Rafi Farber The Forex Markets Are Beginning to Break Down

➡ The article discusses various economic and political issues, including potential war, political upheavals in Europe, and the declining health of President Biden. It also mentions the increasing instability in currency markets, with bank reserves dropping and repo volume rising. The article highlights the performance of Fortuna Mining, a company that is successfully mining gold in Africa. Lastly, it discusses the economic contraction in the central United States, the decline in pending home sales, and the sustained demand for silver in China.

The question isn’t will they, the question is when they do, how long will it last? Well hello there my friends, Rafi here from the end game investor this week’s silver report where arcade economics and things are starting to break down in the currency markets. We’re getting closer to war, well kind of war exactly, nobody knows, but we’re definitely getting closer to war and looks like Biden isn’t doing too well after the amazing presidential debate and who knows if he’s going to be replaced or who is he going to be replaced with? All kinds of political upheavals in Europe and meanwhile the medals are calm but bank reserves are dropping, repo volume is increasing, we have hit 60% of bank reserves taken up by repos, remember the apocalypse happened at about 87% so it could be weeks, probably months away from that point being hit, bank reserves hit a new low for the year and Shanghai silver premiums remain above 10% for the longest period ever recorded which isn’t that long of a period but it’s still the longest period ever recorded.

In a word, the world is not calming down, it is getting more frenetic and by the way this silver report is brought to you by Fortuna Mining, symbol FSM they got rid of the silver in the title but not the S in the symbol so we’re still at FSM. Fortuna latest news intersects 31.3 grams of gold per ton over 12 meters from the Karakara prospect at the Diambasud gold project in Senegal so this is one in development and it’s good to see that they have a very viable mind and development here as they continue with their projects at Seguella which is now in full production.

Here we have Paul Wieden senior vice president of the exploration of Fortuna commented drilling at Karakara continues to improve our understanding of the prospect’s potential returning several high grade intercepts including a highlight intersection of 31.3 grams per ton gold over an estimated true width of 12 meters. If you go down here on the Presley’s you can see the highlights we have even here an 87 gram per ton over an estimated true width of 1.6 meters from 34 meters Karakara is full of gold it seems we’ll see where this goes on the next phase of production as they complete the drill hole program and as the west continues to break down politically, culturally, etc.

