ECB Shuts Off Direct Funds to Greece, World Stocks Plunge

(Jeff Black)  The European Central Bank heaped pressure on Greece’s new government by restricting access to its direct liquidity lines, citing concerns about the country’s commitment to existing bailout pledges.
The decision marks an escalating standoff between Greek politicians and other officials in the euro area. It came hours after new Greek Finance Minister Yanis Varoufakis met ECB President Mario Draghi to garner support for his government’s plans to tear up its 240 billion-euro ($272 billion) rescue package and renegotiate the nation’s debt.
“The ECB today decided to lift the waiver affecting marketable debt instruments issued or fully guaranteed by the Hellenic Republic,” the Frankfurt-based central bank said in an e-mailed statement on Wednesday. “The Governing Council decision is based on the fact that it is currently not possible to assume a successful conclusion of the program review and is in line with existing Eurosystem rules.”
Greek lenders, who since 2010 had been able to access funds from the ECB against junk-rated collateral, must now apply for funding from their national central bank at higher rates. While a similar shut-off occurred briefly in 2012, the government and its creditors are this time at odds on how to proceed and the current move risks precipitating a Greek exit from the euro.
The single currency fell after the statement and traded at $1.1339, down 1.2 percent, at 10:59 p.m. Frankfurt time.
Greek government debt currently pledged as collateral under ECB refinancing operations will no longer be eligible as of Feb. 11 when the current operation matures, the ECB said.

Early Move

A Bank of Greece spokesman said that liquidity will continue as normal, as existing ECB financing will be converted into Emergency Liquidity Assistance. The official asked not to be named in line with policy and declined to answer all other questions. A spokesman for the Greek government didn’t respond to two phone calls seeking comment.
The ECB hadn’t publicly signaled that it would take such action so soon. On Jan. 8, the central bank said it would continue the waiver on the assumption that Greece would conclude a review of its current bailout program, and negotiate a successor to it. The existing aid program is scheduled to expire on Feb. 28.
“The ECB’s move is coming a couple of weeks before we anticipated,” Marc Chandler, global head of currency strategies in New York at Brown Brothers Harriman & Co., said in an e-mail. “I imagine Greek bonds and stocks will get hit hard on Thursday.”

‘No Surprises’

Even so, ECB Vice President Vitor Constancio said on Saturday that if a nation has ratings below investment grade, “then a waiver is granted provided that the country is under a program” and that “there will be no surprises if we find out that a country is below that rating and there’s no longer a program that that waiver disappears.”
“This decision does not bear consequences for the counterparty status of Greek financial institutions in monetary policy operations,” the ECB said in its statement. “Liquidity needs of Eurosystem counterparties, for counterparties that do not have sufficient alternative collateral, can be satisfied by the relevant national central bank, by means of Emergency Liquidity Assistance.”
ELA is priced at an annual interest rate of 1.55 percent compared with the current ECB refinancing rate of 0.05 percent, Bank of Greece Governor Yannis Stournaras said in an interview with Kathimerini newspaper in November.

Harder Stance

The ECB also has the power to refuse permission for the Greek central bank to supply funds under ELA, and reviews the procedure every two weeks.
As Greece’s creditors line up to oppose the country’s demand for a debt restructuring, Prime Minister Alexis Tsipras’s refusal to accept more bailout loans may result in a cash crunch as early as next month, two people familiar with the country’s financial position said.
The ECB’s move may be the harbinger of a harder stance by Greece’s European creditors. In order for the government to pay its bills beyond next month, it needs the so-called troika of ECB, European Commission and the International Monetary Fund to agree to lift a 15 billion-euro ceiling on the amount of short-term debt it can issue.

CME closing most of its futures trading pits in NY, Chicago

Tim Boyle | Bloomberg | Getty Images

A trader signals orders on the financial floor at the Chicago Board of Trade in Chicago.

CME Group says it will close most of its futures trading pits in Chicago and New York City by July 2, 2015.

It will maintain its options trading pit and the S&P 500 futures market.
"Equity index futures pits and the DJIA ($10) and NASDAQ-100 options pits will close following the expiration of the June 2015 contract on June 19, 2015," the company said in a release.
CME Group says it will try to offer booth space to those who want to trade electronically following the closures.
Click here for the latest on the markets.

1 in 5 jobs now held by foreign workers… American tech employees forced to train immigrants hired to replace them

Fewer US-Born Americans Have Jobs Now Than In 2007
Fewer Americans born in the U.S. have jobs now than were employed to November 2007, despite a working-age population growth of 11 million.
The amazing drop in employment highlights President Barack Obama’s slow recovery from the deep 2008 shock, but also spotlights many companies’ growing reliance on foreign migrant labor.
Almost one in every two jobs added since 2009 have gone to foreign-born workers.
In November 2014, one in every five U.S. jobs was held by a foreign-born worker, up from one-in-six jobs in January 2010, according to federal datahighlighted by the Center for Immigration Studies.
Since November 2007, the number of working legal and illegal migrants has risen by two million, from 23.1 million in November 2007 to 25.1 million in November 2014.
But the number of Americans with jobs has fallen by 1.5 million, from 124 million in November 2007 to 122.6 million November 2014.
http://dailycaller.com/2014/12/19/fewer-us-born-americans-have-jobs-now-than-in-2007/

American tech employees forced to train immigrants hired to replace them
Information technology workers at Southern California Edison (SCE) are being laid off and replaced by workers from India. Some employees are training their H-1B visa holding replacements, and many have already lost their jobs.
The employees are upset and say they can’t understand how H-1B guest workers can be used to replace them.
The IT organization’s “transition effort” is expected to result in about 400 layoffs, with “another 100 or so employees leaving voluntarily,” SCE said in a statement. The “transition,” which began in August, will be completed by the end of March, the company said.
“They are bringing in people with a couple of years’ experience to replace us and then we have to train them,” said one longtime IT worker. “It’s demoralizing and in a way I kind of felt betrayed by the company.”
SCE, Southern California’s largest utility, has confirmed the layoffs and the hiring of Infosys, based in Bangalore, and Tata Consultancy Services (TCS) in Mumbai. They are two of the largest users of H-1B visas.
http://www.computerworld.com/article/2879083/southern-california-edison-it-workers-beyond-furious-over-h-1b-replacements.html

Past Bush Comments Shock Conservatives:
http://www.cnn.com/2015/02/04/politics/bush-immigration-conservatives-detroit/

‘Not possible’ to ‘completely control border’…
http://www.cnn.com/2015/02/04/politics/bush-immigration-conservatives-detroit/

‘Repopulate’ Detroit with immigrants…
http://www.cnn.com/2015/02/04/politics/bush-immigration-conservatives-detroit/
‘Ridiculous’ not to give ‘accelerated citizenship’ to young illegals…
http://www.cnn.com/2015/02/04/politics/bush-immigration-conservatives-detroit/

Under The New World Order

Under The New World Order

Greece Softening On EU Exit Hurts Safe-Haven Gold Bid – Peter Hug | Kitco News

Gold is under pressure early this week as Peter Hug takes a look at why, on this edition of For Pete’s Sake! Touching on Greece’s newly elected left-wing government, Hug points out that the safe-haven bid has been taken out of gold a little bit, due to the party’s recently softened stance on distancing itself from the EU. “Greece seems to be backing away from its aggressive stance and they’re trying to negotiate some type of package that would allow them to be less austere, but at the same time stay within the EU,” he says. Hug also touches on whether or not gold prices are lacking fresh bullish news, how the markets misread the Fed’s – deemed hawkish – meeting and whether gold prices will be stuck in a range for the next little while. Kitco News, February 3, 2015.

