from KingWorldNews:
The Godfather of newsletter writers, Richard Russell, believes gold
will be used to save the world which is drowning in debt. Here is what
Russell had to say: “The national debt of the US is now well over $16
trillion and growing at the rate of over one trillion dollars a year.
It can never be paid off through the ‘normal’ means. Paying off by
normal means would entail a huge, really killer boost in taxes and a
brutal unmerciful, slashing of entitlements. The only way the US’s
debts can ever be seriously addressed is to devalue the dollar.”
“The US owns the world’s greatest hoard of gold. Here’s what I think the authorities have to do. They should unilaterally, overnight raise the price of gold to a high value, maybe around $10,000 an ounce. Thus, each dollar would be worth one ten-thousandth of an ounce of gold. This would allow our enormous debt to be paid off with vastly devalued dollars.
This would be inflationary, since everyone who owned gold would own a pile of devalued dollars. The huge increase in the number of dollars would drive prices up, and that would work against the current forces of deflation.
Richard Russell continues @ KingWorldNews.com
The Godfather of newsletter writers, Richard Russell, believes gold
will be used to save the world which is drowning in debt. Here is what
Russell had to say: “The national debt of the US is now well over $16
trillion and growing at the rate of over one trillion dollars a year.
It can never be paid off through the ‘normal’ means. Paying off by
normal means would entail a huge, really killer boost in taxes and a
brutal unmerciful, slashing of entitlements. The only way the US’s
debts can ever be seriously addressed is to devalue the dollar.”“The US owns the world’s greatest hoard of gold. Here’s what I think the authorities have to do. They should unilaterally, overnight raise the price of gold to a high value, maybe around $10,000 an ounce. Thus, each dollar would be worth one ten-thousandth of an ounce of gold. This would allow our enormous debt to be paid off with vastly devalued dollars.
This would be inflationary, since everyone who owned gold would own a pile of devalued dollars. The huge increase in the number of dollars would drive prices up, and that would work against the current forces of deflation.
Richard Russell continues @ KingWorldNews.com
Hungary Rebels Against IMF, Declines Aid Conditions
Even as Goldman's representative to the ECB continues to drone, a few hundred miles east of Frankfurt, one country has rebelled against the new world world:- HUNGARY REJECTS IMF AID CONDITIONS, PREMIER ORBAN SAYS
ECB Intervention Comment Du Jour: "Classic Banana Republic Banking"
Today's move can be summarized in one word: euphoria. The same
euphoria every previous instance of central planning intervention has
engendered, only to fade days, weeks or months later. But for the time
being it will suffice, and send the S&P to fresh post 2008 highs.
In the meantime, below is the definitive note summarizing what has just
happened, courtesy of Pierpont Securities, courtesy of Bloomberg.
ECB rides to rescue of Spain and Italy with long-awaited bond-buying plan
[Ed. Note:
What a terrific headline! Another Central Bank "rides to the rescue" of
a once ailing, once free people by printing money to buy their crappy
bonds. All is well! We are saved! Thanks Banksters!!]
from Mail Online:
The European Central Bank has unveiled a government bond-buying
programme to shore up the finances of struggling euro members such as
Spain and Italy.
The scheme [Ed. Note: that sounds about right] will provide a ‘fully effective backstop to prevent potentially destructive scenarios’, according to bank boss Mario Draghi.
He added that it would address bond market distortions and the ‘unfounded’ fears of investors about the single currency.
The bond purchases, which Draghi dubbed ‘outright monetary transactions’ will be unlimited and the ECB will be treated equally with private creditors in case of default.
Draghi’s announcement has been eagerly anticipated by markets ever since he vowed earlier this summer to do ‘whatever it takes’ to save the euro.
Read More @ dailymail.co.uk
from Mail Online:
The European Central Bank has unveiled a government bond-buying
programme to shore up the finances of struggling euro members such as
Spain and Italy.The scheme [Ed. Note: that sounds about right] will provide a ‘fully effective backstop to prevent potentially destructive scenarios’, according to bank boss Mario Draghi.
He added that it would address bond market distortions and the ‘unfounded’ fears of investors about the single currency.
The bond purchases, which Draghi dubbed ‘outright monetary transactions’ will be unlimited and the ECB will be treated equally with private creditors in case of default.
