Wednesday, May 22, 2013

No Bear Market in Gold

You know that gold bear market that the financial press keeps touting? The one George Soros keeps proclaiming? Well, it is not there. The gold bear market is disinformation that is helping elites acquire the gold.
Certainly, Soros himself doesn’t believe it, as the 13-F release issued by the Securities and Exchange Commission on May 15 proves. George Soros has significantly increased his gold holding by purchasing $25.2 million of call options on the GDXJ Junior Gold Miners Index.
In addition the Soros Fund maintains a $32 million stake in individual mines; added 1.1 million shares of GDX (a gold miners ETF) to its holdings which now stand at 2,666,000 shares valued at $70,400,000; has 1,100,000 shares in GDXJ valued at $11,506,000; and 530,000 shares in the GLD gold fund valued at $69,467,000. [values as of May 17]
The 13-F release shows the Soros Fund with $239,200,000 in gold investments. If this is bearish sentiment, what would it take to be bullish?
The misinformation that Soros had sold his gold holdings came from misinterpreting the reason Soros’ holdings in the GLD gold trust declined. Soros did not sell the shares; he redeemed the paper claims for physical gold. Watching the gold ETFs, such as GLD, being looted by banksters, Soros cashed in some of his own paper gold for the real stuff.
The giveaway that Soros is extremely bullish on gold comes not only from his extensive holdings, but also from his $25.2 million call option on junior gold stocks. This is a highly leveraged bet on the weakest gold mines. With high production costs and falling gold price from constant short selling in the paper market, Soros’ bet makes no sense unless he thinks gold is heading up as the short raids concentrate gold in elite possession.
In previous articles I have explained how heavy short-selling triggers stop-loss orders and margin calls on investors in gold ETFs. Scared out of their shares or forced out by margin calls, investors’ add to the downward price pressure caused by the shorts. Bullion banks and prominent investors such as Soros are the only ones who can redeem GLD shares for physical metal. They purchase the shares that are sold in response to the falling gold price, and present the shares for redemption in gold metal.
Insiders familiar with the process describe it as looting the ETFs of their gold basis.
In my last column I described how the orchestration of a falling gold price in the paper market protects the dollar’s value from the Federal Reserve’s policy of printing 1,000 billion new ones annually. The other beneficiary of the operation is the financial elite who buy up at low prices the ETF shares sold into a falling market and redeem them for gold. Like all other forms of wealth in the West, gold is being concentrated in fewer hands, while the elite shout “bear market, get out of gold.”
The orchestrated decline in gold and silver prices is apparent from the fact that the demand for bullion in the physical market has increased while short sales in the paper market imply a flight from bullion. As a hedge fund manager told me, it is a Wall Street axiom that volume follows price. Bull markets are characterized by rising prices on high volume. Conversely bear markets feature declining prices on low volume. The current bear market in gold consists of paper gold declining steadily while demand has escalated rapidly for physical metal. This strongly indicates that demand for physical gold continues to be in a bull market despite the savage attacks on paper gold.
If the orchestration is apparent to me, a person with no experience as a gold trader, it certainly must be apparent to federal regulators. But don’t expect any action from the Commodities Futures Trading Corporation. It is headed by a former Goldman Sachs executive.
And don’t expect any investigation from the financial press. The financial press sees a bear market while supplies of bullion decline, premiums over spot rise, and even publicly declared bears such as George Soros make highly leveraged bets that will fail in the absence of a bull market in gold.
May 21, 2013
By Paul Craig Roberts,

All of Obama's Scandals Are Ultimately About Information Control

There’s really no reason for the press to suggest that the recent slew of scandals involving the Obama administration — Benghazi, the AP phone-record seizure, the snooping in James Rosen’s e-mail, the IRS’s targeting of conservative groups, and so on — are a confusing jumble. There is a very clear thread running through all of the administration’s actions:
All of these actions involve an effort to control information.
Some parts of this administration focus on preventing information that is contrary to the administration’s agenda from getting out, or hindering its distribution, and making sure that the only information that goes out supports the perspective of the administration. Other parts leak confidential information designed to attack the reputations of those holding perspectives the administration opposes (NOM, the nine conservative groups) or other whistleblowers (ATF agent Dodson).
This administration prefers to keep the inconvenient parts of the story obscured in darkness.

Ceiling suspended: US takes on $300bn in new debt after hitting $16.7 trillion

AFP Photo / Timothy A. Clary
AFP Photo / Timothy A. Clary
America’s ticking debt bomb has been reset. Washington has suspended the debt ceiling, setting a date, and not a concrete dollar sum as a deadline, an unprecedented first in US history.
Citing ‘extraordinary measures’, the US Treasury has further delayed tackling America’s debt, and will wait until Labor Day, September 2nd, to revisit the burgeoning crisis. The ceiling has been lifted, and the Treasury has promised it will keep cash pumping into government spending programs beyond the debt limit through a series of emergency cash tools.

“It will not be until at least after Labor Day" when Washington will have reached their full borrowing capacity, Treasury Secretary Jacob Lew, told CNBC television on May 10th.
US Secretary of Treasury Jack Lew. (AFP Photo / Saul Loeb)
US Secretary of Treasury Jack Lew. (AFP Photo / Saul Loeb)
Until then, the Treasury will borrow money to mend any gaps between government spending and revenues, adding to the already $16.7 trillion debt.
On Friday, the Treasury Department announced it will suspend sales of State and Local Government Series loans (SLGS) until further notice. The suspension applies to demand deposit and time deposit securities.
In the last four months, the US has accumulated $300 billion in debt. The Congressional Budget Office forecasts that the federal deficit will be $642 billion in FY13.

The US economy has shown some promising signs of recovery. US consumer sentiment rose to its highest level in almost six years, jumping from 89.9 to 97.5, the highest post-recession consumer condition, the University of Michigan study found.

“The global economic leadership position enjoyed by the United States rests on the confidence of Americans and people around the world that we are a nation that keeps its promises and pays all of its bills, in full and on time,”
said Lew.

US lawmakers first agreed to raise the debt ceiling two years ago, following a long, drawn out stand-off between Republicans and Democrats, which prompted Standard & Poor to strip the US of their AAA rating. The failed super committee ushered in sequestration,

This time around, Lew has urged lawmakers to act more swiftly to not tarnish the reputation of the US economy.

"Congress should deal with this right away. The fact that they have more time should not put off dealing with this," he said. "I don't think that it's in the interests of the U.S. or the world economy for Congress to wait until the last minute and create a sense of anxiety,” said Lew.

Lew hinted the debt ceiling is not up for negotiation, and that Obama would not bow to Republicans increase the debt ceiling but he does remain open for talks about a deficit deal.
Lew was sworn in as Treasury Secretary on February 28th, 2013, after Congress voted in favor of raising the debt ceiling in January to avoid a default on the debt.

