Have you seen what the price of silver has been doing? On Monday, it exploded past 20 dollars an ounce, and as I write this article it is sitting at $20.48. Earlier today it actually surged above 21 dollars an ounce for a short time before moving back just a bit. In late March, I told my readers that silver was “ridiculously undervalued” when it was sitting at $15.81 an ounce, and that call has turned out to be quite prescient. The Friday before last, silver started the day at $17.25 an ounce, and it is up more than 18 percent since that time. Overall, silver is up more than 30 percent for the year, and that makes it one of the best performing investments of 2016. So what is causing this sudden surge in the price of silver? This is something that we will discuss below…
This sudden spike in the price of silver has definitely caught a lot of analysts off guard. Some are suggesting that the fact that the Fed is now less likely to raise rates after the Brexit and the fact that the dollar has been slipping a bit lately are the primary reasons for silver’s rise…
This isn’t a gradual increase either. It’s an explosive growth spurt. Just three months ago silver had reached an 11 month high. Now silver prices have reached a 23 month high. Several factors appear to be influencing these gains, including a weakening dollar, and the fact that the Fed may cut interest rates in light of the Brexit vote.
Personally, I don’t buy those explanations.
To me, the continuing implosion of major banks over in Europe is the main factor that is driving investors to safe haven assets such as silver.
Rumors continue to spread that Deutsche Bank is essentially insolvent at this point, and many are watching for the imminent collapse of the largest and most important bank in Germany. When this happens, it will be a much, much more cataclysmic event for the global financial system than the collapse of Lehman Brothers was back in 2008.
But today I want to focus on the ongoing implosion of the major banks in Italy.
Italy has the 8th largest economy on the entire planet, and their banks are drowning in approximately 400 billion dollars worth of non-performing debt.
The Italian government would like to bail these banks out, but the rest of the EU appears ready to block that effort because it would violate EU rules. As a result, the big Italian banks experienced a bloodbath on Monday…
Italy’s Banca Monte dei Paschi di Siena SpA BMPS, -13.99% closed down 14%. The move came after a report that the European Central Bank is pushing the lender to draft a new plan aimed at reducing non-performing loans.
Other Italian bank shares were lower, with Banca Popolare dell’Emilia Romagna BPE, -6.73% down 6.7%, Intesa Sanpaolo SpA ISP, -3.04% off 3% and Banca Popolare di Milano SpA PMI, -1.40% lower by 1.4%.
And these stunning declines come on the heels of last week’s nightmare…
As a reminder, the Euro Stoxx Banks index was down -0.88% last week and is nearly 19% down from its pre-referendum levels. Italian Banks are at the heart of that weakness with the likes of Unicredit, Intesa, Banco Monte dei Paschi and UBI down -9.78%, -3.44%, -15.79% and -6.11% respectively last week, in the process sending Italian stocks to levels not seen since Draghi’s famous “whatever it takes” speech.
So what happens when all of the major banks of a country collapse at the exact same time?
Basically, Italy is facing “financial Armageddon” if nothing is done, and so some Italian politicians are desperate to step in and do something about this crisis even if it means defying the EU…
The Financial Times reported Sunday that Italy was prepared “to defy the EU and unilaterally pump billions of euros into its troubled banking system if it comes under severe systemic distress … despite warnings from Brussels and Berlin over the need to respect rules that make creditors rather than taxpayers fund bank rescues.”
Citing “several officials and bankers familiar with the plans,” the FT said that the threat has raised alarm along Europe’s regulators “who fear such a brazen intervention would devastate the credibility of the union’s newly implemented banking rule book during its first real test.”
But of course the rest of the EU is not about to let this happen because it would be a gross violation of European Union rules…
Michael Hewson, chief market analyst at CMC Markets UK, said: “Under current EU state aid rules any attempts to help banks must involve a bail-in process that doesn’t involve using taxpayer’s money.
“Italian Prime Minister Matteo Renzi has tried to argue that the Brexit uncertainty has destabilised Italy’s already fragile banks.
“The reality is the problems of Italy’s banks predate last week’s Brexit vote, and he knows it.”
So what is going to happen?
Could Italy be forced to leave the EU?
Will the rest of the European Union eventually cave in and save Italy?
We all remember how difficult it was for the EU to save Greece, and they are just the 44th largest economy on the planet.
