Servias Ministries Blog

Banks continue to inventory unprecedented numbers of houses on their balance sheets.  They are controlling foreclosure volumes to keep houses off the market thus propping up property values.  If values decline further,  their portfolio loses value and they take a greater hit to their suspected insolvent state.  The Central Bank will accommodate this behavior in order to keep the current system afloat.  Low rates provide buyers with incentives for these larger houses that were built during the boom.

1% increase in bond rates would mean an increase in $500 billion in interest on an annual basis.  There is no reason to let the yield rise on bonds until the market demands action.  Debasing the currency will continue and the purchasing power will diminish, moving toward zero.  Physical assets will skyrocket when the public wakes up and attempts to trade dollars for physical assets.  The only plausible response would normally be to increase interest rates.  With current debt structures in place, that will not happen.  It looks like they are between a rock and a hard place.  The public will suffer and the truth of the matter is extremely difficult to find.

The interest rate would normally follow the inflation rate.  Below is the calculated rate (in blue) by shadowstats.com.  If broad inflation is at 5% and you are being paid 1% on your bank savings, you are losing 4% in purchasing power per year.  Depending on what you buy, your inflation rate may be higher.  In 25 years, you will have nothing left in savings thanks to the money printing philosophy that is currently in place.  If at the same time you had a 1 oz silver coin, 25 years from now you would still have 1 oz of silver and could trade it for something else of value.  How simple is that!

Paper (Fiat Currency) is being printed like there is no tomorrow.  Japan has entered the fray.  The Chinese are building aircraft carriers and accumulating gold, silver, and rare earth metals.  The sequester in Congress has stopped any view to the future.  What will happen?  Probably a crisis will arise whether real or manufactured.  In the meantime the precious metals appear to be at a screaming buy level.

Technical charts showing dramatic activity during off hours are a clear sign that somebody big is manipulating the market downward.  You must ask the question- Why would there be manipulation downward?  One can only conclude that they fear a sudden rise in the price of gold and silver.  Why?  It would alert the general market of the sustained devaluation of the U.S. Dollar.  In turn, that would have a major negative impact on the Dollar and create a run on the banks.  People would flee the Dollar and move to other currencies and to the precious metals.  It is all about protecting wealth.

The battle lines are actually hidden on the technical charts and only seasoned traders truly understand the endgame.  The rest of us must discern what is best for our own situation.  Most of all we must place our trust in Our Heavenly Father Who truly understands the ultimate endgame.

Gold get knocked down during the thinly traded hours, a classic move by the central planners.  At some point, people will no longer allow a small group of elitists to manipulate and plunder the wealth of the masses.  Our Heavenly Father will remove the blindness and there will be weeping and gnashing of teeth by those who trusted and placed their faith in the riches of the world.

The gold and silver “smash” is just about over.  The big investment banks have been smashing the price in the paper market in an attempt to move the market on an emotional basis by discouraging metals investors.  For those of us who believe that the macroeconomic pictures demands higher gold and silver prices, this was an excellent week to add to our positions.  The big buyers such as China must have been smiling this week.  Underlying gold stocks were smashed as well.  If you believe that reality will prevail, you were not moved by the depressed prices but looked to add to your position, however little it may be.

$4,000 to $5,000 is the range for gold to achieve.  The current price is not reflective of a top in the market but best reflects a bottom of the current wave before the next move upward.

Currency wars will continue to support price increases in gold.  Quantitative Easing (QE) will continue as we will probably see the official 2nd dip of the Great Recession admitted by those analyzing the rearview economic mirror.  Buying gold, silver, oil, gas, and other physical assets is a bet against the value of the U.S. Dollar and acts as an insurance policy against the further devaluation of the purchasing power of the Dollar.  If the economy was truly rosy as the talking heads suggest, we would not have unemployment at a staggering 22% according to shadowstats.com.  The emperor has no clothes… really!

