The Seeds For An Even Bigger Crisis Have Been Sown

On occasion of the publication of his new gold report (read here), Ronald Stoeferle talked with financial journalist Lars Schall about fundamental gold topics such as: "financial repression"; market interventions; the oil-gold ratio;  the renaissance of gold in finance;  "Exeter’s Pyramid"; and what the true "value" of gold could actually look like. Via Matterhorn Asset Management.

All Hell is Going to Break Loose on the Upside in Gold

from KingWorldNews:

With the US dollar hitting fresh two year highs, stock markets struggling around the world, and gold holding firm, today King World News interviewed acclaimed money manager Stephen Leeb, Chairman of Leeb Capital Management, to get his take on what is happening. Leeb told KWN there is a huge scandal because “…the banks don’t have the gold the customers are paying them to have on deposit,” and “all hell is going to break loose on the upside.”
Here is what Leeb had to say about the scandal: “Examples that people like Eric Sprott have given, where an individual depositing gold in 2009, when they asked to get their gold back there were long delays. And the gold bars they got back were certainly not the gold they deposited because they came back dated 2011. What’s that all about?”
“What’s amazing to me right now, Eric, it’s come down to a world where the war is between those who believe in capitalism and those who don’t. What is interesting is that you have people on the right and the left that have banded together. They don’t trust government and they don’t trust the system, and who can blame them?
Stephen Leeb continues @ KingWorldNews.com

How Your Bank Account Could Disappear

by Jeff Nielson, Bullion Bulls Canada:
On the same morning we hear that ¼ of Wall Street executives think that fraud is a necessary part of “doing business” in the financial sector, we hear of a second “MF Global”. The U.S.’s so-called regulators are now reporting that somewhere around $220 million in customer funds is “missing” at a financial institution known as PFGBest; once again closing the barn door after all the cows have run off.
With at least one out of every four bankers at U.S. Big Banks (that’s how many admitted to being crooks in the survey) thinking that stealing is part of their job descriptions, it’s very important for people to realize how little protection there now is between these thieves and your bank accounts. Based on the writing of a number of other individuals with more expertise in these markets, it is apparently an inherently fraudulent banking process known as “rehypothecation” which is allowing the mass-plundering of accounts at U.S. financial institutions, with other Western financial regulatory authorities also rubber-stamping this relatively new form of bankster crime.
Rehypothecation is a heinous practice permitted by the pretend-regulators of Western markets, where financial institutions are allowed to pledge their clients’ funds as collateral to cover their own gambling debts. I say “inherently fraudulent” since few of the clients of these financial institutions would ever knowingly enter into contracts with these gambling-addicts where their cash could be used to cover their bankers’ gambling debts.
Read More @ BullionBullsCanada.com

Five Words For the United Nations: FROM MY COLD DEAD HANDS

[Ed. Note: Mr. Slavo, that will be my cold dead hand right next to yours. (Figuratively speaking of course, because we're going to win.)]

by Mac Slavo, SHTFPlan:

In January of this year reports began surfacing that members of the United Nations were conspiring with American politicians to further erode the Second Amendment rights of the people of these United States:

“In New York, right here on our own shores, we’ve got a Trojan horse. They won’t accept U.S. firearms policy. They want to take the decision away from the U.S. electorate and undermine our Constitution.”
Ambassador Faith Whittlesey
US Delegate to UN Small Arms Conference
January 2012 

While actions at the UN posed a serious threat to our right to bear arms, few acknowledged the legitimacy of the issue and fewer still had even heard anything about it.
The Obama administration is now just a matter of weeks away from joining other foreign powers in the signing of the Arms Trade Treaty at United Nations.
While many will argue that the new treaty will not restrict gun ownership in America, 2nd Amendment proponents disagree and maintain that  the new treaty could pave the way for an eventual nationwide gun grab.
Dick Morris, who is spearheading a petition to stop Barack Obama, Hillary Clinton and the United States from signing the treaty, explains the inherent dangers within:
Read More @ SHTFPlan.com

US Attorneys General Jump On The Lieborgate Bandwagon; 900,000+ Lawsuits To Follow?