World Heading For Financial Crisis Worse Than In 2008

Primo Piatto Et Secondo Piatto:
I have been suggesting for quite some time that what we saw in 2008 was just the appetizer ahead of the main course.   Globally, including and especially in the U.S., the level of debt and derivatives stashed way on big bank, hedge fund and financial firm (insurance companies, mutual funds, public pension funds) balance sheets is staggering.  Multiples of what it was in 2008.
Fuses have been lit all over the globe, including crashing currencies, collapsing industries (think:  oil shale/fracking) and de facto defaulting sovereign debt.  Even the U.S. Government has de facto defaulted on its debt because the only way it makes payments are via money printing and forced rollover by existing holders.
The head of China’s Dagong Rating Agency has finally stated the obvious in a public forum:

I believe we’ll have to face a new world financial crisis in the next few years… the situation is even worse than ahead of 2008.

You can read the article here:   LINK

GDP Growth Slows Sharply in 4th Quarter: 2015 to be Worse

Staples to acquire Office Depot for $6.3 billion

(Sarah Halzack)  Staples announced Wednesday that it will acquire Office Depot for $6.3 billion, a move that underscores how much harder it’s getting to make a big-box store viable in the e-commerce era.
The deal comes as the retailers are seeing massive upheaval in their industry: Demand for paper-based office supplies is dwindling as more business functions become digital, and a diverse array of competitors, including Amazon and Wal-Mart, are selling these kinds of goods.
With their sprawling square footage, big-box stores typically have very expensive leases and require a large staff, expenses that are harder to grapple with as more shoppers move online. The math eventually didn’t work for onetime big-box giants such as Circuit City, Linens ‘N Things and Borders.  Even giants such as Wal-Mart and Target, while sticking with their big-box formats, are looking to smaller-format versions of their stores for future growth.
Staples chief executive Ron Sargent said Wednesday that a merger would help the brands compete more effectively.
“I think this is kind of a historic opportunity to reset pricing,” Sargent said Wednesday morning on a conference call with investors, a signal that the merged companies would aim to compete more aggressively on price with Amazon. Together, the brands would have about $39 billion in annual sales and about 4,000 stores.
The companies said that they expect to dramatically cut costs on advertising, marketing and administrative functions if the merger is completed.
“We expect to recognize at least $1 billion of synergies as we aggressively reduce global expenses and optimize our retail footprint,” said Sargent. “These savings will dramatically accelerate our strategic reinvention, which is focused on driving growth in our delivery businesses and in categories beyond office supplies.”
Both stores say they plan to continue with previous plans to close some of their outposts. Staples said last year it would close 225 of its stores by mid-2015; Office Depot has said it would close 135 stores this year. While executives did not say exactly how the proposed merger would affect their store count, they said that about half of Staples stores are within five miles of an Office Depot store, giving them good reason to rethink the quantity and location of many of their outposts.
The companies said their talks began in September and that they hope to complete the merger by the end of 2015.  The proposal is awaiting the review of federal regulators, who blocked a merger between the retailers nearly two decades ago.  Still, Office Depot was permitted to buy OfficeMax in 2013, a signal that the emergence of new e-commerce players in the office supplies market may have changed the way such a deal would be viewed.
“It’s really not our place, nor could we even possibly handicap what the FTC might say,” Sargent said.
Staples says much of its revenue –46 percent last year — came from products that were not office supplies, and they expect that share to grow to 48 percent this year.  In other words, Staples, too, is a much different store than it was the last time the FTC weighed a potential merger.
Executives said they plan to keep Staples’ headquarters in Framingham, Mass., and “plan to evaluate maintaining a presence” in Boca Raton, Fla., where Office Depot’s headquarters are located. Sargent is to be the chief executive of the merged companies.

Man killed himself after benefit changes left him owing £800, inquest told

Malcolm Burge, 66, had previously written to Newham Council telling them he was 'depressed, stressed and suicidal' because of the demand

A retired gardener took his own life after begging for help when changes to his benefits left him owing more than £800 – in a case that highlights the bureaucratic cruelty of the welfare system.

Malcolm Burge, 66, killed himself at Cheddar Gorge, Somerset, after being pursued for the sum by his local authority, an inquest into his death has heard.
He had previously written to Newham Council telling them he was “depressed, stressed and suicidal”.
“I have no savings or assets. I am not trying to live, I am trying to survive. I can’t remember the last time I had £800.”
West Somerset Coroner Michael Rose said he would write to Newham Council to encourage them to establish a system to help the “most vulnerable” residents deal with the benefits system, after examining the case of the pensioner, who took his own life on 28 June last year.
Letters presented to the inquest revealed Mr Burge had tried repeatedly to seek help and telephone the council but had been bounced around an electronic switchboard.
Government changes to welfare in January 2013 meant his weekly housing benefit, paid by Newham, should have been slashed from £89.39 to £44.75 – but this was not implemented due to a “backlog” at the authority. Mr Burge continued to receive the higher amount – and was shocked when the authority issued a demand for an £809.79 overpayment.
Describing the case as “tragic”, the coroner said: “Mr Burge had obviously been caught up in the change of the benefits system. In fairness to the council they have admitted failure due to a backlog.”
Mr Rose continued: “People of this age don’t always have laptops or iPads and can’t use the internet. It is almost an excuse now to ignore one’s responsibilities and say ‘look up the website’.”
In his ruling Mr Rose criticised the response of Newham Council, which sent 10 letters asking for the money. “They didn’t fully address Mr Burge’s queries and their tone was not appropriate,” he said. “It seems clear he was a man who needed help and was in distress. Unfortunately, Newham Borough Council were unable to give it to him.
“There was no deliberate attempt to avoid payment, he was overwhelmed by the sum. The council were overwhelmed by the number of cases that they had.” The coroner concluded that Burge had taken his own life.
Mr Burge’s niece Sharon Watts said the man had lived in the City of London cemetery with his parents throughout his life. In 1992 his mother died and so Mr Burge became a full-time carer for his father. “He devoted his entire life to helping his father,” Mrs Watts said. “None of us knew. His pride kept him away from asking us and we would have helped him.”
A Newham Council spokesperson said: “Our thoughts are with the family and friends of Mr Burge. In our submission to the coroner, we acknowledged delays and deficiencies in our extensive correspondence through letters and phone calls with Mr Burge. We are sorry if this contributed to his death in any way.”
Suicide is a preventable cause of death and anyone who feels they may be at risk should contact The Samaritans on 08457 90 90 90.

1929: recession->depression-> currency war->trade war->world war. Sound familiar?

