Friday, August 31, 2012

Art Cashin - The Most Disastrous Economic Event In US History

'PM tells US 'time has run out' on Iran diplomacy'

Speaking of...hey, it's NFL time!  All is well.

Ben Bernanke should return the Fed to its golden roots
Herbert Hoover, who knew a thing about monetary disorder, entered an eloquent warning in his memoir against the pure paper dollar. Currency convertible into gold at a fixed rate, he wrote, “is a vital protection against economic manipulation by the government. As long as currencies are convertible, governments cannot easily tamper with the price of goods, and therefore the wage standards of the country. They cannot easily confiscate the savings of the people by manipulation of inflation and deflation. They cannot easily enter into currency expansion for government expenditures."

The Real Reverse Robin Hood: Ben Bernanke and his Merry Band of Thieves

Classic Hugh-Smith.

Former Fed Governor Heller: "Fed Will Not Act Before Fiscal Cliff Resolved"

"Former" is the operative word here.

Time for eurozone to reach for the gold reserves?

The author raises a legitimate question, but still doesn't understand this fundamental principle:

"Gold is money.  Everything else is credit." - JP Morgan, testifying before Congress in 1912

Apple Loses Patent Lawsuit Against Samsung in Japan

I figured Apple would win in the US with their patent lawsuits vs. Samsung, and would probably win in South Korean jurisdiction, but now Japan?  Hmmm...Jim Rickards brilliantly forecasted a currency war in the making, and these lawsuits are more evidence of continuing trade wars.  Let's hope we avoid the inimitable military conflicts.

Ron Paul Recants The GOP, Just Says No To Keynesians

Paul Krugman’s Mis-Characterization Of The Gold Standard

Wednesday, August 29, 2012

Expect $2,000 Gold & A Massive Squeeze In A Key Commodity

Unilever sees 'return to poverty' in Europe

In hard times, “I buy gold” is Italy’s boom business
“Since I was a child I remember that gold was given as a gift on various occasions and people used to say: ‘Put it aside’,” said Ivana Ciabatti, who represents gold– and silversmiths at employers’ lobby Confindustria.

“We used to laugh at it, but they turned out to be right. Many families are surviving thanks to this gold.”

Gold Runs Out in Lisbon as Price Drop Compounds Money Misery

And the bashers say gold isn't money.

The Rot Runs Deep 3: The Capture of the Professional Class

The Atlantic Weighs In on the Gold Standard …

Some clear thinking on the debt

Agnico CEO Warns Gold To Hit $3,000 On Supply Concerns

Steve Keen on Austrian Economics

Why Everybody's Going To War in the Middle East

Chart Of The Day: From Pervasive Cheap Credit To Hyperinflation

Euro Gold Technicals Look Near Perfect

Monday, August 27, 2012

Champions of Dishonesty
“The Fed is manipulating so many markets at once that it has become tougher to identify a genuine free-market price in the financial markets than to identify a genuine female in a Bangkok bar… I don’t want to play in markets like this.”

The Endless War: Saudi Arabia Goes on the Offensive Against Iran

So wait a minute:  Israel is at war with Iran.  Israel is at war with Syria.  Hell, Israel is at war with everybody in the middle east.  Iran supplies oil to China and Russia, who are considered allies.  But now Russia is making nice with Israel.  The US was at war with Iraq, and now Syria and Iran.  Russia and China are at odds with the US in the battle for natural resources.  Saudi Arabia and the US need each other, but at what price?  And now the Saudis are at war with Iran, too.  The US used to be "allies" with Egypt, but turned against their leader.  The US was also at war with Libya's Gaddafi.  Hell, we were also allies with Hussein of Iraq at one point--in our war against Iran, before turning against him.

I'm confused...except for one thing.  The region will never get sorted out.  They haven't made peace with each other for thousands of years.  With billions of people starving or about to starve due to soaring food prices, they won't all of a sudden start singing Kumbaya.  And if/when they go to war, oil prices will spike, making everything go from bad to worse.

