If We Are LUCKY...We Will Come Out Of This With a Very Severe Case of STAGFLATION

April 7, 2020

The Miles Franklin Newsletter

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From The Desk Of David Schectman

One of the most important factors to look at in today’s moves in the financial markets is that although equities have rebounded a greater percentage than gold, gold is the only asset class to now be trading above pre-pandemic levels.

What is also noteworthy and highly unusual is the spread between spot gold and gold futures. This spread continues to widen with the current spread reaching a differential of $49 today with spot gold currently fixed at $1657 up $41, and gold futures currently at between $1705 and $1706. One possible explanation for this spread that is widening is the expectation that the coronavirus in the United States will get worse before it gets better.

On a technical basis we see gold has formed an inverse head and shoulders formation with today’s move in gold futures breaking strongly above the shoulders indicating higher pricing ahead. The rally in gold futures could move as high as $1800 in the next two weeks. – Gary Wagner

BofA: "QE vs Unemployment" Means Soaring Inflation Will Crush The Dollar

Americans fear unemployment, Japanese & Germans inflation

Real-World Problems: The Current State Of The Gold Market In Plain Language

It is not so much about a shortage of gold, but rather a sudden demand for gold in places where it cannot be quickly supplied in the desired form.

David's Commentary (In Blue)

The only way you can get gold and silver is if you are willing to pay a premium of 50-90% HIGHER than the daily quoted price. There is very little supply and the demand is overwhelming. However, since the price is rising rapidly, it will probably cost you less to pay a higher premium now than if you wait for the premiums to fall only to find the price is so much higher that the overall cost to you was greater after the premiums fell.

Why is silver underperforming gold (the silver to gold ratio is a ridiculous 110 to 1)? Ted Butler says, blame it on JPMorgan. And on top of that, silver is performing like an industrial metal, and the economy in in the tanks.) Wait until it performs like a monetary metal, which it is too. It is moving back up now, and the rise will blow you away.

The media is in a frenzy. It is full of stories highlighting the shortages of hospital gowns, masks, respirators and ICU beds. People are dying by the thousands. There is also strong coverage on unemployment, and the sinking economy. The two topics are receiving more or less equal coverage. But they are not equal.

I maintained a month ago, when things still appeared to be relatively “normal,” that the lasting damage would be to the economy. The virus was just a pin looking for a bubble. I don’t mean to underplay the personal tragedy that Covid-19 is causing. But it will come and eventually go. We will learn to live with it, even if it returns every year, like the flu. I don’t expect lifestyles and the economy to snap back to “normal” in a month or two. The “experts” seem unanimous in their belief that it will take at least 18 months to create a safe and effective vaccine. Only then can our lives start to gradually move back toward the way it was. It may never be the same (another of my views from a month ago), but I hope at least the we can open the restaurants and re-instate sporting events. That’s a shallow way to look at things, but for those of you who are able to survive the financial hardships, and still have a job and your health, it would be a nice beginning.

Several years ago, Larry Eddleston predicted that the Dow and gold would both rise to new highs at the same time. Of course, he never could have imagined a Pandemic, but he may be right. Gold will hit new all-time highs, soon, and the Dow – well, that is still up in the air. It all depends on how much of the many, many trillions of newly created dollars are funneled back into the stock market. It wasn’t Joe Six-pack who pushed the Dow up over 1,600 points yesterday. It is very obvious that the Fed wants to save the stock market and the big banks, not the small businesses that are shuttered up all over the country.

What will the new world look like after people come out of their quarantine and go back to work? It’s meaningless to guess, but I’ll give you my two cents worth anyways. The rich will be even richer. There will be many more desperate, poor, unemployed and homeless folks. The government will be involved much more deeply into our everyday lives and more of our freedoms will be lost. Hopefully, more manufacturing jobs will return back home from third world countries and China, but that is easier said than done. It will take a long time to train our workforce to perform the new tasks.

Depending on when things turn around, we may end up with a new president and possibly a Democratically controlled Senate too. In the past, I would have said that would be financial suicide, but after the way the Federal Reserve has changed gears and is now in the midst of an all-out spending frenzy, we are already there. Can the dollar survive this? I guess we will find out.

Now that is what I am focusing on. If we are LUCKY, we will come out of this with a very severe case of STAGFLATION. I pray that is how this plays out, because the alternative is a Great Depression prior to Hyperinflation. In other words, life will not go back to “normal,” and the alternatives are bad and much worse.

