Thursday, November 29, 2012

Hong Kong Parking Costs $387,000 as Cash Moves From Homes

It it looks like a bubble, smells like a bubble, sounds like a bubble, then...quack.

Borrowing costs in Hong Kong are almost at record lows because the Hong Kong dollar’s peg to the U.S. currency ties monetary policy to the Federal Reserve’s even as the economy is driven by China’s growth.

Global Gold Mines and Deposits Ranking 2012

Best Performing Russell 3000 Stocks YTD

Jean-Claude Juncker quotes

When it becomes serious, you have to lie.” - Jean-Claude Juncker, President of the Eurogroup

"We all know what to do, we just don't know how to get re-elected after we have done it." - Jean-Claude Juncker, President of the Eurogroup

Two-thirds of millionaires left Britain to avoid 50p tax rate

If it works in the United Kingdom, it should work in the good ol' USA?

Almost two-thirds of the country’s million-pound earners disappeared from Britain after the introduction of the 50p top rate of tax, figures have disclosed.

In the 2009-10 tax year, more than 16,000 people declared an annual income of more than £1 million to HM Revenue and Customs.

This number fell to just 6,000 after Gordon Brown introduced the new 50p top rate of income tax shortly before the last general election.

The figures have been seized upon by the Conservatives to claim that increasing the highest rate of tax actually led to a loss in revenues for the Government.

It is believed that rich Britons moved abroad or took steps to avoid paying the new levy by reducing their taxable incomes.

Salma Hayek

Presidential Memorandum, 11-21-12

“Often the best source of information about waste, fraud, and abuse in government is an existing government employee committed to public integrity and willing to speak out. Such acts of courage and patriotism, which can sometimes save lives and often save taxpayer dollars, should be encouraged rather than stifled as they have been during the Bush administration. We need to empower federal employees as watchdogs of wrongdoing and partners in performance. Barack Obama will strengthen whistle-blower laws to protect federal workers who expose waste, fraud and abuse of authority in government.” -- Obama campaign's Document for Change, 2008
SUBJECT: National Insider Threat Policy and Minimum Standards for Executive Branch Insider Threat Programs

This Presidential Memorandum transmits the National Insider Threat Policy and Minimum Standards for Executive Branch Insider Threat Programs (Minimum Standards) to provide direction and guidance to promote the development of effective insider threat programs within departments and agencies to deter, detect, and mitigate actions by employees who may represent a threat to national security. These threats encompass potential espionage, violent acts against the Government or the Nation, and unauthorized disclosure of classified information, including the vast amounts of classified data available on interconnected United States Government computer networks and systems.

The Minimum Standards provide departments and agencies with the minimum elements necessary to establish effective insider threat programs. These elements include the capability to gather, integrate, and centrally analyze and respond to key threat-related information; monitor employee use of classified networks; provide the workforce with insider threat awareness training; and protect the civil liberties and privacy of all personnel.

The resulting insider threat capabilities will strengthen the protection of classified information across the executive branch and reinforce our defenses against both adversaries and insiders who misuse their access and endanger our national security.


Matt Taibbi: Election Jamie Dimon To Be Treasury Secretary Would Be 'Revolution-Provoking Decision'

Thanks to Kitty for finding this one.

Raspberry Ketones review | Watch This Review Before You Buy Raspberry Ketones

Wednesday, November 28, 2012

Senate works on new package of Iran sanctions

The package seeks to ban financial transactions with any person or organization blacklisted for their association with the Iranian government, as well as sales of metallurgical coal and precious metals, a congressional aide said, speaking on condition of anonymity.

The sanctions would end "Turkey's game of gold for natural gas," a senior Senate aide said, referring to reports that Turkey has been paying for natural gas with gold due to sanctions rules.

The legislation "would bring economic sanctions on Iran near de facto trade embargo levels with the hope of speeding up the date by which Iran's economy will collapse," the aide said.

How Do the Chinese View the Gold Market?

The Cost of Kidding Yourself

Calpers triggers legal fight with bankrupt San Bernardino over pension debt

Good luck with that.  CalPERS is suing a bankrupt San Bernardino to recoup millions in halted pension payments.  Um, San Bernardino filed for bankruptcy--they're broke, but I'm sure Wall Street bankers will try to squeeze blood from a turnip.

Y Combinator reducing investments to $80K per startup, but including regular office hours from VCs

The article below is more evidence that the Web 2.0 bubble is bursting.  The first sign of a bubble was the production of the reality TV show:  Start-ups: Silicon Valley.  The second sign is the show is a bust.  Disclaimer:  I have never watched the show, nor do I ever plan to watch it.  So I have no idea if it becomes a game-changer like the Survivor series.  /double sarcasm  Why the double?  Because I think reality TV is a snoozer with no redeeming qualities.  Yet, I understand it's every producer's dream to drum up the next Survivor.

As someone who's been around since the late 1990's, I've seen this rodeo before.

As a fan of technology, and one who participated and even profited from it, I believe in the value of creative, disruptive innovation.  But history also shows the trajectory of that curve includes road kill littered in its path.  For instance, at the turn of the 20th century, there were thousands of American car companies--it was cutting edge technology then.  Today, there are 3--barely, and only after two of them needed bailouts in 2008.  But we needed that boom in cars--otherwise, we'd still be riding horses today.  It's analogous to the Dutch tulip mania of 1637, which was a bubble of immense proportions, but spawned the world's greatest flower market in Amsterdam.