Ultra Easy Monetary Policy and the Law of Unintended Consequences

This white paper appears to be authored by a "conspiracy theorist" since it makes so much sense on the unintended consequences of printing money out of thin air.  Only problem is it was written by the Fed itself, the Dallas branch to be specific.  Paul Krugman, you have been wrong, and you continue to be wrong.  But keep kissing that Nobel prize in your trophy case if it makes you feel any better.

Heck, Ron Paul, the Fed's biggest critic, could have written this paper, and everybody would have dismissed it.  But now the Fed is criticizing its own policies?  Blasphemy!

Why Bloomberg Is Not The WSJ

Lulled to Sleep

"This Is Just The Beginning" As LIBOR-Manipulation Liabilities May Top $176bn

The Tempest Has Left the Teapot

The Santelli Exchange: QE Has a New Name: Counterfeiting

Ron Paul feted in raucous six-hour farewell rally

Gold, Jim Grant, Bernanke, Draghi & A Collapse In Confidence

Keynesianism vs. the Gold-Coin Standard

Thanks to Kitty for finding this one.

Sunday, August 26, 2012

The purpose of market intervention

Smart Money acknowledges its big miss with GATA and gold

The editors at the soon-to-be-defunct Smart Money magazine admit they were dumb on gold.  Perhaps it's one of the reasons they are going out of business.  The other probably includes the retail investors' distrust of rigged markets.

Imagine that:  they thought gold would plummet when it was priced at $422/ounce back in 2004.  How much gold would you buy today at $422?  Answer:  as much as possible.

How about at $1670?  The answer a few years from now could be the same.
GATA explained it to Smart Money then and since then has been explaining it to everyone else with eyes to see and ears to hear. But while you can lead a financial journalist to a central bank, you can't make him ask the right questions. 

Absolutely Stunning Development In The Gold & Silver Markets

Time will tell how this will play out.  Tread carefully--the ride is about to get awfully wild.

Fake Celebrity Pranks New York City

This video is living proof of how narcissistic, fraudulent, and stupid we've become.  But it's still hilarious.

Why you always want physical EVERYTHING…

Discount Rate For Banks: 0%; Discount Rate For The "Rest Of US": 400%; For Everything Else There's TaxpayerCard

On This Week In History, Gas Prices Have Never Been Higher

No inflation here.  Fail.

Empire State Building shooter killed

Keith Fitz-Gerald: The Perils of Underestimating Complexity & Mispricing Risk

"If you’re rich you get a bailout. If you’re poor you get a handout. And if you’re middle class you get left out. " That's not a sustainable way to run the system, exclaims investment strategist Keith Fitz-Gerald.

A cancer at the core of our current economy is the magical thinking, "no pain, all gain" philosophy, pursued by those running it. They are doing all they can to remove the consequences of failure from the system -- blind to failure's essential 'waste-clearing' function in a healthy free market.

Without the discipline of Darwinism, the individual actors in the system make all sorts of malinvestments that would never make sense in an efficient marketplace. But since the losses from these inane pursuits are socialized, there's no incentive to stop making them. At least, up until the point where the class who's back is burdened with paying for the socialized messes finally breaks.

US sending aircraft carrier back to Persian Gulf four months early

Israel said October.  I'm thinking why would a country telegraph an attack?  It either won't happen, or if it does, it won't happen in the timeframe they indicate.

Activist Post: Customer Deposits Are Property of the Bank: Close Your Account NOW

Is this hysteria?  Or a precursor?

Friday, August 24, 2012

Sprott - We Are Staring At Chaos & Collapse In Front Of Us

Only in America: Corzine Eyes Starting a Hedge Fund

Fed minutes show active discussion of QE3

PIMCO Buying Gold

Fed Easing Is a 'Done Deal': Bill Gross

Is gold heading to $4,500?


Gold & Silver off to the races

Public Pension Funds Named to Lead ‘London Whale’ Lawsuit

JPMorgan will receive a mere slap on the wrist.  Nothing here.

Republicans eye return to gold standard

Wow, I guess I'm not part of the lunatic fringe after all.

Sunday, August 12, 2012

People Are Frightened, Money Pouring Into Switzerland & Gold

Who Wants The Highest Crude Oil Price? Presenting The OPEC Cost Curve

Does the fact that Iran needs higher crude oil prices an indicator that their saber-rattling is an attempt to induce higher oil prices?  In fact, all OPEC exporters may have the same vested interests.  I know that's stating the obvious...