KEEP PUMPING: Stocks Rise on Fed Officials’ QE Signal… Bernanke Has Now Injected Foreign Banks With Over $1 Trillion In Cash… Holds The Entire World Hostage…

U.S. stocks rise after Fed officials’ QE signal
…Stocks gained after New York Fed President William Dudley, who is also vice chairman of the Federal Open Market Committee, said that the Fed may adjust the pace of asset purchases up or downdepending on the economic outlook and that he was unsure which way the next change will be.
And St. Louis Fed President James Bullard said Tuesday that the central bank shouldcontinue with its present bond-buying program and adjust the rate of purchases in view of incoming data on growth and inflation. He said the program is the best policy option and has been effective.
The Fed’s $85-billion-a-month asset-purchase program aims to boost economic growth and lower the jobless rate. The program has buoyed the stock market and its end — if not properly managed — may hurt sentiment among equity investors, potentially triggering a correction in the market.
“Broadly speaking, investors are really waiting to see what Mr. Bernanke is going to say in front of Congress,” said Andrew Wilkinson, chief economic strategist for Miller Tabak. “The next 20 points in the S&P 500 are probably predicated on what he has to say.”
Two years ago, Zero Hedge first made the observation that the bulk of Fed reserves (also known simply as “cash created out of thin air” because money is first and foremost fungible no matter what textbook theoreticians may claim, and the only cash allocation preference is the capital allocation IRR analysis) had been parked not with US banks, but with foreign banks with US-based operations. We followed that with more analyses, showing explicitly how the Fed was providing a constant cash injection to foreign banks courtesy of the rate on overnight reserves which is the amount Fed pays to banks that hold reserves with it, as the bulk of reserves continued to end up with foreign banks – a situation set to become a huge political storm some time in 2014-2015 when the IOER has to rise and the Fed is “found” to have injected tens of billions of “interest” not into US banks but in foreign banks operating in the US, and which then can upstream the “profits” to insolvent offshore domiciled holding companies.
So it was our expectation that while if not slowing down its rate of money-creation (i.e., reserve-production) – something that won’t happen for a long time as it would crash the stock market – the Fed’s reserves would at least revert to being accumulated at US-based banks. No such luck. In fact as the latest H.8 report demonstrates, as of the most recently weekly data, the Fed’s policies have led to foreign banks operating in the US holding an all time high amount of reserves, surpassing $1 trillion for the first time, or $1,033 billion to be precise.
The one headline we have been waiting for for over four years has just hit:
Not when, if. And there you have it: if the Fed exits, the world (and most certainly Japan) gets it. Thus, for the sake of the children (who will have inhert about $100 trillion in debt but don’t worry: debt is an asset as some “analysts” will promise) Bernanke can never exit. QE…D
And since never is a litte longer than 2016/2017, at some point in the next few years Bernanke will be the proud owner of all marketable Treasury paper. All of it.
Bank of Japan Policy Meeting Preview – Chance Of A Bond Crash?
The current Bank of Japan policy meeting is possibly the most important thing going on this week (even more so than Bernanke’s comments perhaps). If, as is distinctly possible, they don’t do anything to reinforce the immediacy of the Kuroda QQE package, we could be looking at bond markets reacting in a most “unfavorable manner”.  The effect would be to reinforce the latest round of ‘fear-on’ bond selling – certainly over the short-term, and the damaged sentiment could impact stocks also.

That’s why the Bank of Japan policy meeting today/tomorrow will be so interesting. Can it nurture and sustain real growth? Devaluing yen to benefit exporters does seem to be working – look at recent Yen corporate results. However, now we’ve got the rest of Asia looking to balance Japan’s competitive devaluation. We still need to see how the other side of Abe-onomics works: rebuilding Japan. How vulnerable is the BoJ game? The Nikkei may be massively higher, but interest rates and JGB’s remain stubbornly volatile and high – a factor conflating the global bond worries… if the Fed is going to end QE and Japan’s QE squared isn’t working, then bond players will quite rightly capitulate.
There is probably not much the BoJ can say at this meeting – it’s got to give the policy (of massive QE) time to work. That leaves markets highly vulnerable to a sense of disappointment tomorrow. On the other hand, we’ve long said.. “Don’t fight Kuroda!”

U.S. stocks rise after Fed officials’ QE signal

By Polya Lesova, MarketWatch , Victor Reklaitis
NEW YORK (MarketWatch) — U.S. stocks rose on Tuesday, with the Dow industrials and S&P 500 finishing at record highs, after comments from two Federal Reserve officials suggested that the central bank is not close to tapering its bond-buying program.
The Dow Jones Industrial Average DJIA +0.34%  gained 52.30 points, or 0.3%, to end at 15,387.58, notching its 19th consecutive Tuesday rise.
The S&P 500 index SPX +0.17%  climbed 2.87 points, or 0.2%, to 1,669.16, with health care the biggest gainer and telecommunications the biggest laggard among the 10 major industry groups.

The Nasdaq Composite COMP +0.16%  rose 5.69 points, or 0.2%, to 3,502.12.
More than 687 million shares traded on the New York Stock Exchange. Composite volume topped 3.4 billion.
Stocks gained after New York Fed President William Dudley, who is also vice chairman of the Federal Open Market Committee, said that the Fed may adjust the pace of asset purchases up or down depending on the economic outlook and that he was unsure which way the next change will be.
And St. Louis Fed President James Bullard said Tuesday that the central bank should continue with its present bond-buying program and adjust the rate of purchases in view of incoming data on growth and inflation. He said the program is the best policy option and has been effective.
The Fed’s $85-billion-a-month asset-purchase program aims to boost economic growth and lower the jobless rate. The program has buoyed the stock market and its end — if not properly managed — may hurt sentiment among equity investors, potentially triggering a correction in the market.
“Broadly speaking, investors are really waiting to see what Mr. Bernanke is going to say in front of Congress,” said Andrew Wilkinson, chief economic strategist for Miller Tabak. “The next 20 points in the S&P 500 are probably predicated on what he has to say.”
On Wednesday, Federal Reserve Chairman Ben Bernanke will testify before Congress about the economic outlook, and the Federal Open Market Committee will release minutes from its latest meeting.
Stocks on Wall Street finished slightly lower on Monday, after Chicago Federal Reserve President Charles Evans said the Fed’s policy stance remains appropriate and the improving economy still faces headwinds.
Bullish sentiment remains strong on Wall Street. Goldman Sachs raised its year-end target for the S&P 500 to 1,750, and Deutsche Bank recommended staying long equities and added that valuations implied that the S&P 500 could trade as high as 1,800 by year-end.

Bloomberg News Enlarge Image
Apple CEO Tim Cook testified at a Senate hearing Tuesday about the company’s tax practices.
Drug maker Merck & Co. MRK +4.69%  was the top gainer in the Dow Tuesday, rallying 4.7%.
Also in the Dow, Home Depot Inc. HD +2.54%  climbed 2.5% after the home-improvement retailer reported a jump in quarterly earnings, buoyed by the recovery in the housing market.
J.P. Morgan Chase & Co. JPM +1.40%  shares gained 1.4%. At the bank’s annual meeting in Florida Tuesday, shareholders voted against a proposal on split the CEO and chairman roles currently held by Jamie Dimon.
Shares of Apple Inc. AAPL -0.74%  slipped 0.7%, as Chief Executive Tim Cook defended the tech titan’s tax practices as proper at a Senate hearing. A Senate panel has said Apple avoided corporate-income taxes on billions of dollars in overseas income over the past four years. Read MarketWatch’s blog on the Apple hearing.
Polya Lesova is MarketWatch's New York deputy bureau chief. Follow her on Twitter @PolyaLesova. Victor Reklaitis is a New York-based markets reporter for MarketWatch.

