A video of some truth that they let slip into CNBC: Stay Clear of Western Markets and Currencies. Global investing analyst Martin Hennecke warns: "Sovereign debt crisis in the western countries is really getting underway..." and "The blow-up of sovereign debt is the final step of the financial crisis." Hennecke is also bullish on commodities and warns of a global financial meltdown with high interest rates and high inflation.



The Roadmap For Gold Posted: Apr 22 2010 By: Dan Norcini Post Edited: April 22, 2010 at 3:14 am
Filed under: Trader Dan Norcini
Dear Friends,
I highly recommend the following brief article particularly whenever you get another Elliot Waver with their gloom and doom forecast for Gold. Not only is the article a stunning read but it also is a road map to the history of gold over the next few years.
The main point of interest is the conclusion drawn by the author (who by the way is a former Treasury Department official under a Democratic President so his argument cannot be dismissed as merely a partisan rant), is that the US is headed for a debt crisis eerily similar to that which erupted in the last year of the Jimmy Carter Administration back in 1979. You will recall that is the year during which gold went on to hit an all time high near the $850 mark.
Note also that the author comes to the same conclusion that we have been stating for years now, namely, that the fiscal condition of the US makes a Dollar crisis almost inevitable unless draconian measures are enacted, which incidentally I might add, will slam the brakes on any nascent economic recovery.
Considering the fact that gold is trading in nominal terms near the $1145 level, which is almost 40% below the all time high CLOSING monthly price of gold when adjusted for inflation, the stage is clearly set for gold to run to heights that many currently would believe are incredulous. However, one must take into account, as the article correctly and clearly sets forth, that the deteriorating condition of the US fiscal condition has no comparison going as far back as record keeping began in the US in 1792. That alone, especially his notes on the fiscal condition of the US as related to WWII are most enlightening.
Print a copy of this article and post it on the wall referring to it often and then understand why we here at this site are so concerned about our future as a nation and why we keep saying that the price retracements in gold are mere blips on the long term radar screen.
Also rest assured that if we know this, so too do the large Central Banks and monetary authorities of the rising economic powerhouses of the East.
Trader Dan



MAKE SURE YOU SEE THIS CHART...
Click chart to enlarge today’s Inflation Adjusted Gold Price chart in PDF format

http://jsmineset.com/wp-content/uploads/2010/04/Inflation-adjusted-gold-3-31-2010.pdf



FT: U.S. Debt to Hit $20 Trillion in 10 Years Wednesday, 21 Apr 2010 08:51 PM
While the global financial system remains transfixed by the problems of Greece and several other European countries risking default over their massive debts, the real threat is whether the credit standing and currency stability of the world’s biggest borrower, the US, will be jeopardized by its disastrous outlook on deficits and debt.
That’s the fear raised in a devastating op-ed on the Financial Times website written by Robert Altman, a former deputy US Treasury secretary under President Clinton who is now chairman of Evercore Partner, a leading global advisory and investment firm.
“America’s fiscal picture is even worse than it looks,” Altman writes. “The non-partisan Congressional Budget Office just projected that over 10 years, cumulative deficits will reach $9.7 trillion and federal debt 90 percent of gross domestic product – nearly equal to Italy’s.
“Global capital markets are unlikely to accept that credit erosion,” Altman says. “If they revolt, as in 1979, ugly changes in fiscal and monetary policy will be imposed on Washington. More than Afghanistan or unemployment, this is President Barack Obama’s greatest vulnerability.”
The financial outlook for the United States is frightening. The size of the federal debt jis projected by the CBO to increase by nearly 250 per cent over 10 years, from $7.5 trillion to a whopping $20 trillion.
The only remote comparison to such a debt load in the World War II, a global conflict that killed 50 million people, Altman and other analysts have written.
But there is no real comparison even in the 1940s and 50s for such a rise in indebtedness – nothing remotely like it has occurred since record keeping began in 1792, Altman writes.
“It is so rapid that, by 2020, the Treasury may borrow about $5 trillion per year to refinance maturing debt and raise new money; annual interest payments on those borrowings will exceed all domestic discretionary spending and rival the defense budget,” Altman writes in the Financial Times.
More…