The Saudis keep insisting they don't desire higher prices due to demand destruction, but bigger profits for the lowest-cost producer must be very tempting to them.

Saturday, August 11, 2012

Decision by Netanyahu, Barak to strike Iran is almost final — Israel TV

The situation in Israel has gone beyond posturing.

What makes our NDAA lawsuit a struggle to save the US constitution


'JPM's $150 Billion FDIC Reality Adjustment' - Jamie Dimon Just Admitted To The World That JPM's Assets Are Overvalued By $150 Billion

Mark to model (i.e. mark to fantasy) accounting has replaced mark to market.  The whole banking system has cooked its books.

Moral Relativism and Patriotism as Weapons of the State

A Canadian's perspective on moral relativism and patriotism.  Which brings up an awkward point:  every loss of American life in Iraq and Afghanistan is tragic and unnecessary.  What about the deaths of hundreds of thousands of civilians in Iraq and Afghanistan, including many women and children?  They couldn't all be terrorists, could they?

This is not an indictment on Obama's administration.  Upon reflection, Bush II ordered the invasion of Iraq based on a false premise:  that Iraq had weapons of mass destruction.  Over a hundred thousand Iraqi's died as a result.  So what did the US say?  Ooops, sorry...for reconciliation, we'll help rebuild your country--the same country we destroyed.  And oh, about that oil...

U.S. regulators irate at NY action against Standard Chartered

Yes, laundering money for Iran is the headline, but the subtext is the cozy relationship between London and Washington is about to get icy.  The Olympic spirit lasted all of two weeks, as the sharks are now devouring other sharks.

The other subtext is US regulators are angry at New York regulators for doing their jobs, while the New York regulators are angry at the Fed and US Treasury for not doing theirs.

And caught in the middle is poor ol' Timmy Geithner, now US Treasury Secretary--and former New York Fed President.  He's barely recovering for his non-action during the LIBOR scandal, and now he is getting heat from all sides.

This finger-pointing exercise would be comedic if it wasn't so tragic to American consumers, whose purchasing power is being robbed blindly by the incessant manipulation of markets by the central planners.  My takeaway message?  They're all corrupt sociopaths, and their day of reckoning is rapidly approaching.  The current theater is amusing only because they are exposing each other.
I think it's a concerted effort that's been organized at the top of the U.S. government. I think this is Washington trying to win a commercial battle to have trading from London shifted to New York," said John Mann, a member of parliament's finance committee who also called for a parliamentary inquiry.

Mann, from the center-left Labor party, has become a public scourge of London bankers' greed and immorality during the financial crisis. But he told Reuters he saw "anti-British bias" behind "disproportionate publicity that's given to British banking problems as opposed to American banking problems".

A British executive at an institution which ranks among the top 25 shareholders in Standard Chartered saw, like Mann, a politically motivated move by U.S. officials irked by the major role London plays in the global financial industry, attracted big investments from major U.S. banks like JPMorgan Chase, Goldman Sachs and Morgan Stanley.

"Are we starting to see an anti-London bias in U.S. regulatory activities?" the executive asked. "Oh yes. Is there any subtle form of banking sector protectionism going on? Yes."

Fed's Williams now favors QE3

Actually, "open-ended QE" is a polite way of saying "QE to infinity", as Jim Sinclair predicted.  God help us all, as we are now headed toward currency destruction.

Thursday, August 9, 2012

Gold, Silver, Corn, And Brent Are Best Performers On The 5-Year Anniversary Of The Great Financial Crisis

Gold bashers won't like this chart.

Peter Millar: Seven-fold increase in gold needed to avert debt depression

Gold rush in India? Government steps in again
The Indian government is at it again. Worried that the flow of savings is moving towards investment in gold, India's Finance Minister P Chidambaram has said there is a need to spread financial literacy to encourage people to invest in market instruments and not bullion.

In the first two months of 2012, gold purchases in India jumped 35%, impacting investments in other instruments like the stock market, mutual funds and property. The government has said it would prefer savings to be invested in ``more productive assets'' that would help boost the growth rate.

