U.S. NOW ADDING 5.5 BILLION DOLLARS A DAY NATIONAL DEPT...IN 1 FREAKING DAY...

Judy Shelton: The recovery starts with sound money


How Do You Answer the Question? Toby Connor


Fixing Europe May Be an 'All or Nothing' Affair


Gold soars to $1,700 in Greece

Thursday, May 27, 2010Text Size:
From Zero Hedge:... Coinupdate.com reports that prices at which the Greek Central Bank is selling one ounce gold equivalents are as high as $1,700 (40% over spot), and prices on the black markets are even higher.The punchline, as Athens slowly returns to a forced gold standard: " A popular spot for street vendors to sell their coins is near the Athens Stock Exchange. There the traders wait for citizens to bring payments received from unloading their paper assets like stocks and bonds."That's good...Read full article...


Business-Economics
25 Questions To Ask Anyone Who Is Delusional Enough To Believe That This Economic Recovery Is Real
Published on 05-25-2010
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By Michael Snyder - BLN Contributing Writer
If you listen to the mainstream media long enough, you just might be tempted to believe that the United States has emerged from the recession and is now in the middle of a full-fledged economic recovery. In fact, according to Obama administration officials, the great American economic machine has roared back to life, stronger and more vibrant than ever before. But is that really the case? Of course not. You would have to be delusional to believe that. What did happen was that all of the stimulus packages and government spending and new debt that Obama and the U.S. Congress pumped into the economy bought us a little bit of time. But they have also made our long-term economic problems far worse. The reality is that the U.S. cannot keep supporting an economy on an ocean of red ink forever. At some point the charade is going to come crashing down.
And GDP is not a really good measure of the economic health of a nation. For example, if you would have looked at the growth of GDP in the Weimar republic in the early 1930s, you may have been tempted to think that the German economy was really thriving. German citizens were spending increasingly massive amounts of money. But of course that money was becoming increasingly worthless at the same time as hyperinflation spiralled out of control.
Well, today the purchasing power of our dollar is rapidly eroding as the price of food and other necessities continues to increase. So just because Americans are spending a little bit more money than before really doesn’t mean much of anything. As you will see below, there are a whole bunch of other signs that the U.S. economy is in very, very serious trouble.
Any “recovery” that the U.S. economy is experiencing is illusory and will be quite temporary. The entire financial system of the United States is falling apart, and the powers that be can try to patch it up and prop it up for a while, but in the end this thing is going to come crashing down.
But as obvious as that may seem to most of us, there are still quite a few people out there that are absolutely convinced that the U.S. economy will fully recover and will soon be stronger than ever.
So the following are 25 questions to ask anyone who is delusional enough to believe that this economic recovery is real….
#1) In what universe is an economy with 39.68 million Americans on food stamps considered to be a healthy, recovering economy? In fact, the U.S. Department of Agriculture forecasts that enrollment in the food stamp program will exceed 43 million Americans in 2011. Is a rapidly increasing number of Americans on food stamps a good sign or a bad sign for the economy?
#2) According to RealtyTrac, foreclosure filings were reported on 367,056 properties in the month of March. This was an increase of almost 19 percent from February, and it was the highest monthly total since RealtyTrac began issuing its report back in January 2005. So can you please explain again how the U.S. real estate market is getting better?
#3) The Mortgage Bankers Association just announced that more than 10 percent of U.S. homeowners with a mortgage had missed at least one payment in the January-March period. That was a record high and up from 9.1 percent a year ago. Do you think that is an indication that the U.S. housing market is recovering?
#4) How can the U.S. real estate market be considered healthy when, for the first time in modern history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together?
#5) With the U.S. Congress planning to quadruple oil taxes, what do you think that is going to do to the price of gasoline in the United States and how do you think that will affect the U.S. economy?
#6) Do you think that it is a good sign that Arnold Schwarzenegger, the governor of the state of California, says that “terrible cuts” are urgently needed in order to avoid a complete financial disaster in his state?
#7) But it just isn’t California that is in trouble. Dozens of U.S. states are in such bad financial shape that they are getting ready for their biggest budget cuts in decades. What do you think all of those budget cuts will do to the economy?
