Friday, December 6, 2013

Another Batch of Wall Street Villains Freed on Technicality

General Electric company
General Electric's corporate headquarters.

I love covering trials, which is one reason I've been a little sad since switching over to the Wall Street beat: Few of the bad guys in this world ever even get interviewed by the authorities, much less indicted, so trials are comically rare.
But we did have one last year, a big one, and though it was boring and jargon-laden enough on the surface that at least one juror fought sleep in its opening days, I thought it was fascinating. In a story about the Justice Department's Spring 2012 prosecution of a wide-raging municipal bond bid-rigging case, I called it the "first trial of the modern American mafia":
"Of course, you won't hear about the recent financial corruption case, United States of America v. Carollo, Goldberg and Grimm, called anything like that . . . But this just completed trial in downtown New York . . . allowed federal prosecutors to make public for the first time the astonishing inner workings of the reigning American crime syndicate, which now operates not out of Little Italy and Las Vegas, but out of Wall Street."
Dominick Carollo, Steven Goldberg and Peter Grimm were mid-level players who worked for GE Capital. They were involved in a wide-ranging scheme (one that also involved most of America's biggest banks, from Chase to BOA to Wachovia) to skim billions of dollars from America's cities and towns by rigging the auctions banks set up to help towns earn the highest returns on the management of municipal bond issues.
The case was over 10 years in the making and involved offenses that took place long before the 2008 crash. All three defendants were convicted in May 2012, with Goldberg ultimately getting four years and the other two getting three.
Now, they're all free. A New York federal judge last week ordered their convictions overturned in a quiet Thanksgiving-week transaction.
The GE Muni-riggers will now join such luminaries as the Gen Re defendants (executives from an insurance company who were convicted in 2008 of helping AIG conduct a fraudulent accounting transaction) and the KPMG defendants (executives of the U.S. arm of the Dutch accounting giant who were convicted in the 2000s of selling illegal tax shelters) in the ranks of Wall Street line-crossers who improbably made it all the way to guilty verdicts in criminal cases, only to be freed on technicalities later on.
As one antitrust lawyer I know put it: "Apparently, the government can't seem to get criminal trials involving financial executives (as opposed to, well, drug dealers) right. Go figure."
In this case, the defendants were shielded by the sheer complexity of the case. It would appear that the state took so long sorting through the mountains of recorded conversations and interviews to find the massive but well-camouflaged crime – these men, along with others like them in other banks, were using code words to rig the auction process so that banks and finance companies could collude and bid lower for city and town money management business – that the statute of limitations ran out on their own individual actions. When that happened, the Feds then switched up and charged them with different crimes related to what they claimed was an ongoing conspiracy, using continuing interest payments to establish the "ongoing" part of the indictment.
According to the lawyers for the three men, this allowed the government to unfairly bypass the statute of limitations. The lawyers for two of the men gave statements that recalled the heartwarming courthouse-steps speeches given by attorneys for genuine innocents, freed from prison after years of suffering by DNA results.
"We feel gratified by the Second Circuit's order, which allowed Steve Goldberg to be freed in time for Thanksgiving with his family," said David Frederick, Goldberg's attorney.
There are two important reasons why Wall Street defendants tend to slink out of convictions more easily than, say, drug dealers or burglars. Both reasons showed loudly in this case.
One is obvious. The Wall Street types have better lawyers. They don't miss anything and they all have gigantic balls (or are paid to have them, anyway). In this case, who knows, the court might even have been technically right in its decision. But it needed to be led there by lawyers with the skill to pull it off.
The argument in this case was relatively straightforward, as the government itself admitted it missed the deadline to charge the defendants based upon their own actions. But in the KPMG case, for instance, the court had to be convinced that an official Department of Justice policy for securing cooperation from corporate targets – one originally dreamed up by Eric Holder in the Clinton years, incidentally – was inherently violative of defendants' rights to counsel. That was a long bomb of a legal argument and in that case the KPMG lawyers hit the court right in the hands.
So unlike street-crime cases – where prosecutors screw up all the time but overworked defense counsel rarely have the time or the resources to call them on their mistakes – in these finance-sector cases, no error ever goes unnoticed.
It's one of the reasons prosecutors don't like to bring these cases at all. You make one misstep, and the whole case goes away – in this case, 10 years of work by God knows how many lawyers and investigators goes down the drain, with the snap of a finger. Imagine the last time you lost a paper thanks to a computer error, multiply that feeling by about 10 billion, and you might get close to grasping the horror of the DOJ prosecutors in this case this week.
The other reason these cases get overturned so much is equally obvious. These scandals are crazily complex. It's not just juries that have a hard time sorting them out. In many cases the crimes are so subtle, and the standard of proof to even call the crimes crimes is so high, that it takes years and years for investigators to build cases.
You can send a guy away for life on a murder charge based on a speck of blood and an old lady who saw a piece of a license number on a car screeching away from the scene. But you need to build a massive rhetorical case from scratch just to indict someone for being part of a nationwide bid-rigging conspiracy.
The crimes take place in a world unknown to ordinary people, so it is not unlike trying to explain a crime committed by aliens on another planet. In fact, the crime, in many cases, is not one that has even been seen in American courtroom before.
Judges need to be convinced they're not wasting their time. Juries need to be walked by the hand down a very deep rabbit-hole of inscrutable paper transactions and then literally trained on the fly to recognize evidence – these trials are often more like seminars than court cases.
So bringing these cases takes forever. This one took forever. And in the end, for these three anyway, it was all for nothing.
The Carollo, Goldberg and Grimm case was important on a number of levels. Many years from now, we will look back on this story that began as far back as the late Nineties and recognize in it an early, smaller-scale preview of the major global manipulation/collusion scandals that have already rocked the planet and will likely continue to do so in the years to come.
After all, the most dangerous possible consequence of the extreme concentration of financial power that has taken place in the last few decades has always been the possibility that these giants might figure out ways to work together, to game the costs of things for the rest of us. That's what took place in this case, as these defendants (and many big banks which have already settled with the state for similar actions) were caught colluding to skim from the investment returns owed to all of us local taxpayers.
Something similar also took place in the Libor case, and in the global currency exchange scandal now blowing up, and in numerous other manipulation cases (involving everything from metals to chocolate) already coming down the pipeline.
All of these cases will share the same features. The defendants, if there will be any, will have the best lawyers money can buy. And if they're charged at all, it will be for the most complex crimes imaginable, offenses so convoluted that it will take years to make cases.
This carries serious risks for anyone trying for justice, and we've just seen what those risks are. It's hard to put these guys away. It's even harder to keep them there.

Iran Sanctions Bites the US in the A** as Iran Responds With Petro Gold System!