So where in the world are they going to come up with the resources to rescue the 8th largest economy on the planet?
Immediately following the Brexit vote on the Friday before last, we witnessed the biggest one day global stock market loss in world history. But since that time many global markets have bounced back, and a lot of people seem convinced that the crisis has passed.
Unfortunately, the truth is that the crisis is just getting started. As I warned before the Brexit vote, European banks were going to continue to implode no matter what the result was, and that is definitely what we are seeing come to pass right now.
Without bailouts, virtually all of the major banks in Italy are going to fail. It is just a matter of time. And each of those failures would send financial shockwaves all over the planet.
Personally, I am convinced that the second half of 2016 is going to be even more eventful that the first half of 2016, and this new global economic crisis is going to continue to accelerate.
Unfortunately, most Americans are preoccupied reading about Taylor Swift’s new boyfriend and things of that nature, and so they are totally oblivious to the global events that are about to turn their lives totally upside down.
Author: Michael Snyder
Michael Snyder is a former Washington D.C. attorney who now publishes The Economic Collapse Blog and End of the American Dream. Michael and his wife Meranda believe that God is raising up a Remnant in these last days (Revelation 12:17; Revelation 14:12) that will bring in the greatest move of God the world has ever seen and the greatest harvest of souls the world has ever seen.
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I have been warning some people since last December after I read David Wilkerson’s prophecy. Nobody believed. Past a few days I have been warning them with articles from WSJ and FT. Still nobody believes. (I live in Italy). It’s like people don’t want to believe hard times are coming. They are busy planning vacations. Even my husband says Italy is too big to fail and EU won’t allow it to happen. I am greatly concerned how they would cope when it happens….. 😢 Please pray for people in Italy!
Chloe,
I would start talking to your husband about taking your daily limit out of your accounts before this crisis gets worse. Italy is the 8th largest economy in the world. When your banking system fails they will set limits on daily withdrawals just like they did with Greece.
There are numerous articles about the banks that are about ready to collapse in Italy. If you belong to one of them get your money out as fast as you can.
Don’t give up hope warning your family and friends. They will remember what you said when it starts happening.
Thanks Ed. I keep only the minimal amount in my bank account. I have been withdrawing most of it each month since last April. I am also hoping my husband would do the same but so far no luck! (We have separate bank accounts) I just read more news on EU banks and it seems the situation is getting even worse today. I will continue warning……
Yeah, well, they put Jeremiah in prison, too.
I agree with Ed h’s comment and advice, and would add that, given its size, a banking crisis in Italy is not contained within Italy.
Yes. Dean. That’s true. I have also warned friends in Germany, France, UK and Greece…..
Great article Michael. Thank you for continuing to sound the alarm. The smoke is now visible, despite the disbelief of the masses that a fire of Biblical proportions is at our door steps.
Just a note that I wanted to make as per last post on z3 was alerting bearish sign for silver to lower price pull back. In 1980, the price of one ounce of silver reached $ 50. Today, the purchasing power of the US dollar is substantially less than in 1980. The price of one ounce of silver would have to rise to $ 150 to reflect the value of the US dollar thirty years ago, assuming an average annual inflation of 3.5%.
: During the financial crisis of 2008, the silver price corrected 57% from the high of $ 20.79 down to $ 8.95. This correction was followed by a spectacular rise of more than 400% to $ 48.42. With the financial crisis ahead, we will see some volatility as per history is my opinion.
Great point Danny! I believe silver is going to drop sharply when the crisis hits.
John Paul in 2013. See my previous post.
https://z3news.com/w/england-brexit/#comment-46143
John Paul J – Jim Bakker Show (29th April 2013)
Right now Gold is plummeting which The Lord told me, He said “Gold will go up to nearly $2000 an ounce and then it will plummet”; it’s going to go down more [around $1400 at the time]. There is manipulation in that market to transfer wealth. For years JP has said to people gold is going up but if you are going to buy gold you better be prepared to hold it because it is going to take a dramatic drop and it will drop well below $1000 an ounce and it will get up to nearly $2000 an ounce so you need to be prepared for that type of thing to happen.
A sensible approach might be to hold on to physical gold or silver and look to buy more at lower levels (lowering average cost) as and when there is a drop below $1000 an ounce for gold. Many different sources are now showing that physical supplies are very low and many paper funds will be unable to facilitate delivery if asked. So a drop below $1000 may not necessarily provide opportunity to add to physical positions.
