China Just Turned the Currency War Nuclear-Andy Hoffman
By Greg Hunter’s USAWatchdog.com
Financial writer Andy Hoffman wrote an article titled “Upcoming, Cataclysmic, financial Big Bang to End all Big Bangs,” and the very next day, China devalues its currency by a massive amount. What’s going on? Hoffman says, “A year from now, we are going to be 5% lower (on the yuan) not 2%. So, already the market is bidding down the yuan in what I believe must happen. For all the talk about bubbles here, the NASDAQ bubble, the debt bubble, the housing bubble, bubbles we see in Europe, the bubbles we see in Japan and, frankly, nothing even compares to China’s bubble both economically and financially because of what their communist government has wrought onto them. I think there are going to be further steps for China to devalue as their economy falls apart.”
So, if China is devaluing its currency, does that means everybody else will eventually follow? Hoffman says you bet and says this is why there is the huge demand for physical precious metals and goes on to explain, “because it’s real money people are flocking into. They sense the fear between Greece, Brazil, China, Japan and now our economy that everyone is going to competitively devalue. The Fed raising rates, of course not. They are going to be doing QE4 and negative interest rates. The White House has been saying this year that the strong dollar is killing us, and there is an election next year. The earnings of the S&P are down this year and the economy is falling apart. The strong dollar kills corporate earnings and kills competitiveness. So, the Fed is going to keep weakening the currency. They will do a QE4 . . . sooner rather than later. Everyone knows it is real money you need to own, not this paper stuff as we are going into the final currency war.”
Hoffman, who also has 15 years’ experience as a Wall Street analyst, says it’s not just China’s economy tanking. It’s global as Hoffman explains, “We are at the single worst point of economic activity in the world in our lifetimes. You would have to go back to the depression to have a point this bad. Back then, we didn’t have any debt in the world. Now, it’s massive debt with no more room to add to it. We also have massive overcapacity of everything imaginable. . . . This is the scariest time I’ve ever seen economically and financially, and I think the whole world is going to know it soon . . . China devalues the yuan starting the end game. . . . It is currency collapse. Back in January of 2013, I said in the final currency war, everyone would devalue their currency to the point of hyperinflation. . . . Japan is going to be the first world society to have hyperinflation, and everyone will follow suit just like the prior 600 fiat currencies in history that all failed. Only this time, it is on a global scale without a single currency backed by anything except the faith and credit of central banks.”
On the Fed raising interest rates this fall, Hoffman says forget it, and explains, “The Fed is the biggest leveraged hedge fund in history. They have a $4.5 trillion bond portfolio . . . why would they be raising rates? They were lying all along. . . . Now, with this announcement by China where China is joining the currency war–no way. The U.S. is going to be forced to devalue its currency soon.”
So, what is the real Wall Street end game? Hoffman says, “They know the end game is going to be about gold and real money. . . . It’s not about financial markets, it’s about real items of value. It’s hard to dispute the fact that the perfect storm is coming together right now, including the front running of this gold and silver trade. China just turned the currency war nuclear . . . . It’s just hard to see how we get through this year without something gigantic and horrible happening.”
Join Greg Hunter as he goes One-on-One with Andy Hoffman, Marketing Director of Miles Franklin Precious Metals and Global Investment Strategies.
(There is much more in the video interview.)
After the Interview:
Andy Hoffman is a prolific writer at MilesFranklin.com. He writes almost every day of the work week. If you would like to follow his analysis and market perspective, you can do so for free by clicking here. There is also plenty of other free information and analysis on the home page.
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About the Author
Greg Hunter
Greg is the producer and creator of USAWatchdog.com. The site’s slogan is “analyzing the news to give you a clear picture of what’s really going on.” The site will keep an eye on the government, your financial interests and cut through the media spin. USAWatchdog.com is neither Democrat nor Republican, Liberal or Conservative. Before creating and producing the site, Greg spent nearly 9 years as a network and investigative correspondent. He worked for ABC News and Good Morning America for nearly 6 years. Most recently, Greg worked for CNN for shows such as Paula Zahn Now, American Morning and various CNN business shows.
If the Hang Seng collapses, and the China has more than the reported 600 Tons of gold, (more like the reported 50,000 tons) and then goes to a gold standard, what happens to US Dollar and economy?
I think our standard of living will drop 50% because we will not have anything of substance to exchange for chinese goods. So we will have to manufacture our own goods at a cost of more than double. In the long run it will be good because we will have to back to mining, farming, and manufacturing to supply our needs (or perish). Banking will almost cease to exist on the massive scale it is currently.
I would propose that with everyone falling over themselves to undercut their competitors in a currency war, the likelihood of exposing one’s true (vast) gold reserves would be very tiny, for a gold backed currency would undoubtedly strengthen as a safe haven would it not? The US dollar has the knee jerk safe haven response, but once it’s reserve status is challenged and it’s massive debt examined, it becomes a riskier play IMHO.
Nothing because 50% of China’s market is selling into the USA. So if they peg to gold they can no longer manipulate their currency like they just did. Ever hear a communist say they’d rather let the market control something?
If it ever comes down to China saying that “we’ll show you ours if you show us yours”, and we continue to refuse Ft Knox, West Point and NYFed audits, the US, as a nation, would almost immediately become a Banana Republic, losing all faith and credibility, and the stagflation, or perhaps hyperinflation would become a decades long reality, impoverishing all of the 99%.
Within the next year, and perhaps much sooner the USD will have to be devalued in stages; at first perhaps by 30% and then by another 30%. Gold and silver will spike accordingly and much greater than the 30%.
With or without the financial cataclysm most USAWatchdog participants anticipate, we are working our way back inexorably toward a standard of living more akin to the ’30s than the ’80s. We simply cannot afford ourselves anymore. Government’s enormous footprint and intrusion have distorted, perhaps even ruined, everything that made America exceptional. Top-down never works long-term. King George learned that the hard way, and now we have forgotten where we came from. Best always. PM
Andy doesn’t know what he’s talking it’s the same wall St analysts who have been saying things for a while how the dollar is
Strong ,China economy will collapse.I say nonsense the east is very wise and very clever .the us economy owes 19T dollars external debt. With a Fiat dollar. All China debts is internal with over 50T of AU az colateral for a now gold standard yuan. The USA have no gold. Yet it’s dollar currency is all time high than major currencies. Soo is that a real economy? Nooo. China knows that. Soo it devalue it’s gold standard yuan against a unbacked us dollar to attract investments and trade. If you were an investor were would you put your own money ,in an unbacked currency.heavily indebted or gold back .no external debt and low cost?
Sooo. This wall St analysts like Andy Hoffman needs to listen to a guy like Jim Willie.
Paul,
Andy does know what he’s talking about and has a body of work to prove it at Milesfranklin.com.
Greg
I have a question. China is buying large amounts of Gold and Silver. Could China be deliberately destroying their currency and stock market to pull all the other nations currency and stock markets down and eventually create a crash? They then can use their large amounts of Gold and Silver to continue business as usual. Gold will rise and they’ll have more money as ever? Just a thought. Appreciate all that you do. I come to your site to calm my fears about the future of America and the world. SP
Greg,
Andy Hoffman does NOT disappoint ! What a clear picture and basic confirmation of many voices. The final phases of Currency Wars and Gold Mines to be nationalized – rings the bell loud and clear. I was really impressed; as I noticed you were too.
Charles, Greg
I wasn’t impressed with this Andy’s comment;
“For all the talk about bubbles here, the NASDAQ bubble, the debt bubble, the housing bubble, bubbles we see in Europe, the bubbles we see in Japan and, frankly, nothing even compares to China’s bubble both economically and financially because of what their communist government has wrought onto them”.
Where does Andy get his info from?
Frankly this statement put me right off the remainder of the interview.
#1 Last time I looked US Federal debt was over US$18 trillion.
This works out to $56,000 per citizen..
Chinas government debt per citizen works out to be US $4000 per citizen.
In simple terms each US citizen owes 14 times as much as his or her Chinese counterpart.
If you want to look at total debt in the US including entitlements, and believe me most of you don’t, then the statistic is infinitely worse. You would have to multiply the 56K by a factor of 12.
When it comes to a debt contest China is an absolute beginner compared to the US.
#2 The projected GDP growth of China has been spun by MSM as “plummeting”
It has ‘plummeted’ to 7% a figure that every large country in the world could only dream about let alone even try to achieve.
Furthermore China’s GDP when analysed is clearly generated by a busy export based and wealth creating economy.
