If we don't change course, we may end up where we are heading
Johnny Silver Bear

I was asked by a friend this week, how I thought the markets would perform this year. Well as Yogi Berra put it: "It's hard to make predictions, especially about the future". I'm going to go out on a limb and suggest that 2016 will be the year that the sheeple finally begin to lose confidence in the financial system and view the Central Banksters of the world for what they are; Bozos, and that they are the cause and not the effect of everything wrong with the global economy. This realization will be predicated by higher bond yields and a noticeable increase in the rate of inflation. Meanwhile the VIX (Volatility Index, a popular measure of the implied volatility of S&P 500 index) is very close to five year lows. This expresses lackadaisical sentiment of the part of investors, which is a very strong contrarian indicator. Get ready, 'cause here it comes...

If there is anyone out there that still believes the tripe that is spewed by the mainstream media, concerning the robust recovery we are all supposably experiencing, please take off your blinders and pull your head out of the sand. To suggest that the economic demise of America is being intentionally orchestrated by a bunch of megalomaniacal morons my seem a bit conspiratorial. But that is simply because it is.

The state of the nation is bad and getting worse. Seventy five percent of Americans polled (by the Pew Research Center) don't trust the Government, and yet, we do nothing to stop the theft, greed and corruption that that has been, and continues to be, wrecking the economy. Fifty percent of Americans are one crisis away from financial failure. The present administrations solution is to put everyone on welfare. How can that work? We are being lied to, minute by minute. The stock market is being held up by the Federal Reserve's printing of counterfeit money and fairy dust

How can the Fed keep buying treasury paper, which allows the Government to keep on borrowing? While I realize that keeping the bond market inflated is the primary aim of the Central Bankers, (the Fed), to what lengths will they go to do so? What new legislation will they dream up for their puppet politicians to pass? If it never occurred to you that the Federal Reserve, (a private corporation), owns the U.S. Government, please read the following statement made by former Fed Governor Ben Bernanke.

"By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation."

What in blazes is positive inflation? And why would anyone, representing the people, want the price of goods and services to rise? Who, but a banker could benefit from inflation? Inflation equals rising prices. Rising prices equal more loans. More loans equal more interest. The natural evolution of man would have provided for a continuing improvement in the standard of life for all persons, if it wasn't for the heinous contrivance called inflation. Technology has provided new and improved ways to produce and deliver almost everything. Without inflation almost everything would be cheaper, or at least remain the same price. Let me restate that last part. If it wasn't for the Federal Reserve, everything would become cheaper, instead of more expensive. Most people believe that inflation is a natural economic occurrence. This is simply untrue.

The Federal Reserve is out of bullets. They are about to, finally, hit the wall. Next week or next month, interest rates will be forced up by a collapsing bond market, inflation will start to be realized with abandon, and deflation will finally raise its ugly head as all the bubbles pop at once. Inflation and deflation at the same time? Actually the inflation has already occurred and has been masked by the unwillingness of the banksters to lend out the trillions of counterfeit dollars the they were gifted by the Fed. It's a train wreck that happened eight years ago that just wasn't covered by the Government controlled presstitutes.

As I have mentioned, many times before, there is a war being waged on the American Middle Class by those who would be kings. The, so called, benefits of our democratic society have been ingrained in us since birth. The concept of democracy is comforting to most of us. It seems to instill a feeling of security and freedom. Consequently, if the majority ruled, we would all be forced to live like the majority. Simple-mindedly. The majority, which includes our august body of politicians (LOL) is made up of clueless sheeple who believe in "something for nothing". There is no such thing.

Fortunately, the Founders did not think like the majority. If the majority had ruled, we would have never had a revolution. The Founders were part of a very small minority and did not establish our government as a democracy. In fact, the only references to democracy in the founding documents of our nation were purveyed in a very negative light.

Liberty is the concept on which our county was founded. Liberty is the only thing that insures our freedom. The Constitution and its first ten Amendments, (the Bill of Rights), provided for our liberties and therefore our freedom. Attempts by "the Dark Side" to subjugate the Constitution, (i.e..., the Federal Reserve Act, the Patriot Acts I and II, and any other legislation that tends to abort Constitutional mandates), have been veiled attempts to strip our liberties and therefore our freedom. Consider that in the past, we had Liberty coins, not Democracy coins. We have the Statue of Liberty, not the Statue of Democracy. We pledge allegiance to the flag, and to the Republic for which it stands, not the democracy for which it stands. Patrick Henry said: "Give me Liberty or give me death!", not "Give me democracy or give me death".

Our present state of affairs has ushered in a total breakdown in all branches of government. Currently, the most glaring example of this condition is provided by the absolute failure of justice system's regulatory agencies to perform their legal functions. If all the criminal politicians in Washington, and all the criminal banksters in New York City died tomorrow, there would be thousands of empty parking places (a good thing) and the world would be a much better and safer place.