Chirag Mehta, fund manager at Quantum Gold Fund however notes, ``Given the current economic backdrop, where governments are struggling with problems like rising deficits and unsustainable debts, it is indeed logical for gold prices to increase in value. With policy makers continuously debasing currencies, gold will be viewed as a preferred investment, lending some solace to investors.''

Schiff - Gold & The Perfect Storm That Will Lead To Collapse

Disinformation: How It Works

Monday, August 6, 2012

Libor May Be Manipulated, But Silver Is Not, CFTC To Conclude

Here is another take on the CFTC ending their investigation on the price manipulation of silver.


China media tell U.S. to "shut up" over South China Sea tensions

Reuters has British media roots, not American.

A Little Perspective on What Lies Ahead

Gold, Price Stability & Credit Bubbles
The Japanese example shows that crashed modern economies with excessive debt loads can remain stagnant for long periods of time. My view is that such nations are in a deleveraging trap; Japan (and more recently the Western nations) hit an excessive level of debt relative to GDP and industry at the peak of the bubble. As debt rises, debt servicing costs rise, leaving less income for investment, consumption, etc.

Throughout Japan’s lost decade, and indeed the years that followed, total debt levels (measured in GDP) have remained consistently high. Simply, the central bank did not devalue by anywhere near enough to decrease the real debt load, but nor have they devalued too little to result in a large-scale liquidation episode. They have just kept the economy in stasis, with enough liquidity to keep the debt serviceable, and not enough to really allow for severe reduction. The main change has been a transfer of debt from the private sector, to the public sector (a phenomenon which is also occurring in the United States and United Kingdom).

Eventually — because the costs of the deleveraging trap makes organically growth very difficult — the debt will either be forgiven, inflated or defaulted away. Endless rounds of tepid QE (which is debt additive, and so adds to the debt problem) just postpone that difficult decision. The deleveraging trap preserves the value of past debts at the cost of future growth.

Under the harsh discipline of a gold standard, such prevarication is not possible. Without the ability to inflate, overleveraged banks, individuals and governments would default on their debt. Income would rapidly fall, and economies would likely deflate and become severely depressed.

Yet liquidation is not all bad.

Although liquidation episodes are painful, the clear benefit is that a big crash and depression clears out old debt. Under the present regimes, the weight of old debt remains a burden to the economy.

The CEO Plan to Steal Your Social Security and Medicare

U.S. regulator set to drop silver probe: FT

What a surprise--the CFTC has decided to drop their investigation into silver manipulation in the futures market.  Never mind that they are in bed with the CME, the COMEX, and JPMorgan Chase.  Nothing to see here--move along folks.  All is well.  End sarcasm.

Sunday, August 5, 2012

This Is The Next Destructive Move By Central Planners

On The One Year Anniversary Of The US Downgrade
A year ago, the budget “deal” concocted between Mr Obama and his Congress was ballyhooing a “plan” to cut $US 1.2 TRILLION off annual budget deficits over a DECADE. Now, the projection for the 2012 budget is that the US government will add that amount to the funded debt of the US Treasury over ONE YEAR. This would be hilariously funny if it wasn’t so tragic. What is even funnier - and more tragic - is that the entire world is “depending” on the people who concoct this stuff.

On This Day In 2016

What Democracy?

Friday, August 3, 2012

Interview with a High-Frequency Trading Expert

This not news to investors who understand order flow (and invest in volatile stocks), but is an instructive read.  For example, I've warned readers on the dangers of telegraphing stop losses.  Yet, most brokers advise clients to do so, "in order to protect profits."  Nonsense--it only encourages market makers to scalp unsuspecting long investors from their holdings.

Also, it goes into some details on the dangers of market orders.

What's in your vault? Uncle Sam audits its stash of gold at the New York Fed

Gee, are us conspiracy theorist gold bugs supposed to breathe easier now?  The gold under the New York Fed and Ft. Knox may be there, but how times has each bar been re-hypothecated?  How many ounces of paper gold have been traded against physical inventory?

And the US Treasury is performing the audit?  I'm feeling warm and fuzzy already.  Investigative journalism at the LA Times = massive fail.,0,5461335,full.story