Gold World News Flash

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• “Buy Gold” Recommendation Reaches China
• Desperate for Oil, We’ll Drill More Land
• Asian Metals Market Update
• Richard Russell - Gold To Catch Fire and the Public Will Notice
• Martin Armstrong: Gold To $12,500
• In The News Today
• Gold Seeker Closing Report: Gold and Silver End Mixed After Hitting New Highs
• Can HyperInflation REALLY Hit the US?
• Canada’s Mortgage Monster?
• Big Oil Versus The Dangers of Nuclear Power
• “Buy Gold” Recommendation Reaches China
• Stagflation Causes More Damage Than Inflation And Promotes Gold!
• Silver update
• The Interest Rate Mega-Trend Ebook and Forthcoming Stocks Stealth Bull Market Update
• Ted Butler's address to last month's Phoenix conference
• Now maybe in a few years someone will ask Bernanke a question about gold
• How Likely is QE-Three?
• How & When, But More Importantly, Why?
• JPMorgan Holding 30,844 Ounces of Silver for Clients
• The entire Japan story is huge bullish for Gold and extremely bearish for all paper currencies certain to be debased further.
• Meanwhile Afterhours...
• The Dollar Will Collapse Within 3-4 Months
• Silver Price Must Hold Above 36.50 and Gold Price Above 1420
• Heeding the Irrational Market
• Aggressive Retirement Portfolio For the Next 3 Years
• Nevada to Ramp Up Mining Taxes?
• Exactly How Does This Turn Out?
• Gold Daily and Silver Weekly Charts - Blythe Strikes Back, La Reine de la Nuit
• 8 Hour Gold Update - 2:30 PM CDT
• Gold/Silver Ratio Stuck

“Buy Gold” Recommendation Reaches China Posted: 24 Mar 2011 06:02 PM PDT GoldSeek.com had the Reuters news report with the headline "China Adviser Says Beijing Should Buy More Gold."

Desperate for Oil, We’ll Drill More Land Posted: 24 Mar 2011 06:01 PM PDT In the essay below, Ross Moyer predicts that America's growing energy needs will force the exploitation of heretofore off-limits local regions such as the energy-rich Bakken Formation, which includes large swaths of North Dakota and Montana. He also expects physical gold to increasingly become the world's standard of value relative to fiat money, even if a gold standard itself has not taken root.

Asian Metals Market Update Posted: 24 Mar 2011 06:00 PM PDT The first quarter of the new decade has been great run for commodities. Option market covering seems to be over. It will be a technical trade. Yesterdays fall in gold and silver before the close is not a bear trend. If and only if the fall in gold and silver continues till Monday that will be in a short term bear phase, else dips are nothing but an investment opportunity.

Richard Russell - Gold To Catch Fire and the Public Will Notice Posted: 24 Mar 2011 05:58 PM PDT With gold and silver on the move, the Godfather of newsletter writers Richard Russell had this to say in his latest commentary, "There is only one certainty regarding paper money -- the longer you hold it, the less it will buy in terms of real goods or real money -- gold. But there's a big difference between the current precious metals bull market and the bull market of the 1970s. The 1970 bull market drew tremendous interest (I was there). Everybody I knew (even the gold haters) were watching that bull market with keen interest, particularly during the wild "blow off" days of the late 1970s, when silver was rocketing higher -- rising every day by limit up." This posting includes an audio/video/photo media file: Download Now

Martin Armstrong: Gold To $12,500 Posted: 24 Mar 2011 04:52 PM PDT Martin Armstrong just wrote a paper on gold titled, "How and When." My response to this article is why? Why in the world, if you believe that the gold price can go to $5000 and $12,500, as the article says, do you give a damn about the next 90 days? You must realize that the economic and political damage is already done. You must realize that the mountain of OTC derivative paper is not going away. You must realize that all the old legacy assets (broken OTC derivatives) demand to be adjusted at each market turn in order to maintain any semblance that they are serious contracts. You must realize that this adjustment means adding on new OTC derivatives. You must realize that this means the mountain of OTC derivative weapons of mass financial destruction can only grow. You must realize that it is not whether or not QE will continue, it is what it already has done to the Western economies that much higher gold prices will reflect. You must realize this is not a business problem, but rather a debt problem as it applies to the gold price. You must realize the monumental change in the Middle East is NOT positive for the West in any manner, shape or form. You must realize that the change in the Middle East is from some form of government to chaos. You must realize that the beneficiaries of chaos in the Middle East are Iran and Russia. You must realize that the main product of the establishment of a no fly zone in Libya is to benefit the Rebels. You must realize that the rebels are an unknown factor in Libya. You must realize that a second product of the no fly zone is greater hatred in the Middle East for all things West. You must realize that the peak production of energy is behind us. You must realize that the production of energy in chaos will be less than under some form of rule. You must realize that this combination of monumental Middle East change and peak oil means peak oil is no longer a consideration 10 to 15 years from now, it is now. You must realize that the Angels (gold prices) are not simple talk but rather a method used by the great market maven, Jesse Livermore. More Here.. The wrecked General Electric nuclear reactors contained enough radioactive, highly poisonous fuel to kill every person on Earth about 10 times.   This posting includes an audio/video/photo media file: Download Now

In The News Today Posted: 24 Mar 2011 04:03 PM PDT Thought For The Evening Increases in margin rates such as what occurred in silver today will continue. By the time gold is over $2000 and silver is over $75 both margin rates will go to cash only. Jim Sinclair's Commentary The protestors won in Egypt? You have to be kidding. Egypt to protest against anti-protest law The new decree-law issued by the cabinet yesterday draws the ire of activists and labourers who plan to take their objections to the street in massive protests on Friday Lina El-Wardani , Thursday 24 Mar 2011 The Egyptian cabinet approved yesterday a decree-law that criminalises strikes, protests, demonstrations and sit-ins that interrupt private or state owned businesses or affect the economy in any way. The decree-law also assigns severe punishment to those who call for or incite action, with the maximum sentence one year in prison and fines of up to half a million pounds. The new law, which still needs to be approved by the Supreme Council of the Armed Forces, will be in force as long as the emergency law is still in force. Egypt has been in a state of emergency since the assassination of former president Anwar Sadat in 1981. Since former president Hosni Mubarak stepped down on 11 February, Egypt has witnessed escalating nationwide labour strikes and political protests. Amongst those protesting have been university students, political activists, railway workers, doctors, pharmacists, lawyers, journalists, pensioners and the police force. Many labourers have expressed their shock at the decree. "We really had hopes that the new government will support us and look into our demands. We expected them to say we have all of your legal demands on our desks and there is a timeline of a month or two within which they will be achieved," said Ali Fotouh, a driver in the public transportation sector. More… Jim Sinclair's Commentary Compliments of CIGA Ed.

