Decoding The Elite Plan For The World Economy - Mike Maloney On Federal Reserve Strategy

what if you could see the future what if you knew what the markets were going to do before they did it what if you knew the ultimate destiny of stocks and real estate but especially gold and silver what if before 2007 you had found a manuscript that accurately predicted many of the financial events of the last decade and most likely the next decade i found such a manuscript back in 2003 and i'm going to show you it's incredible accuracy today it's a play actually and it's been seen by more people than any play in history the live performance started back in 2008 and it continues until this day however very few people read this manuscript and in advance and took action and benefited from knowing the future and the name of the author is benjamin shalom bernanke his play is deflation making sure it doesn't happen here first read before the national economists club in washington dc in november of 2002 and some background on this all of the world's central bankers the people that run the global economy they are all keynesians they believe in the theories of this man john maynard keynes these economists though they all tend to use a whole bunch of gigantic words and they want to sound really smart and it makes people think that they can't understand economics and economics is actually quite simple so one of my jobs is decoding ben bernanke is a cryptographer and he creates a complex language that is hard to see through there is this smoke and mirrors fog going on and i'm going to be reading just a little bit of his speech now some definitions keynesians versus austrians keynesians are the people they're the economists that have been wrong and austrians are the economists that have been right austrians believe in a fixed currency supply they believe in the free markets they believe in the free market actually picking what money is and they prefer gold or silver or a gold standard keynesians believe in an elastic currency supply where the government can do a bunch of deficit spending and basically spend into the wind in a downturn they can create currency and spend it and try and get the economy going the problem is uh the elastic currency supply never comes back the way our currency the way the monetary system is designed is it always has to expand forever or the whole thing collapses in a deflationary implosion so keynesians versus austrians versus gold uh the austrians you know i said that they believe in a gold standard and which keeps inflation from happening creates stable prices and it's something when you're using gold as currency the government can't manipulate it because they can't print it keynesians are the people that guarantee that gold and silver are going to far higher prices than today and their purchasing power will go up we have the keynesians to thank for the opportunity that we have in investing in gold and silver right now because they wouldn't be so severely undervalued if uh if we were under the rule the leadership of austrian economists running the world economy so strap in this is going to hurt a little bit but really pay attention to this because what ben bernanke wrote has affected everybody on this planet especially people in the western countries the western civilizations it is very important you're going to see that you can make huge gains if you understand what's going to happen and so i'll get into his speech here and i'm only going to be reading you about two percent of his entire speech deflation is in almost all cases a side effect of a collapse of aggregate demand now aggregate demand that means the aggregate is everybody that's like the entire nation or the entire world demand is the stuff that we want to buy so basically he's saying that deflation is because people don't want to buy stuff and this gives you a glimpse into the mind of keynesians keynesians believe that the economy is this machine with gears in it and you put an input here and there's an output there that's equal and opposite and that you can describe this thing with a formula and it's always going to react the same to your inputs but if deflation is because people stop buying stuff what caused them to buy stuff something came before that the collapse of aggregate demand is a reaction it's not the cause of deflation the cause of deflation is either people getting scared because something happened like a stock market bubble popped or there was terrorism like 911 and they stop buying they they don't take their friends out to dinner and they don't buy a new suv instead they sit at home and they eat rice and beans and it could be because of fear or it could be that they're just up to their eyeballs in debt and that they can't afford to buy any new stuff because they're paying off the old stuff so now this this part is where it starts to hurt to listen to this guy ben bernanke is not a very good author so if you ever get a chance to read some ben bernanke please don't deflation of sufficient magnitude may result in the nominal interest rate declining to zero or very close to zero once the nominal interest rate is at zero no further downward adjustment in the rate can occur since lenders generally will not accept a negative nominal interest rate when it is possible instead to hold cash now right here ben bernanke is telling us that he doesn't believe in negative interest rates are possible that that's an impossibility and negative interest rates have only even been a a notion something that people thought might work since 2008. for the last 5000 years this has been something that has never occurred and actually negative interest rates are proof that keynesian economics doesn't really work if you were a student in college back in 2007 before the crisis and you raised your hand and said professor