Chart: It Hasn't Been This Bad in 100 Years

In just over 24 hours last week, US Treasury secretary Janet Yellen's financial markets are operating in a fine line, changed to concern about the loss of adequate liquidity in the US Treasury market.

Many believe this is a forewarning that the fiat Federal Reserve and US Treasury will begin bailing out the largest bond market in the world with another seemingly infinite QE cycle to come soon.

The interest rates on USA IOUs have been screaming higher, yet in real terms, they have been some of the most significant losing investments this year. The yields across the curve have yet to even hit the underreported core PCE price inflation rate.

Meanwhile, across the Atlantic rumors continue swirling about Credit Suisse, a significant derivative trading globally systemically important bank (G-SIB).

NY Fed data shows that the Swiss National Bank and the European Central Bank have tapped the fiat Federal Reserve for short-term US dollar loans. The exact reasons for their need are not known yet.

The 15 yr UK Gilt bond has lost over half its value since 2020.

The typical 60% stocks and 40% bonds portfolio performance meltdown in 2022 is now the worst on record, beyond losses seen during the 1930s Great Depression's kickoff.

Commenting on this terrible stock and bond market performance, Dylan LeClair writes, 

"The last time the US market faced a drawdown of this magnitude, the US Government defaulted on its gold peg within the next 24 months.

1933 - Executive Order 6102

1971 - Nixon Shock 

Not the best quadrant to find our 2022 financial markets.

And now it appears the runway is being laid for yet another cycle of bailouts and infinite QE insider Treasury looting as the global financial markets stumble into dysfunction again.

Alleged criminal and CEO of JP Morgan Chase, the world's most globally systematically important bank (G-SIB), had the following take on where financial markets are going this week.

Turning to this week's underreported US government price inflation data update called the CPI or consumer price index... it came in hotter than expected with an +8.2% measurement.

Even historically high price inflation nations like South Africa, Brazil, and India have lower official but likely suppressed price inflation figures (underreporting price inflation is typically in a government’s interests).

Many asset classes sold off on the big US price inflation surprise. The twisted logic is that such a high US inflation number sets the stage for the fiat Federal Reserve to raise rates again soon.

Near anywhere one looks in the world, it's hard not to find a fiat currency in issuance that is not losing double digits in real price inflation per year vs. real goods and services. In short, maintaining one's quality of life appears to be getting harder nearly everywhere.

And while headline price inflation adjustments for fixed-income retirees look large, safe to bet these paltry sums are not keeping up with price escalations at home and abroad.

The silver prices and gold prices sold off steadily through this CPI price inflation update week.

The spot silver price closes near $18.30 oz while the spot gold price closes near $1650 oz.

The gold and silver ratio blew back up to 90 again.

Given the fallback in silver and gold spot prices, our physical gold bullion and silver bullion buying clients have been buying the spot price dips again in heavy volumes.

The industry continues to see robust bullion buying sprees on silver bars and silver coins, especially when fiat US dollar spot prices dip. This week is no exception; large bullion buy volumes are taking place.

And it's for real reasons the news I am bringing you here goes deep into the core of an increasingly shalier global financial system. Simultaneously, the circulating fiat currencies store value about as terribly as the 1970s.

Add into this crazy cocktail the ridiculous amounts of capital looking for safe havens, and our relatively tiny physical bullion market has a potential coming ticket to unaffordium, unfindable, good-luck land.

Of course, we'll be here next week to give you the SD Bullion Market Update.

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That's all for this week, as always, to you all out there.

Take great care of yourselves and those you love.

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James Anderson
James Anderson
Senior Market Analyst & Content

A bullion buyer years before the 2008 Global Financial Crisis, James Anderson is a grounded precious metals researcher, content creator, and physical investment grade bullion professional. He has authored several Gold & Silver Guides and has been featured on the History Channel, Zero Hedge, Gold-Eagle, Silver Seek, Value Walk and many more. You can pick up Jame's most recent, comprehensive 200+ Page book here at SD Bullion.

Given that repressed commodity values are now near 100-year low level valuations versus large US stocks, James remains convinced investors and savers should buy and maintain a prudent physical bullion position now, before more unfunded promises debase away in the coming decades...