The warning signs are getting worse
from FinancialSense.com:
Jim
welcomes back John Williams from Shadow Government Statistics. John
sees no way to avoid hyperinflation, as some of the warning signs are
getting worse: rising real inflation rates, massive Fed monetization,
foreign nations dumping dollars, and the US losing its triple A credit
rating.John received an A.B. in Economics, cum laude, from Dartmouth College in 1971, and was awarded a M.B.A. from Dartmouth’s Amos Tuck School of Business Administration in 1972, where he was named an Edward Tuck Scholar. During his career as a consulting economist, John has worked with individuals as well as Fortune 500 companies. Formally known as Walter J. Williams, his friends call him John. For nearly 30 years, John has been a private consulting economist and, out of necessity, had to become a specialist in government economic reporting.
Click Here to Listen to the Interview
from King World News:
The
mainstream media has been bombarding people with conflicting reports
about what is supposedly taking place in the economy and inflation, so
KWN wanted to let its readers know what is really happening. For that
we turned to John Williams, of Shadowstats, who summed up the economic
and inflation situation beautifully in his latest commentary. He also
related inflation data to future possibilities with regards to gold and
silver pricing: “Although the Bureau of Economic Analysis (BEA) reports
that general business activity in the United States has recovered its
pre-recession levels, no major independent economic series confirms that
circumstance. Only the BEA’s overstated and heavily-politicized gross
domestic product (GDP) measure makes that claim.”
John Williams continues: Read More @ KingWorldNews.com
The
mainstream media has been bombarding people with conflicting reports
about what is supposedly taking place in the economy and inflation, so
KWN wanted to let its readers know what is really happening. For that
we turned to John Williams, of Shadowstats, who summed up the economic
and inflation situation beautifully in his latest commentary. He also
related inflation data to future possibilities with regards to gold and
silver pricing: “Although the Bureau of Economic Analysis (BEA) reports
that general business activity in the United States has recovered its
pre-recession levels, no major independent economic series confirms that
circumstance. Only the BEA’s overstated and heavily-politicized gross
domestic product (GDP) measure makes that claim.”John Williams continues: Read More @ KingWorldNews.com
by Peter Krauth, MineWeb.com:
It’s the beginning of a new year, and there’s no shortage of big headlines…
Europe is on the financial brink, Iran is a powder keg, and precious metals like gold have retreated.
It’s also a time when there is no shortage of financial forecasts.
Even though these kinds of predictions about the future can be tough to make, I’ll admit it’s kind of fun to look forward and see what the future may hold.
Read More @ MineWeb.com
From US Treasury Bonds To Global Equities, Says The Market
Eric De Groot at Eric De Groot - 9 minutes ago
Capital is reallocating from US Treasury bonds (public sector assets) to global equities (private sector assets). Emotional dependency on short-term volatility, however, prevents early recognition of this shift by most investors. Adding insult to injury, denial about the death of an old trading paradigm, often supported and repeated by headline chatter, ensures late entry for most. Large Cap... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]
by Brittany Stepniak, WealthWire.com:
In order to stimulate our economy, it sounds like the Fed plans to pump-it-up with a $1 trillion easing project.
And it could happen as early as this month…
CNBC reports:
The aim of those purchases will be to push interest rates even further and to indirectly induce confidence that there are more “monetary tools” that can revive the economy.
Read More (and Watch the Video) @ WealthWire.com
When Morgan Stanley now agrees with most of what Zero Hedge has been saying (especially when it earlier announced that a short covering rally in the EURUSD is imminent, as we have been warning for the past two weeks), it may be time to get concerned. From Morgan Stanley: "Most investors I speak with concur with the view that growth is likely to be below trend for the next several years thanks to deleveraging and a more stringent regulatory environment. However, there is quite a bit of excitement over the probability of QE3 being implemented at some point during 2Q. Exhibit 5 shows just how excited stock investors seem to be getting over this prospect, especially in relation to their fixed income peers. But, this is almost always the case when animal spirits get going. The last time I pointed out such a divergence (October of last year), the SPX had a swift 10% correction over the proceeding 3 weeks. I have no idea whether we are likely to get such a correctly immediately, but I sure can’t rule it out and I am pretty confident you won’t be able to get out of the way unscathed. Just another reason for why I want to be paired off right now." Also, this time will never be different: "Didn’t we learn anything from the Japanese experience of the past 20 years! I might be more on board with the program if I thought we were making real progress on the things that matter for sustainable organic growth. Unfortunately, I just don’t see it."