Since June of 2012 I’ve been talking about Iran circumventing SWIFT and though it hurt their economy, initiating devastating inflation and great harm to the Iranian people, Iran has taken the hits from the sanctions but founded what could now be called the PETRO GOLD system.  It’s allowed Iran to sell oil to China, India and Japan for gold.
Iran was able to ship oil in shadow tankers, GPS turned off, receiving wheat, edible oils and gold in exchange. Dubai was a laundering point for the gold along with Turkey as a transhipment point the gold payments.
Iran proved this system worked and it dovetails nicely into China’s plans. This may have been one of the most important puzzle pieces that came out our sanctions.
The jailer may find he is a prisoner of his detainees when sanctions reverse course and bite the US in the a**.

By SD Contributor AGXIIK:
Since June of 2012 I’ve been talking about Iran circumventing SWIFT and though it hurt their economy, initiating devastating inflation and great harm to the Iranian people, Iran has taken the hits from the sanctions but founded what could now be called the PETRO GOLD system.  It’s allowed Iran to sell oil to China, India and Japan for gold.
Japan was hit hard by the US for such ‘deceitful’ action.  I think Abe got hauled to the coat closet but they were also forced to buy mucho US bonds to save us during the debt limit and sequester.  There have even been conspiracy rumors that Fukushima was punishment for Japan going off the reservation. So we smack Japan for trying to gain access to oil after the nuclear plant shut downs.   Japan is dying, not just because of Fukushima.   We don’t play nice with Japan but they’ve been a whipping post for quite a while.  They are making overtures to China, Sendaku Islands notwithstanding.  There’s oil and gas in them there islands.
Iran was able to ship oil in shadow tankers, GPS turned off, receiving wheat, edible oils and gold in exchange. Dubai was a laundering point for the gold along with Turkey as a transhipment point the gold payments.
Iran proved this system worked and it dovetails nicely into China’s plans. This may have been one of the most important puzzle pieces that came out our sanctions.  The jailer may find he is a prisoner of his detainees when sanctions reverse course and bite the US in the butt.
The enemy of my enemy is my friend and Iran, Syria, Afghanistan and Pakistan are the route for the nat gas and oil pipelines straight to China. We’ve been making asses of ourselves in each of these countries, one of which is a nuclear power with maybe 100 bombs.  The Paki bomb is real and a real threat.  They may even sell to Saudi Arabia if Iran gets the bomb.
I do not see anything that has happening in the ME in the last two years that has benefited us.  With Obumble in charge that does not surprise me whatsoever.
I am pretty sure that Iran will break every part of the recently inked agreement. Iranians have been dealing with the west for 2,500 years.  They are pretty good at this game.    We may have sanctions that we can put in place in short order to punish Iran but they are pretty bulletproof from attack.  They’ve dealt with these sanctions for 18 months.  They get back their $8 billion in funds and keep enriching Uranium.
Maybe Israel and Saudia Arabia can step up an attack against the nuke facilities but Iran may have enough 20% purified uraium to make a couple of bombs in short order. I would not want to be in Jerusalem to find that out.  Sun Tsu would speak to the strategic advantage of having a couple of nukes up the mullahs sleeve.
This new treaty signed last week defangs Israel since the wording of the treaty, for those who don’t read closely, is a done deal, allowing Iran 6 months in which to pursue its nuclear goals while ‘playing nice’ in the ME sandbox.  I am of the opinion that Iran plans to be the power player in the ME and the House of Saud is in real trouble since their fields are flagging and Iran has cheap and abundant oil. If Israel goes it alone they will be pushed even further into the pariah box for violating a treaty signed by the P5 plus 1.
The long term US strategy has been to create a US(large caps/saud (small caps) hegemony with control over every ME country, assimilated for their natural resources. Yes, The Borg does come to mind.
Gold is being mined in quite a few countries of the MENA area but oil is still the King.  We look at the Middle East power struggle paradigm and the Precious Metals Matrix as things nearly indecipherable as the Sphynx, which is in reality little more than an intriguing pile of sandstone.
There is an old saying in journalism, and this site is some of the alt news journalism at its best, with wise people making their voices known.
We journalists can take a page from H.L., Hearst and their cronies when they went after the news.
Follow the real money;  precious metals, and your answers will come easily.
I enjoy reading Sun Tsu.  That he’s Chinese makes his words even more important.
I’d call him the Plato and Aristotle of  the art of war and the human condition.  If you want to know how the enemy thinks and will engage you, he has the answers for any matter in that realm.  The Art of War was required reading at our bank.  Nowadays I think required reading is Winnie the Pooh or Alice through The Looking Glass.
Eric Hoffer, our longshoreman philosopher, was quoted as saying.
What our government fears most they will use as a weapon against their enemy
Our government considers us, the vocal minority, as their adversaries, maybe even their enemies.  They ABSOLUTELY FEAR REAL MONEY and as another recent SD article puts it, the bond and currency markets have been manipulated for decades to suppress the price of precious metals.
What is best for us is the mortal enemy of our government.  Precious metals are that touchstone of truth and reality in this insane world of government propaganda, disinfo and agitprop.  Sun Tsu would have been proud of us Silver Doctor Irregulars, the army of the  people.
When a government is small, they should fear us. When a government is large, we fear the government  This is not the way it should be, particularly in this country, founded of, by and for the people.
This heinous, illegal criminal enterprise must be ripped out, root and branch, if we are to change the game, the playing field and the paradigm of what used to be America. 
This country has devolved into little more than the USSA-WTF LLC.

Horrific Consequences: “People Don’t Understand the Scale of the Emergency That’s Going On Right Now”

Back in the mid-2000′s, when jobs were plentiful and everyone was concerned with buying zero-interest homes, new cars and taking luxury vacations, Mike Maloney from the Hidden Secrets of Money was warning of the financial and economic destruction to come. In his assessment, a crisis was imminent:
First the threat of deflation (1), followed by a helicopter drop (2), followed by big reflation (3), followed by a real deflation (4), and then followed by hyperinflation (5),
We now know that Maloney was right.
In 2008 we saw asset valuations from stocks to commodities lose significant value. It was a deflationary impact so threatening that the U.S. government was on the brink of a collapse which sunsequently led to members of Congress being warned that if nothing was done there would be tanks on the streets of America. This was followed by an unprecedented bailout package, which included an astronomical infusion of cash by the Federal Reserve under the direction of Chairman Ben Bernanke. Since then we’ve seen a massive reflation in a system where the economic fundamentals have only gotten worse – stock markets have hit all time highs, home prices have seemingly re-stabilized and personal debt is approaching 2007 levels.
Mike’s first three stages have, without a doubt, now come to pass.
If his forecast is correct – and it sure seems like it – then we will soon enter the next stage of this crisis and it will involve yet another deflationary hit to global asset prices. We know how destabilizing such an event can be from our country’s experience during the Great Depression. But as Mike notes in a follow-up to his original forecast, the next event will be nothing like what we saw during the 1930′s:
I think it’s going to be a whole lot worse than the 30′s…
People don’t understand the scale of the emergency that’s going on right now. 
They think that Ben Bernanke fixed things and that the economy is back on track, but the Fed is still doing emergency measures. They’re printing $85 billion a month – that’s over a trillion dollars a year… and people do not grasp the scale of the emergency measures that they’re doing right now.
There was just a little over $800 billion of base money in existence before the crisis in 2008… that’s 200 years worth of currency creation… So that’s 0.8 trillion… now we create a trillion every year… that means we’re creating more than 200 years of currency every single year
…For him [Bernanke] to say that they’re not going to taper is an admission that they can never, ever taper… If they do the whole thing comes crashing down.
I think the crash of 2008 was just a speed bump on the way to the main event… the consequences are gonna be horrific… the rest of the decade will bring us the greatest financial calamity in history.