Draghi’s announcement has been eagerly anticipated by markets ever since he vowed earlier this summer to do ‘whatever it takes’ to save the euro.
Read More @ dailymail.co.uk
Desperate Maladies Require Desperate Measures
One of the primary purposes of a government, any government, is to sustain itself. In its final hours it will do almost anything possible for its self-preservation.
While everyone stares at Frankfurt and the last ditch effort of Mr.
Draghi there have been other events which are part of this play and
merit your attention. Austria has come out and stated quite succinctly
that no more Austrian money will be used for other countries; any other
countries. Yesterday the Netherlands stated in absolute terms that no
more of their money will be used for Greece. If the condition of any
ECB funding is to be the approval of the EU and the use of their
Stabilization Funds then what Mario Draghi is proposing may never come
to pass, may never happen and may just be a rhetorical exercise in wand
waving. To us, the world seems askew at present.
China is in serious decline, Europe is in a virtual recession as
Eurostat releases the numbers today and points to a -0.2% contraction
of the EU-17. The markets rally based upon the supposed three Saviors
of the world, the central banks of the United States, Europe and China
and so the worse that it gets the larger the rally as the central banks will ease and ease again until some kind of wall is hit.Draghi Market Response: EUR Down, Gold Down, EU Bond Yields Down, EU Stocks Down, US Stocks Surge
UPDATE: US equities surge on day-session open (as AAPL hits low of day)
Perception; Independence; Conditionality; Unlimited; Fully-Effective-Backstop. Draghi 'nailed-it' on the drinking game but it seems the world is not amused. The market's reaction to the new OMT is modest EUR weakness (and more JPY weakness), practically no change from US equities (and modest weakness in European equities), Gold and Silver disappointed at the 'conditionality' and not total print-fest; and yet 2Y Italian and Spanish bond yields - which flatlined for a while, are now dropping faster and the longer-dated Italian and Spanish yields are dropping also. US Treasuries are 5-6bps higher in yield. In Summary: "Spanish bonds soaring on hope Spanish bonds will plunge to allow Spanish bonds to soar on ECB purchases" - everything else not impressed.
Wall Street Analysts Respond To Mario Draghi
Confused
by the implications of Draghi's pre-leaked speech? Don't worry, you
are not alone. As the following sampling of opinions by Wall Street
experts via Reuters confirms, opinions range from the positive to the
negative, to the completely clueless.
Non-Manufacturing ISM Comes Diametrically Opposite To Manufacturing Indicator
Remember rule #1 of central planning: when in doubt, baffle with BS. Sure enough, after a very ugly Manufacturing ISM hit the tape two days ago, today we get a big beat out its sister tracker, the Non-manufacturing ISM,
which printed at 53.7 on expectations of a decline from last month's
52.6 to 52.5, in the process topping the highest Wall Street forecast
for the August number. Compounding the 'confounding' is that while the
mfg Employment indicator dropped, the non-manfucaturing employment rose
from 49.3 to 53.7. Perfectly logical? Exactly. At least there was some
symmetry in the Prices Paid indicator, which jumped both here as it did
two days ago, from 54.9 to 64.3: the largest component bounce of the
August series. And finally, whereas the manufacturing respondents were
uniformly bearish, those who rely on services are still full of hopium.
Sugar Is Going To Be Much Higher Over The Next Decade
Admin at Jim Rogers Blog - 47 minutes ago
I have no idea what is going to happen in 2012, but again sugar is going to
be much higher over the course of the next decade or so. Sugar is down
about 70% or 75% from its all-time high. Sugar has been amazingly depressed
in the past three-four decades. So sugar is going to go much much higher
before this bull market is over. I do not have a clue for what happens this
year. - *in Economic Times*
*Jim Rogers is an author, financial commentator and successful
international investor. He has been frequently featured in Time, The New
York Times, Barron’s, Forbes, Fortune, The Wall Stree... more »
European Markets Could Easily Correct 10 To 20 Percent From The Recent Highs
Admin at Marc Faber Blog - 1 hour ago
I think European markets could easily correct 10 to 20 percent from the
recent highs that we have had, but I don’t envision new lows.
I bought some shares in Portugal, Spain, Italy, and France, and after I
bought them in the last three to four months, the market rallied strongly.