The US GDP growth will be lucky to hit 2% in spite of all manner of creative accounting. What’s more the US economy is based largely on consumerism and a gigantic military machine, neither of which create any meaningful wealth whatsoever.
#3 The bubble in the Chinese stock market needs to be kept in perspective.
Much of their stock market growth was fueled by investment of disposable income by ‘Joe Blow’ citizen, this very often being novice investment as well. In my view the recent downturn has been more about correction and nervousness on the part of these new perhaps transitory investors rather than any disastrous bubble.
This compares to the US where a good deal of the recent ludicrous stock price rally has been driven by institutional buyers and in particular with “buy backs”. These buybacks are driven by QE and funded by money being created out of thin air by banksters.
The US scenario looks much like meeting the definition of a bubble than China’s from where I am standing.
#4 China’s foreign exchange reserves June 2015 US$3.75 trillion
US’s reserves June 2015 $120 billion
Yes that’s right Chinas reserves are 31 times those of the US
Not much of a contest here either.
#5 Lastly but definitely not least consider the sovereign gold holdings of the US and China.
My research suggests that China has somewhere between 20,000 and 50,000 tons.
Personally I am very suspicious that the US has in fact no sovereign gold. IMHO a far more likely scenario is that they owe a vast quantity and are basically in an arrears position owing hundreds, if not thousands, of tons.
I have too say that I am both astonished and disappointed that no fellow commentors pulled Andy up on this one. I consider this to be one of the most blatantly self indulgent statements ever to come out of a WD interview.
Cheers
Col
‘
Maybe the point that Mr. Hoffman eludes to is that the US bubble is the bubble of last resort and will pop only when the rest of the world finds within itself the will to organize, form ranks, suit up, mount the steed and slay the dragon; until then the US federal reserve will simply continue to arbitrarily, indirectly and ever more indiscreetly pillage the rest of the world (and ever increasingly its own subjects) through its capital sucking policies and controls.
As far as China’s bubble, perhaps the levers available to them in order to maintain their own unrealistic economy afloat are too limited and as such are showing themselves unable to maintain such an unsubstantiated position without drastic overt actions, the likes of which typically lead to massive civil unrest and a desperate attempt to export such domestic discontent outside its borders through a sundry of equally unpleasant methods and means.
Colin,
China’s gold holdings? Let’s say 25,000 tons, more or less.
Chinese Stock Market – I agree, just a reasonable correction.
Chinese Debt – one fifth that of the US.
China un-pegging the Yuan to Dollar, and big explosion in Tianjin: do you think this is coincidence?
We are mostly in agreement. I don’t completely endorse Andy Hoffman – but did like the interview.
Charles
20,000 tons….25,000 tons …..sounds like one hell of a lot of gold to me.
Chinese debt.
Maybe you are talking just total Govt debt not per capita Govt debt.
The Chinese population is roughly 4.2 times that of the US..
4.2 multiplied by your figure of one fifth would give per capita US debt as more than 20x that of a Chinese Citizen.
Either way 15x /20x it proves the Chinese are minnows when it comes to borrowing.
Maybe my maths is wrong – its quite awhile ago that I went to school!
My gut feeling is there is no connection between the Tianjin explosion and the “unpegging”.
My understanding is that China has merely switched to a more market orientated way of setting the value of their yuan.
I don’t believe they were pegged to the US $ but rather a group of major currencies. It looks to me like they have just fine tuned their system to allow for a mix of factors including the below;
➢ The previous days close
➢ Foreign exchange supply and demand
➢ Calculation of a reference rate based on a number of major currencies
The yuan is allowed to fluctuate within 2% on either side of this reterence rate. The net for the week has ended up 1.5% devaluation after Friday’s revaluation of 5 basis points.
My call only, but I see this sort of reaction as just another instance that the West’s sheepism and self-indulgence seizes on in their favourite hobby, which is to indulge completely at every opportunity in China and Russiaphobia.
It is sad for me to see this sort of behaviour on WD and it is all the more poignant when I happen to be reading this very weekend the “The Sleepwalkers – how Europe went to war in 1914” by Historian Chris Clark.
Great title but it wasn’t just Europe that went to war was it?
With these sorts of phobias that are so rampant in so much of our western culture you cannot help but draw parallels between 1914 and 2015.
What is even more alarming is that apparently highly educated and informed people still don’t get it. I am like a lot of the rest of the world now. I fear for my family’s lives, not because of Russia or China or Iraq or Syria or any of these other countries that are continually villainized by the MSM. It is Washington that scares the crap out of me.
I watched the presidential debate the other day and this scared the hell out of me even more. Rand Paul is the only candidate out of the twelve that ‘gets it’. Because he “gets it” I predict he will never make it to the big house.
Every other candidate apparently wants to increase the military machine and kick even more sand in the faces of the whole globe. Even the brain-surgeon didn’t appear to have a clue. Huckabee had some intelligent things to say but still wanted to increase the military.
Hope you have a great weekend Charles.
Cheers
Col
Col,
The movement by the PBOC does not reflect a move to a more open / transparent system for their currency. “Market oriented way of setting the value of the YUAN ” is not the equivalent of unpegging the currency. It is still fixed/pegged to the USD. The PBOC of China simply just did a devaluation by weakening the peg against the USD. This is not financial warfare directed at the US…it is JAPAN that has taken the lions share of the world trade because of their currency devaluation. China VS Japan. That’s it.
SIG
I respectfully disagree when you claim that the yuan is “fixed/pegged to the USD.
Google it, you will find what I say is fact.
The yuan is pegged to a group of currencies. For that reason I actually agree with you when you say….” This is not financial warfare directed at the US”
All good we agree and disagree…. nothing like good robust debate!
Cheers
Col
Thanks Col,
Just like the “London” FIX…..the YUAN remains…. FIXED/PEGGED….and still under the control of the STATE. There is nothing about the currency that is akin to it being a Floating currency. Can you imagine what would happen in financial markets if it were ? I am reminded of the decades of incessant (US) political jibes and antagonism directed at the Chinese about the Yuan’s weakness and the “unfair” advantage they had/have over the USA (VERY Weak Yuan/ Strong Dollar). Market forces would have corrected that advantage and burned China to the ground long time past. Instead China has flourished and yet another monster has been created with which the Elite can push the world around and bully.
Yes the yuan is not peggef to the US dollar it’s pegged to a basket of currencies. In the imf SDR.
Plus the yuan is gold backed by 50,000 T of AU
The US is simply looking for some one to blame for its own mess. This is not a Us vs China financial crisis. It’s us vs us crisis
ANDY JUST SAID IT. EVERY COUNTRY IN THE WORLD WILL HAVE THE SAME ROLLBACK./
Dear Farmer,
I, too, am one who gets the crap scared out of me when I see or read what our government is doing or hints at doing. I have thought seriously of leaving the U.S. I gave up voting a few years ago as I realized the currrent paradigm is a sham; just 2 wings on the same bird. I never thought as one person said, ‘the clowns would be running the circus’.
Joni, St. Louis, MO
Greg, I was looking at futures tonight, Dow down 112. I find it ironic that the AIIB is about to announce there own form of the IMF. Their market crashes. What I liked best was the plunge protection team yesterday getting their butts kicked. China waited to announce the news after US invoked manipulation. I believe they waited. I have been following you for a long time. We have our disagreements. The day I sent you the donation was the day I saw the market shake. Thank you for all your work. I still think you need a vacation.
Maybe Greg like your own family, friends and family members in the UK are detecting a glimmer of something bad coming. But with too little too late the normalcy bias will continue right up to the time the ship sinks. This IS the scariest time financially as Andy H says. Great interview.
Expect a 50% drop in stocks very soon!
Do you remember 2008?
Do you remember having CNBC playing in every gym and every bar?
The 600- and 700-point drops in the Dow in a single day?
The talk of black swans.
The new vocabulary you suddenly had to learn:
Systemic risk… Credit default swaps… Sovereign debt… Glass-Steagall…
Do you remember watching your 401(k) fall by 30 or 40 or 50 percent?
Did you worry about your future? Did you sleep well?
None of us can stop the next 2008
But what’s coming now is gonna be worse than a bear market. We are in the very early stages of the complete collapse of the global free market capitalist system replaced by a crony very fascist andvery racist corrupt form of a communist new world disorder!
Created by the massive global market distortion caused by the debt, greed and corruption, allowed to permeate through out the whole present morally bankrupt and evil system of things.
