Monday, April 28, 2014

It’s No Longer Possible To Avoid the Word “Bubble” | Andy Hoffman

Andy Hoffman discusses that home sales are dropping, retail sales are worst since 2008-2009, China selling treasuries, Yuan at a new multi-year low, QE, droughts in California, gold and silver. 
This video was posted with permission from Andy Hoffman, Media Director at Miles Franklin (
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This Chart Is A True Picture Of The Bank Credit Bubble In America, Now Bigger Than The Last One (Which Blew Up)

For a while, rumor had it that banks weren’t lending, and that this was the reason the recovery has been so crummy and that businesses weren’t expanding and that jobs weren’t being created fast enough. There was no demand for loans, and banks were too tight with their lending standards. Or so the story went.
Turns out, banks have been lending. Not only that. They’ve been lending more than ever before. They have been lending even more than during the last credit bubble, when too many easy loans were made helter-skelter by loosey-goosey loan officers while the Fed’s spigot was wide open, which helped blow up the financial system.
Note the beautiful big-fat bank credit bubble that emerged in 2002, picked up speed as it went, and took off in earnest in 2007, when the chart begins. And note how it soared exponentially in 2008. At the time, the banking system was coming apart at the seams, the housing market was tanking, Bear Stearns got cooked, and stocks were skidding. Nothing stopped the bank credit bubble. Nothing until Lehman Brothers went belly-up in September. Bank CEOs worried about being next. And that finally punctured it.
So the peak was reported in October 2008. Loans and leases outstanding at all commercial banks in the US (black line, left scale) hit $7.28 trillion and all bank credit (red line, right scale) maxed out at $9.56 trillion. Then the great cliff dive began, hitting bottom in February 2010 – outstanding loans and leases at $6.5 trillion, all bank credit at $8.9 trillion.
Now we’re back! Only this time, the bank credit bubble is even bigger. Last month, outstanding loans and leases reached $7.52 trillion and bank credit $10.3 trillion. Halleluiah!
But wait…. November last year, they started soaring. Because this is the biggest credit bubble in history, and it’s time to pick up speed, in a move that is reminiscent of the jump in mid-2008, even as all heck had already broken loose.
The underlying idea is simple – an idea that has morphed into a special sort of higher religion at the Fed that everyone has to believe in and that no one is allowed to question: the US economy can only grow if debt grows even faster. So total bank credit rose 3% in 2013, for example, and US gross national debt soared by $883 billion, or 5.4%. But GDP rose only 1.9%.
This is what a credit bubble looks like: piling on debt and more debt at all levels while producing only anemic economic growth, so that the debt burden, relative to the economy, gets more and more onerous, and only the Fed’s zero-interest-rate policy can keep the whole construct from collapsing under its own weight, which it will do anyway even with ZIRP, but later and only after even more debt has been piled on so that the damage will be even greater.
This is how the Fed envisions our debt-fueled economy where leveraging everything up to the hilt is the norm, where nearly free money is required at all times to keep the machinery from seizing up, and where inflation, the Fed’s preferred solution to this debacle, will ultimately eat into the wealth of all those who hold this debt.
And those yield-desperate investors, driven to near insanity by the Fed’s interest-rate repression, hold their noses and close their eyes to scrape up even the crappiest debt just to get a little extra yield. “On the way in, there’s insatiable demand.” Alas, “it’s going to be a disaster on the way out.” Read…. Biggest Credit Bubble in History Runs Out Of Time

Decline of US Middle Class – Karl Denninger on Fed Policy

Our lead story: America’s middle class has long been the most affluent in the world. However, new data shows that the US has lost that honor, especially in lower and middle tier income brackets. It’s probably no surprise to learn, America’s wealthiest have outpaced many of their global peers. Erin takes a look.After the break, Erin joins blogger and former white collar caper Sam Antar to talk about some of the recent cases in white collar crime. Take a look on his view of Herbalife and Banamex. Then, Erin brings you part two of her interview with Karl Denninger. He talks about Fed policy, big banks, and fiat currency. Check it out.In today’s Big Deal, Edward Harrison sits down with Erin to look at mobile home economics. Turns out some investors are getting into the trailer park business for its double wide returns. Check it out.

Banksters : how to be a crook

GOLD IS GONE: Cornered by CHINA | Murphy & MacLeod (Encore)

- Mainstream Media reports gold manipulation ?1:19 ~ Bloomberg article:
- Central banks should consider that many of them won’t get their gold back ?4:55 ~ Macleod’s article:…
- Gold market in a new bull phase ?8:54 ~ South Carolina reports gold manipulation:
- Fed tapering will have no effect on gold prices ?12:45
- China’s shadow banking system implosion to be the catalyst for gold price spike ? 16:09
- Sergei Glazyev, Kremlin economic aide, “An attempt to announce sanctions would end in a crash for the financial system of the United States” ?19:43 ~ Telegraph article:
- Russian parliament is considering the possibility of confiscating U.S. and European companies’ property and assets ?22:52 ~ Source ?
*This panel discussion was originally posted on March 10th, 2014.
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DISCLAIMER: The financial and political opinions expressed in this interview are those of the guest and not necessarily of “Finance and Liberty” or its staff. Opinions expressed in this video do not constitute personalized investment advice and should not be relied on for making investment decisions.

The Desperate Hustle as a Way of Life

Source: Cryptogon

Via: City Paper:
Here is the future: nobody gets any job security. Nobody gets a fair wage while they have a job. Nobody gets a retirement fund or even any guarantee they’ll be able to eat tomorrow. And almost everyone is doing everything they can just to get by—and paying some substantial portion of their earnings to a pimp or “platform” which controls the business they are in. And ain’t life a grand adventure? Isn’t it all so fun?
Welcome to the Sharing Economy.
This is the model of the new economy, where anyone with a car ought to be a Lyft contractor (your fare pays what he or she thinks is right but the company is tweeting out “we’ve slashed prices 20 percent”) and anyone with a house or apartment is renting it out on Air BnB and crashing at their boyfriend’s parents’ place.
All of this came about by design. The world is arranged according to the people who arrange things—the people who make money by this arrangement. We’re in our fourth decade of this. The Times reported this week that the American middle class has been surpassed by Canada’s.
And it’s much worse than the New York Times imagines. As Dean Baker points out, the middle classes in most other countries have increased their incomes while getting longer vacations. In the U.S.A.? Not so much.

