Lets Just Get It Over With

I’ve heard several podcasts recently advocating that the powers to be should just “rip the bandaid off” the delusional ponzi economy and just get it all over with, rather than drag out this illusion of a recovery and a never ending bull market.

You do NOT want this scenario in my opinion. This dose of reality will leave you in a world you will not find friendly. You will not find the restoration of the “rule of law” an easy hurdle to achieve. Ripping the bandaid off will result in a rapid collapse and actual chaos with a closing of the markets. Your gold and silver will have no price. Your gold and silver miners will not be sellable, much less priced.

It would be tantamount to a cancer of any paper you have in the system. It could even metastasize to your bank accounts overnight. Emergency measures would then be instituted to insure that you have some type of helicopter money available to you for basic essentials. Your investible capital would be frozen with no ability to take advantage of price dislocations in other desirable assets. All credit markets would seize up with commerce grinding to a halt. Your Wal Mart would not even open up. Amazon would accept no orders. A few mom and pop stores would accept cash or barter while they sold out their inventory.  Mad Max would soon rule the streets. You know the rest.

..And The Circus Came To Town
So what is going to happen if the Fed and the Government  pick the path of the dollar and the stock markets? Its NOT going to be a “rip the bandaid off” scenario for them. Its going to be a continued money printing and currency debasement. They are not going back to spam and storable water unless an external event (see nuclear/bioweapons etc.) occurs beyond their control. They are going to try and modestly deflate the current bubble/economic cycle and proclaim their current path of “tightening” has ended. The market will CONtinue to CONvulse over time and they will then rapidly announce a new period of QE and negative interest rates. This transition (once it begins) will occur in a shorter time period compared to the last cycle. This entire scenario could take place over the next 6 months OR it may be a year or two.

One major difference this time is the dollar. This year dollar weakness will lead the story as the U.S. economy weakens (see Apple earnings). The dollar strength has wreaked havoc on the developing world this year and must be halted and it will. It will evolve as the takedown progresses. Oil must strengthen quickly this year from a weakening dollar. Watch for more oil swap arrangements to put increasing pressure on dollar supremacy. Hopefully major military engagements are several years down the road but these too would be dollar supremacy challenges. We make nothing but debt. Do you really believe in a major military intervention that Russia and China would be selling us anything in dollars? Our dollars would be worthless. I hope that scenario is NOT in the near term, but it is possible.

Will there be nervous/panicky disruptions ahead? Probably. Will the dollar get wiped out this year? Doubtful. You want them to keep this takedown CONtrolled. You want your pharmacy open. You want your Grocery store open. Prices will be higher and inflicting more pain on an already stressed middle class. There will be increasing shortages too. The Bear is here and its starting to roar. No one believes it. Reality and truth are hard for sheep to digest. You hope there are asset dislocations that you can take advantage of if you are seeing your investments/savings appreciate..ie. PMs and PM shares converted into needed/desirable assets. 

Before you cry foul and say you are betraying  your economic morals let me just say that printed money/QE is a rape of real economics/capitalism and has put us all on a cliff. I know that and its disgusting. I am only telling you that once they embarked on this policy it has placed us all on their addiction needle and the transition from a corrupt system will be better off for those of us prepared  to occur over time. I don’t want to use that ammunition and stored food. I don’t think I will have to use it, but I might need to. I think they will keep slow boiling us, but the water will be uncomfortably warmer this year. This year will not be a Buttfox/CS ponzi celebration year. Butt will be need a lot of paste this year and next.