In most countries, deleveraging is only in its early stages.
In a report today, McKinsey notes that total debt to GDP has declined
in only three countries since the 2008-09 crisis (US, South Korea, and
Australia) as total debt has actually grown in the world's ten largest
mature economies (due mainly to rising government debt - Keynesian
style?). Greatly concerned that the UK and Spain are slow to delever,
they do note that the US is more closely following the two phase
deleveraging process that 1990s Finland and Sweden followed but point to
the household segment as leading the way with 15% reduction in debt to
disposable income (driven unsurprisingly in major part by mortgage
defaults). The bottom line is US (households) are at best
one-third of the way through their deleveraging and the UK (financials)
and Spain (non-financials) face much more significant pressures
(which will inevitably impact aggregate demand given governmental
borrowing pressures) as their deleveraging has only just begun.
Historically, deleveraging has begun in the private sector and
government has stepped up to borrow and fill the aggregate Keynesian
hole left behind. McKinsey points out deleveraging normally takes 4-6
years which we suspect will remain an anchor for demand and growth in
the mean-time (perhaps as disappointing earnings revisions are already
pointing to).
by Frank Tang, Reuters:
(Reuters)
– Prominent Canadian fund manager Eric Sprott said on Wednesday he was
bearish on cyclical commodities such as industrial metals because of the
economic slowdown, though he remained positive on gold and crude oil.
Sprott, a long-time gold bull who last week filed to launch a platinum and palladium product allowing investors to redeem the physical metals, said he expects that business to grow in the wake of MF Global’s collapse.
“I am not bullish on cyclical commodities such as iron ore, coal, steel, lead and zinc because I am worried about this economic contraction that everybody is talking about,” Sprott told Reuters in a phone interview from his Toronto office.
He expects gold to hit a record above $2,000 an ounce this year, with silver also rallying to an all-time high at more than $50 an ounce. On Wednesday, gold traded at $1,660 an ounce and silver at $30.50.
Read More @ Reuters.com
In order to stimulate our economy, it sounds like the Fed plans to pump-it-up with a $1 trillion easing project.
And it could happen as early as this month…
CNBC reports:
“There seems
little point in waiting to implement further easing, and to do so could
confuse the message the Fed is trying to deliver at a point in time when
it is trying to make its communication with the public clearer,” he
said.
Next week, the Fed’s Open Market Committee will meet to discuss
matters further. Meanwhile “expectations are rising that the languishing
housing market will drive the central bank to buy up mortgage-backed securities.”The aim of those purchases will be to push interest rates even further and to indirectly induce confidence that there are more “monetary tools” that can revive the economy.
Read More (and Watch the Video) @ WealthWire.com
The Stock Ramp Is Just More Deja Vu "Insanity" Warns Morgan Stanley
When Morgan Stanley now agrees with most of what Zero Hedge has been saying (especially when it earlier announced that a short covering rally in the EURUSD is imminent, as we have been warning for the past two weeks), it may be time to get concerned. From Morgan Stanley: "Most investors I speak with concur with the view that growth is likely to be below trend for the next several years thanks to deleveraging and a more stringent regulatory environment. However, there is quite a bit of excitement over the probability of QE3 being implemented at some point during 2Q. Exhibit 5 shows just how excited stock investors seem to be getting over this prospect, especially in relation to their fixed income peers. But, this is almost always the case when animal spirits get going. The last time I pointed out such a divergence (October of last year), the SPX had a swift 10% correction over the proceeding 3 weeks. I have no idea whether we are likely to get such a correctly immediately, but I sure can’t rule it out and I am pretty confident you won’t be able to get out of the way unscathed. Just another reason for why I want to be paired off right now." Also, this time will never be different: "Didn’t we learn anything from the Japanese experience of the past 20 years! I might be more on board with the program if I thought we were making real progress on the things that matter for sustainable organic growth. Unfortunately, I just don’t see it."
