Last week we learned that BlackRock, an investment manager of over $6 trillion in stock and bond funds, six times the size it was before the 2008 global financial crisis, effectively published a working blueprint for the current bailout regimes ongoing within the USA and via other nations in the western world.
This plan was published and communicated in August 2019 at the G7 summit of central bankers in Jackson Hole, Wyoming. This was only a few weeks before September 11, 2019, when the NY Fed REPO Loan ramp program began. The still ongoing overnight lending program, driven by the private Federal Reserve, has to date made over $13.3 trillion in short term loans by “going direct” to the 24 primary dealer trading houses on Wall Street.
In the August 2019 report, BlackRock suggested in the next downturn (as in perhaps the Depression going on right now) that blurring the lines between government fiscal policy and central bank monetary policy – precisely what the current US Treasury and the private Federal Reserve are doing today in the United States, is what will be required for medium and long term goals.
This last summer 2019 report basically auditioned BlackRock for its current role in these unprecedented global bailouts. Blackrock has of course been hired by the Federal Reserve, the Bank of Canada, and Sweden’s central bank, to implement key features of their plan. Three of the authors, previously worked as central bankers in the U.S., Canada, and Switzerland, respectively.
higher INFLATION rates ahead to make up for past 'misses' & future expectations
combining the US Treasury & Federal Reserve so lead managers like Steve Mnuchin and Jerome Powell can pick and choose winners and or ignore losers along with the great bailout we are witnessing.
Like during the 2008 GFC, today too, BlackRock has again been selected in more no-bid contracts by the Federal Reserve.
This time BlackRock is the sole buyer of corporate bonds and corporate bond ETFs for the Fed’s unprecedented $750 billion corporate bond-buying programs which will include both investment grade and junk-rated bonds (something which is illegal for the Federal Reserve to do but given the melding with the US Treasury, they'll just sidestep those laws effectively. No one is stopping them.
And too, BlackRock is also being allowed by the Fed to buy its own corporate bond ETFs as part of the bailout program to prop up the almost junk grade corporate bond market.
Here are some of those purchases to date. You can see many BlackRock iShares corporate bond ETF "investment vehicles" have been purchased.
As we await the coming Bankruptcy Phase from this viral economic lockdown, the following chart is worthy of pondering.
Turning to the Gold Market
Interesting news out of China regarding its physical gold market of late.
"China’s central bank and customs authority said on Tuesday they would simplify procedures for companies exporting gold, following a slump in domestic demand for the metal."
Judging by the latest export and import data... it looks like Chinese gold market players are likely leveraged with bills of credit to pay in fiat currencies, and thus the world's largest gold market is now exporting more gold than it has for many years.
The Reuters story goes on to state,
"In April, China’s exports of gold via Hong Kong exceeded its gold imports via the territory for the first time since at least 2011, and Switzerland, which usually sends tens of tonnes of gold to China every month, shipped no metal to the country at all."
In our market update video last week, we showed you this 2008 through March 2020 US gold import chart. These likely fresh gold bullion bars imported from Switzerland to the USA are now happening at a record pace.
The number of gold bullion bars imported from Switzerland to the USA in April of 2020 alone doubled this tall bar you see in the video updated through March 2020.
Over $6 billion in gold bullion bars were shipped to the USA, and typical gold bullion importing nations like China, Hong Kong, and India are almost nonexistent. See the related chart below.
Looking at the COMEX gold warehouse data, it looks like the majority of these freshly imported Swiss gold bars have funneled into the Brink's NYC warehouse.
See the recent increase of about 5 million ounces of gold or over 154 tonnes on this chart here.
Let's see how long this gold remains in the COMEX fractional reserve system.
The COMEX gold stopped contract delivery data is showing a record size of over 45,800 contracts theoretically representing over 4.5 million ounces of the potential gold deliverable. See the related COMEX gold delivery chart below.
This is the largest volume of stopped contracts in over 15 years of time.
Is it any wonder why record physical gold has been coming over to the USA from Switzerland?
It appears we have a COMEX emergency, one can only be satisfied by record physical gold deliveries.
How many high net worth investors are now bypassing the derivative complex and moving to the real things for the 2020s?
That is all for this week. Take care of yourself and those you love.
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.