Not To Own Gold Is To Trust The Value Of Paper Money

posted by Admin at Marc Faber Blog - 1 hour ago

Not to own gold is to trust the value of paper money and the government's integrity. No one in his right mind could trust the U.S. government any more. The government's economic statistics are distorted ...

 

 

 

 

When You Own Gold, You're Fighting Every Central Bank in the World

Posted by: smartknowledgeu

Post date: 06/15/2011 - 04:28

Here is an exclusive interview forwarded to me by German investigative journalist Lars Schall conducted with James G. Rickards. The interview with Mr. Rickards covers a variety of topics including his thoughts on quantitative easing, the currency wars of the past and the present, and central banks’ views towards gold.

 

 

 

 

Contagion Risk Increases – Euro Falls As Moody’s May Cut Rating On 3 Large French Banks Exposed To Greece 

Submitted by Tyler Durden on 06/15/2011 07:20 -0400

The euro has fallen on international markets as the European sovereign debt crisis is deepening and appears to be reaching a dangerous denouement. European stock markets are also weaker due to serious divisions in Greece and in the EU as to how to resolve the Eurozone debt crisis and prevent contagion. Moody's has placed three large French banks on negative review based on their exposure to Greece. The problem looks increasingly intractable meaning that contagion appears more likely every day. Gold is higher against the euro, pound and Swiss franc and lower against the U.S. dollar, the yen, Kiwi and Aussie dollar. Demand continues to be very strong especially from China and India where the World Gold Council said that there is a “tidal wave” of “gold demand coming”. The dollar is firmer despite yesterday’s stern warning from Bernanke that America’s credit rating is at risk. Bernanke urged policy makers to again increase the debt ceiling – this time to over $14.3 trillion – in the hope that this will prevent a U.S. downgrade.

 

 

 

 

 

Greece Is Imploding!

Posted by: Smart Money Europe

Post date: 06/15/2011 - 07:10

Meanwhile, in Athens…

 

 

 

 

Televizing The (Second) Greek Revolution - Three Live Streams From Syntagma Square 

Submitted by Tyler Durden on 06/15/2011 07:03 -0400

Greece's D-Day has arrived: June 15 may soon be the 2011 equivalent of May 6, 2010 when the reaction to the realization that Greece was insolvent hit the population, together with a peak in hostilities, not to mention the US market flash crashing. In addition to a general strike, thousands are already packing the central Syntagma square in Athens, where MPa have started congregating to commence deliberations on the Troica's mid-term fiscal proposal. Already there has been tear gas fired at protesters who are gradually shifting away from their peaceful posture and slowly becoming unruly. Below is a live feed of the square as well as a link to an English live blog following up to the minute events. 

 

 

 

 

Greek PM Prepared To Step Down To Form Alliance Government Even As Opposition's Samaras Demands Substantial Renegotiation Of Bailout Terms 

Submitted by Tyler Durden on 06/15/2011 10:50 -0400

Developments in Athens are to say the least fluid. The latest news out of Athens News states that G-Pap is prepared to step down in order to form an all-party consensus government with the main opposition party, New Democracy. "Prime Minister George Papandreou held talks with main opposition New Democracy leader Antonis Samaras on the telephone on Wednesday, after a round of telephone calls with the leaders of the other political parties in Parliament. Their conversation lasted roughly 20 minutes. While an earlier official announcement by ND had refused to disclose the content of their talks before Papandreou had expressed his position, unnamed sources within the party said that the prime minister had described the situation as extremely difficult and that he was prepared to consider either an all-party government or a broader alliance government. The same sources said that Samaras did not reject the proposal but made it clear that this could not work with Papandreou as prime minister. To this, always according to ND sources, Papandreou apparently replied that he was not concerned about whether he was prime minister." And while the political wrangling is irrelevant for the rest of the world, what is relevant, especially for the ECB which would need a bail out by the Fed should Greece default is the following: "Samaras has apparently made it a condition that there is a substantial renegotiation of the terms of the Memorandum for the loans to Greece, in order to agree to an all-party government." Good luck passing that by the Troica. In other words, Greece is now in a power vacuum and the worst case outcome for Europe appears set to be realized.

NAHB Builder Confidence Plunges To September 2010 Levels 

And another index drops to levels last seen just as QE2 was unwinding. Per the NAHB: "After holding at a low but steady level for the past six months, builder confidence in the market for newly built, single-family homes declined three points in June to a reading of 13 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The last time the index was this low was in September of 2010. "Builders are being squeezed by the continuing weakness in existing-home prices – against which they must compete -- as well as rising material costs," said NAHB Chairman Bob Nielsen, a home builder from Reno, Nev. "In addition to the ongoing impacts of distressed property sales on home prices, appraisal values and consumer confidence, rising costs for materials such as roofing, copper, wallboard, vinyl siding and other components have made it extremely difficult to construct a new home and sell it at a price that covers the costs....Builder confidence has waned even further as economic growth has stalled, foreclosures have continued to hit the market and the cost of building a home has risen," agreed NAHB Chief Economist David Crowe. "Meanwhile, potential new-home buyers are being constrained by difficulty selling their existing homes, stringent lending requirements, and general uncertainty about the economy. Economic growth must pick up in order for housing to gain the momentum it needs to get back on track." Yet fear not: Wall Street's econometric lemmings say the economy will surge in the second half on more hope and change. It is unclear what besides hope and change will cause this miraculous surge, although Operation Twist 2, which now seems guaranteed, appears to be the best guess.

