China approves gold fund of funds

http://www.marketwatch.com/story/china-approves-gold-fund-of-funds-2010-11-30

China’s securities regulators have given the go ahead for a mutual fund to invest in foreign exchange-traded gold funds, potentially tapping interest among mainland China investors who face negative real interest rates on their bank deposits and want to hedge against inflation.

The state-run China Daily said Tuesday that the new gold fund was the first of it its kind to be available to mainland investors. 

More funds could be on the way soon, as several other fund providers have pending applications for similar products, seeking to tap rising interest among mainland Chinese investors for precious metals, the report said.

An I.M.F. Announcement On The Completion of Gold Sales Due Soon

http://www.safehaven.com/article/19141/an-imf-announcement-on-the-completion-of-gold-sales-due-soon

Banks Resisting Fannie, Freddie Demands to Buy Back Mortgages

It's Goliath vs. Goliath, and it won't end well.  In one corner is Freddie Mac and Fannie Mae.  In the other corner are banks, big and small, refusing to take back bad loan portfolios.

http://www.bloomberg.com/news/2010-11-30/banks-in-u-s-resisting-calls-to-repurchase-fannie-mae-freddie-mac-loans.html

Fannie Mae and Freddie Mac are facing growing resistance as they attempt to push failed home loans off their books and onto the balance sheets of banks including Bank of America Corp. and JPMorgan Chase & Co.

The two government-owned mortgage companies are enforcing contracts that require lenders to buy back loans that didn’t meet underwriting standards. At the end of September, the companies reported, banks hadn’t responded to $13 billion in buyback requests. A third of those were at least four months old and Freddie Mac has begun to assess penalties for the delays.

The gold standard never dies

http://mises.org/daily/4846

Contagion strikes Italy as Ireland bail-out fails to calm markets

In case you've been in a deep slumber for a year, you'd know that Greece and Ireland have defaulted on their sovereign debt and received bailouts from the European Central Bank and International Monetary Fund, the world's central bank.  You'd also know that the bond vigilantes have Portugal and Spain in their crosshairs.

What's less known is Italy and Belgium are also teetering on the brink of a sovereign debt crisis of their own.  For forward thinkers, look at France and Germany itself.  The ECB and IMF are running out of life boats.

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8169225/Contagion-strikes-Italy-as-Ireland-bail-out-fails-to-calm-markets.html

Europe's debt domino effect

WikiLeaks Will Unveil Major Bank Scandal

I wonder if the bookies are taking odds on which major bank will be unveiled by WikiLeaks in the next major financial scandal.

http://blogs.forbes.com/andygreenberg/2010/11/29/exclusive-wikileaks-will-unveil-major-bank-scandal/

Sean Boyd: gold headed to $2000, silver to $60 to $75

Sure, Sean Boyd is admittedly talking his book, as he is the CEO of Agnico Eagle, a gold producer.  But he has been right for more than a decade, and Agnico has a $13 billion market capitalization.  You might want to sit up and take notice.

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/11/29_Sean_Boyd_-_Gold_Headed_to_%242%2C000%2C_Silver_%2460_to_%2475.html

Putin ditches the dollar, backs the euro and Germany

http://www.youtube.com/watch?v=IvJEJEGzeU8&feature=player_embedded

Peter Schiff: Ireland should default

http://www.youtube.com/watch?v=kgOovAcsLA8&feature=player_embedded

EU rescue costs start to threaten Germany itself

http://www.telegraph.co.uk/finance/financetopics/financialcrisis/8160999/EU-rescue-costs-start-to-threaten-Germany-itself.html

The escalating debt crisis on the eurozone periphery is starting to contaminate the creditworthiness of Germany and the core states of monetary union.

"Germany cannot keep paying for bail-outs without going bankrupt itself," said Professor Wilhelm Hankel, of Frankfurt University. "This is frightening people. You cannot find a bank safe deposit box in Germany because every single one has already been taken and stuffed with gold and silver. It is like an underground Switzerland within our borders. People have terrible memories of 1948 and 1923 when they lost their savings."

The refrain was picked up this week by German finance minister Wolfgang Schäuble. "We're not swimming in money, we're drowning in debts," he told the Bundestag.

Fake "bogeyman" and artificial "security"

http://www.zerohedge.com/article/fake-bogeymen-and-artificial-security

Lies across America

http://www.theburningplatform.com/?p=7783

Putin: Russia will join the euro one day

http://www.telegraph.co.uk/finance/currency/8163347/Putin-Russia-will-join-the-euro-one-day.html

State's secrets

http://www.nytimes.com/2010/11/29/world/29cables.html?_r=3&pagewanted=all

Ireland bailout: fears mount that eurozone fund is too small

It's hypocritical for European finance ministers to  bash the Fed for applying quantitative easing several weeks ago, and then turn around and announce bailouts of Ireland, with Portugal and Spain waiting in the wings.  Printing money is printing money, and central banks from both sides of the Atlantic will do whatever it takes to save their respective economies from collapsing.

http://www.guardian.co.uk/business/2010/nov/25/eu-ireland-bailout-fund-increase

Asking China to Act Like the U.S.