let's talk about negative interest rates for a little while that professor would have said sit down and shut up kid there's no such thing nobody is going to pay for the pain of deferred gratification of lending currency to somebody for 30 years instead of spending it now and enjoying it they're not going to pay for that they're not going to pay for the risk that you take on that you're not going to get paid back and so it's it's not something that will ever happen it's never happened before you better shape up or ship out or you're going to flunk my class so uh the negative interest rates that's positive proof to me that keynesian economics doesn't work these are government bond yields countries that represent one quarter of the world's gdp now have negative interest rates and switzerland the bastion of conservative finance now has negative interest rates on a 30-year bond and obviously people are willing to loan a government currency for 30 years and pay for the privilege so we're in really uncharted territory but at this point the nominal interest rate is said to have hit the zero bound now i'm going to recap all of this later and put it in real succinct straightforward language for you but when the short-term interest rate hits zero bound the central bank can no longer ease policy by lowering its usual interest rate target they have a target they don't always reach that target but they manipulate short-term interest rates to try to reach that target all the time because the central banks conventionally conduct monetary policy by manipulating that we don't have a free market they're manipulating the cost of currency the short-term nominal interest rate some observers have concluded that when the key rate stands at or near zero the central bank has run out of ammunition and that it is no longer that it no longer has the power to expand aggregate demand and hence economic activity it is true that once the policy rate has been driven down to zero a central bank can no longer use its traditional means of stimulating aggregate demand and thus will be operating in less familiar territory the central bank's inability to use its traditional methods may complicate the policy making process and introduce uncertainty in the size and timing of the economy's response to policy actions i know this all hurts but it'll get good in a second here however a principal message of my talk today is that a central bank whose accustomed policy rate has been forced down to zero has most definitely not run out of ammunition indeed under a fiat that is paper monetary system a government in practice the central bank in cooperation with other agencies should always be able to generate increased nominal spending and inflation even when the short-term nominal interest rate is at zero like gold u.s dollars have value only to the extent that they are strictly limited in supply but the us government has a technology called a printing press or today its electronic equivalent that allows it to produce as many us dollars as it wishes at essentially no cost by increasing the number of us dollars in circulation or even by credibly threatening to do so the u.s government can also reduce the value of a dollar in terms of goods and services which is equivalent to raising the prices in dollars of those goods and services we conclude that under a paper money system a determined government can always generate higher spending and hence positive inflation what now a lot of you understood that but he does insert an awful lot of unnecessary words so this is ben bernanke the nerd uh and this is cool ben the guy that uh is going to level with you and tell it to you straight and so all you have to do is read the words that are in red and skip everything else some observers have concluded that the central bank has run out of ammunition the central bank has not run out of ammunition under a paper money system the central bank should always be able to generate inflation u s dollars have value only to ex the extent they are strictly limited in supply but the u s government has a printing press that allows it to produce as many dollars as it wishes by increasing the number of us dollars in circulation the u.s government can also reduce the value of a dollar a determined government can always generate inflation so that's what he said in that that big long speech which was only about one percent of the uh of the entire speech but what keynesians don't seem to understand is that it's a motion that runs the economy in the short term the bubbles that happen the bumps and dips along the road in the economy are all from people's fear and elation if they're feeling good they take their friends out to dinner and so on if they're not if they're afraid because of some it could be a natural disaster it could you know terrorism war there's a whole list of reasons that people suddenly become afraid lately it's been bubbles that pop and all those bubbles were created by these keynesian economists but velocity is the thing that emotion determines and velocity is how many times a dollar or any unit of currency changes hands in a specified period of time economists usually use a one year period and that determines the gdp here we have a country of uh just 10 people so this economy has 10 people and their entire currency supply is just one dollar and if that dollar is involved in one transaction that country now has a gdp of one dollar times one transaction equals a one dollar gdp if it's involved in a second transaction that one dollar currency supply has created two dollars of gdp and then if it's involved in a third fourth fifth sixth seventh eighth ninth tenth transaction one dollar of a currency supply created ten dollars of gdp we teach this how many here have has anybody here seen hidden secrets of money great how many here have seen