#8) In March, the U.S. trade deficit widened to its highest level since December 2008. Month after month after month we buy much more from the rest of the world than they buy from us. Wealth is draining out of the United States at an unprecedented rate. So is the fact that the gigantic U.S. trade deficit is actually getting bigger a good sign or a bad sign for the U.S. economy?
#9) Considering the fact that the U.S. government is projected to have a 1.6 trillion dollar deficit in 2010, and considering the fact that if you went out and spent one dollar every single second it would take you more than 31,000 years to spend a trillion dollars, how can anyone in their right mind claim that the U.S. economy is getting healthier when we are getting into so much debt?
#10) The U.S. Treasury Department recently announced that the U.S. government suffered a wider-than-expected budget deficit of 82.69 billion dollars in April. So is the fact that the red ink of the U.S. government is actually worse than projected a good sign or a bad sign?
#11) According to one new report, the U.S. national debt will reach 100 percent of GDP by the year 2015. So is that a sign of economic recovery or of economic disaster?
#12) Monstrous amounts of oil continue to gush freely into the Gulf of Mexico, and analysts are already projecting that the seafood and tourism industries along the Gulf coast will be devastated for decades by this unprecedented environmental disaster. In light of those facts, how in the world can anyone project that the U.S. economy will soon be stronger than ever?
#13) The FDIC’s list of problem banks recently hit a 17-year high. Do you think that an increasing number of small banks failing is a good sign or a bad sign for the U.S. economy?
#14) The FDIC is backing 8,000 banks that have a total of $13 trillion in assets with a deposit insurance fund that is basically flat broke. So what do you think will happen if a significant number of small banks do start failing?
#15) Existing home sales in the United States jumped 7.6 percent in April. That is the good news. The bad news is that this increase only happened because the deadline to take advantage of the temporary home buyer tax credit (government bribe) was looming. So now that there is no more tax credit for home buyers, what will that do to home sales?
#16) Both Fannie Mae and Freddie Mac recently told the U.S. government that they are going to need even more bailout money. So what does it say about the U.S. economy when the two “pillars” of the U.S. mortgage industry are government-backed financial black holes that the U.S. government has to relentlessly pour money into?
#17) 43 percent of Americans have less than $10,000 saved for retirement. Tens of millions of Americans find themselves just one lawsuit, one really bad traffic accident or one very serious illness away from financial ruin. With so many Americans living on the edge, how can you say that the economy is healthy?
#18) The mayor of Detroit says that the real unemployment rate in his city is somewhere around 50 percent. So can the U.S. really be experiencing an economic recovery when so many are still unemployed in one of America’s biggest cities?
#19) Gallup’s measure of underemployment hit 20.0% on March 15th. That was up from 19.7% two weeks earlier and 19.5% at the start of the year. Do you think that is a good trend or a bad trend?
#20) One new poll shows that 76 percent of Americans believe that the U.S. economy is still in a recession. So are the vast majority of Americans just stupid or could we still actually be in a recession?
#21) The bottom 40 percent of those living in the United States now collectively own less than 1 percent of the nation’s wealth. So is Barack Obama’s mantra that “what is good for Wall Street is good for Main Street” actually true?
#22) Richard Russell, the famous author of the Dow Theory Letters, says that Americans should sell anything they can sell in order to get liquid because of the economic trouble that is coming. Do you think that Richard Russell is delusional or could he possibly have a point?
#23) Defaults on apartment building mortgages held by U.S. banks climbed to a record 4.6 percent in the first quarter of 2010. In fact, that was almost twice the level of a year earlier. Does that look like a good trend to you?
#24) In March, the price of fresh and dried vegetables in the United States soared 49.3% - the most in 16 years. Is it a sign of a healthy economy when food prices are increasing so dramatically?
#25) 1.41 million Americans filed for personal bankruptcy in 2009 – a 32 percent increase over 2008. Not only that, more Americans filed for bankruptcy in March 2010 than during any month since U.S. bankruptcy law was tightened in October 2005. So shouldn’t we at least wait until the number of Americans filing for bankruptcy is not setting new all-time records before we even dare whisper the words “economic ".



