Run on the “Gold” Bank

Recent reports show 1,300 tons of gold are missing from the Bank of England.  Further, LBMA warehouse inventories of gold have dramatically decreased.  The London Bullion Market Association (LBMA) is the international trade association that represents the wholesale market for gold and silver, which is centered in London but has a global client base.  Daily gold prices are set in London.  GOFO (Gold Forward Offered Rates) turned negative beginning July 8th.  See: http://www.lbma.org.uk/pages/index.cfm?page_id=55&title=gold_forwards&show=2013&type=daily#latest  In theory, this isn’t supposed to happen.  The gold paper market is breaking down.  This tells us that people want their physical gold now and they are not confident that they can get it in the near future.

The U.S. is releasing highly questionable economic data.  Recently, they changed the meaning of employment to show an improvement in the unemployment numbers.  Before long, the panhandlers on the street may be included as being “employed”.  Don’t forget the children who are paid an allowance for doing chores.  I feel another redefinition coming.

John Williams of shadowstats.com wrote: “This should become increasingly evident as the disgruntled global markets begin to move sustainably against the U.S. dollar.  As discussed earlier, a dollar-selling panic is likely this year—still of reasonably high risk in the next month or so—with its effects and aftershocks setting hyperinflation into action in 2014.  Gold remains the primary and long-range hedge against the upcoming debasement of the U.S. dollar, irrespective of any near-term price gyrations in the gold market.”

What does all of this mean?  Physical gold is moving from the Western nations to the Eastern nations.  The recent smackdown of the gold price did not increase the availability of physical gold for sale but in fact is reducing the supply.  Why?  Because people are buying at cheaper prices and holding as insurance against further currency debasement.  The same is true for silver.  It appears that the central planners called on the Bank of England to handle the smackdown by selling 1,300 tons of gold into the market.  Oops, it did not produce the outcome they hoped for.  Instead, their inventories got “jack slapped” by the Kings of the East.  What were they thinking?

The derivatives in the banking system are highly toxic.  If the Fed begins to taper it Quantitative Easing(printing digital money) soon to any large degree, interest rates are going to go up sharply.  This will literally endanger the entire banking system.  Bond values will plunge, government interest expense will go sky high, pension funds will again suffer greater losses, etc.  It will be like a scene from the Lawrence Welk Show where all the bubbles pop.

However, the populace will not be smiling.  Since 2008, The Fed has printed tremendous amounts of money and the economy will not respond.  They are running out of options.  They know it.  The Kings of the East know it.  We know it.  When will the music stop?  Only Our Heavenly Father knows.

Spiritual preparation is of greatest importance now.  We are approaching a climax of economic change and a majority of the people will not be equipped to handle the change.  They will look to Our Heavenly Father for guidance in the midst of their desperation.  The Remnant will be the ones who will be tasked by Heaven to bring forth the Kingdom.  I don’t think we are decades away from this climax, a few years at the most.  A few days at the earliest.  We must keep our eyes on Above.  Each day counts.

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