Gold is already the true reserve currency and silver will join it, Sprott tells BNN

 

 

The Coming "New World Order" Revolution: How Things Will Change In The Next 20 Years - A Kondratieff Cycle Perspective

SocGen has published a fantastic, must read big picture report, which compares the world in the 1980/1985-2000/2005 time period and juxtaposes it to what the author, Veronique Riches-Flores predicts will happen over the next two decades years, the period from 2005/2010 to 2025/2030. Unlike other very narrow and short-sighted projections, this one is based not on trivial and grossly simplified assumptions such as perpetual growth rates, but on a holistic demographic approach to perceiving the world. At its core, SocGen compares the period that just ended, one in which world growth was driven by an expansion in supply, to one that will be shaped by an explosion of demand. And, unfortunately, the transformation from the Supply-driven to the Demand-driven world will not be pretty. Summarizing this outlook: "Over the last three decades strong growth in the working-aged population across Asia and the opening-up of world trade have led to considerable expansion in global production capacities. These factors created a highly competitive and disinflationary environment of plentiful supply, which was characterised by low interest rates, a credit boom and, in the financial markets, exuberant appetite for risky assets. As the demographic cycle progresses, we are seeing the emergence of an aging population, which is less favourable to productive investment. Meanwhile the rise in living standards among the emerging population heralds an unprecedented level of growth in demand. The world supply/demand balance is dramatically changing against a backdrop of resource shortages which are likely to favour shorter cycles, increased government intervention in economic affairs and inflation." In other words, contrary to what you may have read elsewhere, the future is about to get ugly. And topping it all off is a Kondratieff cycle chart: what's not to like. Read on.

Goldman Flip Flops Once Again: Mocks IEA Impact On Crude Prices, Reiterates 20% Upside In Commodities, Buying Gold 

Submitted by Tyler Durden on 07/06/2011 22:50 -0400

At this point we refuse to even recall whether Goldman is long or short oil. Probably so does Goldman, whose Brent recos have become the same laughing stock as Tom Stolper's EURUSD "strategic" price targets in 2010. Yet Jeffrey Currie has found a new way of dealing with appearing idiosyncratically idiotic. Instead of focusing on any one product, the firm has just upgraded (or rather, maintained its buy) the entire commodity space wholesale: "Progress in dealing with the Greek budget crisis and better economic data have improved sentiment around cyclical assets in recent days. We continue to expect further increases in commodity returns later this year and into 2012. We maintain our overweight recommendation for commodities on a 3-, 6- and 12-month horizon and our 20% 12-month commodity returns forecast." Um, yeah, this comes less than two weeks since the last flip flopping on the matter: "The International Energy Agency announced today that its member countries have agreed to release 60 million barrels of oil from their emergency stocks over a period of 30 days. The IEA has coordinated this release, only the third in its history, in response to the ongoing loss of Libyan light sweet crude oil production and the impact that the resulting higher crude oil prices are having on the world economy. We estimate that a 60 million barrel release by the end of July has the potential to reduce our 3-month Brent crude oil price target by $10-12/bbl, to $105-107/bbl. 125/bbl." Way to preserve street cred there Jeffrey. Of course, the aforementioned flipflopping does not prevent Goldman from mocking the IEA's ridiculous SPR release decision, as well as reiterating its upside expectation in the metals space, with an emphasis on gold, copper and zinc. As a reminder, if Jeffrey says "buy", run, Forest, run. 

Guest Post: Senior-Sub Question On Risk: Part Two Of Three 

Submitted by Tyler Durden on 07/06/2011 19:14 -0400

If there was ever a setting where you would think risk is properly appreciated it would be in European banks. Look at total return on senior-sub financial European financial s since 2004. On a total return basis, European senior bank debt has outperformed subordinate debt. As a matter of fact, you’ve lost money if you own a portfolio that replicates the BarCap sub debt index going back to late 2004. Question: Why is sub such a persistent loser in times of crisis, precisely when people should be demanding compensating return for the risk?

 

In The News Today

July 6, 2011, at 6:38 pm
by Jim Sinclair in the category In The News |  Print This Post |  Email This Post

 

Jim’s Mailbox

July 6, 2011, at 6:37 pm
by Jim Sinclair in the category Jim's Mailbox |  Print This Post |  Email This Post

QE to end all QEs

CIGA Eric

Challenger suggests that the employment picture remains “cloudy.” A potential short-term inflection point within an up trend in planned layoffs confirms this outlook. Keep this in mind as the talking heads spin QE2 as the QE to end all QEs.
Challenger, Grey, and Christmas Announced Layoffs (ALO) And YOY Change
Headline: Planned layoffs rise in June: Challenger
The number of planned layoffs at U.S. firms increased for the second month in a row in June, though downsizing in the first half of the year was at the lowest level since 2000, a report on Wednesday showed.
Employers announced 41,432 planned job cuts last month, up 11.6 percent from 37,135 in May, according to the report from consultants Challenger, Gray & Christmas, Inc. Job cuts were up 5.3 percent from 39,358 in June last year.
"The employment picture remains a bit cloudy," John Challenger, chief executive of Challenger, Gray & Christmas, said in a statement.
Source: finance.yahoo.com
More…

BIS Changed Silver Data (From $203 to $93 Billion in Silver Liabilities?)

Greeks Buy Time for Insolvent Bankers and Delusional Politicians
By: John Browne, Euro Pacific Capital

 

 

US Treasury Secretly Weighs Options to Avert Default

A small team of U.S. Treasury officials is discussing options to stave off default if Congress fails to raise the debt limit by the August 2nd deadline, sources familiar with the matter said on Wednesday.

 

 

 

Economic Armageddon and You...Prepare for the Worst...

Jim Sinclair’s Commentary

Here is the entire story. I would suggest spreading the truth to offset the lies. 

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