But this life of hustle—the idea that everything you do, every day, needs to turn a profit or you starve—is familiar to anyone who lives or grew up in an inner city. In Salon today, D. Watkins points to the junkies putting on a fight-show for crack, and the lady who runs the candy/cig shop out of her second floor window, lowering the product down in a pencil box tied to a rope of shoelaces. You’ve seen the guys moving “loosies” and the guys selling the bags from the food pantry.
They are fucked. And we are them.

Better to be Poor in Europe than in U.S.; Better to be Middle Class in Canada than in U.S.

Source: All Gov.

Of the 16 teams that qualified for this year’s Stanley Cup Playoffs, only one, the Montreal Canadiens, is from Canada. The rest are from the United States, which some would say means Americans have beaten their neighbors to the north at their own game.
But Canada has outpaced the United States in a contest of which Americans always proudly declared ourselves the winners: whose middle class is faring best?
Median per-capita incomes in the United States and Canada were about tied in 2010 at $18,700 after taxes, but Canada’s figures have improved since then, according to The New York Times. This comes even though the United States is still the world’s richest country. However, increasing income inequality in the U.S. has caused median incomes to drop even as average incomes increase because of huge gains at the high end of the scale.
Poor people in the United States fare even worse, as they are far behind the median incomes of those living in Canada and much of Europe. A U.S. family at the 20th percentile of the income distribution makes far less money than a similar family in Canada, Sweden, Norway, Finland or the Netherlands. The income data were compiled by LIS, a group that maintains the Luxembourg Income Study Database and studies income levels worldwide.
Pay has risen much faster in Canada and Western Europe than it has in the United States. Even though U.S. companies are doing well, they’re not sharing the wealth with their workers. And the money Americans do have is buying less.
“The idea that the median American has so much more income than the middle class in all other parts of the world is not true these days,” Harvard economist Lawrence Katz told The Times.
According to a study by The Third Way, the costs of things those in the middle class are most concerned about, housing, health care, college for their children and retirement, are rising much faster than wages.
Educational attainment is rising at a slower rate in the United States now than in other nations, putting American young people behind in the race for technological jobs. And other nations are more aggressive about redistributing wealth to the less fortunate than Americans are, taxing the wealthy at higher rates and insuring better benefits for those with lower incomes.
Even Sweden, with its extensive social welfare system, has seen its per-capita gross domestic product grow faster than it has in the United States. Part of that growth is fueled by the large number of college graduates in Sweden, which allow that country to compete better for high-tech jobs.
Not all European countries are doing better than the United States, of course. Nations with weaker economies, such as Portugal and Greece, have struggled.
-Steve Straehley

Collapse Of Western Ponzi Scheme To Send Gold Skyrocketing

Today, Grant Williams, one of the most highly respected fund managers in Singapore claimed in an interview that the collapse of the Western Ponzi scheme will send the price of gold skyrocketing. Williams also discussed the coming implosion of the Western scheme as well as how the Russians and the Chinese positioning themselves ahead of this collapse. Brian covers highlights from the interview on today’s show and offers his perspective on Williams’ claims.

Retail Bankruptcies, Closings Sweeping America

35 Countries Where the U.S. Has Supported Fascists, Drug Lords and Terrorists Here's a handy A to Z guide to U.S.-backed international crime.

Photo Credit:
By Nicolas J.S. Davies
The U.S. is backing Ukraine's extreme right-wing Svoboda party and violent neo-Nazis whose armed uprising paved the way for a Western-backed coup. Events in the Ukraine are giving us another glimpse through the looking-glass of U.S. propaganda wars against fascism, drugs and terrorism. The ugly reality behind the mirror is that the U.S. government has a long and unbroken record of working with fascists, dictators, druglords and state sponsors of terrorism in every region of the world in its elusive but relentless quest for unchallenged global power.  
Behind a firewall of impunity and protection from the State Department and the CIA, U.S. clients and puppets have engaged in the worst crimes known to man, from murder and torture to coups and genocide. The trail of blood from this carnage and chaos leads directly back to the steps of the U.S. Capitol and the White House. As historian Gabriel Kolko observed in 1988, "The notion of an honest puppet is a contradiction Washington has failed to resolve anywhere in the world since 1945." What follows is a brief A to Z guide to the history of that failure.
1. Afghanistan
In the 1980s, the U.S. worked with Pakistan and Saudi Arabia to overthrow Afghanistan's socialist government. It funded, trained and armed forces led by conservative tribal leaders whose power was threatened by their country's progress on education, women's rights and land reform. After Mikhail Gorbachev withdrew Soviet forces in 1989, these U.S.-backed warlords tore the country apart and boosted opium production to an unprecedented level of 2,000 to 3,400 tons per year.  The Taliban government cut opium production by 95% in two years between 1999 and 2001, but the U.S. invasion in 2001 restored the warlords and drug lords to power. Afghanistan now ranks 175th out of 177 countries in the world for corruption, 175th out of 186 in human development, and since 2004, it has produced an unprecedented 5,300 tons of opium per year.  President Karzai's brother, Ahmed Wali Karzai, was well known as a CIA-backed drug lord. After a major U.S. offensive in Kandahar province in 2011, Colonel Abdul Razziq was appointed provincial police chief, boosting a heroin smuggling operation that already earned him $60 million per year in one of the poorest countries in the world.
2. Albania
Between 1949 and 1953, the U.S. and U.K. set out to overthrow the government of Albania, the smallest and most vulnerable communist country in Eastern Europe.  Exiles were recruited and trained to return to Albania to stir up dissent and plan an armed uprising. Many of the exiles involved in the plan were former collaborators with the Italian and German occupation during World War II. They included former Interior Minister Xhafer Deva, who oversaw the deportations of "Jews, Communists, partisans and suspicious persons" (as described in a Nazi document) to Auschwitz. Declassified U.S. documents have since revealed that Deva was one of 743 fascist war criminals recruited by the U.S. after the war.
3. Argentina
U.S. documents declassified in 2003 detail conversations between U.S. Secretary of State Henry Kissinger and Argentinian Foreign Minister Admiral Guzzetti in October 1976, soon after the military junta seized power in Argentina. Kissinger explicitly approved the junta's "dirty war," in which it eventually killed up to 30,000, most of them young people, and stole 400 children from the families of their murdered parents. Kissinger told Guzzetti, "Look, our basic attitude is that we would like you to succeed... the quicker you succeed the better." The U.S. Ambassador in Buenos Aires reported that Guzzetti "returned in a state of jubilation, convinced that there is no real problem with the US government over that issue."  (" Daniel Gandolfo," "Presente!")