This Is Probably Not Good 

Submitted by Tyler Durden on 06/15/2011 10:11 -0400

BARCLAYS'S JENKINS SAYS `SERIOUS' PROBLEMS IN EUROPEAN UNIT
For those who may have forgotten, back in the summer of 2007 Bear Stearns had some problems with some of its own units as well...

Guest Post: Mr. Bernanke's Manipulation Nation 

Submitted by Tyler Durden on 06/15/2011 09:50 -0400

Manipulation is the beating heart of Federal Reserve and Central State policies. The centrally planned economy has failed to respond as expected, and so the response is to put more cocaine-laced pellets in the feedbox and encourage the poor starved rat inside the cage to press the bar labeled "debt" to get another pellet of addiction and highly profitable enslavement. Welcome to Manipulation Nation, a.k.a. the unlimited debt experiment. Think rat cage, one bar to press, and unlimited cocaine-laced pellets. 

 

 

 

 

 

3 Year Greek Bonds Trading At 28.6% 

Submitted by Tyler Durden on 06/15/2011 09:43 -0400

At this point the Greek bond market is pretty much irrelevant, although it bears pointing out that the 3 Year is now at 28.6%. Also, the price on the 4.6% 30 year just hit 40.5 cents on the dollar. That Cheapest to Delivery physical CDS settlement sure is going to be fun, and for nobody more so than for the ECB, which will suddenly find itself with a basement full of live collateralized grenades that are not only worthless but that will set off the avalanche that annihilates the asset side to the EUR liability side. 

 

 

 

 

Stagflation Trifecta Complete: Industrial Production Misses Expectations 

Submitted by Tyler Durden on 06/15/2011 09:30 -0400

Industrial production edged up 0.1 percent in May, the second consecutive month with little or no gain. Revisions to total industrial production in months before May were small. In May, manufacturing production rose 0.4 percent after having fallen 0.5 percent in April. The output of motor vehicles and parts has been held down in the past two months because of supply chain disruptions following the earthquake in Japan. Excluding motor vehicles and parts, manufacturing output advanced 0.6 percent in May and edged down 0.1 percent in April; the decrease in April in part reflected production lost because of tornadoes in the South at the end of the month. Capacity utilization for total industry was flat at 76.7 percent, a rate 3.7 percentage points below its average from 1972 to 2010. 

 

 

 

 

 

Raging Stagflation: Inflation Higher As Empire State Mfg Index Tumbles, Confirms Contraction 

Submitted by Tyler Durden on 06/15/2011 08:47 -0400

June brings us much more centrally planned stagflation.CPI increased 0.2% in May, higher than expected 0.1%, and up 3.6% Y/Y. This is the 11th consecutive increase in inflation. And so much for the CPI ex-Food and Energy which came at +0.3% on expectations of 0.2%, up from 0.2% in April: "The index for all items less food and energy increased 0.3 percent in May, its largest increase since July 2008. The indexes for apparel, shelter, new vehicles, and recreation all contributed to the acceleration, rising more in May than in April. These increases more than offset declines in the indexes for airline fare, tobacco, and personal care." More on the Chairman's failure to rein in inflation in 15 minutes: "The food index rose in May as well. The food at home index repeated its April increase of 0.5 percent as four of the six major grocery store food group indexes increased, with the index for meats, poultry, fish, and eggs rising the most. In contrast, the energy index, which had been rising sharply, declined in May. The gasoline index decreased for the first time since last June, although the index for household energy increased. The upward trend among the 12 month increases of major indexes continued in May. The 12 month change in the all items index, which  was 1.1 percent as recently as November, reached 3.6 percent in May. The energy index has increased 21.5 percent over the last 12 months, the food index has risen 3.5 percent and the index for all items less food and energy has increased 1.5 percent. All of these figures have been rising in recent months." But the real action was in the Empire Manufacturing Index which plunged from 11.88, and forget about expectations of 12.00, printing at -7.79 in June. The contraction is now confirmed. This is the first contraction since November 2010 when QE2 began. Hint: QE3 is coming. Also, the future general business conditions index fell thirty points, reaching 22.5, its lowest level since early 2009. And the kicker: margins continued to collapse as prices paid fell less than prices received. This is what stagflation is pure and simple; it has also been Zero Hedge's keyword of 2011 since January.

S&P Downgrades Four Main Greek Banks From B To CCC On Deposit Flight Concerns And, Well, General Bankruptcy Fears 

Submitted by Tyler Durden on 06/15/2011 07:31 -0400

S&P lowered its long-term credit ratings to 'CCC' from 'B' on four Greek banks--National Bank of Greece S.A. (NBG), EFG Eurobank Ergasias S.A. (EFG), Alpha Bank A.E. (Alpha), and Piraeus Bank S.A. (Piraeus). "In our view, outflows of domestic deposits could conceivably continue to intensify depending on the public's view of the impact that Greece's deteriorating creditworthiness may have on the banking system. The downgrade also reflects the significant risks to the Greek banks' capital bases that we believe may arise should the government restructure some, or all, of its debt." 

 

 

 

 

 

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