If Maloney is right, then the next crash is going to be followed by something so severe that many have suggested our civilization may not survive in its current form.
Hyperinflation on this scale, originating in the United States, will lead to immediate global consequences. First, our systems of commerce break down. Next, the government will be left with no choice but to implement a state of martial law, something they have been war-gaming for years in anticipation of this very event. And finally, as noted by many contrarian experts, the world could very rapidly descend into widespread global conflict.
We are, by all measures, on the very precipice of what is potentially the most enormous financial, economic, and social collapse in the history of the world.
Both scenarios – deflation and inflation – are going to impoverish this nation and make it nearly impossible for people to acquire the basic necessities for life. One hundred million people are already struggling right now and are only capable of paying their rent and putting food on the table because of direct government assistance.
When the system collapses that assistance will not be enough and those who failed to prepare by stocking long-term food stores, gold and silver, and barter supplies are going to be living in horrific conditions.
This is big – and most people are completely ignorant to the possibility.

Iceland PM tells failed banks to pay up

Following his controversial announcement on November 30th to wipe 150 billion króna off household mortgage debt, the Icelandic prime minister now intends to pass the bill on to the failed banks.
Sigmundur Davíð Gunnlaugsson has said it’s time to speed up the exit strategy of recovery programs for Glitnir Bank hf and Landsbanki, under supervision of committees comprising of foreign creditors. This will help the country ease capital controls that are hampering the country’s progress.
He also intends to start taxing these banks as a ‘natural next step’ towards raising money to offer relief to ordinary Icelanders who have suffered financial pressure since their collapse in 2008. This proposal will see banks paying 0.366 per cent on debt instead of the present 0.041, affecting their creditor’s pockets as well. Previously he hinted that these creditors would have to take a write-off hit as well.
“When the failed banks collapsed in 2008 it was at a tremendous cost for the society as a whole,” Finance Minister Bjarni Benediktsson said in an interview. “Similar companies in other countries, which have been either resurrected or saved by the government, have had to pay much increased taxes and, in some countries, fines.”
But the banks, not all of whom had to be saved, have hit back, complaining in a letter to parliament that it violates the constitution. The Financial Services Association in Reykjavik says banks have forgiven $2 billion in debt since 2008, which is extremely generous relative to the nation’s GDP.

Stunning Chart: Today’s Stock Market is Eerily Reminiscent of 1929…

With the Holiday shopping season off to a slow start according to preliminary retail sales numbers and with the stock market sitting near all time highs, one can’t help but wonder what will happen when investors realize the economy isn’t really doing as well as we’ve been told by the experts.
The evidence suggests that we can expect devastating global economic changes in 2014 as a result of our national debt, further impoverishment of the working class, and massive new tax burdens resulting from President Obama’s health care legislation. The fundamentals, by most accounts, are indicative of an economy on the cusp of a total detonation within the next year.
Now, with the prospect of an abysmal shopping season for retailers because of tapped out consumers, the first quarter of 2014 could cause serious problems in financial markets as a result of lackluster performance in corporate earnings.
What’s more, the trajectory of our stock markets over the last eighteen months has been eerily reminiscent of markets back in 1929, right before the crash that led to a decade’s long depression in America.
Ken Jorgustin of Modern Survival Blog writes:
Is there a major financial crash in our near future? You must check out this stunning analogy between the current day Dow Jones Industrial Index compared with the time period 1928-1929 leading up to the memorable stock market crash…
The pattern of stock price movements looks VERY close to the lead-up to the 1929 top.
A lead-up to just any old top is one thing, but the 1929 top was followed by a memorable decline, which makes it all the more worthy of our attention…
Ken stops short of predicting that stock markets will do the same thing this January as they did in 1929, but take a look at this amazing comparison and decide for yourself if it’s possible that this whole thing will break wide open on or around January 14th of 2014:
Chart by McClellan Financial Publications via Modern Survival Blog
Could be nothin’… But what if?

EU Commission fines banks $2.3 billion for benchmark rigging

BRUSSELS Wed Dec 4, 2013 12:34pm EST
(Reuters) - EU antitrust regulators vowed to keep investigating rate- rigging on Wednesday as they slapped a record 1.7 billion euro ($2.3 billion) penalty on six financial institutions including Deutsche Bank, RBS and JPMorgan.
The fines by the Commission, which along with authorities around the globe has been examining the manipulation of London interbank offered rate (Libor) and its euro equivalent Euribor, takes the tally of penalties related to the scandal to almost $6 billion.
Confirming what a source familiar with the matter had previously told Reuters, EU Competition Commissioner Joaquin Almunia said he had been shocked at the scale of the scam and was sending a clear message that Brussels would fight and impose sanctions on cartels.
Deutsche Bank, which has yet to be fined by U.S. and UK regulators as part of separate investigations into benchmark interest-rate fixing, received the highest fine of 725.4 million euros.
Germany's largest lender and RBS were fined for their involvement in both the Euribor and Libor cartels.

Bitcoin developer confirms he's working with Gov. to give control/power to US Gov.

Transparency: Bitcoin

I can't embed the video here but please go to the link below- starting at the 15 minute mark and paying special attention to  what is said from 21: till the end of that segment of the show!!

Thanks to my buddy who gave me the heads up on this!!

Just an addendum to your post on Bitcoin. Bitcoin developer Jeff Garzik explicit confirms on TV he is working with government and keeps updating the bitcoin protocol often to give control and power to US goverment.
Please watch the video starting at 15:30

Peter Schiff: Holding the Dollar Could be Riskier Than Stocks

World Trade Organization In Crisis – The WTO Is A Western Cartel That Emerging Countries Are Beginning To Resist

The upcoming World Trade Organization summit in Indonesia will define the capacity of the organization to oversee global trade rules.
Full Story:
Security is tight on the Indonesian island of Bali as trade ministers from the World Trade Organization gather for a four-day meeting.
The meeting is crucial for the future of the World Trade Organization, or WTO.
Last week on Monday marathon talks were finally brought to a close in Geneva, Switzerland, without a consensus being reached.
It is thought that if now the trade ministers of the 159 member states still cannot thrash out an agreement, the WTO will gradually slide into irrelevance.
In this scenario, regional trade agreements will take precedent, and the WTO’s role as custodian of the world’s trade rules will slowly decline.
The meeting in Bali is an attempt to create a global trade agreement, the first since the WTO was created in 1995.
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Our story starts with Benjamin Franklin; self-made man, publisher, author, and inventor, who was world famous for his proof that lightning is just static electricity. He was the star celebrity of the world of his age and doors to the rich and powerful were always open to him, as having the eminent Franklin at ones social soiree was quite prestigious, even for a King! So it was inevitable that as the American colonies started to organize their own government, that Ben Franklin was appointed in 1757 as Pennsylvania ambassador to the Court of Saint James, then presided over by King George III.

