Tuesday, June 29, 2010

G20 Agrees house of cards will collapse...Notice the wording..."WHEN BANKS FAIL"

The G20 communique agreed that all countries should ensure taxpayers are not stuck with the bill when banks fail - but left it up to individual countries to decide how they want to do that. Read more: http://www.dailymail.co.uk/news/article-1290152/G20-SUMMIT-Banks-told-hoard-130bn-case-crisis.html#ixzz0sIq0Lf00

Markets Make A Definitive Statement Posted: Jun 29 2010 By: Jim Sinclair Post Edited: June 29, 2010 at 8:02 pm
Filed under: General Editorial
Dear CIGAs,
Equity markets are sharply lower, the Euro is sharply lower, commodities are under significant pressure. Gold opens lower and recovers $16 from the low to be up on the day.
1. The type on inflation being discounted by Gold requires business activity to be putrid.

2. This type of inflation is hyperinflation, which is a currency event, not an economic demand phenomenon.

3. Rather than a singular currency loss of confidence igniting hyperinflation, it will be all Western currencies moving against each other with intolerable to business volatility.

4. All Western governments will practice QE to infinity, as we return to credit market problems. The statement of the G20 and Prince Charles cutting down on caterers is all smoke and MOPE.

5. Gold is NOT a commodity.

6. Gold is a currency

7. Gold is the currency of choice.

8. Gold is going to becoming the reserve asset of choice by central banks

9. Ownership of gold means you are your own central bank.

The arguments between inflation and deflation revealed itself today to be purely semantical.
Gold is headed in this move to $1650 with its normal drama.

Jim Sinclair’s Commentary
If you feel comfortable being in the US dollar you would feel comfortable in Chernobyl.

The virtual reserve currency to come cannot survive as a huge index of world fiat paper unless it is tied to gold in the manner I have reviewed with you many times.

The virtual world currency reserve will be tied to gold, not as a convertible, but in a ratio of value to the level international liquidity after the storm.

UN calls for scraping dollar Wed, 30 Jun 2010 00:40:31 GMT

A UN report released on Tuesday calls for abandoning the US dollar as the main global reserve currency to achieve greater stability in the world financial system.
"The dollar has proved not to be a stable store of value, which is a requisite for a stable reserve currency," said the World Economic and Social Survey 2010.
The use of the dollar for international trade came under increasing scrutiny when the US economy fell into recession.
The report said a new global reserve system should be created, which "must not be based on a single currency or even multiple national currencies." Instead, the report advocates using assistance from the International Monetary Fund to create a standardized international system for liquidity transfer.
The report added that developing countries have been hit hard by the US dollar’s loss of value in recent years.
"Motivated in part by needs for self-insurance against volatility in commodity markets and capital flows, many developing countries accumulated vast amounts of such (US dollar) reserves during the 2000s," it said.

Derivative Market: Alive and Kicking Despite Reforms

Meltzer: Obamanomics Has Failed- Wall Street Journal

Soon this will happen here
New UK ATMs to Restrict Money Supply

46 US States Facing Greek-Style Crisis

Severe Economic Downturn Indicated

Stocks Skid on Renewed Fears of Global Slowdown

15 Facts About China That Will Blow Your Mind.

Utah gun permit business booming - in other states
Porter Stansberry: U.S. is headed for one of the worst inflations in history"Could easily be worse than Weimar Germany..."

Drop dollar as reserve currency, U.N. report says
Submitted by cpowell on Tue, 2010-06-29 20:19. Section:
By Louis CharbonneauReutersTuesday, June 29, 2010

A new United Nations report released on Tuesday calls for abandoning the U.S. dollar as the main global reserve currency, saying it has been unable to safeguard value.
"The dollar has proved not to be a stable store of value, which is a requisite for a stable reserve currency," the U.N. World Economic and Social Survey 2010 said.
The report says that developing countries have been hit by the loss of value of the U.S. dollar in recent years.
"Motivated in part by needs for self-insurance against volatility in commodity markets and capital flows, many developing countries accumulated vast amounts of such (U.S. dollar) reserves during the 2000s," the report said.
The report supports replacing the dollar with the International Monetary Fund's special drawing rights (SDRs), an international reserve asset that is used as a unit of payment on IMF loans and is made up of a basket of currencies.
"A new global reserve system could be created, one that no longer relies on the United States dollar as the single major reserve currency," the U.N. report said.
It said a new reserve system "must not be based on a single currency or even multiple national currencies but, instead, should permit the emission of international liquidity (such as SDRs) to create a more stable global financial system."
"Such emissions of international liquidity could also underpin the financing of investment in long-term sustainable development," it said.
Nobel Prize winner Joseph Stiglitz, who previously chaired a U.N. expert commission that considered ways of overhauling the global financial system, is among the economists who have advocated the creation of a new reserve currency system, possibly based on SDRs.

Commodity position limits included in financial regulation bill

Home Prices Could Drop 50% as Recession Resumes- Forbes

O'Neill: It's a 'Perfect Storm' for Gold

World's Central Bank Calls for Austerity- Reuters

State Workers Begin Accepting Benefit Cuts- Wall Street Journal

Protesters Clash with Greek Police over Reforms- USA Today

Gold May Move Higher on Fears of Double-Dip- UK Guardian

Hussman: US Double-Dip Recession Is Nigh- Financial Post

Ambrose Evans-Pritchard smashes Fed's incompetent elitism

Monday, June 28, 2010

RBS tells clients to prepare for 'monster' money-printing by the Federal Reserve. Here is a quote: "We cannot stress enough how strongly we believe that a cliff-edge may be around the corner, for the global banking system (particularly in Europe) and for the global economy. Think the unthinkable."

Debt Crisis Cannot Be Manipulated Away Posted: Jun 28 2010 By: Jim Sinclair Post Edited: June 28, 2010 at 4:25 pm
Filed under: General Editorial

Dear Friends,
If the market for gold had not done its runaway/runaway common to overleveraged long morons, it would have broken out of the neat cup and handle formation going on to $1650. It will definitely break out of that formation.
The short term bullies that manipulated today’s market cannot manipulate the reality of the debt crisis away.
Today was the do or die takedown in gold by the mega hedge fund traders using the gold banks as beards for maximum effect. It was that because of the cup and handle formation. I know because I used to do the same thing on the other side.
Back in the 70s when the Middle East was the major buyers of gold they used a certain German bank as their broker constantly. When I wanted to run a large short position into oblivion, I used the same bank as buyers that represented the Middle East.
Nobody wants to buy or sell, only manipulate price, when they bid ten times what the offering is or offers ten times what the bid is in an open outcry market.
You have witnessed a pure operation by the bear hedge fund, just the same ones that are short of the junior and intermediate gold shares.
What has been painted in the gold market is also being attempted in the gold sharers. In time the futility of this will be very evident.
Respectfully, Jim

Budget Crises to "Destroy Social Fabric" of US- Financial Times

The Next Crisis: Public Pension Funds- NY Times

Foreign Central Banks Going for the Gold

Biden: We Can't Recover all the Jobs Lost

Derivatives Blow for Wall Street Banks Under Historic US Reforms. Translation: The congresscritters don't understand derivatives, and the legislation will do little to prevent a massive derivatives implosion that is likely in this decade.