So tech giants like Google, Apple, Paypal,, Oracle, Microsoft, and yes, even Facebook will survive and thrive.  A few more mid-tier companies and upstarts will kick down the doors, and fill out the infrastructure.  And dreamers will always point to these successes as guideposts to justify their dreams.  Good for them--we need dreamers.  But we also need those who successfully implement those dreams.

The "reality" is: most startups will be lab experiments gone wrong, and that's not necessarily a bad thing.  Those failures will fuel the next set of dreams.  You need the parasites to keep the eco-structure vibrant.  A cacophony of failures is necessary to subsidize the rare winners.  But as an investor, I'm passing.  Yes, that's cold and calculating on my part.  It's a splash of water in the face--a "taking away of the punch bowl."  But it's also a sober assessment, and that's the reality show in my world.

Creative destruction, bitchez!

We’re All Currency Manipulators Now

Tuesday, November 27, 2012

The Mousetrap

Read the first 21 pages, titled The Mousetrap, and how to keep a conspiracy secret.

Pennsylvania Department of Welfare: Lost Decade

Click on Image to Enlarge

Is JPMorgan About To Take Over America, Again?

When Work Is Punished: The Tragedy Of America's Welfare State

The Scariest Chart Of The Quarter: Student Debt Bubble Officially Pops As 90+ Day Delinquency Rate Goes Parabolic

CME Declares Force Majeure at Manhattan Gold Depository

Where there is smoke, there is fire.  Paper certificates may be irreparably damaged by flooding, but gold bars are indestructible by water--or even fire (i.e., it is merely melted down).  Hurricane Sandy is providing a convenient scapegoat for those whose vaults are empty, and a declaration of force majeure is the ultimate cover, SOMETHING WE HAVE PREDICTED MANY TIMES.

This is the language centered around a force majeure to provide cover for the CME:

In a notice to customers on Monday, CME declared force majeure, a contract clause that frees parties from liability due to an event outside of their control, for the facility.

In a notice to customers on Monday, CME declared force majeure, a contract clause that frees parties from liability due to an event outside of their control, for the facility.

Folks, the time has cometh.  The shortage in physical gold (and silver) is now forcing depositories to short-deliver physical inventory, as it just doesn't exist.  People who believe they have legal claim to physical inventory only own a paper certificate, with physical delivery another proposition.  The CME's vaults are half empty, so they have had to resort to blaming Mother Nature, covering up the fact that the emperor has no clothes (gold).  The masses have been hoodwinked--again.


Turk - Gold Shortage Forcing Drastic Steps By Central Planners

Leeb - Gold, Silver & Natural Gas Are Going To Soar

Like Leeb, I'm bullish on fracking natural gas also.  But extraction output and life cycles of fracking drills will be proven to be far too much optimistic due to high depletion rates--at current natural gas prices.  Which means capital expenditures will soar to continue current production rates.  Higher natural gas prices will be needed to make fracking economic.

As for prices of gold and silver, readers should already know where we stand on that.

Turk - The LBMA Is Moving To Cover Up Silver Manipulation

Readers need to differentiate between a contango and backwardation in silver futures prices to better understand this article by James Turk.  It applies to the gold market and crude oil occasionally as well.  Use the search function in this blog--I've entered a few entries on this topic.  To help you, here's the link.

Ex-Olympus CEO: Japan Is Dysfunctional

This is why I wouldn't invest a dime in Japan, Inc.

ACADIA Announces Pimavanserin Meets Primary and Key Secondary Endpoints in Pivotal Phase III Parkinson's Disease Psychosis Trial

Shares of ACAD are surging this morning.  Here's why:

A Manipulation Timeline

Sunday, November 25, 2012

Black Friday, Fiscal Cliff, Gold, Dollar

Peter Schiff is self-promotional and abrasive to his critics, but he's also insightful--and usually accurate with his forecasts.

Documents: Leaked Industry E-Mails and Reports

This is more evidence from geologists who are dampening expectations for shale.  Yes, I do believe we should pursue this and other alternative energy resources--including renewables, but due to more efficient extraction (i.e., horizontal drilling), the life cycles of oil and natural gas fields are much shorter in duration than what the hopium describes.  Peak oil subscribes to the theory that we will not run out of oil--rather, we will run out of easy-to-reach, and cheap oil.

While this "bubble" in shale will end in tears, it is the investments in the technology that will be end up being a disaster.  Prices will remain elevated as long as these forecasts for production remain overly optimistic.

Saturday, November 24, 2012

Rosen - This Move In Gold & Silver Is Going To Shock People

Even if You Hate Gold, You Should Buy It

Rick Rule: Be a Risk Manager, Not a Reward Chaser

I had the pleasure of listening in on two of Rick Rule's presentations at the Hard Assets Investment Conference in San Francisco earlier this month.  I also was able to chat with him on a couple occasions at Sprott's booth.  We had some slight disagreements on the bullion banks' price suppression schemes, but his insight is stunningly acute.  This is a must-read for investors in the mining sector.

The Soros Position Nobody is Talking About

Puppet State America

Friday, November 23, 2012

Jeff Nielson: Silver's smoking guns of price suppression

This is brilliant analysis by Jeff Nielson on price suppression of silver.

