, HSBC occupied a number of buildings clustered around the north bank of the River Thames, including 10 Lower Thames Street (the Banks' Headquarters), 3 Lower Thames Street (St Magnus House), 10 Queen Street Place at the corner of Upper Thames Street (Thames Exchange – containing a trading floor), and Vintners Place (adjoined to Vintners Hall on the other side of Queen Street Place and Upper Thames Street). HSBC Bank USA NA (London branch)Until late 2014, the HSBC entity that was the custodian of the SPDR Gold Trust was "HSBC Bank USA NA (London branch)". NA means National Association. On 21 November 2014, effective 22 December 2014, the custodian for the SPDR Gold Trust switched from HSBC Bank USA, National Association to HSBC Bank plc. HSBC Bank USA NA (London branch), until 2015, was also the HSBC entity that was listed as a member of London Precious Metals Clearing Limited (LPMCL) on the LPMCL website. See, for example, September 2009 imprint of LPMCL website. The next step is therefore to see where HSBC Bank USA NA (London branch) was formerly located. The Financial Services Register (FSA Register) lists HSBC Bank USA, Reference number: 141298, effective from 24 January 2000, with a registered address of Thames Exchange, 10 Queen Street Place, London EC4R 1BE. Recalling the Republic National connection, the previous registered name for this entity was "Republic National Bank of New York", with the same address, effective from 18 December 1995 to 24 January 2000. The FSA Register entry also lists various well-known names of the HSBC gold world alongside this HSBC Bank USA entity, including Jeremy Charles, Peter Fava and David Rose. Recalling the Samual Montagu / Midland Montagu connection to HSBC, an entity called Montagu Precious Metals is also listed with an old address at "2nd Floor, Thames Exchange, 10 Queen Street Place, London EC4R 1BQ. An old gold information website called GoldAvenue from the year 2000, written by Timothy Green, also lists HSBC Bank USA (London branch) address as: HSBC Bank USA That same Gold Avenue web page also correctly listed the HSBC New York vault address as: HSBC Bank USA which is the same building as West 39th Street, New York, in Manhattan. The precursor to the SPDR Gold Trust was called Gold Bullion Ltd, a vehicle set up by Graham Tuckwell, promoted by the World Gold Council, and listed on the Australian Stock Exchange. Gold Bullion Ltd's first day of trading was 28th March 2003. Following Gold Bullion Ltd's launch, the SPDR Gold Trust (GLD) was then launched in 2004, but originally it was called STREETracks Gold Shares, and it even had another former working title of 'Equity Gold Trust' in early 2004. A May 2003 Marketwatch article about Gold Bullion Ltd and the early incarnation of the SPDR Gold Trust (Equity Gold Trust) can be seen here, and a speech by Graham Tuckwell about Gold Bullion Ltd to the LBMA annual conference in Lisbon in 2003 can be seen here. Most importantly, an early draft Prospectus of Gold Bullion Ltd (in MS Word), dated 10 February 2003, lists the Custodian of Gold Bullion Ltd as: CUSTODIAN BANK Therefore, Thames Exchange goes to the top of the list for further consideration, as does it's neighbour Vintner's Place. Thames Exchange and Vintners Place were both HSBC buildings and both buildings are situated right across the road from each other, with Queen Street Place literally bisecting the 2 buildings. Queen Street Place is also the road that acts as the approach road to Southwark Bridge, with the 10 Queen Street Place building and the Vintners Place building literally creating a canyon either side of the road. You will see below why Queen Street Place is interesting. Queen Street Place is very near the Bank of England and is in the City of London, so it's under City of London Police protection. It's also very near the River Thames, as is the JP Morgan London vault. To get to the Bank of England from Queen Street Place, you literally walk a mintute north up Queens Street, and then a few minutes north-east along Queen Victoria Street and you're at the Bank of England. An official HSBC letter-headed note documenting the Thames Exchange address and proving HSBC occupied this building can be seen here. Similarly, an official letter-headed note documenting the Vintner's Place address, and proving that HSBC occupied that building can be seen here. HSBC moves out of the City of London – 2002/2003A Property Week article from 20 April 2000, titled "JLL to mastermind HSBC's City exodus", covered the huge HSBC move out of the City to Canary Wharf in the early 2000s: "Army of firms called in to help co-ordinate bank's relocation to Docklands by 2002" "HSBC has stepped up its retreat from the City of London by instructing agents to open negotiations on the disposal of its outstanding City liabilities. In one of the most hotly contested pitches of last year, Jones Lang Lasalle has beaten rivals to secure the lead role as strategic adviser for the bank's relocation to Docklands [Canary Wharf] in 2002. In addition to JLL, the bank has instructed another seven firms to mastermind the disposal of its 121,000 sq m (1,302,445 sq ft) City portfolio." "HSBC has ruled out acquiring freehold or long-leasehold interests and has instructed agents to negotiate the best surrender or assignment of the occupational leases on its 12 City buildings." "Morgan Pepper is advising on HSBC's 17-year lease at Thames Exchange, 10 Queen Street Place, EC4. The Scottish Amicable building is currently under offer to Blackstone Real Estate Advisors for £73m. Insignia Richard Ellis, Chapman Swabey, Strutt & Parker and Wright Oliphant have positions on the bank's remaining interests in Vintners Place EC3; Bishop's Court at Artillery Street, and HSBC's 37,160 sq m (400,000 sq ft) office complex at St Magnus House and Montagu House. By the time STREETracks Gold Trust (the original name for the SPDR Gold Trust) was launched in 2004, HSBC Bank USA's address had moved to HSBC's new headquarters in Canary Wharf, in the Docklands, east of the City of London. By early 2003, Equity Gold Trust also listed the HSBC custodian with