Gold Seeker Closing Report: Gold and Silver End Mixed After Hitting New Highs Posted: 24 Mar 2011 04:00 PM PDT Gold climbed almost $10 to a new all-time high of $1447.34 by late morning in New York, but it then fell back off sharply in the last hour of trade and ended with a loss of 0.22%. Silver climbed over a dollar to a new 31-year high of $38.15 before it also fell back off, but it still ended with a gain of 0.81%.

Can HyperInflation REALLY Hit the US? Posted: 24 Mar 2011 03:09 PM PDT Can HyperInflation REALLY Hit the US? I know that many deflationists believe that we cannot experience hyperinflation in the US due to our obscene debt levels. The belief here is that all the money thrown into the US financial system will be swallowed by another round of debt deflation. The problem with this belief is that it doesn't understand how currency crises work. Inflation occurs when a currency falls in value relative to other currencies. And as noted by other astute commentators, hyperinflation occurs when a currency is abandoned all together. On that note, I would like to refer some extraordinary research from Bill King of RamseyKing Securities. King recently presented a portion of Niall Ferguson's book, "The Ascent of Money" regarding what REALLY happened in Weimar Germany (King's emphasis added in bold). Yet it would be wrong to see the hyperinflation of 1923 as a simple consequence of the Versailles Treaty. That was how the Germans liked to see it, of course…All of this was to overlook the domestic political roots of the monetary crisis. The Weimar tax system was feeble, not least because the new regime lacked legitimacy among higher income groups who declined to pay the taxes imposed on them. At the same time, public money was spent recklessly, particularly on generous wage settlements for public sector unions. The combination of insufficient taxation and excessive spending created enormous deficits in 1919 and 1920 (in excess of 10 per cent of net national product), before the victors had even presented their reparations bill… Moreover, those in charge of Weimar economic policy in the early 1920s felt they had little incentive to stabilize German fiscal and monetary policy, even when an opportunity presented itself in the middle of 1920. A common calculation among Germany's financial elites was that runaway currency depreciation would force the Allied powers into revision the reparations settlement, since the effect would be to cheapen German exports. What the Germans overlooked was that the inflation induced boom of 1920-22, at a time when the US and UK economies were in the depths of a post-war recession, caused an even bigger surge in imports, thus negating the economic pressure they had hoped to exert. At the heart of the German hyperinflation was a miscalculation. So Weimar was really the product of the financial elite engaging in insane monetary policies using public funds without care and trying to devalue the currency in order to inflate away the debts. Gee… what major country is engaging in similar practices today? Speaking of which, the US Dollar is imploding. As you can see, the US Dollar has taken out its multi-year trendline. The markets have noted this and already sense that it's the END GAME for the US currency. Indeed, you can sense the coming inflationary collapse as inflation hedges explode higher across the board:   Both Gold and Silver will perform well in the coming months. However, their performance will pale compared to other, less well know inflation hedges. Why? Everyone knows that Gold and Silver are the most obvious inflation hedges out there. And to be blunt, anyone who invests in these two assets will likely do very well in the coming months as inflation erupts in the US. However, to make truly ENORMOUS gains from inflation you need to find the investments that are off the radar… investments that the rest of the investment world hasn't discovered yet. I'm talking about investments that own assets of TREMENDOUS value that are currently priced at absurdly low valuations: the sorts of assets that larger companies will pay obscene premiums to acquire. I detail the three best investments I know that fit these criteria in my new Special Report the Inflationary Storm Pt 2 which I just released to the public four weeks ago. Already all THREE of these investments are up 7%, 7%, and 9%%. That's in just ONE month! And I'm only making 250 copies of this second report available to the public. Any more than that and we'll blow the lid off these investments too quickly. As I write this, there are only a few copies left. And I fully expect we'll sell out shortly. So if you want to pick up a copy of the Inflationary Storm Pt 2 (including the names, symbols, and how to buy my three NEWEST extraordinary inflation hedges) you better move quickly. To reserve a copy… CLICK HERE NOW!!! Good Investing! Graham Summers