Breaking from Moneynews.com
Report: US Money Supply Plunging at 1930s Rate
The United States’ M3 money supply reportedly is plunging at an accelerating pace similar to that in 1929 to 1933, despite near-zero interest rates.
The M3 data — which include a broad range of bank accounts and are tracked by British and European experts for danger signs about the U.S. economy — began shrinking a year ago, London’s Daily Telegraph reported. That race has since picked up speed.
The stock of money fell from $14.2 trillion to $13.9 trillion in the three months to April, amounting to an annual rate of contraction of 9.6 percent, the report said. The assets of institutional money market funds fell at a 37 percent rate, the sharpest drop ever.
"It’s frightening," Professor Tim Congdon, from International Monetary Research, told the newspaper.
"The plunge in M3 has no precedent since the Great Depression. The dominant reason for this is that regulators across the world are pressing banks to raise capital asset ratios and to shrink their risk assets. This is why the US is not recovering properly," he said.
White House officials plan even more spending, despite warnings from the IMF that the gross public debt of the United States will reach 97 percent of GDP next year and 110 percent by 2015.
Larry Summers, President Barack Obama’s top economic adviser, has asked Congress to "grit its teeth" and approve a new financial boost of $200 billion to keep growth on track.
"We are nearly 8 million jobs short of normal employment. For millions of Americans the economic emergency grinds on," he said.
Meanwhile, a top Federal Reserve official said the central bank will watch the U.S. economy's progress through autumn and into 2011 as it decides how long it will hold interest rates at ultra-low levels, Reuters reported.
In an interview earlier this week with Reuters Insider television in London, St. Louis Federal Reserve Bank President James Bullard said the U.S. economic recovery was on track and that the Fed was keeping a close eye on risks stemming from the euro debt crisis.
He said the Fed could not make any promises on when it would change its monetary policy stance.
"The economy is doing fairly well so far," Bullard said.
"We have some risk, we have the situation in Europe we're watching very closely, but we'll see how things proceed through the fall and into 2011."
The Fed has chained rates to near zero since December 2008 to help steer the world's biggest economy through the financial crisis and resulting recession.
© Moneynews. All rights reserved.


