Wall Street Warns Tim Geithner That The Dollar Is Starting To Lose Its Reserve Status

The Treasury's Borrowing Advisory Committee, chaired by such luminaries as JPMorgan and Goldman Sachs, which according to some (and by some we mean anyone who cares about such things) is the brains behind the decision-making process of US debt issuance has released its quarterly minutes, in which it has issued one of the most stark warnings about the fate of the US Dollar to date. While it is now a daily occurrence for China and Russia to bash the dollar, for the most part still powerless to provide an alternative (but rapidly gaining), the same warning coming from Jamie and Lloyd has to be taken far, far more seriously. Which is precisely what happened today. As Bloomberg reports, "The Treasury Borrowing Advisory Committee... said the outperformance of haven currencies and those from emerging nations has aided in the debasement of the dollar’s reserve status, according to comments included in discussion charts presented ahead of the quarterly refunding. The Treasury published the documents today. “The idea of a reserve currency is that it is built on strength, not typically that it is ‘best among poor choices’,” page 35 of the presentation made by one committee member said. “The fact that there are not currently viable alternatives to the U.S. dollar is a hollow victory and perhaps portends a deteriorating fate.”"

 

 

Doug Casey- inflation to hit 20-40%, savers wiped out...That would be you...

“Inflation in the next few years is likely to start running ahead at 20% or 30% or even 40% per year or more and that’s going to devastate the prudent people in this country and perversely it’s going to reward the imprudent ones, the grasshoppers in our society that are deeply in debt because it will wipe their debt out. This is all quite perverse, very bad."

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Two Major Chapters In Growth Of Gold To Reserve Currency Complete

August 3, 2011, at 12:26 pm
by Jim Sinclair 

My Dear Friends,

I am on the road again. This time it is to speak at the GATA conference in London Friday afternoon.
The key concept in the gold market is that it has in no way performed like a classic blow-off hyperbolic top.
The price travel between $1600 and $1764 is fraught with points of resistance. The price journey in the next chapter founded by the fundamental reasons by Alf Fields and Martin Armstrong will soon be shown as correct. They will be the predictors of merit.
There is no reason to drop or reduce your gold hedges.
There is as always good reason not to carry any margin in a protective gold spread. Gold will only gain in volatility that will frustrate the greed driven mad margin trader.
Two major chapters in the growth of gold to reserve currency of the people’s choice are completed.
The last chapter is still coming going into 2015 and will be spectacular.
I will be in touch with you from the airport and hotel. I hope to see you at the conference.
Respectfully,
Jim

Jim’s Mailbox

August 3, 2011, at 12:25 pm
by Jim Sinclair in the category Jim's Mailbox |  Print This Post |  Email This Post

 

U.S. Economy Running at ‘Stall Speed’ 

CIGA Eric

How many readers recall the vast array of headlines and talking head analysis intended to convince the investment world that another installment of QE wasn’t necessary? I’d say unless you’re related to Dory from Finding Nemo (2003) it should be everyone. It’s not denoted QE(n) because I have a thing for subscripts.
Headline: U.S. Economy Running at ‘Stall Speed’
Pacific Investment Management Co. and BlackRock Inc., which together oversee almost $5 trillion, say the U.S. economy is stalling.
Bill Gross, who runs the world’s biggest bond fund at Pimco, and Peter Fisher, head of fixed income at BlackRock, say the Federal Reserve is preparing measures to counter the slowdown.
“We’re not looking at a recession yet, but we’re at a tipping point,” Gross said yesterday in an interview on Bloomberg Television. “We’re at what we call a stall speed in which corporate profits don’t grow, jobs aren’t created,” said Gross, who is based in Newport Beach, California.
Source: finance.yahoo.com
More…

Investors Withdraw Most From Domestic Equities Since The Flash Crash

The ICI fund flow data is out and it is ugly: in the past week, investors pulled money from every single strategy for a total outflow of $10.4 billion. As usual the biggest drop was in domestic equities, which saw $8.76 billion in withdrawals, the largest since the Flash Crash when investors yanked $13.4 billion. This is the 15th consecutive week of outflows, and brings the year's total cumulative outflow to $50 billion. Add to this the $98 billion in withdrawals in 2010 and one can see why the mutual fund ponzi, which is already facing record low cash levels, is desperately relying on further stock appreciation as any additional capital withdrawals will result in a toxic downward spiral of selling. Because should the cash balance of about 3% of assets be used up, there will be no other way to satisfy redemption requests than with accelerated selling. In other news, taxable bond funds saw $67 million in withdrawals, a very rare outflow from fixed income, while muni funds saw $147 million in outflows.

JP Morgan Cuts Q3 GDP To 1.5% From 2.5%, Sees Unemployment Rate At 8.9% By End Of 2012

Yesterday, JPM's Michael Feroli who is now undisputedly the least worst Wall Street economist (RIP Hatzius) cut his 2012 GDP forecast to under 1% net of fiscal adjustments. As of minutes ago, he just slashed his Q3 GDP from 2.5% to 1.5%. And the worst news for Obama: he will be dealing with 8.9% unemployment during his re-election campaign, which can now Rest in Peace. Speaking of RIPs, here's to you growth Hockeystick. You will be fondly forgotten.

Guest Post: Some Of The Many Things You Would Love About This Place

As is typical for me, I woke up this morning with the sun shining in my face from the east-facing window of my apartment here in Vilnius. It’s a really spectacular place– 2 bedrooms, around 1,000 square feet, and generously decorated with a lot of elegant finishings. From here, I’m about 2 blocks from the main square– an excellent location. But the best part is the price. This luxurious penthouse is setting me back a  whopping 49 euros per night– that’s around $70 USD. This is reflective of Lithuania’s substantially lower cost of living, especially compared to the rest of Europe. For example, I spent about $100 at the grocery store for a week’s worth of food last night, most of it organic… and locally produced.  Lithuania is also a very cost effective choice for business owners. The labor pool is quite inexpensive– you can hire a university educated, trilingual employee who speaks English and Russian in addition to Lithuanian, for $800 to $1,200 per month. Personal and corporate tax rates here are also very low, a hallmark of the Baltic economies. And one of the secrets of this place is that you can actually be granted residency in Lithuania simply by forming a local company.





Fukushima Radiation Highest Ever, Exceeding Capacity of Measuring Device ... Fuel Likely Leaking Out Of Containment Vessel

Posted by : George Washington

Post date: 08/03/2011 - 14:58

Things are - literally - heating up again at Fukushima ... 

 

 

 

 

 

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