The Next Catastrophic Bubble to Break Will be Private Sector Debt.

Extend And Pretend: A Matter of National Security

Scrambling for Votes on Wall Street Reform

The Market Goes Under Full Anesthesia

Double Dip? Or Did The Great Recession Never End?

High Court’s Big Ruling For Gun Rights

IL Borrowing $900M as Credit-Default Cost Doubles- Bloomberg

Jim Sinclair’s Commentary
Illinois is going to seek major funds in the debt market. The price of credit default derivatives has doubled and Illinois continues to look awful.
CDS OTC derivatives are about to slam more than 40 states.

Jim Sinclair’s Commentary
Just in case you missed it, three more bank closures on Friday brought this year’s total failures to 86 so far.

Jim Sinclair’s Commentary
Don’t kid yourself for a moment, QE is going to infinity in the USA and elsewhere.
The G20 is only hot air to hold off CDS OTC weapons of mass financial destruction.

RBS tells clients to prepare for "monster" money printing by the Federal Reserve As recovery starts to stall in the US and Europe with echoes of mid-1931, bond experts are once again dusting off a speech by Ben Bernanke given eight years ago as a freshman governor at the Federal Reserve. By Ambrose Evans-Pritchard Published: 5:11PM BST 27 Jun 2010
Entitled "Deflation: Making Sure It Doesn’t Happen Here", it is a warfare manual for defeating economic slumps by use of extreme monetary stimulus once interest rates have dropped to zero, and implicitly once governments have spent themselves to near bankruptcy.
The speech is best known for its irreverent one-liner: "The US government has a technology, called a printing press, that allows it to produce as many US dollars as it wishes at essentially no cost."
Bernanke began putting the script into action after the credit system seized up in 2008, purchasing $1.75 trillion of Treasuries, mortgage securities, and agency bonds to shore up the US credit system. He stopped far short of the $5 trillion balance sheet quietly pencilled in by the Fed Board as the upper limit for quantitative easing (QE).
Investors basking in Wall Street’s V-shaped rally had assumed that this bizarre episode was over. So did the Fed, which has been shutting liquidity spigots one by one. But the latest batch of data is disturbing.
The ECRI leading indicator produced by the Economic Cycle Research Institute plummeted yet again last week to -6.9, pointing to contraction in the US by the end of the year. It is dropping faster that at any time in the post-War era.

Saturday, June 26, 2010

The Many Faces of Gold

Geithner and ohbama are on their knees either begging or doing something else...trying to get other countries to throw more money in the black hole...they gave him the middle finger....so he will print money till we run out of trees...His ONLY option...Get ready for hyperinflation while you still have time...
Geithner Stresses Need to Balance Austerity With Growth
World leaders must focus on bolstering growth in a global economy still scarred by crisis, Treasury Secretary Timothy Geithner said on Saturday as the heads of the Group of 20 nations gathered in Canada.

20 Must-See Charts on America's Disastrous Level of Government Spending

Geithner: US Can "No Longer Drive Global Growth"

New uses for silver to grow demand in next 10 years.

Gold on Longest Winning Streak Since 1920.

There are more and larger bread lines then during the Depression...you just can't see them...Why? Because over 40 MILLION Americans are on food stamps...Hidden from your and the world's view...

More than 40 million now use food stamps

BANK FAILURE FRIDAY...with bank closures in New Mexico, Georgia, and Florida.

Remember the F.D.I.C. is BANKRUPT...we are just printing money to paper over the problem.

Federal Reserve Cautions on US Economic Growth

Bernanke Needs Fresh Monetary Blitz as US Recovery Falters

Senate Republicans Defeat Jobless Aid Measure Over Deficit Fears

Silver Without a Cloud by Richard Daughty, aka The Mogambo Guru

California to Offer Program to Trim Underwater Mortgages

Fannie Mae Gets Tough with Homeowners Who Walk Away

Economy Faces Tough Road Ahead with Slower Growth
Do your family a favor and watch these video's...

Brown Brothers Warns on Deterioration in State and Local Government Deficits, Cautions of Comparable European Collapse

Pathway to the Gold-Backed Euro
Jim Willie CB

46 US States Facing Greek-Style Deficits- Bloomberg

There was a news story out today published in the Telegraph in England describing a very panicked Ben Bernanke. You can read the story here.
The reporter states that Ben Bernanke has been "waging an epochal battle behind the scenes" to overcome resistance to his plan to expand the Fed's balance sheet from its present $2.4 trillion to a jaw-dropping $5 trillion.
Bernanke knows we are heading into an economic depression, and is reaching for the panic button.
The problem is that his solution to prevent a depression will not work.
You cannot print your way to prosperity.
Bernanke should study the economy of Zimbabwe during past 5 years if he thinks it is possible.
It isn't.
Expanding the Fed's balance sheet to $5 trillion by creating another $2.6 trillion out of thin air will only result in further currency debasement, and bring about an inflationary crisis.
Behind the scenes, both the economy and financial system are rapidly deteriorating.
This story is ample evidence of that fact, and there is nothing Bernanke can do to stop it.
Sincerely, Wealth Insider Alliance

Lawmakers Pass Biggest Wall St Overhaul since '30s- Financial Post

Regulation Won't Prevent New Crisis: Former FDIC Chair

Leaders Differ on How to Nurture a Global Economy

These days the Government stastics are ALL LIES when they are released...then months later they revise them down where they should have been in the first place...

Government Lowers Growth Estimate for First Quarter

Make no mistake...war will arrive very soon...WWIII. War stimulates the economy and tends to keep whomever is in power,in power...Euro "Collapse" Could Drag Europe Into Conflict

Why Wall Street Should Love The 3% Solution in Reform Bill
The new limits on proprietary trading and hedge fund investments may actually benefit big banks more than harm them—especially in the hedge funds they market to clients.

30-Yr Mortgage Rates at Record Low; Sales Slump- BusinessWeek

In The News Today Posted: Jun 25 2010 By: Jim Sinclair Post Edited: June 25, 2010 at 12:09 pm
Filed under: In The News
Jim Sinclair’s Commentary
46 States and growing. There is more trouble in the United States than in the EU.
The Formula has overrun the States.

States of Crisis for 46 Governments Facing Greek-Style Deficits By Edward Robinson – Jun 25, 2010
Californians don’t see much evidence that the worst economic contraction since the Great Depression is coming to an end.
Unemployment was 12.4 percent in May, 2.7 percentage points higher than the national rate. Lawmakers gridlocked over how to close a $19 billion budget gap are weighing the termination of the main welfare program for 1.3 million poor families or borrowing more than $9 billion in the bond market. California, tied with Illinois for the lowest credit rating of any state, is diverting a rising portion of tax revenue to service debt, Bloomberg Markets magazine reports in its August issue.
Far from rebounding, the Golden State, with a $1.8 trillion economy that’s larger than Russia’s, is sinking deeper into its financial funk. And it’s not alone.
Even as the U.S. appears to be on the mend — gross domestic product has climbed three straight quarters — finances in Arizona, Illinois, New Jersey, New York and other states show few signs of improvement. Forty-six states face budget shortfalls that add up to $112 billion for the fiscal year ending next June, according to the Center on Budget and Policy Priorities, a Washington research institution. State spending is 12 percent of U.S. GDP.
“States are going to have to cut back spending and raise taxes the same way Greece and Spain are,” says Dean Baker, co- director of the Center for Economic and Policy Research in Washington. “That runs counter to stimulating the economy and will put a big damper on the recovery in the latter half of this year.”