Canada’s Mortgage Monster? Posted: 24 Mar 2011 01:49 PM PDT Via Pension Pulse. Chris Sorensen And Jason Kirby of Maclean's report, The CMHC: Canada’s mortgage monster: David LePoidevin isn’t the first person to suggest Canada’s roaring housing market is headed for a U.S.-style crash. But he is a rare breed of money manager for daring to point a finger at the Canada Mortgage and Housing Corporation, the country’s biggest mortgage insurer. In a fall 2009 note to his clients, LePoidevin questioned what was underpinning the country’s skyrocketing home prices, aside from rock-bottom interest rates. “The stock market was sure not providing huge capital gains to the masses,” he wrote. “Did the banks all of a sudden open up the lending spigots? In fact banks have actually reduced the number of their mortgages held from the peak of third quarter of 2008. The smoking gun is the CMHC and its securitization policies.”   As mainstream economic commentary in Canada goes, it was damning stuff. And it provided ammunition to critics who argue the Crown corporation’s policies have inflated a housing bubble. The CMHC is arguably the most influential player in Canada’s $1-trillion housing market. Its main function is to provide mortgage insurance for prospective homeowners who put less than 20 per cent down on their houses, protecting the banks in the event of defaults. The CMHC also helps to spread risk by finding investors to buy CMHC-insured mortgages that have been pooled together into so-called mortgage-backed securities. All of this is guaranteed by the government.   Almost immediately, LePoidevin’s bosses at National Bank leapt to the CMHC’s defence. In a letter to an Ottawa newspaper that had referred to the commentary, co-chief executive Ricardo Pascoe said the Vancouver portfolio manager’s views were “personal” and “do not reflect the views of National Bank Financial Group.” When reached by Maclean’s, LePoidevin declined to talk about the public rebuke or the CMHC in general. A National Bank spokesperson justi?ed its actions, saying the company “felt that the commentary was treading on social and political issues.”   The apparent unwillingness of the country’s sixth-largest bank to challenge the CMHC is curious given the role similar U.S. institutions Fannie Mae and Freddie Mac—quasi-government agencies that securitized mortgages—played in the U.S. housing crash. But it’s far from unusual. Several other critics, including economists, realtors, lawyers and analysts contacted by Maclean’s, say they have also been the target of attack. One bank economist who once publicly raised fears about a housing bubble says he didn’t dare openly criticize the CMHC because of the agency’s reputation for snuffing out dissent—an allegation the CMHC denies. The economist spoke on the condition his name not be used.   Even worse, the public knows next to nothing about what lurks inside the CMHC’s books, aside from the smattering of details it releases in its annual report. And, unlike every other major insurance provider in the country, the CMHC doesn’t answer to Canada’s top financial services regulator. It falls under an amalgam of government acts and departments, including Finance and Human Resources, while also working with the Bank of Canada. Yet on specific decisions that dramatically loosened mortgage lending rules last decade, CMHC officials have testified they did so on their own with the approval and oversight of the CMHC’s board of directors—a board that includes a political consultant, real estate developers, a small-town lawyer and even the owner of a plumbing company—though not one single economist or recognizable financial services professional.   It all raises troubling questions about the agency, its oversight and, ultimately, the health of the country’s frothy housing market, a key driver of the Canadian economy. And, as LePoidevin found out the hard way, asking hard questions seldom yields satisfactory answers.   Since taxpayers, through the CMHC, and not the banks are ultimately on the hook in the event of a housing crash, a growing chorus of critics has been calling for more transparency and oversight, if not outright reform. Stephen Jarislowsky, a billionaire Montreal investor, says home prices are likely overvalued by as much as 20 per cent in some Canadian markets thanks to CMHC policies that encouraged banks to lend far too much money to people to whom they shouldn’t have. The core problem, he argues, is that promoting home ownership makes for good politics in Canada, if not always sound economic policy.   “The CMHC is influenced by the political process, just like [Fannie Mae and Freddie Mac] were in the United States,” says Jarislowsky. He notes the average debt-to-income ratio of Canadian households recently surpassed that of the U.S. for the first time in 12 years. “The political folks are guaranteeing mortgages that the banks might never have made if they had to keep them on their own books,” he says.   At the end of 2009, the CMHC insured roughly $473 billion worth of mortgages (it expected that figure to rise to $519 billion last year, though updated figures haven’t been released), which is nearly the entire mortgage insurance market in the country. The CMHC also assists the financial sector by buying pooled mortgages and reselling them to investors as bonds, giving banks and other institutions an immediate source of cash that they can re-lend. As of 2009, the CMHC had securitized $300 billion worth of mortgages. So critical is this function that Ottawa relied on the agency to prop up the country’s big banks during the financial crisis, giving the CMHC permission to buy $66 billion worth of mortgages.   It’s a familiar-sounding story to American ears. “The Canadian government mortgage apparatus echoes uncannily our experiences down here with Fannie and Freddie” says Jim Grant, author of the widely read Grant’s Interest Rate Observer newsletter. “CMHC has distorted the housing market by making homes, especially ones that are on the pricier end of the spectrum, more affordable and encouraged a lot of people to get in over their heads.”   Grant and other critics argue the CMHC’s balance sheet looks strikingly similar to both Fannie and Freddie if you compare the mortgages the agency insures against its equity. Using the CMHC’s 2010 forecasts, it insures $519.1 billion in mortgages against $9.9 billion in equity, which works out to around 1.9 per cent (although the CMHC says it has another $6.7 billion in “unearned” premiums that could be used toward future claims). By comparison, in 2007, at the peak of the bubble, Fannie Mae backed up US$2.7 trillion of mortgage-backed securities with US$40 billion of capital, or 1.5 per cent equity against its overall exposure. But the CMHC says its capital levels are double what the Office of the Superintendent of Financial Institutions requires of mortgage insurers (though the CMHC is not regulated by the OFSI). But such assurances in the absence of transparent disclosure offer limited comfort. As C.D. Howe researcher Finn Poschmann wrote in a recent report: “Parliament and the voters to whom it answers have no formal documentation of the way these exposures are calculated or managed.”   What bothers Grant is that the CMHC’s government-backed guarantees encourage banks to feel they have less to lose if loans go bad. “The risk has been shifted, rather than reduced, from the stockholders and depositors of the big Canadian banks to the Canadian taxpayer,” he says. And if house prices fall and borrowers get into trouble, the ripples would run far and wide. “A sharp break in Canadian house prices would inflict terri?c damage to consumer con?dence, would hurt the Canadian labour market, and ultimately produce a lot of the unpleasant results that have been America’s burden to bear since 2007.”   The CMHC argues such concerns are overblown. It points out that the Canadian mortgage system is fundamentally different than in the U.S. That’s because mortgage interest is not tax-deductible, a relatively small number of mortgages are securitized, and lenders can generally go after homeowners who don’t make their payments. The CMHC also points to Canada’s low rate of mortgage arrears, currently less than one per cent. Finally, the industry never got swept up in the subprime lending trend, the CMHC says. “We don’t have those products in Canada,” says Pierre Serré, the CMHC’s vice-president of insurance product and business development. “And if we did, CMHC certainly did not insure them.” Lending weight to the CMHC’s claims, a 2009 IMF report called Canada’s residential mortgage markets “boring but effective.”   Canadian lenders didn’t go overboard with the sorts of gimmicky mortgage products—loans with low initial “teaser” rates or so-called NINJA loans (no income, no job or assets)—that got Americans into so much trouble. But it’s not like they shied away from taking risks. For two years beginning in 2006, the CMHC offered insurance on mortgages with amortization periods of up to 40 years, nearly double the traditional 25-year period, and loans with zero down payments. The products were later reined in by Ottawa after the U.S. housing market tanked.   