The reason everything seems so good right now, five years into a roaring bull market, is that we are living in the biggest asset bubble in history.
This bubble has been inflated not by real production and real demand… but by an incomprehensible amount of DEBT!
There’s no sense in rehashing it all except these pertinent facts. If you’ve been following USAWatchdog, you know. . .
•In the last decade, the U.S. government has borrowed more than $10 trillion, — more than doubling our fictitious, unrepeatable credit line.
•We as a country cannot even pay the interest on this much debt, much less repay it.
•So the Fed has been forced to drive down interest rates to near zero, and that is causing massive dislocations around the world.
•Several countries in Europe are on the verge of default.
•Bankrupt governments are paying less than 2% annually for their bonds, but buying nearly all of the supply (or more than all of the supply) with newly printed money.
What a mess.
And if you think this bull market in stocks proves things aren’t so bad… you’ve lost your marbles.
Of course stocks have moved higher. Money has nowhere else to go.
But do you know who the biggest buyer of U.S. stocks was last year?
It was S&P 500 companies themselves.
The folks running these companies are gorging themselves at this global buffet of unlimited credit expansion and debt!
General Electric — for years, one of the biggest and most prestigious U.S. corporations — would now rank on par with the top 10 “sovereign” borrowers in the world, based on the latest published debt figures.
Incredibly, GE now has around $316 billion in debt — about the same amount as the bankrupt nation of Greece.
Another once-great company, Ford, has more than $100 billion in short- and long-term debt. And do you know what they’re doing right now besides moving assembly plants down Mexico way?
Buying back their own stock!
Now, I love stock buybacks. They’re a great way of returning tax-free capital to shareholders.
But this is a company in an ultra-competitive global market that’s drowning in over $100 billion of debt.
They shouldn’t be spending a penny on stock buybacks until they’ve paid off that debt.
Then they should be investing in their own business.
But, instead, they’re propping up their share price by creating artificial demand. It’s no better than a Ponzi scheme.
And this is exactly the kind of distortion that’s happening everywhere in the markets all over the world right now!
It’s creating the illusion that the stock market is healthy and strong… when the reality is it’s never ever been more dangerous!
There’s a very simple indicator of how dangerous this situation has become for ordinary investors — and I doubt you’ve heard of it before.
It’s the market cap of all U.S. stocks divided by our GDP.
In other words, it’s the broadest measure of how cheap or expensive stocks are compared to the country’s real economy.
Through the start of this year, this ratio is way higher than it was before the crash in 2008.
In fact, the only time in history stocks have been more expensive in the United States relative to the size of our economy is the year 2000 bubble.
And we’re closing in on that level, fast.
Of course, we all know what happened next.
Now is it possible that we’re going to surpass that bubble in terms of idiocy?
Sure, anything’s possible.
But if I told you in 1998 or 1999 what was about to happen in the stock market, what would you have done?
The point is, sometime soon — and perhaps much sooner than anyone expects — the party’s gonna be over.
THE PARTY’S OVER! https://www.youtube.com/watch?v=jb0DK0P2Ak8
Here’s how I summed up this situation with one of the analysts:
“So anyway, the point of all this is I’m extraordinarily bearish. I am worried to the point of buying physical gold and ammunition, and I am not kidding. This is just complete madness, and I can’t know when it’s all gonna roll over, but I do know that you’re not gonna survive by depending upon high-priced securities analysis.”
You might think it insane, pointing out the limitations of our own broke’rage firm.
But my job is to tell the truth.
And the truth is that no portfolio is immune to the complete disaster facing the world today and there are hugely more important steps to take to protect our very lives!
LET me to speak my mind.
$10 trillion in new debt we’ve accumulated since 2006 is distorting the whole global financial system. This is what your politicians and central bankers don’t want you to know — ever. Do you know personal debt in the United States almost make’s the government’s spending look good. That’s why you want to protect your ass’ets or you don’t understand how bad this situation is!
I can’t stress this enough: Now is a time to be extremely cautious.
I believe it’s only a matter of months — weeks, perhaps — before things take a drastic turn for the worse.
• Don’t expect your government regulated health insurance (easily the best crooked money grubbing business in the world) supposedly to keep you healthy, what a joke, if it weren’t so tragic! Better take responsibility for your health now, eliminate all processed sugar, read labels, it’s green drinks, smoothies and better late than never.
Again, I strongly believe that a 50% fall in U.S. stocks could be just around the corner.
And that’s on top of the impact that a steep, rapid fall in the value of the dollar will have on our WAY OF LIFE.
Nobody knows how this reckless government gluttony for debt is going to end up except our creator, no doubt, I hope!
It wont be pretty till he steps in to put an end to all the nonsense and may your sanity and the life he save’s be your own!
Stay out of the chaos of insane markets and soon the streets!
Look around. Have you ever seen anything like the 30% move against the Euro in a single day when the Swiss de-pegged their currency?
I’ll give you a hint: You haven’t.
As Bloomberg reported, that event was 180 standard deviations outside of normal volatility — an event you should expect to see about once in a billion years.
There are a lot of strange things happening in the markets right now. It’s not a time to be complacent. A huge, disastrous market event is right on your doorstep.
Remember please! Life is FRAGILE_ HANDEL WITH PRAYER!
Regards,
Stan Porter,
EXCELSIOR!
https://www.youtube.com/watch?v=-OQcglFoL_Y
TL;DR
Get your own interview maybe? O_o
Agreed. Brevity is a virtue.
Your “comment” is taking up a lot of real estate. Good “comment” / book but brevity would be appreciated.
🙂 Love it.
Extremely relevant interview , with lots of data to support the arguments,,,,
Just excellent ,,,
Keep up the good work Andy and Greg,,,,
Mikkel Jacobsen
The devaluation of the yuan brings to mind Don Meredith on Monday Night Football when he would sing, “Turn out the lights, the party is over…”. I really do believe the party is ending… and fast! Good discussion on the impact of the Yuan’s devaluation and the Fed’s reaction. Thank you Greg and Andy.
You know my question is : if money is devalued 50% , what does that mean in terms of my electric bill, what does that mean in terms of my water and sewer bills. I kind of understand food, and toilet paper. Sone said the “crash” would affect distribution, now that I can get my head around, because that relates to store shelfs, utilities baffle me.
Well, the economic policies of the liberal/leftist/Marxist/socialist Democrat Party are about to be tested in earnest.
Instead of a couple of years of hardship as the free market healed itself, they chose to destroy the free market and give us decades, if not generations, of poverty and financial serfdom.
Democrats and the RINO cowards who refused to stop them have a lot to answer for. In the New World Order, they’d better stay away from me. I’m not going to be in a very “understanding” mood.
The time to get gold/silver at anything resembling an affordable price is vanishing rapidly.
Great interview !
While I didn’t expect too much from some one who goes by the name “marketing director”, he really surprised me.
The first one who openly stated that mine shares are useless at that time, because governments going to confiscate and “nationalize” them. That’s what they always do – in desperation, they going to abolish all ownership rights, and steal everything from you, be it gold, stocks, land, weapons, or whatever. Others call this socialism or communism.
Frank,
That is his “official” title but you tell he was a former Wall Street analyst by how he puts it together. He can also back it up with his written articles on MilesFranklin.com. Thank you for your feedback.
Greg
Another riveting interview. THANK YOU Greg. My favorite days are Monday, Wed and Fri AM because your interviews and wrap up come out then. 🙂
I wonder if Russia and China will be able to pull out of this a bit faster and better because of the things they re setting up? And I am hoping they can manage to prevent a global war.
I also visit Miles Franklin, Bill Holter/Jim Sinclair and Gregory Manorino on a daily basis. I feel like they are all on the pulse. And that’s because of the wonderful interviews you have done with them in the past. I never knew doubt these knowledgeable people until you had them on for interviews.
I just hope I have a few more weeks before everything goes chaotic with banks and payments. Keeping my fingers crossed. Stay well Greg!
Thank you Margie for your support.
Greg
Another ‘great’ interview Greg. Andy, Bill Holter and a number of others are those whose writings and podcasts I pay attention to as soon as they are available. I put great in quotes because indeed the perfect storm is about to be released and when you look at this country I see lemmings going over the cliff. Very few indeed [aside from a feeling of general uneasiness’ have any sort of an inkling that anything is wrong.
God help us because he is the only one who can. And yet when we need God’s help the most this country turns further and further away from him. Time to be like Noah and bring the family into the ark because the flood is coming.