Jim Sinclair’s Commentary
Look at this oxymoron.
There will be no extensions of unemployment benefits based on supposed austerity, but the Federal Government will fill the state’s shortfalls with Federal money.

No extension for unemployment benefits. A third attempt by the Senate to pass an extension to unemployment benefits failed to win the 60 votes needed for cloture, as lawmakers showed increasing concern about the country’s fiscal position. As a result, the bill will be shelved and 1.3M unemployed will lose their unemployment assistance by the end of the week. The move will also leave several states with large budget holes they had expected to fill with federal money.

Jim’s Mailbox Posted: Jun 25 2010 By: Jim Sinclair Post Edited: June 25, 2010 at 12:00 pm
Filed under: Jim's Mailbox
Gold, The Formula and Illusion of Recovery CIGA Eric

I know much of the media and many individuals have filed the structural deficit under "Who Care’s" and moved on. It is, nevertheless, very important to confidence in and fate of the U.S. dollar. Total revenues collects by the US government continue to lag devaluation in the US dollar. In other words, "real" or gold adjusted total revenues continue to collapse at an alarming rate.
Real or Gold Adjusted Federal Total Receipts 12-Month Moving Average (TR12MA) AND Federal Total Receipts 12-Month Moving Average Year-over-Year Change (TW12MA12LN):
While Jim’s formula illustrates an anemic bounce, gold’s unabated rise during its uptick is best described as the middle finger gesture to economic recovery illusion.
US Federal Budget (Surplus or Deficit As A % of GDP, 12 Month Moving Average) and Gold London P.M. Fixed:
Source: fms.treas.gov

an article about New York state's 12th consecutive weekly package of emergency spending bills "to keep the government operating."
This bill will raise the price of cigarettes to over $11 a pack in New York, as well as taxing the cigarettes sold by American Indian stores to people outside the tribe. The last time New York tried the latter was in the late 1990s, and it met with violent protests. They haven't tried it since, so you know that they're getting desperate!

Ambrose-Evans Pritchard: Gold reclaims its currency status as the global system unravels

Cash Crops: Buying Farmland for Income

And you need to watch this one...
Video: Victoria Jackson: "There's A Communist Living in the White House!!"

Friday, June 25, 2010



Read this article and actually learn something useful.
Architecture for a New World Financial System
Antal Fekete

T Minus 7 Days to a LIBOR-Induced Liquidity Crunch?

Taxes Coming Due for $1 Trillion in Commercial Real Estate

Eurozone Banks Step Up Reliance on ECB- Wall Street Journal

Swiss Banks Winning Investors from Euro Area- Bloomberg

Gold Rises on Fed's Cautious Outlook- SF Chronicle

Why Many Analysts See Gold Going as High as $10,000

There is no recovery...This is a currency crisis...google it...

Double Dip Fears Put Scare Back in Market

The US is Pushing Its Debt Towards a $57 Trillion Hole

Yishai sent us this (by way of Glenn at Instapundit): Don’t Fear Inflation, if It Comes. (Oh, really? I guess he's never visited Zimbabwe...)

U.S. May Follow Britain's Lead and Pass Bank Tax. Oh, and the Brits are also discussing bumping the capital gains tax back up to 50%

CA, FL, Other States to Get More Housing Aid

Fed to Keep Rates Low to Support Weak Recovery

Harrisburg, PA, Other Cities Overwhelmed by Economic Downturn and Debt

The Best Stimulus? Spend Less, Borrow Less- CNN Money

How's that recovery workin out for you?

New-Home Sales Plummet Nearly 33% in May- LA Times

Jim Sinclair’s Commentary
The G20 script caste against present circumstances.

1. EC members terrified by the power of OTC derivatives to destroy national bond markets are running scared. The strategy is twofold. Intervention at $1.19 to $1.20 in the euro and massive PR concerning strong currency initiatives weakened the dollar from its highs and took the euro so far into its $1.24-$1.25 key resistance.

2. Bernanke as a student of the Great Depression organizes a strong argument for continued coordinated monetary expansion with the US Treasury.

3. Monetarism fails miserably when applied in an open system. That is its major weakness. Bernanke’s thesis demands the entire Western World be on the same page of Monetarism for without it new lows in the history of this period will be established. A return to locked credit markets is a reasonable assumption

4. Media seems to have slowed down on its revelations of EU weak states.

5. There seems to be a slight pickup in media discussion of the dire condition of US states heading towards bankruptcy.

Keep in mind that in this new global economy a problem anywhere is a problem everywhere. As any currency in the Western World comes under attack, Gold has become the asset of choice.
Be ready for more violence in the USD/EU equation. Violence regardless of direction will be gold positive. This move is to $1650 and beyond.

Jim Sinclair’s Commentary
An event to keep in mind: More than a million people are expected to run out of benefits this month, according to the National Employment Law Project.

Jim Sinclair’s Commentary
The is a clear and present danger when a competitor holds your future in their hands.
The story that China would suffer as much is total crap when you see them cultivating Asian trading partners, internal consumptive power and cornering world hard assets.

China’s holding of US Treasuries is a strategic move and a weapon of mass financial destruction if it should be used in a manner other than as an investment.

U.S. intelligence community debates China’s bond holdings Wed Jun 23, 2010 3:19pm EDT By Emily Flitter
NEW YORK, June 23 (Reuters) – U.S. intelligence officials and top academics last week debated the risk China could wield its massive U.S. debt holdings as a weapon aimed at influencing U.S. foreign policy, according to a person who attended the meeting.
At a National Intelligence Council meeting last week, held at a Washington, D.C. hotel, members of U.S. intelligence agencies and China watchers discussed potential outcomes if China chose to sell its $900 billion of U.S. Treasury bond holdings, pushing up interest rates and making life much tougher for U.S. businesses and consumers.
While considered a remote possibility, China’s tremendous economic stranglehold over the United States remains much-debated as the world’s third largest economy grows in leaps and bounds and the number one economy struggles to break free from a deep recession.
The meeting took place as the United States prepares to issue a report that could label China a currency manipulator. U.S. lawmakers are also arguing over a bill that would penalize China for any protectionist policies.
"The best offense is often a good defense and you must be prepared. This is something that allows the U.S. to consider what policy alternatives they might have when facing threats from the outside," said Paul Markowski, president of the Global Strategies-Analysis Group in New York.

Jim Sinclair’s Commentary

Back towards crisis levels.

How about to worse than recent crisis levels in this Ski Jump Virtual Recovery.

Deutsche Bank: U.S. Financial Conditions Just Collapsed Back To Crisis Levels Vincent Fernando, CFA Jun. 24, 2010, 5:36 AM
Deutsche Bank has a new and improved index of U.S. financial conditions, and this index just slumped back towards the lows of our recent crisis.
Deutsche Bank’s Peter Hooper:
Financial conditions appear to have worsened substantially in recent quarters based on our update of the broad index of US financial variables presented earlier this year at the US Monetary Policy Forum. In the wake of recent developments in Europe, increased stress in financial markets has pushed that index halfway back to its immediate post- Lehman crisis lows.