If you have a large portfolio of gold and silver you can survive the financial pain. Especially if the stock market crashes and does not come back. That, by the way, is a highly likely scenario and it will take nothing short of a miracle, and much more Fed QE, Tarp and helicopter money to save it. The Fed can turn into another Bank of Japan and buy up all the stocks.

Regardless of how this plays out, it will take a long time before the global economy recovers. A long time. And I keep asking myself, how can the stock market hold up when the global economy is in shambles? It can’t – unless it is supported by the Fed, the big banks and hedge funds who will own most of it.

This is probably a good time to revisit the past. on December 29, 1989, the Nikkei Index peaked at 38,915.87.

The Nikkei closed on Monday at 18,712.88. After 30 years, the Nikkei is still 52% off of its high. If the Dow follows that model it will sit at 14,100 three decades from now. Rather than pick a “number” focus on the trend. It is very clear. To expect the Dow to reach new highs is much less probable than for the Dow to spend decades trying to regain its recent lofty highs.

What we need is for the economy to rebound, for more jobs to be created that offer a living wage, for the bottom two-thirds of the wage earners to reap the benefits of the massive monetary explosion that the Fed is unleashing. A rebound in the stock market is not the answer. Alas, it does not seem to be playing out that way. The man on the street is on the verge of bankruptcy and he gets a thousand bucks or more while the big banks and corporations and insiders rake in billions and billions. That, my friends, sounds like a recipe for social unrest, the kind that brings Marshall Law onto the streets.

So, as you sit in front of your TVs, passing away the days under quarantine, and watch all of this unfold, pay less attention to the “trees” and try and figure out what the “forest” will look like a year from now. Most of us will survive the coronavirus. What will the brave new world that arises from the ashes look like? Whatever it is, it will not look like what it was before the Pandemic hit and the world will not be a better place. A more important question is, can you survive it? Will you have a job? Will you still be financially secure? Would you have been better off moving from stocks to gold and silver?

Mike Savage

Things To Ponder …

IF we had “the greatest economy of all time” as was beaten into us for the last 3 years do you really think that the economy would have collapsed as it did in the past few weeks?

If $12 Trillion in global stimulus in a week can’t lead to rising markets- what is the number that will?

Is there a number that will OR is this a bottomless pit of debt that is going bad?

The economy is virtually shut down and people are shut-in. It appears that we could be shut in for another month. Even after that, how many will either not venture out, have no reason to venture out or have no means to buy anything but bare essentials after no pay for weeks?

The unemployment numbers for March were staggeringly bad. How many of you know that historically bad report was for data ending March 12 ^th .??? This is set to get a LOT worse and in a hurry.

Stock “markets” are being propped up by central bank buying, bank buying, and jawboning (jawboning being Fed officials or even the President making statements that computer algorithms pick up and initiate buy orders). This was done just yesterday as our President announced that OPEC and Russia had a deal to reduce oil output. Too bad just an hour later the Russian President said it was not true. Anyway, mission accomplished! Oil (WTI) had a record gain of over 24% in one day! Too bad this will do NOTHING to change the fact that because of the worldwide slowdown- now almost 2 YEARS OLD- not 2 months old the demand for oil, gas and many other resources remains dead low.

Traditionally, we can tell if a stock is cheap or expensive in many ways. One is the Price/ Earnings ratio. Basically, how long before I earn my investment money back based upon the price I am paying. How in the world can anyone value ANYTHING in an environment like this? All we know is that earnings for most companies are going to crater. The only question is “how far?” Many companies will likely not survive this. What does that mean?

Any money you have invested would likely be wiped out in a bankruptcy and cause a 100% loss. There is NO recovery from that. In addition, many companies are announcing an END to dividends for the time being. Can anyone tell me the allure of stocks are at this moment?

Personally, I believe stocks, bonds and real estate will be screaming buys- as soon as they correct (or overshoot) to fair value or less. That is likely FAR FAR lower than where we currently are.

I am amazed at how many people think the “market” is cheap just because it is 30% lower than it was. What is a company worth that may or may not survive, is cutting dividends, and can’t give any forward guidance because things are so uncertain, they can’t even guess what the future holds?

On the other side of the coin- you can only get gold and silver if you want to pay a premium to the fake paper price of 50-90% HIGHER than the daily quoted price. There is VERY little supply and overwhelming demand. The only way that the price is not skyrocketing- in the words of Dr. Paul Craig Roberts- is fraud.