ECB Money Printers At Work: As Europe Slides Into Recession—–Lending Standards Keep Deteriorating
For the first time in thirty-five months, overall lending in Europe was higher year-over-year. Not since January 2012 had that been the case, as shrinking in lending was a de facto monetary limit on where the ECB wants the European economy to go. And while one month is not necessarily the start of a durable trend, indications had been for some time that total lending activity had at least been flattening out after the long decline.
image: http://www.alhambrapartners.com/wp-content/uploads/2015/02/ABOOK-Feb-2015-Europe-Lending.jpg
While we don’t know for sure how much the T-LTRO’s had as an effect on any net increase in lending, however tiny, the disappointment over the takeups in September and December does not mean there was no effect at all. And that is precisely the problem, as the monetary pathway for all of this monetarism is intended to ease any restraints on lending as if restraint were everywhere and always a negative outcome. In other words, the ECB practically begged banks to lend, to the tune of hundreds of billions in indirect funding, including €212.44 billion in T-LTRO’s cumulative, interbank rates persistently below zero, yield curves collapsed everywhere and the result was December 2014 lending was just €5.1 billion above December 2013.
http://davidstockmanscontracorner.com/ecb-money-printers-at-work-as-europe-slides-into-recession-lending-standards-keep-deteriorating/

Currency Wars Heat up as Central Banks Race to Cut Rates
The Chinese Year of the Ram will kick off at the end of this month, but for now it looks as if 2015 will be the Year of the Central Banks.
I spend a lot of time talking about gold, oil and emerging markets, and it’s important to recognize what drives these asset classes’ performance. Government and fiscal policy often have much to do with it. But in the past three months, we’ve seen central banks take center stage to engage in a new currency war: a race to the bottom of the exchange rate in an attempt to weaken their own currencies and undercut competitor nations.
Indeed, amid rock-bottom oil prices, deflation fears and slowing growth, policymakers from every corner of the globe are enacting some sort of monetary easing program. Last month alone, 14 countries have cut rates and loosened borrowing standards, the most recent one being Russia.
A weak currency makes export prices more competitive and can help give inflation a boost, among other benefits.
“The U.S. seems to be the only country right now that doesn’t mind having a strong currency,” says John Derrick, Director of Research here at U.S. Global Investors.
Since July, major currencies have fallen more than 15 percent against the greenback.
image: http://67.19.64.18/news/2015/2-3fh/image002.png
http://news.goldseek.com/GoldSeek/1422975900.php

Gregory Mannarino: Cracks in the Debt Bubble – World War III has Started

“This is being done on purpose to punish the Russian economy. This is economic warfare 101, and it’s going to lead to a shooting war. Not only is it going to lead to a shooting war, this is the grand plan…What people need to understand is the collapse is here now. World War III has started, so this is it people. There is no more waiting.”

Four Trade War Questions; PMI Reports; Currency Manipulation Chargeshttp://globaleconomicanalysis.blogspot.com/2015/02/four-trade-war-questions-pmi-reports.html#hfec9hOVdEhSAfbU.99
“A trade war brewing between India & the US?
http://www.livemint.com/Opinion/JJtdXFRyKSf87rTIQQoAKP/A-trade-war-brewing.html
S**t is getting real…this is the start of a trade war. NYT: New Rules in China Upset Western Tech Companies
http://www.nytimes.com/2015/01/29/technology/in-china-new-cybersecurity-rules-perturb-western-tech-companies.html
Superpowers Battle Over Greece As Europe Trembles With Fear Of World War III
http://kingworldnews.com/superpowers-battle-greece-europe-trembles-fear-world-war-iii/
U.S. Gov/Central Bankers Are Accelerating War To Cover Up The Economic Collapse

 

The Parasite Economy

Government handouts make parasites out of many of us.

 

Politicians and lawyers pretend that they are important people doing important work. But often they're important because they are parasites. They feed off others, while creating no wealth of their own.

We all complain about businesses we don't like, but because business is voluntary, every merchant must offer us something we want in order to get our money. But that's not true for politicians and their businessman cronies. They get to use government force to grab our money.
Those people who take instead of producing things make up "the parasite economy," says Cato Institute Vice President David Boaz. It's my favorite chapter in his new book, The Libertarian Mind. The parasite economy, says Boaz, thrives wherever "you use the law to get something you couldn't get voluntarily in the marketplace."
That includes much of the military-industrial complex, "green" businesses that prosper only because politicians award them subsidies, banks that can borrow cheaply because they're labeled "too big to fail," and—unfortunately—me.
All of us are parasites if government granted us special deals. Some parasites (not me) lobbied for their deal. "You might use a tariff to prevent people from buying from your foreign competitors or get the government to give you a subsidy," says Boaz. "You might get the government to pass a law that makes it difficult for your competitors to compete with you."
This quickly creates a culture where businesses conclude that the best way to prosper is not by producing superior goods, but by lobbying. Politicians then tend to view those businesses the way gangsters used to view neighborhood stores, as targets to shake down.
Says Boaz, "You have politicians and bureaucrats and lobbyists coming around to these companies and saying, hey, nice little company you've got there, too bad if something happened to it. ... They start suggesting that maybe you need to make some campaign contributions, maybe hire some lobbyists, and maybe we'll run an anti-trust investigation, and maybe we'll limit your supply of overseas engineers. And all of these things then drag these companies into Washington's lobbying culture."
And as I mentioned, it's not just companies that get dragged in. I built a house on the edge of the ocean. People weigh the costs and benefits of building in risky places like that. Without government's encouragement, I would have just built someplace else. But because politicians decided that government should be in the flood insurance business, and then other politicians decided that government's insurance business should offer cheap rates, I did build on the beach.
Even though my property was obviously a high flood risk, my insurance premiums never exceeded $400 a year. Ten years later, my house washed away, and government's insurance plan reimbursed my costs. Today, the federal flood insurance program is $40 billion in the red.
In other words, you helped pay for my beach house. Thanks! I never invited you there, but you paid anyway. I actually felt entitled to the money. It had been promised by a government program! But it was wrong, and I won't collect again. I don't want to be a parasite.
But it's tough, because government keeps making offers. Government handouts make parasites out of many of us.
Compare politicians and politicians' cronies to tapeworms and ticks. Like parasites in nature, the ticks on the body politic don't want to kill the host organism—meaning us. It's in politicians' and regulators' interest to keep the host alive so they can keep eating our food and sucking our blood.
After watching members of Congress applaud President Obama during his last State of the Union address, I came to think that politicians were worse than tapeworms and ticks. The president bragged about American energy production being up. Domestic energy is up, but it's up because of private sector innovation, not government. In fact, it's up in spite of administration rules that make it harder to extract oil from public lands. Yet many in Congress applauded the president's misleading claim.
At least tapeworms and ticks don't expect us to clap.

How Uncle Sam Became a Bank Robber

Civil forfeiture and money laundering laws let the IRS seize the accounts of legitimate businesses.

During her confirmation hearings last week, Loretta Lynch, President Obama's choice to succeed Eric Holder as attorney general, called civil forfeiture, a form of legalized theft in which the government takes people's property without accusing them of a crime, "a wonderful tool." Lynch, currently the U.S. attorney for the Eastern District of New York, suggested that innocent owners need not worry about getting hammered by this tool, because forfeiture "is done pursuant to supervision by a court," and "the protections are there."

