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IPFS News Link • Central Banks/Banking

Central Banks Continue Their Debasement

• http://www.thedailybell.com

A heavily divided Federal Reserve left short-term interest rates unchanged but said the case for a rate increase "has strengthened", in a strong signal that a move is likely before the end of the year … Three out of 10 of the US central bank's rate-setters voted against the decision, and called for an immediate increase. But the Fed said that for the time being it wanted to keep policy on hold as it waits for further evidence of progress towards its objectives, leaving the target range for the federal funds rate at 0.25 per cent to 0.5 per cent. -Financial Times

Nothing happened again on Wednesday just as predicted. The Fed didn't move and slightly more surprisingly, the Bank of Japan didn't do anything either.

But as we pointed out yesterday, such inaction is not surprising. The world is stuck in a holding pattern when it comes to money. Central banks will continue to print around the world until a final catastrophe is triggered and elites attempt to generate an entirely new monetary system, probably featuring the SDR currency basket as worldwide "money."

Central banks are mechanisms of monetary destruction. Since the advent of central banking, the dollar has been debased to one or two cents of its former value. And the world has been stuck in a quasi-depression for some seven  years. This is not a coincidence. The whole point of central banking is to create economic pressure that demands further – centralized – "solutions."

In this case, sooner or later, there will be significant price inflation and perhaps credit collapses as well. Central banks may have printed up to $50 trillion in excess currency since 2008 and sooner or later this money will circulate.

While the outlook is grim indeed for the larger global economy, money metals are shining a good deal more brightly. The pressure on gold and silver prices relative to the dollar has abated a little with Deutsche Bank's admission of metals price manipulation.

The Motley Fool tells us:

Silver could be looking a lot more lustrous in the coming years … With physical gold up more than $250 an ounce year-to-date (24%), 14 of the 22 gold mining stocks that have market valuations of $300 million-plus have more than doubled in 2016.

Upward momentum has been even more pronounced among physical silver and silver mining stocks. Spot silver prices are up better than $5 an ounce (37%) year to date, with all six of the silver miners valued at $300 million or more at least doubling in price. These stocks are the true standouts this year.

Part of the case for silver in particular has to do with demand for silver as money – coins and bullion. Also, demand from the jewelry and silverware industries

Total physical demand is up some 17% since 2012, while prices have fallen by nearly half. Additionally rates are very low and thus a purchase of gold or silver doesn't sacrifice much in the way of ongoing income.

One ought to consider the silver/gold ratio as well. In the 20th century, gold's per-ounce price was an around 47 times that of silver's. But at current prices, the ratio is around 69. Let silver merely move to back to its 20th century average and we'll see prices around $29 an ounce. This sort of price potential is beneficial for gold and silver mining stocks as well.

Some News About DB Sponsor Golden Arrow

DB sponsor Golden Arrow has recently advanced mine permitting at its  Chinchillas Silver Project. An Environmental Report ("ER") has been submitted  to the mining authority in the Province of Jujuy.

This report initiates formal permitting for mine development and is part of the Chinchillas Project pre-development activities funded by Silver Standard (as per the proposed combined mining business with Silver Standard's Pirquitas mine announced October 1st, 2015).

"The filing of this report is a major step forward for the development of Chinchillas with Pirquitas, and we are confident that the stakeholder review will yield a positive outcome. We are now finishing the pre-feasibility studies and look forward to a decision from Silver Standard by the end of the year," stated Brian McEwen, Golden Arrow VP Exploration and Development.

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