As those who conjure up money out of nowhere also conjure up gold and silver paper contracts to give the illusion that someone “in the know” is selling the price is held artificially low. The last time this scheme blew up was in 1969 when gold was $35.00 per ounce (held there artificially). By 1980 gold was $850.00 per ounce. Look out when they lose control this time!

Just this week the COMEX and LBMA have had to come out and ASSURE the public that there is plenty of gold supply. Interesting that this is happening as mines are being shut down globally because of the virus and the same thing is happening with the refiners.

Finally, the FDIC is out there with advertisements letting all the depositors know that the FDIC is SAFE!

Call me a little paranoid but when those in charge have to let me know that I am safe it has generally been a good time to take note and worry at least a little bit.

There are MANY signs, in my opinion, that the economy that we had just a month ago is dead and buried. There will be MANY who will not return to work anytime soon- if ever.

Many small companies will not survive.

Anyone who is thinking that this will go away when the virus numbers start to fall is, I believe, being grossly misled. The economy has had a shock that may take decades to recover from. While that may sound over the top it just may be far too tame.

This appears to me to be similar to the great depression of the 1930s where stock prices took 25 years to get back to levels that were seen in 1929. By the way, Japan has a stock market that is 55% LESS than it was in 1989 TODAY- after conjuring up over $550 TRILLION YEN to support it!

If 2008 was allowed to play out and capitalism to do its job- cull the herd and let the strong companies survive and weak ones die- we would likely have markets that would be recovering right now. Instead, the hard days still lie ahead.

Hopefully, the episode will be swift and lead to a bottom where we can be somewhat assured of a lasting recovery that will be real rather than an illusion based upon ever-increasing debt.

This is NOT a drill. The issues that I have been warning about for years are finally upon us.

Be Prepared!

Fascism In America

Another day and another rollercoaster in the US stock “markets”. The market has one job- determine fair value with each and every trade. Since the central banks have become the buyers and lenders of last resort the “markets”, which have not been really free for decades are far more manipulated in every way than free.

For anyone worried about a democratic challenger don’t worry. I believe that President Trump has been the perfect guy for the Fed and their handlers as he has led us way past anything Bernie Sanders had in store for us and the majority of people still think we are practicing capitalism. We haven’t practiced true capitalism since prior to 1920. What is happening now, however, is unprecedented in our country’s history.

The best analogy I can come up with is Nazi Germany and pre-WW2 Italy where Fascism was the economic system of the day. It is like a public-private partnership where there are private owners but those “in charge” in either government or central banks call the shots. The “owners” can play along and get rich or be replaced.

As we speak the US Treasury and the Fed (A private corporation owned by 6 major banks) are executing a plan to conjure up “Unlimited Amounts” of dollars and buy assets. These assets include Stocks, US Treasuries, Muni Bonds, Corporate Bonds, ETFs, and probably anything else you can imagine.

It appears to me that at the end of the day the Fed (and Treasury) working in tandem will likely own the lion’s share of US businesses and will likely be calling all of the shots as they will control production, logistics, money supply, who gets support and who doesn’t.

Anyone who isn’t concerned by this should get some therapy. The government has virtually nationalized healthcare and the greatest healthcare system in the world has been reduced to a national disgrace as Healthcare CEOs become filthy rich while many regular people are bankrupted by skyrocketing costs not only for services but for insurance premiums also.

Infant mortality and the overall mortality rate of our country has been getting worse in the last few years also.

Colleges, Universities and the public-school system have been taken over by the government. Our world-class education system has been destroyed and our rankings in the world continue to plummet in subjects that are important like Reading, Math and Science. But everyone knows how to put a condom on a banana. This information won’t help when we have to compete with other countries that teach marketable skills instead of creating compliant little subjects.

What I am trying to point out here is that when government gets involved things don’t go well.

In Venezuela they are blessed with some of the richest oilfields in the world. The government took the sector over and kicked out corporations that knew what they were doing. Political hacks were put in charge and in a matter of years the entire infrastructure was failing and their main source of income was halted. Shortly thereafter one of the worst humanitarian crises I have ever seen took place- and continues today.

By the way, as the oil revenue fell the Venezuelan government “printed” money to pretend they could pay their bills. Inflation turned to hyperinflation and the nation was impoverished in a matter of months.

To date, they have not recovered and there appears to be no end in sight to their misery there.

