"Colossal Defeat" For Obama As Australia Joins China's Regional Bank

http://www.zerohedge.com/news/2015-03-16/colossal-defeat-obama-australia-joins-chinas-regional-bank

Australia’s Treasurer: Loose monetary policy has made the rich richer

http://www.sovereignman.com/trends/australias-treasurer-loose-monetary-policy-has-made-the-rich-richer-15475/

Australia Raises Debt-Ceiling to A$500bn to Avoid US-Like Crisis

Even Australia is joining the debt party.

http://www.ibtimes.co.uk/articles/516139/20131023/australia-debt-ceiling-shutdown-joe-hockey.htm

Australia Plans Cyprus-Style “Bail-In” Of Banks In 2013-14 Budget

Coming to all developed countries:  the government will confiscate your bank deposits to save banks from collapsing.

http://barnabyisright.com/2013/07/10/australia-plans-cyprus-style-bail-in-of-banks-in-2013-14-budget/

Down And Out In Down Under

http://www.zerohedge.com/news/2013-06-02/down-and-out-down-under

Westpac, ANZ secure deal to trade Australian dollar and Chinese Yuan

http://www.theaustralian.com.au/business/westpac-anz-secure-deal-to-trade-australian-dollar-and-chinese-yuan/story-e6frg8zx-1226614879328

Sorry, Mates, Strictly Business: Australia Wants To Cut Out US Dollar In Trade With China

Not only are US unfriendlies moving away from the USDollar, but so are America's allies.  They see what is going on with Fed monetary policies.  So should the American public.

http://www.ibtimes.com/sorry-mates-strictly-business-australia-wants-cut-out-us-dollar-trade-china-1161287

It's yuan for the money for Twiggy Forrest

There was Russia, Brazil, and now Australia.  China is forging bilateral trade agreements with these countries, bypassing the USDollar as the transactional currency in the process.   The days of the US petrodollar as the global reserve currency are numbered. 

http://www.theaustralian.com.au/business/mining-energy/its-yuan-for-the-money-for-twiggy-forrest/story-e6frg9df-1226093397794

Australian perspective on gold

http://www.moneymorning.com.au/20100329/china-buys-gold.html

It's instructive to roam outside the US to get a worldwide perspective on asset values. Australia's central bank just raised their interest rate for the fifth time in six months, in attempt to dampen inflation as their economy recovers. Nice problem to have, huh?

The Chinese are now the world's largest producer of gold, and the Chinese government is gobbling up available output--domestically and offshore, either via direct purchase or through investments in mining companies. Due to ramping up of their domestic production levels, their reserves will be kaput in 2016. Meanwhile, they are encouraging their citizens to consume gold, after repealing the ownership ban in 2001. Sure sounds like they are counting on their citizens to be the next source of gold when there's none left in the ground.

United Kingdom's fiscal troubles

The UK shares the same fiscal troubles as the United States: high deficits, huge debts, insolvency, high taxation, a low manufacturing base, high regulation, high unemployment, a deep recession, replacement of private sector debt with public debt, and bankrupt entitlement (social) programs.

Their government response has been equally similar: quantitative easing--or creation of money supply. And the results will be identical--a huge default--via inflation or outright default.

Here's an insightful Australian perspective on a British problem.

http://www.moneymorning.com.au/20091109/britain-death-economy.html

Central banks stepping up to the gold window

India's central bank purchase of 200 tons of IMF gold grabbed the biggest headlines, but central banks from other countries are also buying gold. More are inevitably considering increasing their gold reserves in diversifying away from the USDollar.

http://www.reuters.com/article/businessNews/idUSTRE5AF0CP20091116?pageNumber=1&virtualBrandChannel=0

China, now the world's largest gold producer, has been stealthily increasing its gold reserves, doubling its tonnage since 2003.

Of particular interest is this note in the article:

The Royal Bank of Australia has not bought any gold since selling two-thirds of its reserve in 1997.

Australia is a huge exporter of natural resources, including gold. It would not surprise me if they keep more of their output for domestic use going forward. Selling gold in the latest 90's was classic selling at the bottom, much like Great Britain's Gordon Brown did.

In an amusing sequence of press releases, the Russia State Depository announced they would sell 50 tons of gold on the open market. A day iater, the Russian central bank denounced the planned gold sale (in light of gold's rising prices). The day after that, the State Depository announced any gold sales would end up in Russia's central bank. One has to appreciate totalitarianism.

Net purchasing--instead of selling, by central bankers worldwide infers gold's surge in price won't end any time soon.

Good news, bad news...

The good news is that oil and fuel prices have backed down, as I predicted recently. Further good news indicates Americans are driving less, reducing our carbon emissions. The bad news is that the reduced tax revenue from fuel sales has left the federal and state governments even more cash-strapped.

Another gem I saw on the news is that our superhero Governor has mandated all non-emergency response state employees will now earn the minimum Federal wage of $6.55 an hour. That paycheck should really help pay the variable mortgage about to reset--not.

The US is a mess, and a recent trip by a friend to Australia illuminates the growing gap, as the land Down Under is experiencing a bull market in natural resources, fueled by booming economies in China and India. Australia is clean, modern, and their citizens are in good spirits, buoyed by a tourism boom as well. Kinda reminds me of us in the late 90's.

Meanwhile, China and India are aggressively securing energy and natural resources, acquiring equity stakes in suppliers, setting the stage for the US to be forced to buy at spot prices.

The Fed has to continue printing dollars in order to sustain an unsustainable balance of economic growth and fiscal responsibility. A money manager quipped that he senses the public believes we're in the late innings of this recovery, which is true--but not when you consider it's a 7-game World Series, not a one-game wonder. In other words, we should continue to have record foreclosures and bankruptcies for a couple more years before we turn this tanker around. The good news is that equity prices should rebound a year before the actual bottom, as the stock market is a forward discounting mechanism.

Another sign pointing to a recession...

This may be my most accurate economic indicator ever--traffic flow. If it takes an hour and a half to drive from Century City to Manhattan beach on the 405, we have full employment. On the other hand, if it takes 20 minutes, bet on a recession. That's assuming no highway drive-by shootings...

I also hear some homes in San Bernardino are going for 20 cents on the dollar, as long as you buy 100 of them at a time. That might seem too tempting to pass up--until you factor in that life expectancy in the Inland Empire is 10 years shorter than the beach areas.

The best deals around the country seem to be in high disaster areas. But then again, the reasons are self-explanatory.

My girlfriend is vacationing in Australia later this month. She got a good deal on the airfare and hotel, but I warned her that she may get sticker shock once she lands on resource-rich Down Under. The dollar is tanking, thanks to Bernanke's alleged life-respiratory reduction of the Fed rate. That's fine, until you figure out you just deposited your monthly rent into the fuel tank of your Chevy Suburban. The Aussies seem to be holding up well. Probably because China and India are buying up all their ore.

Actually, the US has strong exporters, too. Foreigners are eating up cameo appearances of Paris, Lindsey, and Britney on TMZ...

I have a feeling at some point down the line, I will have a rant about our priorities and our educational system. I'm proud of the fact that I have no idea who won the latest American idol (okay, that was a lie--I remember him now as I caught the finals--I just don't know his name). My girlfriend no longer forces me to watch it, just like I don't force her to watch Golf Channel anymore.