...the worst legislative crime of the ages is perpetrated by this banking and currency bill…. From now on, depressions will be scientifically created  –regarding the Federal Reserve Act creating the US Central Bank –Charles A Lindbergh, Sr.

As the 2024 election euphoria continues, the financial world once again bathes in the fleeting warmth of an expanding stock market, reaching new heights with a mix of trepidation and exhilaration. Yet, beneath the surface lurks a potent undercurrent: the gravitational pull of a colossal and accelerating national debt, now standing at a staggering $35.95 trillion.

For many, the election signals a new start and a chance to correct all wrongs. But in the interest of veritas, the markets are worse today than before the election, and the prognosis was not hopeful, no matter who assumed the role of commander-in-chief. The real controllers already have set the course of the economy. We are obligated only to use the truth to expose the perils that lie ahead.

The analyst’s eye, filtered through the lens of Austrian economics, sees the precious metals market responding consistently with eras of fiscal unease—gold recently nearing stratospheric levels of $2,780 an ounce and silver shining brightly above $34.50. These metal movements are a silent siren, signaling more profound anxieties that unsettle the foundation of our debt-laden financial system.

This week, we measured the market’s pulse amid rising copper prices, which often augur scintillating prospects for silver—its industrial counterpart. The kinship between these metals is more than superficial; it reflects surging inflationary pressures and apparent hedging from investors wary of fiat’s turbulent future.

Moreover, a disquieting symmetry emerges as we consider the delicate balancing act between soaring metal prices and the resurgent energy sector, characterized by the slight downturn in Nymex crude oil futures hovering around $67.00. These commodities, sensitive to market speculation and pragmatic demand, serve as precursors for the future economic trajectory.

In the short term, the likelihood that precious metals will continue their ascent remains high, as political uncertainty surrounding U.S. elections tends to bolster the allure of safe-haven assets. The specter of continued quantitative easing looms as nothing short of monetary heresy, introducing discordant notes into the market’s symphony.

Today’s announcement by the Fed that we can expect another rate cut just after the previous large rate cut is just another bandage on a wound that will not be healed by fueling inflation. The rate cuts worsen inflation while fueling the rise of an irrational stock market –enriching the 1% while bringing closer the day the sky falls and the market reconciles with reality.

Looking past the immediate, those with a discerning eye on the intersection of economics and politics question the sustainability of recent market exuberance. Barring structural reforms that address the ticking time bomb of national debt, the folly of entrenched fiscal irresponsibility will ultimately lead to a renaissance of pain across market segments.

The commodities space, a closely watched theater of global economic indicators, also projects an unsettling picture. From oil markets bracing for supply adjustments to grain and soybean prices navigating the choppy waters of interest rate impacts, commodities are indicators of the broader systemic health—or ailment—afflicting the world’s economic order.

Debt markets reveal an ominous picture, with investment-grade firms conspicuously active post-Fed announcements. Thus, increased participation in short-term debt markets among BBB and BB-rated firms is a testament to the distortion wrought by central bank interventionism—corporate debt appetite skewed by artificially low interest rates.

The post-election spike in the 10-year yield does not indicate that markets are freely trading. Rising stock prices into a wildly increasing bond yield betray a disconnect between economic realities and the digital screen of a theatre of programmed responses.

On the other hand, the forecast of long-term rising asset prices and rock-bottom rates paints a concerning picture: we may experience escalating inflation, compounded by a need for central banks to tighten their reins. Such a scenario would likely trigger volatility across equity and commodity markets, potentially inducing sharp corrections.

To safeguard against these impending perils, solutions rooted in Austrian economics advocate for adopting competitive currencies, the disentanglement from overwhelming public debt, and a return to sound monetary policies. Yet, the question posited to policymakers, investors, and the citizenry alike is whether the lure of short-term market gains will close our eyes to the indispensable curative measures.

As we stand on the precipice of what may become the most significant monetary realignment in recent history, precious metals do not just reflect market trends; they serve as a critical diagnostic tool, a vanguard in the clarion call for a profound reevaluation of the foundations of our financial realities.

The crux of the situation is whether the U.S. and like-minded Western powers will recognize the warning signs offered by these guardian assets. Will it take the precipitous fraying of the fiat currency fabric to awaken a belated drive for genuine economic reform?

Investors, households, and governments must heed the lessons articulated by Rand, Mises, and Rothbard: freedom and prosperity flourish under conditions of fiscal responsibility and limited state intervention. Adherence to these principles will depend on our collective capacity to navigate the treacherous waters ahead.

Be not deceived – be prepared ~ Silver Savior

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• Note: We are not giving advice; we only give our opinion; we are not financial advisors. This article only represents our thoughts about the economy.