James, I have been ‘watching’ the PM cartel/manipulators for several years now. They are running out of time (and they know this), but I believe they still are potent. They could be ‘allowing’ the price to rise one final time before the market crash, in which they will go ‘all in’ to crash the PM’s one final time and scoop up the remaining physical. This could coincide with season two/three (of the US dollar). Food for Thought…
Timothy – Any updates on the job front?
Bless you Charles, for continuing to think of me and my family. I just heard this morning from the recruiting firm I am using that i have been selected for the position I interviewed for. However, I am awaiting the ‘official’ phone call from the hiring manager before issuing a Praise Report. I expect this call either today or tomorrow. Please continue to pray for me (as you have been)! The prayers of yourself and the other Z3news team have undoubtedly reached heaven and our Lord!!! The Lord truly listens to those who LOVE Him (such as yourself, James, Phanuel, etc….). I will inform once it is official. Also, i believe i made a promise to make a donation to James site if this was accomplished, which I will do once its official.
Peace be with you,
Timothy
This is great news Timothy.
Great news. Our Lord is faithful and true.
Shalom Brother
Tim – We are eagerly anticipating with you and your family, for you to receive the best God has for you; to be positioned for His provision and abundance! Gods favor and blessing to you Tim!
Silver and gold will continue to be “hit” as it resumes its’ bull market. Will it drop a few dollars at some point? Probably. Will it hit new lows? Probably NOT so much.
I hope everyone profits from their paper trading, but physical silver will not be available for those potential cheap prices in large quantities. Only the “weak hands” (or those in dire need of cash to pay bills) will sell their physical if the price hits new lows.
Always one more smash, huh?
Thanks for your summary Danny……This is not 2008. Debt has exploded. Currencies are going down. Central banks are buying. The world is buying. The Fed is broke. EVERYBODY’S broke… ALL of those elements were not present in ’08……More important…..GOLD AND SILVER ALREADY HAD THEIR CORRECTION/BOTTOM.
In ’08 markets dropped and metals followed (I know, I was there). Today, when markets fall metals rise (as they should) because TODAY it is the ONLY protection from currency devaluation. Today gold goes up WITH the dollar. The reverse correlation is dead.
if its available, I wouldn’t mind getting some more at a lower price. But in back of my mind I still remember what book of Revelation says–“they will thrown their gold and silver in streets.” I do not think powers of darkness want us to win, the bankers/sell outs they want to win but indviduals no–evenutally they will go to digital currency but pm may be a step there. China central bank already announced plans to go to digital currency in the future. Europe and America’s war on cash and negative rates points to same
I agree with this comment regarding the revelation and that price of barley will sky rocket (meaning food). The number of beast and the implementation on forehead and right hand does sound to me that there will be a total global collapse in fiat currency. This is very close to end time as the technology is already here. I believe bitcoin is a way to condition ppl at this time. Many people who never knew are now talking about or buying bitcoins or any other digital currencies.
I do think that God will give us the guidance.. For those who love God and faithful to him..
God bless Z3 members! Hope everyone stay safe.
I think you’re referring to Ezekiel, not Revelation, about casting PMs into the streets.
I wouldn’t let that verse be discouragement from owning PMs, for two reasons.
First, it occurs “in the day of the wrath of the LORD,” so, on that day, a full larder, a rainwater collection system, property in the Cayman Islands, nor PMs will save anyone. But we’ve got a lot to go through before then.
Second, look at the hundreds of verses where gold and silver are clearly deemed to be of value.
Daniel,
When reading your post, i couldn’t help thinking about a fairly recent article written by Ann Barnhardt (www.barnhardt.biz). In the article, she indicated that many people today are ‘giving away’ their silver (i.e. selling for prices much lower than true value) in exchange for fiat paper (which will soon be worthless). Every indication I have been given is that Gold and Silver will retain wealth which can be utilized to help others.
