Fear Sets In, Panic Begins, Ruin Perceived, Prepare for Gold $2100

 

 

 

Annual Inflation Hits 4%

There is the CPI... and then there is the MIT's billion price project which, as the name implies, tracks the prices of a billion products in real time. And according to the latter, annual inflation has hit a multi year high of about 4%. Perhaps someone can advise the talented Mr Evans that the 3% inflation he would so love to achieve... has in fact been eclipsed. At least, according to the real world. So take 4% inflation, add $2.5 trillion in "much more" easing, and what you get is only an economic Ph.D.'s guess. Alas, we are unqualified to have an opinion on the matter.

 

 

 

Chuckie Evans Goes Full QEtard: Tells Hilsenrath Fed Needs To Do "Much More" Easing

Confirming that the Fed's doves, every single one of them, are genocidal sociopaths, we have a repeat appearance from Chicago's Chuckie Evans, who first sent stocks barreling in the latest algo driven, no volume meltup, earlier, this time dodecatupling down, by telling Fed lackey Jon Hilsenrath that "we need to do much more to increase the level of accomodation"... much more as in the ~$2.5 trillion of debt that needs to be monetized in the period before Obama's desperate reelection campaign. And by "we", he means the group of 12+1 madmen bundled up in a room in the Marriner Eccles building with or without padded walls, who unlike a simple unfunded blog, believed that Q4 GDP in the US would be about 4% instead of the negative print it is about to be in a few short months. Yes sure: lets give the sociopaths-cum-Econ Ph.D's another run at destroying the world: just because the Arab Spring was not enough to demonstrate just how efficient the Fed is at toppling regimes, this time around they will make sure that the revolutionary wave sweeps across Asia, through Europe, and ends on the banks of the Potomac. Of course, if in the process it also brings with it the much desired hyperinflation that will make the US banking sector whole, who cares if a few million people die - at least Wall Street, which has long since converted its fiat wealth into gold and other real money, will be spared, go on a 5 year vacation to non-extradition Libya, then come back when the shotguns have rusted, and the pitchforks have been dulled, and pick up where they left off. Because as we all know, nobody is more "intuitive" than an Econ. Ph.D, and nobody can create greater financial innovation, aka the primary export of the US, the than someone from New York's Financial District.

Guest Post: The Rise And Fall Of US Confidence, Or Why The Fair Value Of Gold In Phase Space Is $6,000-$12,000

Today we look at a graph of confidence in the US system. The US confidence ratio represents the ratio of outstanding US Federal debt to the dollar value of US gold holdings (as reported*). No corrections for inflation should be necessary, as both terms are valued in the same depreciating dollars. We use the term confidence as the ability of the US to stretch this ratio to (by our thinking) absurd multiples was a reflection of the world's confidence in the United States--which differs from the ability to actually repay debts. Confidence level sank throughout the Depression up until the beginning of WWII, after which ascendant American power was reflected in a climbing confidence ratio up to the oil crisis in the early 1970s. Confidence sank as the US withdrew from Viet Nam and inflation rose until the price of gold rose sufficiently to restore confidence in American solvency. From 1980 to 2001 was a golden age for the US. In this time, both stock and bond markets were strong, the US currency was strong, and the only credible opposition to US hegemony disintegrated. But every bubble meets its pin, and ever since the planes hit the towers, the US power and prestige has gone into decline. This decline is marked by a rapid decline in the confidence index. How low will it go? There is a provocative looking left shoulder and head, suggesting a drop to the neckline somewhere around 2020, after which there may be something of a resurgence in American confidence. The anticipated completion of the bankruptcy head-and-shoulders formation promises to be a hair-raising event.

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India makes buying Gold easier

Posted by: Michael Victory

Post date: 08/30/2011 - 14:12

More than just "tradition".   

Who Will Protect You In These Outrageous Markets

August 30, 2011, at 2:43 pm  

by Jim Sinclair in the category General Editorial |  Print This Post |  Email This Post

Dear Extended Family,

Gold corrects $212.50, rises $50, drops $50 and today is trying to rise another $50.

That is a range of roughly $275 in just a few days. That is certainly what I call a hard chop, this time with a penchant to break out to new highs. That is exactly what I expect.

Kenny Adams points out that he feels 15 to 18 days from the first break is the fastest that this chop can resolve itself to a new high.