This should be a cautionary tale to all of us here. YOU CANNOT GET SOMETHING FOR NOTHING. EVER.

The central banks can conjure up all the cash they want, buy all they can get their hands on and, in their case, they got “something for nothing”.

The sad part is, however, the former owner has been stripped of his ownership and rights while those who can conjure up money from nowhere “bought” the asset with a click of a button. The previous owner is financially destroyed along with his investors and the new owners move forward.

Does anyone else think this is grossly unfair or am I, as usual, just looking at the negative side?

Anyone who thinks these are really markets should ask a few questions like:

·How could “markets” stay elevated when 10 million people file for unemployment in 2 weeks?

· How can auto manufacturers stay elevated when Sales are crashing across the globe and here in the USA “US Auto Sales Plunge To Lowest In A Decade, But The Worst Is Yet To Come In Q2?

· How could, in a world in virtual lockdown, see oil prices rise even though at current production levels all storage may be full in a few weeks?

· How could Boeing be rallying even though it is offering buyouts to its entire workforce and doesn’t expect a rebound in business for YEARS?

· How does anyone expect things to just go back to normal after this episode? How many people do you know that will go to a crowded bar or restaurant after this? How long will it be before people will be comfortable enough to go to a sporting event- particularly indoors?

· How many people will be taking cruises in the next couple of years, or flying unnecessarily for that matter?

· How will retailers survive when they were struggling to start with, they have laid off, fired or furloughed most employees, don’t know when or if they will reopen, many have stopped paying rent, and they are faced with massive debts and unprecedented unemployment so the weak demand just may turn to no demand.

There are many other questions I could ask but we have economies across the globe in freefall, we are at historical levels of debt at every level of society, we are attempting to appear solvent by issuing trillions of dollars of new debt to prop up previously issued debt and continue unabated spending to bail out insolvent industries and families.

Again, does this sound like capitalism? This is some crazy mix of national socialism or fascism.

This is NOT the America I grew up in. Pretty soon you will all know this to be true. I don’t believe we will see in our lifetimes the economy that we had just a few weeks ago. There are many who may NEVER return to work. My guess is 10-15% of the jobs lost are lost permanently right now- if this ended today. We all know it is NOT ending today and may last another month or two.

The economic damage has been done. We were in a weakened financial state to start with and the virus just sped up our demise.

Conjuring up money is NOT the answer. At the end of the day, the “printers” print and buy- they own the assets and you and I own the debts. Talk about using other people’s money!

This exponential growth in “printing and buying” has led the world’s elite to purchase gold in record amounts in the past few years. They knew this was coming in one form or another. Today, it is nearly impossible to find physical gold or silver without paying a huge premium and having to wait weeks or months for delivery.

My opinion is that in a short period of time this illusion will be exposed and a reset of prices will take place that many will be stunned by. Judging by how fast events are unfolding I believe we are very near that time.

For anyone concerned about their current portfolio- particularly if you are being told “buy and hold” or “the market always goes up over time” consider giving me a call. This time IS different.

Be Prepared

Doug Casey

It's not like copper or aluminum or iron, where it's “consumed.” Gold is held, because its primary use is money. How much silver has been mined? In the Earth's crust, there's probably about 10-15 times more silver than there is gold. And that's reflected in the annual production figures: roughly 80 million ounces of gold, 800 million ounces of silver.

But if there are 6 billion ounces of gold above ground in inventory, there is nowhere near 10 times that amount of silver in inventory above ground. At this point, there are probably only about 2 billion ounces of silver in inventory. It used to be almost on par with gold as money, but that’s changed. Now it’s mainly a specialized industrial metal. So, it’s “consumed” in much the same way as copper or aluminum

Incidentally, the amount of silver in inventory is now less than it ever has been, because not so very long ago – up to 1965 – there used to be 2 billion ounces floating around in US coins alone. It’s also gone from photography, which consumed about half up to about 2000. Its price has held up surprisingly well, considering its two major uses have disappeared, and production keeps going up.

Anyway, coming back to the point on ratios, what should the ratio between gold and silver be? Right now, it's close to 100-1. So gold is expensive in terms of silver. Silver is cheap now; it’s an excellent speculation.

The interesting thing is that silver is a much, much smaller market than gold. And when the public gets manic in a monetary crisis, silver is much more volatile, since it's a much smaller market. People rush to buy gold and silver, which they think is one thing.