Global Deleveraging - You Are (Not) Here
In most countries, deleveraging is only in its early stages.
In a report today, McKinsey notes that total debt to GDP has declined
in only three countries since the 2008-09 crisis (US, South Korea, and
Australia) as total debt has actually grown in the world's ten largest
mature economies (due mainly to rising government debt - Keynesian
style?). Greatly concerned that the UK and Spain are slow to delever,
they do note that the US is more closely following the two phase
deleveraging process that 1990s Finland and Sweden followed but point to
the household segment as leading the way with 15% reduction in debt to
disposable income (driven unsurprisingly in major part by mortgage
defaults). The bottom line is US (households) are at best
one-third of the way through their deleveraging and the UK (financials)
and Spain (non-financials) face much more significant pressures
(which will inevitably impact aggregate demand given governmental
borrowing pressures) as their deleveraging has only just begun.
Historically, deleveraging has begun in the private sector and
government has stepped up to borrow and fill the aggregate Keynesian
hole left behind. McKinsey points out deleveraging normally takes 4-6
years which we suspect will remain an anchor for demand and growth in
the mean-time (perhaps as disappointing earnings revisions are already
pointing to).SOPA Shelved
And so following a massive groundswell of protest with the government's attempt to blatantly confiscate the First Amendment, SOPA quietly dies.LTRO Version 0.2
LTRO version 1.0 continues to capture the market's attention. It was a reason to rally, then fade, now back to an excuse to rally. Our contention all along has been that LTRO was good for banks. It dramatically reduced the liquidity risk for banks. It did nothing for the solvency of banks or sovereigns, and we continue to believe it doesn't do anything for the liquidity risk of sovereigns. We think the belief that the carry trade is at work is a fallacy. Banks did NOT take down LTRO to buy new assets and are still in deleveraging mode, so will NOT use the next LTRO offering to take on new money. We will see what happens but Peter Tchir believes that the second tranche of LTRO will be a pale comparison of the first in terms of size which will damage market excitement over how much of the "carry" trade is going on.(Reuters)
– Prominent Canadian fund manager Eric Sprott said on Wednesday he was
bearish on cyclical commodities such as industrial metals because of the
economic slowdown, though he remained positive on gold and crude oil.Sprott, a long-time gold bull who last week filed to launch a platinum and palladium product allowing investors to redeem the physical metals, said he expects that business to grow in the wake of MF Global’s collapse.
“I am not bullish on cyclical commodities such as iron ore, coal, steel, lead and zinc because I am worried about this economic contraction that everybody is talking about,” Sprott told Reuters in a phone interview from his Toronto office.
He expects gold to hit a record above $2,000 an ounce this year, with silver also rallying to an all-time high at more than $50 an ounce. On Wednesday, gold traded at $1,660 an ounce and silver at $30.50.
Read More @ Reuters.com
by Peter Cooper, Arabian Money via GoldSeek:
If
anything gold and silver forecasters are probably too cautious about
the outlook for 2012. This is not surprising after the volatility of
2011 which saw record highs for both metals but a collapse later in the
year that left gold up 10 per cent and silver down around the same
amount for the year.
The worry for precious metal investors is that deflation and recession will overcome the inflationary forces of money printing in 2012 and limit the upside for prices.
Correction done?
But while it is certainly possible to see a 2008-style drop in commodity prices in another global financial crisis, most likely with the eurozone at its epicentre this time, the correction that we have already seen in precious metals probably shields them from a copycat correction. In short the correction is largely behind us, whereas in late 2008 it was well overdue.
