Wednesday, July 27, 2016

FOMC Laughably On Hold; Gold, Silver Take Off

Market conditions are becoming strained, as evidenced by the flatness of the past two sessions, each directly related to the two-day FOMC meeting concluded this afternoon.

As expected, the FOMC did nothing, save for bloviating on about macro economic conditions, hinting that they would be on track to raise interest rates to more "normal" levels at some point in the future, depending on the data they receive.

What the Fed, via their rate-setting governors at the FOMC is effectively saying is nothing, but if one watches markets closely enough and listens carefully, here's the real message:

The Fed is not going to raise interest rates to anything even approaching normal - that is, possibly a federal funds rate (overnight) of 2 1/2 to 3 percent, a prime rate of 6 percent and a deposit rate of savings accounts of 4 to 6 percent - at any time in the next four to seven years, unless things get really out of hand, like you worthless peasants and debt slaves rise up and actually elect that uncouth slob, Donald Trump, as president, continue to grow cryto markets like bitcoin and Steem, take your money out of banks and stat paying down debt, paying for things in cash, or, heaven forbid, barter amongst yourselves.

They get it at the Fed. All they're interested in is maintaining the status quo, meaning, you go to work for feeble wages, while they and their cronies sit on their fat rumps and collect huge checks for appearing to be in control of the economic situation.

They're not in control unless the people allow them to be. Once the people lose faith - confidence - in the fiat money system, they're toast.

Another few signs that the wheels have come off the global debt Ponzi scheme were the gains in gold and silver on the day, in two separate ramps, first, at the market open (9:30 am EDT) and at the rate policy announcement (2:00 pm EDT). Silver and gold reached levels last seen during the Brexit bounce, with Gold hitting $1340.00 the ounce and silver on fire to nearly $20.40, gaining more than 80 cents on the day.

The financial, political and social fabric are becoming increasingly intertwined and fraying at the same time. Along with grabbing up sole gold, silver, lead, brass, and bottled water, canned goods are also a cheap option for securing one's future, and also quite edible, something that can't be said of nearly any other asset class.

The Wednesday Effect:
Dow Jones Industrial Average
18,472.17, -1.58 (-0.01%)

5,139.81, +29.76 (0.58%)

S&P 500
2,166.58, -2.60 (-0.12%)

NYSE Composite
10,739.58, -33.41 (-0.31%)

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