I find it a breath of fresh air that Fortuna is now concentrating in Africa where none of this cultural rot appears to be taking place at least not directly but that’s a side point. Let’s continue with this week’s silver report brought to you by Fortuna Mining, symbol FSM. Well we got a lot to get into today so let’s start with something I haven’t really reported on ever on the silver report but you always need something new and that is the Chicago PMI purchasing managers index this is a proxy for economic growth in the Chicago area and central North America and central United States right central United States we have here the Chicago PMI going back to 1968 and the red line is where I put the current read of what is it 35 or something like that or something really anything below 50 is contraction so two things you can notice about this chart is that we’ve been below 50 for the most amount of months in a row excluding this one month I think that was like a few months ago maybe in April or May or something but excluding this I think we’re 21 months in a row in contraction and that is the longest contraction ever in the history of this index here is the lockdowns you had a reading of what was it 29 I can’t really tell the numbers here but the only times when we have lower than we are now meaning more in contraction than we are now was during the lockdowns when moving around was illegal and doing anything was illegal because we were saving the planet and thank god it worked and there were no negative side effects to lockdowns and everything was perfect and okay we also have the 2008 great financial crisis we had lower reads than we have now for about four or five months in that period and the time before that was 1981 1982 and that double dip recession around one goal was at going to record highs and silver hit 50 for the first time so this is a pretty extraordinary number it means that the economy the industrial economy is really crashing in the central region of the united states or midwest is what they call it whatever chicago is technically called who cares and it’s clear signs that the next and final official recession is gaining steam it’s been gaining steam for a while when will it be in full bloom i can’t tell you that but i can tell you the signs are all building up it’s going to be a big one and it’s going to lead to the last monetary printing round i think ever but we’ll see if i’m right pending home sales why am i going to this because we’re at a new all-time low and pending home sales pending home sales all-time low means banks are stuck with mortgages at the point i want to make here so circled here you have the housing crash of 2008 that has been pending home sales hit a low of about 80 000 i think that number is the last one was 70.8 which is actually for the first time since the lockdown is lower than the lockdown low in 2020 of whatever that number was we’re lower now so we’re building fewer houses now than we were when it was illegal to do anything that tells you something about the housing market nobody’s selling homes in a pending manner uh why does that tell you about prices well why aren’t prices falling if pending home sales are as low as they ever been um because people have these low rate mortgages that they locked in at low interest rates and they don’t want to get rid of them because the interest rates are going up and if they were to buy a new house they would have to refinance the higher interest rates so they’re just holding onto the interest rates and who is uh getting hurt because of that well it’s the banks that own the mortgages which means you’re going to have some banking trouble at some point probably very soon we’ve been below the housing crash numbers um pretty consistently since 2023 now i don’t know how much longer this can last but it can’t be forever people i know that for sure shanghai silver premiums we’ll talk about silver for a second so i zoomed in here for the first time gold charts are us is making it available so i can zoom in on 2024 i don’t know why that hasn’t been available until now but now that i can see it i can show you uh that we’ve been above the 10 premium line the black line is what i drew in here 10 premium shanghai over new york um pretty much the entire year excluding like a few weeks maybe two or three weeks it looks like two weeks between march and april we’ve been above 10 and we’ve been above 8.5 basically the entire year and if you zoom out uh you can see that this has never really happened before with the only times we’ve been above 10 percent very very briefly for like a few days during these periods and a slightly longer period maybe a week or so maybe two weeks uh in late 2014 as silver was finding its final lows uh this is something else though this is sustained chinese demand from shanghai exactly what is fueling it i can’t tell you um i’m hoping it’s silver stacking but it’s probably a combination of different things since this these premiums are being sustained it means that there is a sustained change in the silver market as chinese people are relating to silver in a different way now um i wanted to comment on this zero hedge tweet mostly i agree with it but there’s one point that i want to correct here in the zero hedge tweet so the yen we’re gonna talk about the yen now the yen as we know broke through 161 this morning uh new low we’ll get into that in a second so yen weaker than lira and peso in 2024 so this is the performance of different currencies than different international currencies versus the dollar year to date 2024 the worst performing one is the yen it is worse the argentine peso which is a country in hyperinflation uh it looks like mille javier i mean they might have mitigated that a bit with his libertarian policies we’ll see if it follows through uh still the turkish lira has been hanging around where it’s been where’s the dollar for 2024 but that country’s uh has been in a jogging hyperinflation for years i think two or three years now and the japanese yen is doing worse than them uh so then the tweet says and the latter part of the tweet the best part is once you finally contain it it’s talking about the bank of japan to the yen once you finally contain the currency crisis in the end you have a bottom market crash to look forward to i slightly disagree with that assessment and this is the next chart here so it says yen weakness directly correlated with japanese bond weakness we can see here and i’ve gone through this a few times i just want to hear how it’s so important and so few people understand this that the weaker the bond market is the weaker the yen is i’ve said it before and i’ll say it again how this contradicts what what zero hedge is saying in its tweet