The current gold to silver ratio is 76 ounces of silver equals one ounce of gold. One of the most blaringly attractive arbitrage plays ever known to man, would involve this ratio. Silver is quite a bit rarer than gold, a condition that is a result of the industrial destruction of billions of ounces of silver since 1947. Nobody seems know. Nobody seems care. The knowledge of this condition would threaten (fatally) the Darkside and their slobbering minions. You need to know. You need to be aware of the Gold/Silver Ratio. It has historically been 16/1. I believe it will be much lower than that in the near future.

From Dr. Alex Cowie:

Now you’ll sometimes hear that if you took all the gold bullion in the world, and melted it into a single cube, this would measure just 23 metres on each side. To use a timely illustration, it means that all of the world’s gold would fit on two tennis courts.

That shows you very nicely just how rare gold actually is. A big part of why gold is so valuable is due to this level of scarcity.

So…how does silver stack up in these terms?

The answer is surprising. Because the world’s silver bullion would fit in a cube measuring just 17.9 metres on each side. In other words the silver cube would be significantly smaller than the gold cube.

And I’m being generous here, using the largest estimate of the total investible silver bullion I would trust. According to CPM Group, the total global inventory for silver bullion is 1.9 billion ounces. This includes 711moz in futures exchanges, 38moz government stocks, 941moz in coin form and the rest in inferred & unreported private holdings.

Many analysts are less generous, and most work on the basis of just one billion ounces of silver. That would equate to a cube just 14.4 metres on each side!

But I’ll stick to the CPM figure for now. You don’t need to cherry pick to show just how rare silver bullion really is.

Here’s a representation of that 17.9 metres cube for you (using the 1.9 billion ounces of silver number), stacked up against the world’s gold cube.

‘Global gold cube’ Vs ‘Global silver cube’ – SILVER IS MUCH RARER

Source: Diggers and Drillers

As you can clearly see – there’s not much silver kicking around.

So here’s a thought: When there is clearly far less silver bullion in circulation than gold… then why is silver 53 times cheaper than gold?

I admit this is comparing apples and oranges to a degree. They are different markets and have different fundamentals.

But the core reason for the different price is that gold is primarily an investors metal, be it punter, hedge fund or central bank – they are buying for its investment qualities.

Whereas silver has long been an industrial metal, with a few investors making up a portion of purchases.

But this is changing.

As recently as 2007, investment demand was just 5% of the market.

By 2015 investment demand was 30% of the market.

Source: srsroccoreport.com

And this is where China comes in.

Chinese precious metals demand has exploded recently.

All the press focus on the gold side of the story, as China’s hunger for gold means it’s now the main player in the market. That’s what happens when an economy grows in size five-fold in a decade, and gold ownership becomes legal (and encouraged) along the way!

The availability of inexpensive fossil fuels currently determines the quality of life for the whole planet. There are those who recognize that the standard of their lives will require depriving many from access to these fuel pools. That deprivation will come in the form of pricing and tariffs. One of the convoluted aspects of this situation is the concurrent stifling of any alternatives. Regular readers have come to find the many sources of energy that have been bought and shelved by the powers that be. One can't help but wondering whether or not depopulation plays a part on the Darkside's agenda.

You must first realize that there are, present in our lives, enemies. You must then know who those enemies are and act accordingly.

Eliminate as much debt as possible, especially “variable rate” debt, such as credit cards and lines of credit. Interest rates will be rising, so the elimination of debt offers a “real return” of escaping rising rates by creditors.

Get some control over some fresh water.

If you are depending on Social Security, stop.

Follow the course opposite to custom and you will almost always do well...

Its not what you don't know that will screw you up, it's what you know that is wrong. The spin you hear from the mainstream media is intended to mislead you. Open your eyes and face the future. If you leave your head in the sand and ignore it, you are only leaving your butt exposed for the world to kick. This all may sound like gloom and doom, but when you get a handle on what is going to happen, you will have a future filled with opportunity. Fortune favors the Informed.

More next week...

May the Great Spirit be with you always,

Johnny Silver Bear
Chief cook and bottle washer, The Silver Bear Cafe

Kenneth Parsons, aka Johnny Silver Bear, is an IT professional in Texas and the President of Silver Bear Communications, Inc. Mr. Parsons has been involved in the advertising and promotion industry for over twenty-five years. He is the editor of the Silver Bear Cafe and, as such, is responsible for shaping the content of "The Bear". Mr. Parsons has served as CEO for Fiberscape Communications, Inc., a web site development / hosting and streaming multi-media company in Richardson, Texas since 1997. He is a Jeffersonian and a passionate supporter of the U.S. Constitution. He is also an outspoken advocate of gold money and equal tax rates. You can contact Mr. Parsons with questions or comments via email at [email protected]