The CMHC dove into such high-risk products largely without supervision. While the government had previously relaxed conditions for guaranteeing mortgage insurance as part of a plan to introduce more private sector competition, it was the CMHC’s management and board that ultimately made the decision to go to 40-year amortization periods. In the same way, in 2007, the CMHC introduced a program for self-employed Canadians who have difficulty documenting their earnings to nonetheless obtain mortgage insurance by “stating” their income. While the program was restricted to borrowers with good credit ratings, one mortgage broker told Maclean’s self-employed Canadians were able to get much larger mortgages than those in the same field who had documented incomes. Then, a year ago, the CMHC backtracked and significantly tightened its rules on stated-income mortgages.   “We’re allowed to operate and make decisions with regards to mortgage insurance products and policies within the [government's] guarantee, and when we do so we advise the government of any changes,” says Peter De Barros, a spokesperson for the CMHC. Still, the move to riskier mortgage products drew the ire of then-Bank of Canada governor David Dodge, who sent a letter to CMHC chief executive Karen Kinsley in 2006 warning about the dangers of throwing fuel on a hot housing market. “A home purchaser is able to borrow at very low interest rates because you and I as taxpayers essentially guarantee that mortgage,” Dodge said during an interview earlier this year on Business News Network. “So it’s not at all unreasonable for us as taxpayers to say, ‘Look, Mr. Borrower, you’ve got to have an equity stake in this as well, so if things go really bad it’s not all on the Canadian taxpayer—part of it is on you.” (Dodge declined to be interviewed for this story.)   Critics say that, given what happened in the U.S., it’s irresponsible to not have someone watching over the CMHC. “They are the only major ?nancial institution in Canada not regulated by OSFI,” says Ian Lee, an assistant professor at Carleton University’s Sprott School of Business and a former bank manager. “Housing is so huge and the consequences are just so large. It’s not like they’re deciding what to do about the price of ballpoint pens.” So how much risk have taxpayers been exposed to? The CMHC doesn’t reveal specific data about the credit exposure that it has taken on, other than to say it is manageable and in line with internal guidelines. As for the question of whether the CMHC’s policies could contribute to a housing crash, the agency says there’s no reason for Canadians to lose sleep. It says more than half of CMHC-insured mortgages have a loan-to-value ratio of less than 80 per cent based on the value of the original loan, and that the average equity in a CMHC-insured property is 45 per cent. “The mortgages are getting paid down—as a matter of fact, we see that about half of our folks made extra payments, more than just the minimum required principal payments,” says Serré, adding that rising home prices have also helped improve the debt picture.   But such aggregate figures don’t necessarily provide an accurate snapshot of how homeowners are faring, according to Poschmann at C.D. Howe. Important questions remain unanswered—like what is the geographic breakdown of its mortgages? Of those people with lower equity in their homes, what is the size of their mortgages? What classes of loans are they? What are their terms? “You can’t come up with an independent assessment of exposures based on the information they publish,” says Poschmann. “You can manage risks better with oversight and daylight, but right now we have pretty opaque books.”   While the CMHC says it has a sophisticated automated system to check creditworthiness of borrowers and property values, its biggest private sector competitor (which also has its mortgage insurance guaranteed by taxpayers, albeit only up to 90 per cent) nevertheless suggested during a 2007 hearing of the Senate banking committee that more than a third of all mortgages insured by the CMHC could be considered risky. Winsor Macdonell, the vice-president and general counsel of Genworth Financial, told the committee he assumed the CMHC’s portfolio looks similar to Genworth’s given that both provide mortgage insurance for the entire Canadian market. “When I talked about our portfolio, 36 per cent are people with low or poor credit,” he said. “Those are the people who are at risk.” Genworth declined to talk to Maclean’s for this story.   Serré declined to comment directly on Macdonell’s remarks. “I’m not exactly sure what low or poor credit is,” he says. “But I want to make clear that our mandate is not to get people into home ownership, our mandate is to provide the housing of choice. The last thing we want, as a government insurer, is to get people in a position where they can’t manage their debt.” For the sake of Canada and its fragile economic recovery, let’s hope he’s right. Wow! Where do I begin? It was only a week ago when I delved into the topic of the Canada bubble and now another bombshell article from Maclean's questioning the practices of the Canada Housing Mortgage Corporation (CMHC). (Track daily news on the Canadian housing bubble on canadabubble.com and greaterfool.ca). First, I used to work at the National Bank of Canada. I never met Ricardo Pascoe but I heard he's not exactly the type of guy you want to piss off. I can only imagine the phone call Mr. LePoidevin got after he wrote that stinging memo, probably telling him to "zip it". The CMHC is extremely important to Canadian banks. In October 2009, Murray Dobbin wrote a commentary, Why Canada's Housing Bubble Will Burst. It was way too political for my taste, blaming "Harper Conservatives," (Liberals are as much to blame) but Mr. Dobbin did make a good point on banks passing off risk: The banks themselves have taken on virtually no new risk. According to CMHC numbers in the two years from the beginning of 2007 to January 2009, Canadian banks increased their total mortgage credit outstanding by only 0.01 per cent. Fully 90.5 per cent of all growth in total Canadian mortgage credit outstanding since 2007 has been accounted for by Mortgage Backed Securities. Of course, the banks have no interest in saying no if you have qualified for a securitized CMHC loan -- because they bear no risk if you default.   If that sounds like sub-prime mortgages, it should. Sub-prime is any loan below prime. If a bank refuses you a loan, and CMHC gives you one, the loan is sub-prime. As Lepoidevin says in his warning letter, "Every single U.S. lender specializing in sub-prime has gone bankrupt. The largest sub-prime lender in the world is now the Canadian government." But is it right to compare the CMHC to US agencies and subprime lenders? No, but let's go back to that Maclean's article above. The CMHC says "more than half of CMHC-insured mortgages have a loan-to-value ratio of less than 80 per cent based on the value of the original loan, and that the average equity in a CMHC-insured property is 45 per cent." In other words, a sizable portion of CMHC-insured mortgages have a loan-to-value ratio greater than 80 per cent based on the value of the original loan. Moreover, the CMHC does not publish the weighted loan-to-value ratio of their mortgage book pre and post 2007. As for the "average equity in a CMHC-insured property being 45 per cent," that too doesn't tell us much. You have to take the median and separate out CMHC-insured properties insured pre and post 2007. Keep in mind, there are a lot of young two-income couples who bought homes in the last five years that they were able to purchase because they took out huge mortgages (insured by the CMHC). If one of them loses their job, they're going to be in big trouble. I'm not worried about two doctors who have a guaranteed high income taking out a huge mortgage (even though I think it's stupid). I'm more worried about some salesperson making a lot of money, taking out a huge mortgage thinking they're going to be able to make the payments in the future because they'll continue making a lot of money. If they lose their job, they're cooked. There is no way they're going to find another job that pays them as much. Just look at what happened in the US. The Maclean's article made some mistakes too, citing some Carleton professor who said the CMHC is the "only major financial institution in Canada not regulated by OSFI." This is false. The two biggest Crown corporations in Canada, the Canada Pension Plan Investment Board (CPPIB) and the Public Sector Pension Plan Investment Board (PSPIB) are not regulated by OSFI even though OSFI regulates private pension plans. Why is this the case? It's all about governance. These public pension investment boards want to operate at "arms-length" from the government. While I agree with this "arms-length" approach, best governance standards around the world have the same entity in charge of oversight for private pension plans also in charge of oversight at public pension plans. OSFI isn't perfect but they have qualified people who can ask some tough questions to these financial institutions and assess the risks they're taking. Whether or not OSFI wants this responsibility is another matter. Other large financial Canadian Crown corporations like the Business Development Bank of Canada (BDC) and Export Development Canada (EDC) are also not regulated by OSFI, however, they fall under the Financial Administration Act and are subject to a lot more public scrutiny than most Crown corporations. The truth is there is no perfect governance anywhere, and all Crown corporations have secrets they don't want to share publicly. The problem is t