Read More @ GoldSeek.com
from GoldMoney.com:
More
encouraging US economic data again led to gains in copper futures
yesterday. Successful Spanish and French debt auctions also saw the euro
move higher against the dollar; as The Wall Street Journal reports
(and was noted in our article yesterday) given copper’s industrial
utility, gains in copper usually coincide with improving economic
sentiment.
Precious metal prices had a quiet day yesterday, though this may not last long. Economists are predicting that the Federal Reserve will announce more quantitative easing measures within the next couple of months. Estimates vary from $750 billion to $1 trillion of asset purchases, targeted at mortgage-backed securities. Market analyst Andrew Wilkinson comments at CNBC that the amount of equity American homeowners have as a percentage of their disposable household income has fallen to 54%, which he calls “unprecedented” territory. In his words: “This simple fact represents uncharted territory for the Federal Reserve… Despite a recovery in growth and employment, the crippling damage inflicted by the subprime warhorse continues to play a worrisome role behind the scenes.”
Read More @ GoldMoney.com
If
anything gold and silver forecasters are probably too cautious about
the outlook for 2012. This is not surprising after the volatility of
2011 which saw record highs for both metals but a collapse later in the
year that left gold up 10 per cent and silver down around the same
amount for the year.The worry for precious metal investors is that deflation and recession will overcome the inflationary forces of money printing in 2012 and limit the upside for prices.
Correction done?
But while it is certainly possible to see a 2008-style drop in commodity prices in another global financial crisis, most likely with the eurozone at its epicentre this time, the correction that we have already seen in precious metals probably shields them from a copycat correction. In short the correction is largely behind us, whereas in late 2008 it was well overdue.
Read More @ GoldSeek.com
from GoldMoney.com:
More
encouraging US economic data again led to gains in copper futures
yesterday. Successful Spanish and French debt auctions also saw the euro
move higher against the dollar; as The Wall Street Journal reports
(and was noted in our article yesterday) given copper’s industrial
utility, gains in copper usually coincide with improving economic
sentiment.Precious metal prices had a quiet day yesterday, though this may not last long. Economists are predicting that the Federal Reserve will announce more quantitative easing measures within the next couple of months. Estimates vary from $750 billion to $1 trillion of asset purchases, targeted at mortgage-backed securities. Market analyst Andrew Wilkinson comments at CNBC that the amount of equity American homeowners have as a percentage of their disposable household income has fallen to 54%, which he calls “unprecedented” territory. In his words: “This simple fact represents uncharted territory for the Federal Reserve… Despite a recovery in growth and employment, the crippling damage inflicted by the subprime warhorse continues to play a worrisome role behind the scenes.”
Read More @ GoldMoney.com
Santschi’s Daily Edge 1/19/2012: The Reasons for Rising Stock Prices
Ron Paul Highlights – South Carolina CNN Debate 01/19/12
[Ed. Note: Related.]
from USAWatchDog:
USAWatchdog.com – Big story this week was the grounding of the cruise ship, Costal Concordia. There are about a dozen dead and twenty more missing off the coast of Italy. This story is big because of the astonishing video of the ship on its side. It took away time for stories that are much more important, and, no, I am not talking about the tawdry tale from Newt Gingrich’s ex-wife. This is all the stuff to keep the public busy with the things that really do not affect their lives. The internet piracy legislation in the House and Senate affect all Americans, and little is said about it in the mainstream media (MSM). Thousands of sites are protesting, and Congress is feeling the heat. Many say this is much more than stopping internet piracy but censorship of free speech. Iran naval commanders say they have the torpedo technology to sink a U.S. aircraft carrier. The rhetoric is increasing by the day right along with the possibility of war. Congressman Ron Paul took a break from campaigning to introduce legislation to strip the NDAA law of its indefinite detention provisions. Many are against the detainment of Americans without formal charges or trial for terrorism. Why isn’t the MSM covering this important battle? All these stories and more are covered by Greg Hunter’s USAWatchdog.com in the Weekly News Wrap-Up.