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While in London, Ben Franklin witnessed first hand the extreme poverty of the ordinary British subject, later immortalized in literature by Charles Dickens.

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When the King's Court asked Ben Franklin how the colonies dealt with their poor and unemployed, Franklin shocked them when he replied that the colonies simply did not have a great many poor and unemployed. At the time, the law in England required that everyone conduct all the commerce using bank notes from the then-privately owned Bank of England (Britain was forced to nationalize the bank following Bretton Woods and the decline of the British Pound as the global currency). The bank notes were loaned at interest so that the Bank of England grew richer and richer and the people poorer and poorer, no matter how hard they worked.
Ben Franklin pointed out that the colonies had wisely avoided this problem by simply issuing their own currency which circulated through commerce interest-free, that is to say without a portion of the profits of business and labor automatically going to the bankers via interest on those bank notes.
By means of this simple device of currency that did not charge interest while in circulation, there was always adequate currency in circulation to provide full employment, and the American colonists were prosperous to a high degree almost unimaginable to their brethren consigned to squalor and toil in England.
Needless to say, Franklin's comments ignited a fierce discussion among the British subjects as to why their own economy did not operate on what was clearly a better system for the people. This in turn infuriated the owners of the Bank of England who decided the American system of interest-free public currency needed to be destroyed. So the bankers prevailed upon King George III to issue the Currency act of 1764.
This act ordered the American colonies to thenceforth conduct all commerce ONLY using bank notes borrowed at interest from the Bank of England. And as a (desired) result, the ordinary people of the colonies were rapidly plunged into the same poverty and mass unemployment as the ordinary people of Britain, by being forced by their government into permanent and irrevocable debt to the private bankers.
Now, you probably were told in Public School that the American revolution was all about the Tea Tax and the Stamp Act, but in reality, it was the banker predations imposed by the Currency Act that fueled the anger that led to the Declaration of Independence and the American Revolution.
"The refusal of King George 3rd to allow the colonies to operate an honest money system, which freed the ordinary man from the clutches of the money manipulators, was probably the prime cause of the revolution." -- Benjamin Franklin, Founding Father
But bankers are nothing if not dedicated to their schemes to acquire your wealth, and know full well how easy it is to corrupt a nation's leaders. Just one year after Mayer Amschel Rothschild had uttered his infamous "Let me issue and control a nation's money and I care not who makes the laws", the bankers succeeded in setting up a new Private Central Bank called the First Bank of the United States, largely through the efforts of the Rothschild's chief US supporter, Alexander Hamilton. Founded in 1791, by the end of its twenty year charter the First Bank of the United States had almost ruined the nation's economy, while enriching the bankers. Congress refused to renew the charter and signaled their intention to go back to a state issued value based currency on which the people paid no interest at all to any banker. This resulted in a threat from Nathan Mayer Rothschild against the US Government, "Either the application for renewal of the charter is granted, or the United States will find itself involved in a most disastrous war." Congress still refused to renew the charter for the First Bank of the United States, whereupon Nathan Mayer Rothschild railed, "Teach those impudent Americans a lesson! Bring them back to colonial status!" The British Prime Minister at the time, Spencer Perceval was adamantly opposed to war with the United States, primarily because the majority of England's military might was occupied with the ongoing Napoleonic wars. Spencer Perceval was concerned that Britain might not prevail in a new American war, a concern shared by many in the British government. Then, Spencer Perceval was assassinated (the only British Prime Minister to be assassinated in office) and replaced by Robert Banks Jenkinson, the 2nd Earl of Liverpool, who was fully supportive of a war to recapture the colonies. Financed at virtually no interest by the Rothschild controlled Bank of England, Britain then provoked the war of 1812 to recolonize the United States and force them back into the slavery of the Bank of England, or to plunge the United States into so much debt they would be forced to accept a new private central bank. And the plan worked. Even though the War of 1812 was won by the United States, Congress was forced to grant a new charter for yet another private bank issuing the public currency as loans at interest, the Second Bank of the United States. Once again, private bankers were in control of the nation's money supply and cared not who made the laws or how many British and American soldiers had to die for it.
Once again the nation was plunged into debt, unemployment, and poverty by the predations of the private central bank, and in 1832 Andrew Jackson successfully campaigned for his second term as President under the slogan, "Jackson And No Bank!" True to his word, Jackson succeeds in blocking the renewal of the charter for the Second Bank of the United States.
"Gentlemen! I too have been a close observer of the doings of the Bank of the United States. I have had men watching you for a long time, and am convinced that you have used the funds of the bank to speculate in the breadstuffs of the country. When you won, you divided the profits amongst you, and when you lost, you charged it to the bank. You tell me that if I take the deposits from the bank and annul its charter I shall ruin ten thousand families. That may be true, gentlemen, but that is your sin! Should I let you go on, you will ruin fifty thousand families, and that would be my sin! You are a den of vipers and thieves. I have determined to rout you out, and by the Eternal, (bringing his fist down on the table) I will rout you out!" -- Andrew Jackson, shortly before ending the charter of the Second Bank of the United States. From the original minutes of the Philadelphia committee of citizens sent to meet with President Jackson (February 1834), according to Andrew Jackson and the Bank of the United States (1928) by Stan V. Henkels
Shortly after President Jackson (the only American President to actually pay off the National Debt) ended the Second Bank of the United States, there was an attempted assassination which failed when both pistols used by the assassin, Richard Lawrence, failed to fire. Lawrence later said that with Jackson dead, "Money would be more plenty."
Finally, in 1913, the Private Central Bankers of Europe, in particular the Rothschilds of Great Britain and the Warburgs of Germany, met with their American financial collaborators on Jekyll Island, Georgia to form a new banking cartel with the express purpose of forming the Third Bank of the United States, with the aim of placing complete control of the United States money supply once again under the control of private bankers. Owing to hostility over the previous banks, the name was changed to "The Federal Reserve" in order to grant the new bank a quasi-governmental image, but in fact it is a privately owned bank, no more "Federal" than Federal Express. Indeed, in 2012, the Federal Reserve attempted to rebuff a Freedom of Information Lawsuit by Bloomberg News on the grounds that as a private banking corporation and not actually a part of the government, the Freedom of Information Act did not apply to the "trade secret" operations of the Federal Reserve. 1913 proved to be a transformative year for the nation's economy, first with the passage of the 16th "income tax" Amendment and the false claim that it had been ratified.
"I think if you were to go back and and try to find and review the ratification of the 16th amendment, which was the internal revenue, the income tax, I think if you went back and examined that carefully, you would find that a sufficient number of states never ratified that amendment." - U.S. District Court Judge James C. Fox, Sullivan Vs. United States, 2003.
Later that same year, and apparently unwilling to risk another questionable amendment, Congress passed the Federal Reserve Act over Christmas holiday 1913, while members of Congress opposed to the measure were at home. This was a very underhanded deal, as the Constitution explicitly vests Congress with the authority to issue the public currency, does not authorize its delegation, and thus should have required a new Amendment to transfer that authority to a private bank. But pass it Congress did, and President Woodrow Wilson signed it as he promised the bankers he would in exchange for generous campaign contributions. Wilson later regretted that decision.
"I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is now controlled by its system of credit. We are no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men." -- Woodrow Wilson 1919
It was at this time that public schools in the United States shifted the history of the American Revolution away from the Currency act, lest some sharp student ask why the nation was now back under the exact same form of banking that revolution had been fought to free us from.
As President, John F. Kennedy understood the predatory nature of private central banking. He understood why Andrew Jackson fought so hard to end the Second Bank of the United States. So Kennedy ordered the US Treasury to issue a new public currency, the United States Note.