the Canary Wharf address. An article by engineering company Arup HSBC Headquarters – Canary Wharf – Arup), describing the new HSBC Canary Wharf building, dated 21 April 2004 stated: "The phased occupation of the [Canary Wharf] building was completed in February 2003 when the last of over 8000 staff moved in, with HSBC Group Chairman Sir John Bond officially opening the building as the Group's new head office on 2 April 2003." However, the old HSBC gold vault did not 'move' at the time the rest of HSBC moved lock, stock, and barrel to Canary Wharf between 2002-2003. In fact, the HSBC vault remained where it was in a slightly rundown shabby space with cream-colored walls. See multiple photos of the vault space below. The HSBC vault did however transform from an 'old' vault into a 'new' vault sometime between 2006 to early 2007. My belief, which I'll explain below, is that this vault didn't move, it just received an extensive renovation. A diagram of the HSBC headquarters in Canary Wharf where the whole London HSBC workforce moved to by early 2003 can be seen below. Notice the car parks in basements B2, B3 and B4. You can also read about the basement construction in the Arup document above. This is not the location for a beat-up old vault that can be seen in the below old gold vault shots. Besides, the vertical pillars/piles in the old and new HSBC vault are nothing like the huge structural pillars/piles found in the HSBC headquarters in Canary Wharf. The pillars in the old HSBC vault photos are pillars that would be found in an old arched vault, while the support pillars in the new HSBC vault photos are those that would be found in relatively shallow spaces under a road, such as pillars/supports used in the cut and cover New York subway system.
HSBC Gold Vault PhotosDecember 2004:Here you can see an early gold vault photo of Graham Tuckwell, joint managing director of Gold Bullion Securities, and Stuart Thomas, managing director of World Gold Trust Services, in the 'old' HSBC vault in December 2004 checking a HSBC bar list:
Source: https://web.archive.org/web/20051125081854/http://streettracksgoldshares.com/images/DSC_0130_800.jpg And another photo, taken at the same time, of Stuart Thomas in the vault in December 2004:
Notice the very old piping around the top of the walls. Source:https://web.archive.org/web/20051125082702/http://streettracksgoldshares.com/images/dsc_0178_800.jpg In fact, there are lots more photos of the inside of the 'old' vault on the StreetTRACKS website here https://web.archive.org/web/20060518124841/http://streettracksgoldshares.com/us/media/gb_media.php June 2005:See five photos below of vault in June 2005:
'Old' vault looks quite beaten with concrete pillars, old floor, old air conditioning unit, and awful decor, and some type of desk an chair and wiring on the very right hand side of the photo. October 2005:Managing Director Stuart Thomas, Director of Corporate Communications, George Milling-Stanley of World Gold Trust Services, and CFO and Treasurer James Lowe (wearing a gold tie) of World Gold Trust Services
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| On the Feasibility of a Return to a Gold Standard Posted: 08 May 2016 11:01 PM PDT *** This is fiction. *** This is an IMAGINARY discussion in the home of an important Federal Reserve official in the year 2016 … Federal Reserve Official #1: "We created, printed,... {This is a content summary only. Click on the blog title to continue reading this post, share your comments, browse the website, and more!} |
| Posted: 08 May 2016 10:04 PM PDT "After comprehensive judgment, our economic recovery cannot be U-shaped, cannot be V-shaped, but will be L-shaped," warns an 'authoritative' person according to a shocking report published by Government mouthpiece People's Daily. The report, explaining why investors should not expect growth to pick up soon or expect more stimulus to come soon further sets expectations for China to "face the issue of rising non-performing loans" and not continue to create zombie companies. The result - a bloodbath in stocks and commodities... Chinese stocks are down 4.5 to 7% in the last 2 days... as turmoil returns...
The report (found here), as Bloomberg summarizes, suggests China shouldn't loosen monetary conditions to enable growth...
And the impact on stocks and commoditiers (as the latter's bubble implodes) is clear - Short-term...
And Long-term...
As the churn collapses, volume disappears and Iron ore, Steel rebar, and copper all collapse back to un-credit-speculated reality - smashing The Baltic Dry lower also.
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| Fundamental Picture For Silver Has Changed…In a Good Way: Thomson Reuters GFMS Posted: 08 May 2016 08:51 PM PDT Guest(s): Erica Rannestad Thomson Reuters GFMS
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| Price Of Gold Is Breaking Out But “Commercial Traders†On The Wrong Side? Posted: 08 May 2016 08:44 PM PDT Price of Gold: The activities of the ‘commercial traders’ in the COT data is closely watched by the market participants, as they are believed to be the smartest of the lot. They take deliveries on their bets, unlike the speculators, who have no interest in taking a delivery. If you have followed the ‘commercial traders’, without paying attention to my proprietary predictive trend and cycle analysis for the price of gold and silver, you would be sitting on large losses, due to their ‘short positions’ which mean they expect price to move lower. |
| “The Death Of The Gold Market” – Why One Analyst Thinks A Run On London Gold Vaults Is Imminent Posted: 08 May 2016 08:12 PM PDT from Zero Hedge:
When it comes to tracking the nuances at the all important margin of the gold market, few are as observant as ADMISI’s Paul Mylchreest, whose December 2014 analysis showed the stunning role gold holds in the new normal as a funding “currency” for BOJ interventions in the form of a long Nikkei/short gold (and vice versa) pair trade, indicating that central banks directly intervene in gold pricing (by selling, of course) when seeking to push paper asset prices higher.