The second Barclays announced its $450 million Libor settlement, it was all over - the lawyers smelled not only blood, but what may be the biggest plaintiff feeding frenzy of all time. Which is why it was only a matter of time: "State attorneys general are jumping into the widening scandal over whether banks tried to manipulate benchmark international lending rates, a move that could open a new front against the top global banks. A handful of state attorneys general said they are looking into whether they have jurisdiction over the banks, and are starting preliminary discussions to determine what kind of impact the conduct involving the Libor rate may have had in their states."

Economic Countdown To The Olympics 1: Impact On Stock Markets

With 15 days until the Olympics, we introduce the first in a five-part series of market-and-economy related discussions centered on that glorious event. As global equities exhibit their own 'Citius, Altius, Fortius', Goldman looks at the impact of the Olympics on stock markets. They note that, aside from the benefit of raising the international profile of the host country as both a tourism and investment destination, the announcement of a winning Olympic bid means major investment in infrastructure, including stadiums, accommodation and transport to prepare for the Games. Interestingly, all recent Olympic hosts have outperformed the MSCI World index in the 12 months following the Olympics. This is true of recent hosts regardless of the size of the economy or state of development, suggesting either the local market is boosted by the international profile of the Games, or is perhaps relieved to have the Games behind them. Given the below-average performance in the UK since the Olympic announcement, UK investors may hope for a continuation of this trend, looking forward to a positive year in equities following the London 2012 Games.

Biderman Demands New 'Non-Parasitic' Constitutional Convention

"If we continue forward in the direction we are headed, what lies ahead is an almost certain major economic calamity" is the subtle introduction from the Bay-Area baddest bull-crusher. Charles Biderman, CEO of TrimTabs, is angry - and you wouldn't like him when he's angry - as he believes "it no longer matter who wins elections, because the special interest groups control, and in some cases own, the representatives" and the US needs a new constitutional convention. He has touched on this before but his ire is very clear here as he sees the "special interest groups as parasites" and believes that due to the rapid changes in social media technologies that a new way of governing ourselves is possible (though we still doubt it). "The road ahead to a new constitutional convention will not be easy," he concludes, given the big bucks will try and convince us they are necessary, but it appears Lewis Black's avuncular alter ego is ready to take 'em on.

Rioting on the streets of Madrid and Athens/Gold and silver withstand another raid/Spain issues another austere budget.

Harvey Organ at Harvey Organ's - The Daily Gold and Silver Report - 2 hours ago

Good evening Ladies and Gentlemen: Gold closed down today by only $4.10 top $1575.20 as gold recovered much of its losses suffered in the access market.  Silver rose by 10 cents to $26.95.  Today we witnessed rioting on the streets of Madrid and Athens.  Madrid introduced huge tax increases as they raised their VAT from 18% to 21% and cut off many of unemployment benefits.  On this side of the

The Deleveraging Trap

The debt-to-GDP ratio is gradually falling, yet it is still at a far higher level than the historical average, and it is still proportionately higher than industrial output. And at the same time, consumers are re-leveraging, and government debt is soaring. And industrial production is barely above where it it was a decade ago, and far below its pre-2000 trend line. We have barely started, and already this has been a slow and grinding deleveraging; rather than the quick and brutal liquidation like that seen in 1907 where the banking system was effectively forced into bailing itself out, the stimulationist policies of low rates, quantitative easing and fiscal stimulus have kept in business zombie companies and institutions carrying absurd debt loads. Like Japan who experienced a similar debt-driven bubble in the late ’80s and early ’90s, we in the West appear to have embarked on a low-growth, high-unemployment period of deleveraging; and like Japan, we appear to be simply transferring the bulk of the debt load from the private sector to the public, without making any real impact in the total debt level, or any serious reduction in the debt-to-GDP ratio. 



More... "Change You Can Believe In"...