The index is built from an array of financial indicators such as U.S. treasury yields, the volatility index (VIX), the stock market, Broker-Dealer leverage, among others. It’s a bit of a black box, but it’s calculation is giving a similar reading to what we saw during the worst of the financial crisis.

Here's more of that hopey changey stuff you can believe in...

Bank of America Boosts Staff Handling Troubled Loans By David Mildenberg – Jun 23, 2010

Bank of America Corp., the second- largest U.S. home lender, added 2,000 employees since April to work with borrowers having trouble paying their mortgages, a senior executive said.
The lender now has more than 18,000 workers in “default management,” a 60 percent increase since January 2009, Barbara Desoer, president of Bank of America’s home-loan and insurance unit, said in testimony prepared for a congressional hearing on U.S. housing policy tomorrow. Those workers handle 100,000 calls a day, she said. Wells Fargo & Co., the largest U.S. home lender, Bank of America and other companies have hired thousands of employees or shifted staff from other departments to work with borrowers who have lost jobs or experienced declining incomes. Banks repossessed a record 257,944 homes in the first quarter, 35 percent more than a year earlier, according to Irvine, California-based RealtyTrac Inc. More than a fifth of U.S. mortgage holders owed more than their homes were worth, Seattle- based real estate data provider Zillow.com reported last month.
“Given the depth of the nation’s recessionary impacts on homeowners, a considerable number of customers will transition from homeownership over the next two years,” Desoer said in the testimony. “We must compassionately and responsibly help those customers who have exhausted all their options and can no longer afford to stay in their homes.”
Handling More Calls
Bank of America, based in Charlotte, North Carolina, handles almost 14 million home loans, or about one of every five U.S. mortgages, more than any other U.S. servicer, Desoer said. Payments on 1.4 million loans are more than 60 days late, she said. Investors or government-sponsored entities such as Freddie Mac and Fannie Mae own most of those loans and pay servicers fees to handle billing and collection.


The Streets Shall Burn

Legendary investor Jim Rogers says that silver is an attractive commodity while gold remains at an all-time high.

If after reading this... you don't run to the store with a truck...then you deserve what you get.
AKA You reap what you sow...

Reader Jamie D. mentioned that the government's own documents show that the FSA program's food warehouses are effectively empty. Jamie notes: "Government still hasn’t begun to replenish actual reserves of food. This is mandated, funded, and empty. If the gulf disaster results in toxic rains that impact crops, the government will have no reserves of wheat, corn, soy, et cetera."

Chavez pushes Venezuela into food war.

Thursday, June 24, 2010

"We should do well to remember that, since time immemorial, gold has successfully acted as the ultimate extinguisher of debt — until it was forcibly removed from the international monetary system in 1971. Since 1971 governments have pretended that paying debt in U.S. dollars extinguished it, too. But in fact it did not. Debt was merely transferred from the debtor to the U.S. government and kept accumulating. Debt accumulation has a natural limit. This limit has now been reached." - Dr. Antal Fekete, What You Always Wanted to Know About Gold

The "RUN TO GOLD" has started...
Wall Street Journal patronizes trend toward taking possession of gold

As I have been telling you...they will print money till we run out of trees...
Ambrose Evans-Pritchard: Bernanke needs fresh money blitz as U.S. recovery falters

We are to the point of...print money or collapse...
Europe Spurns Obama's Plea for More Spending- CNN Money

The US Dollar Falls By Fall

Rise of the New Gold Rush

Niall Ferguson: Two year time horizon for US fiscal crisis

Bob Chapman: Fiat Money and Schemes Collapsing

Financial Overhaul 101: Protecting US Consumers

Battered Eurozone Vulnerable to Crisis

Gold's Good Times

Andrew H. spotted this piece over at Jesse’s CafĂ© AmĂ©ricain: Silver leaving the COMEX. Andrew asks: "[I]s there a reason why some of these well-heeled investors suddenly want their silver, and are either going in person to get it or arranging for armored car delivery? It makes one wonder what might be coming our way in the coming weeks."

The Associated Press: Canada's economy is suddenly the envy of the world

NIA Releases 2010 U.S. Inflation Report

Stocks Fall After New Housing Sales Drop 33%

Cost of Seizing Fannie and Freddie (financed properties) Surging

Oil Prices Slide As Stockpiles Build

Central Banks See Growing Reserve Role for Gold- Financial Times

I told you every country and every state will be bailed out...Where does the money come from? the printing press...and printing all that money will cause hyperinflation...period.

Feds Will Send More Mortgage Aid to Ailing States- USA Today

Bond Defaults Stalk Michigan as Home Prices Crash- Bloomberg

Home Sales Fall as End of Tax Credit Looms- Bloomberg


Middle-Class Tax Increase Is Broached- Wall Street Journal

Tax & Axe - Britain Unveils Emergency Budget- NY Times

BP Disaster Costs State Pensions $1.4B in Value- Bloomberg

Eurozone Banks Step Up Reliance on ECB- Wall Street Journal

Wednesday, June 23, 2010

"When people lose everything, they have nothing left to lose. And they lose it." - Gerald Celente

Ron Paul Questions Alan Greenspan
This video, from February 2000, has Congressman Ron Paul questioning Alan Greenspan, the then Chairman of the Federal Reserve, on the issue of management of the money supply. In this discussion Alan Greenspan admits that the Federal Reserve has not been able to come up with a good definition of money. He also admits that you cannot manage something that you cannot define. Length: 7:24

Merrill Lynch: The 3 big reasons gold and silver will soar

Tuesday, June 22, 2010Text Size:
From Mineweb:Merrill Lynch metals analysts maintain gold will hit a US$1,500 per ounce target by the end of next year as investor demand pushes gold prices higher.In research published Monday, analysts Michael Widmer, Francisco Blanch, and Alex Tonks are predicting average gold price forecasts of US$1,200/oz this year, $1,350/oz in 2011, and $1,400/oz in 2012, up from $1110/oz, $1179/oz and $1109/oz. respectively."We also believe that silver has further upside and see prices averaging..."Read full article...

Is U.S. Now on Slippery Slope to Tyranny?

Three Reasons You Should Buy Silver Right Now

Fresh Economic Worries Trigger Fresh Rush into Gold

Finding Gold in the Mainstream

Spain Could Test the Euro to its Limits

The Euro's Inevitable Failure Will Be Horrendous for All of Us

Global Systemic Crisis/Second Half of 2010: The Global System's Four Single Points of Failure

California on 'Verge of System Failure'.

Financial Reform Is a Disaster For Banks, Consumers: Bove. Did you notice how the key topic of derivatives trading wasn't even mentioned per se in this article?