In his latest report he follows up with an even more disturbing analysis on the state of the gold market. Specifically, he looks at what historically has been the hub of gold trading, the London bullion market, and finds that it “is running into a problem and is facing the biggest challenge since it collapsed from an insufficient supply of physical gold in March 1968.” We suggest readers set aside at least an hour, and two coffees for this “must read” report. For those pressed for time, the executive summary is as follows: using data from the LBMA and Bank of England on gold stored in London vaults and net UK gold export data from HM Revenue & Customs, Mylchreest calculates that the "float" of physical gold in London (excluding gold owned by ETFs and central banks) has recently declined to +/- zero. Summarizing the data in the report.
The full details of how Mylchreest gets to this number are broken out in detail in the attached report; fast-forwarding to his troubling summary we read the following conclusion, one we have observed numerous times when analyzing the troubling trends within the gold vaults of none other than the Comex itself: “if we are correct, the London Bullion Market is running into a problem and is facing the biggest challenge since it collapsed from an insufficient supply of physical gold in March 1968.” Some more of the report’s core findings, most of which should come as no surprise to regulatr readers: * * * Besides the growth in physical gold demand from existing sources, there is more than US$200 Billion of trading every day in unallocated (paper) gold. If buyers lose confidence in the market's structure and ability to deliver actual bullion, the market could become disorderly (via an old fashioned "run" on the vaults) as it seeks to find the true price of physical gold.
Intuitively, we think that central banks might have lent/leased gold to maintain the status quo and mask what is technically a default. However, rather than being used to provide temporary liquidity, it is possible that loans/leases are being rolled. This is not sustainable and implies dual ownership claims. |
| Canada wildfire likely to burn for months Posted: 08 May 2016 07:30 PM PDT Officials fear growing fire could reach major oil sands mine nearby and even neighbouring province of Saskatchewan. The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers , Whistelblowers ,... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| Benjamin Fulford: May 2, 2016 Is It Time For Pope Francis To Confess To Involvement In Argentine... Posted: 08 May 2016 07:00 PM PDT Benjamin Fulford Report - May 2, 2016 Is It Time For Pope Francis To Confess To Involvement In Argentine Dirty War And Resign.http://benjaminfulford.net/ The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| BREAKING: Fracking caused Fire in Canada !? Posted: 08 May 2016 06:30 PM PDT BREAKING: "Magma Could Be Causing Chaos In Canada" Wildfires Reports that the Magma could be causing the chaos in Canada wildfires The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers ,... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| "The Death Of The Gold Market" - Why One Analyst Thinks A Run On London Gold Vaults Is Imminent Posted: 08 May 2016 06:22 PM PDT When it comes to tracking the nuances at the all important margin of the gold market, few are as observant as ADMISI's Paul Mylchreest, whose December 2014 analysis showed the stunning role gold holds in the new normal as a funding "currency" for BOJ interventions in the form of a long Nikkei/short gold (and vice versa) pair trade, indicating that central banks directly intervene in gold pricing (by selling, of course) when seeking to push paper asset prices higher. In his latest report he follows up with an even more disturbing analysis on the state of the gold market. Specifically, he looks at what historically has been the hub of gold trading, the London bullion market, and finds that it "is running into a problem and is facing the biggest challenge since it collapsed from an insufficient supply of physical gold in March 1968." We suggest readers set aside at least an hour, and two coffees for this "must read" report. For those pressed for time, the executive summary is as follows: using data from the LBMA and Bank of England on gold stored in London vaults and net UK gold export data from HM Revenue & Customs, Mylchreest calculates that the "float" of physical gold in London (excluding gold owned by ETFs and central banks) has recently declined to +/- zero. Summarizing the data in the report.
The full details of how Mylchreest gets to this number are broken out in detail in the attached report; fast-forwarding to his troubling summary we read the following conclusion, one we have observed numerous times when analyzing the troubling trends within the gold vaults of none other than the Comex itself: "if we are correct, the London Bullion Market is running into a problem and is facing the biggest challenge since it collapsed from an insufficient supply of physical gold in March 1968." Some more of the report's core findings, most of which should come as no surprise to regulatr readers: * * * Besides the growth in physical gold demand from existing sources, there is more than US$200 Billion of trading every day in unallocated (paper) gold. If buyers lose confidence in the market's structure and ability to deliver actual bullion, the market could become disorderly (via an old fashioned "run" on the vaults) as it seeks to find the true price of physical gold.