Altyn Becomes New Currency For The Eurasian Customs Union – Koos Jansen

Published on Apr 24, 2014Altyn becomes new currency for the Eurasian customs union.
New Eurasia currency may appear in the next five years.
Read more on In Gold We Trust…

Great Things Keep Happening | Andy Hoffman

In this interview with Andrew Hoffman:
The Ukraine going from bad to worse;
First week after sales tax hike in Japan sales down 25%;
What if anything has been successful about Abenomics;
ECB 1.4 trillion QE coming;
Draghi says loosening of monetary policy coming soon;
In US 20 percent food price increase affecting fake PPI numbers;
FOMC minutes proved ending fake ZIRP was false;
HFT and Flash Boys discussion;
Gold physicla demand keeps going up-wonder why.
This interview was recorded on 4/14/14 posted with permission from Kerry Lutz of 
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Japan's ridiculous "abenomics" now wants 29% interest rates

Kathy Fettke: Real Estate Market is not a Free Market

Wall St for Main St interviewed Real Estate expert Kathy Fettke, who is the CEO and Co-Founder of The Real Wealth Network. In this podcast, we discussed Kathy’s background and what got her interested in real estate.Kathy told us her thoughts about the general real estate market and the housing bubbles that are still brewing in California and other parts of the U.S.Kathy also gave advice for young investors wanting to get into the real estate market and told us her criteria for looking for a good location to invest in real estate. Plus much more!

Todd Harrison: There’s Many Financial Ticking Time Bombs Out There

Former top hedge fund manager, 20+ year Wall St veteran and founder of Minyanville Todd Harrison returned for another Wall St for Main St podcast interview.During this 30 minute interview, Jason asks Todd about the global macroeconomic situation and what is happening in markets when countries like Japan and China print even more money than the US does.Todd talks about market sentiment being very negative even though US stock prices still remain high and Todd expects a major stock price correction in the near future.Jason and Todd talk about how markets have tested past new Fed Chairman and if Janet Yellen will be tested with a potential 1987 or 2007 style crash.Jason then asks Todd about how in his last interview on a WS4MS podcast in 2012 he predicted a secular bull market in marijuana and how many marijuana stocks are up over 500% since then. Todd talks in details about why the bull market is occurring and the conditions he thinks are necessary for it to continue.Finally, Jason asks Todd about the inflation vs deflation debate. Todd thinks we have both occurring simultaneously but thinks the people at the Fed clearly prefer to have inflation.To wrap up the interview, Todd says he expects enormous volatility in all markets going forward because of the amount of global liquidity pumped into markets even though the Federal Reserve is tapering. He says the “little guy” will need to learn to hedge, adapt and be nimble or he should avoid investing or trading markets going forward.

"I Don't Trust The Government!" Dwight Yoakam Explains To Piers Morgan W...

Sunday, April 27, 2014

Grant Williams – On Whats Happening With Gold

Grant thinks gold has already bounced off its low…
And the geopolitical factors Grant mentioned ought to push gold higher from here:
** Just how much gold is China buying?** If it turns out that the paper gold markets are heavily manipulated, that should push the spot price up, too…