Silver’s Smoking Guns, Part I: Mining Paradox

Silver’s Smoking Guns, Part II: Investment Paradox

Silver’s Smoking Guns, Part III: Market Paradox


Silver: Shorting Consumes, Investing Conserves

Man Pulls Gun on Rowdy, Line-Cutting Black Friday Shopper

Call to bring Austrian gold back home from the UK

The uneasiness of storing sovereign gold reserves in foreign vaults is spreading globally.  Repatriation of said gold reserves is the next step in alleviating those concerns.  Counterparty risk is real, and rampant re-hypothecation will become exposed, in my opinion.  In other words, the gold stored in London and New York that everybody thinks they own ain't there.

Austria is the latest country to raise questions on the viability of storing their gold offshore.  In fact, the existence of the gold is coming into question.  I've predicted this for years, and now trust in the gold custodial system itself is crumbling.

Who Should Be Giving Thanks This Thanksgiving?

$29 Trillion

Banking system, governments, people--in that order

Some Thanksgiving humor.  Enjoy the turkey leftovers.

Click on Image to Enlarge.

Wednesday, November 21, 2012

Guest Post: Price Suppression Mechanics of GLD and SLV, by Andrew Maguire

Brazil Boosts Gold Reserves to the Highest in More Than 11 Years

Human Freedom Rests on Gold Redeemable Mone

Warren Buffett may ridicule gold as a worthless asset, but his father certainly believed otherwise.

With Deloitte Humiliated, A Quick Look At Its Other, Best Known Client

The Final Round In The Fed's Arsenal
Click on Image to Enlarge

Tell me again… which of these nations is communist?

Kyle Bass Interview

Tuesday, November 20, 2012

Senate bill rewrite lets feds read your e-mail without warrants

Former SAC Trader Busted With Biggest Insider Trading Profit In History

Here is zero hedge's take on the latest allegations of insider trading by one of SAC's tentacle hedge funds.

Cohen linked to $276m insider trading scheme

Anybody who has invested in the biotech battleground stock Dendreon knows there are dark forces behind Wall Street's manipulation of markets.  Or anybody who has read "Deep Capture" understands this also.  I have done both--back in 2009.  There are many other cases--not just these two alleged cases of insider trading.  The SEC, FBI, and DOJ:  better late than never.

SEC Rocked By Lurid Sex-and-Corruption Lawsuit

Monday, November 19, 2012

Canadian Dollar Gains as IMF Considers Reserve Status

The Canadian dollar and Australian dollar are also gaining clout as international currencies.

Asian economies turn to yuan

We Are Speeding Towards Economic & Social Devastation

Some personal thoughts on surviving the monetary meltdown

Women Prefer Men Holding State Bonds, Japan Ad Says

This is undoubtedly a sign that Japan is on its last legs.  The desperation is that tangible.
“It strikes of desperation,” Christian Carrillo, a senior interest-rate strategist in Tokyo at Societe Generale SA said about the ad campaign. “I doubt this will be a successful strategy to attract retail investors.”

More lies about your taxes…

Treasury Secretary Geithner: Lift Debt Limit to Infinity

Insanity within the US Treasury is now a fixture.  God help us all.

Shale Gas Will be the Next Bubble to Pop - An Interview with Arthur Berman

The world won't run out of oil; we will run out of cheap--and easy-to-extract oil.  The natural gas required to extract oil can get prohibitive.  Technological breakthroughs will produce more efficient extraction (e.g., horizontal drilling), and cause the depletion rate of these resources is occur much faster than conventional oil.  In other words, the US won't be energy independent any time soon, despite campaign promises to the contrary.

Shortages will occur around the world, as the war for capturing natural resources intensifies, led by China.  The economies of importers such as Japan and most of the European zone will be crushed due to rising prices.

And of course, if war breaks out in the middle east, then all bets are off.

Sunday, November 18, 2012

The Central Bankers' Potemkin Village

This is a brilliant take by Kyle Bass.

Click on Image to Enlarge

US gold reserves and US Treasury debt owned by foreigners

This is a table of US Federal debt held by foreign investors.  It aggregates the amount of US Treasury debt owned by foreigners.  As of April 1, 2012, foreign investors hold $5,292,300,000,000 of US Treasury debt.

As of October 31, 2012, the US Treasury has 261,498,926.247 troy ounces (8133.5 metric tons) of gold in its vaults.

Using first grade arithmetic, and dividing the first number by the latter number, we calculate that each ounce of gold backs $20,238.32 of US Treasury debt owned by foreign bond holders.  As of November 16, 2012, the spot price of gold is $1713.70 per troy ounce.

These numbers should understandably concern foreign holders of US Treasury bonds.  And it also explains why they are accumulating gold as far as they can.  See China.

Keiser Report: 'Crash JP Morgan' - 2nd Anniversary Special

Money is far too important to be left to the politicians
As this monetary system fights a hard fight to its bitter end, governments are working harder than ever to stop individuals choosing how to store their money. Whilst here in the West we seem blinkered by the monopoly money governments woo us with, our compatriots elsewhere are onto something; saving vociferously in gold, aware that their governments are proving poor stewards of the monetary system. But in many cases, if not all, the government is putting up a fight.

Whilst governments and loyal Bernanke followers out there continue to tell us that ‘gold is not money’ their actions continue to prove them wrong.

Clamping down on the use of gold in both the banking system and the marketplace is yet another attempt by government to prove their money is the best money…but they need to control gold in order to prove it.

Saturday, November 17, 2012

My Observations at the 2012 Hard Assets Investment Conference in San Francisco

Attending the Hard Assets Investment Conference in San Francisco has been fruitful, if not eye-opening.  After all, it's gold bugs preaching to the choir.  Here's the agenda and list of speakers:

Attendance is down from 2010, which is a good thing, according to Rick Rule, as bear markets beget bull markets, so the take down in mining shares should be viewed as a buying opportunity.