"The Use Of Temps Is Outpacing Outright New Hirings By A 10-To-1 Ratio"

For many months, if not years, we have been beating the drum on what we believe is the most hushed, but significant story in the metamorphosis of the US labor pool under the New Normal, one which has nothing to with quantity considerations, which can easily be fudged using seasonal and birth death adjustments, and other statistical "smoothing" but with quality of jobs: namely America's transformation to a part-time worker society. Today, one of the very few economists we respect, David Rosenberg, pick up on this theme when he says in his daily letter that "the use of temps is outpacing outright new hirings by a 10-to-1 ratio." And unlike in the old normal, or even as recently as 2011, temp hires are no longer a full-time gateway position: "Moreover, according to a Manpower survey, 30% of temporary staffing this year has led to permanent jobs, down from 45% in 2011.... In today's world, the reliance on temp agencies is akin to "just in time" employment strategies." Everyone's skillset is now a la carte in the form of self-employed mini S-Corps, for reason that Charles Hugh Smith explained perfectly well in "Dear Person Seeking a Job: Why I Can't Hire You." Sadly, that statistic summarizes about everything there is to know about the three years of "recovery" since the recession "ended" some time in 2009.

Two And Twenty And Zero To Show For It As Hedge Funds Underperform The Stock Market

With AAPL and several other strange-attracting hedge fund hotels dominating the holdings of the 2-and-20'ers, we thought it timely that Bloomberg TV would point out today that their aggregate hedge fund index is now significantly underperforming the S&P 500 (from both the top in 2007 and the lows in 2009 - in order to be fair). While the assumption is that 'sophisticated' investors are paying for alpha - and as always the focus is absolute return on the way up no matter what the mandate - it seems the extreme correlations both across asset-class and within-and-across individual equities (as we have discussed in depth - most recently here) have indeed eaten into any 'value' that has empirically been added. As The Economist notes, in June "funds suffered the largest withdrawals in assets since October 2009." Furthermore, as Citi's recent study on risk drivers shows, the high-beta momentum trade has become by far the most crowded trade around - so even sales of DB9s and NYC apartments are now entirely dependent on NEW QE coming before year-end.

The Collectivist War Against Cultural Heritage

The ideological brand of so-called progress that we call “collectivism” relies heavily on the notion that the values of the past are inadequate to the requirements of the future.  We are taught by the peddlers of collectivist propaganda that our beliefs and our principles must evolve along with the perceived growth of our species as a whole.  They see themselves as visionaries and prophets foretelling a grand reinvention of the world that we laymen are unequipped to imagine or understand.  We cling to the old ways because we are “afraid of change”, or too ignorant to fathom the beauty of their Utopian beyond… Pretentious bile?  Absolutely.  However, within the rhetoric and strategies of the collectivist agenda there are treasures to behold; reoccurring themes and indicators that can be found in nearly every modern tyranny and most ancient tyrannies that have ever existed.  Words and actions that warn us of the true intent of the elite.  The fact is, collectivists drive so hard to admonish respect for the past because every lie they tell us now has been told before a thousand times, to build a thousand gruesome empires. 

Livestream From An Angry Madrid

And to think we were only joking less than 12 hours ago...

Despite Low Volume Schizophrenia, S&P Extends Losses To 5th Day

Normal. 7bps instaswings in 10Y Treasury yields and 10 point S&P 500 e-mini futures (ES) dips and rips makes perfect sense. In a desperate bid to get back to VWAP and to hold off a fifth day of red closes in the cash S&P 500 (most in two months), equities were ramped up into the green in the last few minutes of the day only to be sold into hard (on heavier volume and larger average trade size) ending the day down 0.02 points at 1341.45. Quite a day as the 10Y auction and FOMC minutes made for a tempest in a teapot close to close (but cardiac arrests for many intraday). HYG (the high-yield bond ETF) was outperforming most of the day and provided the 'target' for the ramp at the end of the day as VXX dumped (thanks to a more-than 1 vol snap lower in VIX - sell that short-dated vol!!!) and TLT was stable. Oil's surge (inventories) accelerated as the USD leaked lower after its post-FOMC spike and Gold/Silver/Copper all pushed higher also. We can only assume that the post-FOMC drop of around 10pts in the S&P 500 was what many investors believe is enough to prompt swift action by the Fed to NEW QE - though between Oil's move and Treasury yields rising post the the auction (and more post FOMC), broad risk assets actually signal a slightly higher ES - though we suspect the utter collapse in cross-asset-class correlations is the signal that coordinated QE hopes are indeed fading and that the algos late-day reaction (rip) to Treasuries will be recalibrated to new reality soon enough. Cash S&P 500 ended up bouncing off its 50DMA and while ES ended the day +1.25pts, VIX dropped a much higher beta 0.75vols to close just below 18% - wth Treasury yields up 1-2bps by the close.