hidden secrets of money episode seven the day of reckoning okay if you really i mean we make this stuff so simple for everybody and it's important to understand all of this stuff because we were left a road map and we can turn that road map into a treasure map if we understand the road map ben bernanke wrote this road map back in 2002 it was posted on the fed's website for everybody to see but very few people paid attention to it they there was a few newsletter writers that pulled out a couple of lines like the printing press thing and the dollar having uh value like gold because it's limited in supply but other than that people didn't really digest it and try and break it down and turn it from a road map to a treasure map because if you knew what was coming you could bet on it and i saw what was coming and i bet my life on it i wrote my book around it and i created hidden secret secrets of money all around this one speech that ben bernanke made and i read his book essays on the great depression and i also uh read many of his papers and so on so this is u.s based currency they call it the monetary base or the base money supply it's not money u.s currency like all fiat currencies on the planet our currency we do not use money we haven't used money for many decades money one of the functions of it is to be a store of value and because of the way the currency system is designed the monetary system all fiat monetary systems cannot store value because when we create a unit of currency it's borrowed into existence and we promise to pay it back with interest and the interest doesn't exist the currency to pay the interest does not exist yet so you we always have to go deeper and deeper and deeper in debt as a society to be able to have currency circulating and so this monetary system its design cannot survive uh a static you know if there isn't any extra currency being created because it'll go into a deflationary implosion to understand that fully you need to watch episode 4 of hidden secrets of money but what happened here is base the velocity of that base currency fell to exactly offset the creation of all that excess base currency so it didn't end up creating any retail price inflation back in 2009 10 and 11 all of the newsletter writers were screaming hyperinflation hyperinflation hyperinflation and i was saying we're going to be going into deflation first this will just bring on a big inflation or reflation and we've seen that in the stock markets all of the asset prices have been inflated since the crisis of 2008. so back to ben normally money is injected into the economy through asset purchases by the federal reserve this is very well explained in episode four of hidden secrets of money the greatest scam in the history of mankind is the title and basically the federal reserve has a checkbook but there is no currency in that uh checking account and uh it's it's it's got a zero balance and they we created an entity an organization that has the legal authority to counterfeit currency they write a check on a zero balance checking account currency springs into existence and then they get to purchase an asset with that counterfeit currency so they get to go into the markets and buy stuff and compete with us and drive prices up and bid those uh goods those the assets away from us and so it's a very very immoral system it's just absolutely wrong uh everybody really needs to understand this and your own livelihood your your prosperity in the future will increase if you understand all of this stuff to stimulate aggregate spending when short-term interest rates reach zero the fed must expand the scale of its asset purchases so cool ben the fed must expand the scale of its asset purchases let's see how they did well these are u.s treasuries so it's u.s treasury bonds and you can see that you know it took a couple hundred years for them to well a fed was created in 1913. we had zero dollars in existence in 1776 the dollar was created in the coinage act of 1792 and uh but we were up at about 0.8 trillion or 800 billion dollars of treasuries that the federal reserve had had purchased with dollars that were created from nothing and they get to buy these bonds and bid them away from us then we went into the crisis of 08 and they gave all of those high this high quality debt u.s treasury debt to a bunch of banks that were basically insolvent and took a bunch of bad assets off of those banks balance sheets so for a while the paper dollars in circulation the base currency was backed by a whole bunch of crap that the fed had taken off of their balance sheets but then they started qe1 qe2 qe3 and now they've got almost uh two and a half trillion dollars worth of u.s treasuries that they bought with counterfeit currency and when they are in the market buying these things they bid them away from us that's what caused yields to go down to zero is them doing all of this buying it it raises the price of the bonds so you can check that one off as job done he wrote it in 2002 they did it in 2009 2010-11 2012 and 13. so he wrote this thing in 2002 and it came true that's the reason that this is important uh watch episode four of hidden secrets of money it's all uh it's it's a 20-minute animation that takes you through how the world monetary system works or the fed could possibly expand the menu of assets that it buys now remember menu of assets we're going to come back to this later i'm not going to check how they did on that one right now one important concern in practice is that calibrating the economic effects of non-standard means of injecting money may be difficult given our relative lack of experience with such policies if we do fall into deflation however we can take comfort that the logic of the printing press example must assert itself and sufficient injections of money will all will ultimately