Most mining shares have severely underperformed the actual physical spot prices, and most presenters forecasted that the mining shares should provide positive leverage in a market of rising prices for precious metals.  Paul van Eeden, a long-time gold bug, was bearish, as he believes inflationary expectations have exceeded reality.  He has his own money supply metric, and he educated the audience on the difference between the exploding monetary base (thanks to the Fed) and money supply figures, which have stagnated as banks are not lending.  Many in the audience didn't know the difference, which is troubling, but understandable, I guess.  This is presumably one of the more informed crowds on hard currencies, and yet, they didn't understand basic central bank policy actions, and couldn't differentiate the indirect relationship between the monetary base and money supply.

Long story short, banks are hoarding reserves (and earning a guaranteed return, by the way) in reaction to the 2008 liquidity crisis.  Folks are understandably nervous, and the hoarding of cash checks money velocity--and its accompanying multiplier effect.  That's why van Eeden believes money supply growth is steady, and not flat (hence, the need for QE 3 was more for influencing market expectations), but not soaring, either.  His investment thesis is moderate inflation is bearish for gold, as inflationary expectations have soared beyond reality.

He was cornered by worried gold bulls after his presentation and some lively discussion occurred.  I honestly believe most of what he posited, but I diverge from his viewpoint contextually--we may not have high inflation now, but the monetary base represents the POTENTIAL for runaway inflation later.  In other words, the coals are in the barbecue grill, and only fuel needs to be added to the fire.  What is now mild inflation can turn to high inflation if input and labor costs rise, which becomes a self-fulfilling spiral of higher inflationary expectations.  This fuel could come in the form of any black swan event, whether it's a physical shortage of some commodity, war breaking out in the middle east, labor strikes demanding higher wages in the face of higher consumer prices, etc.  We don't know what we don't know...

Those who follow Jim Sinclair would also disagree with van Eeden, as Sinclair is a leading proponent of currency induced cost push inflation.  Both Sinclair and van Eeden correctly called the bottom in precious metals after the turn of the century, so it will be interesting to see who will end up correct--again.  My bet is on Sinclair, as his track record is longer, and he's been bullish on gold since the 70's after President Nixon closed the gold window in August, 1971.  Ron Paul, anyone?

Rick Rule gave his usual outstanding bullish case for gold, and even more so for mining shares which have been beaten down mercilessly.  His speech essentially made the case that bear markets are merely buying opportunities for buyers who like hunting for bargains.  I talked with him after his speech also, and I queried him about his partner Eric Sprott's position on the price suppression of paper gold and silver.  Rick, being a former Goldman Sachs employee, downplayed the effectiveness of naked shorting long-term.  I somewhat agreed, but we also agree that short-term, it is quite effective.  I'm more of a conspiracy theorist than he is, as I have seen collusive bear raids on biotech upstarts, so naked shorting is alive and well in equities--and in the futures pits.  Being an investor in battleground biotech stocks has given me insight on the abuse of the "Madoff exemption", which basically accords broker-dealers (market makers) the ability to create unlimited phantom shares for "liquidity" purposes.  My viewpoint is it allows them to get their friends out of trouble when the naked short goes horribly wrong.  It can buy the shorts time to cover at more favorable prices, as shares tank as a result of a bear raid.

Rick's point is that market makers may be friendly rivals, but they have a general distrust of each other.  So the collusion would break down and counterparties would call in their chips (fails to deliver) sooner rather than later.  My observations are that many hedge funds have a network of co-conspirators, which enable them to execute these bear raids synchronously.  The infamous bear raid warning of Dendreon shares is living proof--I saw that post on the Yahoo message board minutes before hundreds of millions of dollars of equity disappeared within 30 seconds.  I thank my stars (and intellect) I didn't have a stop loss put in, because all that equity loss reversed itself the next morning when trading resumed.  Many unsuspecting investors lost millions that day, having been sold out at the bottom due to their stop-loss market orders.  For those who don't recall, I explained very early on the difference between a stop-loss (market) order and a stop-loss limit order.  With a stop-loss order, there are two trigger points, and those who didn't know the difference, lost thousands or even millions.

In any case, Rick also implored that having tons of gold in the ground is not a great indicator of value because time is money.  It takes resources (permitting, water, energy, labor) and the WILL of miners to extract said gold.  And as the go/no-go decision keeps getting delayed, the value of your bet decays.  As long as the price of gold is too low to make digging it up uneconomic, investors are sitting on dead money.  That bit of advice was worth hearing, because I listened to a few companies who made compelling cases that they were literally sitting on a gold mine.  However, as I learned through Rick, getting it out of the ground feasibly is a different proposition.  The obvious solution is a higher gold prices converts formerly uneconomic mines, economic.  I should learn more at some of this morning's working sessions.  Stay tuned.

Friday, November 16, 2012

Twinkies, Ding Dongs Maker Hostess Liquidates Following Failure To Resolve Labor Union Animosity

Unions won the battle--and lost the war.  Next stop for 18,000 workers:  the unemployment line.