I have told my family, outside of myself, that there are two people who would protect them in these outrageous world markets. It would be Monty Guild for investments and Kenny Adams for speculation. Both match uncommon skill with absolute ethics.

Regards,
Jim

In The News Today

August 30, 2011, at 11:40 am
by Jim Sinclair in the category In The News |  Print This Post |  Email This Post

There are two ways to conquer and enslave a nation. One is by the sword. The other is by debt. –John Adams, 1826


Jim Sinclair’s Commentary

September 7th takes on strategic importance.

Euro bail-out in doubt as ‘hysteria’ sweeps Germany
German Chancellor Angela Merkel no longer has enough coalition votes in the Bundestag to secure backing for Europe’s revamped rescue machinery, threatening a constitutional crisis in Germany and a fresh eruption of the euro debt saga. By Ambrose Evans-Pritchard
8:07PM BST 28 Aug 2011
Mrs Merkel has cancelled a high-profile trip to Russia on September 7, the crucial day when the package goes to the Bundestag and the country’s constitutional court rules on the legality of the EU’s bail-out machinery.
If the court rules that the €440bn rescue fund (EFSF) breaches Treaty law or undermines German fiscal sovereignty, it risks setting off an instant brushfire across monetary union.
The seething discontent in Germany over Europe’s debt crisis has spread to all the key institutions of the state. "Hysteria is sweeping Germany " said Klaus Regling, the EFSF’s director.
German media reported that the latest tally of votes in the Bundestag shows that 23 members from Mrs Merkel’s own coalition plan to vote against the package, including twelve of the 44 members of Bavaria’s Social Christians (CSU). This may force the Chancellor to rely on opposition votes, risking a government collapse.
Christian Wulff, Germany’s president, stunned the country last week by accusing the European Central Bank of going "far beyond its mandate" with mass purchases of Spanish and Italian debt, and warning that the Europe’s headlong rush towards fiscal union stikes at the "very core" of democracy. "Decisions have to be made in parliament in a liberal democracy. That is where legitimacy lies," he said.

More…

Jim’s Mailbox

August 30, 2011, at 11:39 am
by Jim Sinclair in the category Jim's Mailbox |  Print This Post |  Email This Post

Euro bail-out in doubt as ‘hysteria’ sweeps Germany  
CIGA Eric

A financial shock wave, originating in Europe, is heading for the United States. It’s only a matter of time. This is why bond shorts, while correct, cannot be early.
Headline: Euro bail-out in doubt as ‘hysteria’ sweeps Germany
Mrs Merkel has cancelled a high-profile trip to Russia on September 7, the crucial day when the package goes to the Bundestag and the country’s constitutional court rules on the legality of the EU’s bail-out machinery.
If the court rules that the €440bn rescue fund (EFSF) breaches Treaty law or undermines German fiscal sovereignty, it risks setting off an instant brushfire across monetary union.
The seething discontent in Germany over Europe’s debt crisis has spread to all the key institutions of the state. "Hysteria is sweeping Germany " said Klaus Regling, the EFSF’s director.
German media reported that the latest tally of votes in the Bundestag shows that 23 members from Mrs Merkel’s own coalition plan to vote against the package, including twelve of the 44 members of Bavaria’s Social Christians (CSU). This may force the Chancellor to rely on opposition votes, risking a government collapse.

Source: telegraph.co.uk

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Fed Needs More Easing Until Economy Grows: Evans  
CIGA Eric

I think the proper response from the urban dictionary would be no sh*t sherlock! The markets have been signaling this for months. Yet, many maintain that the Fed leads rather than follows them.
Headline: Fed Needs More Easing Until Economy Grows: Evans
The Federal Reserve may need to be even more aggressive in its easing policies than it has been so far unless the economy shows significant improvement, Chicago Fed President Charles Evans told CNBC.
A jobless rate at 9.1 percent is "consistent with recession" while inflation is far from a worry, Evans said while defending both the central bank’s previous actions to stimulate conditions and his view that even more action along the lines of quantitative easing [cnbc explains] will be needed.
In his view, QE needs to stay in place until unemployment plunges to 7 percent or if inflation gets past 3 percent. Core inflation, which strips out food and transportation, is about 1.8 percent, though the number is 3.6 percent including the more volatile measures.
Source: cnbc.com
More…