Standing ovation! Well done…….
Greg, it seems to me that China has not so much “devalued” its currency as it has allowed it to begin to float to its “real” market value. The most devastating initial effect will be produce a tremendous decline in the price of oil and, as a result, a reduction in international demand for dollars with which oil is now purchased. I believe this is a prelude to China issuing a gold-backed currency, a prospect that has Western establishment bankers terrified. Does this make sense to you?
Another good one with Mr. Hoffman.!
Yuan devaulation is dollar negative. Lower Yuan = More Yuan-based Transactions
A lower Yuan may make it a less attractive place to park reserves. The Yuan, currently however, is not a reserve currency but an increasingly transactional one. A lower Yuan means Chinese goods will become cheaper and trading partners should see an increase in trade with China, meaning the Yuan will be used more with countries that already trade with China in Yuan and countries that don’t may be encouraged to do so as their trade with China increases. Thus, demand for the Yuan as a transactional currency will increase and demand for the dollar decrease.
What are the Fed’s Options?
If the Fed wants U.S. products to remain competitive internationally it needs to consider not raising rates, which would further strengthen the dollar and the U.S. needs to consider as Mr. Hoffman points out, devaluing the dollar. Yet, in order for the U.S. to boost demand for U.S. Treasury bonds (necessary to fund hundreds of billions of dollars in annual deficits, a $19 trillion over all deficit and over a hundred trillion dollars in unfunded liabiities) it needs to raise rates to attract capital and maintain the U.S. Treasury bond status as thesafe haven.
Devaluing the dollar or not raising rates would damage that status and may lead to futher selling of U.S. Treasury Bonds.
https://smaulgld.com/china-beats-the-fed-to-the-punch/
Greg, you did not disappoint with this interview. Andy Hoffman’s take on the world (financially and economically) seems accurate. You get points for the remark that the Wall St. crowd is not going to sit and wait for a pie in the face -they definitely will front run this thing. Sadly, Hoffman is also, more than likely, correct in suggesting that the US government will nationalize the mines, as they are money -literally. It’s too bad that politicians are invariably see themselves as forced to take drastic actions because of their own ineptness, corruption, and dishonesty.
Thank you WK Hoffman was very good!
Greg
32 days until it all blows up. God help us al !!!!
Hello Greg,
Spectacular interview. Thanks for having Andy on. Two quick things. In Canada metal premiums, for silver especially, are climbing indicating that the shortage that we all know about is coming to a head; second, a family member of mine (a lawyer) sat me down during a visit last week and asked me to fill him in on what I knew about what is actually going on. We spent three hours. He was scared so asked a lot of questions. First time this has happened with anyone in my very large extended family. Another indicator that awareness is seeping out into the general public. I asked him what prompted all this in his mind – he couldn’t say. I found that most interesting.
Tip of the iceberg, Evan.
Greg, Great interview again. Andy is awesome. When we talk about hyper-inflation…at what level….20%,30%,40% or greater?? What will this look like for the average guy like me??? I mean cost to product ratio… A loaf of bread now $2…$3 dollars later?? Thanks as always..:)
Premium brands, such as Pepperidge Farm, are inching to $5.00. Enjoy. And everybody join me in a rousing chorus of “YES! We have no inflation. We have no inflation today.” Best always. PM
Paul – you are on a roll today. Save me whatever you’re taking…
From an economic standpoint, there is no reason to raise interest rates. However, I can see the Fed wanting to raise rates just to crash the economy and thus allow themselves the opportunity to engage in more QE.
Debt problems from the emerging markets now causing troubles in the US. Things falling apart at a faster pace now. Can they truly devalue the dollar by only 30%? Always thought it had to be more like the old Ruble and knock off a couple zeros in the process. This is the only way to clear up the debt and back the entire financial system. 30% is just a little rock in the mountain of debt.
Thank you very much Greg, this is a great interview. After watching I felt like I actually learned something other than what is happening today; Hoffman explained things in such a way that I learned a bit of how things work. I like being taken to school when I actually learn something. We might not like what’s going to happen, but forewarned is forearmed.
I don’t know why we don’t sanction China and tariff their imports instead. Globalization was supposed to lift all bows, instead we are all circling the drain in a race to the bottom. Just opt out of the currency war and give them the middle finger.
Andy and Bill Holter are a real one two punch and you my friend have just gotten their
expertise for the benefit of your listeners. What a coup! Keep up the good work Greg.
The economy is NOT going to collapse! The US, China, Russia or anyone else do not have the ability to collapse the world economy.
However we are all going to suffer mass pain from Satan himself. This will be the cause that crashes our entire civilisation, not money and not politics.
“This is the life we chose, this is the life we lead, there is only one guarantee.. Non of us we’ll see heaven”
Howard, I know you are disappointed, perhaps even disillusioned. You have lots of company, me included, but stay grounded. As Bill Holter pointed out, credit is the vehicle by which the supply chain moves. No credit, no supply. When a crisis such as we anticipate hits, credit will be affected and the supply chain will freeze. That’s a bad development. And it will cause the economy to collapse. And it’s scary. But it–nothing– cannot take away Christ’s sacrifice and atonement. Best always. PM
Howard, anyone who wants to see heaven can ask the Lord for his Spirit. Anyone !!
It says “Whosoever will call upon the Name of the Lord will be saved”. Whosoever means anyone. I agree that it is Satan using people, governments and the world.
We are called to pray everyday about this.
Wishing and praying for the best for you and for our country. That we will be returned to our former state.
Let’s start talking abut where we can put our money. For those of us with employer 401k, and limited ability to physically store gold or silver, is there any investment or any financial instrument that we should put 401k funds into, etc.? What kind of accounts are safer from a bail in? All feedback welcome!
I ask the same question RM. I have limited employer choices as to funds for my 401K.
Gold is very small so I don’t understand your limited ability to store gold (Unless you are talking millions of dollars). First food and water at least a years supply of food per person (buy #10 cans of freeze dried food). You put them under beds and replace the box spring with them if you have to. As much water as you can store. Second Emergency cash on hand (not in banks) for six months. Third guns, ammo, and training. Fourth more emergency cash for another 6 months. Fifth gold/silver coins as much as you can buy. Last property that has water and can grow food…
Get out of that 401k.Take the tax hit now or forever lose it in the ‘security’
of USTs. Uncle Scam is not making any secret of their plans for your 401k,
after the next downturn.The FedRes is not going to be the bag holder, pensions
will.
Yeah anyone who thinks their 401k will still be there in five years is borderline nuts, they will not let the welfare and social security dry up and somehow leave the 401k’s untouched, those will be the first thing to get raided..after peoples savings accounts get locked down of course…if we are lucky that will be all that happens.
You could try to put some 401k funds into Sprott silver (PSLV), or the Central fund of Canada (CEF). In a 401k still not completely safe, but outside of the US at least, and believably ‘physical’.
Somebody at theUnited States Mint must listen and hear what’s on Greg Hunter web site. They came out with an ounce of gold stamped with ( $100.),( American Liberty 2015 High Relief Gold Coin.) Meaning gold will never fall past $100. dollars per ounce. Last count of the mint, 8000 left out of 50,000.
Good info and than you Doug.
Greg
Hi Doug
Here is another interesting fact-not sure it means anything- The Royal Canadian Mint started offering $20, $50 $100 and $200 face value silver coins last year, but unlike the popular $5 face value one ounce Canadian Maple leaf coin (which sells for about $20), these $20-$200 coins do not have much silver.
For example, the
$20 coin has 7.9 grams of silver or about a quarter ounce worth just less than $4
$50 coin has 15.87 grams of silver or just less than a half ounce worth about $7
$100 coin has 31.8 grams- just less than an ounce worth $15
$200 coins has 63.07 grams or less than 2 ounces worth $30.
These coins are a reverse hedge- they maintain their Candian fiat face value which is currently higher than their silver content. You can buy them at the current low price of the Canadian dollar and double hedge the Canadian dollar vs the US dollar and silver vs both!
Sorry but these Canadian coins don’t sound like a deal to me when I can buy a troy oz of silver for $21.
Just my two cents
Galaxy
I agree. These coins are not a way to collect bulion
Their value is for collectors . If you are going to hold $20 in Canadian money its better to have a coin with $4 worth of silver in it than a $20 paper bill
Of course you can take your $20 and turn it in for a silver round or canadian maple leaf coin instead
Doug,
Not necessarily. they can put any amount on the coin. Thatis sort of the spread they will make.