Let’s face the facts, governments, politicians, corporations, and people are lying about everything.  Less and less integrity is to be found among the major power players around the globe.  The subtlety of the “love of money” or greed is so widespread, only discernment from Above can protect us from certain financial destruction.  With the Federal Reserve Bank purchasing U.S. Debt at such staggering rates, we must conclude that the U.S. is technically in default.  The Fed is creating money out of thin air then buying debt instruments issued by the U.S. Treasury.  In turn, the Treasury pays interest on bonds that were purchased with worthless fiat currency.  What a deal!

The Libor scandal where major banks colluded to fix the primary interest rate paid worldwide has had little impact on reform.  Why?  The very people who enforce the law have friends who broke the law.  It’s all about having friends in high places.

The Plunge Protection Team (PPT) is alive and well and manipulating markets for their “greater good”.  Insider trading continues to reap large profits with only a few scapegoats sacrificed to placate the public.  In the meantime, technical charts are being manipulated to extract money from the masses to benefit a few “privileged” trading banks.

The Financial Accounting Standards Board (FASB) was forced to relax and compromise its requirements that banks properly account for fair market value of assets thus allowing insolvent banks to continue in operation in hopes that their profits would cover up their true losses and return to minimum capital requirements.  Housing is in recovery only because foreclosed properties are being kept off the market to paint a false picture of reality.  The news media is accommodating by reporting a “recovery” in housing.

The Fed has kept interest rates lower than the market would otherwise require in order to re-liquefy the banks.  Effectively, this has been the greatest theft of personal wealth of private savers in history.  Coupled with the understatement and manipulation of the Consumer Price Index, senior citizens on Social Security are being robbed of their cost of living increases, another method of theft.

The above sums up why investment in gold, silver, and other physical assets is focused on defending yourself against the fraud that permeates today’s society.  The Chinese know this and that is why they continue to accumulate gold reserves.  When the day of reckoning finally occurs, physical assets will prevail.

The vessels of honor are being raised up for the day of reckoning.  Ultimately, the Elect will not be deceived but will have the Wisdom from Above to deal with the coming crisis… thankfully!

A very simple explanation:

The Russians continue to acquire gold so they won’t be helpless if the American Dollar collapses.  Putin said, “The more gold a country has, the more sovereignty it will have if there’s a cataclysm with the dollar, the euro, the pound or any other reserve currency,”

They keep their gold on Truth Street, an appropriate name::

http://www.bloomberg.com/news/2013-02-10/putin-turns-black-gold-into-bullion-as-russia-out-buys-world.html

The banks are holding assets that are in a declining valuation and they have been given a deferral on reconciling their assets values.  Instead of valuing this inventory at market value, they have maintained the value at these houses at their original cost.  If they were to immediately sell off these non-earning assets, the banks would be insolvent.

Unlike the 1980’s when the S&L crisis forced a cleansing of the banking system, the current central planners want to keep the status quo.  They are repressing interest rates to keep the current banking system in place.  The rigging of these rates help the banks, not the soon-to-retire baby boomers.

This excess inventory would normally force prices down in the real estate industry but the central planners know that if prices drop, the economy will suffer even more than it currently is.  The economy is teetering on the second half of the “Great Recession”.  If the numbers were being reported properly, the public would realize that we are already in the 2nd dip.  The “perception” game is in full swing.

The current system will ultimately be replaced with a “righteous” system designed by Our Heavenly Father.  It will be one of equal weights and measures.  Wisdom from Above will be used to build the infrastructure.  Anointed men and women will be called to oversee the system and defend its viability.  They are being prepared now.  They will understand and embrace Divine Intent and walk in Love.  They will be motivated by Love to insure fairness and equity in the system.  The current lawlessness will be exposed and removed.  No longer will mankind be enslaved by Mystery Babylon.  The system will be cleansed of the fraud that has been perpetuated by those who are currently in control.  This will be one aspect of Thy Kingdom Come!

Earthly power will always pursue war to sustain its lust for more power.  The European Union will ultimately look to war in order to maintain its rise to power.  “We will do whatever it takes to maintain the European Union.” is the rallying cry of the head of the EU Central Bank.  Economic data is getting worse among some of the countries and the worse is yet to come.

