A Precious Metals Margin Call Part 2: Bank of England Defaults
The Global Monetary Reset in gold is about to happen.
Good Morning - What is the base layer of every monetary system? Answer: Gold.
Ultimately, despite claims otherwise, even the Dollar System is still backed by US (and Western) gold reserves (Fort Knox, NY Fed members bank vaults etc.). To be clear, what this means is that as Western indebtedness explodes gold reserves will become of seminal importance, just as they were during the Depression and throughout monetary history. Vaults will be audited.
I wrote about a coming gold margin call in the London Metals Exchange (LME) in Part 1 back in June, and its connection to broader themes such as: the rise of BRICS, the repatriation of financial power via Gold shipped from West to East in the Shanghai Gold Exchange (SGE), and how the meteoric rise in gold means a financial emergency is imminent. It seems clear to me that SGE has surpassed LME in terms of physical bullion and could backstop the post-USD monetary system.
Why does this matter right now? Well, according to the Financial Times the LME has been experiencing acute shortages in recent weeks because of gold shipments from London to NYC. Allegedly, this is because of fears of imminent Trump tariffs on raw materials, including gold. However, the cover story masks deeper problems.
The UK is in the throes of a dangerous fiscal crisis as we speak. Yields are rising on Gilts (UK Treasuries) as the Bank of England (BOE) struggles to backstop a fiscal catastrophe even government officials are acknowledging is completely out-of-control. Remember, pension funds, banks and other financial institutions who own Gilts are coming under strain as high rates rapidly depreciate their "pristine" assets. Remember the Liz Truss Moment in 2022?
Worse, the immigration problem in the UK (like Germany, France and the US) has reached a boiling point that threatens to collapse social stability and rule of law in the UK full stop. Why? Because millions of foreigners cannot survive without massive social services and the UK economy has been completely hollowed out. The UK government is the only enterprise at scale left and it is defaulting.
The UK government is the only enterprise at scale left and it is defaulting.
A shortage in the LME equals a shortage of gold in the BOE and by extension the UK government, which means a fiscal meltdown is knocking at the door. I say again, a fiscal collapse and the subsequent racial collision UK elites have wrought on native Britons is close at hand.
The racial collision UK elites have wrought on native Britons is close at hand.
Finally, the implications for the US are equally dire. Any margin call in the LME will spill over to US markets and the Eurozone, as will a spike in yields and a subsequent default spiral in the BOE. The Fed is the final line of defense and they will be forced to step in. However, the only extinguisher for this scale of monetary fire is gold. Again, vaults will be audited.
Unfortunately, there is more untoward behavior operating behind the scenes because the new Trump administration is led by Howard Lutnick who headed Trump’s Transition Team and is now vying to become Commerce Secretary. Lutnick has been pushing a bizarre scheme to clear US Treasury’s abroad through a London based exchange run by the LCH Group. Author and investor Alex Krainer believes, as I do, that Lutnick’s plan enables the City of London banks to leverage US Treasuries (USTs) as collateral to backstop the BOE and by extension ballast the UK government.
Needless to say such a move is unprecedented in American history and exposes USTs to massive risk, especially if a margin call spreads in the LME. Is Lutnick working on behalf of the banking class to siphon off US Treasuries to prop up the UK government and the BOE? If so, and the gold margin call worsens could that cause further disruption in the US Treasury market and put the solvency of the US Government (USG) at risk for a foreign power? The answer seems to be yes.
Given these vulnerabilities, if England teeters into insolvency that gets us back to the base layer of the Dollar System - gold. Any panic in the gold markets will spread and questions will arise until banks are audited: Does the USG have the gold? Has JP Morgan and HSBC (the custodians of the LBMA) and the Fed+Treasury effectively maintained sufficient physical supply to backstop paper markets? In other words, does the US have the gold it says it has to backstop the Western financial system?
As this financial fire spreads from Europe (and Asia) to the US we will soon find out. The base layer is gold, and the end-of-cycle margin call of that base layer is about to begin.
Stay liquid, stay alert.
I would actually say that Lutnick's plan in neither new nor alien, unfortunately. 2008's intervention went to funding in a big way several foreign banks to stop them from falling apart, using junk MBE's as the name of the reason, but it was really an international eurodollar crisis afaik. This market exists because certain financiers in London, as a part of the marshall plan due to bretton woods, was given the ability to give loans denominated in USD as a means of nominally helping reinvigorate a freshly destroyed England, but also creating international demand for dollars. Let this money printing go unbridled and uncontrolled for 70 years, and here we are. The Fed was also the backstop for the world's crisis in the form of the reverse repo shitfest just prior to covid (although some may say that covid, which was essentially the flu, was a tool of policymakers used to distract from our disgusting and broken eurodollar system and international finance system. Us banks are pretty clean, actually, but there are so many scheisty institutions abroad that are absolutely not.).
I am in complete agreement that the next crisis could begin with the gilt market collapsing. The british pound is reaching parity again with the dollar and when this happened last time, is when Liz Truss's interim government almost blew up the world economy, because of the gilt market nearly going tits up. Of course, the new british financial managers and ministers are equally as fucktarded, and will continue to fund the unwashed islamic hordes to their own country's demise, rather than kick them all out and save the money.
The OBR recently announced each black is “fiscally negative” to the tune of £485,000 EACH. This assume they live to age 81 (average). They also assume the HAD NO DEPENDENTS. They could not bring themselves to do an actuarial calculation on that as it would have made the liberals wince. 🆘WE NEED A REFERENDUM ON DIVERSITY. KEEP THE BLACKS. OR GET A 40% TAX CUT. No one signed up to keep these cunts fed and watered did they?. REMIGRATION is the only solution