That's a good reason to be in silver right now, when the markets are weak and it's cheap. Another point that should be made is that almost all gold mines now are very profitable. In fact, production costs are dropping with the price of oil – which is a major cost.

But there are very few profitable standalone silver mines. It's mostly a byproduct of gold, copper, lead and zinc. So, if gold goes to $5,000 an ounce, which it will at some point, in terms of present dollars, there will be a lot more gold production.

But if silver goes to $100 an ounce, which I think it will, there won't be an awful lot of new silver production, because it's mainly dependent upon lead, zinc, copper, and gold production. So, I think the play right now is probably in silver.

That said, it takes so much silver to be of value that I do my saving in gold, not silver. To put it in as simple a way as possible: gold is for saving, silver is for speculation.

Egon von Greyerz

DON’T WAIT FOR THE STORM TO PASS – LEARN TO DANCE IN THE RAIN!

Whoever doesn’t learn to dance in the rain will struggle to survive the virtually non-stop storms that the world will experience in the next few years. The abrupt downturn in the global economy, triggered but not caused by coronavirus, came as a lightning bolt out of the blue. Thus, most people are paralyzed and will fall helplessly as the world unwinds 100 years of mismanagement and excesses, caused primarily by bankers, both central and commercial.

2006-9 WAS JUST A REHEARSAL

I have for years warned about the enormous risks in the financial system that inevitably would lead to a collapse. As the bubble continued to grow for over ten years since the 2006-9 crisis, very few understood that the last crisis was just a rehearsal with none of the underlying problems resolved. By printing and lending $140 trillion since 2006, the problem and risks weren’t just kicked down the road but made exponentially greater.

So here we are in the spring of 2020 with debts, unfunded liabilities and derivatives of around $2.5 quadrillion. This is a sum that is impossible to fathom but if we say that it is almost 30x global GDP, it gives us an idea what the world and central banks will have to grapple with in the next few years.

THERE WILL BE NO V OR U RECOVERY

No one should believe for one moment that once CV is gone, we will experience a V shaped recovery. There will be no V, there will be no U and nor will we see a hockey stick recovery. What few people understand, including the so-called experts, is that there will be no recovery at all. An extremely rapid decline of the world economy has just started and will be devastating in the next 6-12 months, whether CV ends soon or not.

CORONAVIRUS CASES EXPONENTIALLY HIGHER THAN RECORDED

There always had to be a catalyst to trigger the inevitable end to the biggest economic bubble in history. Catalysts are normally a financial event like a default of a financial institution. But this time the world could not have been hit by a worse event than Coronavirus. In just over one month the disease has spread like wildfire all around the world. Currently there are almost 900,000 identified cases and 43,000 deaths. The problem is that the number of cases are only a function of how many have been tested. Since most countries only have a limited number of test kits, the real figure of infected people is most probably exponentially higher than 900,000. CV was discovered in Wuhan back in November 2019. The disease most likely spread a lot faster around the world than anyone realized since no one was tested for a long time and still today very few are tested.

LOCKDOWN WILL BE DEVASTATING

The effects of CV have been to shut the world down for an unknown period. With schools, shops, hotels, airlines and factories etc. closed, most countries are not producing anything currently. This total lockdown will not only be devastating for the world economically. It could lead to more people suffering due to hardship, famine and health problems with lack of essential items like medicines and food, rather than from CV itself. I pointed this out already 3 weeks ago but politically and humanely this solution has not been considered acceptable.

What the world is now encountering is the perfect storm. That the debt infested global economy would one day come to an abrupt halt has been clear for a while as I have written in many articles. But instead of a gradual downturn, the world economy is now going to experience a fast and devastating collapse which will lead to a decline in real terms of most assets like stocks, property and debt by more than 90%. Real terms means measured in constant purchasing power like gold.

In the Dow for example, we have just seen on the quarterly chart, a downturn in the MACD indicator from a very high level. This is a very important trending signal which indicates that we are likely to see at least 10 years downtrend in stock markets. The alternative is that we will see a very rapid decline in the next 6-24 months and then the index going along the bottom for a decade or morex

UNLIMITED MONEY PRINTING HAS STARTED

Central banks around the world have so far committed $12 trillion of direct support via money printing. In addition, global fiscal stimulus or tax reductions of $5 trillion have been committed by governments. But these amounts are just a drop in the ocean. Just take a company like Volkswagen. They are now experiencing a cash drain of $2.2 billion per week. If we multiply that by factories and businesses around the world plus assistance to individuals, we will soon see liquidity requirements of $10s followed by $100s of trillions as the financial system implodes.