The U.S. has been in Afghanistan longer than both World Wars together.  Have we accomplished anything noteworthy?  The cost of lives, the wounded families, the tremendous resources, and the path of righteousness have all been major hits to America.  Our economy continues to spiral into deeper debt.  John Williams of shadowstats.com is convinced we will move into hyper-inflation soon.  He begins:

“U.S. Fiscal Circumstances Simply Are Not Sustainable

The 2012 fiscal condition of the United States suffered its worst annual deterioration in the history of the Republic.  Based on generally accepted accounting principles (GAAP-based accounting), the actual federal deficit hit a record $6.6 trillion in the year ended September 30, 2012, a level that was fully 42% of the nation’s annual GDP.”

It is imperative that we focus our attention of Our Heavenly Father, not the earthly wisdom that got us to this point.  HE will redeem us, not a bigger government handing out: a welfare check, a free cell phone with 300 monthly minutes, free internet, cash for clunkers, food stamps, section 8 housing, free contraceptives, Medicaid, ninety-nine weeks of unemployment, free medicine.

Man uses war to fix the symptoms of the problems when all he needs to do is look into the mirror.

The value of your Dollars continue to decline.  Retailers are repackaging their products into smaller sizes or contents and charge the same amount for less.  That equates to inflation.

Gold is money.  Dollars are “notes” or derivatives of money.  Gold holds value and preserves purchasing power whereas Dollars are not retaining value.  Central planners know this and they continue their attempts to manipulate the price of gold using the paper market, a derivative market of hard assets.

When the price of gold rises, it is a warning sign to the market.  Planners know this and continue their intervention to moderate the rise of gold in terms of Dollars.  When the broad market finally responds to the manipulation and intervention, the price of gold will shoot up quickly.  Will it happen in 2013, 2014, 2015…?  Only Our Heavenly  Father knows.

Wealth is being created in Asia and thus gold is moving in the direction of wealth creation.  The Netherlands and Austria are now talking about bringing back their gold.  People want the physical asset, not just a claim.  This demand will continue to grow and accelerate as the debt of nations becomes larger and unsustainable.

The Bank of Japan has joined in to the notion of depreciating their fiat currency.  This is increasing “counterparty” risk of fiat currency.  Japan’s aging economy has been in negative territory for some time and they want to reinvigorate it.  Printing more money seems to be the easiest way to appear prosperous.  This is just another aspect of the currency war now in full swing.  Who can depreciate their currency faster?  They are doing this at great risk.

Given the fact that the average person cannot assess the risk of paper investments, gold appears to be the best protection against the coming volatility.

A “Short Squeeze” is a rapid increase in the price of a stock, bond, or commodity asset that occurs when there is a lack of supply and an excess of demand for the asset.  Speculators “sell short” the asset using a derivative of that asset hoping to buy it back in the future at a lower price.  They are required to close out their position with an equal quantity of the asset they “short”.

The Germans are now demanding their physical gold in lieu of holding a paper claim provided by the U.S.  A problem occurs when the central banks lease out their gold into the market.  That gold is removed from storage and a piece of paper is put in its place, a claim.  Germany could physically reclaim all their gold in seven weeks but instead plans to take seven years.  Why?  I suspect their gold is not sitting in storage and the U.S. must buy it back from the market.  Oops!

Venezuelan President Hugo Chavez demanded Venezuela’s gold back and got it.  Other countries are doing the same.  China and Russia are quickly and quietly adding to their gold reserves.  In the meantime, the U.S. is expanding its money supply at breakneck speed.  Thus whatever gold we have left will ultimately be unable to sustain the value of the U.S. Dollar if the global financial system were to return to some form of a gold standard.  Other countries are moving toward a gold standard after having been given devaluing dollars as payment for their resources.

The paper claims against gold on a worldwide basis greatly exceed the actual known supply of gold.  The same holds true for silver.  Once holders of those paper claims demand the physical metal, the price will skyrocket and somebody will be left out in the cold.

You must ask yourself these two questions:

1.  Why does Germany want their gold back?

2.  Why does it take seven years to get their gold back?

The answers are obvious.