Golden Rule: Interest Rates Do Not Influence Precious Metal Prices

https://www.parametricportfolio.com/insights-and-research/interest-rates-do-not-influence-precious-metal-prices

Here Is One Very Simple Reason For Why Gold And Silver Were Massacred This Week… And Why Prices Will Rise Soon

http://www.shtfplan.com/headline-news/here-is-one-very-simple-reason-for-why-gold-and-silver-were-massacred-this-week-and-why-they-will-rise-soon_10072016

Worldwide Collapse And Prices For Gold & Silver That Are Unimaginable Today

http://kingworldnews.com/worldwide-collapse-and-prices-for-gold-silver-that-are-unimaginable-today/

40-Year Veteran – Surprises In The Gold & Silver Resale Market And How It Will Impact Prices

http://kingworldnews.com/40-year-veteran-surprises-in-the-gold-silver-resale-market-and-how-it-will-impact-prices/

Andrew Maguire – China On The Brink Of Winning The Gold War Against Corrupt West As Gold And Silver Prices Set To Skyrocket

http://kingworldnews.com/andrew-maguire-china-on-the-brink-of-winning-the-gold-war-against-corrupt-west-as-gold-and-silver-prices-set-to-soar/

If Prices Are Collapsing, Then Why Is Gold Going Up?

For hard monetarists, this is a good review of Exter's pyramid.

http://www.kitco.com/ind/Taylor/2015-01-22-If-Prices-Are-Collapsing-Then-Why-Is-Gold-Going-Up.html

Those Soaring Food And Gas Prices? The Fed Has A Name For Them: "Noise"

http://www.zerohedge.com/news/2014-06-18/those-soaring-food-and-gas-prices-fed-has-name-them-noise

Federal Reserve Admits Truth In Internal Memo: "Prices Continue To Rise Between 3% And 33%"

The Fed can't hide behind their lies of low inflation.  They admit to soaring food prices to justify price raises.


http://www.zerohedge.com/news/2014-05-24/federal-reserve-admits-truth-internal-memo-prices-continue-rise-between-3-and-33

Bitcoin Prices Plunge on Bust of Online ‘Black Market’

Buyer beware.

http://www.bloomberg.com/news/2013-10-02/bitcoin-prices-plunge-on-bust-of-online-black-market-.html

The Other Reason Why Gold Bullion Prices Could Skyrocket

http://www.business2community.com/finance/reason-gold-bullion-prices-skyrocket-0618336#m5WBwu6P4gmZCu1P.99

Soybean, Corn, And Wheat Prices Are Surging

Crops would be a good store of value also, but they rot.  A barrel of crude oil would be a good hedge against inflation and USDollar debasement also, but it's difficult (as well as dangerous and probably illegal) to store in your garage--and you can't put it in your pocket and bug out if the $hit were to hit the fan.

Stick with gold and silver coins and bars.

http://www.zerohedge.com/news/2013-08-26/soybean-corn-and-wheat-prices-are-surging

10 Items Whose Prices Have Jumped the Most in the Past 10 Years

This is further evidence that the CPI data published by the BLS is "understated".  Or in less polite terms, inflation data released by the government are a bunch of lies.

"There are three kinds of lies: lies, damned lies, and statistics." - Mark Twain

http://finance.yahoo.com/blogs/the-exchange/10-items-whose-prices-jumped-most-last-10-200433174.html

Mike Maloney: Today's Low Gold & Silver Prices Are Not Realistic

http://www.peakprosperity.com/podcast/81512/mike-maloney-todays-low-gold-silver-prices-not-realistic

SHALE AND WALL STREET: WAS THE DECLINE IN NATURAL GAS PRICES ORCHESTRATED?

Technological advances (such as horizontal drilling and fracturing) have enabled natural gas and oil companies to increase production levels.  But since natural resources are finite, the increased productions rates don't automatically increase reserves--and won't extend their production lives.  In other words, production forecasts will proven to be overly optimistic.

Hence, the thesis of a renaissance in US energy production will be short-lived.  Which means our debts and deficits still have to be addressed, because energy production alone will not improve our economy in the long-term, as the cheerleaders insist.  We won't magically grow our economy from increased energy exports--because there isn't as much oil as the pundits have glowingly predicted.

http://shalebubble.org/wp-content/uploads/2013/02/SWS-report-FINAL.pdf

Milk, grocery prices on the rise if Congress ignores farm bill

Speaking of higher prices...expect higher milk prices if the farm bill isn't passed.  Yet, the Fed insists inflation is benign.

http://www.cbsnews.com/8301-250_162-57560791/milk-grocery-prices-on-the-rise-if-congress-ignores-farm-bill/?pageNum=2

Accumulation

The only sector in the equities market showing accumulation is the precious metals mining sector (the GDX ETF is a good proxy). Check the share volume numbers over the last five years.

Whether you believe we started a new bull market since March 2009, or we are in the midst of a rebound within a secular bear market, the volume has to mirror the price action to be confirmatory. Other sectors are showing declining volume, despite higher prices, which is non-confirming. Liquidity injections (like the most recent $1 trillion Euro bailout) may prop up equities, but the foundation could be built on tooth picks.

See disclaimers on side bar.

Disclosure: long precious metals mining shares, long some biotechs, and natural gas pipeline companies.

A quick primer on inflation

According to monetary theorists, inflation or deflation is created through the easing or tightening of our money supply, respectively. The Federal Reserve Bank controls our money supply, so its monetary policies ultimately determine the rate of inflation.

Here is the St. Louis Federal Reserve Bank's chart on monetary velocity:

http://research.stlouisfed.org/publications/mt/page12.pdf

The empirical formula is m x v = p x q, where
m = money supply
v = velocity of money
p = price level
q = level of economic activity

Looking at the two charts above, we can see money supply growth has been astronomical since 2008, while monetary velocity has remained moribund. The financial crisis has depressed economic activity due to lack of money velocity, i.e. banks aren't lending as they recapitalize their broken balance sheets. Velocity of money is the only fuse to stoke the fire of inflation. And when it does, look out. The other components are already in place for soaring prices.

Is the biotech sector cheap?

According to Dr. Steve Sjuggerud, biotech stocks are currently cheap, based on the price/sales ratio. At the tech boom peak, the P/S ratio was over 20. Today, due to last year's massive market decline and subsequent difficult financing environment, the P/S ratio lies at 3, near it's bottom during the late 1990's.

The media and public have also become enamored with green technology and the massive government boondoggle of tax-and-spend. My personal opinion is that clean technologies like solar and wind power won't gain meaningful traction for years, if not decades, and will only exist as long as government subsidies support their money-losing business models.

Biotechs have also participated in the huge rally since March 6, up over 30%. My cohorts and I have profited immensely as a result, a product of due diligence, prescient market timing, and frankly, instincts and luck. Fear ruled the market in early March, and it just smelled overdone. The due diligence on pivotal events catalyzed the outsized gains.

To summarize, Dr. Sjuggerud likes biotech for the following reasons: they're cheap, unloved, and in an uptrend. I'm just glad my buddies and I picked up on this trend a few months ago.

The Girl Scout Inflation Indicator

Girl Scouts are known for telling the truth, so we'll believe them when they say the cost or producing cookies increased 30% last year. That's why they're keeping the price of a box of cookies the same, but they're including fewer cookies:

Girl Scout Cookie prices

It seems the Girl Scouts are a little more honest about the rising cost of goods than the US Government is with its incessantly under-reported Consumer Price Index (CPI) figures.