by Jeff Nielson, Bullion Bulls Canada:
Regular readers of my work know that I have been outlining (and warning people about) two potential economic scenarios;
as the West’s terminally-ill economies lurch towards their final
collapse. These hollowed-out, debt-saturated economies would (will)
either crash under the weight of their own insolvency; or our
governments will create a hyperinflation death-spiral — in a last
desperate attempt to avoid that bankruptcy event.While both paths represent utter, economic suicide; the road to ruin is much different in these two scenarios. This has severely limited the investment options and strategies for any prudent investor. Forced not only to “play defense” with our investing but to prepare for two more-or-less opposite events has made precious metals the one asset class which can protect investors from either of these fates.
I’ve explained on multiple occasions in the past why precious metals will outperform other asset classes in both a debt-default crash or hyperinflation-spiral scenario. The purpose of this piece is not to repeat that analysis, but rather to point out that as of this moment the “crash” scenario has become not only the most likely scenario, but an imminent event.
Read More @ BullionBullsCanada.com
Previewing Tomorrow's Payroll Report
The median estimate for tomorrow's all-important report is a +100k change in non-farm payrolls
(up from last month's +69k) with Stone & McCarthy topping the
table at +165k and Jason Schenker of Presitge Economics all
doom-and-gloom at +35k. Everyone's favorite
permabull-coz-of-QE3-advocate, Joe LaVorgna, is a more
negative-than-consensus +75k and Hatzius et al. at Goldman just notched
it up to +125k; but we focus on what Morgan Stanley's David Greenlaw
has to say as they appear to have the best handle on just how
significant an impact the weather has had on job growth data. Most
importantly, given the Fed's admitted focus on the labor market, this
is the last employment report before the End-of-July FOMC fireworks.
There is a chance that the FOMC could conceivably take further action at
the next meeting if Friday’s report is disappointing, but given that this is a divided FOMC which appears to be resigned to the status quo, the bar to such action seems relatively high at this point.The History Of The Federal Reserve System
For better or mostly worse, the Federal Reserve has been governing the monetary system of the United States since 1914. The visual history below
maps the rise of the Fed from its origins as a relatively minor
institution, often controlled by Presidents and The Treasury to its
supposedly independent and self-aware current position as, arguably,
the most powerful entity in the world. And because we always like to be
'fair-and-balanced' we juxtapose this clarifying truth of the maniacal growth of the Fed's balance sheet and shift from passive to hyperactive - highlighting every major macro-economic and political event on the way - with G. Edward Griffin's 1994 speech on 'The Creature From Jekyll Island'.Is Mario Draghi Lying Again?
The last time Mario Draghi made an unequivocal statement regarding his actions under exceptional circumstances, we pointed out the unthruthiness of his comment
that LTRO borrowing in no way stigmatized a bank. That did not end so
well for the LTRO banks. Today's ECB press conference perhaps sets him
up for another banana-skin down the road. From the 20 minute segment,
the ECB head describes the lowering of eligibility standards for ECB
collateral to include assets that banks take as collateral in the real
economy ("credit claims and ABS of lower rating", i.e. rusty old cars,
empty coffee-shops, unkempt holiday homes). He describes the hypothecated-hell: "It's
very useful [for the banks] to lend to the real economy; as the banks
generate collateral that they can now use for funding themselves"
- which sounds awfully like a ponzi scheme - is nothing less than a
massive on-boarding of all European asset risk by the ECB (using the
banks as a simple pass-thru). This would seem to dramatically lower the
quality of the ECB balance sheet. But have no fear, for as the new
maestro puts it "we want to do this in a way to keep the risks of the ECB balance sheet very very low". Low indeed.On The Morality Of Choice
Picture
yourself walking into a department store to purchase some laundry
detergent. As you approach the aisle stocked full of brightly-labeled
containers, you come face to face with a crucial decision. Which
detergent do you choose? Do you go with the tried-and-trusted brand?
Do you save money with the generic variety? What’s on sale? What about
the high-efficiency kind? The choice between something as inexpensive
as laundry detergent seems trivial in a modern economy marked by mass
production and the division of labor. But the large selection of goods
that consumers are faced with today is an incredible betterment
relative to the past thousand years of human existence. Indeed, the
lives of even the most impoverished in Western economies far surpasses
that of kings centuries ago. For all the condemnation it receives by
those considered on the forefront of intellectual thought, capitalism
is responsible for lifting mankind out of a dreary life of hand to
mouth survival. Economic freedom is ultimately to blame for the higher
standard of living the West enjoys compared to the once Communist
East. Material prosperity is a phenomenon not brought to the world by
governments but by entrepreneurial spirit. The state just is a
reactionary institution that derives its power from the gun it puts to
the back of public’s head. Those who succeed in the marketplace only
do so by appealing to consumers. Businessmen force no one to purchase
their wares less they play footsie with the political class for special
privilege. The pursuit of profit is what drives competition and
expanded choice. Without it, societal progress stagnates as living
standards lower.Barclays Wins Euromoney's Best Global Debt, Best Investment Bank, And Best Global Flow House Of The Year Awards
Financial magazine Euromoney, which in addition to being a subscription-based publication appears to also rely on bank advertising, has just held its 2012 Awards for Excellence dinner event. And in the "you can't make this up" category we have Barclays winning the Best Global Debt House, Best Investment Bank, And Best Global Flow House Of The Year Awards. Specifically we learn that "the bank’s commitment to the US is exemplified by the addition of another global senior manager to the country – Tom Kalaris is now going to be splitting his time between New York and London as executive chairman of the Americas as well as overseeing wealth management. Jerry del Missier, who has overseen the corporate and investment bank through its Lehman integration and was recently appointed COO of the Barclays group, says the bank is well positioned. "We came out of the crisis in a stronger strategic position and that has allowed us to continue to win market share and build our franchise. Keep in mind that the US is the largest investment banking, wealth management, credit card and investment management market in the world, and in terms of fee share will remain the most dynamic economy in the world for many years. As a strong global, universal bank operating in a competitive environment that is undergoing significant retrenchment, we like our position." That said, with the Chairman, CEO and COO all now fired, just who was it who accepted the various award: the firm's LIBOR setting team? And if so, were they drinking Bollinger at the dinner?Thunder Road Report On The Death March: Approaching A New Financial System