I am negative on equities for the next three months, I’m not saying they
will collapse but they will go down and I will add to my positions when the
market corrects here. - *in CNBC Asia’s “The Call” *
*Marc Faber is an international investor known for his uncanny predictions
of the stock market and futures... more »
Gold and Silver Charts Impressive
Eric De Groot at Eric De Groot - 2 hours ago
The A-wave advance could retest the old highs by November 2012. Gold and
silver charts look impressive with a breakout of 16-month D-wave
consolidation underway. Chart: Gold & Silver ETF (GLD & SLV)
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More than 50 million Americans short of food
Eric De Groot at Eric De Groot - 2 hours ago
A growing number of Americans are beginning to understand what "very low
food security" means. That is, families are reducing the amount the amount
of food they eat and very often cannot afford to buy more food when it runs
out. This is a concept that much of the world already knows far too well.
Headline: More than 50 million Americans short of food NEW YORK
(CNNMoney)...
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content, and more! ]]
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contribution.
I'm PayPal VerifiedCorporate defaults are on the rise
Eric De Groot at Eric De Groot - 2 hours ago
Empires are defeated, die, and/or transformed not by external threats of
standing armies but rather from within. Excessive debt generated by
irresponsible leadership drives the internal implosion. Headline: Corporate
defaults are on the rise Q: Why are more companies having trouble repaying
their debts? Q: Why are more companies having trouble repaying...
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content, and more! ]]
Fears Rising, Spaniards Pull Out Their Cash and Get Out of Spain
Eric De Groot at Eric De Groot - 2 hours ago
Like rats fleeing from a sinking ship, the flight of capital from a
country, region, or economic zone, suggests that something is seriously
wrong. The flight of capital from Russia weakened the banks in 1998.
Long-Term Capital Management (LTCM) imploded by the fall of 1998 when the
contagion reached critical mass. A similar stripping of bank deposits in
Spain is pushing the contagion to the...
[[ This is a content summary only. Visit my website for full links, other
content, and more! ]]S&P Hits Post-2008 Highs
The
S&P 500 index just touched 1427.83 (up 1.75%) - surpassing the
recent highs and back to the local swing highs of 5/19/08 (1440.24 highs
that day)... that is all. VIX is down 1.5 vols at 16.25%Fed Unintended Consequence #267435: Homeowners Front-Running QE By Not Refinancing
For the fifth week in a row, MBA mortgage applications fell - dragged lower by a notably consistent drop in the refinance index - which dropped 3% this week alone and represents almost 80% of the total number of loans. Surely if rates are rising - as they have in general in the last few weeks - we would expect the 'rational homeowner of olde' to rush to his friendly local mortgage broker and refinance immediately for fear of missing the turn and the 'opportunity of a lifetime' to lock-in low rates. Unfortunately, just as retail equity investors appear to the be the smartest players in the room as they sell into strength, so the homeowner has now become conditioned by the Fed's central-planning and repression to expect rates to remain low - and QE3 to be implemented later in the year - and therefore will wait for the 'expected' lower rates rather than accept a periodically rising rate. Yet another unintended consequence that hints at the fact that should we see 'real' recovery (we know, but go with the thought experiment) then higher rates will act as a drag on a burgeoning mini-stimulus from refinancing and normalize us back to lower growth.
from Testosterone Pit.com:
Bring home the bacon, or the speck,
as it were, was the guiding principle for German Chancellor Angela
Merkel when she frolicked in China last week. But her pleas to get the
Chinese to buy the crappy bonds of debt-sinner countries in the Eurozone
fell on deaf ears. This week, US Secretary of State Hillary Clinton was
hobnobbing with the Chinese elite. It turned into a clash fest, and
instead of bringing home the bacon, she argued with the Chinese over
everything and the South China Sea.
Merkel was accompanied by seven ministers and a delegation of executives from EADS, subsidiaries Airbus and Eurocopter, Volkswagen (which sells nearly a third of its cars in China), Siemens, Thyssen-Krupp, SAP…. Three planes stuffed with Germany’s political and corporate elite. It wasn’t about human rights or Syria or the South China Sea, but about trade.