is once you contain the currency crisis then you have a bond market crisis but no once you have a bond market crisis you also have a currency crisis they happen at the same time because the yen is the bond market because the bank of japan owns so many bonds that’s what the yen is so as the bond market unravels so does the currency there is no way to strengthen the yen at this point if you hike rates if the bank of japan hikes rates let’s say four or five percent to get rid of the spread between the dollar and the yen then the yen collapses anyway because the bonds on its balance sheet collapse in value and so does the purchasing power of the yen here is the chart of the yen and i want to show you the technical situation we’re in now this is quite interesting so i think the the latest numbers on this is not 160.94 i think it’s 161.1 or something like that but we broke through 161 this is above the 1990 low here remember the higher this is the lower the yen is is the amount of yen it takes to buy a dollar uh the final support here that is that might not even be a support because it’s so uh it’s so blippy it’s very very um tenuous over here is 163.29 in october 1986 so 160.29 we had one blip and then after that we pretty much have no support until we hit this line over here this dash line of 189.45 so the 163 i’m getting from this number over here where i masked over it and i froze the screen so you have 163 and then 189.45 there’s basically nothing between 163.3 and 189.45 so once you bake through 163 which could be in the next few days it could be imminently um we could head towards 189.45 and none of this uh precludes that the bank of japan won’t intervene here they still have cash to intervene the question isn’t will they the question is when they do how long will it last a few days a few weeks a month who knows uh and what number are they waiting for i have 100 might be 163.3 here the final support zone when they might smash it and then get the yen back into the 150 somewhere and then we can uh maybe a few weeks maybe a month later you can start heading towards 189.5 we’ll see what happens how is this affecting the japanese uh consumer prices you can’t see the the bar on this chart here but i put the line where the latest read is this is month over month consumer prices i don’t like calling inflation because it’s just the effect of inflation so it’s i said here japan consumer prices advanced 0.5 second highest reading post covid era so 0.5 there’s only one two three times um we’ve hit that number since i think this is 2008 maybe 2007 uh and if you want to go back one two three four times since the asian financial crisis somewhere in there um this is a very very high read this is uh close to record territory here um and we very rarely get through this only once since the covid era um and uh if the yen keeps falling which i think it will we will head toward higher higher in japanese consumer prices which will uh force the boj the bank of japan to hike rates on its bonds which will crash the bond market which will make the end even weaker there’s no way out here it just there just isn’t um this final chart um this is the percentage of bank reserves taken up by repos um we are up to about 60 we were at 50 5 56 last week we’ve jumped 4 to 60 and the apocalypse the major financial crisis of 2019 happened around here at 85 when repos took about 85 of bank reserves bank reserves fell to 33.26 trillion i believe and uh they’re going to keep falling as quantitative tightening continues and uh really there you have it folks the yen is crumbling silver premiums remain high the price has calmed down the golden silver haven’t moved much in the last two three weeks uh but we’re getting ready for the next leg up exactly when i can’t tell you but it’s gonna happen but the real leg up won’t happen until after the final financial crisis which we are getting closer and closer to i am watching the percentage of bank reserves taken up by repos that will tell me when we have run out of dollars in the sewage system in the monetary sewage system and then we should begin the final round of printing if you enjoyed this silver report then please sign up to the endgame investor on sub stack and if you want extra curricular stuff become my patreon patreon for as little as three dollars a month to get spiritual lessons in the monetary field this is rafi the endgame investor with this week’s silver report for arcade economics and i’ll see you guys next week well thank you rafi as always for this week’s silver report and thank you to everyone who has been out there watching joining us for all the shows we’ve had this week hope you’ve had a great week out there and like to make a special note to one of our friends in the audience who is part of an event this weekend to raise money for pediatric cancer care which actually remains the leading cause of death by disease among children in america and our dear friend collin guj a long time arcadia watcher and friend of the show is part of the event this weekend where they’re going to be playing golf for 24 straight hours to raise money for pediatric cancer research and just wanted to wish collin congratulations as he gets ready to play for 24 hours and also let people know what he’s doing and he sent over a short video of what they’ll actually be up to this weekend and we’ll play a bit of that right now so we are team you cannot judge a team by its height and uh my name is mike this is chayton and matt we’ll be out here for 24 hours 24 24 hours it’s just a little give back from all the players here to the kids that that battle like chayton and fight so hard it’s a long day but it’s worth the go fight there’s so many kids that need our help and this is just one way that we can raise money for cancer kids and the research that’s so desperately needed there are people out there and families out there that deal with the unimaginable every single day this group knows to not take that for granted and so every little thing we can do to help out we’re willing to do this is personal for me as my nephew had pediatric brain tumors when he was five so this is a very special event for me and the more we can do to raise awareness with kilts and skirts but also raise money and just let them know that we care and that we’re here to support them so again congratulations to colin if you would like to find out more or consider supporting their efforts as they’re out there for 24 hours this saturday the link to that is in the description field below thanks to colin for being out there doing good things in the world hope you’re all getting set for a great weekend appreciate you and we will see you again next week
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