If
you are reading this, you are probably a member of what the
sociologists would term middle class (albeit at the upper end). This is
precisely the segment of society which is poised to come off worst from
what is coming. Here is a very disturbing idea. As this crisis
develops, if you are an equity portfolio manager and you want to
outperform the market, you are going to have to position your portfolio
so that it benefits most from your own wealth destruction and that of
your family, friends and colleagues. Almost everybody is going to lose
and there aren’t many places to hide. This is deeply unpleasant but
you can blame the central planners. I’ve written about my own
investing, e.g. gold and silver, equities in terms of Maslow’s
Hierarchy of Needs, etc. In this Thunder Road Report (below) and going
forward, I will discuss this middle class theme and highlight positions
I have in individual stocks, etc. The only good thing that can come
out of this is a rise in awareness. It’s just awful.Equities Fumble As Broke Banks Mounting
Volumes were not that far below average today as the Dow and the S&P (but not the miraculous NASDAAPL
- not that story again please!) ended the day lower after some
significant intraday volatility early (around the ECB/BoE decisions and
jobs/ISM data in the US). S&P 500 e-mini futures levitated off the
day's early lows to stabilize around VWAP before testing up to
unchanged and then losing it all into the close on heavy volume and
larger average trade size. Financials were the biggest losers, as the big banks dumped off most of their EU-Summit gains
(with JPM and MS down over 4% today), followed closely by Energy names -
even with WTI basically treading water close to close (despite some
+/-2% swings early on). USD strength saw Silver lagging on the day and
gold dropped a little but rather notably since the EU-Summit, gold and
the S&P have been trading more in lockstep (with Treasuries and the
USD pointing to more risk-off perspectives). Elsewhere in
commodity-land, corn continues its upsurge - now up 40% in the last 3 weeks.
After falling off the 1.25 cliff as Draghi disappointed, EURUSD
tracked sideways just under 1.2400 for the rest of the day; carry FX
pairs tended to drift lower most of the day but the afternoon was
quiet. Treasuries limped a little higher in yield into the close - led
by the long-end - but ended the day down a few bps from Tuesday's close
(with 7/10Y outperforming). Treasuries are unch from the last NFP report (as is EURUSD) while ES is 55pts higher - hhmm.
VIX ended the day up almost 1 vol accelerating above 17.5% as futures
dived after-hours and cross-asset class correlation remained relatively
low today - though ES traded with CONTEXT - as Europe's tensions were
once again shrugged off once it had closed and then remembered into the
US close.
from crabbydogtrix :
Gold Daily and Silver Weekly Charts - Metals Rigging Worse Than LIBOR
SP 500 and NDX Futures Daily Charts - the Muppets Are Restless
by Félix Moreno de la Cova, Gold Money:
The dream of developing a science that would allow wise philosopher
kings to rule humanity from ivory towers is as old as Plato, but it
received a significant boost during the 20th Century as “scientific”
socialism searched for the tools to replace the market economy and the
price system with a centrally planned “ideal” world. John Maynard
Keynes’ equation-rich General Theory of Employment, Interest and Money
gave many aspiring central planners what looked like the mathematical
tools to do so, and they rushed to build both statistical and mechanical
extensions that would bring practical policy applications to economic
theory. Unfortunately when logic is absent and the theoretical
foundations are a mish-mash of tautologies and fallacies, no amount of
adjusting parameters or clever computing can solve the underlying
flaws. The unseen hand of the market cannot be tamed.
Read More @ GoldMoney.com
The dream of developing a science that would allow wise philosopher
kings to rule humanity from ivory towers is as old as Plato, but it
received a significant boost during the 20th Century as “scientific”
socialism searched for the tools to replace the market economy and the
price system with a centrally planned “ideal” world. John Maynard
Keynes’ equation-rich General Theory of Employment, Interest and Money
gave many aspiring central planners what looked like the mathematical
tools to do so, and they rushed to build both statistical and mechanical
extensions that would bring practical policy applications to economic
theory. Unfortunately when logic is absent and the theoretical
foundations are a mish-mash of tautologies and fallacies, no amount of
adjusting parameters or clever computing can solve the underlying
flaws. The unseen hand of the market cannot be tamed.Read More @ GoldMoney.com
by Andrew Hoffman, MilesFranklin.com:
Amidst my pervasive “gloom and doom,” I like to mix in inspirational stories of the human condition – how individuals occasionally triumph over challenging obstacles, harrowing circumstances, or their own inner demons – per recent RANTS such as “AGT,” “INSPIRATION AND PERSEVERENCE,” AND “GERALD CELENTE, PATRIOT.” When I was a child, no show inspired me to succeed like Wide World of Sports; thus, to achieve the “thrill of victory,” and avoid the “agony of defeat”…
Three years ago, when the stock of the junior miner I worked for – and most of my mining investments – fell 80%, I saw the worst of humanity, first-hand. The cumulative human response to Global Meltdown I – particularly in my sector – was NOT to band together, but lash out, double-cross, and otherwise demonstrate how the “survival instinct” works, at the expense of ones’ fellow man.
Read more @ MilesFranklin.com
from Unconventional Finance:
from BrotherJohnf:
Amidst my pervasive “gloom and doom,” I like to mix in inspirational stories of the human condition – how individuals occasionally triumph over challenging obstacles, harrowing circumstances, or their own inner demons – per recent RANTS such as “AGT,” “INSPIRATION AND PERSEVERENCE,” AND “GERALD CELENTE, PATRIOT.” When I was a child, no show inspired me to succeed like Wide World of Sports; thus, to achieve the “thrill of victory,” and avoid the “agony of defeat”…Three years ago, when the stock of the junior miner I worked for – and most of my mining investments – fell 80%, I saw the worst of humanity, first-hand. The cumulative human response to Global Meltdown I – particularly in my sector – was NOT to band together, but lash out, double-cross, and otherwise demonstrate how the “survival instinct” works, at the expense of ones’ fellow man.
Read more @ MilesFranklin.com
from Unconventional Finance:
from BrotherJohnf:
by Philip Aldrick, The Telegraph:
The Bank of England switched on the printing presses with a third
round of quantitative easing, adding £50bn to the £325bn already
completed, while the European Central Bank (ECB) and China cut interest
rates.
