The debt market is currently stable. 10 year yields in the USA settled last week below 3%. We should expect yields to weaken further as the current fear trade, forces cash to move out of stocks into the perceived “safety” of the debt market.
As we already know, for precious metals, the driver of price is the derivatives paper market. That is, the paper prices on the futures markets on COMEX. Not physical supply and demand. So this market does not allow fair value price discovery.
But what of the stock markets generally? What is the key driver of value? Is there fair value price discovery? It would appear that the key driver of the stock markets are no longer fundamentals such as earnings, forward guidance or PE ratios. There is no longer ANY correlation between the real economy and the stock markets. Once you see and understand this paradigm, its a lot easier to see what is really going on here.
On a macro level, we see a global takeover using controlled governments who answer to central banks. The central banks are the de-facto governments. The agenda is an expansion of a control, and in the process eliminating smaller players, including the middle classes.
Since QE started in 2008, there has been huge asset purchases by the central banks, via massive debt expansion. As a result, the stock market has gone up, tracking the central banks balance sheets and the M2 money supply. By manipulating the debt market, the central banks have successfully re-inflated the stock and real estate markets. As a result, these markets cannot determine fair value. A real market needs both buyers and sellers to agree what is fair value for an asset, but when you have central banks manipulating debt on a massive scale, that mechanism is broken.
Because of this massive manipulation of debt by central banks, the stock market driver becomes primarily one thing: DEBT. So today, stocks have been morphed by central banks into derivatives. Stocks now derive value from action in the debt market, which is currently stable. A debt market meltdown needs to happen FIRST. But there is no evidence of that yet.
This should help to explain why I continue to bet against the central banks, by staying long precious metals stocks, long uranium stocks and yes, crypto! As when the debt markets implode, capital is going to move out of stocks, out of the debt market, out of real estate, and into commodities, precious metals and yes, crypto.
It is entirely possible, we may see new highs in all asset classes including equities, before the debt market implodes. They will want to get the maximum number buying into the highs, before they make their final big move on the debt market. Nothing is by chance. This is ALL being manipulated. Just as they did with COVID.
This is the strategy, whilst waiting for the big one, which will start in the debt markets.
This is not it.