NEW YORK ( Bullion Bulls Canada) -- At the beginning of this series I acknowledged there was considerable analytical overlap among the three trends I would discuss and explain. In Part II, readers saw how the imminent flight out of paper will be a direct consequence of the excessive money-printing we are seeing today. Creating a massive imbalance today will lead to an exodus of capital tomorrow.
Similarly, in Part III we will see how the long-term destruction of the supply chain for the gold and silver markets is also a consequence of excessive money-printing, albeit indirect, along with price suppression.
The dynamic here is as simple as it is irrefutable: Low prices cause high prices.
What has caused the 10-year-plus bull market for gold and silver, where prices have begun to move toward their fair market value? It was the 20-year bear market, where both the price of gold and the price of silver were driven well below the cost of production for approximately 90% of the world's gold and silver mines.Obviously the lower prices went, the fewer miners chose to remain in production. So at precisely the same time that extreme, artificially low prices for gold and silver were stimulating more demand, those prices were also destroying supply. The inevitable result was the collapse of inventories. In the typical short-sighted manner in which the banking cabal operates, they had an "answer" for the collapse in mine-supply: dump their bullion onto the market. Thus to temporarily shore-up inventories the central banks emptied out their stockpiles of bullion, dumping thousands of tons of gold and silver onto the market over those years. This brings us to the year 2000, and the turning point in the bullion-manipulation game. The supply/demand fundamentals for gold and silver had been warped to such an extreme that the price of gold and silver began rising even while the bankers were continuing to dump 500 tons of gold per year onto the market -- the most extreme gold-dumping in all of human history. Indeed, to illustrate how radical that gold-dumping campaign was we need only look at the media propaganda which accompanied the one-time sale of 400 tons of gold by the IMF in 2009. For a year and a half (as the banksters struggled to have the sale approved) we were subjected to endless media fear-mongering that this one gold-dump of 400 tons would tank the whole market.