America’s Bubble Economy Is Going To Become An Economic Black Hole

By Michael
Black Hole
What is going to happen when the greatest economic bubble in the history of the world pops?  Themainstream media never talks about that.  They are much too busy covering the latest dogfights in Washington and what Justin Bieber has been up to.  And most Americans seem to think that if the Dow keeps setting new all-time highs that everything must be okay.  Sadly, that is not the case at all.  Right now, the U.S. economy is exhibiting all of the classic symptoms of a bubble economy.  You can see this when you step back and take a longer-term view of things.  Over the past decade, we have added more than 10 trillion dollars to the national debt.  But most Americans have shown very little concern as the balance on our national credit card has soared from 6 trillion dollars to nearly 17 trillion dollars.  Meanwhile, Wall Street has been transformed into the biggest casino on the planet, and much of the new money that the Federal Reserve has been recklessly printing up has gone into stocks.  But the Dow does not keep setting new records because the underlying economic fundamentals are good.  Rather, the reckless euphoria that we are seeing in the financial markets right now reminds me very much of 1929.  Margin debt is absolutely soaring, and every time that happens a crash rapidly follows.  But this time when a crash happens it could very well be unlike anything that we have ever seen before.  The top 25 U.S. banks have more than 212 trillion dollars of exposure to derivatives combined, and when that house of cards comes crashing down there is no way that anyone will be able to prop it back up.  After all, U.S. GDP for an entire year is only a bit more than 15 trillion dollars.
But most Americans are only focused on the short-term because the mainstream media is only focused on the short-term.  Things are good this week and things were good last week, so there is nothing to worry about, right?
Unfortunately, economic reality is not going to change even if all of us try to ignore it.  Those that are willing to take an honest look at what is coming down the road are very troubled.  For example, Bill Gross of PIMCO says that his firm sees “bubbles everywhere”…
We see bubbles everywhere, and that is not to be dramatic and not to suggest they will pop immediately. I just suggested in the bond market with a bubble in treasuries and bubble in narrow credit spreads and high-yield prices, that perhaps there is a significant distortion there. Having said that, it suggests that as long as the FED and Bank of Japan and other Central Banks keep writing checks and do not withdraw, then the bubble can be supported as in blowing bubbles. They are blowing bubbles. When that stops there will be repercussions.
And unfortunately, it is not just the United States that has a bubble economy.  In fact, the gigantic financial bubble over in Japan may burst before our own financial bubble does.  The following is from a recent article by Graham Summers
First and foremost, Japan is the second largest bond market in the world. If Japan’s sovereign bonds continue to fall, pushing rates higher, then there has been a tectonic shift in the global financial system. Remember the impact that Greece had on asset prices? Greece’s bond market is less than 3% of Japan’s in size.
For multiple decades, Japanese bonds have been considered “risk free.” As a result of this, investors have been willing to lend money to Japan at extremely low rates. This has allowed Japan’s economy, the second largest in the world, to putter along marginally.
So if Japanese bonds begin to implode, this means that:
1)   The second largest bond market in the world is entering a bear market (along with commensurate liquidations and redemptions by institutional investors around the globe).
2)   The second largest economy in the world will collapse (along with the impact on global exports).
Both of these are truly epic problems for the financial system.
And of course the entire global financial system is a giant bundle of debt, risk and leverage at this point.  We have never seen anything like this in world history.  When you step back and take a good, hard look at the numbers, they truly are staggering.  The following statistics are from one of my previous articles entitled “Why Is The World Economy Doomed? The Global Financial Pyramid Scheme By The Numbers“…
-$70,000,000,000,000 - The approximate size of total world GDP.
-$190,000,000,000,000 - The approximate size of the total amount of debt in the entire world.  It has nearly doubled in size over the past decade.
-$212,525,587,000,000 - According to the U.S. government, this is the notional value of the derivatives that are being held by the top 25 banks in the United States.  But those banks only have total assets of about 8.9 trillion dollars combined.  In other words, the exposure of our largest banks to derivatives outweighs their total assets by a ratio of about 24 to 1.
-$600,000,000,000,000 to $1,500,000,000,000,000 - The estimates of the total notional value of all global derivatives generally fall within this range.  At the high end of the range, the ratio of derivatives to global GDP is more than 21 to 1.
The financial meltdown that happened back in 2008 should have been a wake up call for the nations of the world.  They should have corrected the mistakes that happened so that nothing like that would ever happen again.  Unfortunately, nothing was fixed.  Instead, our politicians and the central bankers became obsessed with reinflating the system.  They piled up even more debt, recklessly printed tons of money and kicked the can down the road for a few years.  In the process, they made our long-term problems even worse.  The following is a recent quote from John Williams of
The economic and systemic solvency crises of the last eight years continue. There never was an actual recovery following the economic downturn that began in 2006 and collapsed into 2008 and 2009. What followed was a protracted period of business stagnation that began to turn down anew in second- and third-quarter 2012. The official recovery seen in GDP has been a statistical illusion generated by the use of understated inflation in calculating key economic series (see Public Comment on Inflation). Nonetheless, given the nature of official reporting, the renewed downturn likely will gain recognition as the second-dip in a double- or multiple-dip recession.
What continues to unfold in the systemic and economic crises is just an ongoing part of the 2008 turmoil. All the extraordinary actions and interventions bought a little time, but they did not resolve the various crises. That the crises continue can be seen in deteriorating economic activity and in the panicked actions by the Federal Reserve, where it proactively is monetizing U.S. Treasury debt at a pace suggestive of a Treasury that is unable to borrow otherwise.
And there are already lots of signs that the next economic downturn is rapidly approaching.
For example, corporate revenues are falling at Wal-Mart, Proctor and Gamble, Starbucks, AT&T, Safeway, American Express and IBM.
Would revenues at Wal-Mart be falling if the economy was getting better?
U.S. jobless claims hit a six week high last week.  We aren’t in the danger zone yet, but once they hit 400,000 that will be a major red flag.
And even though we are still in the “good times” relatively speaking, the federal government is already talking about tightening welfare programs.  In fact, there are proposals in Congress right now to make significant cuts to the food stamp program.
If food stamps and other welfare programs get cut, that is going to make a lot of people very, very angry.  And that anger and frustration will get even worse when the next economic downturn strikes and millions of people start losing their jobs and their homes.
What we are witnessing right now is the calm before the storm.  Let us hope that it lasts for as long as possible so that we can have more time to prepare.
Unfortunately, this bubble of false hope will not last forever.  At some point it will end, and then the pain will begin.