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Kennedy's United States Notes were not borrowed form the Federal Reserve but created by the US Government and backed by the silver stockpiles held by the US Government. It represented a return to the system of economics the United States had been founded on, and was perfectly legal for Kennedy to do. All told, some four and one half billion dollars went into public circulation, eroding interest payments to the Federal Reserve and loosening their control over the nation's money supply. Five months later John F. Kennedy was assassinated in Dallas Texas, and the United States Notes pulled from circulation and destroyed (except for samples held by collectors). John J. McCloy, President of the Chase Manhattan Bank, and President of the World Bank, was named to the Warren Commission, presumably to make certain the banking dimensions behind the assassination were concealed from the public.
Now we are once again hearing the politicians in Washington DC wail and moan about the need to raise the government's debt ceiling. The debate is framed by the servile corporate media as whether we should or should not, because the really important question Americans need to ask is why the government is in such debt to begin with. And the answer (which the federal Reserve hopes you never realize) is really quite simple. When you have a privately-owned central bank issuing the nation's currency as a loan at interest, by design the debt always exceeds the available money supply. There is no way to ever pay the debt off, which is why the whole system is a trap. The moment that first pretty printed piece of paper was loaned into circulation..
... more money is owed to that bank than is actually in existence. It doesn't matter how hard the people work, how much they pay in taxes, or how much they sacrifice, they can never get out of that debt ... as long as they play by the rules the private central banks created, like the money itself, out of thin air.
So, as this debate about raising the debt ceiling starts up again, remember that the reason the corporate media is so focused on whether the debt ceiling should be raised or not, is because they don't want you thinking about why there is such a huge debt to begin with.
The question both government and the corporate media will never ask, and hope you do not ask, is why, when the Constitution authorizes the US Government to create and issue debt-free money, has the United States Government borrowed instantly-created money at interest from a privately-owned central bank and cursed you and your descendants with the out of control interest?
But that IS the question you need to ask yourself, your family and friends, indeed everyone you know.
Why, when the Constitution authorizes the US Government to create and issue debt-free money, has the United States Government borrowed instantly-created money at interest from a privately-owned central bank and cursed you and your descendants with the out of control interest, for the last 100 years?

Federal Gas Tax Hike To Double!

Amid Climate Crisis, Big Business Keeps Eye on Prize: Profit

Shell, a co-owner of the Motiva oil refinery in Port Arthur, Tex., has added climate-related carbon taxes to its long-term budgets. (Michael Stravato for The New York Times)Though the politicians continue to deny its possibility, some of the world’s largest corporations (many of them also its biggest polluters) are already planning for the likelihood of a carbon tax or other financial penalty for industry-generated emissions that are leading the globe towards climate catastrophe.
As the New York Times reports on Thursday:
A new report by the environmental data company CDP has found that at least 29 companies, some with close ties to Republicans, including ExxonMobil, Walmart and American Electric Power, are incorporating a price on carbon into their long-term financial plans.
Both supporters and opponents of action to fight global warming say the development is significant because businesses that chart a financial course to make money in a carbon-constrained future could be more inclined to support policies that address climate change.
In a related but separate development, Inside Climate News reported earlier this week how Bloomberg financial services has introduced a new tool for professional analysts and traders who are already calculating how “companies might fare in the carbon-constrained economy” if and when some of the world’s largest energy companies are forced to leave untapped fossil fuels reserves in the ground.
As ICN’s Elizabeth Douglass reported:
In a move that underscores Wall Street’s growing unease over the business-as-usual strategy of the world’s fossil fuel companies, Bloomberg L.P. unveiled a tool last week that helps investors quantify for the first time how climate policies and related risks might batter the earnings and stock prices of individual oil, coal and natural gas companies.
The company’s new Carbon Risk Valuation Tool is available to more than 300,000 high-end traders, analysts and others who regularly pore over the stream of information that’s available through Bloomberg’s financial data and analysis service. The move significantly broadens and elevates the discussion of “stranded” or “unburnable” carbon reserves—expanding it beyond climate groups and sustainability investors to the desks of the world’s most active and influential investors and traders.
“It demonstrates that there’s demand for the information—more and more investors are interested in these issues,” said Ryan Salmon, senior manager of the oil and gas program at Ceres, a nonprofit that organizes businesses, investors and public interest groups interested in climate change and other issues.
But just because the world of business is proving more capable of analyzing what the scientific community has been saying in their warnings about climate change and globale warming, it doesn’t necessarily translate that the world’s mega-corporations will follow the policy solutions offered by the environmentalists, new economy advocates, and the endless train of sustainability experts who describe a vision of a new energy paradigm that upends the centralized hold of big business and the burning of dirty carbon-filled fossil fuels.
Even if the companies cited by the Times, including oil giant ExxonMobil, agree to a carbon tax, the terms under which they might accept such a scheme would likely not include agreements to leave huge reserves in the ground.
Unfortunately, according to the scientific consensus, that is exactly what must happen, carbon tax or not.
As recent research by Oil Change International shows, fossil fuel reserves are actually increasing even as what scientists call the “global carbon budget”—the amount of carbon the atmosphere and oceans can absorb—is rapidly shrinking.
“The first rule of holes is simple: when you’re in one, stop digging. We are in a huge hole when it comes to the climate and yet we continue digging our way to climate catastrophe,” said Stephen Kretzmann, Executive Director of Oil Change International. “There is no logical reason to continue expanding our fossil fuel reserves; doing so only continues to line the pockets of Big Oil, Gas and Coal executives while putting our communities and planet in peril.”
Kretzmann’s group calls for an end to fossil fuel subsidies as a way to signal to the big polluters that their support from government is over.
Instead, say experts, that same money should be used to invest in new sustainable forms of energy. Until truly cleaner forms of energy like wind and solar can compete with oil, coal, and gas economically, experts say that there is no way to convince politicians to end the extraction policies of the fossil fuel giants.
As one investment fund expert explained to Douglass: “I’ve talked to quite a few oil and mining companies about stranded assets, and the most consistent message that the companies give is ‘we’re not worried about stranded assets, because if you look at the [International Energy Agency] forecast, the Wood Mackenzie forecast and the BP Energy Outlook, demand is going to keep growing for coal and for oil up to 2030 or 2040. So this is not an issue.’”
In the end, companies like Exxon are about profit and little else. As the New York Times reports:
ExxonMobil, which last year was ranked by the Fortune 500 as the nation’s most profitable company, is representative of Big Oil‘s slow evolution on climate change policy. A decade ago, the company was known for contributing to research organizations that questioned the science of climate change. In 2010, ExxonMobil purchased a company that produces natural gas, which creates less carbon pollution than oil or coal.
ExxonMobil is now the nation’s biggest natural gas producer, meaning that it will stand to profit in a future in which a price is placed on carbon emissions. Coal, which produces twice the carbon pollution of natural gas, would be a loser. Today, ExxonMobil openly acknowledges that carbon pollution from fossil fuels contributes to climate change.
“Ultimately, we think the government will take action through a myriad of policies that will raise the prices and reduce demand” of carbon-polluting fossil fuels, said Alan Jeffers, an ExxonMobil spokesman.
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 License.
Source: Common Dreams