China’s move, in particular, came as a shock. It was the second time in a month that Beijing had reduced rates, prompting speculation that the world’s second largest economy and engine of global growth could be stalling.
The interventions, which were not officially co-ordinated, came as Mario Draghi, the ECB president, confirmed that “some of the previously identified downside risks to euro area growth have materialised”, and the Bank warned that the crisis on the continent was eroding confidence in the UK.
Following the ECB action, the euro fell to close to a three-and-a-half year low against the pound.
The Organisation for Economic Co-operation & Development said global growth had picked up a little in the first quarter of the year, to 0.4pc from 0.3pc in the final quarter of 2011, but remained weak.
Read More @ Telegraph.co.uk
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from imitator777:
The Bank of England switched on the printing presses with a third
round of quantitative easing, adding £50bn to the £325bn already
completed, while the European Central Bank (ECB) and China cut interest
rates.China’s move, in particular, came as a shock. It was the second time in a month that Beijing had reduced rates, prompting speculation that the world’s second largest economy and engine of global growth could be stalling.
The interventions, which were not officially co-ordinated, came as Mario Draghi, the ECB president, confirmed that “some of the previously identified downside risks to euro area growth have materialised”, and the Bank warned that the crisis on the continent was eroding confidence in the UK.
Following the ECB action, the euro fell to close to a three-and-a-half year low against the pound.
The Organisation for Economic Co-operation & Development said global growth had picked up a little in the first quarter of the year, to 0.4pc from 0.3pc in the final quarter of 2011, but remained weak.
Read More @ Telegraph.co.uk
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from imitator777:
from RT:
On July 9, thousands of Internet users worldwide could lose access
after the FBI shuts down temporary DNS servers that replaced fraudulent
servers operated by hackers.
Major companies and US government agencies are amongst those that could be blocked out, according to the Internet security firm IID.
The blackout will affect systems infected with the DNSChanger Trojan, a malware program that altered user searches and redirected them to pages offering fraudulent and, in some cases, dangerous products.
Last November the FBI arrested and charged six Estonian men behind the malware as part of Operation Ghost Click. These hackers were able to make a fortune off their project, raking in millions for ads placed on their fraudulent websites.
On the eve of the arrests, the FBI hired Paul Vixie, chairman of the Internet Systems Consortium (ISC) to install two temporary Internet servers that would prevent infected users from losing access to the Internet once the DNSChanger botnet was shut down. These users were advised to take steps to get rid of the malware on their computers, and the DNSChanger Working Group was set up by the computer industry and law enforcement to come up with a plan to phase out the surrogate servers.
Read More @ RT.com
On July 9, thousands of Internet users worldwide could lose access
after the FBI shuts down temporary DNS servers that replaced fraudulent
servers operated by hackers.Major companies and US government agencies are amongst those that could be blocked out, according to the Internet security firm IID.
The blackout will affect systems infected with the DNSChanger Trojan, a malware program that altered user searches and redirected them to pages offering fraudulent and, in some cases, dangerous products.
Last November the FBI arrested and charged six Estonian men behind the malware as part of Operation Ghost Click. These hackers were able to make a fortune off their project, raking in millions for ads placed on their fraudulent websites.
On the eve of the arrests, the FBI hired Paul Vixie, chairman of the Internet Systems Consortium (ISC) to install two temporary Internet servers that would prevent infected users from losing access to the Internet once the DNSChanger botnet was shut down. These users were advised to take steps to get rid of the malware on their computers, and the DNSChanger Working Group was set up by the computer industry and law enforcement to come up with a plan to phase out the surrogate servers.
Read More @ RT.com
by George Ure, UrbanSurvival.com:
So another Fourth has come and gone – sunburns, the odd hangover,
stories to tell at work, and most people at this time of year can hardly
wait for the weekend to do more of the same. In some places, though,
the celebrations were a bit muted by the electrical problems from last
week’s storms. As CBS News put it, many Americans had to party like it was 1776.
Seems appropriate to think of this as recovery day in another vein, too: A commission report it out today and (you gotta love genius) it calls the Fukushima mess a man-made disaster. ISYN Gotta wonder how much help they needed figuring that out.
Free Money!
Well, almost, anyway: The European Central Bank has cut interest rates to a record low 0.75%. Sure makes it easy for the bankster class to refinance national debts cheaply and for the longer term, huh?
Read More @ UrbanSurvival.com
So another Fourth has come and gone – sunburns, the odd hangover,
stories to tell at work, and most people at this time of year can hardly
wait for the weekend to do more of the same. In some places, though,
the celebrations were a bit muted by the electrical problems from last
week’s storms. As CBS News put it, many Americans had to party like it was 1776.Seems appropriate to think of this as recovery day in another vein, too: A commission report it out today and (you gotta love genius) it calls the Fukushima mess a man-made disaster. ISYN Gotta wonder how much help they needed figuring that out.
Free Money!
Well, almost, anyway: The European Central Bank has cut interest rates to a record low 0.75%. Sure makes it easy for the bankster class to refinance national debts cheaply and for the longer term, huh?
Read More @ UrbanSurvival.com
by Kurt Nimmo, Info Wars:
United Nations apparatchiks are finalizing details on the Arms Trade
Treaty and the Obama administration is taking an active role. A treaty
conference commenced on July 3 at the United Nations and is scheduled to
run through July 27. Attendees will spend nearly a month tweaking a
treaty draft.
“Our common goal is clear: a robust and legally binding Arms Trade Treaty that will have a real impact on the lives of those millions of people suffering from the consequences of armed conflict, repression and armed violence,” said United Nations Secretary-General Ban Ki-Moon at the opening of the conference. “It is ambitious, but it is achievable.”
“The outcome will not seek to prohibit citizens of any country from possessing firearms or to interfere with the legal trade in small arms and light weapons,” a press release issued by the United Nations’ Office for Disarmament Affairs insists.
130 members of the House, however, are not convinced the treaty does not pose a threat to the Second Amendment. On June 29, they sent a letter to Obama and Secretary of State Clinton expressing concerns about the treaty.