If we take the Fed as an example, it has cut rates to zero and already expanded its balance sheet by $700 billion to $5.5 trillion since September 2019. Another $2 trillion have been committed but that is just the start. Just to remind ourselves, during the 2006-9 crisis the Fed’s balance sheet only grew by $1.2 trillion to $2 trillion in 2009. We will most likely see the balance sheet grow by $ trillions in the next few weeks.

AFTER US THE FLOOD

Surging national debts and unlimited money printing has always been the inevitable end to periods of excesses. We are now seeing not only the end of a 100-year cycle since the Fed was created, but also the end of a 300-year cycle since John Law and the Mississippi Bubble in France in 1716-20. We could even be at the end of a 2,000-year cycle from the Roman Empire but that only future historians will know.

In 1757 France lost a war against Prussia. The French king Louis XV had a mistress called Mme de Pompadour. When France lost the war, she said to the king: “Après nous le déluge” – After us the flood, meaning that the loss of the war would mean chaos and destruction for France. And it did of course as 30 years later the French Revolution took place.

The situation is now the same, with Powell and Lagarde flooding the world with worthless money and the people virtually drowning. Many countries are likely to experience social unrest and possibly also revolutions.

TEXTBOOK END TO AN ECONOMIC ERA

The end of the current cycle is textbook. Bubbles everywhere, major problems in the global economy with economic and financial pressures plus a pandemic that has hit the whole world, all simultaneously.

Next come pressures in the currency system as all currencies are debased. They will all reach their intrinsic value of zero, but not quite at the same time, as central banks flood the world with unlimited amounts of money.

Hyperinflation will follow and then a collapse of the financial system as we know it today. No one must believe that SDRs (Special Drawing Rights) issued by the IMF will make any difference to a bankrupt system. SDRs are just a different form of paper money and a reset based on new SDRs issued will have a life of a few months maximum before it all collapses again. The next reset thereafter will be disorderly and dramatic as central banks lose total control.

THE EUROPEAN DISUNION – ED

Just a few words about the EU. It is no longer the European Union but the European Disunion – ED. All the illusions of grandeur have gone and each ED country is now fighting for its own survival. There is no coordination and no cross-border assistance in connection with Coronavirus. Italy, Spain and France are on the verge of collapse but are getting no aid from Germany. The European banking systems under massive pressure and will most probably fail or be seriously impaired in the next 6-12 months.

So, we are looking at a truly global crisis which will have irreparable repercussions for the world for a foreseeable future.

END OF PAPER GOLD MARKET NEAR

Another piece of the perfect storm is the physical gold market. The three largest gold refiners in the world closed down their factories a week ago. These three are based in the Canton of Ticino which is the Italian part of Switzerland.

They produce more than 50% of the gold bars in the world. These refiners are closed until further notice on the order of the local government in Ticino. This is due to the Coronavirus. Ticino is on the border to Italy and the majority of the workers are from Italy. The management of these refiners do not know when they can reopen and it could take a long time.

So, with physical gold demand being unprecedented and with very little supply or stocks available, we are very soon likely to see the physical and paper gold market going separate ways. Who would like to own even 1 ounce of paper gold when there is no physical supply and many hundred times more paper gold outstanding than available physical gold. The paper gold market can break at any time. If I owned paper gold or a gold ETF (which I naturally don’t) I would ask for delivery on Monday. The whole paper gold market is a total illusion like most markets today. There is zero underlying value. Time will very soon reveal that the paper gold market is just standing on a foundation of quicksand.

For anyone who doesn’t own physical gold, I suggest to acquire gold at virtually any price. You cannot buy physical gold at the paper gold price you see on the screen. You can of course buy unlimited paper gold at that price but that will soon have zero value. Our company is fortunate to still find physical gold for our clients but that situation will not last if the refiners don’t start producing soon.

To make it very clear, the screen price for gold bears no resemblance to reality. If you can get hold of gold buy it now without worrying about the markup. Silver is even worse. There is no physical silver available in large amounts. Whatever smaller amounts are available can fetch a 100% premium.

As the world is now entering the Dark Years that I wrote about many years ago, remember that the most important thing is helping family and friends as well as our health.

