Why China Is Dumping The Dollar - And Why You Should Read Up on the Weimar Republic

Posted by: CrownThomas

Post date: 03/10/2012 - 20:47

China is trying to tell you something, are you listening?

Weimar hyperinflation "When Money Dies" PDF file

Europe's Scariest Chart Just Got Scarier

The last time we plotted European youth unemployment in what was dubbed "Europe's scariest chart" we were surprised to discover that when it comes to "Arab Spring inspiring" youth unemployment, Spain was actually worse off than even (now officially broke) Greece, whose young adult unemployment at the time was only just better compared to that... of the United States. Luckily, following the latest economic (yes, we laughed too) update from Greece, it is safe to say that things are back to normal, as Greek youth unemployment is officially the second one in Europe after Spain to surpass 50%. In other words, Europe's scariest chart just got even scarier.

CDS As Insurance Contracts

While AIG FP often made the contracts look like insurance products, the banks were very careful to make sure that the products were “credit derivatives” because they needed the regulatory capital relief provided by them.  Didn’t the Fed at some point get concerned about the counterparty exposure to AIG FP?  Isn’t counterparty risk something that the Fed is responsible for monitoring (or the ECB in the case of foreign banks)?  When the Fed let MS and GS become bank holding companies and get the ability to use Fed lending programs, didn’t they ask about the AIG FP exposure?  Goldman, which always claimed it was hedged, must have had a massive short position in AIG CDS to be hedged – again, no one at the Fed noticed this?  CDS may be unregulated, but when virtually every big financial company in the world has large notionals on with AIG, huge mark to market gains on those positions, no collateral from AIG, and big shorts in AIG CDS, couldn’t someone do their job?   This should have been noticeable in 2007!

The Fed's Manipulation Of The Market Is Driving TrimTabs' Charles Biderman "Even More Nuts Than He Already Is"

Back in 2009 and 2010, TrimTabs Charles Biderman made waves for being the first person on prime time financial TV to tell it how it is, namely that the Fed is indirectly and directly affecting asset prices. Then he was ostracized. Now, it is not only a given that the Fed does everything in its power to hike stock prices, but is in fact welcome. Indeed, none other than Bob Pisani made point of highlighting that between central bank intervention and kicking the can down the road, the status quo has managed to restore credibility in the system. Of course, nothing could be further from the truth, as we have demonstrated with the now terminal evacuation of faith by the retail investor in the gross manipulated stock "market" which is nothing but a nominal policy vehicle for politicians and bankers. Unfortunately, the endless lies and propaganda are starting to push rational people who refuse to take the blue pill, and who are fully aware there is no wizard, over the edge. In his latest videoblog, Biderman is back, taking his Lewis Black impersonation to the next level, with the following rant: "Individuals are net sellers of US equities and have been for years, probably because they need to pay bills and stuff. So how are they able to do that and get decent prices without the stock market cracking. Well simple the Federal Reserve has been printing huge amounts of money and that ultimately has been boosting the value of US equities, and therefore the sellers can sell. All of this is driving me even more nuts than I already am."

(Click on image to enlarge)

(Click on image to enlarge)

 

The Black Swan NO ONE is Talking About: Germany’s “Plan B” 

Posted by: Phoenix Capital...

Post date: 03/10/2012 - 20:53

Germany just launched a €480 billion fund that it will use to backstop its banking system should a Crisis hit. And in the fine print, which no one has caught,... the fund will also allow...

 

 

China Posts Biggest Trade Deficit Since 1989 As Crude Imports Surge: Is China Recycling Export Dollars Solely Into Oil?

In addition to all the US election year propaganda and delayed after effects of central banks injecting nearly $3 trillion in liquidity to juice up the US stock market, something far more notable yet underreported has happened in 2012: the world stopped exporting. Observe the following sequence of very recent headlines: "Japan trade deficit hits record", "Australia Records First Trade Deficit in 11 Months on 8% Plunge in Exports", "Brazil Posts First Monthly Trade Deficit in 12 Months " then of course this: "[US] Trade deficit hits 3-year record imbalance", and finally, as of late last night, we get the following stunning headline: "China Has Biggest Trade Shortfall Since 1989 on Europe Turmoil." Here we must apologize, but blaming the highest trade deficit in 23 years for a country that needs a trade surplus to exist, on the Chinese Lunar new year, which accidentally happens every year, is more than a little naive. Because as the charts below indicate, while exports did in fact tumble in a seasonal pattern as they do every February although more than expected, February imports of $146 billion not only did not drop, but posted a 19% increase compared to January, and soared 40% compared to a year prior. Why? Perhaps the second consecutive record high in monthly crude imports has something to do with it. Which in turn when considering the huge selloff of US Treasury paper by China in the last few months, indicates that the world's fastest growing economy no longer has an interest in taking its export dollars and using them to fund purchases of US paper, but is in fact converting US fiat into real, hard goods. Such as crude (for all those curious where the marginal demand is coming from that is). And most likely gold. But we will only learn about the gold hoarding well after the fact, when China is prepared to see the price of the metal soar as it did in 2009.




70% of all Ground Beef Contains "Pink Slime" ... and USDA Bought 7 Million Pounds of the Stuff for School Lunches    






Take a look at this 485-pound behemoth:

This $12.8 million giant currently sits in a gold museum in Taiwan.

But due to expected demand in rising gold prices, it could soon be worth even more...

Upwards of $19.4 million.

Swiss bank UBS — the most accurate gold analyst for the past three years — expects gold to peak at $2,500 this year.

(Ed note...If you have this much Gold...or Silver...Please consider supporting our efforts to keep you informed...)

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