Don Coxe Dissects Gold
Tyler Durden
What do you do if you can no longer believe in real estate, bank deposits, the dollar, the yen or the euro? What can you believe in? Gold. So old it’s new again, the yellow metal can’t be synthesized and acts as a store of value for future generations. Until recently, the case for gold was almost always presented as a hedge against inflation. That case remains valid, because if the US and European economies revive, then the pressure on the Fed and ECB to raise rates will become intense, even though unemployment will still be at historically high levels and politicians will be screaming that any rate increases will punish the poor to reward the rich. If the major central banks do not raise rates, investors worldwide will begin to bet heavily on a return of inflation. However, those monetary points of no return seem off in the distance, given modest US growth, and barely perceptible recoveries or renewed downturns within the Eurozone. Durden believes gold should be a significant component in most high net worth wealth preservation programs, and in most endowment and pension funds. For the first time since 1980, Germans and other Europeans with long memories are rushing to exchange euros for coins and small gold bars. Germans have watched as twice in the past century their currency was utterly destroyed. They believed Ludwig Erhard, who crafted the plan for West Germany's post-World War II economic recovery, when he said their nation could have a currency that was as good as gold. That belief was the underpinning of Germany’s rapid post-war reconstruction, but the faith is now dwindling and individual savers are protecting themselves.

Gold Reclaims its Currency Status as the Global System Unravels
Ambrose Evans-Pritchard
The ECB has revealed that its systemic risk indicator surged to an all-time high on May 7, during the Eurozone money-market meltdown. “The probability of a simultaneous default of two or more euro-area large and complex banking groups rose sharply,” it said. The banks in question were not identified. It remains unclear whether the multi-billion-euro rescue package will solve the problem, and this general worry may be behind gold’s rise to an all-time high of $1,258 an ounce. Several central banks have been buying gold, and Saudi Arabia has “restated” its reserves upwards from 143 million to 323 million tonnes. The general feeling is that the global currency system is unraveling, and that gold is reclaiming its role as the ultimate safe haven and benchmark currency. Inflation is not currently a problem, but may become one. The US seems doomed to suffer a double-dip recession, or else grind along for the next 12 months in a growth slump. For Europe, nothing short of a sustained global boom can lift the Eurozone out of the deflationary quicksand already swallowing up “Club Med.” Investors do not believe the EU can be relied upon to back its rescue rhetoric with hard money, and for good reason. Germany’s coalition, damaged by fury over the Greek bailout, could break apart at any moment. Far-right populist Geert Wilders is suddenly the second force in the Dutch parliament. Flemish separatists have just won the Belgian elections in Flanders. The likelihood that an ever-reduced group of German-bloc creditors facing disorder and budget cuts at home will keep footing the bill for an ever-widening group of Latin-bloc debtors in distress is diminishing daily. Fitch says it will take hundreds of billions of bond purchases by the ECB to stop the crisis escalating, but Germany is unlikely to sanction such full-blown quantitative easing. The struggle between Teutonic and Latin Europe will go on as the crisis festers.

Gold May Decline 50% Before the World Cup is Over
(And the World Cup May be Won by a Herd of Wild Burundi Elephants)
Eric Janszen
A recent Morgan Stanley analysis predicts that gold will plunge 70%. That is unlikely, writes Janszen, unless a credible proposal to pay down US government debt and reduce contingent liabilities is not only constructed, but also approved by dozens of special interest groups. The recent performance of the US political system at the relatively simple task of getting more health care to Americans at a lower cost is not encouraging. Janszen discusses gold as a currency hedge; historical amnesia; the central banking paradox; central bank (and IMF) gold reserves of over 100 tonnes each; why gold cannot be “just a commodity” if it is the only metal owned by central banks; China and Russia; who holds gold; and the countdown to a crisis. He loses no sleep worrying about gold prices plunging. Instead, he worries about the disastrous financial condition of US households and the US government, and the lack of political will to address them, which threaten the very foundation of the global money system. This is the reason for gold’s relentless rise. The problems are structural and endemic. Perhaps war is the only thing capable of unseating the special interests that perpetuate them. Gold prices do not float on a sea of liquidity; they float on a sea of dangerous fallacies: that asset bubbles don’t cause lasting damage to economies; that the US can continue to borrow to finance its fiscal deficit; the invulnerability of the dollar as a reserve currency. Janszen won’t bet against global central banks, and they are betting on gold. Soon, everyone will catch on.

Ten Important Real Estate Charts
Dr. Housing Bubble
The US housing market has been turned upside down thanks to unprecedented amounts of government intervention; there has been so much interference that even the seasonal pattern has changed. Spring and summer, usually the best selling times, will not likely enjoy that distinction in 2010 with the tax credit gone and the Fed done with buying mortgage-backed securities. It is unlikely that market conditions will improve any time soon, with unemployment in the top housing bubble states at peak levels. In California, unemployment remains at 12.6% and there are over 100,000 unemployed Californians that have now exhausted a stunning 99 weeks of unemployment benefits. All over the US, a similar story is playing out. Ten charts (housing starts, single family home sales, household debt service, Texas ratio at big banks, home price to median income, construction spending, pending home sales, mortgage applications, nationwide foreclosures and homeowner equity) paint a dismal picture of America’s housing market. From Alt-A and option ARMs to strategic defaults, unprecedented trends are showing up. In short, homeowners are tapped out. And with one-third of mortgage holders underwater, there is no home equity to borrow against, a phenomenon that supported the US economy for the entire bubble decade. While the tax credit did provide some momentum, that has petered out with little effect on the overall megatrend. Unfortunately, the US is a long way from any kind of recovery.

US Debt and the Greece Analogy
Alan Greenspan
Don’t be fooled by today’s low interest rates, writes Greenspan; the government could very quickly discover the limits of its borrowing capacity. “With huge deficits currently having no evident effect on either inflation or long-term interest rates, the budget constraints of the past are missing. It is little comfort that the dollar is still the least worst of the major fiat currencies. But the inexorable rise in the price of gold indicates a large number of investors are seeking a safe haven beyond fiat currencies. The United States, and most of the rest of the developed world, is in need of a tectonic shift in fiscal policy. Incremental change will not be adequate. In the past decade the US has been unable to cut any federal spending programs of significance. I believe the fears of budget contraction inducing a renewed decline of economic activity are misplaced. The current spending momentum is so pressing that it is highly unlikely that any politically feasible fiscal constraint will unleash new deflationary forces. I do not believe that our lawmakers or others are aware of the degree of impairment of our fiscal brakes. If we contained the amount of issuance of Treasury securities, pressures on private capital markets would be eased. Fortunately, the very severity of the pending crisis and growing analogies to Greece set the stage for a serious response. That response needs to recognize that the range of error of long-term US budget forecasts (especially of Medicare) is, in historic perspective, exceptionally wide. Our economy cannot afford a major mistake in underestimating the corrosive momentum of this fiscal crisis. Our policy focus must therefore err significantly on the side of restraint.”

Monday, June 21, 2010

The story that's GATA be told

Ted Butler: Mum's the word on silver

Jim Rickards: How the world likely will get back to gold

The soaring prices of gold and silver have been making lots of headlines,

A preview for other States? Nearly Bankrupt Illinois Forced to Pay Through The Nose to Borrow Money.

Gold's Rise is "a Sign of Anxiety," Not Inflation, ECRI's Achuthan Says. "This next decade is going to be much more volatile..."

