The Government’s Plan To Steal Your Money
The Government’s Plan To
Steal Your Money
The
Deep State’s Attempt To Suppress India’s Gold Demand
November
29, 2016Financial Markets, Gold, Market Manipulation, Precious MetalsDeep
State, Modi, war on cash
The
primary objective of the Indian currency demonetization was to sharply reduce
gold demand in the world’s most important retail market, India, one that is controlled
by the Deep State oligarchy via a captured agent, its Prime Minister [Modi].
The manner in which the demonetization was carried out indicates some kind of
desperation…Stewart Daugherty
Indian
Demonetization Denotes Severe Stress in the Global Gold Market
By
Stewart Dougherty
It
is becoming clear that the Indian currency demonetization is actually a planned
attack on Indian gold demand, launched to disrupt gold prices and discredit
gold as an asset class. The attack was required to alleviate severe stress in
the global gold market that is becoming increasingly difficult for the Deep
State controllers to contain.
For
two decades, physical gold has been migrating from the west to the east in
increasing quantities. Numerous reports cross-confirm that the world’s leading
refineries are operating at capacity to convert western gold into the kilo
products demanded by Asian buyers. Refiners also confirm that the sourcing of
western gold has become problematic, as supplies dry up in the face of voracious
world, and particularly eastern demand.
Western
central bankers and their Deep State handlers have made it clear that they
intend to transition to a cashless society. However, they are not yet ready to
make this transition. Therefore, their current focus is to start the process by
eliminating high-denomination currency, such as Euro 500 and USD 50 and 100
notes. At the same time, they are working to digitize the payment
infrastructure, a prerequisite to the elimination of cash.
Their
problem is the steady awakening of the people to the disturbing implications of
a cashless society, and to the assault on human liberty it represents. The Deep
State oligarchs must implement their agenda before the people mobilize to
prevent it from being imposed upon them.
The
Deep State oligarchs understand that the western governments they commandeer
are bankrupt. To continue operations, they must tap into the people’s private
wealth for funding. In fact, the IMF has produced a position paper recommending
a “one off capital levy of 10%” (a 10% wealth tax), to deal with western
governments’ intractable fiscal problems. The authors of this paper state that
the “levy” must be imposed at night and by total surprise, to prevent citizens
from being able to take any steps to avoid it.
This
type of ambush is exactly what just happened in India, with its shock
demonetization.
The
IMF’s proposal does nothing to change governments’ current trajectory of
greater deficits and debt; the money raised would simply be used to service
existing debt. This means the first capital levy will just be one of many going
forward. Governments’ only solution is to expropriate the private wealth of the
people, which is exactly what the IMF has admitted.
If
people have cash and other private monetary assets outside of the banking
system when the “capital levy” is imposed, governments will lose out. This is
one of their primary motivations to eliminate cash: in order to maximize
proceeds from the capital levy, they need the greatest possible amount of money
within the banking system, in non-withdrawable, digitized form, when the levy
is executed.
It
is not in the interests of governments if people figure out that they are far
better off being their own bankers, by privatizing their monetary assets, than
handing them over to commercial bankers, who have become wards and enforcement
agents of the state. Therefore, a full scale campaign is underway to demonize
cash and to make precious metals appear dangerous by routinely pulverizing
their prices.
In
the meantime, supplies of physical metals in the west constantly diminished and
are now strained. This means that the bullion banks’ LBMA and Comex paper price
suppression activities must steadily escalate for them to maintain control of a
market that is spinning out of their control. Unlike eastern investors, western
investors tend to buy into rising prices, as they chase momentum. Rising prices
can lead to a buying stampede. If a buying stampede were to break out in
today’s supply-stressed precious metals market, prices would surge, which would
be antithetical to the Deep State oligarchs’ agenda.
Given
that Deep State operatives can do nothing to increase western gold supply,
their only options are to somehow discover supply elsewhere, and/or to crush
gold demand.
The
“somehow” is India, a nation whose people possess an estimated 20,000 tons of
gold, and who buy hundreds more tons of it each year. Prime Minister Modi, the
Deep State establishment’s captured and controlled facilitator, has been
instructed to obtain supply and control demand of gold in India, and he has
been working overtime to achieve both objectives ever since his election.
First,
Modi launched a Paper Gold scheme, whereby the Indian people were urged to
tender their personal gold holdings to the state, in exchange for “notes” and
“bonds” paying less-than-inflation interest rates on the value of the gold they
provided. The notes are irredeemable for gold for at least five years, by which
time the gold will be long gone from India and used in the bullion banks’
market rigging and other for-profit operations. Modi’s Paper Gold scheme
failed, because the Indian people did not trust it, and correctly so.
Next,
Modi imposed a 10% import duty on gold (India produces next to no gold, so
virtually all of it is imported). This resulted in a multi-week strike by
jewelers, which did reduce demand, one of the two aims of the Deep State
oligarchs’ plan.
But
shortly, this scheme failed, too, because gold smuggling surged, enabling the
Indian people to obtain the gold they desire at prices roughly 5% over global
spot, reasonable in the circumstances.
In
a companion effort to crimp demand, Modi enacted a special reporting
regulation. Enacted in 2015, it requires anyone purchasing jewelry or precious
metals having a value of 200,000 rupees or more (the equivalent of roughly US$
2,900) to present an Indian PAN Card. PAN stands for Permanent Account Number,
a ten digit alpha-numeric number issued by India’s Tax Department to
individuals and businesses. The PAN enables tax personnel to track all of a
card holder’s financial transactions over their entire lifetime.