Read More @ InfoWars.com
United Nations apparatchiks are finalizing details on the Arms Trade
Treaty and the Obama administration is taking an active role. A treaty
conference commenced on July 3 at the United Nations and is scheduled to
run through July 27. Attendees will spend nearly a month tweaking a
treaty draft.“Our common goal is clear: a robust and legally binding Arms Trade Treaty that will have a real impact on the lives of those millions of people suffering from the consequences of armed conflict, repression and armed violence,” said United Nations Secretary-General Ban Ki-Moon at the opening of the conference. “It is ambitious, but it is achievable.”
“The outcome will not seek to prohibit citizens of any country from possessing firearms or to interfere with the legal trade in small arms and light weapons,” a press release issued by the United Nations’ Office for Disarmament Affairs insists.
130 members of the House, however, are not convinced the treaty does not pose a threat to the Second Amendment. On June 29, they sent a letter to Obama and Secretary of State Clinton expressing concerns about the treaty.
Read More @ InfoWars.com
by Peter Schiff, Gold Seek:
In my latest book, The Real Crash: America’s Coming Bankruptcy – How to Save Yourself and Your Country,
I devote a full chapter to the merits of the historical gold standard
and reasons to reinstate it. What I did not mention and few investors
notice is that central banks are already returning to gold as the
ultimate safe haven asset.
I believe this change in policy, combined with continued inflation of Western currencies, is creating a stable floor for the gold price and an even brighter upside potential.
A Strategic Shift
The return to gold is unmistakably the product of a strategic, not merely a tactical, shift in global central banking policy. Central banks in the developed world have now altogether stopped selling bullion. This was foreshadowed by their behavior over the past decade, when they sold even less gold than they were permitted to under the anti-dumping Central Bank Gold Agreements. Clearly the concern about dumping gold was out of step with the trend. But more importantly, central banks in the emerging markets have been buying gold by the truckload.
Read More @ GoldSeek.com
In my latest book, The Real Crash: America’s Coming Bankruptcy – How to Save Yourself and Your Country,
I devote a full chapter to the merits of the historical gold standard
and reasons to reinstate it. What I did not mention and few investors
notice is that central banks are already returning to gold as the
ultimate safe haven asset.I believe this change in policy, combined with continued inflation of Western currencies, is creating a stable floor for the gold price and an even brighter upside potential.
A Strategic Shift
The return to gold is unmistakably the product of a strategic, not merely a tactical, shift in global central banking policy. Central banks in the developed world have now altogether stopped selling bullion. This was foreshadowed by their behavior over the past decade, when they sold even less gold than they were permitted to under the anti-dumping Central Bank Gold Agreements. Clearly the concern about dumping gold was out of step with the trend. But more importantly, central banks in the emerging markets have been buying gold by the truckload.
Read More @ GoldSeek.com
from KingWorldNews:
With continued volatility in key markets, including currencies, today
King World News interviewed acclaimed money manager Stephen Leeb,
Chairman & Chief Investment Officer of Leeb Capital Management, to
get his take on what is happening. Leeb spoke with KWN about the level
of fear and concern that is being expressed from older market veterans
that are extremely well connected. Here is what Leeb had to say about
what is taking place: “Byron Wien is really one of the deans of Wall
Street analysts. He’s been at this for over 40 years, and he has a
superb record. One of the features of his work each year is that he
interviews a man each year, who he refers to as, ‘The smartest man in
Europe.’”
“This man (Byron speaks with) is now in his eighties, and he has an amazing track record. This man has made a fortune. I paid very close attention to what this man’s comments were. He believes the debt levels of governments, in the developed world, we’re talking Europe and the US, means either depression or extreme stimulation, culminating in a lot of inflation.
Stephen Leeb continues @ KingWorldNews.com
With continued volatility in key markets, including currencies, today
King World News interviewed acclaimed money manager Stephen Leeb,
Chairman & Chief Investment Officer of Leeb Capital Management, to
get his take on what is happening. Leeb spoke with KWN about the level
of fear and concern that is being expressed from older market veterans
that are extremely well connected. Here is what Leeb had to say about
what is taking place: “Byron Wien is really one of the deans of Wall
Street analysts. He’s been at this for over 40 years, and he has a
superb record. One of the features of his work each year is that he
interviews a man each year, who he refers to as, ‘The smartest man in
Europe.’”“This man (Byron speaks with) is now in his eighties, and he has an amazing track record. This man has made a fortune. I paid very close attention to what this man’s comments were. He believes the debt levels of governments, in the developed world, we’re talking Europe and the US, means either depression or extreme stimulation, culminating in a lot of inflation.
Stephen Leeb continues @ KingWorldNews.com
from BenSwannRealityCheck:
Ben Swann Reality Check takes a look at the cost of America losing its founding principle of equal freedom.
Ben Swann Reality Check takes a look at the cost of America losing its founding principle of equal freedom.
by Charles Hugh Smith, Of Two Minds:
The Real-World Middle Class Tax Rate: 75%
If we include all taxes, the real-world tax rate is much higher than the “official” income tax rate.
For those Americans earning between $34,500 and $106,000, the real-world middle class tax burden in high-tax locales is 15% + 25% + 5% + 15% + 15% = 75%. Yes, 75%.
Before you start listing the innumerable caveats and quibbles raised by any discussion of taxes, please hear me out first. Let’s start by defining “taxes” as any fee that is mandated by law or legal necessity. In other words, taxes are what is not optional.
If we include all taxes, the real-world tax rate is much higher than the “official” income tax rate. These “other taxes” vary from nation to nation. France, for example, has a “television tax.” It is mandatory, and since virtually every household has a TV this operates as a universal tax. The argument that this is “optional” is specious.
In every other advanced democracy, basic universal healthcare is paid by tax revenues. In the U.S., healthcare insurance is “optional” but this too is specious: in the real world, private healthcare insurance is mandatory because the alternative–having zero insurance–places your entire net worth and income at risk of catastrophic loss.
Read More @ OfTwoMinds.com
The Real-World Middle Class Tax Rate: 75%If we include all taxes, the real-world tax rate is much higher than the “official” income tax rate.