always reverse a deflation cool ben okay one important concern in practice is that calibrating the economic effects of non-standard means of injecting money may be difficult given our relative lack of experience with such policies calibrating the economic effects may be difficult given our lack of experience that's what he was saying however the printing press must assert itself that's sort of scary let's see how he did so that was written in 2002 and they lit up the printing presses in 2009 and they're they're going to again this hasn't stopped so with the next crisis they will they will do this again so you can mark that one done check it off your list so what then might the fed do if its target interest rate fell to zero so they're targeting zero uh one approach would be for the fed to commit to holding the overnight rate at zero the overnight rate is called the fed funds rate so let's see how they did there and what you see here is that from 2009 to uh the end of 2015 here that interest rates were at zero so you can check that one off the list it came true and he wrote it in 2002 not 2008 or 2009. now this is inflation adjusted so it's the fed funds rate divided by the consumer price index and what you see here is that we've been in severely negative territory ever since the crisis of 08 with brief blips up into positive territory lower rates over the maturity spectrum of public and private securities should strengthen aggregate aggregate demand in the usual ways and thus help end deflation lower rates should end deflation so how are they doing ending deflation this is the consumer price index and what you see here this goes all the way back to 1914 and you see the inflation of world war one the deflation that was called it's when i first wrote about this back in 2005 i was the first person to call this a a depression because the contraction of prices especially wholesale prices wholesale prices the contraction was twice as bad as the great depression and milton friedman had this in his book a monetary history of the united states so we had this deflation and then we had the roaring 20s which if you read murray rothbard or milton friedman was a federal reserve induced bubble that then popped and you've got the big deflation of the great depression but then we've had positive inflation all the way until the crisis of 2008 and this brief dip and uh here we have inflation their target rate is be they what they want inflation to be at is they want a buffer above zero so that we don't fall into deflation of two to three percent and they've only been able to achieve one percent here and uh in the second quarter of 2015 uh it went back into deflation so even with that massive currency creation and zero interest rates they're not achieving their goal of two to three percent inflation another positive proof that keynesian economics doesn't work remember this where i said or where ben said or possibly expand the menu of assets that it buys so yet another option would be for the fed to use its existing authority to operate in the markets for agency debt for example mortgage-backed securities he wrote this in 2002 the crisis of 08. before that they didn't have any mortgage-backed securities on their balance sheet and now they've got 1.75 trillion dollars worth of mortgage-backed securities and what what backs a mortgage-backed security a mortgage the federal reserve bought one 1.75 trillion dollars worth of real estate and uh so they are the largest holder of real estate in the world and they bought it with currency from nothing and people are now buying there the people that are making payments on these homes by the way you never actually own a home you only rent it if you stop making your tax payments on your home you're going to find out who really owns it but uh 1.75 trillion dollars worth of real estate that they bought with counterfeit currency that they were allowed to whip up from nothing and that bids prices away from us they're scared to death of deflation because the monetary system that we currently operate under will not operate under deflation so now we're going to talk about fiscal policy everything before this was monetary policy it's the policy that the the central banks set as far as how much currency they're going to have in the system and what interest rates are going to be that's the way that they manipulate things monetary policy this was a section at the bottom of his speech or fiscal policy this is a section at the bottom of his speech and fiscal policy is the policy that the government sets fiscal refers to the treasury of a government or tax revenues but it can also refer to just plain old finance but what they're talking about here is the government's responsibility to prevent deflation so what could the government do the government a broad-based tax cut for example accommodated by a program of open market purchases to alleviate any tendency for interest rates to increase would almost certainly be an effective stimulant to consumption and hence prices so what he's really saying here is a broad-based tax cut to accommodated by open market purchases that means that they're going to do he was writing that what they could do is do tax cuts and tax rebates and then they would fund that the government would issue a treasury bond and the federal reserve through open market operations would write a check for it and create the currency and that's where the government would get the currency to give you back to refund you on your taxes or give you as a tax cut and that that would be an effective stimulant to prices so that would cause inflation by giving everybody a tax cut and a rebate now the silly thing about this is the government has to issue a treasury bond which is an iou and they promise they borrow currency they're borrowing it from the fed who gets