House Republicans Find Corzine Guilty Of MF Global Collapse, Missing Funds; Democrats Refuse To Endorse Findings

The Hypocrite Of The Day Award Goes To...
While we largely enjoy Dallas Fed's Dick Fisher hawkish, non-conformist thinking at the FOMC, and his willingness to come up with amusing cartoon names to explain the Fed's monetary policy (we are currently on Toy Story, and specifically Buzz "To Infinity and Beyond" Lighyear), we certainly do not miss when even said faux Fed bad cops telegraph hypocrisy so gruesome it shows demonstrates beyond a shadow of a doubt just how fake the facade of the Fed's "contrarians" truly is. To wit:
Riddle us this, Dick: just who is it that enables the US Lawmakers to fund trillion dollar deficits year after year at less than prohibitive terms, and more importantly, who is it that since 2009 has monetized virtually all 10 Year and longer gross issuance, thereby allow Congress to be a parasitic wastrel. Would you call that someone a "Wastrel enabler"?
Do you know who that someone is, Dick? Or is the question too complicated for a mere PhD mortal to answer?

Guess What They Are Not Cutting In The Fiscal Cliff...
As we've discussed before, US government spending falls into three categories.
  1. Discretionary spending is what we normally think of as 'government.' It funds everything from the military to Homeland Security to the national parks.
  2. Mandatory spending covers all the major entitlement programs like Social Security and Medicare.
  3. Then there's interest on the debt, which is so large they had to make it a special category.
The latter two categories are spent automatically, just like your mortgage payment that gets sucked out of the bank account before you have a chance to spend it. The only thing Congress has a say over is Discretionary Spending. Hence the name.

But here's the problem-- the US fiscal situation is so untenable that the government fails to collect enough tax revenue to cover mandatory spending and debt interest. In Fiscal Year 2011, for example, the US government spent $176 billion MORE on debt interest and mandatory spending than they generated in tax revenue. 

In Fiscal Year 2012, which just ended 6 weeks ago, that shortfall increased to $251 billion. This means that they could cut the ENTIRE discretionary budget and still be in the hole by $251 billion. 

This is why the Fiscal Cliff is irrelevant. The automatic cuts that are going to take place don't even begin to address the actual problem; they're cutting $110 billion from the discretionary budget... yet only $16.9 billion from the mandatory budget. 

Given that the entire problem is with mandatory spending, slashing the discretionary budget is pointless. It's as if the US economy is a speeding train heading towards a ravine at 200 mph, and the conductors are arguing about whether they should slow down to 150 or 175.

Oh, and there's just one more problem.

The government thinks that they will collect a few hundred billion dollars more in tax revenue when all of these new taxes kick in. Again, wishful thinking.

In the six+ decades since the end of World War II, tax rates in the US have been all over the board. Yet during this time, the US government has only managed to collect roughly 17.7% of GDP in tax revenue.

Conclusion? Increasing taxes won't increase their total tax revenue. Politicians have tried this for decades. It doesn't work. The only way to increase tax revenue is for the economy to grow... and higher tax rates do not pave this path to prosperity. 

Ron Paul was spot on. Economic ignorance abounds. And all the Talking Heads in the mainstream media blathering away about the Fiscal Cliff are only reinforcing his premise. 

Bottom line-- the Fiscal Cliff doesn't matter. The US passed the point of no return a long time ago.

Why Politicians Hate Austerity - In One Simple Chart
Austerity doesn't get you re-elected.

Our Malinvestment In President Obama Will Bring Painful Consequences
The danger here, as we have seen in every other bust for a century or more, is that we can only suspend the laws of economics for so long. And in general we are only good at considering immediate consequences, while being very, very bad at considering later consequences. As 19th century French economist Frédéric Bastiat observed, “The bad economist pursues a small present good, which will be followed by a great evil to come, while the true economist pursues a great good to come, at the risk of a small present evil.”


U2′s Bono Warns Fiscal Cliff Cuts Will Hurt World’s Poor

I'm glad Bono cares, but the poor will suffer no matter what Congress does.  Our debt problems are unsolvable and irreversible.  The financial elites will only pile on more debt by creating more currency, in futile attempts to stimulate sagging economies.  A global debt repudiation will render billions of people to starve.

Thursday, November 15, 2012

Expect more from the Fed — and soon

Japan's Likely Next PM Calls on BOJ to Print Unlimited Yen

This announcement by the Japan's next Prime Minister is extremely bullish for gold.  Yet, shares of gold miners tanked.  Who do you think will be buying at the bottom?

Agency MBS Historical Operational Results and Planned Purchase Amounts

As ghastly high as the Fed's plans are to purchase mortgage-backed securities as part of QE, the actual purchases are twice as high. Don't believe me?  Check the New York Fed's own data:

The problem with unlimited QE and Operation Twist is eventually, there isn't enough debt for the Fed to purchase--they will have run out of things to buy.  Then what?  Well, print more, of course...

Soros Adds to Gold Miner ETF Positions, Raises GLD Stake

George Soros is the same billionaire who declared gold as the ultimate bubble asset a few years ago.  Yet, he keeps accumulating.  Head fake, anyone?  Buy low, right?

Anti-austerity marches turn violent across southern Europe

FERC Suspends JPMorgan Unit’s Power-Trading Authority

JPMorgan is allegedly manipulating markets?  Say it ain't so...

U.S. Postal Service Reports Record Loss

Transcript of Ron Paul's Farewell Address

Ron Paul: Secession Is an American Principle

Wednesday, November 14, 2012

Ron Paul Departs With ‘Our Constitution Has Failed’

Ron Paul will go down as one of our greatest legislators of all-time.

Turkey Pushes For Gold & Global Gold Production To Plummet

I’m Uncle Sam, and I’m a Debt-aholic

Lawmaker asks to be paid in gold

Thanks to Dick for finding this.