The Global Banking Game Is Rigged, and the FDIC Is Suing

Biggest Credit Bubble In History Runs Out Of Time

It has been a feeding frenzy for junk debt. Yield-desperate investors, driven to near insanity by the Fed’s strenuous interest-rate repression, are holding their noses and closing their eyes, and they’re bending down deep into the barrel and scrape up even the crappiest and riskiest paper just to get that little extra yield.
Last year, highly leveraged companies issued $1.1 trillion in junk-rated loans. It’s a white-hot market. Leveraged-loan mutual funds – dolled up in conservative-sounding names and nice charts to seduce retail investors – gorge on these loans. They saw 95 weeks in a row of inflows, week after week, without fail, adding over $70 billion to their heft, as Bloombergreported, and only the sky seemed to be the limit. But suddenly, that endless flow of money reversed.
“It’s going to be a disaster on the way out,” Mirko Mikelic, who helps manage $7 billion in assets at ClearArc Capital, told Bloomberg. “On the way in, there’s insatiable demand….”
Private equity firms have been ruthlessly taking advantage of that “insatiable demand.” And they have a special self-serving trick up their sleeve: Their junk-rated overleveraged portfolio companies issue new loans, but instead of using the funds for expansion projects or other productive uses, they hand them out through the back door as special dividends. It’s one of the simplest ways PE firms use to strip cash out of their portfolio companies. It loads even more debt on the already highly leveraged portfolio company without adding productive capacity. And those who end up holding this debt – for example, the mutual fund in your portfolio – have a good chance of losing it all.
“It’s kind of like an epidemic,” explained Martin Fridson, a money manager at Lehmann, Livian, Fridson Advisors LLC, in an interview with Bloomberg. “Once an investment banker sees that, he’s going to go to his clients and say, ‘Here’s a window of opportunity, you can take a dividend and get away with it.’”
And they’ve been getting away with it. Default rates on junk debt hovered at 1.7% in the first quarter, a near record low. But that’s always the case when liquidity sloshes through the system and years of interest rate repression turns yield investors into brain-dead zombies, always willing to replace troubled debt with new money. But the historical average is 4.5%, and when things tighten up, as they did during the financial crisis, default rates jump into the double digits [read.... Biggest Credit Bubble in History Flashes Warning: ‘Seek Cover’]. 
They’re all doing it. Junk-rated mobile-phone insurer Asurion finagled a $1.7 billion loan in March. But instead of doing something productive with the funds to generate cash flow to service the loan, it blew the money out the back door as a special dividend which it owners – PE firms Madison Dearborn Partners, Providence Equity Partners, and Welsh Carson, Anderson & Stowe – pocketed with gusto.
BMC software borrowed $750 million via one of the riskiest forms of debt, payment-in-kind (PIK) notes, where, if push comes to shove, BMC can chose to pay interest not with cash but with more of the same debt. The amount it owes gets larger, as its chances of survival shrivel. Instead of defaulting, the company will simply hand the lender more paper that’s increasingly worthless. BMC promptly forwarded the $750 million to its owners, a group of PE firms let by Bain Capital that had acquired BMC only seven months earlier.
Time is of the essence. Platinum Equity, which had acquired Volvo’s rental car division, waited only a week after closing the deal before sucking $262 million out that the company had obtained by issuing PIK debt.
So far this year, these already overleveraged companies have issued nearly $21 billion in junk-rated debt for the purpose of paying special dividends to the PE firms that own them – the most since the bubble of 2007, before it all blew up spectacularly. Of that, $3.5 billion were these reeking PIK notes. When a default occurs, the PE firms have the cash, and the lenders get stuck with largely worthless paper.
That’s what invariably happens when the Fed’s interest rate repression pushes investors out toward the thin end of the risk branch. During normal times, no sane lender would go along with this without demanding a confiscatory yield. The door would be closed to these sorts of glaring wealth-transfer shenanigans. But these are not normal times. This is the greatest credit bubble in history.
Among the most insatiable buyers of this stuff: leveraged-loan mutual funds, and by extension, retail investors. But now, they’re getting cold feet, apparently, and for the first time, after 95 weeks in a row of inflows, they yanked money out, Bloomberg reported. Not a panic just yet, but the flow has reversed. In the week ended April 16, they drained $276 million out of these mutual funds.
And these funds are starting to bleed. The LS&P/LSTA Leveraged Loan 100 Index, which sports a 5-year annual return of 10.5%, dipped into the red for April and might book its first monthly loss since the taper-tantrum turmoil last summer.
Mutual funds that hold leveraged loans are fearsome products. They entice investors with a little extra yield, but still less than an FDIC insured one-year CD used to pay in the pre-crisis days. That’s how far the Fed has pushed it. But these loans are even less liquid than corporate bonds. Unlike bonds or stocks, they’re not regulated. They’re traded the old-fashioned cumbersome way, via email or even the phone, involving complex paperwork that may take weeks to complete. It’s not easy to transfer a loan. And when belatedly spooked investors start selling these mutual funds, fund managers are forced to dump loans into a market where liquidity just evaporates without notice. Prices plunge on the sales that do go through – and those who get out first, bleed the least.
“We all feel like we’re at the top of the cycle, and everyone’s skating on new ice,” explained Nick Beim about a parallel and equally treacherous aspect of the bubble that everyone knows is going to deflate someday with a terrific hiss. He is a partner at venture-capital firm Venrock, and the startup scene has come unhinged, with 33 startups in the US alone having valuations of $1 billion or more. Dropbox crowns the list at $10 billion. A lot of moolah for a small money-losing outfit. But turmoil and losses and whiffs of reeking reality have suddenly replaced blue-sky exuberance. Read…. IPO Craze Peaks, Investors Scurry Out of the Way, VCs Fret

