Marc Faber Calls Bernanke A Liar, Thinks US Inflation Is Running Up To 8%, Believes Pakistan Will Fall Next

Submitted by Tyler Durden on 02/02/2011 11:20 -0500

Marc Faber is on a roll these days. The Gloom, Doom and Boom report author, who recently made headlines after calling Obama a whore minutes ahead of the president's SOTU address, proceeds to go on a truthiness rampage, and with his now traditional grin, proceeds to call Satan Bernanke a "liar" to the entire CNBC Europe audience. In addition to making his thoughts clear on the topic of inflation (5-8%), he also observes where the Egyptian riots will strike next: "You may not have a problem in Saudi Arabia and in the Emirates, in Kuwait and Qatar, because there the governments can heavily subsidize food if they want to. But I am worried that what has happened in Egypt will happen in Pakistan... I think Egypt is a reminder to people that politics, and social events, and geopolitics have a meaningful effect on asset markets. The developed markets have way outperformed, and now I think that it may be a wake up call that the US outperforms emerging economies for a while." As for inflation "The annual cost of living increases are more than 5% today and the BLS is continuously lying about the inflation rate, including Mr Bernanke, he's a liar. Inflation is much higher than what they publish. I think that inflation is between 5% and 8% per annum in the US, and in Western Europe, a little bit lower, also 4-5% per annum." Oh yeah, Pakistan has nukes. 

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In The News Today

Posted: Feb 02 2011     By: Jim Sinclair      Post Edited: February 2, 2011 at 2:03 pm
Filed under: In The News
Dear CIGAs,
Ok, I could not help it. My tracked vehicle is unstoppable in the snow. I just got in from a ride through the woods cutting tracks in snow I couldn’t tell you how deep it was. The undercarriage plows snow and will not let the vehicle get hung up. Six gigantic lights look forward and backwards making this thing look like a snow vehicle from outer space. First gear rumbles a bit – it is required to make it uphill.
Uphill in this thing is like no uphill ever. It climbs in deep snow up to a 70% slope. The vehicle undulates as the snow does giving you the feel of a boat going through swells.
Work hard and occasional play with sattvic toys is required to keep things in perspective. What we are doing in gold is 100% right regardless of significant reactions common to a higher price.
Now back to business. Later tonight we will be back to the blizzard. Living on a farm is the only way to go for a lot of reasons.

Jim Sinclair’s Commentary
What does the Fed know that financial TV does not? The entire Western world financial community is broke. The fragile recovery is Happy Juice from the Dow.
Fed passes China in Treasury holdings By Michael Mackenzie in New York
Published: February 2 2011 00:01 | Last updated: February 2 2011 00:01
The Federal Reserve has surpassed China as the leading holder of US Treasury securities even though it has yet to reach the halfway mark in its latest round of quantitative easing, according to official figures.
Based on weekly data released on Thursday, the New York Fed’s holdings of Treasuries in its System Open Market Account, known as Soma, total $1,108bn, made up of bills, notes, bonds and Treasury Inflation Protected Securities, or Tips.
According to the most recent US Treasury data on foreign holders of US government paper, China holds $896bn and Japan owns $877bn.
“By June [the Fed] will have accumulated some $1,600bn of Treasury securities, likely to be in the vicinity of China and Japan’s combined holdings,” said Richard Gilhooly, a strategist at TD Securities. “The New York Fed surpassed China in the past month as the largest holder of US Treasury securities,” he noted.
The Fed is buying Treasury debt under two programmes. The largest is QE2, which began in November and is scheduled to involve $600bn of purchases by June.
It is also buying $30bn of Treasuries a month as it reinvests principal payments from its large holdings of mortgage debt and debt issued by government housing agencies – a programme dubbed QE lite.
More…

Hourly Action In Gold From Trader Dan

Posted: Feb 02 2011     By: Dan Norcini      Post Edited: February 2, 2011 at 2:06 pm
Filed under: Trader Dan Norcini

Dear CIGAs,
Click chart to enlarge today’s hourly action in Gold in PDF format with commentary from Trader Dan Norcini

Jim’s Mailbox

Posted: Feb 02 2011     By: Jim Sinclair      Post Edited: February 2, 2011 at 1:56 pm
Filed under: Jim's Mailbox

Fed passes China in Treasury holdings 

CIGA Eric
What does the Fed know that financial TV does not? The entire Western world financial community is broke. The fragile recovery is Happy Juice from the Dow.
Jim

The Fed knows that primary dealers, the credit broker for the Fed and Treasury, have steadily withdrawn from bond and note auctions since 2008. Indirect buyers, such as foreign monetary authorities, and anonymous direct buyers have filled the void created by their withdrawal. The latest 5-year bond auction illustrates this trend that financial TV cannot recognize.
5-Year Bond Auction
Headline: Fed passes China in Treasury holdings
The Federal Reserve has surpassed China as the leading holder of US Treasury securities even though it has yet to reach the halfway mark in its latest round of quantitative easing, according to official figures.
Based on weekly data released on Thursday, the New York Fed’s holdings of Treasuries in its System Open Market Account, known as Soma, total $1,108bn, made up of bills, notes, bonds and Treasury Inflation Protected Securities, or Tips.
According to the most recent US Treasury data on foreign holders of US government paper, China holds $896bn and Japan owns $877bn.
Source: ft.com
More…