The FED: Celebrating 100 Years of Stealing From You Every Day


(Miss American for FederalJack)   So the gun grab finally has your attention?  I thought we were going to have to wait for the ground to be smoking under your shoeless feet before you woke up and looked around you!  I’m sorry, but the people who have been observing the take down of our country for many years now, don’t have time to bring you up to snuff at this point.  Basically it’s Paul Revere time for us.  There have been so many assaults committed by stealth against Americans of good faith, and carried out so slowly and incrementally, that you have actually been ambushed.  Now I’d advise that you prepare for the sucker punch.   Yes, we were the richest and most prosperous nation on earth.  Yes, a majority of us lived a lifestyle unprecedented in human history, but does the farmer not fatten up his pigs for the slaughter??  We have been a naive and trusting population.  But it’s time to face the ‘opposite day’ world we now find ourselves in.
Unfortunately, people who had a keen understanding of human nature designed a Madison Avenue society that kept the masses well preoccupied with ‘if you work hard enough, you can achieve the American Dream’, while they did their dirty work.  And we were preoccupied, mesmerized by a televised induced spell in fact!  But all the while, the same group we threw off our backs in the American Revolution, never gave up their rabid desire to control our country.  They merely decided to use deception, subversion and the age old power of greed and fear to conquer us this time.  We, along with 99% of the rest of the world have fallen into the hands of an international mafia banking cartel.   They have lusted for world domination for centuries, and have killed millions upon millions of people in their quest.
However, in spite of warnings throughout recorded history, and even from our country’s own founding fathers, in 1913 President Woodrow Wilson committed what was destined to become the gravest act of treason ever, when he signed into law the Federal Reserve Act.  With that signing, he essentially burnt down the country, and eventually the Constitution, the Bill of Rights, and the Declaration of Independence went down in flames with it.  Jesus Christ threw the moneychangers out of the temple, as did many after him, but Wilson opened the door wide and welcomed them back in.   What has ensued ever since, is the wholesale theft of everything America was, and all that Americans cherish and love.
With the ability to print money from nothing, and control it’s ebb and flow, the criminal Federal Reserve Mafia and Israeli dual citizens in high places of U.S. government, have been able to infiltrate and control every facet of our federal, state and local government, our military industrial complex, every educational, medical and research institution, every meaningful business possible including energy, all news media, publishing, agriculture, manufacturing, and pharmaceuticals.   They control all manner of entertainment including sports, Hollywood, gambling, illegal drugs, and pornography.  These parasites upon humanity have also cast their dark shadow over us with:
  • Nuclear power plants built on the earth’s fault lines and permitted far past their pre-planned life.
  • Radiation from bomb testing.
  • Military waste in corroding drums from bomb making tossed into oceans.
  • Depleted uranium used in war weapons and unleashed on our own soldiers.
  • Industrial waste illegally dumped in streams, rivers, bays and oceans.
  • The sexualization of our children.
  • DNA corrupting genetically modified crops and animals.
  • MRSA infested meats used for food and 99% uninspected food imports.
  • Radiation filled fish from Japan is just fine for US consumers thanks to Hillery Clinton.
  • Known poisons added to thousands of foodstuffs and municipal water supplies.
  • Human trafficking and sex slave operations.
  • Illegal organ harvesting.
  • Pedophile procurement rings.
  • Snuff films, violent movies and video games.
  • Gov. lab created bio-warfare germs accidentally and purposefully released on an unsuspecting public.
  • Deadly, crippling, and ineffective vaccines, never tested for eventual cancer or disease causation.
  • Disabling and violence inducing brain drugs prescribed to millions of children.
  • Deadly pharmaceutical drugs ‘fast tracked’, then allowed to remain on the market as people drop
  • dead by the thousands.
  • Daily spraying of heavy metals into the sky by the military and private entities.
  • Control of 90% of the mainstream media which demonizes anyone who exposes truth or logic.
  • Unsafe government ‘limits’ of microwave and radio frequency radiation from wireless technologies.
These sub-humans have even created fake environmental groups to convince us that humanity is a scourge on the earth, or that a blind salamander has more importance than people.  They even pay these groups to sue the government or ‘federal agencies’ to enable their hidden agendas such as land grabs or oil monopolies.  It’s called controlled opposition and they are experts at working both sides on any issue.   Funny how these same environmentalists (called ‘tree huggers’ by their handlers) are mum on the actual atrocities being committed against mother earth!
Our country, which once had morals, values, pride, love, the rule of law, and faith in our future, has disintegrated in front of our eyes.  Many are too blinded to see, so stuck in front of the TV they are with its false propaganda, lies and assurances that everything is just fine (and pay no mind to those enemy combatants, the conspiracy theorists!).  The television has absolutely been the downfall of our society, a powerful and hypnotizing mass control tool of the devils.  Research the flicker rate of high definition TV and its effect on the brain.  Have you ever wondered why everyone had to transition to HDTV?
These are the people running the American show now.  Our ‘Republic’ has been stolen by stealth.  By bribe or threat they now create our legislation.  They’ve turned all our federal agencies into draconian rogue forces that terrorize and swat team us without explanation or charges.  They are controlling what we can and can’t eat, and want to take vitamins and natural health treatments away from us.  We can’t drink organic milk, but they want to force us to roll up our sleeves so they can inject their idea of good health into our veins.  The CIA is their assassination and terrorist recruiting arm, and the IRS will now police health care.  The CPS, APS, and the courts abduct children and the elderly for incentive federal money and theft of estates.  They are forcing school children into mental evaluations so that they can force drugs on them.  They are doing the same to our veterans (of their wars) to take away their right to own arms, because if you went to guard Afghani poppy fields, surely you have PTSD!   Maybe you have taken notice how our former ‘protect and serve’ police forces have turned brutal, impulsive, and merciless!   Many have been trained in Israeli policing methods.  They have long ago re-written the history books so citizens won’t learn American history, or understand world history.  In many countries you cannot talk or write about what really happened concerning Hitler’s so-called death camps in Germany during WW2, or you will be guilty of ‘hate speech’ and go to jail.  Americans will be next.  To find out who controls you, ask who you cannot criticize.
These Moneychangers have created the financial take down of the world in order to bring in their New World Order with a total technocratic control grid in which every facet of life will be under their boot.  It’s full blown Communism along with unaccountable rendition and extermination of any resisters.  Yet even to this day, most people have no idea who ‘they’ are, so presidents, congressional minions, and police will be left holding the blame bag.  And they are to blame!  Anyone who lived to see JFK killed knew what was involved if they went down the road of American politics.  They are vetted well before a serious run for office to make sure they will be loyal to our best enemy Israel and the Rothschild, Morgan, Goldman Sachs banking cartel.  If they aren’t, they will be gone, one way or the other.  At the very least they will be vilified and forever trashed by the totally controlled TV, print or internet media.  This also happens to honest scientists, doctors, or any credible or well known public figure who speaks the truth, or threatens to expose their crimes or agenda.   This is why you do not see smart, ethical, intelligent, sensible, logical, red-blooded Americans seeking high office in our country.  JFK was the last of them.
Yes, I realize there have always been despots, ruthless dictators, and psychopaths on this earth with us, and narcissistic men filled with hubris who want to murder millions so they can run the world.  But the Zionists, and their endless myriad of paid off minions have a particularly heartless, barbaric and sadistic signature.   Read history books on how they have treated ‘the Goyim’ (anyone not a Jew) through the centuries.  They deeply believe the ‘goy’ are merely put on earth to serve them.  In fact they have killed their own if it was in the interest of their plan.  When you encounter them, you can almost feel your blood run cold.  You can sense their lack of a soul.  You can feel the presence of the devil.  They thrive on blood, guts, torture, and destruction.   It just takes a short look at how they slaughter their cattle to convince you this is true.  And who invented circumcision, the butchering of God’s creation?  Their modus operandi is to destroy families, morally bankrupt societies, introduce multi-culturalism (everywhere but in Israel) to dilute nationalism, create distention to divide groups, glorify deviance, demonize cultures and religions, and shove their beliefs down our throats.  At this point, it looks as if it has worked quite well.  America has bought into the plan, hook, line and sinker and it appears that we’ve passed the point of no return.  There is no white horse on the horizon.  We have but one savior left.  Witness the big push for people to accept and welcome gay lifestyles, and the soon to be pedophilia normalcy bias.  And just so you know, they will do anything it takes to accomplish what they think is their God given right to achieve.  Open hypocrisy, lies, subversion, slow kill, murder, and murder disguised as suicides or accidents are their calling card.  The list of extinguished souls is endless.
Personally I have never had prejudice against anyone’s race, religion, or color.  When I grew up we were not allowed to use racial slurs in our home.  I never knew anything negative about Jewish history until I began to search for who was doing this to us and why.   Why were our leaders turning on us?  Why is  everything they do the wrong thing for America, or morally wrong toward people?  Why have they turned us into the enemy?  Why was patriotism turned into terrorism?  Why do they despise and have contempt for us?  I got tired of hearing about ‘globalists, the New World Order, and the Illuminati’!  I wanted to know WHO it is that thought up all these brutal things being done to our country and our people.  Could there be that many people with such devious diabolical minds?  I’m a registered independent, but I voted for President Obama (alias Barry Sotoro), so desperate I was for ‘change’ and some ‘hope’ that our country would not continue to head for the dirt nap.  (Never mind that voting for the traitor Mr. McCain wasn’t even on my radar).   Is there anyone who voted for this imposter that doesn’t feel like a real sucker and a totally betrayed fool??  I see now that the controllers are moving in for the kill, dropping their masks, and taunting us to protest or resist.  They will not stop until they have stolen every last vestige of the life we had.  They don’t care if we know what they’re doing.  They are laughing at us.  To be this obvious and this much in our face is not a good omen.  They have been amazingly genius at keeping everyone in the dark until the big boot was all polished and ready to stomp, using printed trillions out of thin air to enslave us.  They must be ready to pull the plug.   Imagine, all the wars having been fought to guarantee them the right to counterfeit money to infinity. All wars are banker wars!  How could we not have questioned and thrown out, the counterfeiting Ponzi scheme that is the banking system?
Oh….. don’t forget to observe The Federal Reserve’s Centennial Birthday: ‘Celebrating 100 years of stealing from you every day’!  Why did we ignore the warning signs?  Why didn’t we learn from the brutal murderous trail the moneychangers had already laid?  By not learning from history, we are now doomed to repeat horrific episodes of the past.