from USAWatchDog:
USAWatchdog.com – Big story this week was the grounding of the cruise ship, Costal Concordia. There are about a dozen dead and twenty more missing off the coast of Italy. This story is big because of the astonishing video of the ship on its side. It took away time for stories that are much more important, and, no, I am not talking about the tawdry tale from Newt Gingrich’s ex-wife. This is all the stuff to keep the public busy with the things that really do not affect their lives. The internet piracy legislation in the House and Senate affect all Americans, and little is said about it in the mainstream media (MSM). Thousands of sites are protesting, and Congress is feeling the heat. Many say this is much more than stopping internet piracy but censorship of free speech. Iran naval commanders say they have the torpedo technology to sink a U.S. aircraft carrier. The rhetoric is increasing by the day right along with the possibility of war. Congressman Ron Paul took a break from campaigning to introduce legislation to strip the NDAA law of its indefinite detention provisions. Many are against the detainment of Americans without formal charges or trial for terrorism. Why isn’t the MSM covering this important battle? All these stories and more are covered by Greg Hunter’s USAWatchdog.com in the Weekly News Wrap-Up.
by Gary North, LewRockwell.com:
I
have posted a video of something I thought I would never see: all five
of the Republican candidates for the U.S. Senate verbally demanding an
audit of the Federal Reserve System. You can see it here.
Bernanke is facing what no Federal Reserve chairman has ever faced: public awareness of the Federal Reserve System. From late December 1913, when an almost deserted Senate voted for the Federal Reserve Act, until 2008, when the recession confirmed Ron Paul’s warning in late 2007, there was almost no public awareness or even a vague understanding of the Federal Reserve System. The genie is now out of the bottle, where it had been corked since 1913. Ron Paul has uncorked it.
From the November 1910 secret meeting at Georgia’s Jekyll Island until Ron Paul’s 2007 candidacy for the Republican nomination for President, The Federal Reserve had received a free ride from Congress. There had never been much oversight. That’s because FED regulation was an oversight. (The same word is used to convey opposite meanings.)
The Texas Leftist-populist Democrat Wright Patman had been a critic. He had been the chairman of the House Banking Committee until 1975, a year before Paul arrived in Congress. He was a Greenbacker: a believer in a zero-interest economy that achieves this Utopian goal through the use of fiat paper money. Patman was not able to generate much interest in the FED.
Read More @ LewRockwell.com
You Decide...
I
have posted a video of something I thought I would never see: all five
of the Republican candidates for the U.S. Senate verbally demanding an
audit of the Federal Reserve System. You can see it here.Bernanke is facing what no Federal Reserve chairman has ever faced: public awareness of the Federal Reserve System. From late December 1913, when an almost deserted Senate voted for the Federal Reserve Act, until 2008, when the recession confirmed Ron Paul’s warning in late 2007, there was almost no public awareness or even a vague understanding of the Federal Reserve System. The genie is now out of the bottle, where it had been corked since 1913. Ron Paul has uncorked it.
From the November 1910 secret meeting at Georgia’s Jekyll Island until Ron Paul’s 2007 candidacy for the Republican nomination for President, The Federal Reserve had received a free ride from Congress. There had never been much oversight. That’s because FED regulation was an oversight. (The same word is used to convey opposite meanings.)
The Texas Leftist-populist Democrat Wright Patman had been a critic. He had been the chairman of the House Banking Committee until 1975, a year before Paul arrived in Congress. He was a Greenbacker: a believer in a zero-interest economy that achieves this Utopian goal through the use of fiat paper money. Patman was not able to generate much interest in the FED.
Read More @ LewRockwell.com
You Decide...
[Ed. Note: Is this video inaccurate, partially
accurate, or 100% truth? We have our opinion, what's yours? Inspired
conversation welcome in the comments section below, so fire away.]
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