Egon von Greyerz

SRSrocco

GLOBAL SILVER SUPPLY COLLAPSE ON ITS WAY: Mexico mining suspension to hit silver supply

Due to Mexico’s Ministry of Health issuing an Executive Order for the immediate suspension of non-essential activities until April 30th, the mining industry in the country has now come to an abrupt halt. The mining industry was hoping for an exemption to the Executive Order, but was not granted one. So, companies are now suspending production and putting their mines on care and maintenance.

According to the article on the Mining Journal website, Mexico mining suspension to hit silver supply :

Under the government decree, non-essential activities are to be suspended immediately until April 30.

The decision is expected to have a significant impact on the supply of silver at a time when demand for silver coins is high. Mexico is the world’s largest silver producer at some 23% of world production and produced more than 200 million ounces in 2019 , up from 196.6 million ounces in 2018.

With Mexico shutting down its mines, including the continued closure of Peru’s Mining Industry announced on March 15th, nearly 40% of global silver production is offline. Peru’s government stated that the national quarantine would last 15 days. However, we have passed that point, and there is no announcement of a return back to work.

Here are the top ten silver producing countries in the world in 2018:

In 2018, Mexico and Peru accounted for 342 million oz of silver production. If mines in Mexico and Peru remain shut down for a month, that will cut silver production by 28 million oz. So, each month that Mexico and Peru are offline, would reduce silver mine supply by 28 million oz. However, I believe we are going to see more countries shut down their mines for an extended period as the global contagion continues to spread.

Today, Newmont and Pan American Silver announced closures of mines in Mexico. Newmont is now ramping down production at is massive Penasquito Mine, which produced 18 million ounces of silver in 2018:

Also, Pan American Silver announced the shutdown of its La Colorada and Dolores mines in Mexico. These two mines produced 13.3 million ounces of silver in 2019:

As we can see, the mining industry is now being shut down due to the global contagion. It will be interesting to see when Peru’s government announces a return to work policy. Again, it has been more than 15 days since Peru announced a national quarantine with no indication yet of a return to work.

With Mexico, the largest silver producing country in the world now on lockdown, the collapse of global silver mine supply is underway. The shutdown of silver mines throughout the world is taking place when investors are buying a record amount of physical silver bullion. This has now become a PERFECT STORM for the silver price going forward.

According to the article on the Mining Journal website, Mexico mining suspension to hit silver supply :

Under the government decree, non-essential activities are to be suspended immediately until April 30.

Here are the top ten silver producing countries in the world in 2018:

Today, Newmont and Pan American Silver announced closures of mines in Mexico. Newmont is now ramping down production at is massive Penasquito Mine, which produced 18 million ounces of silver in 2018:

Also, Pan American Silver announced the shutdown of its La Colorada and Dolores mines in Mexico. These two mines produced 13.3 million ounces of silver in 2019:

GLOBAL SILVER SUPPLY COLLAPSE ON ITS WAY: Mexico mining suspension to hit silver supply

According to the article on the Mining Journal website, Mexico mining suspension to hit silver supply :

Under the government decree, non-essential activities are to be suspended immediately until April 30.

Here are the top ten silver producing countries in the world in 2018:

Today, Newmont and Pan American Silver announced closures of mines in

Mexico. Newmont is now ramping down production at is massive Penasquito Mine, which produced 18 million ounces of silver in 2018:

Also, Pan American Silver announced the shutdown of its La Colorada and Dolores mines in Mexico. These two mines produced 13.3 million ounces of silver in 2019:

When The 6 Billion Dollar Gold Dealer Speaks, Hunter Listens (and Records. Here’s what he said…)

Hey there. This is Hunter Riley III, author of the world’s best selling gold and silver book called Stack Silver Get Gold.

Long time no talk.

Anything happen while I was gone?

LOL.

I did kind of tell you this craziness was coming almost two years ago specifically in this Miles Franklin newsletter post here.

That kind of prediction could give Nostradamus a run for his money and it’s also a reason to read and recommend this Miles Franklin newsletter to your friends and family.

Especially in today’s environment.

I’m sorry I haven’t kept in contact. I’ve been on a rampage riding around the equator and Southern Hemisphere.

Puerto Rico. Uruguay. Argentina.

In fact, I was in Buenos Aires in mid March just when this coronavirus craziness started picking up in the USA.

Sitting on my rooftop, drinking some high altitude Malbec wine with the Buenos Aires girls we were all discussing the virus but where to tango at 2am later that night was the bigger topic of conversation.