Thanks to Kitty for finding this editorial on Sino-American foreign policy.

http://www.nytimes.com/2010/11/28/weekinreview/28cooper.html?pagewanted=1&_r=1&ref=world

The Rules Of The "Multi-Trillion Shell Game" And What To Expect Next

http://www.zerohedge.com/article/sean-corrigan-explains-rules-multi-trillion-shell-game-and-what-expect-next

"under the rules of this multi-trillion shell game, the sovereigns guarantee the ECB which funds the banks which buy the government debt which provides for everyone else's guarantees."

"...The latest move to contain excess liquidity and the forceful measures that the central government has taken to stabilize prices show the determination of Chinese policymakers to fight inflation. Though these moves may not be enough to tame inflation once and for all, they are a good start before more aggressive actions become necessary to battle inflation that is unlikely to end anytime soon, as debt-laden rich countries keep flooding the world economy with their newly printed money."

While the developed world continues to inflate with quantitative easing, the emerging world will apply quantitative tightening to ease inflationary pressures.  This may cause a temporary pause in rising prices of commodities, including precious metals.

With 'Synthetic Banking' Just Around the Corner Enjoy 'The Liechtensteiner' on 'Fed Monday'

The mad scientists are venturing back out into the deep end of the pool, having learned nothing from overleveraged derivatives gone wild.  As one commentator stated, "this will end very badly."

http://www.zerohedge.com/article/guest-post-synthetic-banking-just-around-corner-enjoy-liechtensteiner-fed-monday

...there are no 'traders' at all, just 'synthetic traders' immersed in 'continuous risk management' with no 'exchange trading' or 'position management' costs or risks. Employing 'commercially prudent leverage' within 'continuous risk management',...

Where have we heard this before?  Whoever buys these structured financial vehicles has got to the dumbest nitwit of the 3rd order--or possesses a PhD in Economics from Princeton.

ECB's Weber Says Europe's Rescue Fund Could Be Increased If More Needed

As Jim Sinclair points out repeatedly, expect QE to infinity in the Euro zone and here in the States.

http://www.bloomberg.com/news/2010-11-25/europe-s-1-trillion-stability-fund-may-need-to-be-increased-weber-says.html

European Central Bank council member Axel Weber said governments can increase the size of the European Union-led bailout fund if necessary to restore confidence in the euro.

“Seven hundred and fifty billion should be enough to assure the markets,” Weber said at the German embassy in Paris late yesterday. “If not, it will have to be increased.”

Russia buys Canadian dollars, may add Australian dollar

http://www.marketwatch.com/story/russia-buys-canadian-dollar-may-add-aussie-dollar-2010-11-25

Russia has reportedly added the Canadian dollar to the basket of currencies that comprise its international foreign-exchange reserves and indicated the Australian dollar will likely be the next addition.

Ulyukayev reportedly said Russia plans to increase the size of its Canadian dollar holdings in coming months as part of changes to its reserve holdings, also made up of the U.S. dollars, euros, British pounds, and Japanese yen. 

Ulyukayev also said the Russia central bank is still considering whether it should add the Australia dollar to its reserves’ holding, reaffirming statements earlier this year that it may add the commodity-backed currency as it diversifies away from the U.S. dollar.

Hungary Follows Argentina in Pension-Fund Ultimatum, `Nightmare' for Some

This is a real live example of what happens when underfunded pensions become nationalized.  This article also depicts other eastern EU countries' state pension funds are severely underfunded.

http://www.bloomberg.com/news/2010-11-25/hungary-follows-argentina-in-pension-fund-ultimatum-nightmare-for-some.html

Hungary is giving its citizens an ultimatum: move your private-pension fund assets to the state or lose your state pension.

The Euro game is up!

And apparently, so will the financial games of the rest of the developed world.



http://www.youtube.com/watch?v=Fyq7WRr_GPg&feature=player_embedded

How hedge funds have profitted from QE

With the Fed and the Euro Central Bank applying QE, excess liquidity has to flow somewhere, and that somewhere is emerging countries with strong economies, sound currencies and trade surpluses.  This capital flow is causing price inflation, forcing countries like Brazil and China to impose price controls, which always ultimately fail.   But they have to do something to choke off the hot money.

Meanwhile, the savvy hedge fund managers (even the ones looking over their shoulders at the FBI) are buying emerging market equities and commodities, and plowing their profits into buying credit default swaps on European debt, profiting on sovereign debt crises in Greece, Ireland, Portugal, and Spain.  As the prospects for sovereign debt default increases, the CDS insuring said default appreciates in value.  In other words, these bond speculators are betting on these countries defaulting on their debt obligations.

These so-called bond vigilantes have no conscience:  when they smell blood, they drive up yields on these sovereign bonds, making it harder for these countries to service their debts, and practically ensuring a default.  Of course, the respective government officials will blame the speculators for driving their countries into the ground, but they conveniently ignore the fact that it was the government that recklessly spent money they didn't have, and hence, attracted the bond vultures in the first place.

The problem intensifies when the debt contagion spreads to Italy, France, and eventually Germany, the last stronghold in the Euro community.  The UK, Japan, and the US will not be far behind.

The day the dollar died

http://www.youtube.com/watch?v=2N8gJSMoOJc&feature=player_embedded