Gold & Seasons?
QUESTION: Martin,
In your June 23rd post, you stated: “The [June] bounce is really seasonal, yet it is being explained as everything but.”
What Does this mean? There is a season to gold?
ANSWER: Yes. May/June often produces the low in gold. That is what we were saying a June low with a bounce. The other key months tend to be January/February. So the “bounce” from a June low on June 2nd is rather common.
Sunni-Shiite Civil War
QUESTION: Marty; Your model correctly forecast the birth of the Arab Spring in 2010 that was 31.4 years from the Shiite Revolution in Iran back in 1979. You also said that the subsequent 8.6 to 13 years would bring rising civil unrest that would emerge into civil war when the War Cycle turned up in 2014. This seems to be taking place in Iraq right now. So where do we go from here?
Thanks in advance
GK
ANSWER: We are preparing an update on that model. Most people have no idea in the West what a Sunni-Shiite conflict is all about and that this has been a cyclical trend between peace and war since Muhammad died in 632. The Iranian Revolution took place in 1979 and 31.4 years later we had the Arab Spring that began 2010.964. It surprised many because they expect revolution only when there is some defeat at war, a financial crisis, peasant rebellion, or disgruntled military. In the case of Iran, the revolution occurred in a nation that was enjoying relatively good material wealth and prosperity, although there was resentment against foreign investment that became America in the eyes of the Great Satin. What the traditional pundits missed was the cycle in religion and the historical battle between Sunni and Shiites. Once again, they fail to understand what is going on and how many Sunni in some respects consider the Shiites not to be even followers of Islam. (OUR WORK IN THIS AREA WAS CAREFULLY REVIEWED BY BOTH SUNNI AND SHIITE AUTHORITIES FOR ACCURACY AND IS NOT OPINION NOR DO WE TAKE ONE SIDE V THE OTHER)
The Iranian Revolution came 8.6 years after the collapse of Bretton Woods that then sparked the decline in the dollar and the first OPEC oil price shock in 1973. That was the start of the 10th wave of 51.6 years from the birth of the first Islamic State in 622.
From there, we should see more violence and a religious revolution in the region once again 8.6 years from 2010 taking us into 2018. The full cycle will be into 2021. That should turn up starting 2014. So far everything seems to be on target. When the economy turns down in 2016, the intensity should rise around the globe. There is a 309.6 year cycle in religion that has been extraordinarily regular and that includes ALL religions not just Islam. This is of course amplified by economic downturns.
Civil Unrest Rising Everywhere – Including the UK
The greatest problem we have is misinformation. People simply do not comprehend why and how the economic policies of the post-war era are imploding. This whole agenda of socialism has sold a Utopian idea that the State is there for the people yet it is run by lawyers following their own self-interest. The pensions created for those in government drive the cost of government up exponentially with time. The political forces blame the rich and this merely creates a class warfare with no resolution for the future. Even confiscating all the wealth of the so-called rich will not sustain the system. Consequently, we just have to crash and burn and start all over again.
The Guardian reported that some 50,000 people marched in London to protest against austerity. They cried: “Who is really responsible for the mess this country is in? Is it the Polish fruit pickers or the Nigerian nurses? Or is it the bankers who plunged it into economic disaster – or the tax avoiders? It is selective anger.”
The exploitation by the bankers has been really a disaster. They have been their own worst enemy and in the end, they have become the symbol that inspires class warfare if not revolution. They are not the representatives of those who produce jobs. They are merely those who wanted to trade with other people’s money for free. When they win, it is their’s, but any losses are passed to the taxpayers. Bankers should be bankers – not hedge fund managers who keep 100% of the profits using other people’s savings.
The repeal of Glass Steagall was the final straw that broke the back of the world economy. That was the single worst act that could have ever been done and we are now paying the price in spades. The collapse from 2007 has wiped out even the liquidity of the markets. The second worst act was the creation of the euro when the real goal was the federalization of Europe from the outset. That undermined the entire European banking system and has led to a serious undermining of the entire global economy.
The solutions from politics will always be the same – grab more power. We are in a downward spiral of liberty and how far we go down this path to the future will be determined by the people and if they at least wise up and see this is not class warfare, it is the people against government. This is why I say career politicians are dangerous for they can be bought way too easily as Clinton was to open the flood gates for the bankers.
This is not going to end pretty. The question is when does society wake up? Just how high will this price be that we have to pay? They will blame the rich and the idiots will cheer – get them. What will happen when there is no more wealth to hunt? We end up with a communist state by default – no wealth, just career politicians who blame everyone but themselves.
Bull Market in Taxes
You can rent mansions in France now really cheap for anyone who had money seems to have left the country. The Labour Party in Britain is proposing a 2% property tax. There is no property tax in Britain or France. This is already starting to slow the trend in property prices in London itself and once the core starts to flatten-out, the suburbs are not too far behind. Nevertheless, the feeling that things are better in London is clear as we move into the major high for this business cycle come October 2015.
Without doubt, everywhere you look you see taxes on the rise. No government seems prepared to reform or even address the constant rising cost of government. Even someone brain-dead should figure out that the design of government is unsustainable. If you have 10 police and 5 retire, you have to still pay their retirement and then hire 5 more driving the cost of government now to 15 police salaries. This cannot go on forever and all they see is a bottomless pit of wealth to be taxed.
Gold the Rally
The target for the June low seems to have been correct and this week was a Panic Cycle target. We saw the gold closing above 1295 and the first weekly closing above 1307, but the key resistance remains a weekly closing above 1355.
The bounce is really seasonal, yet it is being explained as everything but. The war raging in Iraq is part of that cyclical movement in line with our religious models we will update. We are in the confrontational phase of Islam that began in 1973 with the first OPEC shock and now a civil war between the Sunni and Shiite is emerging more openly. Our original forecasts in the 1987 report appear to be still on target in respect to Islamic trends.
The real bounce in gold is not due to war. That is the typical domestic spin. The real issue is the growing move toward electronic money and the bearishness in Europe with the increasing talk of federalization of Europe. This will be the real long-term issue for the rise and sustainability in gold – not war without serious global risks.
We have daily closing resistance forming at 1330 and 1340. A closing above these levels will signal a further rally. The primary resistance remains 1355 and 1394. We need a monthly closing ABOVE 1352 to signal a further rally ahead.