For those Americans earning between $34,500 and $106,000, the real-world middle class tax burden in high-tax locales is 15% + 25% + 5% + 15% + 15% = 75%. Yes, 75%.
Before you start listing the innumerable caveats and quibbles raised by any discussion of taxes, please hear me out first. Let’s start by defining “taxes” as any fee that is mandated by law or legal necessity. In other words, taxes are what is not optional.
If we include all taxes, the real-world tax rate is much higher than the “official” income tax rate. These “other taxes” vary from nation to nation. France, for example, has a “television tax.” It is mandatory, and since virtually every household has a TV this operates as a universal tax. The argument that this is “optional” is specious.
In every other advanced democracy, basic universal healthcare is paid by tax revenues. In the U.S., healthcare insurance is “optional” but this too is specious: in the real world, private healthcare insurance is mandatory because the alternative–having zero insurance–places your entire net worth and income at risk of catastrophic loss.
Read More @ OfTwoMinds.com
from CapitalAccount:
Welcome to Capital Account. Central banks issue the command to keep the easy money flowing. The ECB cut its benchmark interest rate to a historic low, the Bank of England agreed to more QE, China’s central bank unveiled a surprise interest rate cut, and the Danish Central bank went one step further and entered NIRP territory, a negative interest rate policy. The US is under anesthesia already. Reggie Middleton will explain why no amount of money printing can create wealth.
And, just as people looked to the concept of a nuclear winter to ponder the cost of human destruction, is that what we are looking at when it comes to asset prices? Reggie Middleton, Entrepreneurial Investor and author of Boom Bust Blog, will explain why any amount of interest rate cutting or money printing cannot prevent a nuclear winter of real asset prices.
Also, former Barclays CEO Bob Diamond testified before members of British parliament over the LIBOR scandal. It has been deemed a preview of what may lie ahead for other big lenders under investigation. However, we will take a look back, as it seems the real pattern of repetition is collusion between authorities and the big banks.
Welcome to Capital Account. Central banks issue the command to keep the easy money flowing. The ECB cut its benchmark interest rate to a historic low, the Bank of England agreed to more QE, China’s central bank unveiled a surprise interest rate cut, and the Danish Central bank went one step further and entered NIRP territory, a negative interest rate policy. The US is under anesthesia already. Reggie Middleton will explain why no amount of money printing can create wealth.
And, just as people looked to the concept of a nuclear winter to ponder the cost of human destruction, is that what we are looking at when it comes to asset prices? Reggie Middleton, Entrepreneurial Investor and author of Boom Bust Blog, will explain why any amount of interest rate cutting or money printing cannot prevent a nuclear winter of real asset prices.
Also, former Barclays CEO Bob Diamond testified before members of British parliament over the LIBOR scandal. It has been deemed a preview of what may lie ahead for other big lenders under investigation. However, we will take a look back, as it seems the real pattern of repetition is collusion between authorities and the big banks.
by Eric Peters, Whiskey and Gunpowder:
Tomorrow – the Fourth of July – should be considered a national day of mourning.
Having affirmed the constitutionality of Obamacare – that is, of the federal government’s asserted authority not merely to force each of us to purchase the “services” of a private, government-backed cartel (the insurance mafia) but also implicitly its asserted authority over our very selves (because what could be more fundamental to “our health” than our selves?) — there is now no line the government may not, in principle (and so, inevitably, in practice) cross.
The gauntlet has been thrown down. The idea of the Constitution as a check on what the federal government may not do is as absurd as the Soviet Bill of Rights. There is nothing the federal government may not do. No area of our lives that remains off limits. Consider this as you celebrate your “freedoms” tomorrow… .
Just off the top of my head:
Mandatory life insurance – or else.
Why not? Does anyone imagine the life insurance mafia will not seize the opportunity created by what the health insurance mafia has just achieved? If the government can force us to buy health insurance – to hand over money to private, for-profit businesses on the basis of the idea that “everyone must be insured against risk because of the possibility that some people might transfer their costs onto ‘society’ ” – well, why not?
Read More @ WhiskeyAndGunpowder.com
by Michael Krieger, Liberty Blitzkreig
As someone who considers himself reasonably informed of the machinations of the criminal oligarchy running the United States of America these days, I am consistently surprised by how uninformed I still am in many ways. The case of ex-CIA agent John Kiriakou and the government’s witch hunt over his case is a perfect example.
One of the most disturbing yet encouraging things happening in America (and the world) today is the emergence of sophisticated and courageous whistleblowers and the subsequent attempts of the oligarchy to attack them and ruin their lives. Over a year ago, I wrote a piece about the soon to emerge whistleblowing theme titled The Whistleblower Trend has Begun: Next up Backstabbing.
The sad little criminals in power are understandably terrified of this trend and are using their old playbook methods to go after them, but they do not understand the hopelessness of these tactics. Social media, the internet and technology in general just make it too easy to leak stuff and expose criminality to hundreds of millions and soon to be billions of people in minutes. This trend cannot be stopped and is why TPTB and their minions will be swept away into the dustbin of history.
Read More @ LibertyBlitzkreig.com
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Tomorrow – the Fourth of July – should be considered a national day of mourning.Having affirmed the constitutionality of Obamacare – that is, of the federal government’s asserted authority not merely to force each of us to purchase the “services” of a private, government-backed cartel (the insurance mafia) but also implicitly its asserted authority over our very selves (because what could be more fundamental to “our health” than our selves?) — there is now no line the government may not, in principle (and so, inevitably, in practice) cross.
The gauntlet has been thrown down. The idea of the Constitution as a check on what the federal government may not do is as absurd as the Soviet Bill of Rights. There is nothing the federal government may not do. No area of our lives that remains off limits. Consider this as you celebrate your “freedoms” tomorrow… .
Just off the top of my head:
Mandatory life insurance – or else.
Why not? Does anyone imagine the life insurance mafia will not seize the opportunity created by what the health insurance mafia has just achieved? If the government can force us to buy health insurance – to hand over money to private, for-profit businesses on the basis of the idea that “everyone must be insured against risk because of the possibility that some people might transfer their costs onto ‘society’ ” – well, why not?