In light of a forfeiture case that Lynch's office had abruptly dropped the previous week, her assurances rang hollow. The case, involving $447,000 that the government stole from a Long Island business and sat on for nearly three years, illustrates the injustice inflicted by seizures in which a "crime" that harms no one becomes an excuse for bank heists that enrich the agencies perpetrating them.
Since 1970 the humorously named Bank Secrecy Act has required financial institutions to report deposits of $10,000 or more to the Treasury Department, because such large sums of cash are obviously suspicious. You know what else is suspicious? Deposits of less than $10,000, because they suggest an attempt to evade the government's reporting requirement, which has been a federal crime, known as "structuring," since 1986.
In 2012 a Nassau County, New York, detective decided the banking records of Bi-County Distributors, a family-owned business that sells cigarettes and candy to convenience stores, were "consistent with structuring." That judgment was enough to trigger an IRS seizure of all the money in the account, which caused an immediate financial crisis for Bi-County's owners, brothers Jeffrey, Richard, and Mitch Hirsch. 
For the next 32 months, the Hirsches struggled to keep their business afloat, relying on credit extended by longtime vendors. In all that time, the brothers never got a hearing before a judge. Instead they received a series of offers from Lynch's office, which refused to give the money back but said the Hirsches could have part of it if they surrendered the rest.
In the end, with her confirmation hearings looming and the case generating negative publicity, Lynch agreed to return all the money. "Nobody in America should have to live through the nightmare we've experienced," says Jeffrey Hirsch. "Civil forfeiture nearly destroyed our business, even though we did nothing wrong."
The Bi-County case is by no means unique. The Institute for Justice, which represented the Hirsches, has lent its pro bono assistance to several other owners of cash-intensive businesses who inadvertently aroused the government's suspicion by making insufficiently large deposits, including an Iowa restaurateur and a Michigan grocer.
In all of these cases, there was no evidence that the money came from illegal activity, that the business owners were deliberately trying to hide their deposits, or that they knew doing so was illegal. Yet under civil forfeiture rules, their frequent deposits below the $10,000 threshold supplied "probable cause" to seize their hard-earned money.
From 2005 to 2012, according to a new report from the Institute for Justice, the IRS seized $242 million based on suspected structuring in more than 2,500 cases. During that period, the number of cases rose fivefold and revenue increased by 166 percent, but the gap between the amount seized and the amount ultimately forfeited also grew, suggesting the IRS has becoming increasingly reckless with the rights of innocent owners.
After The New York Times started asking questions about these money grabs last October, the IRS said it "will no longer pursue the seizure and forfeiture of funds associated solely with 'legal source' structuring cases unless there are exceptional circumstances." Legislation introduced last week by Sen. Rand Paul (R-Ky.) offers a more reliable solution, requiring prompt probable-cause hearings for people whose money is seized and allowing forfeiture only when they "knowingly" sought to avoid bank reports of "funds not derived from a legitimate source."
Contrary to Lynch's assurances, the protections are not there. But they could be.

 

More Greeks Approve Of Russia's Leadership Than Europe's

You know Merkel, Draghi, Dijsselbloem et al. have a problem when... More than one in three Greeks (35%) in 2014 approved of Russia's leadership, while fewer than one in four (23%) approved of the EU's leadership.


As Gallup reports,

Greeks' higher approval ratings may reflect the cultural, religious and economic ties that Greece has enjoyed for years with Russia, one of the country's major trading partners. But they also echo Greeks' strong displeasure with the EU's leadership, which they are more likely to have an opinion about than Russia's. Nearly as many Greeks have no opinion of Russia's leadership (30%) as approve (35%) or disapprove (35%).

*  *  *
It would appear the people will not be too pupset should the Putin Pivot provide the next level of financial aid?

Germany's worst nightmare has come true

The Germans never wanted the single currency in the first place - they knew what it would lead to 

It’s Germany’s worst nightmare. Increasingly isolated, ganged up on, and even hated by much of southern Europe, it is fast losing the argument over the future of the euro.

Even the Governor of the Bank of England, Mark Carney, has been at it. This week he joined in the German bashing with a full-frontal attack on Berlin’s austerity agenda. And it’s causing confusion, dismay and resentment in equal measure in this most stable, disciplined and civilised of nations.

To understand the decisive shift in narrative that has taken place in Europe over the last couple of weeks – from the defeat Germany has suffered at the hands of the European Central Bank, to the Syriza victory in Greece and its demands for debt forgiveness – you have to go back to the euro’s origins and Germany’s place in it.

Germans never wanted the single currency in the first place, for like Britain, they instinctively understood where it would lead – to a fiscal, or transfer, union which Germany, as Europe’s dominant economy, would be forced to bankroll. If given a referendum, they’d have said no.

But European monetary union was the price Germany had to pay for reunification; it was a way, other European nations naively believed, of containing the newly enlarged country and ensuring that it was properly integrated into the rest of Europe. To them, it seemed the answer to Europe's historic problem - Germany was too large and economically powerful ever to be properly defeated, but the potential threat it poses to the rest of Europe could perhaps be defused through economic integration. Most Germans, now a peace loving people, broadly go along with this "solution" to the problem. The point of dispute is rather about the degree of integration.

To buttress itself against economic pollution from the south, Germany surrounded the new currency and its institutions with safeguards. Fiscal and monetary transfers between nations were specifically banned, and rules were put in place that would supposedly ensure fiscal discipline. None of them has proved equal to the task, and none of them is ultimately compatible with a single currency that actually works.
Since the onset of the financial crisis, Germany has suffered one defeat after another. Every line in the sand has been breached, culminating last week in the Bundesbank’s failure to block ECB money printing, a remedy which may or may not have some merit for the beleaguered economies of the south but is culturally anathema to Germans as well as largely inappropriate for their economy. It's also a money transfer by the backdoor.
The bottom line is that the single currency hasn’t worked for anyone. It’s proved as unsatisfactory for Germany as it has for Greece, Spain and Italy. Happy families are all alike, begins Tolstoy’s Anna Karenina; every unhappy family is unhappy in its own way. The observation could have been written for Europe’s experiment in monetary union.
If something cannot go on forever, it will stop. So said Herb Stein, one time economic adviser to President Richard Nixon. So far, the euro has defied this truism. Unsustainable it may be, but the single currency has also proved remarkably resilient. Despite the damage, nobody wants to give it up, including the Germans, who grudgingly admit to a huge export dividend from participation. What’s more, the last thing Berlin wants is to be seen as blowing up Europe for the third time in a century.
War guilt ensures that Germany will not be the first to pull the plug. Somehow, it has to try to make it work. Berlin is therefore doomed to persist with a project which fundamentally Germans don’t want and has caused economic ruin throughout much of the rest of Europe.
By the by, Germans again find themselves depicted as the Continent’s bad guys, with the new Greek government demanding reparations for wartime afflictions and repeatedly reminding Germany of the hypocrisy of its position by pointing to its history as a serial defaulter. A currency meant to unite Europe has only further divided it.
From the start of the crisis it has been obvious to all dispassionate observers that it can only really end in two ways. Either the eurozone must move rapidly towards the sort of transfer union which Germany has spent the last 15 years resisting, or it must be reconstituted in more sustainable form – that is the monetary separation of Germany and its satellites from the less competitive south, arguably including France.
European elites have been in a state of denial about this choice, with their response to the crisis characterised by grudging incrementalism. There are too many egos, too many careers and too much vested interest bound up in it all to admit the reality.
Now up pops little Syriza to speak truth to power. Whatever you might think about Syriza’s substantially unrealistic economic agenda, and its apparent love affair with the brutish Vladimir Putin, on monetary union at least, its leaders have told it as it is.
“The eurozone is going to be toast within a couple of years”, says Greece’s new finance minister, Yanis Varoufakis, unless it can create “shock absorbers and what I call surplus recycling mechanisms”. No monetary union that demands its debtor nations constantly shrink their economies in order to keep up with the repayments can last for long. The current situation is indeed a form of debtors prison, and a completely counter-productive one, for if you deny the debtor the ability to work off his debts, he'll never repay them anyway.
Germany as much as Greece - virtually the whole of Europe, managed to deceive itself when the euro was formed. Everyone feels bruised and wronged by the experience. To blame disciplinarian Germans is as pointless as profligate Greeks. It is half-formed monetary union which is the problem, not the wicked Germans, and it has proved a catastrophe for all involved. The more important question now is whether unwinding it would be an even greater one, or whether something more durable might be salvaged from the wreckage. The geo-political stakes are as important as the economic ones. If Greece is thrown to the wolves, what does that mean for a country with a history of military coups? What does it mean for democracy, and for Europe's already ineffectual role as a buttress against Putin's imperial ambitions? Germany has some big decisions to make.