By the next day, things changed.

The government started to get nervous.

Americans weren’t exactly the most wanted of guests by the Argentine government since we were coming from an infected land.

New arrivals had to self quarantine for 14 days.

There was talk of shutting down all air traffic to North America.

Things happened very fast.

And all of the sudden I went from wine and tango talk with Argentinian girls to the US Embassy alerting all Americans to leave the country ASAP as they could not guarantee your safety or ability to freely return to the USA in the near future. They couldn’t even guarantee you could get to the airport and past street checkpoints!

I made it out on the second to last seat on the LAST flight before all air traffic was grounded.

The point of all this is that there is still time for you to get out before it's too late.

Get out of what?

Get out of this mess that Coronavirus seems to have accelerated by shutting down the world economy for an extended period of time.

The mess of government gone wild in their world of monetized debt.

Unlimited money printing and deficits to the tune of trillions of dollars.

So how can you still get out?

Buy precious metals.

Specifically gold and silver, although I like silver a lot more than gold which you’ll learn why by watching the video interview I’m going to tell you about now.

When I got back and settled, I called up the boss of Miles Franklin, Andy Schectman and asked him what he thought about the current state of the market.

Andy has sold more than 6 BILLION DOLLARS of gold and silver.

He is in constant contact with the most important people in the precious metals industry.

If there is anyone to talk to about this, it's Andy.

So that's what I did.

And I recorded it all for you to watch.

You can watch the full 39 minute interview here right now.

In this interview below, you’ll learn….

**The Big Difference Between the 2008 and 2020 market Crashes

**The Silver/Gold Ratio, Why It's Important and What You Should Be Buying For the Biggest Value

**The Most Significant Event of Andy’s 30 Year Precious Metal Career and Why It Matters To You

**Comex Implosion and What It Means for People Who hold Physical Gold Instead of ETF’s

**Why Buying Precious Metals From Minnesota is the Safest Way in the World

**How to Get the Lowest Advertised Price on Precious Metals in the Country….

Click on the video below to watch it now.

As this pandemic starts to “peak” remember what Sir Winston Churchill once said…..

“If you’re going through hell, keep going.”

Don’t let the doom and gloom news get you down.

We started off a little slow but we’re gonna defeat this lame coronavirus.

No doubt about it.

However we might have overplayed our hand in the long run with all of the trillions of dollars in stimulus the FED is creating.

I would change up Sir Winston’s quote ever so slightly.

“If you’re going through hell, keep going…..and bring some gold with you.”

Hang in there.

I’ll talk to you soon since I no longer have any Buenos Aires girls around to distract me.

Hunter Riley III

Chicago, IL

April 2, 2020

***Hunter is author of the #1 best selling gold and silver book on Amazon called “Stack Silver Get Gold: How To Buy Gold And Silver Bullion Without Getting Ripped Off!”

Market Report

Archived Newsletters

4/2 This is Not an April Fools Issue... I Have Never Been More Serious.

3/31 Hammers and Nails and Golden Vaccines

3/25 Inflation is Baked into our Future. $3,000-$4,000 Gold Looks to be Way Low.

3/24 Consequences, Crashes and Coronavirus

3/20 You Will Not Understand the Future, this Time... if You Try and Understand it by Looking at the Past.

3/18 The Four Horsemen of the Apocalypse Hate Silver

3/17 Costco is a Perfect Snapshot in Time that Illustrates What is Happening.

3/13 The Corona Virus was the Needle That Pricked the Bubble.

3/12 The Virus is Not the Cause – The Coronavirus Just Lit the Fuse.

3/10 Silver – Left Behind Today, But Not Tomorrow

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About Miles Franklin

Miles Franklin was founded in January, 1990 by David MILES Schectman. David's son, Andy Schectman, our CEO, joined Miles Franklin in 1991. Miles Franklin's primary focus from 1990 through 1998 was the Swiss Annuity and we were one of the two top firms in the industry. In November, 2000, we decided to de-emphasize our focus on off-shore investing and moved primarily into gold and silver, which we felt were about to enter into a long-term bull market cycle. Our timing and our new direction proved to be the right thing to do.

We are rated A+ by the BBB with zero complaints on our record. We are recommended by many prominent newsletter writers including Doug Casey, Jim Sinclair, David Morgan, Future Money Trends and the SGT Report.

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