Read More @ WhiskeyAndGunpowder.com
As someone who considers himself reasonably informed of the machinations of the criminal oligarchy running the United States of America these days, I am consistently surprised by how uninformed I still am in many ways. The case of ex-CIA agent John Kiriakou and the government’s witch hunt over his case is a perfect example.
One of the most disturbing yet encouraging things happening in America (and the world) today is the emergence of sophisticated and courageous whistleblowers and the subsequent attempts of the oligarchy to attack them and ruin their lives. Over a year ago, I wrote a piece about the soon to emerge whistleblowing theme titled The Whistleblower Trend has Begun: Next up Backstabbing.
The sad little criminals in power are understandably terrified of this trend and are using their old playbook methods to go after them, but they do not understand the hopelessness of these tactics. Social media, the internet and technology in general just make it too easy to leak stuff and expose criminality to hundreds of millions and soon to be billions of people in minutes. This trend cannot be stopped and is why TPTB and their minions will be swept away into the dustbin of history.
Read More @ LibertyBlitzkreig.com
from KingWorldNews:
Today Egon von Greyerz gave King World News an extraordinary
interview. He pointed out that investors today are facing an Orwellian
type of propaganda as they are being bombard with massive misinformation
from the mainstream media. Egon von Greyerz, who is founder and
managing partner at Matterhorn Asset Management out of Switzerland, also
said investors, “…have to contend with governments which are attempting
to coverup the truth.” Here is what Greyerz had to say about the
ongoing financial crisis and where we are headed: “We have a mission,
and that mission is to help investors to stay safe through this
minefield of impending economic and financial disaster. I think that
sometimes investors get nervous because there is so much misinformation
coming from the mainstream media.”
“We also have to contend with governments which are attempting to coverup the truth. Therefore, it’s hard for most people to see what the truth is, and for investors to fully understand that we have this impending economic and financial disaster.
Egon von Greyerz continues @ KingWorldNews.com
Jim Sinclair’s Commentary
New York Times figures out that conspiracies really ARE rigging markets
Submitted by cpowell on 02:27AM ET Thursday, July 5, 2012.
Section: Daily Dispatches
It’s probably only another few decades now before the newspaper gets around to the gold and silver markets.
Rigged Rates, Rigged Markets From The New York Times
Tuesday, July 3, 2012
http://www.nytimes.com/2012/07/03/opinion/rigged-rates-rigged-markets.html
Marcus Agius, the chairman of Barclays, resigned on Monday, saying "the buck stops with me." His was the first departure since the British bank agreed last week to pay $450 million to settle findings that, from 2005 to 2009, it had tried to rig benchmark interest rates to benefit its own bottom line.
Mr. Agius was right to go and the bank’s chief executive, Robert Diamond Jr., should follow him out the door. But the investigations cannot stop there.
The rates in question — the London interbank offered rate, or Libor, and the Euro interbank offered rate, or Euribor — are used to determine the borrowing rates for consumers and companies, including some $10 trillion in mortgages, student loans, and credit cards. The rates are also linked to an estimated $700 trillion market in derivatives, which banks buy and sell on a daily basis. If these rates are rigged, markets are rigged — against bank customers, like everyday borrowers, and against parties on the other side of a bank’s derivatives deals, like pension funds.
… Dispatch continues below …
________________________________________
Barclays is only one of more than a dozen big banks that provide information used to set the daily rate for Libor and Euribor. The settlement, struck with regulators in Washington and London and with the Department of Justice, indicates that the bank did not act alone. It shows that unnamed managers and traders of Barclays in London, New York, and Tokyo colluded with or prevailed upon bank employees who provide the benchmark data to make false reports. The aim was to bolster Barclays’ trading positions and to aid or counteract other banks’ attempts at manipulation.
The evidence, cited by the Justice Department — which Barclays agreed is "true and accurate" — is damning. "Always happy to help," one employee wrote in an e-mail after being asked to submit false information. "If you know how to keep a secret, I’ll bring you in on it," wrote a Barclays trader to a trader at another bank, referring to an attempt to align their strategies for mutual gain.
If that’s not conspiracy and price-fixing, what is?
The Justice Department has left open the possibility of prosecuting officers or employees of Barclays. But it has agreed not to prosecute the bank itself, in part because Barclays was the first to cooperate in the investigation and has agreed to keep cooperating. Such an agreement makes sense only if that cooperation will allow prosecutors to nail other banks that have been involved in setting the rates, including potential cases against Citigroup, JPMorgan Chase, and HSBC, and people who work there.
To date, the Justice Department has not distinguished itself in prosecuting major banks or their executives for conduct leading up to and during the financial crisis. But with Barclays now cooperating, the "Libor scandal" is another chance for government prosecutors to unmask and punish financial wrongdoing.
www.gata.org
Jim Sinclair’s Commentary
BoE Prints Money Again to Boost to UK Economy Published: Thursday, 5 Jul 2012 | 7:47 AM ET
The Bank of England launched a third round of monetary stimulus on Thursday, announcing it would restart its printing presses and buy 50 billion pounds ($78 billion) of asset purchases with newly created money to help the economy out of recession.
The move was widely expected after BoE Governor Mervyn King said last month the economic outlook had deteriorated since the BoE called a halt to its second round of asset purchases – also known as quantitative easing – in May.
"Against the background of continuing tight credit conditions and fiscal consolidation, the increased drag from the heightened tensions within the euro area meant that, without additional monetary stimulus, it was more likely than not that inflation would undershoot the target in the medium term," the BoE said in a statement.
The BoE has bought 325 billion pounds of government bonds to date, and the purchases announced on Thursday take this total to 375 billion.
They will be spread over four months – longer than many economists expected, and a minority had expected the BoE to conduct 75 billion pounds of purchases.
Gilt futures – which had rallied in the run-up to the decision – fell by more than 30 ticks to hit a session low after the data. Sterling rose versus the dollar.
More…
Jim Sinclair’s Commentary
Jim Sinclair’s Commentary
Investment Outlook, July 2012
What’s In A Name? by William H. Gross, PIMCO
Not only banks and insurance companies but sovereign nations as well cannot all be counted on to guarantee a return of principal, let alone a return on investment.
An authentic debt crisis – which the world is now experiencing – can only be ultimately cured in two ways: 1) default on it, or 2) print more money in order to inflate it away.