Days before her visit, it seeped out that Airbus was hoping for a mega contract of 100 planes. The official occasion was Airbus’s joint venture in Tianjin where they celebrated with Premier Wen Jiabao the assembly of the 100th plane—of the 114 planes Airbus sold in China in 2011, 36 had been assembled there. During the ten years Wen has been Premier, German exports to China have quintupled, and Chinese exports to Germany have quadrupled.
Read More @ TestosteronePit.com
Bring home the bacon, or the speck,
as it were, was the guiding principle for German Chancellor Angela
Merkel when she frolicked in China last week. But her pleas to get the
Chinese to buy the crappy bonds of debt-sinner countries in the Eurozone
fell on deaf ears. This week, US Secretary of State Hillary Clinton was
hobnobbing with the Chinese elite. It turned into a clash fest, and
instead of bringing home the bacon, she argued with the Chinese over
everything and the South China Sea.Merkel was accompanied by seven ministers and a delegation of executives from EADS, subsidiaries Airbus and Eurocopter, Volkswagen (which sells nearly a third of its cars in China), Siemens, Thyssen-Krupp, SAP…. Three planes stuffed with Germany’s political and corporate elite. It wasn’t about human rights or Syria or the South China Sea, but about trade.
Days before her visit, it seeped out that Airbus was hoping for a mega contract of 100 planes. The official occasion was Airbus’s joint venture in Tianjin where they celebrated with Premier Wen Jiabao the assembly of the 100th plane—of the 114 planes Airbus sold in China in 2011, 36 had been assembled there. During the ten years Wen has been Premier, German exports to China have quintupled, and Chinese exports to Germany have quadrupled.
Read More @ TestosteronePit.com
from Zero Hedge:
As unemployment (broad and youth) goes from the sublime to the ridiculous in the troubled nation, Reuters is reporting that tensions are rising – even among the Police themselves. “They make us fight our own brothers,”
one riot-policeman urged with regard the Greek police protesting
austerity cuts and preventing riot-police from leaving to secure other
demonstrations this weekend. The government plans to slash police pay
in a new round of spending cuts worth nearly EUR12bn over the next two
years, which the police, firefghter, and coast guards will be prtesting
later today in Athens. How soon before TROIKA demands 8 days a week
and 99% taxation – as the hair-trigger on the gun they are holding to
their own head becomes more and more sensitive.
Read More @ Zero Hedge
It
was the best of times, it was the worst of times. A dramatic beat by
the ADP jobs number at 201k vs expectations of 140k is the third month
in a row of beating expectations for jobs and the highest add of jobs in 5 months. QE-off? Good is bad? Well there is some bad is good in here too - the manufacturing industry only added 3000 jobs.
Perhaps, rather ironically, the rise in jobs is due to the election
providing a stimulus - someone has to do all that fact-checking and
empty-chair-lifting.
As unemployment (broad and youth) goes from the sublime to the ridiculous in the troubled nation, Reuters is reporting that tensions are rising – even among the Police themselves. “They make us fight our own brothers,”
one riot-policeman urged with regard the Greek police protesting
austerity cuts and preventing riot-police from leaving to secure other
demonstrations this weekend. The government plans to slash police pay
in a new round of spending cuts worth nearly EUR12bn over the next two
years, which the police, firefghter, and coast guards will be prtesting
later today in Athens. How soon before TROIKA demands 8 days a week
and 99% taxation – as the hair-trigger on the gun they are holding to
their own head becomes more and more sensitive.Read More @ Zero Hedge
ADP Jobs At 5-Month High, Beating Expectations For 3rd Month In A Row
It
was the best of times, it was the worst of times. A dramatic beat by
the ADP jobs number at 201k vs expectations of 140k is the third month
in a row of beating expectations for jobs and the highest add of jobs in 5 months. QE-off? Good is bad? Well there is some bad is good in here too - the manufacturing industry only added 3000 jobs.
Perhaps, rather ironically, the rise in jobs is due to the election
providing a stimulus - someone has to do all that fact-checking and
empty-chair-lifting.
from Gold Silver:
A Sunday Drive In My Tesla. This story is written in 4 parts:
Part 1. The Car Crash
Part 2. The Economic Crash
Part 3. The Cars
Part 4. Freedom and the Pursuit of Excellence
Part 1. The Car Crash
On Sunday evening, August 26th, I was in one of the most spectacular car accidents I have ever seen. I was driving my Tesla Roadster at 25-30 MPH on a tree-lined canyon road in the Santa Monica Mountains, about to round a slow blind corner. When suddenly, out from behind the trees came a speeding car skidding out of control. The corner was posted at 25 MPH…. the oncoming car was traveling at 50 or 60 MPH. It crossed the centerline of the road fully into my lane and was heading straight at me.
