THE U.S. NATIONAL DEBT WILL HIT 13 TRILLION DOLLARS THIS WEEK...

Have you heard the audio from the S&P pits during the recent flash
crash? here it is. It still gives me chills for the duration every
time I listen to it. This is what it sounds like when investors loose 1 TRILLION DOLLARS in 8 minutes... it looks like this 1,000,000,000,000 yes thats 12 zero's...
This will be happening alot more often very soon. The ONLY way to protect yourself and family is to own physical precious metals as insurance...







A billionaire goes all-in on gold


Richard Russell, the editor of The Dow Theory Letter: You Won’t Recognize America by the End of the Year. Here are a couple of quotes: “Do your friends a favor… Tell them to get out of debt and sell anything they can sell (and don't need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won't recognize the country.” ... “Just as for years I asked, cajoled, insisted, threatened, demanded, that my subscribers buy gold, I am now insisting, demanding, begging my subscribers to get out of stocks… and get into cash or gold (bullion if possible).”





Volcker Says Time Is Running Out for U.S. to Tackle Fiscal Woe.





The Morality of the Financial Monetary System is Really What is Broken





Week's unemployment claims jump to 471,000





The true amount is 1 QUADRILLION 144 TRILLION DOLLARS worth of toxic waste...thats 1,144,000,000,000,000

Ticking Time Bomb: $600 Trillion in Derivatives at Risk





Next Year's Federal Budget Sinking in Deep Red Ink





Reforming Fannie and Freddie Will Slam Home Prices





The run on Gold and Silver has begun...Hope your ready...

Germany's 'Desperate' Short Ban Triggers Capital Flight to Switzerland





This is very temporary I can assure you...

Fading of Inflation Helps Buyers and Borrowers





Food Price Inflation to Spur Zombie Takeover


Your money is backed ONLY by the full faith and credit of the U.S. Government...
Now can you explain
1. exactly who it is that has any faith in the U.S. Government? not me...
2. exactly what credit does the U.S. Government have left besides the ability to print as much money as they want, backed by nothing???

FDIC Insurance Fund Still $20 Billion in the Hole Posted: May 21 2010 By: Greg Hunter Post Edited: May 21, 2010 at 1:04 pm
Filed under: USAWatchdog.com
Dear CIGAs,
While the stock market was beginning its 376 point plunge yesterday, the Federal Deposit Insurance Corporation was quietly putting the best face it could on a banking system in serious trouble. In a press release to update the status of the insurance fund, the big positive headline was, “FDIC-Insured Institutions Earned $18 Billion in the First Quarter of 2010–Net Income Highest in Two Years.” FDIC Chairman Sheila C. Bair said, “There are encouraging signs in the first-quarter numbers . . . Industry earnings are up. More banks reported higher earnings, and fewer lost money.” (Click here for the complete FDIC press release.)
I can appreciate Chairman Bair’s positive attitude, but “encouraging signs” do not mean we have turned the corner and brighter days are ahead. The Deposit Insurance Fund, or DIF, has a negative balance of -$20.7 billion. That is just a $200 million improvement from the all time record deficit of -$20.9 billion at the end of 2009. I don’t see how these numbers are “encouraging.”
I talked with FDIC spokesman David Barr yesterday about the shortfall in the DIF. He said, “The FDIC is not broke.” It has an additional “$63 billion in cash.” He told me there is about $46 billion in three years of prepaid deposit insurance premiums and an additional $17 billion in cash for a grand total of $63 billion in “liquid resources” to close insolvent banks. Let me get this straight–nearly 75% of the FDIC’s bailout money is from fees collected up front. What happens when the FDIC burns through that? Will they collect another 3 years of fees?
Barr told me the FDIC is expecting to spend “$40 billion” closing troubled banks in the next 12 months. He said, “It could be less and it could be more.” Simple math says it will be more, way more. There have already been 72 failed banks so far this year. According to Barr, at the same time last year, there were only 33 failed banks. In 2009, there were 140 total banks closed. Bar freely admitted, “The pace (of bank closings) is greater this year.” Barr expects more banks to fail in 2010 than 2009, but he would not give a number. He said, “We don’t provide numbers because to us it’s not the numbers, it’s the cost.” The latest list of “problem” banks from the FDIC now stands at 775. 73 banks were added to the list since the end of 2009. That is nearly a 10% increase in less than 5 months.
Reggie Middleton is an investor and analyst who owns BoomBustBlog.com. He was one of the earliest to warn of the impending downfall of Lehman Brothers and Bear Stearns. Middleton told me, “If the FDIC had more money and manpower, it would be closing a lot more banks.” Middleton also said, “Many of America’s 8,000 banks are insolvent or close to it because of mark to market accounting.” Because of accounting rule changes, banks are allowed to value toxic assets for whatever they think they are worth, not what they actually are worth. Some call this “mark to fantasy accounting.” Middleton warns, “There is more risk now (in the banking system) than during the Lehman crisis because the pool of banks is smaller.”
When I look at residential and commercial real estate, I see no “encouraging signs.” I see frightening headlines like the one that came out just this week that says, “One in 7 U.S. homeowners paying late or in foreclosure.” (Click here for the full story) Commercial real estate doesn’t look any better. Some experts are forecasting $1 trillion in CRE losses before the banking crisis is finished. The FDIC is acting more like the Resolution Trust Corporation of the early 90’s than a deposit insurance fund. Let’s hope it does not run out of money anytime soon.
More…

The Housing “Recovery” Is Just Another Government Subsidy, Says Whalen



Make sure you watch the video's in this article...