to just create it out of thin air but it has to be paid back by all of us working in the future and paying taxes to pay for the tax break the tax cut and the tax rebates that they're going to give us today this is an insane plan it's a uh a circular loop where we end up having to pay for our own tax breaks and we pay for it in the future so they haven't done that one yet i'm going to reserve judgment on that with the next crisis i think they will do it a money finance tax cut is essentially equivalent to milton friedman's famous helicopter drop of money of course in lieu of tax cuts or increases in transfers the government could increase spending on current goods and services or even acquire existing real and financial assets so the real or you know the government could acquire real or financial assets real means real estate that's what he's talking about there and financial assets they're talking about stocks and bonds there's talking you're talking about stuff that trades on the markets so the government could acquire real estate and and stocks and bonds and bid them away from you raising their prices making our lives more expensive so how did they do this is from zero hedge and this is b of a says that 45 percent of the global bond market is now compromised by central bank buying the market's attention this week was focused on the bank of england's decision to purchase 10 billion pounds in corporate bonds so that corporations over the next 18 months by doing so mark carney like mario draghi has opened up a pandora's box so these are central banks now buying up private assets that with currency from nowhere the immorality of it is bad but also the governments and this and the central banks which are not part of the governments end up owning everything what is a society where the government owns everything that's a communist society that's not a free society so you can check that one off the list he wrote it in 2002 we've done it if the treasury issued debt to purchase private assets and the fed then purchased an equal amount of treasury debt with newly created money the whole operation would be the economic equivalent of direct open market operations in private assets so that the treasury should purchase private assets that's what he's saying treasury to purchase private assets did they do it well during the crisis of 08 fannie and freddie are government-backed agencies but they're private they're just the government is guaranteeing that they're not going to go under but they had stockholders you could buy stock in fannie and freddie aig is a private insurance company so we've got 187 billion that they whipped up and gave to fannie and freddie 183 billion that they gave to aig the fannie and freddie deal uh the they've lost uh quite a bit of money on that so far i believe over 30 billion and fannie and freddie are still in trouble aig they were they bought that at a low because it had crashed and by bailing them out it survived and they sold that stock and they made 11 billion so you can check that one off the list he wrote it in 2002 they did it this is from wikipedia the general motors uh bailout does anybody remember general motors and chrysler being bailed out during the crisis uh the purchase was supported by 50 billion dollars in u.s treasury loans giving the government a 60.8 percent ownership stake in general motors and then this is from wikipedia and people edit wikipedia it's not always the but they put in links to prove their uh their sources the queen of canada they're talking about queen elizabeth here of of england in right of both canada and ontario and these were links that go to a page that shows that the queen of england actually owns many of the public assets of canada holds 11.7 percent and the united auto workers hold a further 17.5 the remaining 10 is held by unsecured creditors but the point is the federal reserve went in and funded the government to buy 60.8 of general motors so this script for what was going to happen in the global economy was written in november of 2002 and very few people paid attention to it and if you take a look at what has come you know to understand it better uh please go to youtube put in hidden secrets of money the greatest scam in the history of mankind the roller coaster crash and the day of reckoning this one is why we have to go into deflation before we can go into big inflation or hyperinflation and i bel and so far everything that i've written has been playing out it's not done yet this one is about the future and it's based ben bernanke wrote most of the script here script here he also wrote the script for my book which is the best-selling book on investing in gold and silver the predictions that i made were all based off of that paper in 2002 and they have all been coming true so the crisis is still going on today you know when there's a crisis it echoes around the world and here is you see uh qe1 this is the blue is the federal reserve bank of england is green bank of japan is red the european central bank is yellow so quantitative easing one quantitative easing two quantitative easing three but right now they're creating the equivalent of 180 billion dollars every month and so the emergency that is going on in japan and in europe has not ended and the world is so globally connected with the next recession we are going to see one hell of a crisis and this is going to explode right off the top of the screen here all of this currency creation so once again they said they would expand asset purchases hold interest rates at zero they would print currency they would expand the menu of assets uh tax cuts and rebates they haven't done that they would buy real estate and financial assets they would buy private assets they would end deflation uh they haven't actually uh done that to what i can see the the rate of inflation