What Happens When A Paper Currency Fails?

Posted by : thetrader

Post date: 07/30/2011 - 04:05

Hyperinflation.....

 

 

Harvey Organ, Saturday, July 30, 2011

Debt Ceiling Deadlock/USA set for Downgrade/Huge gold and silver standing at comex

Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 2 hours ago

Good evening Ladies and Gentlemen: Before commencing, let me introduce you to the latest financial entities who have entered our banking morgue having taken their last breath last night: 1. Integra Bank  Evansville Ind. 2. Bank Meridian,  Columbia SC 3. Virginia Business Bank of Richmond Virginia 4. Landmark Bank of Florida, Sarasota Florida 5. Bank of Choice, Greeley Colorado. May they

 

 

 

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The Definition of Safe Haven Will Change

Eric De Groot at Eric De Groot - 2 hours ago

Talking heads focus on short-term problems while capital discounts long-term, structural risks of a dollar-centric monetary system. The public's definition of safe haven will change dramatically today's anticipatory actions become reality over the next 4.3 years. Bond market money flows continue to reflect a bearish setup into strength. US Treasury Bond 20YR+ (TLT) And US Treasury Bond... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] 

 

 

 

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Repeat of 1939 in 2010

Eric De Groot at Eric De Groot - 3 hours ago

The proper comparison would be a repeat of 1939 in 2010. 1929-1944 & 2000-Present Comparison: S&P 500 to Gold ($/oz) Ratio Most of the market weakness of recent days has been widely blamed on the trouble out of Washington. That's obvious enough. But I keep thinking, suppose the obvious is wrong. Supposing we are experiencing a repeat of the huge rally of 1929-1930, at a time when the... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] 

 

 

 

 

With The US Economy Sliding Back To Recession, Here Is What The Fed Will Do Next

Back in May when we presented our humble and succinct analysis on what the preliminary 1.8% GDP looked like, we said "Ex the now traditional inventory build [of 1.2%], Q1 GDP growth was sub 1%" basically being the only party who said that aside for the "old faithful plug" better known as the traditional BEA fudge to get GDP to whereever the administration wants it, growth was where it ultimately ended up being: 0.4%. And the kicker? The primary cause of the downward revision was, you guessed it, Inventories, which imploded from 1.31% to 0.32% (see chart). In other words, the next time we are skeptical about government data in any format, believe us, and not "them." Which also goes for our skepticism when it comes to the predictive ability of one Goldman Sachs, most notably our take on Goldman's December 1 2010 "watershed" report in which Hatzius said: "This outlook represents a fundamental shift in the thinking that has governed our forecast for at least the last five years... Five years ago, we became very pessimistic about the US economic outlook...So why do we now expect growth to pick up?  In a nutshell, it is because underlying demand has strengthened significantly" Total and utter fail. Our summary then was also rather spot on: "Much more hopium inside. This is unfortunate. Jan Hatzius used to have credibility." Indeed, after waiting for so long, the firm once again capitulated per its most recent report released last night: "Our forecasts for 3%-3.5% growth in Q4 and 2012 are under review for probable downgrade." So with apologies for the self-backpatting, this brings us to the topic of this post. As we have said for over a year, the catalyst for QE3 will be...

Goldman Weekly Chartology: "Investors In Full Risk Off Mode"

As Goldman's David Kostin summarizes in his latest weekly kickstart chartology, the market continues to be a dueling story between slightly better micro (although certainly not in Europe) and deteriorating macro. "Two weeks ago the narrative of the market was the triumph of politics and profits. News from inside the Beltway suggested a deal to curtail spending and raise the federal debt ceiling was in sight and a steady sequence of very strong earnings reports led by the Information Technology  sector combined to push the market higher. However, the news this week was decidedly less market-friendly....Our client discussions indicate investors are in full “risk-off” mode and they plan to continue that posture until sovereign uncertainty subsides. Lack of conviction regarding the outcome of politically-charged fiscal negotiations has compelled hedge funds to reduce risk by lowering gross exposure and mutual funds to stay close to benchmarks. Investors are refocusing on corporate balance sheet strength as a key factor in the stock selection process and we re-balanced our strong and weak balance sheet baskets. 331 stocks have released 2Q earnings and the results have been strong although several firms slashed 2H guidance during the past week." And as a reminder, the bulk of the upside has come from one company alone: Apple. Also, it is gradually getting uglier on the earnings front: "During the past week a number of firms reduced EPS guidance for 2H. Examples include ITW, JNPR, MUR, and SO. Several firms specifically commented that business activity slowed sharply in June and July." And with a slew of financials reporting shortly, next week is sure to tip investor sentiment further into derisking mode.

Weekly Bull/Bear Recap: July 25-29, 2011

Your one stop summary for all the major bullish and bearish events in the past week.





Greece Suffers New Credit Downgrade




The Kabuki Theater Of America's Debt Ceiling




The $1 Billion Armageddon Trade Placed Against The U.S.




The World According To Gold -- Literally




Debt Downgrade, Not Default, Is The Problem




Economy Recovery?

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