Ron Paul: Bitcoin could ‘destroy the dollar’

Imagine a world in which you can buy anything in secret. No banks. No fees. No worries inflation will make today’s money worth less tomorrow.
The digital currency Bitcoin promises all these things. And while it’s far from achieving any of them — its value is unstable and it’s rarely used — some have high hopes.
“There will be alternatives to the dollar, and this might be one of them,” said former U.S. congressman Ron Paul. If people start using bitcoins en masse, “it’ll go down in history as the destroyer of the dollar,” Paul added.
Read more

Doc & Turd: Paper Metals Prices Can’t Go Much Lower

Jason Burack of Wall St for Main St was able to interview Turd Ferguson of TF Metals Report and ‘Doc’ of Silver Doctors for a 30+ minute round table discussion on gold, silver, inflation and the macroeconomic outlook for the US.
To start off the interview, Jason asks Turd, a longtime veteran of working in finance, his opinion of the technicals of gold and silver and if he thinks gold will retest its 1180 support level, if it will hold and if that will form a strong double bottom on the charts.
Jason asks Doc and Turd about the supply/demand fundamentals for gold and silver and if anything has materially changed.
Finally, Jason asks the guests about inflation in the US and globally and how long the current monetary, economic and financial systems can continue with rampant asset price inflation in nearly every asset class and the developing world getting destroyed with increasing inflation.

In The Bankers’ End Game, Bubbles Replace Growth

Watch video

‘Low Pay Is Not OK’: Fast Food Workers Rise Up with Nationwide Protests

Fast food workers and their supporters protest outside a McDonald’s before dawn in Chicago as a day of similar actions kicked off Thursday. “On strike. Shut it down! Chicago is a union town!” read the twitter message attached to this photo. (Credit: @fightfor15 / Twitpic)Worker strikes and public protests outside fast food restaurant chains are kicking off across the country on Thursday as low-wage employees in the industry are demanding a federal living wage of $15 an hour.
Organizers for the day’s events include the groups Low Pay Is Not OK, Fast Food Forward, Fight for 15:
Those groups are being supported by various local, regional, and national workers rights groups and labor organizations who all agree that stagnant wages across all fifty states are keeping huge segments of the population trapped in poverty while the giant fast food corporations who make huge profits while dodging taxes and paying their executive exorbitant salaries can afford to pay more.
Organizers created this tool to help individuals locate protests that might be in their area and received support for their efforts from former U.S. Secretary of Labor and economist Robert Reich, who released this video to explain why workers are right to be making their demands for a $15 wage:
With actions expected in over 100 cities, the Twitter hashtag #FastFoodStrikes is being used to post updates and photos throughout the day:

Blaming Black People in Detroit

Detroit has been delivered to the bankruptcy vultures, with a foreign bank first in line to scavenge the carcass. Yet, corporate media and white public opinion appear to consider the catastrophe to be the fault of Black “shiftless bums who must pay a price for just about anything that the reptile racist brain can imagine.”
The level of hostility that most white Americans have towards black people is endless. Nothing proves that point like the reaction to the court decision which affirmed that Detroit, Michigan is officially bankrupt. If the media, pundits and readers commenting to newspapers are to be believed, Detroit had no problems other than having too many freeloading black people living within the city limits.
According to news reports the damage done by moving money and other resources to the mostly white suburbs was not a problem. Neither were the disastrous Wall Street derivativesdeals which robbed the city. The Republican takeover of the state legislature wasn’t an issue either, despite the fact that the emergency management plan was instituted against the wishes of Michigan voters who rejected it in a referendum. According to conventional wisdom none of these factors and none of the bad actors are responsible for the decision to make the people of Detroit liable for the connivance of the 1%.
The corporate media say nothing about the fact that Barclays bank gets paid first, so that it can then pay Bank of America and others. They say nothing about how creditors from civil litigants to vendors will have to settle for pennies on the dollar. They don’t mention that city of Detroit retirees couldn’t pay into Social Security and have nothing to live on except their soon to be decimated pensions. Of course they also fail to say that the state’s constitution specifically protects pensions from cuts announced by the emergency manager. That law is no longer worth the paper it is written on.
The dice were cast long before judge Steven Rhodes ruled that the picking clean could begin in earnest. There was no way that the ruling classes would permit true democracy to function when there was a fresh carcass to scavenge. The evil doing was made all the more easy by a system still fueled by heavy doses of racism.
In 2008 the mortgage-backed securities house of cards fell apart but the international banksters weren’t prosecuted or even really blamed by the masses of people. In the minds of too many white Americans, the housing bubble was caused by black people buying homes they couldn’t afford. That same line of reasoning says that Detroit is bankrupt because of overpaid city workers and greedy retirees. Some of those black people who worked on automobile assembly lines were also blamed for the struggles of the big three car makers. Even black people who have jobs are considered shiftless bums who must pay a price for just about anything that the reptile racist brain can imagine.
The terror of the shock doctrine is now in full force around the country. The word Detroit is now being used the way the word boogeyman was used to keep children fearful and compliant. In New York City, municipal workers are being told not to expect retroactive wage increases when a new mayor takes office in January. After all, no one wants New York to end up like Detroit.
But racism is a two edged sword, capable of hurting white people, too. Black people may be punished first but the swath of destruction won’t leave white people untouched for long. Black people are the most vulnerable and the easiest to victimize but are not the only Americans depending on pensions to survive. Judge Rhodes made history and in a terrible way. There will be nothing to protect the few Americans who still have defined retirement benefit plans. They can now begin kissing those plans good-bye.
Cities and counties all over the country were defrauded by the derivatives schemers. Corporate greed will ensnare many more and make a mockery of the idea that America is a democracy. Other state legislatures and municipalities will also reach figurehead status and other voter referendums will be rendered null and void.
California cities like Stockton and San Bernardino are in court seeking bankruptcy protection. So far unions have successfully argued that pension plans should be untouched, but with Rhodes’ ground breaking decision, all that may change very quickly. It is certain that the rest of financial services sector sat up and took notice when Detroit’s fate was sealed in the court house.
Detroit is now the dead canary in the coal mine. The banksters have taken jobs, homes and now a major city. Legislation and the popular will mean nothing when the fat cats set their sights on something they want.
As for the few people left in Detroit they will watch as their pensions, jobs and public resources disappear. They will be the first to see such a level of theft and devastation but they will not be the last.
Margaret Kimberley‘s Freedom Rider column appears weekly in BAR, and is widely reprinted elsewhere. She maintains a frequently updated blog as well as at Ms. Kimberley lives in New York City, and can be reached via e-Mail at Margaret.Kimberley(at)
With permission
Global Research
Black Agenda Report

