Weekly Update: Gold, Silver, Bitcoin – 06.16.2017

Approximate spot prices

Gold: $1,250 per paper ounce
Silver: $16.70 per paper ounce
Bitcoin: $2,500 per coin

Another eventful week is in the books. In the last update I said that it was time to buckle up for the summer, and this week we had an even further escalation of tensions when a Bernie Sanders volunteer leftist opened fire on Congressional Republicans, critically wounding Steve Scalise. That American legislators were attacked while practicing baseball – the historical American pastime – has a noteworthiness about it that won’t soon go away. I’d expect this to linger in the consciousness of the nation for longer than other incidents primarily because of the higher profile of the targets. We’ll see if can last through the end of the month and still be toward the front page.

As always, we’re simultaneously seeing the media meltdown trend continue unabated. It’s on overdrive now with these Manchurians. Press on comrade! Down with Trump! No to fascism! Death to capitalism! Refugees welcome here! Racism! Sexism! Privilege! It’s all so laughably boring at this point that if it weren’t literally so dangerous a brainwashed ideology it could be eliminated from public discourse by laughter and rational conversation. However, that’s not what 2017 has for us.

My take is that we will see some broader conflict, but those who are expecting an escalating internal conflagration will ultimately be disappointed. The possibility for increased violence exists, but in order for it to spiral out of control some real machismo would be required. Useless cowards are good for propaganda but not for revolution. Low testosterone beta males make docile subjects but not resilient footsoldiers. Conflict involves actual aggression, and this population has been trained into an oversensitivity that renders them useless in a prolonged conflict.

Their primary tools are all noise-based: shaming, virtue signalling, and literally screaming. Look at this picture and ask yourself how many well-trained operatives it would take to seize back control of Evergreen State College:

Every time I see this image I’m reminded of the scriptures saying that one will put a thousand to flight.

If God-loving Americans everywhere will seek the Lord, raise their voice en masse, and cry ‘ENOUGH!’ this can end without further loss of life. Unfortunately, we can never underestimate the potent apathy of our culture. Don’t yield the square of public discourse. Speak the truth and the lies will scatter. Never apologize for speaking the truth. Stand firm in Christ. Think about what the next generation will become when these individuals are the parents. Perhaps the natural course of teenage rebellion will return to some sense of normalcy and traditional values. Maybe conservatism is the new counterculture after all.

Gold

The Fed raised rates again this week but lowered their longer term expectations. There was a big pop in gold with a rush of terrible economic data on the day of the announcement, but the standard gold crushing soon resumed to put us back below the $1,260 level. It would have been strong if that held up, but the crucial point now is that $1,300 overhead resistance. One school of thought views the continuing dynamic of rate hikes as a way to wind down the current system. I’d tend to agree to the extent that the blame game is still ongoing, and we still need clarity on exactly how it will play out. Many are predicting significant disruptions as we move forward. They’ll either be right or wrong. Continue to accumulate future value in the meantime. It’s worth noting that there was no reaction in precious metals when the Alexandria shooting began to be reported. Does that mean that gold is no longer a measure of instability? On the contrary, it shows you that these prices remain totally controlled. Steady hands and patience are still required, but we’re once week closer to the payoff zone. The laugh of the week went the Fed publicly discussing their plan to wind down their balance sheet.

Silver

If you have any gains from stocks, bonds, real estate, or cryptocurrencies, then now is a great time to rebalance some of those into silver. Buying silver anywhere under $20 is a deal of a lifetime. The suppression regime is obviously still in place, and those who have expected Russia and China to call the bluff of the Western banking system appear to have underestimated the patience that the East applies to its strategic developments. You’ll know when the mania hits, so continue to accumulate. I’m likely going to add ethereum to my coverage soon because the price action is more interesting and the applications more nuanced. It feels like the advice for silver is always the same – probably because it should be in this environment. The price is controlled but won’t be forever. Accumulate this extraordinarily valuable asset. Buy and hold. The end. Check back in next week for more of the same unless reverse psychology kicks in and this is the time for the suppression regime to end.

Bitcoin

It’s incredibly tempting to look at the latest pullback in bitcoin as manufactured. There was an absurdly bogus bill presented in the US to attempt to add bitcoin to civil asset forfeiture so that you’d have to declare it when traveling. Have some fun by memorizing the private key on your paper wallet and laughing at these fools. The bill was so ludicrous that I could be forgiven for suggesting it was invented out of thin air not to be implemented but to be used as a driver for a pullback so institutional money could get off the sidelines. However, maybe its possible that a simple pullback from $3,000 was appropriate. I don’t see why it’s unreasonable for us to revisit prices below $2,000, but by the time we’re back together next week we could be at all time highs again.

Please note that the volatility here and the lack of bandwidth on exchanges have led to significant outages for people trying to jump in on the pullbacks. The cynic in me would suggest that the exchanges need prevent massive external demand in order to avoid another Mt. Gox incident because they don’t actually hold 100% of the actual bitcoins that are represented in customer accounts. Yes, there is rehypothecation in the cryptocurrency space as well. Get a paper wallet or a hardware wallet and transfer your cryptos out of the exchanges and into your possession. Before that happens your cryptos don’t properly reside on the blockchain.

Expect the volatility to continue. I’ve used gains in bitcoin to fund purchases of silver and ethereum. We’re still in the early days of this revolution, and you’ll want to do your homework so that you don’t get sucked in by the various voices that either universally shun the cryptos or universally pump them. Be intelligent. Take smart risks. Have some fortitude. This is still in wild west mode.

Conclusion

I’d prefer not to repeat myself, but I will until people get it: DO YOUR OWN HOMEWORK. The best recommendation can get botched if you don’t know what you’re doing. Become knowledgeable. Consume information. If you can’t explain the thesis in point and detail at a fifth grade level then stay out of the game because you’re going to get shook. Enough of the nonsense. We’re in the big leagues now and everything is on the table.

Disclaimer: These are one amateur’s fallible opinions. Holding any asset is risky, so do your own research and make your own investment decisions.