It will come down to the value of the gold content.What if they put $100,000 on the coin.
It makes no difference what they put on the coin.
Take care
Doug and WD putting arbitrary fiat related numbers on precious metals coin doesnt mean much,but I’d rather have a coin that is legal tender have a higher number than a lower one
US one ounce silver eagles are $1 face
Canadian one ounce maple leaf coins are $5
Greg, another excellent interview. How timely!
Maybe the typical American will wake up now? Oops, never mind, just a rhetorical question.
Diane D,
You’re funny and thank you.
Greg
Fantastic Interview Mr. Hunter
What clarity Mr, Hoffman has provided, I would suggest that your viewers (self included) have had a very good insight (warning) as to how the end game is playing out. A.K.A….race to the bottom with the last country standing.
I may be totally naïve when it comes to understanding how individuals buying gold and silver is going to be beneficial. You can have a semi trailer loaded with gold but the question remains……what good is it going to do for you? If the economy collapses, to the extent that many predict, where are you going to spend it? Also, what are you going to spend it on? When the money stops flowing, welfare recipients in particular, have been shown to not react to that very well. Some time ago, the government indicated that welfare payments may have to be reduced and the uneasiness reached a quick crescendo. So much so, that it was immediately rescinded. Their response to these events is to act in a total irrational way. Stores will be looted, as well as any individual, perceived to have something they want. This is why the government conducts exercises such as Jade Helm. It has nothing to do with combating terrorists. It is for crowd control, plain and simple. When things go wrong, they will go terribly wrong. While buying gold and silver, maybe other metals such as brass and lead should be included.
Gold is the transfer vehicle across the troubled waters. Gold is how you carry your wealth forward. For day-to-day survival trades and commerce, it will be much less practical. For that, silver, copper and consumables (food, cigarettes, booze, lighters, fuel, paper products etc.) will be better “currency”. Gold will allow you to reestablish your wealth and position in the new order, should you survive to it. Look, we don’t know what’s coming, really. Maybe it’s bad, and maybe it’s a catastrophe. Maybe it’s no worse than now, which, if it plays out as it is, will land us back in the ’30’s with regard to standard of living. In my estimation, we should be worrying less about the value of gold and currencies and more about scaling back government, and not just the US government, but ALL government. To me, that is the heart of our problem, and we must get past this idea that somehow we can manage the system to produce equal outcome for everybody, because that equal outcome is CUBA. (And at least they’ve got nice weather.) Best always. PM
Most likely gold/silver coins will be for your grandchildren to spend and they will thank you or at least a photo of you. And you are right gold and silver are down on the list of items that will keep you alive in a collapse. You should store food, guns, ammo, land that grows food before you heavely invest in gold/silver. But if you have dollars hanging around with nothing you can think of to trade for that will help you in a collapse trade them now for gold and silver while you can because one day dollars wont be worth the paper they are printed on…
“RTW”, the assumption is that at some point some semblance of order will emerge. Yes the inevitable chaos of a major transition will make cigarettes, booze, safe to eat food, paper plates, machine guns and hand wipes worth more than gold; but eventually, if human life is to continue, at some point things will have to settle down, and it is at that time that those who were able to hang on to gold and silver (and their lives) will come out way ahead.
I wasn’t looking that far ahead. The key then, is to survive long enough to be part of the rebuilding process. I’m not condemning gold and silver. I own a modest amount of silver but quit buying because I’m not that optimistic that things will return to normal in my lifetime. Food, water and other essentials are definitely more important in the short term.
I thought they devalued due in great part to the West (the U.S.) consumer being so weak..
Question ? I absolutely loved the Interview. Thank you, Greg.
I did not understand the US dollar in this interview. I heard Andy Hoffman say that the dollar would just go up and up. Well, how does this create a scenario for the dollar to crash. The main information needed here would be, when to get out of the banks and the dollar if it keeps going up ?
Carol Smith,
Economist John Williams contends that the dollar will ultimately hyper inflate as all the other countries holding our bonds and other liquid dollar assets, sell them. Williams says there is at least $16 trillion in liquid dollar assets held outside the country. That is the real end game in store for our citizens. That is the very short answer.
Greg
Greg/Carol,
There is some logic to an outright USD devalution. ZIRP couldn’t do the job. Muliple QE’s had the opposite effect.
Last rabbit…out of their magic hat…is a DEFAULT…via a devaluation.
Re-pricing Gold is not an option (for currency devaluation) as Gold is not aligned to the monetary system …YET.
Consequences of devaluation ….are similar to a severe bout of INFLATION. Why have inflation…..to allow interest rates to GO UP.
Keep in mind that debt is automatically defaulted on when the currency devalues…so the interest servicing cost is adjusted and suddenly becomes “manageable”. GDP also sees a dramatic shift because of the weaker dollar.
This is really an option of last resort for the US Fed/Government. Perhaps their only option …aside from WAR.
The “crash” of the dollar means that no one accepts it as payment any longer as it no longer holds any value. The dollar goes “up” BUT the value of that dollar goes down. Example: A loaf of bread today is $2.00 but as the dollar goes “up” the loaf of bread costs more and more ($5.00 or $150.00 etc.). When the dollar is no longer accepted as payment for things you need to survive due to hyperinflation,, barter, gold, silver and junk silver will be the only means of payment as these items have intrinsic value and are not based on “faith and trust in the U.S. Government). That is why “rich” people are buying gold, silver, art, land, and other items which have intrinsic value, so that they will have some remnants of their wealth after the dollar is no longer worth anything. The dollar is worth only cents now in real terms, but is still used as most people still have faith and trust that it is valuable when it is almost worthless now. When all the overseas dollars come home to roost and the Fed announces QE4 we will be swimming in dollars which have no value and we will be using them to burn in the fireplace to heat our homes just as the German people did in the Wiemar Republic. Youtube has some great documentaries on that era.
Andy is always great. Thanks for putting him on now (uncanny timing based on his recent article). Greg, I hope a few more of your family members are starting to “get it”. All the best. Doug.
Greg, I just can’t see how any real growth could take place with the balance sheets of most all countries I know about. The historic mold would be a revaluation of global assets and debt. There may be a high inflationary period before that, but debt has to be defaulted on before any grow could take place. Then there’s this peak oil and resource question that would have to be answered. The world is running out of resources, and in my opinion water will be the main issue. The EPA just poisoned a river running from Silverton Colorado that will spill in to lake Powell in the west. The poison was lead and chemicals used to refine metals in a holding pool where an EPA agent supposedly accidently released into a contributory leading to Lake Powell. The whole tourism industry in southwest Colorado has ground to a halt. In prayer, the Lord keeps reminding me of spiritual dreams he gave me years ago, were the country side and landscape was burnt up. I suspect judgment is coming, and its probably not far off. I plead with people, both here and each day to make sure their lives are right with God. There is a group of believers that participate here, and I’m not the only person who has seen visions and dreams about this country. If God is speaking to any here, its my bet that they probably are having similar experiences. Another great job my friend, I will try to send you financial help when I can. I am disabled and living on little income right now. May the Lord bless and his blessing be upon you.
I hope it all goes to hell in a hurry so all you whiners can be happy living in cardboard boxes and hunting squirrels.
Mike,
Does the term “kill the messenger” strike a chord with you?
Greg
The “messengers” of late are fear mongering precious metals salesmen.
Mike,
I do not know where you are getting your news from if you think everything is fine. You are so misinformed it’s sad. All the best.
Greg
Greg,
I love reading and listening to your interviews. I am addicted to it!
To me it is great entertainment. I don’t take any of your guests or commenters very seriously, especially the guy who believes the government is sprinkling pixie dust on us from airplanes.
Yeah, you know what “Mike Gleason”, at least you’re coming here and hearing and reading what is being said. You might be an a$$, and you may or may not find all this entertaining, but at least when everything pans out pretty much the way Mr Greg Hunters guests are predicting you will be in a position to understand why it happened and you might be well motivated to explain to others how to properly pick up the pieces.
I only wish there were more folks like you who at least come to mock the truth about what is going on rather than just ignore the truth completely.
You are right Brian, I am mocking the truth but I am also calling attention that we should not believe everything we are told, no matter the source, without question.
Hey Mikie! For many of your fellow citizens, it is already here:
https://en.wikipedia.org/wiki/List_of_tent_cities_in_the_United_States
It seems odd that these citizens receive less benefit from Federal Assistance than Illegal Immigrants!