God Bless,
Timothy
Silver is on its way to break the 50 day moving average (MA):
https://srsroccoreport.com/condition-red-important-silver-threshold-line-broken-what-next/
Bank and Brokerage Stability I wanted to share some alerts and research that may affect all of us. Like many of you I have positions in Deutsche Bank (DB), FAZ and others that will benefit from a drop in the DJ/SP500. I purchased puts on DB at 17 and now every day the share value decreases irrespective of the recent market ups and downs. We’re all excited anticipating a market drop in order to see our profits but I want to provide a ‘heads-up’ alert for your consideration. Barring some unknown intervention, Deutsche Bank may soon follow the path of Lehman Brothers in 2008 and collapse. Our short positions will increase in value, but DB’s collapse will also likely bring down other major EU banks as well as some of the weaker banks in the USA like the Bank of America. You may recall in January 2015 that the Swiss Natl Bank un-pegged the franc from the Euro. Overnight there were huge losses by many Forex brokers. My FX broker went bankrupt and even large brokers like FXCM in the US had difficulty covering its losses. If three major banks in the EU and USA collapse, a financial wave much bigger could collapse brokerage firms and secondary banks. My point is that we should all review the stability and ability of our personal brokers and banks to consider if they will survive the historic levels of stress that may soon hit the global financial network. It will be a pity if our trade strategies and selection are perfect, but our brokers or home bank go bankrupt. It’s not too late to spread risk between a couple banks and brokerage accounts. Here are some bank reviews that consider the stability of banks based on their true assets versus exposure to outstanding… Read more »
Good morning!
DB collapse watch
Another day of new lows
BAC stock should be worth more than DB stock soon ( this is incredible)
Wow!!!
They sure are having a race to the bottom. Possible the 25th crash might be this month.
Good stuff Michael!!! As always, you stay on top of things! I am watching and waiting for the David Wilkerson prophecy of Germany and it looks like it may be right at the door…
I knew it. About 3-4 weeks ago, I made a simple, innocent comment about Italy. It was when I had just started praying in the spirit. I kept saying Italy but just not in English. Italy is a very big concern of mine.
Funny. ITALY. I trust and love you.
Good article.
Do you think we’ll see a retrace of the silver price or do you see it just continuing to accelerate from here?
My personal thought is that the silver/gold will rally until a week before the FOMC announcement as the fear of interest rate hike will come in play.
Danny, What is the FOMC announcement??, thanks
This is why there is no stopping this SILVER and GOLD price RISING trend…http://didthesystemcollapse.com/
The Shanghai Gold Exchange is the REAL market that deals in REAL GOLD and SILVER and sets the price based on SUPPLY and DEMAND.
The london bullion market is the FAKE market that deals in FAKE and FRAUDULENT paper gold and silver and sets the price based on TRICKERY and FAKERY. The WHOLE WIDE WORLD is now taking their business to the REAL market. Those who continue doing business in the FAKE market are the (“PAPER LOSERS”) and those with the wisdom to move to the REAL market are the (“METAL CRUISERS”).
http://www.believeinjesus.com
You can keep track of both exchanges setting the prices here:
http://didthesystemcollapse.com/
Great site Jerry !!! Thanks for posting. Fascinating times we live in. 🙂
Awesome little site, thanks!
…and another thing. This is NOT about West versus EAST. This is about right (REAL market) versus wrong (FRAUDULENT market).
I’m a BIG believer in FREEDOM. Free people use REAL MONEY (PHYSICAL GOLD AND PHYSICAL SILVER). Enslaved people use FAKE, FRAUDULENT MONEY (paper notes of any kind. ALL of them historically have gone to ZERO and will continue to go to ZERO because ALL FRAUDS without exception end up in ZERO. PHYSICAL GOLD and PHYSICAL SILVER after thousands of years are still here!!!) http://www.believeinjesus.com
“Gold is the money of kings, silver is the money of gentleman and fiat paper is the money of slaves.”
The Number One Goal to Own Gold and Silver is NOT What You Think It Is…
http://www.zerohedge.com/news/2016-07-07/number-one-goal-own-gold-and-silver-not-what-you-think-it
http://www.believeinjesus.com
Jim Rickards and Egon von Greyerz discuss $10,000 gold…
Investors must be aware of to protect themselves against the major risks in the financial system…
http://investmentwatchblog.com/jim-rickards-and-egon-von-greyerz-discuss-10000-gold-investors-must-be-aware-of-to-protect-themselves-against-the-major-risks-in-the-financial-system/
http://www.believeinjesus.com
Federal open market committee meeting. When the fed governors meet for a two day meeting to discuss state of the economy and set interest rates.
And the Deutsche Bank is three times larger than Lehman Bros.