Economy May Never Recover from Banking Crisis, Warns OBR

14 Reasons Why The US Government Will Never Have a Balanced Budget Again

Russia to Buy Canadian, Aussie Dollars for First Time Ever

Stocks Extend Gains as China Eases Currency Policy

More Borrowers Exit Obama Mortgage Help Plan

Gas Prices Going Back Up

Florida: Brazen home-invasion robberies stir Jupiter Farms residents to action

New York Post article: $7-a-gallon gas?

last week all of Intuit's online services went down for several days. This sent much of the company's critical accounting system, payroll and credit card business into cloudy limbo. Intuit's President sent out this apology. David comments: "This was reportedly caused by a power failure that cascaded. But no one is talking about where or how a massively redundant distributed, multi-locational system went down from a single outage."

CA License Plates Would Flash Ads in Revenue Bid- USA Today

Housing Subsidies Promote Unfairness, Bailouts- USA Today

Gold's Little Brother Silver Heads to $23- BusinessWeek

Loonie & Aussie Dollar Gaining Reserve Status- Financial Post

China Close to Catching US in Manufacturing- CNN Money

Jim Sinclair’s Commentary
If you wish to make one great step for mankind then apply this globally to OTC derivatives.

China executes securities trader over $9.52m fraud By Joe Fay

Chinese authorities have executed a securities trader found guilty of embezzlement to the tune of $9.52m.
However, the whereabouts of the siphoned-off cash is still unknown, Reuters reports – and presumably it will never now be recovered.
Yang Yanming received the death sentence back in 2005 for embezzlement while he was general manager of trading at China Great Wall Trust and Investment Corp, which later became Galaxy Securities.
"Preserve your moral integrity and don’t set too much store by business results," Yang told a newspaper just before his execution.
China takes a very harsh line on criminality, although this is the first execution carried out on an erstwhile member of the financial classes.
China carries out more executions every year than any other country, with either the gun or lethal injection used.
Charting Gold
Howard Katz

China Turns Tables on AAA Debt Time-Bomb Nations- Bloomberg

Canada Teaches Wall St How to Balance Books- Financial Post

Cost of Seizing Fannie/Freddie Surges for Taxpayers- CNBC

As China Aids Labor, Unrest Is Still Rising- NY Times

Dollar, Euro Fall as Yuan Change Boosts Asia- Bloomberg

China Signals End to Peg; Yuan Rising Like '05- Bloomberg

Gold at New Record High as Saudi Reserves Double- Financial Times

The U.S. Dollar Falls by Fall Posted: Jun 21 2010 By: Greg Hunter Post Edited: June 21, 2010 at 3:44 pm
Filed under: USAWatchdog.com
Dear CIGAs,

Last week, three stories acted as signposts for the direction of the U.S. Dollar. The first is about a letter President Obama sent to members of the G20 (Group of 20 major industrial countries) in advance of next weekend’s meeting in Canada. The President’s letter asked members to “reaffirm our unity of purpose to provide the policy support necessary to keep economic growth strong.” The policy he is talking about is to print money and run monstrous deficits to keep the world economy afloat. The talk in Europe is just the opposite. The EU these days is all about austerity and budget cuts which are hardly pro-growth. The Associated Press reported the story this way: In the letter, Obama said that the June 25-27 summit should also focus on efforts to stabilize public deficits in the “medium term,” a reference to the administration’s position that governments need to run huge deficits currently to provide the stimulus needed to ensure a sustained recovery but then move in future years to deficit reduction efforts. (Click here for the entire AP article.)
The second story illuminating the dollar’s path comes from Alan Greenspan. The former Fed Chief gave a warning about how the U.S. may soon reach its “borrowing limit.” A Bloomberg story quoted Greenspan saying, “The federal government is currently saddled with commitments for the next three decades that it will be unable to meet in real terms,” Greenspan said. The “very severity of the pending crisis and growing analogies to Greece set the stage for a serious response.” (Click here for the Bloomberg article.) Please note Greenspan’s reference for the U.S. “commitments” that it, “will be unable to meet in real terms.” That surely means the government will simply print money to pay its bills. The Federal Reserve could end up being the buyer of last resort for America’s debt, and that is highly inflationary.
This brings me to the third story indicating the future direction of the dollar. The headline says it all: “Gold hits record as investors seek alternate asset.” (Click here for the complete story.) The only conclusion you can draw is investors are seeking a stable store of wealth. According to world renowned gold expert Jim Sinclair(jsmineset.com), that spells trouble for the dollar. Sinclair said, “. . . that’s not a pleasant conclusion because it speaks of a currency system in the entire Western world that is being significantly challenged.”
In an exclusive interview with USAWatchdog.com, Sinclair compared the U.S. to Greece– the same as Greenspan. Sinclair said the dollar’s true weakness has been concealed because the attention has been on Europe. Sinclair said, “We’re rolling over in this so-called economic recovery . . . It’s not a pretty picture, and the focus will come off Europe as soon as all the currency traders have made all the money . . . (then) it’s coming right back here. . . You look over here and you see 33 states are headed towards bankruptcy. What’s the difference between that and Greece? There’s none.”
I asked Sinclair when will the dollar start plunging? He said, “The time horizon, I think, is four months.” A plunging dollar will quickly cause higher prices for goods and services and, if things get really bad, Sinclair says, “If, in fact, this thing gets out of control, you’ll see decreasing supply (of goods) because of economic disruption of the means of distribution.”
Under an extreme loss of value for the buck, you can forget about cheap oil and gasoline. Sinclair says, “If the dollar falls out of bed, they shoot to the moon.” Sinclair thinks what is taking place now is a “change in psychology and a loss of confidence that are now beginning to show themselves in market terms. You will still have the dollar around. It will still be in bank reserves, but its buying power will be severely reduced.”
This change in psychology is driving gold to one record high after another. Since 2001, Sinclair has been calling for gold to reach $1,650 a troy ounce by January 14, 2011. Some of Sinclair’s contemporaries are calling for gold to be much higher by next summer. $5,000 per ounce by June is one prediction. Sinclair says, “. . . that only occurs if the whole thing goes splat,” and that is also a real possibility.
Click to view the original article…

Jim Sinclair’s Commentary
The dollar versus the euro is purely a mirror image. Market focus is a product of media. Media is a product of those investment banks doing the work of "gawd."
The investment banks are the product of their positions taken.
The following will take place. When? When Gold Sacks wants it to.

Jim Sinclair’s Commentary
Market focus will change as soon as the gang is in their dollar short position.
California on ‘verge of system failure’ Barrie McKenna
Arnella Sims has seen a lot in her 34 years as a Los Angeles County court reporter, but nothing like this.
Case files piling up by the thousands, phones ringing off the hook, forced midweek courthouse closings and occasional brawls as frustrated citizens queue for hours to pay parking fines.
“People think we’re becoming a Third World country,” said Ms. Sims, 55. “They don’t understand.”
It’s a story that’s being repeated all across California – and throughout the United States – as cash-strapped state and local governments grapple with collapsed tax revenues and swelling budget gaps. Mass layoffs, slashed health and welfare services, closed parks, crumbling superhighways and ever-larger public school class sizes are all part of the new normal.
California’s fiscal hole is now so large that the state would have to liberate 168,000 prison inmates and permanently shutter 240 university and community college campuses to balance its budget in the fiscal year that begins July 1.