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TIME TO TRADE IN GOLDMAN SACHS FOR SACKS OF GOLD!
One Sold Fool's Gold; the Other Is Real and Reliable By Craig R. Smith, Chairman, Swiss America

Days before debate on a major Democratic bill to further control financial institutions was to begin, the Securities and Exchange Commission charged Goldman Sachs with civil fraud.The SEC accused this giant investment bank of marketing dodgy mortgages bundled with help from a hedger who made a billion dollars betting that these investments would lose value. Goldman Sachs clients lost at least $1 billion and, along with stockholders, might now sue the company. The SEC action is part of a populist campaign to demonize banks and Wall Street as Democrats try to regain independent voters and the far left. This populism could also help pass financial legislation, which as Mr. Obama said a year ago, aims to create a “wider recovery, a more stable system, and a more broadly shared prosperity,” i.e., a redistribution of income.
THE NEXT BIG GOV'T POWER-MONEY GRABThis proposed legislation contains permanent, unlimited bailout authority that Republicans say could make future bailouts of government-favored companies routine – one more step toward government picking winners and losers in our economy while sucking the capital out of capitalism. GOLD, meanwhile, remains what it has been since biblical times: a reliable store of value that government cannot devalue by printing more or by manipulating paper investments.One financial expert who knows this, ironically, is the hedger who helped create Goldman Sachs' dodgy mortgage bundles. He reportedly is heavily invested in SDPR Gold ETF and may have to liquidate to pay legal expenses, news that caused a downward blip in gold prices last week. Throughout history gold's value has stood tall when the schemes of greedy profiteers and politicians crumble, as they are now. In this time of economic earthquakes, when even the largest financial giants and the U.S. dollar have become unreliable, what diversified investment can you trust to provide security for your family – Goldman Sachs, or sacks of gold? You need to act now to add gold to your portfolio while your dollars and stocks still have some value.


Hope your pantry is full, or your wallet will soon be empty...Hint- read up on Weimar Germany and Zimbabwe...

U.S. Food Inflation Spiraling Out of Control

The Bureau of Labor Statistics (BLS) today released their Producer Price Index (PPI) report for March 2010 and the latest numbers are shocking. Food prices for the month rose by 2.4%, its sixth consecutive monthly increase and the largest jump in over 26 years. NIA believes that a major breakout in food inflation could be imminent, similar to what is currently being experienced in India.

Some of the startling food price increases on a year-over-year basis include, fresh and dry vegetables up 56.1%, fresh fruits and melons up 28.8%, eggs for fresh use up 33.6%, pork up 19.1%, beef and veal up 10.7% and dairy products up 9.7%. On October 30th, 2009, NIA predicted that inflation would appear next in food and agriculture, but we never anticipated that it would spiral so far out of control this quickly.

The PPI foreshadows price increases that will later occur in the retail sector. With U-6 unemployment rising last month to 16.9%, many retailers are currently reluctant to pass along rising prices to consumers, but they will soon be forced to do so if they want to avoid reporting huge losses to shareholders.

Food stamp usage in the U.S. has now increased for 14 consecutive months. There are now 39.4 million Americans on food stamps, up 22.4% from one year ago. The U.S. government is now paying out more to Americans in benefits than it collects in taxes. As food inflation continues to surge, our country will soon have no choice but to cut back on food stamps and other entitlement programs.

Most financial experts in the mainstream media are proclaiming that the recession is over and inflation is not a problem in the U.S. Unfortunately, they fail to realize that rising food and gasoline prices accounted for 58% of February's year-over-year 3.85% rise in retail sales. NIA believes price inflation is beginning to accelerate in many areas of the economy besides food and energy, and all increases in U.S. retail sales this year will be entirely due to inflation.

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