I wonder when they will be referred to as “Obamavilles”, just as we had “Hoovervilles” during the Great Depression.
Sorry about your future dude
Greg/Andy, Good interview… When Andy spoke of the gov’t nationalizing mining companies it struck a chord… There are so many Executive Orders on the books now that when TPTB start to really clamp down… where will it stop? What is our world going to look like … after… We have been to places in the world where one sees dead bodies in the street and IMO it is coming here. These are the times that try men’s hearts and these are the times when our Faith becomes not only so important but difficult. We are the remnant. Yours in Faith and Liberty, FN, DB
db,
I walked the streets of Karachi, Pakistan in the mid-seventies. It was quite an experience. Hashish in taxis; pimps for any female you preferred; sellers and consigners for about everything else. Life was cheap, really cheap; and moral constraints Westerners are used to just didn’t apply. And America will descend into a quasi Third-world state; but not before great social unrest and mayhem. I believe your assessment is correct – lots of violence will touch most of the US. And Faith will prove the most valuable of human possessions. We are the minority, at the end of the Great (Gospel) Harvest. CH
Hello Greg,
Absolutely, and I mean absolutely, one of your best. Keep it up. Also, here is why Jonathon Cahn is wrong about the sabbatical year: https://codgerville.wordpress.com/2015/01/13/why-jonathan-cahn-is-wrong-about-the-shemitah-year-sorta/
I encourage you to study the Puetz postulate (Dr. Steve Puetz)
Good luck and God bless.
CC
Why does the media ignore the fact that Marvin Bush was some kind of director of security for the world trade center towers prior to and during their destruction? Bush, the pres, lied on national tv and was directly responsible for the creation of multiple wars which are killing millions of people as I type. These wars will not stop until there is justice. Some fairy tale about hunting down Osama and throwing his body in a lake is not justice. Where is the evidence? The American people demand justice, in fact, the entire planet demands justice and will get it one way or another. I don’t want to go down protecting a family like Bush (2666) b=2,u=6,s=6,h=6
The American people demand justice. NO JUSTICE NO PEACE
Greg,
It looks like Rick Ackerman is being proved right…time for an another interview, maybe?
Thanks again!
I would appreciate some balance on this issue. Richard Duncan would be a good place to start.
Will Trickle of Earnings Warnings Lead to a Flood of biblical proportions?
Will the trickle turn into a flood? That’s what investors are furiously trying to figure out when it comes to earnings warnings.
Today, we got a handful of them from a diverse group of companies. The first came courtesy of department store chain Macy’s (M).
It said sales dropped another 2.6% in the second quarter that ended August 1. That was the fourth drop in the last six quarters, with the $6.1 billion in revenue missing analyst estimates. Adjusted earnings per share of 64 cents also missed targets, and Macy’s said things won’t get better anytime soon.
Next up was telecom giant AT&T (T), which just finished swallowing satellite television firm DirecTV for $49 billion. It said revenue would grow at a double-digit rate for the remainder of 2015, and that earnings per share and free cash flow would benefit from the acquisition.
But that didn’t satisfy investors, who were apparently expecting better news. Result: The stock fell almost 2% on the day to a three-month low.
Perhaps the most telling – and troubling – warnings came from the Chinese Internet darling Alibaba Group Holding (BABA). It launched the biggest initial public offering (IPO) in the world last September, raising $25 billion. But anyone who bought right after the offering has gotten his or her head handed to them.
Indeed, the stock just sank to a post-IPO low after revenue missed estimates in the fiscal first quarter amid slowing online sales growth. While the company announced it would buy back $4 billion in shares to try to bolster their value, that didn’t placate investors.
Alibaba launched the biggest IPO in world history. But now investors are getting hammered.
Why should you care about BABA? Because it’s the Amazon.com of China. It also has other online operations and businesses in China. If it’s having these kinds of problems, it could be just a precursor of what to expect down the road from U.S.-based companies with significant operations in that country and elsewhere in Asia.
After all, China allowed its yuan currency to devalue by as much as another 2% overnight (before intervening to ease the decline to around 1% late in the session). We also got the first competitive response from another regional player when Vietnam widened its currency trading band last night.
Jitters over weakness in that part of the world are already hurting the very popular and widely held tech giant Apple (AAPL). The company has been generating around 25% to 30% of its sales from China in recent months.
Automakers like Ford (F)and General Motors (GM), as well as large diversified manufacturers like 3M (MMM) and Dow Chemical (DOW) are also likely to come under pressure if we get a wave of competitive devaluations in Asia.
Per Bloomberg, MMM generated almost 30% of its sales in the Asia-Pacific region last year, while Dow gets about 17% of its sales there. What about global tech behemoth IBM (IBM)? Almost 22% of sales come from the Asia-Pacific region. Airplane maker Boeing (BA)? Its Chinese sales just topped 12% last year, with another 13% of sales from elsewhere in Asia.
“Why should you care about BABA? Because it’s the Amazon.com of China.”
See what I’m getting at? China isn’t some small economic backwater like Greece. It’s a major global behemoth.
So don’t believe all those mainstream talking heads on CNBC who keep blathering on about how the weakness in Asia and elsewhere doesn’t matter. It does. I want to make it crystal clear that I’m more cautious now than I’ve been in a long, long time. It’s why I and others here have been urging protective action and cash-raising for the last couple of months.
Haven’t gotten started on that yet? Then I urge you not to delay much longer!
So what do you think? Are Macy’s, AT&T, and Alibaba just the first of many to warn about lackluster earnings and sales growth? Is the Chinese devaluation going to cause major headaches for big multinationals? What does all this mean for stocks? Are we finally headed for a real, honest-to-goodness correction … or something even worse?
Scuttlebutts
China’s aggressive currency move reverberated throughout global markets yesterday, and it was a major topic over the web.
Rick said he sees a distinct motive behind China’s move, offering this perspective: “Looks like the U.S.-influenced decision to keep China out of the IMF for another year is already having consequences.”
Ted F. said China’s economy is suffering because the government failed to re-focus on domestic demand versus exports. His take: “China built way too much of their economy on selling abroad, but failed to build their own internal consumer base. That worked fine for the Chinese until everybody’s economy started slowing. Then China went on massive building programs with no customers.
“The big question is, ‘Will Obama sit on his hands as usual? Or will he counteract the Chinese move, as every other Asian country is a sure bet to do?’”
Finally, John said we should be very worried about the signal China’s actions are sending out. His view:
“What the Chinese devaluation of the yuan means is that things are worse in China that you might think just from reading about it in the news media (no surprise) and that they did it twice (another cut in the yuan on Wednesday followed the one on Tuesday) is puzzling – since they seem to have stated on Tuesday that the cut was a ‘one time’ thing. I guess after promising there would be no more, they couldn’t hold off another cut in the yuan, even for 24 hours. Hmmmm.”
Meanwhile, in the other global hotspot of Greece, Carl said the latest deal won’t change the underlying fundamentals at all. He said:
“Greece can’t pay. Their economy must expand enormously to service their debt, and it’s tanking. Everyone knows the fundamentals. Loans and bailouts are political theater and maneuvering to have the bomb go off on someone else’s watch. It’s not even a secret anymore!”
Well folks China’s economy is clearly on the ropes, or else officials wouldn’t be launching so many panicky moves one after the other. Rate cuts as the rats cut, direct stock market interventions, and now currency manipulation aren’t the kinds of things you’d see when things are humming right along.
Throw in the still-simmering European debt problems, and you have a potent mix for more volatility – and potentially severe stock market losses. That’s why I’ve gotten much more aggressive lately with paring down portfolios and covering my Ass’ets!
What a whirlwind of information! I didn’t understand some of it, but I got the main thrust. When Andy said the government will nationalize gold mines because they are “money” and the government will take anything that is money, it occurred to me that gold and silver coins could also be perceived as “money” and taken, too. It might be a very high tax on any sales or outright confiscation, but if this line of thinking is correct, stacking coins might turn out to just be giving away your wealth in concentrated form.
My angels informed me today that the elites are having some difficulties moving ahead with their plans due to some unanticipated complications, so the financial collapse is going to be delayed for at least a month to six weeks. For those who are counting the time based on whatever system they are using, push the date out by at least that much. That doesn’t mean that September will be incident-free, but it probably does mean that we won’t have a bank holiday that month if my angels are correct. So far, they always have been.
lmao, your angels are pushing back the collapse date, yah, I’ve got a bridge to sell you. This so called collapse will slowly sink over the next couple of years, not next month, end of year, spring, and all the crazy predictions. Nobody knows, this is just my opinion, and you know what they say about opinions. It’s just laughable the predictions that are posted, the only thing that’s 100% for sure is that NOBODY KNOWS WHATS COMING! Excellent interview GH, please continue informing the public, we’ll make a conclusion based on fact.
