Power?

It appears to me that just today the EU and the rest of the world just found out how serious Mr. Putin was about only taking Rubles, gold or bitcoin for payment from countries that are hostile to Russia.

Earlier in the week the G7 (those who think they can create “wealth” by conjuring up digits on a screen) let Mr. Putin know that they would not be paying in Rubles. Today, he decided that the shipments of goods would be stopping to anyone not agreeing to his terms. In addition, he gave orders to start looking into pricing other exports in Rubles. I believe this could get VERY ugly for the US dollar VERY shortly.

For all of those that thought Russia was cornered and might cave in, it appears that those who produce hard assets needed for human survival have more leverage than those that think they call the shots because they can conjure up hundreds of trillions of dollars, yen, euros, etc.

Do you think that holding hard assets like gold, silver, food, water, energy and the companies that produce them might give you a little more leverage than paper promises?

Many people say “you can’t eat gold”. Try eating a computer blip or a green piece of paper. Try heating your home with an entry on your computer. Try driving your car with gas at $50.00 per gallon.

“Printing” money, as I have written for over a decade, produces NOTHING BUT the illusion of wealth and the illusion of power. The illusion is now being exposed by an actor who realizes that the world will suffer far more than his country because they are producing real goods and our largest export is conjured up cash from nowhere.  This is evidenced by our trillion-dollar trade deficits.

Yesterday, prior to Russia’s announcement today, Germany already entered phase 1 of 3 for an energy emergency-(Rationing). This is the same country that shut down its nuclear plants to go green. How is that working out?

Those “in charge” in Europe and the USA seem hell-bent on escalating a situation where almost everyone would lose. They put on sanctions and trade restrictions and it leads to all-time high inflation and rising prices. Those who can afford it the least suffer the most.

Of course, this gives the money “printers” cover for the massive inflation that they actually caused with the 40% increase in money supply in the past 18 months or so. Inflation is actually always caused by too much money being created.

They have the mainstream (I call the Lamestream) media trying to whip up negative sentiment about Putin so they can, it appears, drag us into a war that nobody will win if it gets fought. In the meantime, there is no mention that the USA helped overthrow the elected government and installed the puppet that is now portrayed as a hero. Just a few short years ago Ukraine was universally know as a corrupt cesspool with Zelinski at the head.

Maybe there is no mention of that because of the involvement of many members of our government- right up to the top.

I am not for Russia, I am not for Ukraine. I am not for war, in particular. Turn off the boob tube, do your own research and decide what you believe. One thing that I don’t believe can be argued is that this current trajectory is, at best, going to cause the USA and the world great economic pain in the higher prices we will pay and at worst could be the end of life as we know it.

It won’t matter whether you are a republican or a democrat, gay or straight, white, black or something else if we get hit with an EMP or heaven forbid start a nuclear war. NOBODY wins.

It is unfortunate that those “in charge” have no problems causing pain to those that they are SUPPOSED to represent. Unfortunately, they really represent the military-industrial complex, the drug companies, the major banks and the central banks- at our expense and for their enrichment.

At the end of the day, as Gerald Celente says, “When all else fails they take you to war”.

It is obvious to me that the financial system has broken down. Trillions are being conjured up to keep the masses as clueless as possible. Now, however, the inflation that is raging is making it impossible to hide the rot that has taken over our financial system.

Many are pointing to the 1970s when the last large inflation event took place. What most should realize is that inflation was calculated different then and is actually higher now. The only way to tame inflation is to make interest rates higher than the inflation. In 1980 you could get an 18% money market and a 12%  5- year CD. We were able to raise rates like that because we were not drowning in debt as we are today. It is likely that a return to a normal 5% interest rate would collapse the economy. My take- get ready for FAR higher prices regardless of the outcome in Ukraine.

Covid was blamed for a massive downturn. Why did the Fed hand out $9 Trillion from September 2019 to March 2020? Something must have been up prior to that but because of the media’s constant propaganda 99% (if not more) of all people blame COVID.

I am sure the lockdowns added to the misery but there was obviously a problem LONG before the virus.

Right now, we may be seeing the end of our current system playing out in real time. I am looking specifically at Japan. They have led the world in print and buy schemes for decades. In those decades it seemed that no matter how many yen were conjured up there was no inflation. I believe the biggest reason for this was their massive trade SURPLUS. How many yen were conjured up? I don’t know the exact number but their national debt is listed at over a QUADRILLION Yen. That is over 1000 TRILLIONS.

Today, however, the Japanese are getting a lesson about what happens when your currency is weakening substantially and you import almost all of your raw goods. A weak yen could be the end of the unlimited power to “print and buy”. This would likely lead to FAR higher interest rates and collapsing of the economy and markets. I have written about the Fed likely facing this same scenario at some point.

Many will say “it can’t happen they can print money”. While that is true you and I could print money too and if nobody placed any value on it you could offer trillions and get 3 eggs like in Zimbabwe or Venezuela.

While the world is hurtling towards massive inflation and the UN and major countries are warning of food shortages and lack of resources it appears that the pain at the pump and at the grocery store may be just beginning.

I believe the only way to hedge these risks is to participate in the commodity markets and buy hard assets and the companies that produce them. I believe that the days are gone when, if you didn’t lose any “money”, you were safe. The way currencies are being debased staying flat IS losing.

Be Prepared!

Any opinions are those of Mike Savage and not necessarily of those of RJFS or Raymond James. Expressions of opinion are as of this date and are subject to change without notice. The information in this report does not purport to be a complete description of securities, markets or developments referred to in this material. The information has been obtained from sources deemed to be reliable but we do not guarantee that the foregoing material is accurate or complete. Any information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct.

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