Gold And Silver – Prospects For Both From A Russian POV

[POV = Point Of View]
One of the biggest problems for the West, the US in particular, is its increasingly
parochial perspective from the narrowest of lenses,  fully colored by the elite’s use of
its main propaganda machine, the Maintstream Media.  It will not work for people to
expect more from their government, rather, people have to demand and expect more
from themselves, for in the end, people will discover all they really had to rely upon
was themselves and failed to do so.
All of the information one needs to make more enlightened decisions is out there.
One has to change their broken habits of spoon-fed expectations from local news and
take a more active role in seeking the truth.  In a nation that relies upon a police state,
increased militarization, and NSA [STASI] spying on its docile population, one cannot
expect to hear truth, only lies, and the Obama administration is certainly delivering them.
Ask yourself, what is your impression of Russia, of Putin?  Then, consider the following
information about both.  Never in the history of the world have [mostly] Western central
bankers issued anything but worthless paper currency, backed by nothing, controlled by
unelected bureaucrats, and none beholding  to nor responsible for citizens of a nation,
your neighbors and everyone you may know.   This is the world in which most of you live
without challenging it.  Others, outside of the Western sphere of central banks, with a firm
grip on their respective governments, refuse to remain a victim of the West’s inflationary
degradation via fiat currencies and the rot-from-within they generates.
Who has been the champion prodder of the Ukrainian situation?  The United States, led
by its teleprompter-reading corporate president, Barack Obama.  What has he done?
Threatened economic sanctions, provided neo-Nazi thugs to continue to stir unrest, steal,
or remove, if you prefer, all the Ukrainian gold in the middle of the night, and drain the
country of billions of dollars, transferred to Swiss banks.  Are any of these moves in the
least bit constructive, let alone justifiable?
Putin’s response?   Aggression to match aggression?  No.  Just patience, waiting as events
that are doomed to fail play out.  While Obama does what he can to stir up a hornets nest
in an area of the world the US has no business in interfering, Putin is allowing Obama to
take as much political rope as he needs to hang himself.  In the meantime, Putin is busy
putting together deals with other countries, and its natural gas deal with China in the
works will be a game-changer for Russia.   All of the deals made and those in process will
bring income to Russia as a nation.  What kind of income?
More rubles, some yuan, maybe even some gold.  Totally absent is the use of the dollar
as the disappearing world reserve currency.  Putin is taking his job of running a country
seriously and responsibly.
Putin spurns Western central banks and continues to strengthen the ruble.  He makes
deals with other natural resource-rich countries.  Obama invades oil-rich countries.
While Obama pushes for war on the other side of the world with Syria and Ukraine,
Putin is busy making deals on the other side of his world with Obama’s ignored neighbors,
Mexico and Latin America.  While Obama allows the Fed and Wall Street to continually
suppress and disparage the gold market, Putin is building Russia’s gold reserves.  No fiat
ruble over there.
What has Obama done to help strengthen the US financially?  Nil, and to the contrary,
he has increased government spending, with no means of ever repaying it, and he has
worsened the plight of millions and millions of Americans through his enrich-insurance-
companies scheme at the expense of leaving people without affordable insurance coverage.
Most Americans have never heard of Russia’s Gazprom, yet it dwarfs Exxon and Mobil in
size.  In anticipation of Western sanctions, Gazprom secured natural gas deals with China.
If Gazprom never sold another energy unit of natural gas to the West, its bottom line will
continue thrive with its natural gas sold to the East.  Further, Gazprom will now only sell
their product using rubles, yuan, and gold, no petrodollars allowed.
The Russian banking system has responded to the West’s petty and of no-effect sanctions
by raising a one-finger salute to the West.  Russian banks have stopped using the dollar
and have adapted total reliance upon its own ruble, intent on having the ruble become a
part of any new global currency.  US banks continue to entrap citizens with debt-forever
fiat.  Russia has the second largest gold reserve in the world.  US is the highest debtor
nation in the entire world.  The US has always had a fondness for being number 1 in
The fact that Russia has rejected the dollar in every way, coupled with another fact that it
will only transact its gas and oil trade in the ruble will have an impact on the US and the
West more than any sanctions Obama can ever hope to [under]achieve.  As a  consequence
of pushing Russia away from the [totally failed] Western banking system, the US stands to
lose trillions of fiat $ in return.  It is not just Russia.  All of the other BRICS nations are
following suit.  The US and the central banking system is committing seppuku, [hari kari],
financial [self-imposed] disembowelment.
Still think of Russia as an “evil empire?”  Here is a quote from one of Russia’s members of
Parliament on the US and its fiat:
The dollar is evil. It is a dirty green paper stained with blood of hundreds of
thousands of civilian citizens of Japan, Serbia, Afghanistan, Iraq, Syria, Libya,
Korea, and Vietnam. Our national industrial giants will not suffer any losses if
they choose to make contracts in Rubles or other alternative currencies. Russia
will benefit from that. We should act paradoxically when we deal with the West.
We will sell Rubles to consumers of our oil & gas, and later we will exchange
Rubles for Gold. If they do not like this, let them not do this and freeze to death.
Before they adjust, and this will take them three of four years, we will collect
tremendous quantities of Gold. Russian companies will at last become nationally
oriented and stop crediting the economy of the United States that is openly hostile
to Russia.”    
Source: Izvestia newspaper
What of he US ally Germany?  Guess where Germany will turn when push comes to
shove?  East!  It has vastly important financial ties with Russia.  Germany’s ties to the
US?  Mostly fiat and highly objectionable NSA tentacles covering the country.
Israel.  Surely the staunchest US ally?  Well, it turns out that the US worsening of events
in Ukraine are a threat to Israeli security.  Israel has its own floating Tamar natural gas
platform, and it has made a deal with Gazprom to export the liquified natural gas.
How much of any of this has anyone read or heard about from government-controlled
mainstream media?  Not a peep, not a sentence.  The elites want US citizens to remain
dumbed down, and US citizens are complying in utter ignorance and steadfast refusal to
consider any alternative news sources.  Reliance upon the total control over the corporate
and bankrupt federal government’s newspeak is the elite’s goal.
At the outset, we said people need to expect more from themselves and take more
responsibility for their own lives.  Reliance upon any government is a trap from which
there is no escape.
We have not even covered all that can be covered re Russia and Putin, or Obama and the
federal government, for that matter.  We have not even touched China, India, the growing
BRICS nations as a power unto themselves, totally outside of and separate from the self-
toppling United Sates.
The acronym BRICS brings to mind the story of the Three Little Pigs, making houses of
straw and twigs that failed, [fiat], with the safest being the one built of brick.  The
BRICS are using a lot of gold in building their financial ties together.
None of this addresses timing, but the message is clear:  financial integrity and strength
is relying upon gold, in some large degree, as a standard, at least indirectly.  The message
should be the same for us all who endeavor to withstand the inevitable fall-out from fiat
currencies destroying the Western financial system.  The East, parts of the Middle East,
and even Central and South American countries are accumulating gold.  There is no
concern about gold going lower or even not going higher, for now.  The end-game is not
the short-term price, it is for where gold will seek its natural price level once freed from
Western central bankers and to not be caught holding nothing but value-lost paper.
On a side note, the elites are not stupid.  It is likely that they may even be orchestrating
the demise of the Federal Reserve Note “dollar.”  The direction may have been intended
to replace the “dollar” with another fiat issue, like an SDR, [Special Drawing Rights], to
be issued by an all-controlling, non-elected or representative government, like the BIS,
[Bank for International Settlements], or some similar elite organization.  What was not
anticipated, during all the decades of planning, was the rise of the East and the use of
gold as a measure of currency control.
Last week could have been an important anchor for a turning point in gold and silver.
The comments on the weekly chart cover a lot of ground.  What can be added are the
observations labeled 4 and 5.  Both are directed at the level of volume.   The area marked
4 shows increased volume as price rallied.  On the current correction, volume has dropped
off.   This tells us that the selling pressure is not there, as it used to be.
The gold price is also respecting, albeit loosely, the half-way correction area between the
recent swing low and swing high.  In somewhat of a down market condition, that is a good
showing.  Gold’s failure to decline to the lower channel line is an indication of strength.
GC W 26 Apr 14
The daily gold chart is confirming observation made on the weekly, but with more detail.
What was not covered in the chart comments was the thin line at the half-way measure
of the down sloping channel.  Whenever price can hold the half-way point of anything, it
is taken as a relative measure of strength
GC D 26 Apr 14
Silver is a test of one’s patience.  All purchases made at current, even slightly higher, prices
will be viewed as gifts and wise moves sometime in the future, be it later this year or into
2015/2016.  When silver finally does rally away from its [very constructive] support zone,
purchases made at 
any higher price in the past few years will look like bargains.
The way the charts are setting up, even purchases in the paper futures market now have a
diminished downside.  What cannot be known is 
when a move to the upside will make any
such buys worthwhile from a profit perspective.
SI W 26 Apr 14
That high volume spike should loom as important, moving forward.  As with gold, it may
be an anchor for establishing the low point for silver, too.  Similar to gold, silver has kept
just above the half-way area in its down channel.  In this last correction, silver did not
even come close to reaching the lower channel live, as it did in late March.  Last week’s
close has it bumping up against the upper channel line very soon after the last challenge
just two weeks ago.  This is a positive development within a negative down trend.
On an ending note, last week, mention was made of Gann and the Cardinal Grand Cross,
an astrological significant time frame.  It all ends with a solar eclipse on the 29th. [See
Gann, Cardinal Grand Cross, A Mousetrap And Wrong Expectations, if you did not read
it.]  It is just interesting to see how both gold and silver can be potentially bottoming at
the same time.   From our unwavering point of view, price and volume remain the most
reliable guides and source of market information.
SI D 26 Apr 14

