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May
03
2022

Stating The Obvious!
Bill Holter

For many years I have written articles with charts, graphs, data, etc. to connect dots and come to a conclusion.  Many topics were complicated and we tried to simplify for the average reader to understand.  Occasionally we wrote opinion pieces, but for the most part the articles contained proven facts that when accompanied by other factual data could lead to logical conclusions.  This article could be considered an opinion piece as I do not care to footnote or prove anything I say.  You can either believe I am correct or not.  I write this because I would like to be on the record one last time.  Let me start with the conclusion: our way of life is over!  No matter who you are, how wealthy or connected, your life will change dramatically and will certainly become more difficult going forward.  Interest rates have exploded on a percentage basis from the lows over the last couple of years (which had been in place for many years).  Another way of saying this bluntly is that bond markets have crashed.  Some will say “so what”, few understand.  Credit has become THE foundation for both the financial system and real economy.  The foundation used to be gold and silver, now it consists entirely of promises to pay.  As interest rates rise and bond prices collapse, the “foundation” is being hollowed out.

Stocks have been hit pretty hard, even some of the “generals” that held the indices up for so many years are beginning to falter.  We even have some indices like the Russell already making 52 week lows.  We also see the sales volume in real estate beginning to dry up.  In case you have forgotten, “price ALWAYS follows volume”.  Mortgage rates were 2.75% just a year ago, now they are 5.4%, twice as high!  If you have not made the connection, a doubling of interest rates basically means a halving of what someone’s income qualifies to borrow.  In other words, for those who need to borrow to purchase real estate, their purchasing power just dropped 50%.

We were laughed at and maligned for many years and still somewhat today by those who refuse to pull their head out of their ass to see real world happenings.  A short but devastating list of real world happenings where little to no debate is needed; inflation of nearly every single good or service we need to live, deflation of assets has already begun but most importantly of bond prices, we are on the cusp of WWIII as the west seems hell bent for conflict (to point at as the reason for economic and financial failure?), central banks and sovereign treasuries have destroyed their own balance sheets and own failed/failing paper or owe more than can ever be repaid, market liquidity at extremely low levels even though tens of trillions have been pumped into the system, moral and ethical decay as never seen before, work ethic has never been lower, knowledge of basic survival skills has become lost.  Hell, a good part of the country cannot (or refuses to) define the difference between male and female!?  It has gotten so bad that the current administration feels the need to establish a “ministry of truth” to silence (punish?) anyone with differing albeit truthful and realistic views.

Volatility in markets has exploded because liquidity seems to be drying up and credit more difficult to come by.  If you are a student of history, then you’ll know that prior to every single market panic, volatility exploded before the event was understood by the vast majority.  This is exactly where we are now in my opinion.  Do we get a bounce from here?  I do not know and will tell you it does not matter because this “credit cake” has already been baked and in the process of burning to a crisp!  Of course, a .50 basis point rate hike by the Fed going into recession should solve ALL the problems?

To conclude, I believe you should either blissfully enjoy the precious little time left in fantasyland or, prepare for the sudden impact that is mathematically coming.  In my mind, it is not if but when …and only a matter of how bad it will get?  Do we go Mad Max?  In late 2006, a Mad Max scenario was not an odds on favorite because society was not as fractured as it is today.  Now that drag queen shows and so many other perversions are promoted by those paid by tax dollars to babysit our children, the fabric has already been torn.  Not to mention the concerted efforts to cancel The Constitution of the United States?  You can either believe the current fantasyland is normal and will continue throughout your lifetime, or you can believe that things real ..are, well, real?  Maybe it would be easier to be ignorant and blissful?  I guess it would be until it’s not?  But then of course it is too late, I suppose you can always show up on your crazy friend’s/relative’s doorstep and hope they forgot you consistently called them an idiot and prepared enough for you both?  It is here, it is now, and nothing you do will prevent it.  Your only alternative is to do your best to prepare …NOW!

Standing a fearful watch,

Bill Holter

Holter-Sinclair collaboration

Bill Holter writes and is partnered with Jim Sinclair at the newly formed Holter/Sinclair collaboration. Prior, he wrote for Miles Franklin from 2012-15. Bill worked as a retail stockbroker for 23 years, including 12 as a branch manager at A.G. Edwards. He left Wall Street in late 2006 to avoid potential liabilities related to management of paper assets as he foresaw the Great Financial crisis coming. In retirement he and his family moved to Costa Rica where he lived until 2011 when he moved back to the United States. He was a well-known contributor to the Gold Anti-Trust Action Committee (GATA) commentaries from 2007-present. Bill has retained a working relationship with Miles Franklin and can help with any of your precious metals needs including storage. He can be reached at [email protected]

 

 

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