Paul “King” Krugman knocked off his Ivory Tower as Fools Sack the Hill!

from CapitalAccount:

Viewpoint: Eliot Spitzer and Matt Taibbi Discuss LIBOR

from, Current.com:

Doug Casey on “Atlas Shrugged”

Interviewed by Louis James, Casey Research:

L: Doug, the news of the day is the somewhat surprising – to some – decision by The Supremes to uphold “Obamacare.” Any thoughts to share?
Doug: I hate to clutter my mind with stupidities and political trivia; I have more interesting things to think about. I know people like to get all worked up about these things, but it’s all déjà vu – just another nail in the coffin of the America that Was. I certainly don’t want to get into the legal details of this sort of nonsense. It’s like medieval monks arguing about how many angels can dance on the head of a pin. The people in government don’t operate on any actual principles. That’s part of what economic fascism is all about: the complicity of government and business. We’ve talked about the Constitution, which has been a dead letter for years – but anyone who reads that unfortunately flawed document will see that the state should have nothing whatsoever to do with how people pay for their medical bills. But what the Constitution actually says is of no real interest to these people; for them, it’s all a game of figuring out how to do whatever they want, to further their own interests.
I don’t know why anyone should be surprised by the decision. It’s naïve to expect these black-robed employees of the state, whose appointed task is to uphold the state’s law, to cut back on the power of their employer. It’s all a ridiculous charade; they can and will do whatever they want.
L: So it doesn’t matter?
Read More @ CaseyResearch.com

Gordon Brown Dumped Britain’s Gold to Save Goldman Sachs & JP Morgan

from Silver Doctors:
The Telegraph’s Thomas Pascoe has released a riveting account of why Gordon Brown dumped 400 tonnes of Britain’s gold (which has been dubbed Brown’s Bottom) intentionally at the lowest price possible.
Pascoe’s sources have informed him that one globally significant US bank was short 2 tonnes of gold at the time of the 400 tonne gold dump.
Pascoe alleges that Gordon Brown used various mechanisms (telegraphing the sale, using an auction rather than the London fix, etc) to intentionally sell Britain’s gold reserves at the lowest possible price to save the necks of Goldman Sachs’ massive gold shorts (which likely included JP Morgan which was even more massively short gold at the time).
Read More @ SilverDoctors.com

I Lose a Bet, Start an Argument

by Bruce Krasting Bruce Krasting Blog:
Back on November 17, 2011 I penned a piece in response to Fed Governor Bullard’s assertions regarding the collapse of MF Global. Bullard thought there was no lasting consequences to that blow-out:
At the time, I thought that Bullard was full of crap, and that there would be significant consequences to the collapse of MFG. My words:
Okay, Mr. Bullard I’ll make you a wager. A six pack of your favorite beer. Give the MFG story another month and it will be a problem. It will undermine markets. It will impact confidence in our financial system. It will impact liquidity. As those things will occur it will force both the Treasury and the Fed to take actions.
I was wrong, Mr. B was right. There were no consequences to the MFG disaster. No heads rolled. No one went to jail. There were no lasting economic consequences. There were were no regulatory changes. The MFG affair was buried.
Bullard never accepted my bet, but I still feel I owe him. If he reads this and sends me a note I will forward his beer. He deserves it. He won. Unfortunately, we all “lost” as a result.
Today we have yet another MFG in our laps. Perigrine Financial has followed the exact same path as MFG. The PFG bankers looted customer accounts.
Read More @ BruceKrasting.blogspot.com

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Newt Gingrich Autographs a Bohemian Grove Picture… of Himself. Doh!

from WeAreChange:

Once Again, Luke Rudkowski of WeAreChange confronts Newt Gingrich on Bohemian grove, but this time, Luke has proof of Newts attendance.