is descending right now they have a target and they're not able to reach it i'm going to withhold judgment on these and see how they do because i believe that with the next financial crisis you're going to see all of these repeated and it will probably be on a much larger scale because in order to get the same we we now have a base currency supply that instead of 0.8 trillion it's up at about 3.8 trillion so they've got to do roughly the same percentage increase off of 3.8 trillion to get the same economic pop that they got from the uh extra currency that they created in 2009 10 11 12 13. uh and uh they will end deflation one day and what i think is going to happen is they will print enough currency until the public the the thing that's going to cause the deflation is the baby boomers getting scared you'll see that in a moment and saving it's a quarter of the of the u.s population 75 million people that haven't saved enough for retirement and they're going to see their iras and 401ks shrink again just like they did after the peak in 2001 just like they did after the peak in 2007 so gold and silver are the only financial assets that come with a central bank guarantee how does the central bank guarantee them your guarantee is that the central banks will never stop printing currency and they can't even if they tried to make the decision we're going to stop printing they can't they have to if they stop printing base currency what they have to do is encourage the banks through fractional reserve lending to create more credit currency if they don't the whole system goes to into a deflationary implosion gold and silver have always been considered the ultimate safe haven asset and in the next crisis you're going to see the people that have been burned on stocks three times in this century and real estate twice and they're basically out of time they're just going to start saving and paying down debt and then you know we're at the end of a 35 year old bond bubble right now bonds have been going up in price and down in years for down in yield for that many years and uh this isn't going to be pretty when it ends the bond bubble is the biggest bubble of all uh this is so what did we get for zero interest rates and all of this currency creation over that period of time this is real gross domestic product so it's real gdp it's the percent change so it's it's the rate that we're growing at the gray bars our recessions the black space between the gray bars are the economic expansions and another thing that i want to point out while i'm here is uh we are now about to become the it's the third longest economic expansion in history that we're but we're about to overtake this one right here back in the 80s then there was a longer one in the 60s and a longer one in the 90s but at nine months from about a year from now nine months from when we become the uh third longest we will be it'll be the second longest and then the normally these only last about four and a half years there have been uh i believe 45 economic expansions in the history of the united states and uh so the percent chance of this going i believe that we're either already in a recession or we're right about to start one because so many economic indicators show it but if you look at the rate of growth between these these recessions the average rate of growth is declining and all of that currency and those negative interest rates this economic expansion that was that for the very first time was not the free markets it was purchased it was bought by the federal reserve gave us the weakest economic expansion in u.s history and what's worse is looking at this trend and the trend here now if you go back to uh just after world war ii uh the debt to gdp of the country we had a lot of debt left over from world war ii but private debt to gdp was very low we had just come out of the great depression and people were very very debt averse they did not want to take on new debt so people had a lot of room to expand this is a result of of private individuals and businesses being deeper and deeper and deeper in debt and it's a very very bad trend so this is the monetary base again so it's it's base currency this is the value of the stock market it's the wilshire 5000 total market cap index and what you see here is zero correlation before the crisis of 2008 and then suddenly there's this astounding correlation that is so spot on that it's an absolute impossibility that this is a coincidence that is not a possibility this is the the rally in the stock markets is a purchased rally this is something that the federal reserve created but if you look right here the it's a very very close correlation and then they stopped qe the training wheels came off and the stock market went up and then it crashed right back down to base currency it went up again it crashed back down and now the divergence between the two is the greatest since 2009 the stock markets by any measure dividend yields p e ratios are in a severe bubble and it's going to be correcting with the next recession which is definitely right around the corner because it's impossible for these economic expansions to go on forever they never have we should have a recession very very shortly here and what you'll see is that not only will this fall to this will follow the base currency and right through it because they're going to launch base currency to the moon now this line is the government income this is federal government current tax receipts and what's interesting about that is there's no correlation until we get up to about 1998 with the long-term capital management crisis and then there's this spooky correlation that the government income is reliant on how well the stock markets are doing i call that the financialization of government never before has the government been been totally