There are very few clean dirty shirts in this world. Timing in investment markets is critical and at the moment the U.S. is considered to be the cleanest.
What’s in a name? I wish I’d asked my parents how they came up with mine, because I’ve never really been a good “Bill.” That is not to say that I’m uncomfortable in my own skin – I usually am – but I’ve never really been at ease with the name. Perhaps it’s genetic because the discomfort seems to run in the family. Who could blame my father I suppose for insisting on “Dutch” as opposed to Sewell Gross the IV! Imagine: a nameological tyranny of four successive Sewells! It ended with him, but then there was my brother Craig who insisted on Chip and my sister Lynn who in her fifties changed her name to Lyn. At least I didn’t have to worry about calling her by the wrong name, although I have boo-booed on birthday cards. In any case, we Grosses seem to dislike our names.
Having kids, however, allowed me to set the record straight or at least mutate those genes which kept rejecting given names that seemed appropriate to parents, but not to Gross progeny. My first attempt at cracking the code came with my first son, Jeff. I liked “Jeff.” It was short, masculine and was the first name of a Duke basketball star in the 1960s. I’d be a better Jeff than a Bill. Next up was Jennifer, whose name came from a Donovan number one hit song and then there was Nick. Nick was actually Sue’s favorite name, but I easily conceded. Who couldn’t like Nick? Saint Nick, just in the Nick of time, Nick, Nick, Nick. I would’ve been a good Nick.
More…
Jim Sinclair’s Commentary
The Largest Banking Scandal of the 21st Century Christopher Barker – July 4, 2012
Although the century is still young, this is shaping up to be the banking scandal of the century thus far.
On the heels of last week’s announcement that British bank Barclays will fork over $450 million in penalties to U.S. and British authorities for manipulating the interest rates at which banks lend to each other (known as LIBOR for U.S. dollar lending, and EURIBOR for euro-denominated debt), the scope of the scandal continues to grow. Further news of a pending $233 million penalty against Royal Bank of Scotland — which is 82% government-owned after that institution’s quasi-nationalization — comes as a particularly painful twist for British taxpayers.
But it would be a major mistake to view this emerging scandal as a British affair. Both Citigroup (NYSE: C ) and Swiss bank UBS (NYSE: UBS ) join London-based giant HSBC Holdings (NYSE: HBC ) among those explicitly implicated by U.K. Chancellor of the Exchequer George Osborne. U.K. periodical Daily Mail reports the list may grow to more than 20 banks involved in these efforts to rig the LIBOR and EURIBOR rates, and it lists JPMorgan Chase (NYSE: JPM ) , Germany’s Deutsche Bank (NYSE: DB ) , and Japan’s Bank of Tokyo Mitsubishi among "others under scrutiny."
This is a global banking scandal, with potential victims equally widespread. Providing context for the $160 million penalty assessed to Barclays by the U.S. Department of Justice last week, Assistant Attorney General Lanny Breuer explained: "Because mortgages, student loans, financial derivatives, and other financial products rely on LIBOR and EURIBOR as reference rates, the manipulation of submissions used to calculate those rates can have significant negative effects on consumers and financial markets worldwide." Rolling Stone reporter Matt Taibbi reminds us that "almost every city and town in America has investment holdings tied to Libor."
More…
Today Egon von Greyerz gave King World News an extraordinary
interview. He pointed out that investors today are facing an Orwellian
type of propaganda as they are being bombard with massive misinformation
from the mainstream media. Egon von Greyerz, who is founder and
managing partner at Matterhorn Asset Management out of Switzerland, also
said investors, “…have to contend with governments which are attempting
to coverup the truth.” Here is what Greyerz had to say about the
ongoing financial crisis and where we are headed: “We have a mission,
and that mission is to help investors to stay safe through this
minefield of impending economic and financial disaster. I think that
sometimes investors get nervous because there is so much misinformation
coming from the mainstream media.”“We also have to contend with governments which are attempting to coverup the truth. Therefore, it’s hard for most people to see what the truth is, and for investors to fully understand that we have this impending economic and financial disaster.
Egon von Greyerz continues @ KingWorldNews.com
Jim Sinclair’s Commentary
People are starting to understand what happened.
New York Times figures out that conspiracies really ARE rigging markets
Submitted by cpowell on 02:27AM ET Thursday, July 5, 2012.
Section: Daily Dispatches
It’s probably only another few decades now before the newspaper gets around to the gold and silver markets.
Rigged Rates, Rigged Markets From The New York Times
Tuesday, July 3, 2012
http://www.nytimes.com/2012/07/03/opinion/rigged-rates-rigged-markets.html
Marcus Agius, the chairman of Barclays, resigned on Monday, saying "the buck stops with me." His was the first departure since the British bank agreed last week to pay $450 million to settle findings that, from 2005 to 2009, it had tried to rig benchmark interest rates to benefit its own bottom line.
Mr. Agius was right to go and the bank’s chief executive, Robert Diamond Jr., should follow him out the door. But the investigations cannot stop there.
The rates in question — the London interbank offered rate, or Libor, and the Euro interbank offered rate, or Euribor — are used to determine the borrowing rates for consumers and companies, including some $10 trillion in mortgages, student loans, and credit cards. The rates are also linked to an estimated $700 trillion market in derivatives, which banks buy and sell on a daily basis. If these rates are rigged, markets are rigged — against bank customers, like everyday borrowers, and against parties on the other side of a bank’s derivatives deals, like pension funds.
… Dispatch continues below …
________________________________________
Barclays is only one of more than a dozen big banks that provide information used to set the daily rate for Libor and Euribor. The settlement, struck with regulators in Washington and London and with the Department of Justice, indicates that the bank did not act alone. It shows that unnamed managers and traders of Barclays in London, New York, and Tokyo colluded with or prevailed upon bank employees who provide the benchmark data to make false reports. The aim was to bolster Barclays’ trading positions and to aid or counteract other banks’ attempts at manipulation.
The evidence, cited by the Justice Department — which Barclays agreed is "true and accurate" — is damning. "Always happy to help," one employee wrote in an e-mail after being asked to submit false information. "If you know how to keep a secret, I’ll bring you in on it," wrote a Barclays trader to a trader at another bank, referring to an attempt to align their strategies for mutual gain.