The #1 Reason to Own Gold and Silver
By Greg McCoach Thursday, May 27th, 2010
If you want to get a glimpse into the future of things to come in the United States, you need look no further than recent events in Greece.
The protests and riots that have been underway because of the unpopular cuts in pensions, wages, and benefits (along with increased taxes) are a precursor of things to come for the world at large.
The reason this is happening is that Greece's government spent and borrowed themselves into oblivion, and must now submit to harsh terms in order to receive a bailout. They have no choice in the matter.
They either rein in their spending and raise taxes or suffer the horrible consequences of not getting a bailout, which essentially would mean the death of Greece as a country.
The difficult and harsh realities now faced by the people of Greece should be a wake-up call for all citizens of the world.
Running deficits and spending yourself beyond your means does matter and eventually catches up with you. When that moment comes, it will not be pleasant for the people of that state or country.
And the Greeks, like most governments around the world, have been overspending for decades. The ridiculous, failed government-owned businesses, benefit programs, and subsidies of every kind have made Greece a laughing stock and the classic example of "out of control" government.
But until the unsustainable situation caused a dire problem, most people (voters) went along with the status quo. So long as they were getting theirs, who cares?
This is the essence of what ails America and every other country that thinks it can create money out of thin air — whenever it wants or needs to, to get whatever it so desires.
This line of thinking — that government has a limitless checkbook and can take care of its citizens from cradle to grave — is complete and utter stupidity. It always has consequences and now those consequences are going to be felt around the world. The painful process of fiat currency unraveling and bubble popping is picking up momentum.
The rioting, protests, strikes, and violence we are seeing in Greece right now will also happen in the United States and around the world as one fiat currency domino after another topples.
Mark my words: Civil unrest is coming to many countries (including the United States), and it is coming sooner than most people understand.
The 1,000-point drop in the Dow earlier this month was blamed at first on the mess in Greece as the complexity of a financial solution became more apparent.
In reality, the reason for the drop in the Dow is multi-faceted; in my opinion, it was the result of its being grossly overvalued.
When I heard the mainstream media eventually try to tell us that the massive drop in the Dow was caused by a computer mistake, I actually burst out laughing... The powers that be certainly don’t want mainstream Americans to understand the truth of just how weak the whole system is, and that the Dow can sell off 1,000 points in less than a few hours...
For now, however, the next trillion dollar bailout is underway as I promised you would happen again as we tried to bailout the first wave (TARP). We will continue to hear about bailouts of all kinds.
The latest one is a three-year plan with a $1 trillion price tag, combining efforts from the European Commission, Eurozone countries, and the International Monetary Fund to support the euro and poorer EU countries at risk for default like Greece, Spain, Ireland, and Portugal.
These bailouts are a joke and give those in power even greater authority to steal from the masses and bring the world to the economic precipice.
The de-coupling that I have been talking about for almost a year and a half is now underway. The first major signal occurred as the Dow dropped 1,000 points and gold jumped higher on the news.
In other words, when we see that gold is going higher as world markets continue to sell off, that is the signal that safe haven buying is about to become a main stream event.
I would imagine that gold is getting ready to run to the next new high, which I anticipate will take us to the $1,350 level or possibly higher. The story in silver, however, is getting even more interesting...
To summarize, now that the de-coupling is underway, I believe we are going to see major moves in the precious metals and mining stocks as the masses run for the exits on their failing government currencies and grossly overvalued general stock and bond market portfolios.
As this movement grows in maturity, the stampede into the precious metals is going to be one for the record books.
Hold on tight to your precious metals investments as the currency and general stock markets whipsaw back and forth before their ultimate collapse.
Gold and silver is the place you ought to be!
For investors looking for leverage, Van Eck offers the Gold Miners ETF (NYSE: GDX), based on an index that provides exposure to publicly-traded companies engaged in mining for gold. Another option is the Junior Gold Miners ETF (NYSE: GDXJ), also from Van Eck. This fund focuses on equities of small and mid cap gold companies.
For investors looking to leverage the price of gold even further, I invite you to check out the profits you could be making right now by joining Luke Burgess' Hard Money Millionaire advisory service.
In 2009, the Hard Money Millionaire portfolio delivered 22 winning investment recommendations out of 23 ventures — a 95.7% success rate. At its best, his portfolio returned members seven (7) winning investments that each returned a +100% gain.
In fact, the gains from his Hard Money Millionaire portfolio are on par with $100 million hedge funds!
For the year, the Hard Money Millionaire portfolio returned an average of 21.3%. The Barclay Hedge Fund Index, which uses data from 1,658 hedge funds around the world, calculates that hedge funds returned an average of 24.1% for 2009 — only slightly higher than his average return.
The difference between the hedge fund gains and Hard Money Millionaire? You don't need a million dollars to join.
You can even check out his latest recommendation right now.
Good Investing,
Greg McCoach


French Strike on Plans to Raise Retirement Age- USA Today


Mining Equipment Sold Out until 2011- CNN Money



Gold ETF Edges Up on Safe Haven Appeal- Financial Post


US Spending on Food Stamps at All-Time High- Fox News


Health Insurance Hikes Hitting CA Small Businesses- LA Times


More Cities on the Brink of Bankruptcy- CNBC