Washington Signals Dollar Deep Concerns

Over the past month there has been a statistically improbable concurrence of events that can only be explained as a conspiracy to protect the dollar from the Federal Reserve's policy of Quantitative Easing (QE).
Quantitative Easing is the term given to the Federal Reserve's policy of printing 1,000 billion new dollars annually in order to finance the US budget deficit by purchasing US Treasury bonds and to keep the prices high of debt-related derivatives on the "banks too big to fail" (BTBF) balance sheets by purchasing mortgage-backed derivatives. Without QE, interest rates would be much higher, and values on the banks' balance sheets would be much lower.
Quantitative Easing has been underway since December 2008. During these 54 months, the Federal Reserve has created several trillion new dollars with which the Fed has monetized the same amount of debt.
One result of this policy is that most real US interest rates are negative. Another result is that the supply of dollars has outstripped the world's demand for dollars.
These two results are the reason that the Federal Reserve's policy of printing money with which to purchase Treasury bonds and mortgage backed derivatives threatens the dollar's exchange value and, thus, the dollar's role as world reserve currency.
To be the world reserve currency means that the dollar can be used to pay any and every country's oil bills and trade deficit. The dollar is the medium of international payment.
This is very helpful to the US and is the main source of US power. Because the dollar is the reserve currency, the US can cover its import costs and pay for its cost of operation simply by creating its own paper money.
If the dollar were not the reserve currency, Washington would not be able to finance its wars or continue to run large trade and budget deficits. Therefore, protecting the exchange value of the dollar is Washington's prime concern if it is to remain a superpower.
The threats to the dollar are alternative monies–currencies that are not being created in enormous quantities, gold and silver, and Bitcoins, a digital currency.
The Bitcoin threat was eliminated on May 17 when the Gestapo Department of Homeland Security seized Bitcoin's accounts. The excuse was that Bitcoin had failed to register in keeping with the US Treasury's anti-money laundering requirements.
Washington has stifled the threat from other currencies by convincing other large currencies to out-print the dollar. Japan has complied, and the European Central Bank, though somewhat constrained by Germany, has entered the printing mode in order to bail out the private banks endangered by the "sovereign debt crisis."
That leaves gold and silver. The enormous increase in the prices of gold and silver over the last decade convinced Washington that there are a number of miscreants who do not trust the dollar and whose numbers must not be permitted to increase.
The price of gold rose from $272 an ounce in December 2000 to $1,917.50 on August 23, 2011. The financial gangsters who own and run America panicked. With the price of the dollar collapsing in relation to historical real money, how could the dollar's exchange rate to other currencies be valid? If the dollar's exchange value came under attack, the Federal Reserve would have to stop printing and would lose control over interest rates.
The bond and stock market bubbles would pop, and the interest payments on the federal debt would explode, leaving Washington even more indebted and unable to finance its wars, police state, and bankster bailouts.
Something had to be done about the rising price of gold and silver.
There are two bullion markets. One is a paper market in New York, Comex, where paper claims to gold are traded. The other is the physical market where personal possession is taken of the metal–coin shops, bullion dealers, jewelry stores.
The way the banksters have it set up, the price of bullion is not set in the markets in which people actually take possession of the metals. The price is set in the paper market where speculators gamble.
This bifurcated market gave the Federal Reserve the ability to protect the dollar from its printing press.
On Friday, April 12, 2013, short sales of gold hit the New York market in an amount estimated to have been somewhere between 124 and 400 tons of gold. This enormous and unprecedented sale implies an illegal conspiracy of sellers intent on rigging the market or action by the Federal Reserve through its agents, the BTBF that are the bullion banks.
The enormous sales of naked shorts drove down the gold price, triggering stop-loss orders and margin calls. The attack continued on Monday, April 15, and has continued since.
Before going further, note that there are position limits imposed on the number of contracts that traders can sell at one time. The 124 tons figure would have required 14 traders with no open interest on the exchange to sell all together in the same few minutes 40,000 futures contracts. The likelihood of so many traders deciding to short at the same moment at the maximum permitted is not believable. This was an attack ordered by the Federal Reserve, which is why there is no investigation of the illegality.
Note also that no seller that wanted out of a position would give himself a low price by dumping an enormous amount all at once unless the goal was not profit but to smash the bullion price.
Since the April 12-15 attack on the gold price, subsequent attacks have occurred at 2pm Hong Kong time and 2 am New York time. At this time activity is light, waiting on London to begin operating. As William S.Kaye has observed, no entity concerned about profits would choose this time to sell 20,000 to 30,000 futures contracts, but this is what has been happening.
Who can be unconcerned with losing money in this way? Only a central bank that can print it.
Now we come to the physical market where people take possession of bullion instead of betting on paper instruments. Look at this chart from ZeroHedge. The demand for physical possession is high, despite the assault on gold that began in 2011, but as the price is set in the non-real paper market, orchestrated short sales, as in the current quarter of 2013, can drive down the price regardless of the fact that the actual demand for gold and silver cannot be met.
While the corrupt Western financial press urges people to abandon bullion, everyone is trying to purchase more, and the premiums above the spot price have risen. Around the world there is a shortage of gold and silver in the forms, such as one-ounce coins and ten-ounce bars, that individuals demand.
That the decline in gold and silver prices is an orchestration is apparent from the fact that the demand for bullion in the physical market has increased while naked short sales in the paper market imply a flight from bullion.
What does this illegal manipulation of markets by the Federal Reserve tell us? It tells us that the Federal Reserve sees no way out of printing money in order to support the federal deficit and the insolvent banks. If the dollar came under attack and the Federal Reserve had to stop printing dollars, interest rates would rise. The bond and stock markets would collapse. The dollar would be abandoned as reserve currency. Washington would no longer be able to pay its bills and would lose its hegemony. The world of hubristic Washington would collapse.
It remains to be seen whether Washington can prevail over the world demand for gold and silver. Can the dollar remain supreme when offshoring has deprived the US of the ability to cover its imports with exports? Can the dollar remain supreme when the Federal reserve is creating 1,000 billion new ones each year, while the BRICS, China and Japan, China and Australia, and China and Russia are making deals to settle their trade balances without the use of the dollar?
If the consumption-based US economy deprived of consumer income by jobs offshoring takes a further dip down in the third or fourth quarter–a downturn that cannot be masked by phony statistical releases–the federal deficit will rise. What will be the effect on the dollar if the Federal Reserve has to increase its Quantitative Easing?
A perfect storm has been prepared for America. Real interest rates are negative, but debt and money are being created hand over foot. The dollar's demise awaits the world's decision how to get out of it. The Federal Reserve can print dollars with which to keep the bond and stock markets high, but the Federal Reserve cannot print foreign currencies with which to keep the dollar afloat.
When the dollar goes, Washington's power goes, which is why the bullion market is rigged. Protect the power. That is the agenda. Is it another Washington over-reach?
Bitcoin Note: On May 16, PCWorld reported: "The seizure of funds of the largest bitcoin exchange, Mt. Gox, was triggered by an alleged failure of the company to comply with U.S. financial regulations, according to a federal court document. The U.S. District Court in Maryland on Tuesday ordered the seizure of Mt. Gox's funds, which were in an account with Dwolla, a payments company that transferred money from U.S. citizens to Mt. Gox for buying and selling the virtual currency bitcoin."
Reports subsequent to my column suggest that instead of funds being seized, a money transfer mechanism was shut down. Whatever happened, the government has demonstrated that it can disable or destroy Bitcoin at will. Bitcoin might be tolerated unless it becomes widely used. If the government regards Bitcoin as a refuge from the dollar, it can simply have its agents buy up the Bitcoins, driving the price skyhigh, and then dump the purchases all at once, just as tons of gold shorts were dumped on the gold market.
Bitcoin showed its vulnerability in April when, according to news reports, someone gave away $13,627 worth of Bitcoins, and Bitcoin values crashed from $265 to $105. Some people who watch this market concluded that the exercise was a covert central bank stress test.
The fact that I reported on Bitcoin does not mean that I oppose Bitcoin. The point of my article is to demonstrate that the government will take all steps to protect the dollar from Quantitative Easing.
This column was originally published at and is reprinted here with the author's position. Dr. Roberts was Assistant Secretary of the US Treasury for Economic Policy in the Reagan Administration. He was associate editor and columnist with the Wall Street Journal, columnist for Business Week and the Scripps Howard News Service. He has had numerous university appointments. His latest book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West is available here.