reliant on the stock markets being successful the last time that the stock markets went down with this that the income of the federal government went down with the stock markets was the crash of 1929. if you go back that far you'll see something very similar to this right here but it then got this correlation with the creation of base currency until qe3 and then there's this divergence where qe3 enriched the stock markets it's the bubble economy it's the fake economy and main street the part that pays taxes you and i we didn't share in these riches here and so uh this this is all a recipe for disaster what is going to happen is when the stock market crashes and base currency launches to the moon uh the government has to do a ton of deficit spending so you're going to see these trillion dollar deficits and multi-trillion dollar deficits in the next uh recession because uh this is going to fall with the stock market and they won't have the revenues for all the spending that i mean we've got deficits now this is one of the problems with all governments whenever times are good they ramp up their spending to spend every every dime that they're getting in income and then some and then a crisis happens and they haven't put anything away to deal with the crisis uh so i hate to burst your bubble but your bubble's gonna burst the public has been betting on the wrong horse and they've been doing it for the whole century this is gold it's percentage change from uh the beginning of this century and this is the s p 500 way down here so the the stocks are up 50 in the last 17 years gold is up 400 in the same period of time and i don't care about this five year pullback here that i that doesn't make any difference to me uh i measure gold and silver's purchasing power over very long time spans and they are still undervalued in my opinion severely undervalued they're going to far higher prices and purchasing power it isn't the price that matters it's how much stuff you can buy with the proceeds so why will this crisis be deflationary because when the stock market peaked here and then crashed the baby boomers still had 15 to 20 years when uh the real estate bubble happened and the stocks went back up so they're they're iras and they're 401ks you know here they're iris and 401ks lost 40 if they were invested in the s p they lost 60 70 80 if they were in a bunch of nasdaq stocks and then uh they it recovered during the real estate bubble and the stock market going back into a bubble and then this crash took uh high quality stocks that they're in the s p down about 60 percent so their iras and 401ks went down with that and if they were in real estate a whole lot of them got completely wiped out and then it recovered and now it's way up here except this is the s p adjusted for inflation now the thing is during this whole ride where they've been losing in value on stocks they were contributing every month to their ira and their 401k so they see the total balance either staying the same or growing so they didn't feel bad about these losses in stocks but this is the purchasing power the stocks that they bought here had far less purchasing power down here and it probably dropped close to 90 percent in this uh bottom here now it's gone up uh people are happy because their iras and their 401ks are three times what they were at the bottom in 2009 and uh so they're they're real happy up here but if you look at it the stocks that they bought here are basically back to where they were 17 years ago so uh the stock market has been a loser precious metals have been the big winner that's gold measured in price for the entire bull market it's a 20-year chart and this is gold inflation adjusted it's up 366 so you've got 266 percent gains over where you were compared to zero inflation adjusted for the stock market uh this is silver and it is also up about 3.6 times its original price and it's also up about 266 percent in profit when you inflation adjust it um actually it's up five times its price 400 percent uh and then uh 266 gains inflation adjusted the gold silver ratio uh now there's probably how many people in here trade on the gold silver ratio okay i see one back there two there's so this is uh also a road to wealth but whenever you trade i believe you introduce risk but whenever uh the line is in silver silver is outperforming gold and when it's gold gold is out performing silver and when ever the gold silver ratio is up above here i'm buying only silver on these peaks when it's down in this range i buy a mixture of gold and silver and when it dropped below 50 during this entire portion here i bought no i buy every month but i did not buy silver during these months i bought only gold and then when this got up back into this level right here i sold that gold and i bought silver with it and i got 1.8 times more silver than i paid for by doing that and so we're way up here where it's silver that is the bargain but one thing that's interesting here head and shoulders patterns how many people know what a head and shoulders pattern is okay it's one of the most reliable indicators in charting and what you see here is a head and shoulders pattern and it broke the neckline and it played out but now we're creating a larger head and shoulders pattern which means silver should outperform gold i've got eight minutes left so i gotta hurry people always ask me when should i buy and i would always give this technical explanation you can wait until it drops back to the 200-day moving average or you could do some fibonaccis or you could dollar cost average in which is what i do but my business partner my former business partner pointed out to me about five years ago that what they're actually asking is they wanna they they wanna say so when is the crisis going to happen when do i have to buy i want to stay invested in all