Ethnic, religious diversity can lead Malaysia to a brighter future, says Obama

The President of the United States, Barack Obama believes that, like the US, Malaysia can draw strength from its ethnic and religious diversity and learn from history to carve a brighter future for the next generation.
In his remarks at a state banquet hosted at Istana Negara in conjunction with his three-day state visit to Malaysia, Obama noted that while the US and Malaysia may be different as nations, their people shared similar hopes and aspirations, Bernama reported today.
"I believe that whether we come from a remote village or a big city, whether we live in the United States or in Malaysia, we all share basic human aspirations - to live in dignity and peace.
"(We want) to shape our own destiny, to be able to make a living and to work hard and support a family. And most of all, to leave the next generation something better than what was left to us," Bernama reported him as saying.
According to Bernama, Obama said these were the aspirations that can illuminate a new era of partnership between the US and Malaysia.
The banquet was graced by the Yang di-Pertuan Agong Tuanku Abdul Halim Mu'adzam Shah and Raja Permaisuri Agong Tuanku Hajah Haminah, as well as Prime Minister Datuk Seri Najib Razak.
The US president, who spent some years in Indonesia as a child, also sprinkled a few Malay words and expressions during his speech at the banquet. This was well received by the audience who responded generously with applause at his valiant attempts.
"Selamat petang" (Good evening) and "terima kasih banyak" (thank you very much) were the key lines he used at the start and end, respectively, before speaking of "bekerjasama" and the "boleh spirit" to illustrate the partnership between the two nations, Bernama reported.
Obama arrived in Kuala Lumpur today on a three-day visit to Malaysia as part of his four-nation tour of Asia that started in Japan followed by South Korea while his final stop is the Philippines.
His trip here is the first by a sitting US president in 48 years since President Lyndon B. Johnson's trip back in 1966. – April 26, 2014.

Jim Rickards – ECB’s Draghi Is The Model Central Banker

Obamacare Exchange 'Cover Oregon' Collapses in Failure

Breitbart News and others have chronicled the "Unmatched failure" that Cover Oregon has now officially become. As was pointed out on March 20 of this year, "The Oregon Obamacare exchange has received $305 million in taxpayer-funded federal grants, spent $160 million on its busted website, dropped $10 million on hipster promotional ads, erroneously enrolled 4,000 illegal immigrants in full Oregon Health Plan coverage contrary to federal law, and has not enrolled a single Oregonian online."