Jim Sinclair’s Commentary
33 US States are heading towards a stone wall at 200mph.
Golden State, like many others, is nearly bankrupt and desperately needs a bailout


Jim Sinclair’s Commentary
The mirror image that has made the dollar looks good will shift when the market is focused by the "good ole boys doing the work of gawd" on this reality.

Inside the Dire Financial State of the States By DAVID VON DREHLE Thursday, Jun. 17, 2010
In New Jersey, taxes are high, the budget’s a mess, government is inefficiently organized, and the public pension fund is blown to kingdom come. Which makes New Jersey a lot like most other states in 2010. What makes the state unusual is its rookie governor, a human bulldozer named Chris Christie, who vowed to lead like a one-termer and is keeping his promise with brio. He has proposed chopping $11 billion from the state’s budget — more than a quarter of the total — for fiscal year 2011 (which starts July 1). He’s backing a constitutional cap on property taxes in hopes of pushing the state’s myriad villages and townships to merge into more efficient units. He’s locked in an ultimate cage match with the New Jersey teachers’ union. It may be the bitterest political fight in the country — and that’s saying something this year. A union official recently circulated a humorous prayer with a punch line asking God to kill Christie. You know, New Jersey humor. And in an interview with the Wall Street Journal, Christie didn’t talk about the possibility that his fiscal initiatives might be compromised or defeated; he pictured himself "lying dead on State Street in Trenton," the state capital. Presumably that was a figure of speech.
The tone of the New Jersey budget battle may be distinctive, but many of the same notes can be heard in state capitals across the country. From Hartford to Honolulu, once sturdy state governments are approaching the brink of fiscal calamity, as the crash of 2008 and its persistent aftermath have led to the reckoning of 2010. Squeezed by the end of federal stimulus money on one hand and desperate local governments on the other, states are facing the third straight year of staggering budget deficits, and the necessary cuts will cost jobs, limit services and touch the lives of millions of Americans. Government workers have been laid off in half the states plus Puerto Rico. Twenty-two states have instituted unpaid furloughs. At least 28 states have ordered across-the-board budget cuts, with many of them adding deeper cuts in targeted agencies. And massive shortfalls in public pension plans loom as well.

Sunday, June 20, 2010

New monetary system may use gold at much higher price, Tocqueville's Hathaway says

Ambrose Evans-Pritchard: Gold reclaims currency status as global system unravels

Saudis hoard twice as much gold as thought

H.H. sent this: Venezuela Food Prices Skyrocket. H.H. asks: "How's that Socialist Revolution workin' out for ya, Hugo?"

story on CNBC that is of interest: 'Serious Market Problems' in the Fall—Gold to Hit $2500. Here's an excerpt: "In the meantime, Schatz said investors should expect a rally through June and into August—before seeing 'serious problems' in the fall. ...Taxes are going up next year and so on the surface, people are going to have less money to invest and less money in the economy,” he explained. “We’ve also got a municipal crisis coming on the horizon that no one’s talking about."

Spain: The New Crisis in Euroland

Food Prices to Rise Up to 40% Over Next Decade, UN Warns

Bank Run in Spain and its Destabilizing Ramifications for the Entire EU

Spain Plays High-Stakes Poker Game with Germany as Borrowing Costs Surge

Gold Rises as Euro Struggles, Share Prices Down

Spending Fable (The Mogambo Guru)

Saturday, June 19, 2010

This is how a tyrant controls the SHEEPLEZ...The fuse of revolution will be lit if this passes...

"Change you can believe in"???

Lawmakers Propose US 'Kill Switch' for Internet

Jim Sinclair’s Commentary
Greece is nothing compared to the 33 states of the USA charging at 200mph towards a stone wall of bankruptcy.

Nearly Bankrupt Illinois Forced To Pay Through The Nose To Borrow Money Joe Weisenthal Jun. 18, 2010, 9:02 AM

The market has lost confidence in Illinois, a state which has now adopted its own IOU system.
Illinois sold $300 million of Build America Bonds at a yield premium over Treasuries about 40 percent higher than two months ago after lawmakers failed to close a $13 billion budget deficit for the year starting July 1.
The fifth most-populous U.S. state sold the taxable debt maturing in 2035 priced to yield 7.1 percent yesterday, or 297 basis points over the 2040 Treasury to which it was benchmarked, according to data compiled by Bloomberg. Illinois offered Build Americas of similar maturity at spreads of 205 basis points and 210 basis points in two April issues, Bloomberg data show. A basis point is 0.01 percentage point.

Jim Sinclair’s Commentary
And exactly how do you get out of that danger?
In truth you do not. No one is going bailout the US except QE to infinity.

Greenspan: We’re In Danger Of Being The Next Greece! Joe Weisenthal Jun. 18, 2010, 5:51 AM
Former Fed Chair Alan Greenspan has an op-ed in the WSJ arguing that the runaway Federal Deficit threatens to turn the US into the next Greece.
He doesn’t actually think that the US debt bears any credit risk, due to our ability to print at will, but that there is a substantial risk that borrowing costs will soar.
Of course, market participants are aware of our towering deficit, and yet yields continue their long march lower, so that’s kind of problematic to his world view.
Says Greenspan: "This is regrettable, because it is fostering a sense of complacency that can have dire consequences."
Yet, he argues, not all market signals are so benign:
In the wake of recent massive budget deficits, the difference between the 10-year swap rate and 10-year Treasury note yield (the swap spread) declined to an unprecedented negative 13 basis points this March from a positive 77 basis points in September 2008. This indicated that investors were requiring the U.S. Treasury to pay an interest rate higher than rates that prevailed on comparable maturity private swaps.


The Move To $1650 And What It Means For Producers Posted: Jun 18 2010 By: Jim Sinclair Post Edited: June 18, 2010 at 2:27 pm
Filed under: General Editorial
Dear CIGAs,
It is my feeling that gold is headed on this move to $1650 with its normal drama.
Let’s think about what this means to gold producers.
With gold valued at $1650 per ounce:
- 500,000 ounces = $825,000,000 less the cost of mining. - 1,000,000 ounces = 1,650,000,000 less the cost of mining. - 2,000,000 ounces = 3,300,000,000 less the cost of mining.
- Underground average costs are approximately $500-$600 (assuming no derivatives or derivatives covered as international and Canadian GAAP requires derivative losses be expensed to the specific property). - Open cut average costs are approximately $300 (again, assuming no derivatives or derivatives covered). - On surface average costs are approximately $22-$75 (again, assuming no derivatives or derivatives covered).
Economist tips gold price to keep rising By resourceINTEL · June 18, 2010 · 9:58 am
THE price of gold could reach $US1450 an ounce by the end of the year after surging to a record high early yesterday, an economist says.
The precious metal settled at $US1248.70 an ounce on the Comex division of the New York Mercantile Exchange, up $US18.20, and nudged $US1248 in spot trade in Sydney yesterday.
Clifford Bennett, chief economist at independent research firm Herston Economics, said gold could fetch between $US1350 and $US1450 per ounce by the end of the year.
Mr Bennett said the most bullish predictions of a $US3000 per ounce gold price could be a reality by 2015. He was a strong believer in gold’s future, not for the usual reasons “based on fear” or it being a hedge against inflation.
“I know a lot of people back gold because they are worried about Europe, but I think Europe is fine. There are not going to be any defaults,” Mr Bennett said.
“Manufacturing is strong in Europe and the US, and China is still a juggernaut.
“I’m bullish on gold because the two most populous countries in the world, China and India, also happen to be the two fastest growing countries in the world.
“They are getting wealthier at a faster rate than anyone else and are the two countries that culturally value gold more than any other society.
“The demand for gold, just on increased wealth in China and India alone, is going to be tremendous, and when you add to that strong manufacturing, strong industrial production, from all three major continents in the second half of this year . . . demand could outstrip supply.”