Greg,
IMO…China beat the US to the punchbowl.
Devaluation is the “default pathway” du jour.
We can only expect more of the same going forward with the US doing the absolute unthinkable and making a dramatic shift towards its own devaluation in orders of magnitude higher than what we have/will witness with China.
No one yet has made the connection or done the critical thinking.
Firstly China does the backflip on announcing its GOLD Reserves…. lower…much lower..than expected/anticipated. Intentional ???
Secondly …without warning it devalues the RMB by 2% knowing full well the consequences of its actions (weaker currency and an expected stronger USD).
The action in Gold pre-the announcement and now post tells me that the Heavy hitters are positioning themselves for a waterfall event in the financial markets. Also the action on the DXY suggests that the RMB devalution didnt exactly do what was expected (strengthen the USD)…..money flows ……to the safe harbour.
These actions seem all too incongruent for a NWO with an alternative/substitute Reserve Currency for the World… backed by GOLD.
A reserve currency should be gaining in strength as a prelude…not decreasing.
Concurrently we are left dismayed with their public announcements…which detracts from a State that it supposed to display Accountability, Integrity, Honesty.
I feel we are yet some time away from a RMB taking the world by storm. The IMF and China’s overt actions are symptomatic of a lack of preparedness/readiness notwithstanding the platform implementation and the growing list of willing participants. They have some deep issues domestically to deal with…and the game has now shifted into overdrive.
Also I cannot see China making irrational moves with regard to pushing the GOLD hoard declaration or to revaluing Gold much higher. They desire to have informed and cooperative particpants globally…so they are fully conscious of the impact such moves would create. It will done out of necessity, under due diligence and with consulation/ co-operation….after the existing regime has depleted its resources and ruined the financial system upon which it is based.
This is smart analysis SIG. Thank you.
Greg
SIG
China doesn’t care about the IMF or its Banking minions. They are preparing to cut themselves totally loose from the dollar. The devaluation will help them soften the blow when the conversion takes place this fall. When they are ready they will totally blow the fiat currency system away with their gold holdings. They have saved their Sunday punch until last when the Chinese Gold Price Fix goes active in September. This is your front row seat for what is about to happen.
Jerry,
I think you are correct this is a series of steps and they are not waiting until next year.
Greg
Jerry,
I believe you are right. I think this is a near perfect analysis!
China has a choice, stick with the status quo by being a semi US vassal state or break away.
They will take their chances and do what you are saying.
They will survive, and come out ahead… China has not other choice…Paul Craig Roberts is right; China/Russia either break away or get destroyed.
To quote one of my favorite songs:
“Sunday will never be the same”!!
Jerry,
I won’t disagree with your hypothesis, but there are many inconsistencies to what is transpiring…as opposed to what is expected to transpire.
IMO China is not demonstrating its intentions of becoming a bastion of morality clearly enough. It also does not want to be seen as one that instigates a global cataclysm which would be the case under your(s) (& many others) scenario.
I look at China and always remember the idiom..they are famous for ….. “Death by a thousand cuts” . Small but non fatal injuries are inflicted whilst avoiding a major /critical strike. When you look at the sequence of events leading up to where we are today …this has not been a year in the making …this is decades of planning. Your expected blueprint for September is not written in concrete. I feel the Chinese are waiting for the current regime to fall on their own sword…not without assistance I might add…in the form of more of the same …..”cuts”.
Central Banks Are Rapidly Losing Control of the total system of things
Since 2008, the Keynesian’s running global Central Banks had always suggested that there was no problem too great for them to handle. They’d promised to do “whatever it takes,” to maintain the financial system and print the world back to growth.
Thus far, we’d seen some pretty aggressive moves. The most aggressive was committed by the Bank of Japan, which announced a single QE program equal to 24% of Japanese GDP in April 2013.
However, the SNB was the first Central Bank to actually reach the point at which it had to decide between printing a truly insane amount of money relative to GDP (50%+) or simply giving up.
It chose to give up.
The SNB was the first Central Bank to lose control… but now China has done the same!
Yesterday China devalued the Yuan. Previously the Yuan was pegged to the US Dollar, but with the US Dollar surging higher to a ten year high, China had a choice: print an insane amount of money to defend the Dollar peg or devalue the Yuan.
Like the Swiss National Bank before it, China chose to devalue.
The significance of this is tremendous. China, the second largest economy in the world, has begun to lose control of its currency.
With over $555 trillion derivatives trading based on interest rates (which trade relative to currencies), this could very well light the fuse on the next 2008-type meltdown.
Best
Stan
Are you destined to be one of the Billions who are soon going to learn about markets, the hard way: Through giant losses of life, liberty and happiness?
Why? Because in a nutshell, most analysts and Joe six-pack the plumber are confusing normal times with abnormal times.
More specifically, we are approaching a sovereign-debt crisis that will soon cripple the socialist-style Western governments of Europe, Japan and the United States. The ramifications and consequences are going to be felt far and wide. Even in interest rates.
For instance, no one knows for sure if Janet Yellen will raise rates come September or October. But let’s say she does indeed raise rates. Many are predicting some sort of Black Friday, where virtually all markets crash as a result. Gold, commodities in general, stocks, and of course, real estate prices.
And in normal times, that may be true. But these aren’t normal times, there biblical!
We’re coming out of the lowest interest rates in the history of the country. A period that was fraught with financial dislocations, even the near total collapse of the monetary system, and a period where the Fed deliberately kept its short-term interest rates at record lows.
Most people are not making the appropriate distinction between normal and abnormal times. These are defiantly not normal times and you will have to be defiant to survive
a sovereign-debt crisis that is rapidly approaching. It’s already hitting Europe. Soon, it will migrate to Japan, one of the most indebted economies on the planet, And then it will hit Washington, D.C. — the most indebted government in the entire history of the world!
Most of you sheeple are not making the appropriate distinction between normal and abnormal times. Nor have most not studied history at all let alone in detail.
Why do I say that? Because when a sovereign-debt crisis starts to hit, almost no one recognizes it.
Moreover, when a sovereign-debt crisis lurks right around the corner, rising interest rates have nothing to do at all with economic growth or inflation. Nothing to do with what analysts are calling “normalization” of interest rates.
Instead, rising rates in a sovereign debt crisis cycle have everything to do with the fact that governments are going bankrupt.
And what does that mean? It means that when interest rates start to rise, so will some of the biggest bull markets you have ever seen.
Simple logic explains why …
FIRST, rates were at record lows because almost nobody wanted to borrow. The demand for credit simply wasn’t there. It’s been a “risk-off” mentality for some time.
So as rates and the cost of money and credit rises, guess what happens. Demand goes up too. All the potential homeowners out there and businesses looking to borrow, for instance, will want to suddenly borrow again, before interest rates go any higher. And that in turn will stoke all sorts of demand, from housing, to commodities, to corporate earnings and to the stock market.
SECOND, interest rates negatively impact indebted governments. Unlike you, indebted governments don’t have the ability to hedge against rising interest rates. They don’t have the ability to reduce their interest-expense burden. All they can do is sit idly by while the cost and burden of their debts explode higher.
THIRD, there will come a time — in the not-too-distant future — when our foreign creditors, knowing fully well our government is broke, start to sell U.S. sovereign debt hand over fist, as they are already starting to do in countries like Greece, Portugal, Spain and in fact, most of the European Union and in Japan.
And that’s when — also not too far off in the future — the resulting rocket ride higher in U.S. interest rates that will occur will be the direct result of our country’s patently unpayable debt of well over $200 trillion.
When that moment comes, when investors begin to realize that it is Washington that is going broke and that Washington’s debts are really the force driving rates higher — they will then start to buy commodities, stocks, prime real estate …
And anything else they can find that is a hedge against collapsing governments.
This is how sovereign-debt crises have unfolded before, time after time. If you study the history of empires like Rome, Byzantium, the Spanish Empire, the British Empire and more.
Almost all of those collapses saw interest rates liftoff from abnormally low levels, to soar to abnormally high levels, and along with the rate ride higher came some of the biggest bull market bear traps the world has ever seen.