Big Oil Versus The Dangers of Nuclear Power Posted: 24 Mar 2011 01:45 PM PDT As oil prices soar and countries think twice about expanding nuclear power, we should be careful about where to point the finger, says Japan’s trauma following the partial meltdown of nuclear reactors in Fukushima has once again brought to the world’s attention the dangers of nuclear power. From the start, it was clear that a broad advocacy of nuclear energy is bad ecology. Splitting the atom (or worse, fusing atoms) unleashes intense heat and radiation and produces poisonous waste that lasts for up to 10,000 years or more

“Buy Gold” Recommendation Reaches China Posted: 24 Mar 2011 01:30 PM PDT GoldSeek.com had the Reuters news report with the headline "China Adviser Says Beijing Should Buy More Gold." Now, of course, we are all saying, "This is exactly what The Incomparable Mogambo (TIM) has been advising the Chinese to do, and what everyone should do, too, and buy silver, too!" which rhymes, so you know that it must be true, which also rhymes, although, in describing it, it doesn't, sort of like the Heisenberg Uncertainty Principle for no particular reason, which just shows how Very Freaked Out (VFO) I am by the satanic Federal Reserve continuing to create trillions of dollars even as inflation in food and energy prices is soaring. Well, these Chinese dudes never admit that they are taking my Fabulous Mogambo Advice (FMA) to use their surplus foreign reserves and buy up as much gold and silver as they can, so as to use it to institute a gold-standard monetary system as a prerequisite to making the yuan stronger by virtue of its gold backing, which will make imports cost...

Stagflation Causes More Damage Than Inflation And Promotes Gold! Posted: 24 Mar 2011 01:00 PM PDT When inflation hits a healthy economy such as China it has an entirely different impact then it does on today's developed world. When we hear the word inflation, the mind turns back to textbooks on economic principles and sees solutions that did apply in the past but do not apply today. That is in the developed world. These solutions will work still in China where incomes are soaring, GDP growth is in double figures and money supply needs to expand to accommodate tremendous economic development. In the developed world where inflation has passed the poor levels of economic growth and interest rates, the scene is totally different.

Silver update Posted: 24 Mar 2011 12:53 PM PDT [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] ...

The Interest Rate Mega-Trend Ebook and Forthcoming Stocks Stealth Bull Market Update Posted: 24 Mar 2011 12:36 PM PDT Dear Reader The New UK Interest Rate Mega-Trend 85 page ebook is now complete and available for download. The Ebook comprises of 4 chapters that contain full analysis and concluding forecasts for UK economy, inflation and interest rates, with the fourth chapter focusing on the implications of interest rate rises for society, housing, gold, silver, bonds and the stock market and comprises 4 chapters. [LIST] [*]UK Economy [*]UK Inflation [*]UK Interest Rates [*]Implications of Rate Rises [/LIST] Download Now- The Interest Rate Mega-Trend Ebook (PDF 2.2meg), the only requirement is a valid email address. The Stocks Stealth Bull Market My next in depth analysis of the stocks stealth bull market trend expectations for the remainder of 2011 is nearing completion, as always my primary motivation is with regards my own portfolio and trading positions, so I have to get it right else I WILL LOSE MONEY! I anticipate this work to be completed and formatted for publis...