 

Fed TRAPPED as QE Fails! Congress Discuss NOT Bailing Out Pension Funds!

Sources:
“Economy grew 2.6% in the fourth quarter”
http://www.usatoday.com/story/money/b…
“Q. and A. With Charles Plosser of the Fed: Raise Rates Sooner Rather Than Later – NYTimes.com”
http://www.nytimes.com/2015/01/30/ups…
“You need to make $108,092 a year to live comfortably in D.C., report says – The Washington Post”
http://www.washingtonpost.com/news/lo…
“Salary it takes to live comfortable in these expensive cities”
http://data-wrapper.s3.amazonaws.com/…
H Res 41 pension fund
http://www.gpo.gov/fdsys/pkg/BILLS-11…
“Eurozone alarm grows over Greek bailout brinkmanship”
http://www.cnbc.com/id/102387514#.
shanghai composite index stock market crash collapse
http://www.zerohedge.com/sites/defaul…
brazil economy growth deflation inflation http://www.zerohedge.com/sites/defaul…
http://www.zerohedge.com/sites/defaul…

Think Greece is in a mess? Wait till the UK's debt mountain explodes in our face

Would we cope with misery as well as the Greeks? If our great fat cushion of state-backed jobs, welfare payments, tax credits and easy loans were whipped away one morning, how would we get on?

I think we would do very badly. In Greece, the suddenly poor and destitute turned to their strong extended families. 

And if those families had not taken them in and supported them, there would have been nothing else. Fortunately, they did.

Scroll down for video 

+3

A woman celebrates the election of the Syriza party in Greece this week which has vowed to put an end to the austerity measures which have punished the Greek people

This country doesn’t have strong extended families any more. In many cases, it doesn’t really have families at all. 

In too many places, it has gangs instead. And those that survive are weakest just where they would be needed most in a crisis – among the poor.

This country lives on the edge of serious disorder. The misnamed ‘riots’ of August 2011 were nothing of the kind. 

They had no political pretext, no wider aim. I suspect many thought of joining in, but didn’t quite.

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They followed the realisation by a large number of people, in a period of good weather, that the forces of order were weak, absent and afraid. Many of them were laughing as they stole, wrecked and burned.

Mostly, they turned on shops rather than private homes or individuals. But this seems to have been a matter of chance. 

There were one or two especially frightening moments when the lawless mob came into direct contact with the cosseted middle class, who hid from their hooded attackers under restaurant tables while the kitchen staff, ready to defend their livelihoods with force, beat off the assault with rolling pins.

And almost all of the looters got away with it. It was only the dim stragglers who were caught and whom I watched shuffling through the courts in the weeks afterwards, most of them with criminal records nearly as long as a Hilary Mantel historical novel. 

+3

Alexis Tsipras, the new Greek Prime Minister, has vowed to put an end to savage state cuts by renegotiating debt repayments with the EU

Newly-elected Greek PM promises 'radical change' in first speech

They were baffled to find that, after years of cautions, unpaid fines, suspended sentences, community service and limp rebukes, something might actually now happen to them. 

Actually, not much did in the end.

That’s bad enough. But what about the rest of us? Generations of all classes have been taught to expect a comfortable, well-fed existence, a reliable safety net. 

How much privation would it take to turn us into beggars, then looters and food rioters? I ask this because we are much closer to a Greek-style crisis than we think.

Our debts, national and personal, are huge. We can never pay them off. Our trade imbalance is just as bad. Our recovery is based entirely on a house-price balloon that could burst in a moment. 

The main effort of the Government is to avoid any shocks until the Election is over – but what then?

I feel for the Greeks. I don’t blame them for refusing to endure more collective punishment, though they were foolish – as we are now – to let politicians lead them into a swamp of debt. 

But I wonder whether, not far hence, it will be the Greeks who are sympathising with us.

 

The riddle behind our Gaddafi disaster

+3

Gaddafi was overthrown because Cameron lent the RAF to little-known ihadi groups, and they have now turned the country into a war zone

Last week, the BBC rightly but cruelly replayed David Cameron’s ludicrous words from September 2011, when he went to Tripoli to say: ‘Your city was an inspiration to the world as you overthrew a dictator and chose freedom.’

Now it’s an inspiration to nobody. He can’t go there to say so, because it’s too dangerous. Why isn’t he in more trouble over his active destruction of an entire country? It’s all very strange. 

The Gaddafi regime fell because Mr Cameron lent the RAF to various gangs of Libyan jihadis (about whom we knew nothing). 

But less than a year before, in October 2010, Henry Bellingham, a Tory Minister, was referring to Gaddafi as ‘Brother Leader’ at a summit in Tripoli.

About the same time, another Minister, Alistair Burt, told the Libyan-British Business Council that Libya had ‘turned a corner’ which ‘has paved the way for us to begin working together again’. 

What changed? Could it be the same forces which decreed that flags in Britain should fly at half-mast to mark the death of King Abdullah of Saudi Arabia? 

The Saudis always hated Libya’s dictator because he had overthrown a dynasty very like their own.

Do we still have an independent foreign policy, or is it governed by another, richer country?

 

Robots are no match for the most beautiful machines of all...

Some of the best films of modern times feature lifelike robots. 

The latest, Ex Machina, starring Alicia Vikander, right, is a clever and cunning mystery story which I’ll say as little about as possible in case it spoils the ending.

But, as I discovered on a recent visit to a Tokyo robotics expert, we are far, far away from developing anything remotely like a human consciousness, let alone a human ability to move limbs and experience pain, pleasure or grief.

The real wonder in our midst is the astonishing complexity, beauty and mystery of the human body, and the insoluble puzzle of where and what consciousness is. 