Google Seeks Market Share in Growing Robotics Industry

Nicholas West
Activist Post

Robots are already outsourcing humans, but some robotics experts are predicting that 2045 will be the time when the last human worker receives his or her walking papers. It's an undeniable trend, as robots are set to move from the assembly line to the delivery and fulfillment areas with autonomous vehicles, and perhaps even a full-scale drone delivery system like that proposed by Amazon.

The fact that Google would be interested in the growing robot economy should come as no surprise, as we have seen their sustained commitment to concepts like augmented reality (Google Glass), despite the early over-reach that has sparked privacy concerns. And, indeed, they are announcing a major investment that entails a long-term plan for integrating robots into the future of their company, despite this being described as a "moonshot."

As a sign of just how serious Google is, tech site 33rd Square phrased Google's plans for new acquisitions as "swallowing up robotics companies" ... the seven that are seen as key to putting Google at the forefront of future development:

Over the last half-year, Google has quietly bought up seven technology companies in an effort to create a new generation of robots. The engineer heading the effort is Andy Rubin, the man who built Google’s Android software into the world’s dominant force in smartphones
It is suspected that the company’s robotics aims are in manufacturing — like electronics assembly, which is now largely manual — and competing with companies like Amazon in retailing, according to Markoff's sources. 
The companies Google has acquired are Schaft, a small team of Japanese roboticists who recently left Tokyo University to develop a humanoid robot for commercialization and for competition in the DARPA Robotics Challenge, and Industrial Perception, a U.S. start-up that has developed computer vision systems and robot arms for loading and unloading trucks. (emphasis added)

The key area clearly is humanoid robots which continue to evolve. The other companies being acquired are specializing in enhancing the "humanity" of robots:
Also bought out were Meka Robotics and Redwood Robotics, makers of humanoid robots and robot arms in San Francisco, and Bot & Dolly, a maker of robotic camera systems that were recently used to create special effects in the movie “Gravity.” A related firm, Autofuss, which focuses on advertising and design, and Holomni, a small design firm that makes powered caster wheels, were also acquired. 
The seven companies are capable of creating technologies needed to build a mobile, dexterous robot. Mr. Rubin told the New York Times he was also pursuing additional acquisitions. (emphasis added)
And in case anyone thinks that the idea of a humanoid robot is to serve purely as a human helper or even companion (or lover), the following quote indirectly targets the real issue - eliminating the human workforce:
“The opportunity is massive,” said Andrew McAfee, a principal research scientist at the M.I.T. Center for Digital Business tells Markoff. “There are still people who walk around in factories and pick things up in distribution centers and work in the back rooms of grocery stores.”
Yes, imagine that: people actually working ...

However, built into this trend is a strange dichotomy between theory and what would actually happen if all goes according to plan. Google's self-driving vehicles coupled with all of the elements of humanoid robots apparently anticipates a time when the consumer still has money to spend despite having been almost completely outsourced to robots. Furthermore, the unemployed are meant to understand the benefits of being fully integrated into the consumer data matrix from Internet browse to in-home assistance in order to facilitate purchases. This might seem fanciful, but here is one scenario offered from Extreme Tech:

A robot represents the ultimate physical incarnation of Google’s until-now-digital mandate: find, retrieve, predict, assist. Doing these jobs in your browser necessarily brings Google into contact with rich and detailed information about how you live your life — which is of course Google’s only incentive to offer those services in the first place. Right now, Google can see what breakfast cereal you search for online or mention on social media; a Google robot could simply observe which box you grab off the shelf, or remember which it bought for you on its last trip to the grocery store. An in-home listener could correlate your online statements with your private actions or word choices — do open Democrats mention war more or less often than open Republicans, and in which contexts? More importantly: which campaign would pay more for the privilege of knowing, or to block their competitors from knowing the same data? 
These might seem like conspiracy theories or doomsday scenarios, but this is simply Google’s business; from rolling out new super-phones to laying down new lines of fiber optic cable, it has always seen hardware as the tiresome but necessary vehicle for its true service: data. (Source)
How a rapidly diminishing workforce could possibly remain a sustainable consumer base is yet to be fully detailed. One thing is for certain, though: Google has to be working on it.

For some insight into what is coming and how to maintain some humanity and usefulness within an economy set to drastically transform over the next 10 years, please watch this key documentary:

21 Images of Where Children Sleep Around the World

21, images, of, where, children, sleep, around, the, world, paints, a, powerful, picture, of, inequality,
21 Images of Where Children Sleep Around the World Paints A Powerful Picture of Inequality

21, images, of, where, children, sleep, around, the, world, paints, a, powerful, picture, of, inequality,
21 Images of Where Children Sleep Around the World Paints A Powerful Picture of Inequality
- See more at:

Chinese currency overtakes euro in trade

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Stealing from Toys For Tots

TRI-CITIES, Wash. - KEPR learned toys for tots is no longer welcome at Walmart.

Workers at the superstore were accused of stealing from the donation program.

Walmart doesn't want to take the risk, so it won't allow any more donation bins in its stores.

The holiday season has always been about giving. Some Walmart employees are accused of taking. The superstore is fighting the suggestion its employees were helping themselves to toys in donation boxes.

Organizer Glen Carter, "People had been taking things out of the unattended boxes and Walmart didn't want it to be a problem."

The mega-store put a stop to donation bins. It came as a shock to Glen Carter.
He's in charge of collecting gifts for the Toys-For-Tots program. He was all set to put out donation boxes at Walmarts across the Tri-Cities until he got a call that put a stop to the efforts.

"Walmart, in the past, has been a great partner to work with you know, we're kind of sad to lose them," he said.

A great partner to the point that Glen says Walmart customers donated about half the toys that came in to the Toys for Tots program.

Close to 2000 local families signed up for help this year. While there are other drop boxes around town the charity is hoping to rebound.

When we talked to Walmart about these donation boxes they said it was a policy change but they are trying to reach out to the community in other ways.

Like offering parking lot space for "fill the truck events". Another reason, Walmart's solicitation policy also changed. They can no longer support multiple organizations at any given time.