Intuitively, we think that central banks might have lent/leased gold to maintain the status quo and mask what is technically a default. However, rather than being used to provide temporary liquidity, it is possible that loans/leases are being rolled. This is not sustainable and implies dual ownership claims. Going forward, the market is vulnerable to several trends in physical gold trading patterns:
But the vulnerability is not confined to current trends in physical bullion. If there is no gold float, there is nothing supporting more than US$200 Billion of trading every day in unallocated (paper) gold instruments which accounts for more than 95% of gold trading in London. The convention of trading unallocated gold has been based on a fractional reserve system. It works as long as gold buyers retain confidence that the banks could deliver physical gold if demanded, but our analysis suggests that they could not. For more than four years, selling of paper gold overwhelmed growing demand for physical gold from the likes of China and central banks (in aggregate). The "gold market" became a chimera as fundamentals were turned upside down. Banks added paper "gold supply" in almost elastic fashion on occasions when western investors increased net gold exposure via paper gold instruments. We've argued for many years that a breakdown and bifurcation in the gold market between physical and paper gold substitutes would be necessary for accurate price discovery of physical gold bullion. The lead article in the January 2016 edition of the LBMA's quarterly magazine was titled "Wholesale Physical Markets are Broken", which might be confirmation that this process is reaching an advanced stage. In the interim, we could move towards a two-tier gold market - where physical gold trades at a premium to paper gold instruments, such as unallocated gold in London and COMEX gold futures in the US. It saddens us that London's position and reputation as the hub of the world gold market is in jeopardy unless the LBMA, BoE and other stakeholders embrace rapid and far-reaching reform. The London Bullion Market is structurally flawed and overdue for reform - it is not an exchange, it is under-regulated and there is near zero transparency. More than anything, it is primarily a system of paper credits/debits which benefits the banks and undermines the investment case for gold and, consequently, interests of gold investors. Seeing the Achilles Heel of London's gold market, China's Shanghai Gold Exchange (SGE) launched a Yuan-denominated physical gold benchmark gold contract on 19 April 2016. Examining the SGE's white paper, it's clear that China acknowledges that its introduction should lead to a more realistic price for physical gold and that its strategy is to shift price discovery in the gold market from London to Asia. Unfortunately time is running out for London and meanwhile… The vast pools of western capital are not underweight gold, they are almost zero–weighted. Ultimately, gold is a bet on financial system mismanagement in many guises - such as inflation, deflation, rising credit risk, declining confidence in policy makers, etc. The fact that mainstream investors and commentators have started to have doubts about central bank policies has been positive for gold. For years, the typical pushback on investing in gold by western investors was that it had no yield. In a bizarre twist of investing, more than US$7 Trillion of bonds now have negative yields thanks to unconventional monetary policies like ZIRP/NIRP, and gold investing can be justified on a yield basis. Unlike every other financial asset, including sovereign bonds, physical gold has no counterparty risk. We have been here before...
Anonymous quote from many years ago (the 1990s!) * * * Mylchreest full must read report below (pdf): |
| FULL Event: Donald Trump Holds Rally in Spokane, WA (5-7-16) Posted: 08 May 2016 06:00 PM PDT Saturday, May 7, 2016: Full replay of the Donald Trump rally in Spokane, WA at the Spokane Convention Center - Exhibit Hall A & B. FULL Event: Donald Trump Holds Rally in Spokane, WA (5-7-16) The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists ,... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| If Everything Is So Great, Where Are The Unicorn IPOs? Posted: 08 May 2016 05:00 PM PDT Over the course of the last week it seemed no matter where I turned in the business media one meme was being pushed above all others: It’s still a great time to be a private tech unicorn. Implying, that funding rounds were still “robust.” What wasn’t said, so I will, is this: It’s a great time to be a private “unicorn” rather, than take the chance and become the poster-child for the IPO apocalypse. For it’s better to be assumed a $BILLION dollar success story rather, than IPO and officially open the books to the market and remove all doubt – that you’re not. It would seem “additional funding rounds” is the story (the only story I’ll contend) that keeps the whole “unicorn” meme alive. For if these were great companies, at great valuations, with great prospects to earn or reward investors, founders, employees and so forth untold riches (which of course is told as to lure and keep talent and others) during the same period the “markets” were within a trading days movement of reaching never before seen in human history highs. How many tech unicorns of the over 150 now residing in the “unicorn stable” even hinted at a date, never-mind actually announced? __________ (Insert crickets here.) At this stage a few questions must now be addressed. One would be: If it not now, when? And not a vague “when.” But rather: precisely when? If a company today that has been raising funds to even be within this so-called “exclusive club” can’t articulate a date, or time period, with specificity. In other words: Definitive announcements that have meaning with dates such as those declaring “within the next 30, 90…,” whatever days. Or, something reminiscent of stating “November of this year barring a market panic or sell off etc., etc.” Not some lame “Market conditions warranted us deciding to postpone setting a date blah, blah, blah…” PR trash. Than are they to be believed of any metrics? Why is this so important one might be asking? Easy, let’s put this into some context: For all intents and purposes, 2016 is close to being over for just an announcement and the time needed to follow up with the subsequent roadshow to price and launch. Remember, we are currently 5 weeks away from the half-year point of 2016 without either an announcement or actual IPO. (Oh wait, there was one – Dell™. Need I say more?) Again, it must be reiterated: 2016 is now well into its 5th month and within spitting distance of “the first-half