We fantasise about creating human-like robots because it helps us close our minds to some of the strongest evidence for the existence of God – an idea we dislike.

 

My local police force, Thames Valley, has recently admitted (thanks to a Freedom of Information request) that 54 of its officers, some of them specials, have criminal convictions, including for burglary, arson, drug possession, actual bodily harm, criminal damage and computer misuse. 

I expect other forces have similar numbers. Are the police really so short of recruits that they cannot find people without such pasts? 

Forgiving and forgetting is all very well, but these are the people who come into the homes of burglary victims, and whom we trust absolutely with highly personal details. 

 

Those who rely on the medical profession’s wisdom should note that the National Institute for Health and Care Excellence now says 1.2 million people may have been misdiagnosed with asthma. 

I’m glad someone has noticed the absurd keenness of doctors to classify healthy children as asthmatics. 

How long before they notice that something similar may be happening with some other fashionable ailments, such as the non-existent complaint ‘ADHD’? 

Or will the fact that huge drug contracts rely on these subjective diagnoses protect them from watchdogs? 

 

Have you noticed that the people most excited about women bishops in the Church of England are those who don’t believe in God and never go near a church? 

Personally, I couldn’t care less what sex a bishop is. I’d like it if they believed in God, preferred poetry and beauty to banality, and didn’t mix up Christianity with socialism. 

Perhaps I should start a campaign. 

Croatia just canceled the debts of its poorest citizens

(Rick Noack)  Starting Monday, thousands of Croatia’s poorest citizens will benefit from an unusual gift: They will have their debts wiped out. Named “fresh start,” the government scheme aims to help some of the 317,000 Croatians whose bank accounts have been blocked due to their debts. Given that Croatia is a relatively small Mediterranean country of only 4.4 million inhabitants, the number of indebted citizens is significant and has become a major economic burden for the country. After six years of recession, growth predictions for Croatia’s economy remain low for this year.
“We assess that this measure will be applicable to some 60,000 citizens,” Deputy Prime Minister Milanka Opacic was quoted as saying by Reuters. “Thus they will be given a chance for a new start without a burden of debt,” Opacic said earlier this month.
To be eligible, Croats need to fulfill certain criteria: Their debt must be lower than 35,000 kuna ($5,100), and their monthly income should not be higher than 1,250 kuna ($138). Those applying for the scheme are not allowed to own any property or have any savings.
Among economists, the scheme is regarded as unprecedented and exceptional. “I can’t think of anything comparable,” Dean Baker, co-director of the Washington-based Center for Economic and Policy Research, told The Washington Post.
Although the program is expected to cost up to 210 million Croatian kuna ($31 million), according to Austrian press agency APA, the Croatian government expects economic long-term benefits that will outweigh the short-term investment. Prime Minister Zoran Milanovic has convinced multiple cities, public and private companies, the country’s major telecommunications providers, as well as nine banks to clear some of their citizens of their debt. The government will not refund the companies for their losses.
Overall, the debt of all Croats amounts to $4.11 billion — and the debt that is about to be wiped out accounts for less than 1 percent of that. However, for those who are eligible the agreement will make a significant difference by enabling them to gain access to their bank accounts. By reducing debt by less than 1 percent, Croatia frees nearly 20 percent of the country’s debtors from their obligations.
Some economists, among them Baker, are skeptical whether the scheme will succeed: “I am not sure that this is the best way to help low-income people. If lenders think this can happen again they will charge very high interest rates to low-income borrowers,” Baker said.

Did The Federal Reserve Make A Major Math Error When Reporting Its December Gold Withdrawals?

A month ago, when we first observed the biggest monthly gold repatriation from the NY Fed since 2001, when 47 tons of foreign-owned gold were withdrawn from the vault below 33 Liberty street which lowered the gold inside to just 6,029 tons, and which brought the 2014 YTD total withdrawal to 166.5 tons, we noted a math anomaly when accounting for the previously reported 122 tons of gold withdrawn by the Netherlands:

net of the Netherlands withdrawals, there is some 44 tons of extra gold that has been also quietly redeemed (by another entity). The question is who: is it now the turn of Austria to reveal in a few weeks that it too, secretly, withdrew some 40+ tons of gold from "safe keeping" in the US? Or was it Belgium? Or did the Dutch simply decide to haul back some more. Or did Germany finally get over its "logistical complications" which prevented it from transporting more than just a laughable 5 tons in 2013? And most importantly, did Germany finally grow a pair and decide not to let "diplomatic difficulties" stand between it and its gold?

Ironically, less than three weeks later, our bolded speculation above was proven to be absolutely correct when Germany confirmed that not only had it resumed repatriating its gold from the NY Fed as originally announced two years ago, after the mere 5 tons of gold transported to Frankfurt in all of 2013, but had substantially picked up the pace, when on January 19 the Bundesbank reported that it had indeed "grown a pair" and repatriated 35 tonnes of gold from Paris and, more importantly, 85 tonnes of gold from the NY Fed in all of 2014.
This is what Buba said:

The Bundesbank successfully continued and further stepped up its transfers of gold last year. In 2014, 120 tonnes of gold were transferred to Frankfurt am Main from storage locations abroad: 35 tonnes from Paris and 85 tonnes from New York. "Implementation of our new gold storage plan is proceeding smoothly. Operations are running very much according to schedule," said Carl-Ludwig Thiele, Member of the Executive Board of the Deutsche Bundesbank.

The Bundesbank took advantage of the transfer from New York to have roughly 50 tonnes of gold melted down and recast according to the London Good Delivery standard, today's internationally recognised standard. "We also called on the expertise of the Bank for International Settlements for the spot checks that had to be carried out. As expected, there were no irregularities," said Mr Thiele.

According to its new gold storage plan, unveiled in January 2013, the Bundesbank will be storing half of Germany’s gold reserves in its own vaults from 2020 onwards. This necessitates a phased transfer to Frankfurt am Main of 300 tonnes of gold from New York and all 374 tonnes of gold from Paris.

Since the transfers began in 2013, the Bank has relocated a total of 157 tonnes of gold to Frankfurt am Main - 67 tonnes from Paris and 90 tonnes from New York. This is equivalent to roughly 23% of the total quantity to be transferred. The following table gives an overview of the gold that has been transferred to date.



As at 31 December 2014, the Bundesbank's gold reserves were stored at the following locations.

The Bundesbank assures the identity and authenticity of German gold reserves throughout the transfer process - from when they are removed from warehouses abroad until they are stored in Frankfurt am Main. As soon as the gold was removed from the warehouse locations abroad, Bundesbank employees cross-checked the lists of bars belonging to the Bundesbank against the information on the bars removed. Finally, once they arrived in Frankfurt am Main, all the transferred gold bars were thoroughly and exhaustively inspected and verified by the Bundesbank. When all the inspections had been concluded, no irregularities came to light with regard to the authenticity, fineness and weight of the bars.