Euro Back From the Brink Again? What a Surprise …

by The Daily Bell:
How all-night Brussels showdown pulled euro back from brink … They were bleary-eyed in their crumpled suits early on Friday morning, but euro zone negotiators were smiling after a hard-fought night of talks that struck a surprisingly far-reaching deal to prop up the euro. An agreement to let the euro zone’s rescue funds directly recapitalize banks – something Spain has long held out for – went substantially beyond what almost all diplomats and finance officials expected going into the two-day summit. – Reuters
Dominant Social Theme: Thank God it turned out for the best.
Free-Market Analysis: Yesterday, in an article entitled “Merkel and Hollande – Best in the World,” we pointed out that much of what passed for news analysis in the mainstream press was simply leader-worship, a definitive dominant social theme.
Read More @ TheDailyBell.com

As Evidence Mounts, DC Insiders Worry About Holder’s Inaction on Wall Street Crime

by Richard (RJ) Eskow, HuffingtonPost.com:
More and more Washington insiders are asking a question that was considered off-limits in the nation’s capital just a few months ago: Who, exactly, is Attorney General Eric Holder representing? As scandal after scandal erupts on Wall Street, involving everything from global lending manipulation to cocaine and prostitution, more and more people are worrying about Holder’s seeming inaction — or worse — in the face of mounting evidence.
Confidential sources say that the President’s much-touted Mortgage Fraud Task Force is being starved for vital resources by the Holder Justice Department. Political insiders are fearful that this obstruction will threaten Democrats’ chances at the polls. Investigators and prosecutors from other agencies are expressing their frustration as the ever-rowing list of documented crimes by individual Wall Street bankers continues to be ignored.
Meanwhile the scandals and revelations go on. The new LIBOR rate-fixing scandal led the bank-friendly and conservative magazine The Economist to run a cover about “Banksters” and to publish a piece entitled “The rotten heart of finance.” People like Robert Reich are saying this could be the story that finally brings down the banks.
Read More @ HuffingtonPost.com

Prepping on the Cheap: The $5 a Week Shopping Challenge

by Tess Pennington, SHTFPlan:

One of the biggest excuses that people make for not prepping is that they can’t afford it.  “I can’t even afford the groceries we eat every week as it is!” they complain when urged to start buying extra food.
This week I made a trip to three different stores.  I went to Wal-Mart, the dollar store and a grocery store. Not to locate the best prices but to locate the regular prices on common food items that might find their way into a prepper’s pantry.  The following list is not based on mega-markdown loss leaders – it is based on the normal price and availability.
Here are 52 stock-ups – one for each week!

• 15 packs of Ramen Noodles
• 6 cans of  mixed vegetables
Read More @ SHTFPlan.com

The War Between Manipulation and Buying

July 11, 2012, at 2:09 pm
by Jim Sinclair

**Originally posted July 6, 2012**

My Dear Extended Family,

Next week is the war between manipulation of gold by the West, and appetite for buying gold in the East, both from friendlies and enemies. Anyone that does not see today’s gold market as a rig is blind or brain dead. There is a full blown crisis in Western world banking today, right here and now. There is a full blown crisis in sovereign debt of some weaker nations as in a very short while certain government will be out of money. The Eurosnobs hate each other which does not make for a fast reconciliation of a crisis. 

It is a myth that Western banks are strong enough to weather the storm of a full blown banking crisis in Europe. 

It is a myth that the Federal Reserve will stand as the one hawk in the Western world and fiddle while it’s Rome burns. 

It is a myth that Obama could be re-elected if the Fed remains intransigent. 

It is a myth that Finland or Germany will strike a match to the euro that totally wipes out the largest part of their exports. 

It is a myth that governments are ready to face the economic, social and political fallout standing austere as their economies implode, which they will. 

It is myth that there is any recovery in the USA. By falling more we will be in a depression. 

It is a myth that because thousands of bears email me that somehow they can convince me of the opposite when I know I am correct. 

Next week will be the time the cartel tries to break the gold price again. They have failed seven times, and will fail on the 8th. Gold is going to $3500 and above. All the lying and conniving only means the price will go higher. Just as Morgan’s whale could not fight the market, the cartel cannot fight gold as we have a flight away from all fiat currencies.