is history” mark. And during this period the “markets” have been within a percentage point of breaking the all time highs and still remain at elevated levels. The rise from the lows of February were not only meteoric, they were actually historic in both their percentage gains, as well as, time frame. Add to this the Fed. has all but conceded “extraordinary monetary measures and policy” are the norm, rather than temporary. While reiterating: will remain for the foreseeable future. And there’s not a one? Think about that. Does all that square with what you’ve been told (or sold) when it comes to everything “The Valley?” And speaking of “square….” It would seem the price for one of the “The Valley’s” most recent (recent as in Nov. of 2015) IPO’d unicorn’s: Square™ isn’t doing all that well. As a matter of fact, it seems to be doing as well as its other CEO’s responsibility: Twitter™. Remember when all the chatter and twit-storms were about how great it would be to have one CEO run two “disruptive” companies simultaneously? Especially when the “Jobs” reference was invoked? How’s that all working out? If you really want to know – just look to their stock chart. If you own them in your 401K? I’ll wager you already know even without looking at your last statement. As I’ve stated many times, I take no issue with Mr. Dorsey, or the companies he’s founded. Both he and his companies show great value, as well as, potential for the future. However, with that said, the idea that the valuations and metrics used were both “reasonable” as well as “sustainable” along with the idea that Mr. Dorsey should be applauded to take the reins as CEO of two publicly traded, highly competitive, as well as, ever evolving companies simultaneously? All while one is flailing in its stock valuation while the other debuts with an IPO? It was ludicrous at best – moronic at worst and I stated so. To this I was (as always) scorned and vilified by many a Valley aficionado. Yet, today? Well, let’s just say I’ve watched, read, or heard more revisionist statements about that “great idea” than I’ve heard a politician “clarify” their previous position. I’ve argued ad nauseam about the whole Valley’s “It’s different this time” knee-jerk response to criticism. Especially when it has come to the once coveted title of “IPO’d.” However, there’s also been another attribute which seems to be just as ensconced, as well as, obvious to those who are paying attention. e.g., Once rarefied air seems to be turning into exhaust fumes. And nowhere is this more apparent than with Apple™. Nearly two years ago to the day I penned the following article, “Did Apple Just Become Microsoft?” At the time this was a complete and utterly opposing viewpoint to anyone comparing Apple to _______(fill in the blank.) There was the acquisition of Beats™ along with what I depicted as a complete and utter cave in to Wall Street. As quoted in MarketWatch™ To wit:
At this time Apple was the; and I do mean the darling of both Wall Street, as well as, most 401K holders. During that time it was basically insinuated; to question anything Apple whether in terms of strategy, products, acquisitions, and more. It was implied: “You – just don’t get it!” Fair point. The only problem? As of today, near two years to the day – the value of your shares are worth about the same as they were then. And, for some – the same as two years prior in 2012. To even think of such a possibility during 2014 never-mind articulate or postulate the idea was met with dismissal as well as scorn. And guess what the current meme surrounding Apple is today? Hint: Has Apple become Microsoft? Which brings me around to another postulate which I’ve articulated that today is being met with just as much revile as well as repulsion to even consider the possibilities: Social media. Today much like Apple during the wake of the release of the iPhone 6S®, Facebook™ latest earnings release is being heralded as “the earnings report that should put all the nay-sayers to rest.” After all, it’s touted “just look at what they’re doing with mobile!” And it’s a fair point. However, what I thought was interesting that went either unnoticed, or, blatantly under-reported was the fact that Mark wants to add some new class shares so that when he sells his current shares he can remain “in charge.” OK, fair enough. It’s not like this type of thing hasn’t been done before. (If memory serves me, I believe Google™ for one did something similar) Yet, when you put it into context with another announcement made similar by Amazon™? It’s just one of those things that make you go hmmm…. What was the announcement? It seems (to borrow from my previous article) “In a complete and utter cave-in to Wall Street” (in fairness also with some impending pressure from regulators) Facebook along with Amazon it has been reported will declare more GAAP refined metrics as opposed to Non-GAAP when it comes to “equity-based pay costs.” i.e., reporting them as real expenses on the earnings reports. As it should be in my opinion. However, what does such a move hold for others? Others such as – new competitors? Older ones? Ones not even IPO’s as of yet? Or, better yet: how about when competing for those precious “to be allocated” sovereign wealth/central bank funds? After all, such a move would make most, if not all “unicorns” scrambling for funding rounds not only look worse than unprofitable. But probably looking closer to – insolvent. Imagine closing the door on future rivals with the possibility of making your own earnings statement appear worse. Now that takes not only some chutzpah, but if it were to work? It borders on genius! If you think Twitter, Square, or others have an issue reporting investor friendly incentive now? Just wait if their demanded (whether by regulators or peer pressure) to report using only GAAP. And for those remaining in the “Unicorn stables” awaiting cashing out in the IPO horse-race to riches? You’d be better off investing in any company that uses unicorn tears in its glue formulation. For you would all but drive a stake into the heart of most in the current batch of tech IPO’s in waiting. Imagine for a second you’re a rival to Facebook like, Oh I don’t know, let’s say Snapchat™. If you have yet to IPO: what are the chances you’re going to get anywhere near those implied valuations (I believe it’s somewhere around $16 BILLION) if now you’ll need to report using GAAP? Are you beginning to see my point? A move like this (if it actually was an intentionally executed tactic, to which I would commend from a business perspective as: brilliant) would all but surely close a door behind you stifling anyone rivaling your acquisitions or future customers. That and surely just as important – cutting off nearly all their future investment dollars. Any upstart or potential rival that is “cash burn” sensitive would be all but scorched out of business in no time. Then, all one would need to do is wait for the bankruptcy trial and pick up any patents and more on the cheap. As in very cheap. And it is precisely this which increases the potential as to keep more IPO’s off the market, rather, than on. And for one very often, overlooked reason: VC’s net worth can remain (or at least appear) more robust the longer it’s off the IPO scene – rather than on it. I know this sounds counter-intuitive at first but remember: For a few million dollars you could “invest” in a startup at the right funding level and have your “assets” stated to be worth multiples more. Much more, as in BILLIONS more. And don’t forget these “valuation metrics” for most of today’s tech unicorns are worth $BILLIONS and billions because? Hint: Because they say they are. That’s it. If you think Non-GAAP accounting was “inflationary” when it comes to a company’s worth. The stated metrics for valuing whether or not a “unicorn” is a “unicorn” makes Non-GAAP look conservative! So when it comes to all this nascent talk about “unicorns” and their subsequent funding rounds just remember: Is it really a great time to be a private unicorn? Or – has that window not only closed, but maybe, just nailed shut by two of the biggest to ever profit from the meme? |
| Albert Edwards: "Let Me Tell You How This All Ends" Posted: 08 May 2016 04:50 PM PDT The dollar's recent rapid slide has been accompanied by a constant backdrop of dovish cooing from the Fed. Until this week, SocGen's Albert Edwards notes that both equity and commodity markets had embraced the weak dollar as the elixir to solve all their ills. That relief, however, has now proved fleeting as fear of weak economic activity has reasserted its influence on investors. The weak dollar, Edwards warns, should be seen as merely a shuffling of deckchairs on the Titanic before the global economy sinks below the icy waves. Risk assets are once again refocusing on the increasingly dismal prospects for global growth rather than the short-term relief of dollar weakness, according to SocGen's inimitable Albert Edwards. The US remains the main concern, although the rapid unravelling of Abenomics in Japan and a likely imminent tightening of monetary policy in China to snuff out yet another housing bubble in the major cities also feature high on investors' worry list. But it is in the US that growth concerns remain most intense, with renewed weakness in the manufacturing ISM as we move into Q2 following on from the moribund 0.5% qoq Q1 GDP outturn. Yet there was some optimism around after the GDP release that non-farm businesses inventories have risen at a slower pace ie only $61bn in Q1 2016 against $87bn in Q4 2015 and a much faster $110bn pace in H1 2015. The slower pace of increase means that non-farm inventories have been a drag on GDP for three successive quarters, deducting an annualised 0.22% from Q1 GDP (and 0.12% and 0.8% in the two previous quarters). If you think that means that the inventory problem is solved though, think again. It's not the level of inventories that are the problem, but the level relative to sales which are at heights normally seen preceding or at the depths of recession (see chart below).
It is disturbing for the growth bulls that the recent slower pace of inventory accumulation has made absolutely no dent on this overhang. We remind readers of our view that it is the business investment cycle (fixed and inventory) which, despite comprising only 15% of GDP, 'causes' recessions in an accounting sense. The chart below shows that when yoy GDP is negative, the contribution of business investment to that decline is virtually 100%, ie recessions would seldom occur in the absence of the business investment cycle. With the US whole economy now plunging, the continuing inventory overhang is an increasingly precarious sword of Damocles hanging over investors' heads as profits swoon and liquidation beckons.
In addition to Edwards reality check, Andrew Lapthorne, SG's quant guru, has been flagging the following chart to clients... Firstly, we all know by now that US companies consistently put the most optimistic spin on earnings to gratify both analysts that follow their companies and investors who want to hear good news. These manipulated earnings are what is reported each quarter and referred to as pro forma earnings. Andrew points out though that even moderately 'scrubbed' MSCI trailing operating earnings have been falling away precipitately in the US (this is a moderate scrub as opposed to a heavy scrubbing as defined by the EPS reported on a GAAP basis). This ties up exactly with what the whole economy profits data is also telling us. Most notably the current divergence between trailing operating profits and pro forma measures only normally occurs as a recession begins to unfold. This matters because the stock market eventually stops reacting to the manipulated pro forma earnings and slumps in line with what is really happening under the bonnet (or hood for my US readers).
Let us return to the central banks and the games they are playing with the markets. The chart below shows just how detached US stocks have become from earnings (in this case we have used the MSCI operating metric discussed above). This is an exercise of stretching the PE elastic via loose monetary policy as far as you can in an attempt to boost real economic activity. Ultimately, though, if the earnings don't arrive, the elastic will snap back and hit you square in the face. If you think the US situation looks bad, take a look at the eurozone chart on the right below where earnings remain dead in the water and PE expansion makes up well over 100% of the rise in equity indices. We have previously lauded Mario Draghi's bubble blowing credentials as on par with Alan Greenspan.
But Edwards concludes by setting the scene for what is to come...
One final thought: On the front page of the Fitchburg Sentinel from July 31 1920, an exuberant business press headlined: "Ponzi will not reveal business secret."
This was published less than a month before Charles Ponzi's scheme blew up. As Edwards concludes, actually, isn't this exactly what central banks have done over the last few years to the financial markets? |
| Monetary Liquification, Gold And The Time Of The Vulture Posted: 08 May 2016 04:30 PM PDT from Gold and Liberty:
Paul Volker, who along with Milton Friedman advised Nixon to cut the ties between the US dollar and gold in 1971, was forced as Fed chairman to end the inflationary surge by raising interest rates to a draconian 21.5 %, in 1980.