At the time we commented that there was "a curious amount of precautions and safeguards when transporting the "safe" and "untainted" gold held at the NY Fed to Frankfurt. Almost as if the Bundesbank, gasp, did not trust the quality and content of the NY Fed-held gold, nor its well-meaning intentions."
Judging by the latest disclosure by the NY Fed, Buba may have had good reason to be "concerned" about its gold at the Fed, because according to the Fed's latest update of "earmarked gold" for December there was yet another math anomaly.
Whereas in November, the cumulative total correctly hinted that there was more withdrawals than had been disclosed, the December 2014 total suggests that either the Fed just made an egregious math error, one costing literally about $1.1 billion, when keeping track of its entrusted physical gold, or someone is lying.
As a reminder, based on purely public information, between just the Netherlands' 122 tons of repatriated gold and the Bundesbank's 85 tons, at least 207 tons of gold were quietly withdrawn from the NY Fed in all of 2014. This is what the NY Fed should have reported in its December earmarked gold update delivered yesterday. It also means that the NY Fed should have reported some 40.5 tons of gold withdrawn in December, after reporting 166.5 tons of withdrawals for 2014 through November, for the math to make sense. Instead, according to Federal Reserve data, only $14 billion in earmarked gold was withdrawn in December, bringing the total down to $8,170 billion, or 6,019 tons.
Translated into actual metal, this means that the Fed reported only 10.3 tons of gold withdrawals in the last month of the year, suggesting that there is a quite substantial hole of 30 tons in publicly withdrawn gold that, at least for the time being, is unaccounted for by the Fed.


So what happened: did an intern input the Fed's gold redemptions figures for December, supposedly a different intern than the one who works at the IMF and who caused a stir earlier this week when the IMF, allegedly erroneously, reported that the Dutch - after secretly repatriating 122 tons of gold - had also bought 10 tons of gold in the open market for the first time in nearly a decade.
Or perhaps some "other" bank, central or commercial, decided to offset the redemptions by the Netherlands and Germany, and inexplicably added 30 tons of gold in December? The question then becomes: "who" deposited said gold, especially when one considers that even the adjoining JPM vault which is allegedly connected to the NY Fed by a tunnel, only contains some 740K ounces of gold, or about 23 tonnes.
Or is it simply that when it comes to accurately reporting the flows of physical gold, classical math is incapable of keeping track of the New Normal gold moves, and the Fed has decided that even when dealing with physical gold there is a "settlement" period?
We will find out the answer for sure next month, when unless the Fed revises its 2014 numbers, or plugs the outstanding repatriation "hole" with a late January withdrawal, then a key question will emerge, namely: how can central banks report 2014 inflows of 207 tons from the NY Fed, while said NY Fed only reports 177 tons of outflows.
And no, the GAAP vs non-GAAP excuse won't work this time.
Source: Selected Foreign Official Assets Held at Federal Reserve Banks

Fund Manager: PMs Raided to Prevent Feb Delivery Run on COMEX Gold!

http://www.SilverDoctors.com
http://www.SDBullion.com
With Silver enduring the largest 1-day smash in 18 months Thursday, PM Fund Manager Dave Kranzler joined the show this week discussing:
1. Gold & silver take-down on options expiration/ First Notice Day- Cartel had to force selling of 3 million oz of Feb gold contracts to prevent a potential run on delivery in Feb gold!
2. With the cartel desperate to prevent a delivery run on Feb gold, are fireworks looming for April delivery?
3. Kranzler explains why One of these months a high percentage of longs will finally stand for delivery, & its LIGHTS OUT for the COMEX!
4. Is the End Game in progress- Could the long awaited Economic Armageddon finally arrive in 2015?
5. The Indian Physical Giant is stirring- Kranzler explains why data out of India indicate a BIG move is imminent
6. Gold & the Dollar rising in tandem- why this might foretell one of the largest bull moves of the secular bull run!

---

The Brutal Economics of Blogging

by Charles Hugh-Smith
I’ve found that much of the advice about how to make money blogging suffers from survivorship bias.
I was surprised to read that Andrew Sullivan was closing down his blog and subscription service, as his site was apparently making a lot of money. By a lot I mean enough to have three employees, i.e. a lot in sole proprietor terms, but not in tech start-up terms, where young guys sell their ventures for $26 million and then go back to college because they want to play soccer on a college squad.
This was one story I overheard while waiting for a BART train the other evening; the fellow was relating his excitement at meeting this young tech guru who’d just sold his start-up for $26 million. The BART commuter was confident this young guru would be able to help him launch his own start-up.
A bicyclist who boarded our car at the next stop was carrying a copy of The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses which is something of a bible for youthful entrepreneurs seeking to cash in on the tech gold rush.
The tech gold rush offers about the same odds as the Yukon and California gold rushes in the 19th century. 100,000 strivers with little knowledge of what they were getting into headed out to grab some of that gold, and a mere handful found enough gold and kept enough of it to live large in San Francisco or back east.
The advantage of the tech gold rush is it’s a lot easier, cleaner and safer to sleep on a sofa in San Francisco and code your dreams on a laptop than it was to clamber up mountains, dig the ore out of hard rock with a pick and avoid getting shot in the back if you did strike a vein of gold.
The problem with finding gold is that much of the process boils down to luck and being first. Those who stumbled on the easy wealth could write an account of how they located the gold, but the account would not be as useful to those coming after as we might imagine, due to survivorship bias, a topic I’ve covered several times: The Unknown Unknowns and Survivor Bias (June 15, 2013)
Why Advice From Highly Successful People Is Misleading (and thus potentially harmful)(December 23, 2013)
Blogging, on the other hand, holds little prospect for wealth on the scale of $26 million. In fact, some bloggers can’t even afford an office or a cubicle–they have to work outdoors. Some of these poor devils can’t even afford a shirt on their back. Yes, blogging is a brutal business; look at this wretch, stripped to the waist and tapping out some foolishness:
image: http://www.oftwominds.com/photos2015/blogger-CHSa.jpg
OK, so your heart isn’t bleeding for this shirtless fool (actually, me).
Tongue-in-cheek aside, blogging is not on anyone’s list of get-rich-quick schemes. The primary revenue streams are adverts, affiliate sales, direct sales and subscriptions. Even sites with audiences in the millions that are going full bore on all these fronts might generate $50,000 a month or more–very substantial over time but not $26 million.
The average income-producing blog generates a few hundred or perhaps a few thousand dollars a month for the writer/owner, roughly (so I’ve read) 1% of the site’s page views: by this rule of thumb, 40,000 page views/month = $400 in revenue.
I have no idea if this is accurate, but I reckon it’s a fair description of the long taildistribution of blogging income: a few sites collect most of the revenue, and the rest is distributed over thousands of blogs with smaller audiences.
I’ve found that much of the advice about how to make money blogging suffers fromsurvivorship bias: a new writer could follow all the advice and not generate the income that was supposed to result from doing all the things that presumably created success.
I don’t presume to know what makes a blog acquire an audience, but if pressed I would offer these six quotes as potentially useful guidelines:
“You do not merely want to be considered just the best of the best. You want to be considered the only one who does what you do.” (Jerry Garcia)
“He who will not risk cannot win.” (John Paul Jones)
“All fixed set patterns are incapable of adaptability or pliability. The truth is outside of all fixed patterns.” (Bruce Lee)
“It is not the strongest of the species that survives, nor the most intelligent, but the ones most adaptable to change.” (Charles Darwin)
“Success consists of going from failure to failure without loss of enthusiasm.” (Winston Churchill)
“We must believe in luck. For how else can we explain the success of those we don’t like?” (Jean Cocteau)