Only
17% of India’s population have obtained a PAN number to date, meaning that 83%
of the population are unable to purchase $2,900 or more worth of jewelry or
bullion in a single transaction; without a PAN Card, it is illegal to do so.
This regulation has reduced jewelry and bullion purchases by upscale Indians
who do have PAN but do not want their personal transactions permanently
recorded. Alternatively, it has led them to make smaller purchases that do not
require presentation of a PAN Card.
While
the PAN regulation curbed demand in the $3,000+, high end of the market, it did
nothing to address the vibrant, lower end, cash market. Smaller purchases of
jewelry and bullion have traditionally been paid in cash, using 500 and 1,000
rupee currency notes. This was the Deep State’s Achilles’ heel in India, and
they decided to deal with it.
Accordingly,
on November 8, 2016, in a shock move, Modi “extinguished” all Indian 500 and
1000 rupee notes. Holders of the old notes have been required to exchange them
for new ones, but the process has been extremely difficult and time consuming.
Further, there are sharp restrictions on the amount of new currency citizens
can obtain. Withdrawals are capped at 40,000 rupees per week, roughly $575.00.
After paying for living expenses (90% of Indian purchases are made with cash),
very little is left over for discretionary purchases such as gold jewelry.
Given that the demonetization was specifically timed to occur in the middle of
the robust festival and wedding season, the reduction in demand has been
pronounced. Jewelers in Mumbai, the nation’s largest retail market by far,
report sales being off by up to 90%.
We
believe that the primary objective of the Indian currency demonetization was to
sharply reduce gold demand in the world’s most important retail market, India,
one that is controlled by the Deep State oligarchy via a captured agent, its
Prime Minister. The manner in which the demonetization was carried out
indicates some kind of desperation, because it defied all economic prudence,
logic, humanitarian regard and common sense. India is the only country where
this kind of attack on demand could have been carried out, and this is why it
occurred there. It indicates to us that the bullion banking cabal is coming up
against the wall, and that there is severe supply – demand stress in the global
gold market that is rapidly becoming non-containable. Desperate times are
producing desperate measures by the manipulators.
It
is critical to note that the Governor of the Reserve Bank of India up until
mid-2016, Raghuram Rajan, declined a second three year term. Rajan was a former
Chief Economist at the International Monetary Fund, the “capital levy” people.
He is also a member of the Group of Thirty, along with Larry Summers, the head
cheerleader for the elimination of one hundred dollar bills in the United
States, and cash in general. Much more important, Rajan has now become Vice
Chairman of the Bank for International Settlements, the so-called “central bank
of central banks,” and long regarded as the chief architect and enabler of
global gold manipulation and price oppression. He has been characterized in the
press as being “a vocal votary for increased coordination among central banks.”
Clearly, an important Deep State global agenda is now in play.
Brexit
and the Trump victory have demonstrated that the people can only be pushed so
far, but the Deep State oligarchs are far too addicted to easy money and
god-like power to hear the message. They are pushing forward as if nothing
whatsoever has changed in the world. The retention by the people of financial
liberty is far more important to them than Brexit or Trump, and we believe they
will defend their rights to it, particularly as they awaken to the full
implications of the tyranny that will be unleashed by its elimination.
As
demand rebuilds from the shock demand reduction that has occurred in India, we
believe the market for precious metals will become stronger than ever. First,
India has discredited governments’ prized monopoly product: fiat currency.
Second, India’s demonetization-related gold demand shock has no effect
whatsoever on demand from Russia, China and the rest of Asia, which is stronger
than ever. Third, the fiscal and monetary realities of governments throughout
the west continue to worsen, strengthening the already compelling case for
precious metals. Fourth, and as we have pointed out in previous articles,
supply cannot withstand even a fractional redeployment of liquid personal
assets into metals, without prices being forced significantly higher than where
they are today. And fifth, the bullion banks and Deep State schemers are
running out of curve balls to throw at the people. In fact, the stunt they just
pulled in India might be their last, at least of anywhere near this magnitude.
While we put nothing past them, including desperate dumping of remaining
western central bank metals holdings (which might not even exist at this late
stage) and prohibitions that the people will realize they must ignore if they are
to have any chance of remaining financially free, it seems clear to us that
they are fast running out of options.
Stewart
Dougherty
November
28, 2016
P.S.
One additional inference we draw from events in India is that it almost
certainly proves the United States gold reserve is gone. What has happened in
India indicates that a critical supply – demand imbalance exists in gold, which
required an unprecedented, draconian and reckless “solution.” Actually, it has
solved nothing; it has only bought the oligarchs some time, and probably not
much of it. If western, and particularly U.S. gold reserves had been available,
they almost certainly would have been deployed before a massive, destructive
currency demonetization in the world’s second largest nation, by population,
would have been ordered.
Stewart
Dougherty is the creator of Inferential Analytics (IA), a forecasting method
that applies to events proprietary, time-tested principles of human instinct,
desire and action. In his view, forecasting methods not fundamentally based
upon principles of human action are unlikely to be reliable over time. He is a
graduate of Tufts University (BA) and Harvard Business School (MBA), is a 35+
year veteran of the business trenches and has developed IA over a period of 15+
years.