May 22, 2010 www.CaseyResearch.com
Weekend Edition
The Problems with Politibonics
Dear Reader,
While not the most awkward moment in my life, it certainly ranked right up there.
It happened at a supermarket checkout counter in Louisiana when a clerk asked me a question. While I know that she thought we were both speaking the same language – English – for the life of me, I had no idea what she was saying.
“Huejago wuanddab pwnwanr err psistic?”
“What?”
“Huejago wuanddab pwnwanr err psistic?”
“I’m sorry, I didn’t quite get it – could you try again?”
“Huejago wuanddab pwnwanr err psistic?”
“I’m really sorry,” I said in what I suspect was a plaintive voice. “My ears must be clogged, but I just don’t understand what you’re saying. One more time?”
“Huejago wuanddab pwnwanr err psistic?” she responded, her face tense. Then, clearly angry and frustrated, she held up a plastic bag in one hand and a paper bag in the other. The proverbial dime dropped.
“Ah, paper or plastic!” I said with an exhalation of deep relief.
“Dwats I bena sayn, huejago wuanddab pwnwanr err psistic?!”
Per the signature line of Cool Hand Luke, what we had been having was “a failure to communicate.” The situation in Louisiana came about because of a culturally motivated derivation of English that, in this instance, had the clerk speaking the vernacular referred to by some as Ebonics, effectively creating an entirely one-sided exchange. To wit, she could understand what I was saying, but I had no chance of understanding her, absent the aforementioned props.
I am sure that similar incidents occur between the English and the Scots – among many others around the globe – same language but inaccessible to one party to the exchange.
Today the global economy is suffering a far larger problem than paper or plastic, due, in no small part, to a misunderstanding of what is otherwise perceived to be a common language – the language of economics.
Whether through ignorance or deliberate obfuscation, what one person says when discussing the economy and investment markets and what another hears is far too often unintelligible or simply misunderstood in the extreme.
Case in point, here in the U.S., the government and its supporters tout that the all-important housing sector is in recovery mode. Many Americans will mistakenly view that news as they might a light switch: One day the housing market is weakening; then, with the flip of a switch, it is recovering.
However, a deeper analysis of the numbers reveals that the government is not only thickly gilding the lily but actually using a derivation of the term “recovery” that, when actually understood, should be something entirely different.
Perhaps I haven’t had enough coffee today, but I feel like what I just wrote might be a bit obtuse, so I’ll try to get the point across through the medium of video.
To that end, click the link below for a brief but clear interview with Chris Whalen during which he explains that what is being passed off as a housing recovery – evidenced by stats such as housing starts – is actually just an extension of massive government subsidies. Subsidies that now extend to actually paying builders to build homes for a market that has no demand.
Thus, instead of saying “recovery,” the government’s language would be far more accurate and far less misleading were it to say something more along the lines of, “additional deficit spending is adding to the massive overhang of unwanted houses on the market.”
No small difference. For the video click here.
As I don’t need to tell you, this is important because business owners or investors, on hearing of the recovery, are likely to make decisions based on a misunderstanding of the stats that could result in serious losses down the road.
In the case just mentioned, the public might think, “Happy days are here again,” and be tempted to buy stocks or even buy a house they have had their eye on. Yet, someone with a different, and more accurate, interpretation of the situation might sell stocks and buy gold, knowing that in time all this government propping-up won’t be able to resolve the housing crisis and that the deficit spending is almost certain to morph into a serious inflation.
The problem goes much, much deeper than that. Thanks to a state-run education system that has been steadily dumbed down to make the tenured teachers look good, a majority of the populace is now stunningly ignorant as to even the most basic principles of how economies and markets work.
I’m almost reluctant to share this next bit of audio with you, because I am not a big fan of talk radio personalities, and because the caller is such a soft target. But as it helps make the point, I will share it nonetheless. You have to listen to this entire exchange to believe that anyone can be so ignorant of even the basics. Here’s the link.
The significance of mass misconceptions about the most fundamental of economic principles is that they allow the politicians, the Fed, the Treasury, and the large financial institutions to engage in all manner of sleight of hand to further their own agendas.
For example, politicians have been energetic in spouting misinformation about the causes of the current crisis, with thinly veiled fingers pointing in the direction of society’s money-makers. By doing so, they give themselves license to selectively raise taxes and layer on populist legislation that is seen to be for the “public good” – all the while attempting to avoid blame for their own considerable role in all of this.
But, stepping back from the one-sided babble, an individual with a correct understanding of the language of economics will know that creating class warfare, raising taxes, and adding regulation runs completely contrary to the requirements of a robust economy.
There is good news in all of this.
Namely that individuals with the wherewithal to invest some of their time in learning how things actually work in the real economy – a group that includes you, dear reader – are five steps ahead of the crowd.
Simply, the time you spend reading more informed views – views that might be termed contrarian to the Politibonics spoken by the nation’s leadership – should pay big dividends as the crisis continues. There will be days when you feel like the proverbial one-eyed person in the land of the blind – or even as awkward as I felt when trying to communicate with the store clerk – but you should take that as a sign that you are on the right track. The minute you start accepting the conventional wisdom as personified by the talking heads on MSNBC, you can be sure you are about to step off a cliff.
In the interest of promoting a wider understanding of what’s really going on in the world, I am going to share a video that many of you have forwarded to me.
It’s from something called the National Inflation Association, and it’s competently done. I have to admit that I wish whoever produced it had thought to include Casey Research, as we were well ahead of virtually all of the presenters in anticipating this crisis and preparing our readers for it, but that’s okay – we’re just happy to see the word getting out.
Here’s the video, titled Meltup.
Next up, our own Bud Conrad explains the LIBOR-OIS spread, for those of you unfamiliar with this particularly useful indicator.