Dollar no longer primary oil currency as China begins to sell oil using Yuan

I've warned of this day coming many times, and despite complete neglect by the US media, this is probably THE biggest event in decades affecting the welfare and standard of living for all Americans. The USDollar is about to lose its global reserve currency status, as the "petrodollar" is no longer the international trade settlement currency.  Countries will no longer need USDollars in cross-border (oil) transactions.  This will have negative ramifications for the strength of the dollar--as well as reduced demand for US Treasury bonds.  Sinking bond prices = rising bond yields = rising interest rates = US government bankruptcy.

Expect our purchasing power to plummet, i.e. rising consumer prices despite stagnant and declining incomes.  A sinking economy will also mean social unrest.  See southern Europe.

Nigel Farage - This Is My Single Greatest Fear
It doesn’t matter how many people are starving or homeless.  That doesn’t matter.  The ‘Great European Project’ must continue.  That’s why I have absolutely no hesitation in saying that I don’t just disagree with the architects of this European project, I believe them to be fundamentally bad and dangerous people.

In Greece, we talked before when it went through 50% youth unemployment.  The last figures I saw were (a shocking) 57%.  So we are now pushing up towards 60% (youth unemployment).  What we are looking at is something, I’m afraid, that is very, very akin to the Weimar Republic and that breakdown which happened in Germany in the early 1930s that led to Hitler.

I’m not saying Hitler is coming back to haunt Europe, but what I am saying is, isn’t it truly astonishing that we have Nazism on the rise in Southern Europe?”

Prop. 30 funds for UC will go to Wall Street

Big thanks to Kitty for finding this one.  JPMorgan and the rest of its Wall Street cohorts are profiting at the expense of their public institutional clients--again.  Which, of course, means taxpayers pay for the government's gambling losses--again.

How About a Fort Knox of Your Own?

Global Gold Production Is Poised To Fall Off A Cliff

Welcome to the Nuthouse: How Private Financial Fiat Creates a Public Farce

Biggest Winner From Obama Reelection? "Guns And Ammo"

China Says It Must Add To Gold Reserves To Promote Yuan Globalization And As An FX Hedge

Tuesday, November 13, 2012

This Is A Moment In Time That’s Never Been Seen Before
Part of the reason for the disparity of wealth in the country is because the policies of the Federal Reserve have helped eviscerate the middle class, both through losing money in bubbles and inflation, and the misallocation of capital and the ensuing destruction of jobs.  So the Fed’s policies have hammered the middle class.

Forget Mayans: Be Afraid of US Budget Armageddon

Is this the last straw for Eric Holder? Attorney General under pressure as it emerges he knew about Petraeus affair for MONTHS... but didn't tell Obama

David Petraeus scandal widens to include Barack Obama's cabinet

It takes a UK media outlet to report the potential cover up of the Benghazi attack.

Silver's outperformance over gold to be staggering long term - Butler

Sprott on Gold Market Outlook, Investment Strategy

The Five Stages Of A Sovereign's Life-Cycle

My Thoughts on the Election: The Devil You Know

Samsung Hikes Apple Component Price By 20%

Apple won the (court) battle in the US, and besides losing court battles in Asia, is losing the war in intellectual property against Samsung.

Sunday, November 11, 2012

The Die Is Cast And Only One Question Remains

Chinese Central Banker Declares That 'Gold Is The Only Safe Haven Left'
People's Bank of China official Zhang Jianhua declared yesterday: "No asset is safe now. The only choice to hedge risks is to hold hard currency - gold."

Zhang, the bank's research director, recommended buying the dips: "The Chinese government should not only be cautious of the imported risk caused by rising global inflation, but also further optimize its foreign-exchange portfolio and purchase gold assets when the gold price shows a favorable fluctuation."

Israel drawn into Syria fighting for first time

Oh-oh...we'll see how "real" this is if the price of crude oil spikes this week.

Spot The Start Of The End Of The Keynesian Dream

For those unfamiliar with the Baltic Dry Index, it measures the cost of moving raw materials (including crude oil) by sea, so it's a good indicator for the robustness of international trade.  With the index sinking, it indicates global trade is sinking--which normally translates to lower oil prices as a function of demand destruction.  Unfortunately--and counterintuitively, oil prices have remained elevated, which infers global currency induced cost push inflation.

Breaking it down to layman's terms:  despite a sinking global economy, instead of reduced demand causing falling prices, crude oil prices remain crushingly high as central banks worldwide debase their currencies.  This high inflation (despite "official" low numbers) causes a further dampening effect on the world economy.  In other words, easy monetary policies by central banks are intended to stimulate economies, but the endless printing of currency further aggravates the world economy.

The take away message is that as economies continue to stumble, central bankers will continue to print more currency units, locking us all into a death spiral of inflationary stagnation.  Hence, the term "stagflation" was coined in the 1970's to describe the same phenomenon.  It was a bad era then, but it will be worse today going forward because we have an untenable debt situation.

