We Are in the End Game

Kaye:  “I’m focused on the footprints of the powers that be — the Fed, and the BIS.  Their game is not over yet.  So, despite the bounce, we are seeing a continued follow through to the smash that started a couple of weeks ago, which is exactly what I told you would happen with gold and silver…

The objective would appear to be to try to touch the lows of late June.  We will see if they can actually make that happen.  I will say that a lot of gold is being lost by the West in the process.  By that I mean physical gold is transiting very rapidly from the West to the East.  That process is now accelerating because Asian buyers are very keen to buy into what they perceive to be an incredibly low, and without a doubt in their minds, an artificial price.

The implications are extremely serious for the West here.  The harder these guys push it, and the faster they try to push things lower, this is causing them to lose an immense amount of physical gold in the process.   We saw backwardation reappear for a brief period of time last week.

Prior to that the market had seemed to normalize, and, temporarily, the strains in the system appeared to have been relieved.  All of that has changed once again.  We are back to backwardation and strains in the system being readily apparent.  This is a real sign of stress in the system, and it should be of some concern to the entities who are trying to orchestrate or continue this smash.

There is absolutely no question that we are now very much in the end game.  Whether it’s the seventh, eighth, or ninth inning, who knows?  But we are in the end game.  We are at levels that everyone who has an interest in gold in Asia is stepping up to the plate and buying physical gold — The People’s Bank of China, the Reserve Bank of India, and even the BRIC countries.

Everyone who has an interest in gold of an important nature is stepping up at these levels.  They find sub-$1,300 gold to be extremely attractive.  We agree.  These countries know how this game is going to end and what they are doing is positioning themselves for this end game.”

Eric King:  “Is it possible that the massive physical gold demand can halt their efforts to smash the price?”

Kaye:  “There is always that chance, but that’s not the game plan.  These people may be evil, they may be diabolical, but they aren’t stupid.  All of this has been well-planned.  The Fed is getting what it wants — it’s getting cover for it’s massive counterfeiting scheme or what they call ‘QE.’

The ECB is getting cover for what they are doing in terms of bailing out the periphery of Europe.  So the Western central banks are getting what they want out of this without the price of gold misbehaving.  By that I mean it’s very important for them to anchor interest rates so that they can keep their own particular paradigm, or fantasy, going on as long as they can.

Anyone with a brain knows that what these people are doing is not sustainable, but as I’ve told you, they will sustain the unsustainable as long as they can.  And part of that game plan requires that gold be kept in a cage for the short-term.  Now the problem with this plan is that while the major central banks can digitally print all of the dollars, or all of the euros that they want to or that they need to print, they can’t print physical gold and they can’t print physical silver.

And as I said, there are clearly strains developing in the system that they are going to need to address, and I think they are going to need to address these strains very quickly if they are going to be able to prosecute this gold price suppression scheme for much longer.  I am doubtful that they have the ability to do it.

Most of the evidence, anecdotal and otherwise, is that they are running very short on physical gold.  Certainly the Comex inventories are running very low.  The Fed itself would appear to have very little gold on its own account that they can continue to lend into the system.  The same can be said about the ECB.  How much of the 1,300 tons of the gold that mysteriously left the Bank of England is still available is open to question, but it would appear that a lot of that gold has already been used to meet this unprecedented and insatiable demand.

So I would say that the fourth quarter of this year is most likely the end game.  And as we get into 2014, the risk/reward is such that it is highly likely we will see a slingshot effect much higher for the price of gold.  I would project a price of $2,000 to $2,500 an ounce for gold by the end of 2014, and quite possibly $60 for silver.  Meaning, once this short-term noise is over, the reward in the next year for patient investors will be staggering.