Montreal Analyst

                                                                          Inflation is here! A few weeks ago, we predicted that a point of inflation was possibly upon us and it was going to be reflected in the bond market. We suggested that the turning point was July 8, 2016. At that time, ten-year U.S. notes were trading at 1.35%, yields on tips were negative, gold was fetching $1,375 (15% more than it did a year ago), and consumer prices were less than 1% higher than the previous year. It appears we might be right. The headline CPI rose 0.3% between August and September, registering a year over year increase of 1.5% while core CPI was up 2.2% and running ahead of the Fed’s target rate of 2.0%.

What about copper? By Harold AGJ Davis,    www.prairiecropcharts.com  Winnipeg, Manitoba As a key industrial commodity, copper prices are very sensitive to pressure changes in economic activity. Thus, any copper market analysis also encompasses an economic insight. What is copper telling us now? Copper’s price responsiveness to economic expansion and contraction over the past half century is well understood. Yet, in the past fifteen years or so, copper’s moves have not corresponded as closely to changes in American industrial production and construction as they once did. It seems that copper’s drivers have evolved and demand swings are no longer dependent upon the service sector dominated American economy. Rather, the capital spending, infrastructure development and booming construction of Asia, China in particular, appear to have taken over.

  At the Montreal Analyst.com and Canadian Mine Analysis.com, we believe that gold and silver mining stocks will be one the best performing groups of this decade. Since many readers  are not familiar with gold mining and silver mining, we thought that we would give a quick capsule summary of the “nuts and bolts” (better yet the picks and shovels)of mining. The basic premise naturally is that the property (project) contains gold. A company wants to determine if gold (or silver) reserves are in the ground. This is done primarily by exploration (such as samples) and eventually by drilling. The samples and drill results are sent to a lab for analysis. That will help estimate the  amount of reserves in the ground. It takes time and is expensive-and it’s only the start.

The price of gold bullion is blatantly being manipulated as we have seen again this week. It was so obvious by what transpired on Tuesday. On our sites in the past, we have said that without manipulation by the central banks colluding with certain brokerage houses gold would likely never have been below $1300 an ounce during the last four years.

HPQ Silicon Resources, (formerly URAGOLD) investors must now wait…

It doesn’t make sense but bull markets do not end due to overvaluation. They generally end with interest rates rising more than moderately, a decline in the money supply or a recession which we don’t yet have. But, we now have short and long term cycles that are issuing strong warnings. Take a look at the past and note the similarities with the market today. Dangerous market tops are usually accompanied by overvaluation. Caution is warranted. Yet, we still find so many stocks that are incredibly undervalued. For example, many gold and silver mining stocks are very cheap.

From August 24 article on “Canadian Mine Analysis” Napoleon Bonaparte once offered this wise advice; “Never interfere with your enemy when he is making a mistake.” Napoleon’s theory was proposing that by letting his enemy make a mistake it offered him a better opportunity to defeat his enemy. In a sense, over the last two years we have seen investors  literally throwing away shares of stocks that were selling at multi-year lows offering us the opportunity to buy those shares while they were extremely undervalued.   Our research has suggested for the past two years that we were making major bottoms in gold and silver mining stocks and it has been an ideal time to accumulate them. We had suggested “dollar cost averaging” and wrote articles that appeared on our sites and in publications such as “The Bull and Bear.” Today we are in the early stages of a bull market for many gold and silver stocks incrementally. Some have already seen enormous percentages while others will see a bull market later on as all mining stocks do not move up at the same time.

The Eurodollar futures chart has given a major signal that the short term interest rate regime of the last eight years is under attack and breaking down right now. Yes, the chart action indicates that we may finally be seeing the market warning of a rise in short term rates. Since 2010, the Eurodollar futures chart has demonstrated price support in the 99.17 to 99.25 zone on three separate occasions. Today, Eurodollar futures prices have violated this support zone and are trading at 99.125. For chartists, this strongly suggests that something profoundly different is happening and that the old paradigm that generated the previous trading range environment has come to an end.

The global debt load surges higher and higher, adding to risks to the global financial system. In the next recession, overextended borrowers (whose numbers are large and growing) may be unable to pay on their loans, and debt defaults could mushroom, leading to general systemic financial distress. The total of all forms of U.S. debt, including government debt, business debt, mortgage debt, and consumer debt, is now more than $59 trillion. The great majority of this debt has accumulated in recent decades–and at an accelerating pace–with the exception of the financial crisis of 2008, when lenders were afraid to lend. This unsustainable growth in debt has blown the greatest debt bubble of all time and has put the economy and financial system at risk.

 By Harold AGJ Davis     19 July 2016  Change unfolds as a slow and cumulative process over extended periods of time until something happens to cause an abrupt shift. Rock formations contain layers of different thickness and colour, often separated by very thin boundaries. What happened from one moment to the next? Human history unfolds in much the same way, except that timespans are shorter and few recognize the periods equivalent of rock layers. Perhaps many are unaware of this cyclicality because it is partially obscured by the cumulative nature of technological progress, and they fail to consider that the route taken was not the only choice, nor was it inevitable. Thus, when a market guru suggests that his favourite holding period is forever or when the “buy, hold and prosper” types chant their mantra, they may be biased by uncritical confidence in the successes and good intentions of their known and familiar layer, the secular western world since 1945.