Ron Paul: A New Beginning
America is over $16 trillion in debt. The “official” unemployment rate still hovers around 8%.
Our federal government claims the right to spy on American citizens, indefinitely detain them, and even assassinate them without trial.
Domestic drones fly over the country for civilian surveillance.
Twelve million fewer Americans voted in 2012 than in 2008, yet political pundits scratch their heads.
It’s not hard to see why, though.
To go along with endorsing a never-ending policy of bailouts, “stimulus packages,” and foreign military adventurism, the establishment of neither major party questions the assaults on Americans’ liberties I’ve named above.
As my campaign showed, the American people are fed up. Many realized heading into Tuesday that regardless of who won the presidential election, the status quo would be the real victor.
GOP leadership is now questioning why they didn’t perform better.
They’re looking at demographic changes in the United States and implying minorities can only be brought into the party by loudly advocating for abandoning what little remains of their limited government platform and endorsing more statist policies.
My presidential campaign proved that standing for freedom brings people together.
Liberty is popular – regardless of race, religion, or creed.
As long as the GOP establishment continues to not only reject the liberty message, but actively drive away the young, diverse coalition that supports those principles, it will see results similar to Tuesday’s outcome.
A renewed respect for liberty is the only way forward for the Republican Party and for our country.
I urge all my Republican colleagues to join the liberty movement in fighting for a brighter future.
Ron Paul

What’s Next For Gold As Governments Become More Desperate

Celente - Gold, Silver, Riots, Theft & Global Collapse

Do We Have What It Takes To Get From Here To There? Part 2: China

On Germany's Desire To See America "On Its Knees", And Its "Infantile Crush On Obama"


Thursday, November 8, 2012

New York Mayor Bloomberg imposes post-Sandy fuel ration

Ron Paul: "Pure Democracy Is Dangerous"... When It's Purchased

Vegas Employer: Obama Won, So I Fired 22 Employees

The 1999 - 2001 Gold Bottom

This chart illustrates that the price of gold could drop to $1400 or $1025 tomorrow and the secular bull market would still be intact.

Chart Of The Day: When $0.99 Becomes Unaffordable, We Have A Problem
Most importantly, this was the first monthly drop in MCD comp sales since March 2003! So our question is: at what point does the perpetually self-deluded US population finally admit to itself that when even 99 cent meals are no longer affordable, that this country has a problem?

Do We Have What It Takes To Get From Here To There? Part 1: Japan
The U.S. Status Quo is as intellectually bankrupt as it is financially bankrupt. Our "leadership" cluelessly clings to the only model they know: incentivize "consumers" into borrowing more money to buy more "stuff" from China, in the magical-thinking belief this churn will somehow lead to sustainable "growth." This is akin to handing a parched alcoholic a fresh bottle of whiskey to wean him of his addiction.

Even - Odd gas rationing tweet from NYC Mayor Bloomberg

I predicted this 70's style gas rationing would re-occur several years ago.  Who's crazy now?

“Everything that needs to be said has already been said. But since no one was listening, everything must be said again.” — André Gide

Effective 6 am 11/9: drivers in NYC whose license plates end in an even number or zero will be able to buy gas only on even-numbered days

Important Insights for Arena Pharmaceuticals

Four more years of precious metals as the top performing asset class?

Wednesday, November 7, 2012

Max Keiser: 'Barack Obama is clueless. Mitt Romney will bankrupt the country'
Of the many themes that Keiser returns to in his shows, one of the most interesting and incendiary is the relationship between big business and Congress. He has openly accused senior politicians of using investigations into financial malpractice as a way of acquiring market information so as to benefit themselves.

"Democracy is not well served by the current political configuration in America," he maintains. "The entire political establishment is designed around enriching a minority of people who have access to both information and capital. Take the CIA. They have recently opened up their services to hedge funds. Hedge-fund managers can now hire CIA agents to do research on pharmaceutical companies, defence contractors, or oil contracts."

What You Need To Know About The Coming Gold & Silver Move

Fed’s Williams Says Bond Buying May Exceed $600 Billion

The title of this article should surprise nobody.

America Votes for National Suicide

Marc Faber's Asset Protection Plan: "Buy A Machine Gun", No Really, "You're Right, Buy A Tank"

Tags: Rogers | Obama | Re-election | Inflation Jim Rogers: Obama Re-election Will Spark Soaring Inflation Read more: Jim Rogers: Obama Re-election Will Spark Soaring Inflation

Look to Midtier and Small-Cap Gold Equities for Growth: Joe Foster

Perform your own due diligence.  Mining shares are not for the faint-hearted.

Now We Can Stop Paying Attention
Someday the markets will put a stop to the borrowing, but until then it really doesn’t matter who we elect or what they promise. Debt, after it reaches a certain level, is all that matters – not immigration policy or health care or marginal tax rates or short term interest rates or gay marriage. All are irrelevant compared to the institutional momentum of increasing leverage.

Total debt is now about $175,000 per citizen, or $700,000 per family of four. The average family’s income is something like $50,000, so it’s clear that we’ve long since passed the point where a return to a 1980s version of placid normality is a viable possibility for the country, any more than it would be for a typical family that woke up to find itself $700,000 in debt. Going forward the choice is to inflate or die.

This story is at least a decade old, and it’s getting tiresome for all involved. For the majority who expect positive change from each election the disappointment must be exhausting, as each inevitable compromise moves their latest hero one step closer to impotence. For the small number of people who see the underlying truth, this show is even harder to watch because the obvious, inevitable ending just won’t come. The zombie that should have died for good after the 2000 tech stock crash keeps shambling along, wreaking havoc or boredom, depending on whether you’re in its path or watching from a safe distance.

Hathaway: Gold Setup To Super-Surge To New All-Time Highs

MSM Ignored Real Issues

Treasury Quietly Warns: 'Expect Debt Limit to Be Reached Near End of 2012'

The US Treasury is starting to act like the credit risk it is becoming--yet again.

Obama Wins; Gold And Silver Jump 2 and 3 Percent
Investors should prepare for rising prices and more expansionary monetary policy now that President Barack Obama has won re-election, investor Jim Rogers told CNBC on news of the election.