Ted Butler's address to last month's Phoenix conference Posted: 24 Mar 2011 12:08 PM PDT 8:07p ET Thurday, March 24, 2011 Dear Friend of GATA and Gold (and Silver): Silver market analyst Ted Butler, whose many years of tireless research and advocacy brought the silver price suppression scheme to light, doesn't make too many public appearances. So his address to Cambridge House's Phoenix Resource Investment Conference and Silver Summit last month may be of special interest. Butler describes his efforts to get the attention of the U.S. Commodity Futures Trading Commission and his initial hopes for the CFTC's new chairman, Gary Gensler. Butler concludes: "I have been asked if I have finally given up on Gensler doing anything about the silver manipulation and the enactment of legitimate speculative position limits. In a word: No, I have not given up on him. The pace to legitimate position limits in silver has been agonizingly slow. But at least there is a pace, something that was lacking until he became chairman less than two years ago. Yes, there is an ongoing silver investigation by the Enforcement Division of the CFTC, now in its third calendar year, and that is shameful. But you have to put things in perspective. A manipulation that has persisted for decades must be given time to end. I sense Gensler is on the right path. Also, I must acknowledge the courageous role of Commissioner Bart Chilton over the recent past. There is no doubt in my mind that Gensler and Chilton are dedicated public servants whose primary interest is in making our markets more transparent and fair. But they won't succeed without our help." Butler's address is headlined "Silver Review and Outlook" and you can find it at GoldSeek's companion site, SilverSeek, here: http://news.silverseek.com/SilverSeek/1300983928.php And at 24hGold here: http://www.24hgold.com/english/news-gold-silver-silver-review-and-outloo... CHRIS POWELL, Secretary/Treasurer Gold Anti-Trust Action Committee Inc. ADVERTISEMENT Prophecy Resource Spins Off Platinum/Palladium Venture: World-Class PGM Deposit in Yukon Company Press Release, January 18, 2011 VANCOUVER, British Columbia -- Prophecy Resource Corp. (TSX-V:PCY)and Pacific Coast Nickel Corp. announce that they have agreed that PCNC will acquire Prophecy's Nickel PGM projects by issuing common shares to Prophecy. PCNC will acquire the Wellgreen PGM Ni-Cu and Lynn Lake nickel projects in the Yukon Territory and Manitoba respectively by issuing up to 550 million common shares of PCNC to Prophecy. PCNC has 55.7 million shares outstanding. Following the transaction: -- Prophecy will own approximately 90 percent of PCNC. -- PCNC will consolidate its share capital on a 10 old for one new basis. -- Prophecy will change its name to Prophecy Coal Corp. and PCNC will be renamed Prophecy Platinum Corp. -- Prophecy intends to distribute half of its PCNC shares to shareholders pro-rata in accordance with their holdings. Based on the closing price of the common shares of PCNC on January 17, $0.195 per share, the gross value of the transaction is $107,250,000. For the complete announcement, please visit: http://prophecyresource.com/news_2011_jan18.php Join GATA here: An Evening with Bill Murphy and James Turk Sponsored by Deutsche Edelmetall-Gesellschaft Friday, April 29, 2011 Hofbrauhaus, Munich, Germany http://www.goldmoney.com/munich-2011-april-29.html Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or a colorful GATA T-shirt: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: http://www.goldrush21.com/ Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: http://www.gata.org/node/16 ADVERTISEMENT Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, Extending the Mineralization of the Southwest Vein on the Property Company Press Release, October 27, 2010 VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include: -- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres. -- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres. -- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre. Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface. "The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest." For the company's full press release, please visit: http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf

Now maybe in a few years someone will ask Bernanke a question about gold Posted: 24 Mar 2011 11:44 AM PDT Bernanke to Hold Press Briefings After FOMC Rate Votes By Scott Lanman Bloomberg News Thursday, March 24, 2011 http://www.bloomberg.com/news/2011-03-24/bernanke-to-hold-press-briefing... WASHINGTON -- Federal Reserve Chairman Ben S. Bernanke will hold press conferences after policy meetings four times per year in one of his biggest efforts to improve the central bank's connections with a skeptical public. The briefings will be broadcast on the Fed's website and coincide with the Federal Open Market Committee meetings when officials update economic projections. The first will be April 27 at 2:15 p.m. Washington time, the Fed said today in a statement. The FOMC's statement will be released at 12:30 p.m. on the days when Bernanke is speaking, instead of the usual time of 2:15 p.m., the central bank said. The announcement brings the Fed in line with other central banks and marks the most significant change to its communication policy since 2007. Bernanke has spent almost five months countering criticism from Republican lawmakers over record monetary stimulus. A majority of Americans said in a December poll that the Fed should either be brought under tighter political control or abolished outright. It's important to the Fed that "they be seen as transparent, that they're not hiding secrets and that they head off any criticism from Congress," Diane Swonk, chief economist at Mesirow Financial Inc. in Chicago, said in an interview with Bloomberg Television. ... Dispatch continues below ... ADVERTISEMENT The Gold Standard Now: It Can Work Today a dollar is worth 80 percent less than it was 40 years ago, and less than 5 percent of its value a hundred years ago. We deserve a dollar that is as good as gold, a dollar that will hold its value from year to year so we can be financially secure and our economy can generate more and better jobs. For most of America's history, our dollar was literally as good as gold. But on August 15, 1971, our politicians destroyed the link between gold and the dollar. They destroyed the foundations of our economic system. A new Internet site, TheGoldStandardNow.org, provides news and cutting-edge analysis about this most important issue and explains how the gold standard worked in the past and how it can work in the future. Visit us today: http://www.thegoldstandardnow.org/about/137-welcome-newsmax Fed Vice Chairman Janet Yellen led a group of officials tasked in November with reviewing practices to determine where to draw the line between confidential policy discussions and public comments. "The introduction of regular press briefings is intended to further enhance the clarity and timeliness of the Federal Reserve's monetary policy communication," the central bank said in its statement. "The Federal Reserve will continue to review its communications practices in the interest of ensuring accountability and increasing public understanding." The other press briefings this year will be June 22 and Nov. 2, both following FOMC meetings when governors and regional Fed presidents present updated economic forecasts. Bernanke will hold the briefings to discuss the projections and "to provide additional context for the FOMC's policy decisions," the Fed said. The timing of the first briefings will give Bernanke a chance to clarify or elaborate on any decisions on completing the $600 billion of Treasury purchases begun in November in an effort to boost growth and reduce unemployment. The Fed is scheduled to finish the purchases in June; Bernanke hasn't said what the central bank will do after that. Bernanke, 57, had been the only head of a Group of Seven nations central bank not to give press conferences to explain actions and projections. He had previously relied mainly on speeches, congressional testimony and occasional interviews to convey his messages. European Central Bank President Jean-Claude Trichet and Bank of Japan Governor Masaaki Shirakawa each hold one after every policy meeting, while Bank of England Governor Mervyn King speaks once a quarter. Bank of Canada Governor Mark Carney also holds regular briefings. The Fed, which began announcing its interest-rate decisions in 1994, undertook its broadest review of communications in three years as officials approved the $600 billion monetary stimulus that sparked backlash from some politicians and foreign governments, who said the move risked inflation and asset-price bubbles. In October, central bankers, in a special videoconference meeting, considered whether Bernanke should hold regular press conferences and whether the Fed should adopt a numerical inflation or price-level objective, the Fed said in November. Bernanke indicated Feb. 3 that the central bank was leaning toward starting press conferences, saying officials were "very seriously" considering the move. Policy makers had to weigh "valuable" transparency against the risk of "unnecessary volatility" in financial markets from remarks being "misinterpreted," he said in a question-and-answer session at the National Press Club. The last broad review of communications in 2006-07 focused on how to give the public more information on policy objectives. Before that, Bernanke and some other officials advocated adopting a numerical inflation target, and others, including former Vice Chairman Donald Kohn, said they were more skeptical. Ultimately the Fed decided to double the frequency of published economic forecasts to four times a year and add a third year to its projections. The Fed updated its economic-projection policy in 2009, adding longer-run forecasts for inflation, economic growth and joblessness to give the public a better idea of the levels officials view as consistent with legislative mandates for stable prices and maximum employment. * * * Join GATA here: An Evening with Bill Murphy and James Turk Sponsored by Deutsche Edelmetall-Gesellschaft Friday, April 29, 2011 Hofbrauhaus, Munich, Germany http://www.goldmoney.com/munich-2011-april-29.html Support GATA by purchasing gold and silver commemorative coins: https://www.amsterdamgold.eu/gata/index.asp?BiD=12 Or by purchasing a colorful GATA T-shirt: http://gata.org/tshirts Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009: http://gata.org/node/wallstreetjournal Or a video disc of GATA's 2005 Gold Rush 21 conference in the Yukon: http://www.goldrush21.com/ Help keep GATA going GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at: http://www.gata.org To contribute to GATA, please visit: ADVERTISEMENT Prophecy Resource Spins Off Platinum/Palladium Venture: World-Class PGM Deposit in Yukon Company Press Release, January 18, 2011 VANCOUVER, British Columbia -- Prophecy Resource Corp. (TSX-V:PCY)and Pacific Coast Nickel Corp. announce that they have agreed that PCNC will acquire Prophecy's Nickel PGM projects by issuing common shares to Prophecy. PCNC will acquire the Wellgreen PGM Ni-Cu and Lynn Lake nickel projects in the Yukon Territory and Manitoba respectively by issuing up to 550 million common shares of PCNC to Prophecy. PCNC has 55.7 million shares outstanding. Following the transaction: -- Prophecy will own approximately 90 percent of PCNC. -- PCNC will consolidate its share capital on a 10 old for one new basis. -- Prophecy will change its name to Prophecy Coal Corp. and PCNC will be renamed Prophecy Platinum Corp. -- Prophecy intends to distribute half of its PCNC shares to shareholders pro-rata in accordance with their holdings. Based on the closing price of the common shares of PCNC on January 17, $0.195 per share, the gross value of the transaction is $107,250,000. For the complete announcement, please visit: http://prophecyresource.com/news_2011_jan18.php