these stocks and real estate and the stuff wall street and jim cramer is telling me to be invested in i don't want to invest in gold and silver i want to know when i have to invest in gold and silver so that i can sell all that wall street stuff and buy just before the crisis and so i would give them these technical explanations and they would walk away and they would not buy so now my answer when somebody says so when should i buy i say you should buy in 2001. if you can't do that then you should buy in 2002 like i did and if you can't buy in 2002 then 2003 when i saw dave morgan at a cambridge house event up in vancouver and i i found out from him how undervalued silver was compared to gold and i started taking a position in silver in april of 2003 or you could buy in 2004 five six seven eight when uh during that dip when silver dropped uh it dropped down below nine dollars and i more than tripled my position in silver in 2008 during that dip uh or you could buy in 2000 uh 9 10 11 12 13 14 15 and i bought in all of those years i because i was using that gold silver ratio i did not acquire any silver up in the 40s or 50 you know up in the 40s and or you could buy in 2016 or you could buy in 2017 and you'll still be getting a good price but i wouldn't wait until the crisis when it's really going to be too late and you're not going to be making a profit i don't know if this is going to happen in 2017 2018 2019 2020 but it will happen and then so yeah the public has been betting on the wrong horse and basically i decided to pick one i i didn't uh take 10 of my portfolio all these people that say you should just take 10 of your portfolio and invest in in precious metals because it's dangerous it's volatile it's a stock market that's dangerous and volatile gold can't go to zero and a stock can that company can go out of business so i've got a breakout session at 2pm in silver hall online people that are watching this online should click in the top right hand corner to see it and so that session we're going to be talking about some of the following in order to take interest rates more negative they have to ban cash and that means digitizing currency it means going to blockchain technology which then gives the entire monetary system a single point of failure the internet it's a very dangerous thing to operate all society globally on a single point of failure and so what we have to be worried about is world war e that's uh going on in cyberspace right now and uh a little while ago the u.s took the first shot in creating this a war between nations we developed a virus and we'll talk about that in the breakout session to attack iran and and the possibility of world war iii now you do not want this to ha you don't want gold to rise because this is happening but if uh you heard on the radio today that we were at war with russia or china gold would gap up to five thousand dollars an ounce and then ten and maybe twenty who knows but uh you know when i grew up this is what i was taught uh that the that communism is going to take over the world and we've got to defend vietnam because if we don't countries are going to fall like dominoes and the communist threat is going to take over everything that's what we were taught but the soviets saw the world from an entirely different perspective that we were taking over everything so they've got a good reason to think they're under threat russia wants war look how close they put their country to our military bases so there are these brief moments in history where the safe haven asset gold and silver that have been the safe haven for 5 000 years also become the asset with the most potential gains in absolute purchasing power and we are in one of these brief moments right now it doesn't happen very often and you know most of you you're smart people you're here the public though they aren't taking advantage of this brief moment so in the next crash what will they do the government and what can you do that's what we're going to talk about in the breakout session also the mission of hidden secrets of money the free video series and these things are not cheap to produce uh is to enlighten the world that maximum prosperity can only be achieved through individual freedom free markets and sound money the sound money part is why we're here the mission of goldsilver.com is to get as much gold and silver into private hands before the crisis not after it and so this is our website we're one of the major online retailers we've got a price match guarantee we've got some of the lowest prices in the industry industry we're education driven we have an insiders program where i update people on what's going on the education the episodes of hidden secrets of money you know we spend a few hundred thousand dollars a piece on those things and they're free we fund it through this so when you buy from us you're investing in education instead of banner ads so give us a try sometime i think you'll like it our breakout session is over in the silver hall at 2pm thank you very much you

Channel: GoldSilver (w/ Mike Maloney)

Views: 1,401,394

Rating: 4.8142872 out of 5

Keywords: gold, silver, gold and silver, mike maloney, buy silver, buy gold, silver bullion, bitcoin, invest, money, bullion, precious metal, precious metals, hidden secrets, Hidden secrets Of Money, 500oz, gold price, silver price, mining stock, Federal Reserve, rate hike, fed, decode, real estate, bubble, dow, trump, republican, jobs, putin, russia, ww3, bernanke, zero, zirp, interest, zero interest rates, negative, negative interest rate, nato, russia vs usa, recession, dollar, CNN, tax, wall, mexico

Id: Q3BjMUd391c

Length: 56min 48sec (3408 seconds)

Published: Tue Nov 22 2016

Reddit Comments

[u/BTC_Forever]

great video!

[u/easyusername1]

He answers in the comments that he likes and owns bitcoins.