The co-founder with George Soros of the Quantum Fund said he expected Obama’s policies to drive up commodities and drive down the U.S. dollar.

As the Federal Reserve moves to ‘stimulate’ a stalled economy through debt purchases, Rogers says markets should expect the status quo to remain the same.

“If Obama wins, it’s going to be more inflation, more money printing, more debt, more spending.” Rogers told CNBC, saying he expected to sell U.S. government debt and buy precious metals, such as silver and gold. 

“It’s not going to be good for you me or anybody else.”

“It looks to me like the money printing is going to run amok now, and spending is going to run amok now,” Rogers stated. “I have to invest based on what’s happening and not what I would like.”

Rogers said that he didn’t vote for either Romney or Obama, saying that “they’re both evil as far as I’m concerned.”

Greek Brothel To Sponsor Broke Elementary School

Obama Wins A Second Term: Now What?

This guy isn't a fan of either party, and wants true political reform.  Good luck with that.

Tuesday, November 6, 2012

What is POMO?

I apologize for what you’re about to read

Millennials are eating out less

Election 2012: How The Winner Will Destroy America

Well, this post made my day...

Special Forces and Navy SEALS Head to Polls, Counter Black Panther Presence

This is deeply disturbing.  It illustrates the racial, political, and class warfare engulfing the US.  This could be the precursor to something much bigger down the road.  The country is deeply divided.

Wall Street Reformers Unwittingly Turn Derivatives Market Over To Robots

In another example of unintended consequences, SkyNet is taking over the credit derivatives market as well equities.  This smells awfully like the 1980's, when "portfolio insurance" was anything but, as exposed in the 1987 crash, when the Dow lost a third of its value in one day.  Thanks to Kitty for finding this.

Monday, November 5, 2012

Christie orders odd-even gas rationing for some

In the "I told you category", how many times have I warned people the 70's style even/odd gas rationing system would be put in place again?  Click <here> and <here> for in-depth analysis.  I wasn't sure what type of natural disaster would trigger it.  I'm not bringing this up to brag.  I'm bringing it up to remind folks that just because something sounds outlandish, doesn't mean it can't happen.  I'm also reminding people that these events not only CAN happen, they have ALREADY happened.  People just have short memories--especially when the memories are unpleasant.  So wake up and smell the coffee, and get out of your normalcy bias funk.

My most extreme prediction is currency-induced cost push inflation will trigger hyperinflation, and gas rationing will becpme a permanent condition. Again, it appears ridiculous, but a hyperinflationary collapse has occurred throughout history, and every country experiences it at one time or another.  When central banks create trillions in credit and currency units out of thin air, the paper experiments never end well.  Hedge and stock up accordingly.

Here are the consequences of the Sandy aftermath.  Also, see how much gas is going for on Craigslist in some parts of New Jersey.  Click <here>.

Is a Central Bank Gold Run at Hand?

Would a second Obama term be good for gold?

Saturday, November 3, 2012

Gas--for those who hate waiting in lines

The laws of supply and demand reign supreme.  Get used to this.

||| DON'T WAIT IN LINE, WE HAVE 5 Gallons of GAS!! ||| (East Ruthorford)

Date: 2012-11-02, 2:23PM EDT [Errors when replying to ads?]

Hey Guys!

I waited on line for 2 hours to fill up a 5 Gallon gas container.

I'm willing to sell if for the right price and will deliver!

$25 per Gallon OR Shoot us your best offer!!


  • Location: East Ruthorford
  • it's NOT ok to contact this poster with services or other commercial interests
PostingID: 3381964248

Charles Ferguson: "Standing Behind Every Great Con Artist Is Someone Like Glenn Hubbard "

Many readers may get the impression I support Mitt Romney for President, given the evidence I've submitted that President Obama's policies have been a complete failure in terms of creating jobs and stimulating the economy.  Some of that evidence includes Obama's and Vice President Biden's connection and endorsement of Jon Corzine, who some allege swindled segregated client accounts before MF Global's spectacular collapse.

Readers, I can assure you that is not the case.  My disdain for politicians is bipartisan.  While Hubbard's resume may not include criminality, it certainly has large doses of deception and severe conflicts of interest.  In other words, politicians (and business school professors) can be liars, some bigger than others.

Step Aside Apple Line, Here Comes The Gas Line: Photo Album Of A Nation Waiting, Waiting, Waiting

For years, I've been telling anyone willing to listen that gas rationing will be a common occurrence in the future.  Most ignored me--even when I tell them not only will it happen, but it has ALREADY happened.  Everything was rationed during World War II, but the even/odd gas rationing system was developed in the 70's during the Iranian oil embargo.  Anyone under the age of 45 probably wouldn't remember it.

Gold Market Overview From An HFT Perspective

Friday, November 2, 2012

Agnico CEO - This Is What Is Happening In Gold Right Now

Dumpster Diving In The Lower East Side

Americans Aged 18-29 Have A More Favorable Response To Socialism Than To Capitalism

I guess the lessons of Stalin, Lenin, and Mao were lost when our educational system taught world history.

Get Ready For Big Moves In Gold, The US Dollar & The Euro

Yes, the USDollar moves inversely to the price of gold, but both can rise on a nominal basis if other paper currencies drop faster.  The take away message is gold will be the last currency standing.

Greyerz - Gold & The Incredible Financial Destruction We Face

Greyerz - One Of The Most Important Charts Ever