Oregon was even given "a $48 million "early innovator" grant for states whose exchanges were intended to serve as models for the nation." While the money was spent, clearly, that promised was never fulfilled
State officials may finally be coming to grips with the idea that they have failed completely. It looks like the exchange will be closed down and turned over to the feds. Perhaps fittingly, the White House's favorite exchange will be turned over to the White House.
Cover Oregon's former Director rocky King had already resigned in January and he wasn't the first, "King is the second official connected to the exchange to resign. He came under fire when the online enrollment system failed to go live in October. Technical problems with the exchange have been an embarrassment to the state and forced Oregonians to apply using paper applications. The state had to hire or reassign nearly 500 people to process applications by hand."
On March 21 Breitbart News reported on questionable behavior as a processing center.
A former Cover Oregon employee is blowing the whistle on her working environment, claiming that employees were encouraged to push paper applications through the process despite obvious problems such as missing Social Security numbers.
The whistleblower appeared in an interview with KATU investigators which was published Thursday. She said when she questioned whether it was appropriate to process some of the claims she was seeing a manager told her to "quit stressing and go take a walk." Another anonymous source told KATU "I’m not sure when it started but then eventually we were told, if they don’t have a social just go ahead and enter it, just push it on through."
And from there, it just keeps getting worse, "Oregon’s state exchange is the “only one to fail so spectacularly that no residents have been able to sign up for coverage online since it opened early last fall. The Post added that it would cost the state between $4 and $6 million to move Cover Oregon’s exchanges into the federal insurance marketplace. But that is only a fraction of the $10 million the federal government awarded Oregon to promote those exchanges in what some mocked as the least informative but most trippy health insurance ads associated with the ACA."
Now, with millions wasted on a massive failure in terms of development and millions more in protion of that which we now know will never work, this may prove to be the poster child for the ongoing failures of ObamaCare.
Long on problems and so short on answers there effectively aren't any, Cover Oregon will revert to federal control. And it may not be the last state in which that has to happen.
"The Obama administration is poised to take over Oregon’s broken health insurance exchange, according to officials familiar with the decision who say that it reflects federal officials’ conclusion that several state-run marketplaces may be too dysfunctional to fix.
Unfortunately, there are few reasons to believe much of anything about the floundering law is functional, whether it's being administered at the state, or federal levels.

Obama’s Wrong Headed Approach To China

Should You Buy Gold and How Much

An IT worker writes: 'Emotionally, we are broken'


Training your replacement must be an awful experience. It’s bad enough to lose a job. It’s an entirely different thing when you believe that U.S. government H-1B policies are assisting in the transfer of your job overseas.
Training your replacement must take enormous inner reserve.
There’s an IT professional who, at this moment, is training offshore replacements, the people who are taking over the work. This IT pro is also a good writer, and has penned a short explanation about what life is now like.
The name, employer, and everything else will remain anonymous.
The IT worker writes:
“As Americans, we maintain our pride and dignity as we are forced to train our H-1B replacements. We struggle with the reality of having no jobs, but yet we train our replacements without prejudice and hold our heads up high because we are ingrained with a work ethic to do our very best.
We use clichés such as ‘when one door closes, another one opens’ or ‘out of bad something good will happen.’ But the future is uncertain. Emotionally, we are broken. A lot of us suffer from anxiety. Some of us are taking medications for our nerves. But we persist. We go to work every day. We train unskilled H-1B workers day after day. We look to the future, but what does it hold for us?
Does anyone even care anymore? Our elected officials look the other way. There is sympathy and empathy from Americans, but we are lost as to what to do.
How do I get the message out there? I am an American. I am one of you and I have a soul and feelings but I'm helpless if no one hears my message.”

Saturday, April 26, 2014

The choice facing Arabs: integration or irrelevance

By Jamal Kanj
Pity the nation divided into fragments, each fragment deeming itself a nation – Gibran Khalil Gibran.
The United Nations Economic and Social Commission for Western Asia (ESCWA) recently published a study prepared by nearly two dozen writers and intellectuals from the Arab world.
The report, The Arab Integration: A 21st Century Development Imperative, addresses audaciously many of the social, economic and political ills of the Arab world. The more than 300-page report enumerates a litany of futile steps taken in the last 60 years to “integrate” countries in the region.
As an example, in 1957 member states of the Arab League signed a progressive and overarching Economic Unity Agreement (EUA) advocating “free movement of persons and capital; the free exchange of goods and products; freedom of residence, work-free use of modes of transport and civil ports and airports for all Arab citizens”.
In the same year, six European countries established what became known as the Common Market.
More than five decades later and the European nations, which were shaped for the most part by hundreds of years of the most devastating wars known to humanity, have turned their Common Market into a union to be reckoned with.
For the first time, the Arab people have stepped ahead of their leaders, demanding open governance and freedoms on a scale that no single Arab country will be able by itself to provide. (UN Economic and Social Commission for Western Asia)
On the other side, the secretly-crafted 1916 Sykes-Picot Arab states are fragmented further and their 1957 EUA is not even worth the paper it is written on.
In theory and unlike nations within today’s European Union, the Arab world has much firmer unifying attributes like shared language, history and religion. Apparently though, the legacy of war was more merciful than the relics of colonialism when it came to promoting democratic values and integration.
While death and destruction triggered the detoxing of corrupt political systems in Europe, colonialism left behind feeble “unrepresentative Arab regimes that took their legitimacy from international powers and not from the people”.
While the ESCWA study did not overtly call for removing restrictions on movement, it points out that the biggest hindrance to trade between Arab countries are governments’ protectionist measures, “non-tariff barriers and the high cost of transport”.
For instance, the report finds that a modest 5 per cent reduction in the transport cost combined with free movement of Arab labour and local resources “would double the rate of income rise” in the region.
Unsurprisingly, these small steps would bring significant benefits for all countries, not just to the poor at the expense of the rich. In fact, the study argues that rich countries such as the United Arab Emirates “would benefit most” by removing government-imposed restrictions.
Arab states must choose between democracy and integration, or further disintegration along sectorial and tribal allegiances and risk being relegated to the sidelines between major trade hubs to the East and West.
Keeping in mind recent political upheavals, ESCWA conducted public surveys in 15 Arab countries where it surmised that the impetus for political change in the Arab world has passed the point of no return. “For the first time, the Arab people have stepped ahead of their leaders, demanding open governance and freedoms on a scale that no single Arab country will be able by itself to provide.”
Unfortunately, stepping “ahead of their leaders” has not been without the pain of war. The struggle against the Syrian tyrant has turned into an outsider-managed civil war aiming to destroy Syria; the foreign “remote-control” change of dictatorship has fragmented Libya, and Egypt continues to struggle with its democracy.
The ESCWA report concludes with a warning that in the 21st century some of the Arab countries can’t continue to rely on non-sustainable natural resources to survive.
Arab states must choose between democracy and integration, or further disintegration along sectorial and tribal allegiances and risk being relegated to the sidelines between major trade hubs to the East and West.