Gold And Silver – Probability for A Lower Low Has Increased. Even With Lower Prices As A Possibility, Silver [and Gold] Is Artificially Being Suppressed.

by Michael Noonan
Mention is often made that one should wait for confirmation of a particular move in
futures before making a commitment, either way.  Last week, it appeared evidence was
mounting that November could be a possible low for the correction since late 2011.
Then, we run across this graph from goldchartsrus.com which shows an inordinate
build-up of short positions in silver by what we would call “smart money,” “insiders.”
These large traders do not make such overtly strong commitments to the short side
without expectations that things will go their way.  If anything can be said about the
market manipulators, mostly the elite’s central bankers/Wall Street/Fed, it does not
really matter as to accurate identity, for they hide their source[s] very well.  What matters
is the outcome from the effort, and to date, there has been a lot of “smashing” success in
taking both silver and gold lower, at will, and with no opposition.
We will rely on the proverbial picture being worth 1,000 words and not add anything
further to the ominous implications that this chart portends, and it is why the probability
for a lower low has to be respected as a highly possible event.  The breed of faction behind
these kind of moves make them for good reason and with near “slam dunk” assurances.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/Silver-Shorts.bmp
Crude oil’s express elevator decline is an example of what can happen when those in
control decide to move a market.  These days, almost every market is undergoing some
degree of manipulation to the extent that “free markets” are nonexistent.  It should come
as no surprise that the troika US/CIA/Fed is directly behind most events whose outcomes
are typically destructive.  If not directly involved, then the named trio, acting individually
or in concert, are indirectly involved as in the case of crude oil.  An argument can be made
that the Saudi’s are purposefully punishing all opposition to their market by taking the
price of crude to levels that cannot be economically sustained by other world producers.
In particular, the US shale industry is being targeted as payback against the US for all the
past draconian measures taken against the Saudis, and the Saudis may well be taking
direction from China, or at least acting in concert with China as the “takedown” of the US
and its petrodollar are being driven into oblivion.  Things are getting nasty, in the process,
and the US/Fed are acting more and more like cornered rats.
The elites have become terrified that everything they have been doing and working
toward, as in their New World Order, is at risk, something unthinkable until they started
messing with Putin and Russia.  Putin has been a game-changer against the
moneychangers, and things have really gone south for the elites ever since Obama has |
been directed to impose unimposing sanctions on Russia.  It has been Europe that is
suffering the most as a result of lost business and greater economic hardships imposed by
unelected, non-representative, US-led sycophant bureaucrats from the EU in Brussels.
It will be one of the world’s greatest ironies if Alexis Tsipras, Greece’s newly elected Prime
Minister from the upstart Syriza Party, becomes a huge factor in upsetting the EU’s money
apple cart and helping bring down the European Union, failed organization that it has
been.  PM Tsipras is telling Germany, and the rest of the EU, that Greece does not want
their stinking loans anymore.  The previous loans have destroyed Greece, its economy,
and ruined the lives of so many Greek citizens suffering under German/EU austerity.
Greece is a microcosm of all that is wrong with the unelected organizations, IMF, BIS,
EU, lending money created out of thin air, overburdening sovereign countries to the
point where each country can no longer survive under such onerous imposed debt
burdens.  As other nations watch how Greece is giving the financial finger to Germany
and the EU, as politely and as pointedly as possible, there could be a domino effect that
would be disastrous and cause the breakup of the EU, which will happen anyway.
None of these events are directly correlated to the price of gold and silver, and these are
just a few of a myriad of events occurring around the world that are keeping a lid on the
PMs prices, for now.  While all of the fundamental considerations are very valid, they
are not what is driving gold and silver.  Ukraine, as an Obama false flag, sanctions against
Russia, the collapse of crude oil, the growing solidarity of the BRICS cartel, and now
Greece are all factors driving the destructive ways of the US/CIA/Fed as they fight for
survival.   It will get uglier, and the first chart above may be a harbinger of what is yet
waiting in the wings.
The Concentration Of Traders Chart may influence silver over the next several months.
The timing of unfolding events is impossible with so many developing surprises, like
Greece.  The reading of the charts is irrespective of specific news and/or events, but the
current prices do reflect all that is going on.  We mention “anything can happen,” [crude
oil as a most recent example] a few times here because the charts do not show a likely or
immediate change in trend, so one has to go with “what is” as the charts currently show.
With a new recent low just two weeks ago, there is no way silver can be viewed  as
being in anything other than a down trend with the possibility of still lower prices to
come. Even with lower prices as a possibility, silver [and gold] is artificially being
suppressed.  When you reflect on the increasingly faster pace of events unfolding,
almost all negatively, owning silver and continuing to buy more and more is one of
the best ways to protect oneself from the financial failure that is certain to come.
Price should not matter, any more.  You either have silver and gold or you do not.
If you do not, you are at grave financial risk when the US collapses economically,
and it will as the Fed’s fiat [worthless] “dollar” is increasingly under attack.
We have refrained from putting a time frame on when silver and gold will finally
break free from the manipulative forces, but 2015 could be a defining year.  It
remains to be seen, but events are unfolding at such an increased level and so
unpredictably that this could be the year.  We did not say this in 2013 nor in 2014,
and it may take going into 2016, but be prepared, or you will not be spared.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/SI-M-31-Jan-14-880x612.gif
Silver’s direction has a greater degree of clarity than gold, at least in the charts. The
narrower range at resistance, 2 weeks ago, said sellers were protecting that price level
and preventing buyers from extending the range higher.  Last week’s decline had greater
ease of downward movement, noted by the larger bar.  This keeps silver on the defensive,
and caution is warranted.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/SI-W-31-Jan-14-880x612.gif
The chart comments cover what else needs to be said.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/SI-D-31-Jan-15-880x612.gif
The volume and price activity, since November 2014, has a more positive bias, but the
trend has not turned up, and caution is advised.  This does not imply to exercise caution
in continuing to buy physical gold, and silver, as much as one reasonably can.  Price will
not stay down here for much longer, nor may there be the degree of availability, either.
Best not to be penny wise and pound foolish.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/GC-M-31-Jan-15-880x612.gif
As the chart comments imply, gold is not an easy read, nor should it be, given how it is in
the middle of a TR [Trading Range], where the level of knowledge is at its lowest when it
comes to making an informed decision.  With a greater level of ambiguity in gold, the
somewhat more certainty of the silver charts may be a swaying factor, here.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/GC-W-31-Jan-15-880x612.gif
The message is mixed on the daily.  An area of apparent resistance held to push price
lower, last week, yet the activity is holding half-way retracement areas which is to be
expected in an up trending market, and less so in the current gold market.
A clearer analysis NMT.  [Needs More Time].
Keep buying the physical, and do not fret over what you paid on previous purchases.
Physical gold and silver are being bought for a specific purpose, and price is not the
objective…security is.  Remember: “if you do not hold it, you do not own it” has proven
to be true in too many cases.  For sure, do not keep any gold or silver in a bank under
any circumstances, including and especially retirement accounts.
image: http://edgetraderplus.com/wp-content/uploads/2015/01/GC-D-31-Jan-15-880x612.gif

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