John Browne Weighs In On Gold Market's Disconnect Between Paper Gold & Bullion Demand

Growth Of Suburban MN Poverty Among Highest In Nation

MINNEAPOLIS (WCCO) — Twin Cities suburbs feature plenty of spacious homes and luxury cars, but they’re also seeing a big increase in poverty.
In fact, a new study says the growth in the poverty rate for the Twin Cities suburbs is among the highest in the nation.
The report, by Brookings, challenges the notion that poverty is only a problem for urban and struggling rural areas.
When in reality, even some of the communities in the metro area with some of the wealthiest residents, also have some of the poorest.
The study shows the number of suburban Twin Cities residents living in poverty has more than doubled in the last decade.
Brookings Institution — a think tank out of Washington, DC — indicates there are 115,000 more poor people living in the Twin Cities suburbs than there were just 10 years ago.
The ICA food shelf in Minnetonka has 80,000 pounds of food ready to hand out to families. They said they recycle through that every month and a half.
They’ve seen their food service output to families in need go up 115 percent in the last four years.
The assistant director there said the growing poverty problem could be a product of underemployment and the rising cost of health care.
“We’re finding that as people come in and donate food, they’re shocked at how much food that we have, how much food we’re giving out, how many people are coming,” said Jayson Palm, associate director of ICA Food Shelf Minnetonka. “About a couple years ago, we were giving out food to 350 families a month and now it’s over 800 a month to receive food. So the need as been rising incredibly.”
Shakopee and Apple Valley were among the top cities listed for outer-ring suburbs with the most dramatic increases in poverty. Still, though certain areas are struggling, the poverty rate in the Twin Cities suburbs is still less than 8 percent — that’s lower than most other suburban areas.

One North Texas Officer Says Ticket Quotas Do Exist…And It May Be A Ticket To A Trophy

FORT WORTH (CBS 11 NEWS) - The sound of the siren. The lights in your mirror.  You know the feeling …and you know what’s next.
No one likes to be pulled over by police for a traffic violation.
Some of you might even argue that you weren’t speeding … or you didn’t run that traffic light.  You could have sworn your blinker was on when you made that turn.
But what if you knew what the I-Team has learned.
We have obtained internal Fort Worth Police Department memos that show some officers who are part of a special enforcement program – funded by a federal grant and administered by the state — must make at least four traffic stops an hour.
It is against the law in Texas for police to have a traffic ticket quota. But a veteran Fort Worth officer, who spoke to the I-Team on the condition that he remains anonymous, says the Fort Worth PD runs a quota system anyway.
“That’s how the Fort Worth Police Department tries to get around the quota system …they don’t come out and say ‘write four citations,’ they say four “contacts,” the officer told the I-Team, adding: “But the officer working the grant knows what “contact” means.”
The FWPD is one of numerous law enforcement agencies in Texas that participate in the Selected Traffic Enforcement Program, also known as STEP.
The Dallas Police Department’s recent step grant is reportedly worth nearly $1 million. But when the I-Team repeatedly asked Dallas police about whether they have a quota on ticket writing, they simply did not respond.
However, we obtained exclusively several Fort Worth police internal memos, including one that says, “Our contractual agreement with the state of Texas is that officers will make four traffic contacts per hour. Performance at this level is paramount to maintaining the grant.”
An older police memo said the “law enforcement objective” for the STEP grant program was to increase speed citations by 14,250; DWI arrests by 200; safety belt citations by 975 and child safety seat citations by 100.
Police patrol officers who participate in the STEP program are paid overtime, which is funded by the grant.
The three officers who write the most tickets by the end of the grant period “get a trophy and a letter of appreciation for being the top producers,” the veteran officer told the I-Team.
Fort Worth Police Chief Jeff Halstead initially agreed to be interviewed, but he cancelled only hours before the meeting was to begin.
The department said the police chief could not address our questions about a quota system because of pending court cases against several officers accused of falsifying information on traffic tickets.
The Texas Department of Transportation also declined to be interviewed on camera and, instead, issued a statement. In part, it said, “At no time does TxDOT require an individual officer to issue a specific number of citations during any specific enforcement period.”
That explanation was not good enough for lawyer Trent Lofitn, a former Tarrant County prosecutor, who said a quota system on the issuance of traffic tickets “is a disruption of your liberty.”
“Let’s say he has to do five or six stops per hour. What if during that time nobody is breaking the law? What’s he going to do, pull somebody over just to make a quota,” Loftin said.
After stepping out of his lawyer’s office, hoping to take care of a speeding ticket he does not think he deserved, Carl Holmes of Fort Worth said he wondered if he may have been a “victim” of a police quota system.
“That (bleep) me off actually,” said Holmes. “If what you’re investigating turns out to be truthful …the department needs to take a look at rectifying and fixing that problem – not just for my sake, but for everybody who comes through Fort Worth,” he said, adding:
“Because it will be look at, people are going to take notice of it and probably make some noise.”