How Likely is QE-Three? Posted: 24 Mar 2011 11:34 AM PDT ...or, "Is That Your Retirement Account You're Holding On To So Tightly? Or Are You Just Happy To See Me?" Said The Man From The Government) So back in September 2008—in the throes of the Global Financial Crisis—the Federal Reserve under its chairman, Ben Bernanke, unleashed what was then known as "Quantitative Easing". Sure: It's fine when they do it to Saddam— it's another thing when they do it to you.  They basically printed money out of thin air—about $1.25 trillion—and used it to purchase the so-called "toxic assets" from all the banks up and down Wall Street which were about to keel over dead. The reason they were about to keel over dead was because the "toxic assets"—mortgage backed securities and so on—were worth fractions of their nominal value. Very small fractions. All these banks were broke, because of their bad bets on these toxic assets. So in order to keep them from going broke—and thereby wrecking the world economy—the Fed payed 100 cents on the dollar for this crap. In other words, the Fed saved Wall Street by printing money, and then giving it to them in exchange for bad paper. More Here.. This posting includes an audio/video/photo media file: Download Now

How & When, But More Importantly, Why? Posted: 24 Mar 2011 11:19 AM PDT Dear CIGAs, Martin Armstrong just wrote a paper on gold titled, "How and When." My response to this article is why? Why in the world, if you believe that the gold price can go to $5000 and $12,500, as the article says, do you give a damn about the next 90 days? You must realize that the economic and political damage is already done. You must realize that the mountain of OTC derivative paper is not going away. You must realize that all the old legacy assets (broken OTC derivatives) demand to be adjusted at each market turn in order to maintain any semblance that they are serious contracts. You must realize that this adjustment means adding on new OTC derivatives. You must realize that this means the mountain of OTC derivative weapons of mass financial destruction can only grow. You must realize that it is not whether or not QE will continue, it is what it already has done to the Western economies that much higher gold prices will reflect. You must realize this is not a business problem, but rather a debt problem as it applies to the gold price. You must realize the monumental change in the Middle East is NOT positive for the West in any manner, shape or form. You must realize that the change in the Middle East is from some form of government to chaos. You must realize that the beneficiaries of chaos in the Middle East are Iran and Russia. You must realize that the main product of the establishment of a no fly zone in Libya is to benefit the Rebels. You must realize that the rebels are an unknown factor in Libya. You must realize that a second product of the no fly zone is greater hatred in the Middle East for all things West. You must realize that the peak production of energy is behind us. You must realize that the production of energy in chaos will be less than under some form of rule. You must realize that this combination of monumental Middle East change and peak oil means peak oil is no longer a consideration 10 to 15 years from now, it is now. You must realize that the Angels (gold prices) are not simple talk but rather a method used by the great market maven, Jesse Livermore. You must realize that on the next trip to $1444, that price will fall to the long term bull market on gold. You must realize that $1650, a place where gold will trade, is so low it will be comical looking back from 2015. You must realize that "QE to Infinity" is not a choice but all there is left in the tool box of the US Fed. You must realize the truth of today's comment by Dallas Federal Reserve Bank President. You must realize that what the President of the Federal Reserve Bank fears will occur.  You must realize no sovereign country needs to go broke. You must realize they simply refer to QE as policy. You must realize that it is the currency that breaks, not the country. You must realize that the point of correctness in the article "How and When" that is true is his $5000 to $12,500 figure and not the prognostications of the next 90 days. Fed's Fisher: U.S. debt situation at tipping point On Tuesday March 22, 2011, 10:43 am EDT By Marc Jones and Sakari Suoninen FRANKFURT (Reuters) – The U.S. debt situation is at a "tipping point," Dallas Federal Reserve Bank President Richard Fisher said on Tuesday, and urged the U.S. central bank to refrain from any further stimulus measures. "If we continue down on the path on which the fiscal authorities put us, we will become insolvent. The question is when," Fisher said in a speech at the University of Frankfurt. Fisher, seen by economists as one of the most hawkish policymakers within the Fed, said that although debt-cutting measures would be painful, he expected the U.S. to take the necessary actions. "The short-term negotiations are very important. I look at this as a tipping point." He said the U.S. economy was now growing under its own steam, but voiced his concerns about building global inflation pressures and said it was now time for the central bank to stop pumping out extra support. "The Fed has done enough, if not too much, and we should do no more.. In my opinion no further accommodation is necessary after June either by tapering off the bottom of treasuries or by adding another tranche of purchases outright." More…

JPMorgan Holding 30,844 Ounces of Silver for Clients Posted: 24 Mar 2011 10:48 AM PDT From Michael Krieger: As I mentioned a couple of days ago…this is UNREAL. Let's see the bank that has multiple lawsuits against it for silver price manipulation is the custodian of SLV and now for COMEX silver. What does this tell you about both entities? Full story below. As a friend said: "This JPM vault [...]