All because government was collapsing. Not because of inflation. Not because of high economic growth. But because those empires had run out of ways to fund their patently unpayable debts.
Don’t be a ignorant. When you see governments failing, (I see them going down now!) buy certain assets. Portable wealth shines bright: Diamonds, gold, silver, platinum, palladium, art and other collectibles.
So beware: The Fed’s first rate hike may seem like it’s overdue. Analysts may call it “normalization” of interest rates. Savers will jump for joy that they can get a better yield in CDs and money markets.
But in reality, any rate hike that is forthcoming will merely be the first subtle signs that a sovereign-debt crisis is right around the corner.
Don’t be one of the millions caught off guard with huge losses of life an limb! Don’t be one of the millions who don’t understand what’s happening or about to happen.
Instead, think out of the box and act out of the box to protect and grow your own sustenance, the life and wife you save may be your own!
Best wishes and stay safe and God’s Speed Donald, stir it up!
https://www.youtube.com/watch?v=uGGpS60Y2EY
Borrow cash at interest to buy portable physical assets and wait for a window of opportunity when said assets can be converted into property and land?
Sven,
That is very risky as far as timing goes.
Greg
Very true Greg. That’s why I’m here, keeping my finger on the pulse. Excellent interview by the way, really enjoyed it. Went straight up and never came down!
Regards
Sven,
I think Hoffman killed it. Thank you for your comments and support.
Greg
Greg that is true, but when one has nothing to lose it would be something to consider. Stealing from thieves to attain what is yours.
Only if you have nothing to lose.
A few points:
– The $DX rising to 120? Perhaps, but for a very short period of time. The carnage would be legendary, and it doesn’t even take into account the foreign policy situation that would undoubtedly arise – on many fronts as a result.
– $DX 120 doesn’t comport with QE-4 and/or U.S. competitive $devaluation. How does that circle, square…?
– China’s problems making the U.S. look pale by comparison? We don’t really know the full extent of China’s monetary and fiscal chicanery to be sure – but it’s coming to light, day by day. The U.S. however…? What do we ~really~ know…? (Did not the Chinese learn their monetary skullduggery at the feet of the money-changing masters right here in the U.S…?) The truth is that very few know the depths of debauchery to our markets that the Financio-politico establishment in the U.S. have engaged in, and probably won’t until this entire Sh!t-show collapses under the weight of its own Lies.
– Lastly, there is the ‘gold in China’ and what this portends – perhaps for the immediate future, let alone long term. If at any time, China can ‘prove’ to the world that it has 10,000 tons or more of physical gold in its secure, domiciled possession, the world as you have come to know it – especially if you live in the U.S., will forever change in an instant. Issues of confidence, faith, trustworthiness-of-currency – all of it, will be turned on its head – for the United States… This is China’s card to play at its discretion, if it in fact does have such inventory. What could precipitate such a bold action? It’s already in motion… ‘Currency manipulator’. ‘Enemy database hacking threat’. ‘Neighborhood bully’. In other words, whatever narrative the U.S. propaganda machine wishes to create and trump-up in order to paint a challenger to $USD hegemony, an ‘enemy’ in need of swift retaliation, will be done to protect that dominance, because there is no alternative. It’s either $USD as global dominant trade, or poverty in the U.S. that only the best Hollywood director could portray on screen —
Kerry lets the cat out of the bag.
https://youtu.be/PCAFnCo6nyM
Now the excuses start laying the groundwork for a dollar less future. The American people will go along with it like anyway just they did with same sex marriage, and Planned Parenthoods house of horrors.
Bubbling out there… Kerry is so out of touch. It is happening. I was at my bug out when I got news about China devaluing there currency. I ask 2 people to come on this site and tell me your comments. I cut my stay short in part to read your comments. LOL glad I did.
What would happen if the United States just DEFAULTED on all our foreign debt?
Told the world….sorry we a flat broke ,can’t pay any of you ……..
We still have the world’s largest Navy I think.
In other words….Sorry all you countries we’ve bailed out…all ends now.
Middle finger…or as Greg would say…”throw a pie in their face”
Well, I think the first thing that would happen is the price of everything found on the shelves of Walmart increases at least five fold….because those people we flip the bird to just happen to be making everything we buy. And everything we buy is essentially bought on credit…so if we say our credit is no good…well then its just, “no ticky no washy.”
But I mean yeah, we got a navy that is so powerful I guess we could go and FORCE people to work in factories overseas for next to nothing…of course if we are gonna do that, why not build the factories here and force folks here to work in them. You know like a work camp; Arbeit macht frei, low cal diets, shaved heads, pinstripe suits and all that jazz.
You’re probably right, Brian.
It was just an idea…since the whole world probably doesn’t like us anyway…may be time to start paddling our own canoe.
Maybe all the people on welfare who are able to work would have to because we could only afford to help the truly needy.
Thinks would be very bad for a while…but perhaps Adam Smith’s invisible hand would take over and the Free market would pull us through.
Yeah, I agree, so long as that invisible hand is not restrained or otherwise incapacitated by yet another invisible hand, that being the unseen hand of corrupt, monopolistic, opportunists seeking immoral advantage and having the law written around and every eye averted from their every, calculated misdeed.
Hi Greg . What a great interview. I was wondering if there were plans to get Jim Sinclair on in the future . I know in the past that his views on gold confiscation and mine nationalization differ from Andrew Hoffmans . It would be helpful to know if Jim still holds these views. Thankyou for all you do for all of us. R.J.
R.J.,
Yes, as soon as he is ready.
Greg
I don’t disagree with Andy’s theories but he’s wrong about one thing, you can get all the junk silver you want right here…
http://www.apmex.com/category/25820/90-silver-by-type/all
China’s move could trigger a vicious cycle of other countries trying to push their own currencies lower still. Former IMF economist and Morgan Stanley currency expert Steven Jen says “the emerging-market currency weakening trend is now going global.” He believes emerging market currencies from Brazil to Indonesia could be vulnerable to a decline of 30% to 50%.
So, the risk of another 1997-style Asian currency crisis playing out is clearly on the rise.
Second, China is also playing a very dangerous game with its own economy and still fragile financial markets.
The Bank for International Settlements estimates that dollar borrowing in China has expanded five-fold since 2008 to more than $1.1 trillion today.
According to Bloomberg, Chinese companies have $529 billion in dollar- and euro-denominated debt, which means their cost of servicing that debt just increased by $10 billion thanks to the PBOC.
And much of this dollar denominated debt may be unhedged, because up until Tuesday, the PBOC had kept the yuan in a narrow trading band against the buck. Bloomberg reports that: “Chinese property developers have lots of offshore debt outstanding — more than 20% of their total debt for some — and the majority of them have high leverage.”
In other words, China is walking a very fine line trying to boost its economy, while avoiding a major domestic credit crunch and market meltdown if the yuan falls too far too fast.
Bottom line: buckle your seatbelts because if financial markets weren’t turbulent enough for you already, China just upped the ante!
8 Banks fined $ 2 billion, When are the heads going to roll.
Clint B
Most of you misunderstand the strength and enormous reserve power of the US.
Relax. Enjoy yourselves. Nothing of economic significance is going to happen.
Paul Craig Roberts is correct – the manipulative power of the fed trumps events…
I think the Title really Nails It::: http://www.silverdoctors.com/did-the-final-war-just-start-did-the-us-just-detonate-a-tactical-nuke-in-tianjin/#more-56835
http://hosted.ap.org/dynamic/stories/U/US_FOOD_BANKS_IN_DEMAND?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2015-08-13-13-27-53
Those were the day’s my Friend, we thought they’ed never end, we’d sing and dance, forever and a day.
We’d live the life we chose, we’d fight and never loose, those were the days, oh yes those were the days!
CD
The Royal Canadian Mint is playing ” Fast and Loose” with your coins. If they were truely an ounce of silver (marked $20. dollars) They would be flying over the border it bullets because would have value ,( in a sense that you could spend it in a Canadian store. ) true $20. dollars for an ounce of silver then a so called” “ROUNDS” (an ounce silver), try spending your “ROUNDS” of silver in a store. The Canadian Royal Mint is playing “Fast and Looose” like to cereal companies in the U.S. Taller box, more thinner, less ounces, you think your getting the same amount for the dollars but you not not. I wish they would of ” STAMPED” $1000. of their 99 % American Liberty High Relief Gold Coin. Their would of charged maybe $2500. for it, but then I would know gold would not be going below $1000.