If that’s not conspiracy and price-fixing, what is?
The Justice Department has left open the possibility of prosecuting officers or employees of Barclays. But it has agreed not to prosecute the bank itself, in part because Barclays was the first to cooperate in the investigation and has agreed to keep cooperating. Such an agreement makes sense only if that cooperation will allow prosecutors to nail other banks that have been involved in setting the rates, including potential cases against Citigroup, JPMorgan Chase, and HSBC, and people who work there.
To date, the Justice Department has not distinguished itself in prosecuting major banks or their executives for conduct leading up to and during the financial crisis. But with Barclays now cooperating, the "Libor scandal" is another chance for government prosecutors to unmask and punish financial wrongdoing.
www.gata.org
Jim Sinclair’s Commentary
Whatever is required here and there will be provided by QE.
BoE Prints Money Again to Boost to UK Economy Published: Thursday, 5 Jul 2012 | 7:47 AM ET
The Bank of England launched a third round of monetary stimulus on Thursday, announcing it would restart its printing presses and buy 50 billion pounds ($78 billion) of asset purchases with newly created money to help the economy out of recession.
The move was widely expected after BoE Governor Mervyn King said last month the economic outlook had deteriorated since the BoE called a halt to its second round of asset purchases – also known as quantitative easing – in May.
"Against the background of continuing tight credit conditions and fiscal consolidation, the increased drag from the heightened tensions within the euro area meant that, without additional monetary stimulus, it was more likely than not that inflation would undershoot the target in the medium term," the BoE said in a statement.
The BoE has bought 325 billion pounds of government bonds to date, and the purchases announced on Thursday take this total to 375 billion.
They will be spread over four months – longer than many economists expected, and a minority had expected the BoE to conduct 75 billion pounds of purchases.
Gilt futures – which had rallied in the run-up to the decision – fell by more than 30 ticks to hit a session low after the data. Sterling rose versus the dollar.
More…
Jim Sinclair’s Commentary
For those of you succumbing to the deflationist anti gold argument, please give this Bloomberg interview serious consideration.
Click here to watch the interview…Jim Sinclair’s Commentary
QE to infinity is the only can kick that politicians have access to,
therefore it is inevitable that it will without any doubt whatsoever
occur here and there.
Investment Outlook, July 2012
What’s In A Name? by William H. Gross, PIMCO
Not only banks and insurance companies but sovereign nations as well cannot all be counted on to guarantee a return of principal, let alone a return on investment.
An authentic debt crisis – which the world is now experiencing – can only be ultimately cured in two ways: 1) default on it, or 2) print more money in order to inflate it away.
There are very few clean dirty shirts in this world. Timing in investment markets is critical and at the moment the U.S. is considered to be the cleanest.
What’s in a name? I wish I’d asked my parents how they came up with mine, because I’ve never really been a good “Bill.” That is not to say that I’m uncomfortable in my own skin – I usually am – but I’ve never really been at ease with the name. Perhaps it’s genetic because the discomfort seems to run in the family. Who could blame my father I suppose for insisting on “Dutch” as opposed to Sewell Gross the IV! Imagine: a nameological tyranny of four successive Sewells! It ended with him, but then there was my brother Craig who insisted on Chip and my sister Lynn who in her fifties changed her name to Lyn. At least I didn’t have to worry about calling her by the wrong name, although I have boo-booed on birthday cards. In any case, we Grosses seem to dislike our names.
Having kids, however, allowed me to set the record straight or at least mutate those genes which kept rejecting given names that seemed appropriate to parents, but not to Gross progeny. My first attempt at cracking the code came with my first son, Jeff. I liked “Jeff.” It was short, masculine and was the first name of a Duke basketball star in the 1960s. I’d be a better Jeff than a Bill. Next up was Jennifer, whose name came from a Donovan number one hit song and then there was Nick. Nick was actually Sue’s favorite name, but I easily conceded. Who couldn’t like Nick? Saint Nick, just in the Nick of time, Nick, Nick, Nick. I would’ve been a good Nick.
More…
Jim Sinclair’s Commentary
What Barclays did for central banks (plural) was to actually say
there was a Libor under 7% at the height of the crisis in the end of
2008 to the first quarter of 2009.
At the peak of that crisis banks would not lend to banks, therefore in fact Libor did not even exist.
There are problems within the Banksters fraternity. MSM and MOPE keep
North America dumbed down but that does not make anything go away.
The Largest Banking Scandal of the 21st Century Christopher Barker – July 4, 2012
Although the century is still young, this is shaping up to be the banking scandal of the century thus far.
On the heels of last week’s announcement that British bank Barclays will fork over $450 million in penalties to U.S. and British authorities for manipulating the interest rates at which banks lend to each other (known as LIBOR for U.S. dollar lending, and EURIBOR for euro-denominated debt), the scope of the scandal continues to grow. Further news of a pending $233 million penalty against Royal Bank of Scotland — which is 82% government-owned after that institution’s quasi-nationalization — comes as a particularly painful twist for British taxpayers.
But it would be a major mistake to view this emerging scandal as a British affair. Both Citigroup (NYSE: C ) and Swiss bank UBS (NYSE: UBS ) join London-based giant HSBC Holdings (NYSE: HBC ) among those explicitly implicated by U.K. Chancellor of the Exchequer George Osborne. U.K. periodical Daily Mail reports the list may grow to more than 20 banks involved in these efforts to rig the LIBOR and EURIBOR rates, and it lists JPMorgan Chase (NYSE: JPM ) , Germany’s Deutsche Bank (NYSE: DB ) , and Japan’s Bank of Tokyo Mitsubishi among "others under scrutiny."
This is a global banking scandal, with potential victims equally widespread. Providing context for the $160 million penalty assessed to Barclays by the U.S. Department of Justice last week, Assistant Attorney General Lanny Breuer explained: "Because mortgages, student loans, financial derivatives, and other financial products rely on LIBOR and EURIBOR as reference rates, the manipulation of submissions used to calculate those rates can have significant negative effects on consumers and financial markets worldwide." Rolling Stone reporter Matt Taibbi reminds us that "almost every city and town in America has investment holdings tied to Libor."
More…
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