UK Pensions Exposed Without Diversification To Gold As Pensions ‘Time Bomb’ Looms

by GoldCore
Today’s AM fix was USD 1,294.25, EUR 934.88 and GBP 769.38 per ounce.
Yesterday’s AM fix was USD 1,283.50, EUR 928.53 and GBP 764.26 per ounce.
Gold climbed $8.50 or 0.66% yesterday to $1,292.90/oz. Silver rose $0.24 or 1.24% yesterday to $19.67/oz.

Gold in U.S. Dollars – 5 Days – (Thomson Reuters)
Gold consolidated on yesterdays sharp recovery after a sudden sell off but remained near its weakest level in more than two months. Thursday saw the expiry of US Comex May options and weakness and concentrated selling is often seen on options expiration – indeed, short term bottoms often occur after such bouts of selling.
Increasing tensions between NATO and Russia are underpinning the metal’s safe-haven appeal and leading to safe haven demand.
Ukrainian forces killed up to five pro-Moscow rebels late yesterday and attacked the separatists military stronghold in the east. Russia launched army drills near the border in response, raising fears of a military conflict with NATO.
U.S. Secretary of State John Kerry warned on Thursday that the United States was drawing closer to imposing more sanctions on Russia. He warned that time was running out for Moscow to change its course in Ukraine.
Economic sanctions are likely to see retaliation by Russia and an intensification of currency wars.
European and Asian stocks struggled on Friday, as fears of an escalating Ukraine crisis eclipsed mixed  U.S. economic data and buoyant tech earnings.
Traders are now looking at next week’s U.S. Federal Reserve Open Market Committee’s meeting on interest rates for trading cues.
Premiums for gold bars in Hong Kong were quoted at 80 cents to $1 an ounce to spot London prices, while the premiums for gold bars in Singapore, the increasingly important centre for bullion trading in Southeast Asia, were at $1 to $1.20 to the spot London prices – both mostly unchanged from a week ago.

Gold in U.S. Dollars – 5 Years – (Thomson Reuters)
CME Group Inc plans to launch a physically deliverable gold futures contract in Asia, three sources familiar with the matter said according to Reuters. In the first three months of 2014, U.S. COMEX gold futures volume fell 10% from a year ago. This is partly due to an increased preference by some speculators and investors to own physical gold coins and bars rather than paper gold in the form of futures contracts. The new Asian contract could help boost volumes for CME.
The world’s largest futures exchange is targeting rising hedging, investor and store of wealth demand in Hong Kong and Singapore – Asia’s increasingly important precious metals hubs.
Pensions Exposed Without Diversification To Gold As Pensions ‘Time Bomb’ Looms
The ‘pensions time bomb’ looms: pension funds lack of diversification, and over exposure to traditional assets may cost pension holders dearly according to research we have just released. Pensions allocations to gold are very low internationally and yet gold has an important role to play over the long term in preserving and growing pension wealth.
The Guide To Gold In UK Pensions shows the importance of owning gold as a diversification in a pension in the UK. Allocations to gold in pensions are very low internationally and therefore the research is relevant for pension owners internationally.
Professor of Finance in Trinity College Dublin, Dr Brian Lucey wrote the Foreword  and warned about the lack of diversification in pension funds. “Pensions need balance. UK pension funds have been slow to embrace gold and this imbalance may cost pension holders dearly” said Dr Lucey.
Dr. Brian Lucy
“Small allocations to gold balance and stabilise pensions in the long term and gold should be an essential part of UK pension funds. The Guide To Gold In UK Pensions should be read by pension owners and pension managers,” said Dr Lucey who is a respected independent authority on gold.
British citizens are slowly waking up to the growing pensions crisis. The pension ‘time bomb’  looms closer and millions of people are at risk of having insufficient resources to fund their retirement years.
It is estimated that some 11 million people in the UK face entering “pension poverty.” Average earners may need to save over six times more than they currently do if they’re to generate an adequate retirement income, according to some calculations.
Head of Research in GoldCore, Mark O’Byrne, said that “pension funds should include gold as part of a diversified portfolio. It has a very long track record, and possesses valuable investment attributes. Gold should form part of a diversified pension investment – it will protect from the pensions time bomb.”
Mark O’ Byrne
“Conservative wealth management and asset diversification naturally grow in importance as people get older. Prudent asset diversification will enable pension funds to preserve and grow their pension savings,” according to O’Byrne.
The UK’s financial and economic outlook remains uncertain. “While the UK is recovering, the overall debt to GDP position remains worrisome and there is a real risk of a property bubble in London,” said O’Byrne.
There is also a risk that the state may find it difficult to pay for the massive entitlements of an aging population.
“Today’s uncertain world makes the investment and pensions landscape a more challenging place for pension owners and again underlines the importance of being properly diversified and not having all your eggs in certain assets,” according to O’Byrne.
ConclusionGold is once more being considered as an important asset to have in a properly diversified pension portfolios. Gold plays an important role in stabilising and reducing volatility in the overall portfolio and as financial insurance to protect against worst case scenarios.
These include the risk of inflation and stock and property crashes. Bail-ins or deposit confiscation, as was seen in EU country Cyprus, is a new unappreciated risk to pension owners and another reason to have an allocation to gold.
Currency devaluations as was seen on Black Wednesday in September 1992 when George Soros “broke the Bank of England” is another risk that gold hedges against.
The UK’s influential research institute Chatham House , has said that gold can be used to hedge against currency devaluation and other risks as part of a diversified portfolio. “Gold can serve as a hedge against declining values of key fiat currencies, and can also be useful for central banks looking to diversify their foreign reserves,” Chatham House said.
“As we draw close and closer to the pensions ‘time bomb,’ diversification will become even more important and an allocation to gold in a pension portfolio will again preserve and grow wealth in the coming years,” concluded Dr Lucey.
The Guide To Gold In UK Pensions  can be downloaded here.