Beware of the “Fair Tax” Scam Solution While they Call for the End to the IRS.

The IRS should be eliminated because it has used a tax system that exploits class warfare and used by every President to go after their political enemies. The most obvious case of abuse was with the famous boxer Joe Lewis who had been robbed ruthlessly by this agency that is the collection arm of the Federal Reserve Bank.
Now President Obama is now being grilled and rightly so for using the IRS to harass the Tea Party movement and other patriot groups trying to silence and shut them down to send a chilling effect not to challenge the White House.
Before 1913, there was no income tax and the US government had no trouble funding itself. When the Federal Reserve Act and the 16th amendment that was fraudulently ratified. Our nation had unhindered economic growth. The Grace commission formed by President Ronald Reagan concluded:
” not one penny of the income tax goes to fund the government”.
The income tax is used to pay the interest on the debt to the Federal Reserve bank for the blessing of using their interest based currency.
Now we hear people calling for the “Fair Tax”. Especially a former IRS agent congresswoman Michelle Bachman. The red flag of the Fair Tax is the prebate on food where the government is supposed to reimburse the consumer for taxes paid at the point of sale. Well just do not tax food, it is that simple.  That is what I see from a first impression looking at the fair tax.
Lawrence Vance a critic of the Fair Tax said emphatically:
The Fair Tax does nothing to tame the federal leviathan. The solution is nothing less than a drastic reduction or wholesale elimination of its revenue source. What is fair about allowing the government to confiscate 23 percent of the value of every new good and service? Fair Tax proponents may call it necessary legislation, but I call it highway robbery.
Another fair tax critic Murray Rothbard also weighed in commenting saying:
The consumption tax, on the other hand, can only be regarded as a payment for permission-to-live. It implies that a man will not be allowed to advance or even sustain his own life, unless he pays, off the top, a fee to the State for permission to do so. The consumption tax does not strike me, in its philosophical implications, as one whit more noble, or less presumptuous, than the income tax.
The Fair Tax is a fraud as they say out of the frying pan into the fire. The fair tax will hurt more the working poor and people with fixed incomes who will be taxed on everything they earn paying all they earn purchasing goods and services because they have discretionary income that have to spend on just to survive than disposable income they can spend on luxury or recreation.
To me the fraud of the Fair Tax does not address one big issue. That is ending the reign of the Federal Reserve Bank. It does not eliminate the ” Death Tax” were the US Government writes itself as a beneficiary of an estate without the consent of person writing the will by taxing the estate. We no longer have no taxation without representation. Today we live in a world of taxation out of hesitation. The fair tax is just a Trojan horse of switching from one form of economic slavery for another.
There is one solution that is sure to end the economic slavery that has a choke hold on the economy. Retired Congressman Ron Paul is the real remedy he has been saying for decades.
Shut down the Federal Reserve bank.
Go back to a non interest baring currency.
End the IRS and the income tax replacing it with NOTHING. Not even with the Fair Tax.
Rep. Ron Paul’s concern about the fair tax is in a letter to Larry Burton stating:
However, the real key to tax reform is dramatically reduced spending by the federal government. Until the government spends far less, taxes (in whatever form) will remain too high. While I certainly support eliminating the income tax, I do not want to see it replaced with a high national sales tax which attempts to collect the same amount of revenue. Spending is the real problem.
The Fair Tax does not address reducing spending or proposes reducing the size of government back within the confines of the Constitution. it does not propose ending the Federal Reserve that uses the hidden tax of inflation. Can you imagine a 30 percent tax on goods and services with the hidden tax of inflation added in by a devalued dollar? That thought scares me most of all.

Pentagon Seeks Another $79 Billion for Afghan War

Funds in Addition to $526 Billion Budget Already Requested

by Jason Ditz, May 20, 2013
Pentagon officials have submitted a new request for another $79.4 billion for “overseas contingency operations,” essentially to pay for the 2014 fighting of the Afghan War. The request is above and beyond the $526 billion the Pentagon is already seeking for 2014, which was supposed to include the war’s costs.
Requests for supplemental war funds are nothing new for the Pentagon, but the latest request comes in the context of a growing budget crisis in Afghanistan, with the 2013 “contingency funds” already burned through as costs continue to soar.
The Pentagon’s estimates for their costs have been much too low, as the “success” that is always supposed to be just around the corner in Afghanistan never pans out, and officials conceded in recent comments that the costs of the war may continue to rise “substantially” going forward.
Officials are bragging that the 2014 request is somewhat less than the 2013 version, but the reality is that with surge troops being withdrawn, the savings were supposed to be significant. Instead, the war continues as an all-consuming sinkhole for tax money, with no end in sight and the Pentagon’s best estimates inevitably falling far short.

Peter Schiff: Stocks rise as recovery fantasy fades, oil breaks out, potential bottom in gold & silver

“Short Squeeze” Fades in Precious Metals, Gold Miner Adds to Hedges, Contrarians Spot “Time to Buy”

London Gold Market Report
from Adrian Ash, BullionVault
Tues 21 May, 09:10 EST

“Short Squeeze” Fades in Precious Metals, Gold Miner Adds to Hedges, Contrarians Spot “Time to Buy”

The PRICE of both silver and gold slipped back in London on Tuesday morning, cutting into yesterday’s rapid gains from 4-year and 1-month lows respectively.

World stock markets stalled after hitting a series of near and new all-time highs so far this month.

The British Pound fell hard – supporting the gold price in Sterling above £910 per ounce – after new data showed a slowdown in consumer price inflation.

“These stunning upside reversals off fresh lows [in gold and silver] were somewhat justified,” says a note from brokers INTL FC Stone, “given that both were quite oversold.”

Monday’s sudden leap in the silver and gold price, which took only a few minutes, was sparked by a “classic short squeeze” according to several analysts today.

Bearish bets in gold futures rose last week to a record holding for speculative traders, breaking 100,000 short contracts – which profit if prices fall – for the first time on record, according to US regulatory data.

Monday’s dramatic $30 jump in the gold price equaled a 2.2% rise, but saw silver jump faster – up 3.9% in a matter of minutes.

Across in Asia, “Physical support for the price is currently huge,” says another analyst in a note, “but will not last forever in our view.

Two weeks after both India’s gold-buying festival of Akshaya Tritiya and tight restrictions on Indian gold imports, “There is no action in the market,” said one Mumbai bank dealer to Reuters earlier.

“Everybody has stopped consignment imports. [So] premiums are still on the higher side in the domestic market” at up to $20 per ounce above the world’s benchmark gold price for London settlement.

On the production side today, London-listed gold miner Petropavlovsk Plc – whose shares have lost two-thirds of their value since New Year, and whose executives have waived 2013 bonuses to help slash costs – extended the gold hedging program it began in February.

