COMMENT: Marty, just wanted to say thank you for Socrates. It has been great on gold and even in the miners it has distinguished the lagers like Barrick from Newmont without worry of who is getting paid to pitch what stock.

Can’t wait for the sector overviews.

Happy New Year

PB

REPLY: It is tracking over 1,000 instruments each day. I do not have the time to write about everything. I am working on the sector overview. That should be ready with the turn in the ECM. I am so glad people are getting the hang of Socrates. I do have an expiration date and have no desire to write forever.

HAPPY New Year to All.

“Manipulating the World Economy” is now available on Amazon for pre-order. Amazon expects the book to be in stock on Christmas day, but you can purchase your copy of the book today. We do not control when Amazon lists the book and we have no idea how long it will last in stock. The price was kept low at $95 to enable everyone of all means to be able to purchase the book. This is already the second edition – 466 pages completely illustrated in full color.

Italy is again helping a troubled bank. The government approved an emergency ordinance to support the Volksbank Popolare di Bari on Sunday and provided grants of up to 900 million euros. Volksbank Popolare di Bari was founded in 1960 as a cooperative bank. However, funds from the Ministry of Finance will not go directly to the bank because of the no-bailout policy in Europe. Instead, the capital of the state development bank Banca del Mezzogiorno-Mediocredito Centrale (MCC) is to be increased and this combined with the deposit guarantee fund FITD. This new scheme is indirectly restructuring of the Volksbank Popolare di Bari.

In recent years, the Italian state has repeatedly had to bailout banks, including the Monte dei Paschi di Siena (MPS), which is the oldest bank in the world. Because of the long-standing economic downturn, the banks in Italy still have bad loans on the books because Europe refused to engage in a bailout as was the case in the United States. Instead, the ECB kept lowering rates in the hope that the banks would make up the losses. But the economy has never recovered beyond just superficial images. The bank’s losses have reached one billion euros. Prime Minister Giuseppe Conte reiterated on Sunday that everything will be done to protect savers and hold those responsible accountable, but those responsible are running the ECB.

Within the European Union, bank deposits up to 100,000 euros per customer are legally protected. In the case of Bari, however, according to press reports, there are around 70,000 small savers who have not invested their money in savings accounts but have invested in share certificates in the bank. These small shareholders could face total loss if the bank collapsed. This would also have serious social impacts in the Mezzogiorno region.

Obviously, our European readers should NOT own ANY bank stocks in Europe. Get out before you lose 100% in these bail-in actions.

QUESTION: Marty; It seems when Goldman Sachs makes a recommendation, it tends to be the kiss of death. They came out and said the stock market was going to crash at the end of 2017 just before it broke out. Now they are pitching gold but they have been the ones who controlled the warehouses. They are claiming the central banks are the buyers so that is an indication of a bull market. Any comments on Goldman’s analysis?

HC

ANSWER: Yes, it often seems to be the old trick that was played by the Salomon Brothers. Their analysts would be quoted widely touting to buy some bond and they were inevitably the sellers. Goldman said cash was king in November 2018, not stocks. Five of the top investors in 2018 all said the stock market would crash as reported in Money Magazine. Goldman was bearish if Trump won, as reported by the New York Times on October 31, 2016. Even Goldman Sachs told everyone to sell in 2019. This is the problem when you put out forecasts based upon fundamentals. They are just sophistry, for you can spin them any way you like. How many times have we heard a stock declines on positive news and the excuse is that the street was looking for better numbers.

Goldman Sachs’ new claim saying “gold’s strategic case still strong” pointing to central bank buying is highly questionable. It is a statement that seems to be a half-truth. Because the euro is paying a negative interest rate, the only way for central banks to diversify has been to buy gold and equities. Otherwise, all they have are dollars. There are people on the board at the European Central Bank proposing that they too begin to buy equities in Europe.

The amount of gold added to central bank portfolios was tiny in comparison to equities. They bought more than $1 trillion of equities in 2018. The central banks bought only about $57 billion of gold in the past 3 years. This story is very misleading. It makes it sound like gold is being bought because the banks know the dollar will crash. The truth is so far from the implications.

If you are going to pretend to make a forecast based upon fundamentals, then tell the FULL story and do not leave out the other parts

COMMENT: Sir,

While taking a break from reading the Repo Report, I came across these words written by Albert Einstein before he passed away

“Not one statesman in a position of responsibility has dared to pursue the only course that holds out any promise of peace…” he wrote. “For a statesman to follow such a course would be tantamount to political suicide. Political passions, once they have been fanned into flame, exact their victims.”

I fear we are going to crash and burn as you have said

Keep up the good work

DK

REPLY: That is a very good quote. It is so true. All the disinformation circulating around about this Repo Crisis one must question can they really be that stupid? This is really the Mother of all Financial Crises which will impact everything it touches. This will make the 2007-2009 financial crisis look like a trial run.There is no politician who will stand up and talk about this crisis nor will they dare to even ask pertinent questions for fear what will be revealed.

This is why this report does not end with this report alone. We will update it next year as everything unfolds. So it is more like a subscription to this catastrophe.

I attended the premiere of The Forum last night and got to meet those “elite” they spin such conspiracy theories about. Putin will be the keynote speaker at the next session in 2020. Interestingly, the film will be released to the general public on the turning point of the ECM – January 18th, 2020.

Most people have no idea that the World Economic Forum, which Nigel Farage said our World Economic Conference is the alternative, is more like a convention. They employ 800 people and they try to stand politically in between. It was founded by Klaus (Charles) Schwab.

Klaus’ vision was to create a forum where world leaders can meet each other and create a bond. The conspiracy theories that paint these meetings as the place where they decide what the world will do for the next year is really nonsense. These people are not in control of anything and as the world turned nuts in 2019, the leaders of Germany, France, and the US all declined to attend.

It began with the model being the Chamber of Commerce meeting in the United States. Klaus took it one step further and tried to bring business and government together. As events unfolded, it grew into an annual meeting which then people wanted to be seen as being apart of it.

The film is the first to show the behind the scenes of Davos.