After Volker's deflationary interest rate hike, inflation would not again be an issue despite the still expanding money supply. This anomalous absence of inflation would give rise to the erroneous conclusion that the Fed had somehow engineered a monetary miracle, a never-before-seen phenomena where continuing money growth did not lead to inflation but to a period of relative stability that economists called the Great Moderation. The Great Moderation from the mid-1980s to 2007 was a welcome period of relative calm after the volatility of the Great Inflation. Under the chairmanships of Volcker (ending in 1987), Greenspan (1987-2006) and Bernanke (starting in 2006), inflation was low and relatively stable, while the period contained the longest economic expansion since World War II. Looking back, economists may differ on what roles were played by the different factors in contributing to the Great Moderation, but one thing is sure: Better monetary policy was key. http://www.federalreservehistory.org/Events/DetailView/65 'The Great Moderation' was, in fact, merely 'The Great Delusion'. The absence of inflation was not due to "better monetary policy", but to a series of cataclysmic deflationary events i.e. Volker's 21.5% interest rates followed by the collapse of massive speculative bubbles which unleashed powerful deflationary forces offsetting the inflationary rise in prices that would have otherwise occurred with excessive money printing. In 1971, global monetary aggregates, MO, totaled $8 billion; by January 2016, global MO totaled $80.9 trillion, an astounding increase of 1,000,000 %. Such an exponential growth of the global money supply would have either ended in extreme inflation or hyperinflation were it not for powerful contravening deflationary forces. After Volker's 21.5% deflationary interest rates in 1980, the next major deflationary event was the bursting of the Japanese stock bubble on December 31, 1989. The Japanese Nikkei fell from a high of 38,957 down to 7,607; its collapse awakening deflationary forces not seen since 1929 crash which caused the Great Depression of the 1930s. Today, Japan is still trapped in a moribund downward deflationary spiral. …It has been over two decades since the popping of Japan's economic bubble and the country is still actively battling with deflationary forces that are so powerful that near-zero interest rates (zero-interest rate policy or ZIRP), repeated bouts of quantitative easing (some call it "money printing") and constant Yen-weakening currency interventions have barely made a dent. http://www.thebubblebubble.com/japan-bubble/ After the Nikkei's collapse, the US dot.com bubble burst in March 2000. Next, came the US real estate bubble whose collapse in 2007 lead to the Wall Street crisis of 2008; and, in August 2011, global markets plunged when the European sovereign debt crisis erupted. With each bursting bubble, demand collapsed and deflation gained additional momentum which central bankers attempted to overcome with more credit, more monetary stimulus, e.g. QE1, QE2,QE3, and more money printing; but despite central bank efforts to artificially induce inflation-indexed growth with monetary policy, deflation—capitalism's fatal wasting disease—triumphed.
On February 1, 2016, Professor R. Taggert Murphy, co-author with Akio Mikuni of Japan's Policy Trapnoted the global significance of Japan's 26-year losing battle with deflation: |
| Is NOW the Time to Start Buying Silver? David Morgan Posted: 08 May 2016 04:00 PM PDT from Reluctant Preppers: Legendary silver markets guru David Morgan, widely sought-after speaker, author and consultant to investment funds and tier-1 investors, visits you here on ReluctantPreppers.com to lay out the startling fundamental facts about the relative scarcity of investable silver vs. gold, and gives his expert insight on recent movement in precious metals markets for your awareness and benefit as you plan whether NOW is the right time for you to start acquiring real money, or add to your existing holdings in the face of the clear and present risks to your family’s financial well-being. |
| Posted: 08 May 2016 03:30 PM PDT Question: "Stefan once described men who held their emotions and problems for themselves as ghosts. He said he once was one because it was the only way to deal with his childhood. He also said being a ghost will destroy you in the long run. How does person break out of being a ghost and start to... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| Full Interview: Donald Trump at ABC's "This Week" | May 8, 2016 Posted: 08 May 2016 03:00 PM PDT Trump: No, the Republican Party Doesn't Necessarily Need to Be UnifiedFull Interview: Donald Trump on ABC's "This Week" | May 8, 2016 The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists ,... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| BullionStar: The London Gold Market Posted: 08 May 2016 01:59 PM PDT |
| The Bank of Canada Is BANKRUPT - We Break Down The Central Bank's Insolvency Posted: 08 May 2016 12:59 PM PDT Author and economic analyst John Sneisen talks with Josh Sigurdson about the insolvency of The Bank Of Canada and covers the reserves or lack-thereof as Canada sells off basically all of its gold. John perfectly breaks down all the examples of the Bank of Canada's insolvency. These privately... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| Bullion Star graphic displays the fraud of the London gold market Posted: 08 May 2016 12:32 PM PDT 3:30p ET Sunday, May 8, 2016 Dear Friend of GATA and Gold: Bullion Star has created a graphic illustration of the London gold market, showing that it is a fractional-reserve-based and largely unallocated market seemingly designed to deceive naive investors looking for a hedge against currency volatility in the form of an asset that can't be infinitely created in a flash, but often is. The graphic is posted at Bullion Star here: https://www.bullionstar.com/blogs/bullionstar/infographic-london-gold-ma... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT A Contrarian's Call Option on Gold Sandspring Resources' Toroparu project in Guyana is the fourth-largest gold deposit in South America held by a junior mining company. Experienced backers of Sandspring Resources include Silver Wheaton, the John Adams / Energy Fuels group in Denver, and Frank Giustra's Fiore Group in Vancouver. A 2013 preliminary feasibility study shows strong economics for this large-scale mine at US$1,400 gold. With a current gold price below US$1,300, Sandspring is for investors who believe that gold price suppression will be overcome. For a detailed report on Sandspring Resources by Tommy Humphreys of CEO.CA, please visit: https://ceo.ca/@tommy/a-ten-million-ounce-call-option-on-gold Support GATA by purchasing recordings of the proceedings of the 2014 New Orleans Investment Conference: https://jeffersoncompanies.com/landing/2014-av-powell Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: |