I veered toward the shoulder of the road and WHAM! The car hit me head on, pushing my car backwards 20 or 30 feet, and sheering the entire driver’s side of my car clean off.
The other car, and pieces of my car, continued traveling down the road behind me another 60-80 feet or so. You can clearly see the other driver’s skid marks running from my lane to the rear of his car.
The whole accident, from when I first heard and saw the oncoming car to the moment of impact, took less than a second. The moment of impact was the most intense, brutal, and violent experience of my life. I looked at the smoke coming out of the deflating air bag in front of me, unfastened my seat belt, and stepped out of the car through the area where my drivers side door used to be.
Read More @ GoldSilver.com
A Sunday Drive In My Tesla. This story is written in 4 parts:Part 1. The Car Crash
Part 2. The Economic Crash
Part 3. The Cars
Part 4. Freedom and the Pursuit of Excellence
Part 1. The Car Crash
On Sunday evening, August 26th, I was in one of the most spectacular car accidents I have ever seen. I was driving my Tesla Roadster at 25-30 MPH on a tree-lined canyon road in the Santa Monica Mountains, about to round a slow blind corner. When suddenly, out from behind the trees came a speeding car skidding out of control. The corner was posted at 25 MPH…. the oncoming car was traveling at 50 or 60 MPH. It crossed the centerline of the road fully into my lane and was heading straight at me.
I veered toward the shoulder of the road and WHAM! The car hit me head on, pushing my car backwards 20 or 30 feet, and sheering the entire driver’s side of my car clean off.
The other car, and pieces of my car, continued traveling down the road behind me another 60-80 feet or so. You can clearly see the other driver’s skid marks running from my lane to the rear of his car.
The whole accident, from when I first heard and saw the oncoming car to the moment of impact, took less than a second. The moment of impact was the most intense, brutal, and violent experience of my life. I looked at the smoke coming out of the deflating air bag in front of me, unfastened my seat belt, and stepped out of the car through the area where my drivers side door used to be.
Read More @ GoldSilver.com
ECB Releases SMP2.0 Aka Outright Monetary Transactions Details
The ECB has released the details of its SMP 2.0 program, aka the OMT program, which will be pari passu, unlike the SMP 1.0. The full details are a whopping 472 words. Furthermore, we hope that it is quite clear to Greece that if the ECB has bought Greek bonds under the new SMP 2.0 program instead of SMP 1.0, its debt would now be about €100 billion less.
by Brittany Stepniak, Wealth Wire:
Read More @ WealthWire.com
It’s no surprise that the Republicans
have tried to make our astronomical debt and eroding economy the
central issues in their 2012 convention campaign.
Yesterday – Tuesday, September 4 – the
Treasury Department officially announced that the gross debt of the
United States of America had reached $16 trillion.
At that time, The Weekly Standard reported the debt clock reflected a debt amount of $16,015,769,788,215.80.
This is the first time in our nation’s history that the debt has surpassed this monumental mark.
$5.4 trillion was added in the years
Obama was president; the calculation was made based on data from January
20, 2009 to September 3, 2012.
To get a better visual of just how
quickly our debt is rising, take a look at this chart showing debt
increases since the year 2000.
Senator Jeff Session, ranking member of the Senate Budget Committee,
remarked that we now have more government debt per person than Portugal,
Italy, Spain, or Greece. Session is quite concerned with how President
Barrack Obama is going to tackle this issue, especially with a budget
plan that would add another $66,000 in debt for every American household.Read More @ WealthWire.com
This Is Economic Death: Greek Unemployment Rises By 1% In One Month
The chart below needs no commentary, neither does what it represents. In May Greek unemployment, pre revision, was 23.1%.
It was subsequently revised higher to 23.5%, but this is merely to
make the jump to the June number more palatable. What was June? 24.4%. In other words, no matter how one looks at it, the unemployment rate rose by 1% in one month.
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