As for the stealing, we asked the company directly.

We asked, "What does corporate have to say about the accusations of theft?" A spokesperson replied, "I think, it's inaccurate. Our associates from across the...all around the country help support local communities."

There are no confirmed complaints about toys being stolen from Tri-Cities donation boxes but the company didn't want to risk that.

Glen said," I really am afraid that we're going to have a short fall this year.

Leaving organizers hoping there would be enough toys for Christmas morning.

There are still a lot of places to donate toys and they definitely want your help.

You can drop off new toys at GESA, Toyota of Tri-Cities, Ashley Furniture and many other locations there's a link on KEPRTV.COM.

Deposit Confiscation Poses A Real Risk To Investors, Savers and Corporate Depositors (Part II)

by GoldCore
Today’s AM fix was USD 1,234.00, EUR 907.69 and GBP 754.79 per ounce.
Yesterday’s AM fix was USD 1,213.00, EUR 892.57 and GBP 741.13 per ounce.
Gold climbed $20.70 or 1.69% yesterday, closing at $1,243.40/oz. Silver rose $0.62 or 3.24% closing at $19.74/oz. Platinum climbed $20.75, or 1.5%, to $1,375.00/oz and palladium was also up  $13.97 or 2%, to $727.47/oz.

Gold bounced sharply higher yesterday as traders went long, leading to a bout of short covering. Gold looks very oversold according to the relative strength index and other indicators. Gold was also supported by the emergence of Indian demand as jewellery, coin and bar providers stocked up at these lower prices for the ongoing marriage season.
Ongoing speculation that data tomorrow may reinforce the case for the Federal Reserve to cut back on its radical $20 billion per week bond buying programme is making traders hesitant to go long.
This is leading to a lack of bullishness and animal spirits in the paper gold market. But the global physical market is seeing a different dynamic with continuing robust global demand and gold demand set for new records this year – particularly in China and Asia.
Indian gold premiums hit another record today, driven by low supplies to meet firm demand for weddings, which will continue until May. Local prices were $150 to $160 per ounce higher than London prices, compared with $125 earlier this week, traders said as reported by Reuters.
Shanghai gold closed at $1,259.88/oz, a premium of $22 over COMEX prices showing Chinese demand continues. Chinese New Year is on January 31, 2014, and we would expect to see renewed Chinese buying on this latest dip in prices.

Annual Chinese Gold Net Imports – 2001 to 2013 YTD
Chinese imports through Hong Kong alone are set to top 1,000 tonnes this year and this does not include other gold imports into China ex Hong Kong. Therefore, total Chinese gold demand could be as high as 2,000 tonnes. Total annual gold supply is expected to be around the 2,700 tonne mark. Therefore, China could swallow up nearly 75% of global gold mine supply.
It is important to note that the huge demand in tonnage terms, 1,000 tonnes and possibly as high as 2,000 tonnes, is only worth roughly $39 billion and $78 billion in dollar terms or nearly what the Federal Reserve is printing every single month since late 2012.
Why Bail-Ins Are Important To Investors, Savers and Corporate Depositors
‘From Bail-Outs to Bail-Ins: Risks and Ramifications’ is a research document about one of the most important risks facing investors, savers, corporate and all depositors today – bank and financial institution bail-ins.
Preparations have been or are being put in place by the international monetary and financial authorities for bail-ins of both banks but also other financial institutions. The majority of the public are unaware of these developments, the risks and the ramifications.

In March 2013, the EU and IMF spearheaded the restructuring of the troubled Cypriot banking sector. Although the terminology of bank ‘bail-ins’ first entered public consciousness during the Cypriot financial crisis of March 2013, the idea of bail-ins as a central bank rescue mechanism has been openly discussed for a number of years amongst international central bank policymakers.
Cyprus became the defining event since it revealed the preparations and planning of international banking regulators and governments at the highest levels for the coming ‘Bail-In Regime’.
The market’s expectation was that Cyprus would be similar to previous Eurozone rescue packages applied to economies such as Greece, Ireland and Spain, where banks had their losses ‘bailed-out’ by governments, with the bail-out cost and risk transferred to the sovereign nation and funded by the taxpayer.
However, the backlash from taxpayers and certain political parties and a vicious circle of sovereign bank-induced debt was leading to recessions and the possibility of an economic depression. This may have contributed to the international monetary authorities, central banks and governments altering the approach to burden sharing, pushing the losses onto bank depositors.
The important shift from bail-out to bail-in had not been signalled in a very public way. The market’s expectation was therefore confounded when Eurozone finance ministers imposed bail-ins on Cyprus. This forced bondholders to convert into shareholders, and critically, imposed an element of bank deposit confiscation and the forced conversion of these deposits into bank equity.
Never before in the public’s perception had bank deposits been countenanced as potential financing sources for the rescue of insolvent banks. The public was shocked by the freezing and confiscation of deposits and the use of them in a desperate attempt to prevent banks from failing.
While bail-in generally refers to a bank restructuring where shareholders and various unsecured creditors such as bondholders are forced to share the rescue costs, after Cyprus, the term ‘bail-in’ became synonymous with possible deposit confiscation, where uninsured depositors were seen as unsecured creditors of the bank and liable to share bank restructuring costs.
The coming bail-ins regimes will pose real challenges and risks to investors and of course depositors – both household and corporate. Return of capital, rather than return on capital will assume far greater importance.
Evaluating counterparty risk and only using the safest banks, investment providers and financial institutions will become essential in order to protect and grow capital and wealth.
It is important that one owns physical gold and not paper or electronic gold which could be subject to bail-ins.

Owning a form of paper gold and derivative gold such as an exchange traded fund (ETF) in which one is an unsecured creditor of a large number of custodians, who are banks which potentially could be bailed in, defeats the purpose of owning gold.
Physical gold, held in secure storage conferring outright legal ownership through bailment remains the safest way to own gold. Many gold investment vehicles result in the buyers having very significant, unappreciated exposure and very high counterparty risk.
Retail investors, retail savers, high net worth individuals, family offices, pension funds, charities, companies, corporations, corporate treasurers, financial advisors, accountants and anyone who manages money on behalf of clients need to consider the risks and ramifications of bail-ins.
Many in the financial services sector have paid lip service to diversification in recent years. This has led to many investors experiencing sub par returns and returns below the market rate of return. Those who have achieved real diversification involving owning international equities, high credit bonds, property, cash and gold have been protected from the recent volatility.
If there is a failure to observe the fundamental tenet of investing in the coming years – real diversification – we may be subject to further financial pain.
Conservative wealth management, asset diversification and wealth preservation are of paramount importance today.
Gold will again have a fundamentally important role to play in order to protect, preserve and grow wealth in the coming bail-in era.
Download our Bail-In Guide: Protecting your Savings In The Coming Bail-In Era(11 pages)
Download our Bail-In Research: From Bail-Outs to Bail-Ins: Risks and Ramifications (51 pages)