| Paul Craig Roberts: Warned The World Financial System Is On Fire And The Price Of Gold May Skyrocket Posted: 08 May 2016 12:06 PM PDT Economic collapse and financial crisis is rising any moment. Getting informed about collapse and crisis may earn you, or prevent to lose money. Do you want to be informed with Max Keiser, Alex Jones, Gerald Celente, Peter Schiff, Marc Faber, Ron Paul,Jim Willie, Steve Quayle, V Economist, and... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| American Billionaire Warns To Get Out of the Stock Markets and Run To Gold Posted: 08 May 2016 12:00 PM PDT Billionaire trader, Stanley Druckenmiller, recently stated that the current situation in the global economy is similar to the situation on the eve of the crisis of 2008. At the Ira Sohn Investment Conference in New York, he said, “The bull market is exhausting itself… The Fed has borrowed from future consumption more than ever before. It is the least data dependent Fed in history. This is the longest deviation from historical norms in terms of Fed dovishness than I have ever seen in my career.” |
| Mining Share, Gold, Stock Market Forecast Posted: 08 May 2016 11:51 AM PDT The stock market, as measured by the S&P 500, reached its 115 trading cycle top the third week of April. The next important cycle low is due on July 5th. The SPX is in process of making a head and shoulders top, and should continue higher into the mid-point of the Mercury Retrograde Cycle around May 11th. My target price is 2080. Friday was the new moon low, but also a top for the precious metals complex. |
| TF Metals Report elaborates on reports by Mylchreest and Williams Posted: 08 May 2016 11:50 AM PDT 2:50p ET Sunday, May 8, 2016 Dear Friemd of GATA and Gold: The TF Metals Report's Turd Ferguson today elaborates on Paul Mylchreest's new report on the exhaustion of the gold supply in London as well as on Grant Williams' recent report on the gold market, "Nobody Cares," perhaps because people may be starting to care after all. Ferguson's commentary is posted at the TF Metals Report here: http://www.tfmetalsreport.com/blog/7615/guest-post-death-gold-market-pau... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT The Committee to Destroy the World: This new book by Michael E. Lewitt is a passionate and informed analysis of the struggling global economy. Lewitt, one of Wall Street's most respected market strategists and money managers, updates his groundbreaking examination of the causes of the 2008 crisis and argues that economic and geopolitical conditions are even more unstable today. Lewitt explains how debt has overrun the world's productive capacity, how government policies have created a downward vortex sapping growth and vitality from the American economy, and how greed and corruption are preventing reform. For more information: http://www.wiley.com/WileyCDA/WileyTitle/productCd-1119183545,subjectCd-... Support GATA by purchasing recordings of the proceedings of the 2014 New Orleans Investment Conference: https://jeffersoncompanies.com/landing/2014-av-powell Or by purchasing DVDs of GATA's London conference in August 2011 or GATA's Dawson City conference in August 2006: http://www.goldrush21.com/order.html Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: To contribute to GATA, please visit: |
| Coup in U.S.: Army Has Overthrown Obama! - Double Secret Martial Law Activated Posted: 08 May 2016 11:23 AM PDT Obama has been overthrown by Gen Dunford, Amy takes over. FED shut down. According to this guest, we are under 'double secret martial law' The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| Will Trump Defy The Jewish Lobby? Posted: 08 May 2016 10:41 AM PDT Trump must know from his building experience that 9/11 was a phoney. It's disappointing he hasn't made some statement about that. The Financial Armageddon Economic Collapse Blog tracks trends and forecasts , futurists , visionaries , free investigative journalists , researchers ,... [[ This is a content summary only. Visit http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]  |
| Five Bull Market Rules (in Gold & Precious Metal Stocks as well) Posted: 08 May 2016 06:46 AM PDT Lets look at some observations, often called RULES, that apply to Bull Markets. 1. No Doubt this will leave everyone LMAOROF. Once Bull Markets are underway, fundamentals will no longer matter. How true I say. 2. Acquiring Companies tend to overpay when under pressure to acquire. |
| Breaking News And Best Of The Web — May 8 Posted: 07 May 2016 07:34 PM PDT Chaos and volatility are the new normal, with emerging markets the epicenter of the next crisis. All forms of debt, especially corporate, are even higher than before the Great Recession. China’s numbers are, as always, startlingly bad. The debate over gold’s COT report continues. Sanders promises a contested convention, Trump tries to unify “his” party. […] |
We've argued for many years that a breakdown and bifurcation in the gold market between physical and paper gold substitutes would be necessary for accurate price discovery of physical gold bullion. The lead article in the January 2016 edition of the LBMA's quarterly magazine was titled "Wholesale Physical Markets are Broken", which might be confirmation that this process is reaching an advanced stage.
In 1971, when the US ended the convertibility of the US dollar to gold, the only limit on the bankers' ability to print money ad infinitum—monetary gold reserves—was removed. This led to an immediate spike in inflation ending in an inflationary surge—from 3.3% in 1971 to 14.4% in 1980, a 436% increase. Economists called it the Great Inflation.
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