Jim Sinclair’s Commentary
The real story is a 30 year consolidation in junior and intermediate gold shares which is about to break out to the upside.
Think seriously about what a 30 year consolidation formation means.

Finding Gold in the Mainstream By Frank Holmes, CEO and chief investment officer, U.S. Global Investors
The New York Times dedicated a chunk of last Sunday’s paper to gold as a mainstream investment. In other words, gold is now legit — no longer can it be dismissed as the asset of choice for fringe types with a cellar full of canned goods and a stash of bullion buried in the backyard.
And to illustrate just how far gold has moved into the American mainstream, the paper goes bipartisan by holding up investor George Soros on the left and commentator Glenn Beck on the right as examples of the newly converted.

Now there’s an old saying that the time to sell an investment is when it’s finally “discovered” by the popular media, but that may not be good advice for gold in today’s environment. This week spot gold and gold futures hit all-time highs as the latest government reports cast doubts on the economic recovery.
In its story, the Times points out many of the same gold drivers that we have been citing for a while now – the tandem risks of near-term deflation and longer-term inflation, massive U.S. budget deficits and crushing sovereign debt burdens in Western Europe that threaten the euro’s viability.

Mark Skousen: Gold Surge Points to Higher Inflation

The latest bank casualty in the FDIC's Friday Follies: Nevada Security Bank. (It is notable that the pace of bank failures is more than double last year's.)

Greenspan Says US May Soon Reach Borrowing Limits

Fannie-Freddie to Delist Shares from NYSE

Coffee Prices Jump 20% in One Week

Deficit Terrorists Strike in the UK

Job Woes Persist as Jobless Claims Rise

Ambrose Evans-Pritchard: The Euro Mutiny Begins

Friday, June 18, 2010

"Political correctness is tyranny with manners." - Charlton Heston

"America faces a new culture war. This is not the culture war of the 1990s. It is not a fight over guns, gays or abortion. Those old battles have been eclipsed by a new struggle between two competing visions of the country's future. In one, America will continue to be an exceptional nation organized around the principles of free enterprise--limited government, a reliance on entrepreneurship and rewards determined by market forces. In the other, America will move toward European-style statism grounded in expanding bureaucracies, a managed economy and large-scale income redistribution. These visions are not reconcilable. We must choose." - Arthur C. Brooks, The Washington Post, May 23, 2010

Greenspan: US Reaching Borrowing Limit- Wall Street Journal

Gold Running in Short Supply.

Gold is an Armageddon Hedge

How All Of Us Pay for The Derivatives Market (Caution: There is a bad word in the title.....)

It's The Ratios, Stupid (Why the US Will Default on its Debt)

Home Construction Sinks, Building Permits Down

The Snowball Scenario Sinks Sovereigns

World Bank Says China's Economy Slowing

Medvedev: Russia to Help Spur New Economic Order- BusinessWeek

IL Sells Build America Bonds as Premium Climbs- Bloomberg

Fed Emerging Intact from Challenge to Its Power- Wall Street Journal

In UK, 'Spend Now, Pay Later' Is Over; Later Is Now- Daily Telegraph

Germany's Weber Defies Trichet over Bailout- Bloomberg

Gold on Longest Winning Streak since 1920- Financial Post

The Dollar's Strong! (But Not The One You Think)- CNN Money

Thursday, June 17, 2010

Thus, the fight over gold and silver as media of exchange is about more than mere money, let alone making money. For it is a fight with only two possible outcomes: either control of their own lives by the people themselves, or control of the people and their lives by political and economic elitists. - Dr. Edwin Vieira

GoldWatch: Why Many Respected Analysts See Gold Going Up to $10,000

Price Increases Fuel Fears of Food Crisis- Financial Times

Senate Dems Dismantling Aid Package due to Deficit- Washington Post

Fannie/Freddie to Delist Shares from NYSE- Yahoo! Finance

S&P Warns of Rising Corporate Defaults- NY Times

As I have said for 2 years...All Countries,cities, counties and states will be bailed out...They will print money till we run out of trees...
NY Stopgap Bills Approved, Avoiding State Shutdown- Bloomberg

This is a complete lie...
Inquiry: CDS Did Not Cause Greek Crisis- Financial Times

Jim Sinclair’s Commentary
The CDS OTC derivatives claim another victory.
Of course they got help from the rating agencies and the IMF statements.

Bank Run in Spain and Its Destabilizing Ramifications for the Entire EU Wednesday, June 16, 2010
Spanish banks are borrowing record amounts from the European Central Bank.
According to FT, Spanish banks borrowed €85.6bn ($105.7bn) from the ECB last month. This was double the amount lent to them before the collapse of Lehman Brothers in September 2008 and 16.5 per cent of net eurozone loans offered by the central bank.
“If the suspicion that funding markets are being closed down to Spanish banks and corporations is correct, then you can reasonably expect the share of ECB liquidity accounted for by the country to have risen further this month,” said Nick Matthews, European economist at RBS.
Bottom line: This is nothing but a sign of a run on Spanish banks. They can’t get funding in the markets and there is a steady withdrawal of funds from the banks. For all practical purposes, the ECB is supporting the Spanish banking system with life support measures. This means that the ECB will have to drain funds from elsewhere in the system to sterilize this rescue operation. Without sterilization the effort becomes very inflationary, with sterilization the effort distorts the entire EU economy. It’s all destabilizing.
The only reasonable alternative is to allow the Spanish banks to go into bankruptcy and restructure.

Obama Officially Begins Push For New Bailout of the States.

"Housing Still Sluggish"---Harvard study uses the "D" word to describe the real estate market

From the ever-cheery Ambrose Evans-Pritchard: AXA fears 'fatal flaw' will destroy eurozone.

a recent audio podcast interview of Gerald Celente by Lew Rockwell.

Volcker Warns: We Are Running Out Of Time

EU Chief Warns "Democracy Could Disappear" in Greece, Spain and Portugal

Hidden Debt is UK's Real Monster

US Banks Set to Lose Swaps Fight

How to Plan for a Double-Dip Recession

BP's Downside is Worse than You Thought

Now why would the FED do this, unless we are heading for hyperinflation...

Fed Adopts Rules to Protect Credit Card Customers

Calvin in Kansas mentioned a YouTube video of a former Marine singing an oft-ignored verse of our national anthem: The Star-Spangled Banner. The later verses aren't considered politically correct. The anthem's lyrics were derived from the the poem "Defence of Fort McHenry", written by Francis Scott Key, in 1814. The full lyrics, by the way, are worthy of some study and pondering.)

"Life is not a matter of holding good cards, but sometimes, playing a poor hand well."

- Jack London