How can anyone in Europe sleep tonight with cash in the bank, even amongst the stronger nations whose banks are loaded with weak nation’s paper. The house of cards is coming down right now. Trying to manipulate the price of gold to hide the crisis at hand is futile.

If you have your positions on margin you are crazy and I cannot do anything for you. All others stand tall because gold will trade above $3500 and not in some LaLa Land future of Armstrong’s imagination.

Respectfully,
Jim

 

In The News Today

July 11, 2012, at 11:33 am
by Jim Sinclair

Knowledge makes a man unfit to be a slave.  
– Frederick Douglass











Jim Sinclair’s Commentary

There is only one method that the can be kicked by, and that is QE to infinity.

Jim Sinclair’s Commentary

This is just the beginning.

SAN BERNARDINO: City to seek bankruptcy protection BY IMRAN GHORI
Published: 10 July 2012 09:28 PM
The San Bernardino City Council voted Tuesday, July 10, to seek bankruptcy protection, calling it the city’s best option to solve a budget crisis in which it faces a $45 million deficit.
The 4-2 vote, with Councilmen Chas Kelley and Fred Shorett opposed, came at the end of a more than three-hour budget workshop where city officials presented a grim picture of the city’s finances. Councilman John Valdivia abstained.
City Attorney Jim Penman said it would likely take 30 days before he formally filed for bankruptcy.
City officials said they faced the possibility of being unable to make its Aug. 15 payroll for employees and pay some vendors.
Even if the city were to eliminate all departments except for police and fire, it would still face a deficit, interim City Manager Andrea Travis-Miller said.
"We have no choice but to act swiftly," she told the council. "Reorganization is the way to get us there."
Reorganization or Chapter 9 filing under bankruptcy law gives the city "breathing room" to restructure debts and get its finances in order, city officials said.
More…

 

Jim’s Mailbox

July 11, 2012, at 11:15 am
by Jim Sinclair

Jim Sinclair’s Commentary

The end is not near, it is here and now.

Jim,
This time it really IS different!
These two Bloomberg charts show that 2006-present IS different. Much different. Look at Gold vs. Treasury Yields. Gold is rising, and Treasury Yields are plumbing new depths.
They are worth comparing to Peter Millar’s graphic comparing Gold to Global Monetary base. All three seem to signal that the Keynesian end-game (reducing debt by creating new debt) is not coming, but is already here.
For skeptics, doubters, and deniers, consider this ‘indicator’ by following the wise guys/smart money: JPM (one of the Cartel’s main warhorses) has been THE biggest buyer of Canadian gold miner Goldcorp today, with NO sells. (Despite Goldcorp’s just-lowered guidance and a subsequent ~10% drop in share price).
Why?
What did old man Rothschild say? Something about buying when there was blood in the streets, and for the Gold miners there has been plenty of blood spilled. This may be THE time to buy them before people ‘catch on’ to the parabolic phase in Gold that is just ahead. By the time the Muppets wake up and smell the coffee, it will be far too late to catch the coming ride.
CIGA Richard



















Jim,

I love this one.
CIGA Luis Ahlborn Sequeira

There will be no bear market for physical gold until trust in the financial system and regulators is fixed, until markets trade fundamentals instead of the possibility of the NEW QE, until governments represent the interests of their people instead of the interests of tiny financial elites.


Dear Jim,
I would be grateful if you could amplify the statement that you made regarding investment in commodities today: "How can you continue to trade any commodity, especially gold, when you have no certainty that your funds will be returned to you? You simply cannot." I’m sorry but as a relative newcomer, I know that I do not fully understand what you mean and that it is of great importance to us, and perhaps to others to get this clear.
Thank you very much in advance,
CIGA Ginette

Ginette,

If your clearing house goes broke you have no assets there even if you were long 1000 gold contracts at $300. You are totally screwed.

Does that help clear things up?

Regards,
Jim

Dear Jim,
Soon people will realize the US is Greece times 100!
San Bernardino is the third California city to go bankrupt in two weeks.
The muni crash is here. Click here to read the article…
Regards,
CIGA David Madisonstyle

David,

To quote Yra Harris:

"The most evil have the largest soap box."

You need about a dozen failures in different states before the dumbed-down US sheeplez will start to get it.

Regards,
Jim

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