With output forecast around 21 tonnes for the next 12 months, Petropavlovsk has now hedged 15 tonnes of that gold, locking in a price of first $1663 and then $1408 per ounce.

Forward sales by larger gold producers grew throughout the 1990s bear market. The industry’s total “hedge book” reached more than 2,900 tonnes in 2001. Leading analysts GFMS said earlier this month they don’t foresee a big move back towards gold hedging by miners any time soon.

As a sector, North America’s major listed gold mining stocks have dropped half their value since the price of bullion peaked in September 2011.

The gold price today stood 28% lower from then, trading at $1375 per ounce by lunchtime in London.

“We have been tempted [by gold mining stocks] for a long time,” says Robin McDonald of Cazenove’s $1.6 billion Multi-Manager Diversity fund, speaking to TrustNet, and “we saw the fall of 22% back in April as the right time.”

Now adding Blackrock’s Gold & General fund to his holdings, “People have become wholly disillusioned with the asset class,” McDonald says.

“In my experience, when nobody has anything nice to say about an asset class,from a contrarian standpoint, it’s time to buy.”

Looking at silver bullion on Monday, Bank of America Corp’s Michael Widmer in London told Bloomberg that “A lot of the investors who bought silver on a view of Dollar debasement or inflation picking up massively I think are now disappointed.

“The other point,” Widmer added, “is that silver industrial demand in [this global] mood of subdued economic growth is not doing particularly well either.”

Meantime in the stock market, investment bank Goldman Sachs has raised its target price for the S&P 500 index – currently at 1665 – to 1750 by year’s end, with further advances to 2,100 in 2015.

“We forecast dividends will rise by 30% during the next two years,” says Goldmans. “Further expansion [in the price/earnings ratio, with stocks rising faster than revenues] is possible if interest rates stay low, growth improves.”

After holding US interest rates unchanged between zero and 0.25% for the 53rd month running at the Federal Reserve’s last policy meeting, central bank chief Ben Bernanke is due to testify Wednesday to the Joint Economic Committee of the Senate.

“Bernanke is unlikely to hint at a tapering of [quantitative easing] bond purchases,” says today’s Commodity Daily from the analysis team at Standard Bank in London, “which would be a positive for gold.

“Below $1360 the metal represents a reasonable buying opportunity.”

Adrian Ash

Systemic Breakdown? Financial Bubbles Creating Conditions for New Crash

It is a sure sign of the systemic breakdown of the global capitalist system that the very measures put in place to try to prevent a crisis are creating the conditions for a financial meltdown beyond even the scale of 2008.
For almost five years the world’s major central banks have pumped an estimated $7 trillion into financial markets with the stated aim of trying to spark an economic recovery. Economic data from around the world indicate that it has been a manifest failure.
The statistics on price levels are among the most significant. These show that rather than prices increasing—a sign of recovery in so-called “normal” conditions—deflationary pressures are intensifying.
In the US, consumer prices fell by 0.4 percent in May, the biggest decline since late 2008, following a 0.2 percent decline in April. In Europe, excluding food and energy costs, consumer prices in the 17-member euro zone rose by just 1 percent in April from a year earlier.
The downtrend has far-reaching implications. Confronted with falling prices for their products, major firms and corporations seek to make profits not by investing and expanding production, as they would seek to do if a recovery were underway, but by savage cost-cutting coupled with financial speculation. The consequent cuts in pay and jobs lead to a reduction in consumer demand, further fueling the deflationary trend.
Other economic data highlight this process. Last month, US industrial production fell by 0.5 percent, compared to a projected decline of 0.2 percent, prompting predictions that results for the second quarter would be even worse than the last quarter of 2012, when the US economy showed virtually no expansion.
In the euro zone, unemployment has risen for the 23rd consecutive month and now stands at 12.1 per cent, a 1.1 percent increase over the level a year ago. The euro zone economy contracted by 0.2 percent in the first quarter, meaning the current contraction has lasted longer than that experienced in 2008-2009.
Since the onset of the breakdown in 2008, the prospect has been held out that China could provide the basis for the long-term expansion of the global economy. But while industrial production and retail sales both showed a significant rise last month, pointing to economic growth of about 7.5 percent this year, these hopes are being dashed.
In a recent article pointing to the absence of “a strong source of demand growth” anywhere in the global economy, the Financial Times noted that “worries” about the Chinese economy were “widespread.” In the long term it was clear that the double-digit growth of the past decade was a thing of the past, while in the short term, despite an expansion of credit the rise in GDP produced by this lending was near its lowest level for a decade.
In contrast to the trends in the real economy, financial markets are experiencing an unprecedented boom. The Dow Jones Industrial Average is up by 15 percent since the Fed launched its third round of quantitative easing last September. In Japan, the Nikkei index has climbed 44 percent since last December and the election of the Abe government, which demanded that the Bank of Japan boost the money supply. In the UK, the FTSE index has gained 20 percent in the last six months on the back of quantitative easing by the Bank of England, despite the fact that the British “recovery” is weaker even than that experienced in the Great Depression, while European stock markets have gained 30 percent since last July.
These increases are being fuelled entirely by the trillions of dollars being pumped into the financial system by the major central banks.
But rather than expressing a “recovery,” the booming share markets are a fever chart of the deepening crisis of the capitalist system. Never in the history of world capitalism has there been such a divergence of financial markets from underlying economic processes.
The unprecedented rise in global markets has sparked concerns that the conditions are being created for a crash. As Financial Times columnist Gillian Tett noted, “[W]hile the flood of central bank liquidity is enabling the system to absorb small shocks, it is also masking a host of internal contradictions and fragilities that could surface if a shock hits” with the “potential for… future violent instability rising apace.”
While any rational analysis points to the fact that the present conditions are preparing the way for a disaster, the frenzy of speculation continues according to its own mad logic. As the then-chief executive of the US banking giant Citigroup, Chuck Prince, famously remarked in July 2007: “As long as the music is playing, though, you’ve got to get up and dance.” Little more than a year later, the global financial system plunged into its worst crisis since the 1930s.
Today the situation is potentially even more explosive than five years ago. This is because, unlike 2008, the central banks, having bought up trillions of dollars worth of government and other financial assets, are key market players themselves, and so will be directly impacted by a collapse of financial markets.
Increasingly, they are being caught in a trap of their own making. Withdrawal of the financial stimulus measures threatens to collapse the bubble. At the same time, the pumping out of still more money draws them deeper into the mire.
Last week, economists at the International Monetary Fund published an analysis warning that ending easy money policies could result in the central banks suffering severe losses as interest rates spiked and bond prices fell. The Federal Reserve could experience a loss equivalent to as much as 4 percent of GDP ($628 billion), the Bank of Japan could lose 7.5 percent of GDP, and the Bank of England almost 6 percent.
In other words, a new financial shock could call the stability of the central banks themselves into question. Unlike the situation in 2008-2009, they would be unable to mount a rescue operation.
The deepening global crisis of capitalism has the most far-reaching political implications.
The past five years have seen the pumping of hundreds of billions of dollars into the coffers of the banks and speculators, and the financial elite that benefits from their activities, while the impoverishment of ever broader sections of the population has continued unabated.
These measures, far from producing an economic “recovery,” have prepared the way for even bigger disasters.
This article originally appeared on : Global Research