The entire Japan story is huge bullish for Gold and extremely bearish for all paper currencies certain to be debased further. Posted: 24 Mar 2011 10:45 AM PDT Surf Warning: Tsunami to Lift Gold Share this:

Meanwhile Afterhours... Posted: 24 Mar 2011 10:25 AM PDT It appears that someone may have called the bluff on our earlier post of a possible commencement of trading in advance of QE3 (and how anyone could be surprised that QE3 is coming is beyond us - it has been our conviction that the Fed is now on a slippery slope from which there is no return since late 2010), and decided to take our every offer in ES afterhours for nearly 10 points straight. That this trade was very much out of the ordinary is confirmed by the complete absence in any of the traditional correlation pairs (see chart below) such as the AUDJPY. Is the prevalent mindset finally one that QE3 is inevitable? If so, look for gold and silver to follow suit promptly and even promptlier nullify today's latest margin hike by the CME.

The Dollar Will Collapse Within 3-4 Months Posted: 24 Mar 2011 10:25 AM PDT The US Dollar's inflationary death spiral continues. We've now taken out the 2010 low leaving only two more lines of support before we're in completely uncharted territory. At its current rate of collapse, the US Dollar will do this within the next 3-4 months. This means the greenback will break into a new all-time lows by 2H11, which will precipitate the coming inflationary collapse. Small wonder then that both Gold and Silver recently hit new highs for their current bull markets. With the greenback dropping like a rock, and rumors of QE 3 swirling around the financial community, what sane investor would bet against inflation? On that note, now is the time to be shifting capital into inflation hedges. Those who buy Gold and Silver will likely do very well in the coming months (my personal view is Gold will clear $1,500 and Silver $40 this year). We’re also going to be seeing an increased wave of buyouts in the natural resources sector as larger firms look to increase their resources via mergers and acquisitions rather than spending the money to find and develop new mines.   The natural resources sector will also benefit as large institutions (pensions, mutual funds, etc) finally begin piling into inflation hedges across the board. Given how little exposure the Big Boys have to inflation hedges even a small percentage of assets under management, shifted into these sectors, could result in sharp price spikes.   In other words, buckle up, cause things are about to get REALLY interesting. Good Investing!   Graham Summers   PS. If you’re getting worried about the future of the stock market and have yet to take steps to prepare for the Second Round of the Financial Crisis… I highly suggest you download my FREE Special Report specifying exactly how to prepare for what’s to come.   I call it The Financial Crisis “Round Two” Survival Kit. And its 17 pages contain a wealth of information about portfolio protection, which investments to own and how to take out Catastrophe Insurance on the stock market (this “insurance” paid out triple digit gains in the Autumn of 2008).   Again, this is all 100% FREE. To pick up your copy today, got to http://www.gainspainscapital.com and click on FREE REPORTS.   PPS. We ALSO publish a FREE Special Report on Inflation detailing three investments that have all already SOARED as a result of the Fed’s monetary policy. You can access this Report at the link above.

Silver Price Must Hold Above 36.50 and Gold Price Above 1420 Posted: 24 Mar 2011 10:07 AM PDT Gold Price Close Today : 1427.50 Change : 1.30 or 0.1% Silver Price Close Today : 37.388 Change : 18.6 cents or 0.5% Gold Silver Ratio Today : 38.18 Change : -0.156 or -0.4% Silver Gold Ratio Today : 0.02619 Change : 0.000107 or 0.4% Platinum Price Close Today : 1754.30 Change : -3.00 or -0.2% Palladium Price Close Today : 751.95 Change : 3.70 or 0.5% S&P 500 : 1,309.66 Change : 5.86 or 0.4% Dow In GOLD$ : $176.24 Change : $ 1.08 or 0.6% Dow in GOLD oz : 8.526 Change : 0.052 or 0.6% Dow in SILVER oz : 325.52 Change : 2.25 or 0.7% Dow Industrial : 12,170.56 Change : 84.54 or 0.7% US Dollar Index : 75.65 Change : -0.142 or -0.2% Before he became sophisticated, before he even became sheriff of Mayberry, Andy Griffin was a comedian. In a priceless monolog entitled, "What It Was, Was Football" he plays a hick who had never before seen a football game. Imagine his confusion. Well, staring at these markets, I fell a lot the same way. STOCKS, the absinthe of investment cocktails, gained popularity today. The Dow gained 0.93%, 84.54 points, to 12,170.56. S&P performed almost as well, up 0.72% (5.86 points) to 1,309.66. My jaw dropped. Well, here's the thing: there are people who think that Joan Rivers is funny, and people who think heavy metal is music. Likewise, there are folks who buy stocks and think they're an investment. What can I say? I tell y'all, these currencies are more fun than a bucket of cockroaches, or a nail barrel full of scorpions. I love 'em. Were I long euros, I would be shucking 'em faster than a politician saying good-bye to his girlfriend when a Washington Post photographer shows up. The chart shows that the euro has reached its November high, and like that November high has made a jumpy, sketchy Island reversal pattern. What is that? Market's headed up, then gaps up, leaving a space behind. Trades sideways a day or few, then falls, leaving a gap behind. This ain't island paradise, I promise, but a virtual guarantee of vastly lower prices. BUT I COULD BE WRONG. In fact, that is so often the case that instead of writing it out every time, from now on I'll just use the initials: BICBW. The Japanese yen, is thanks to a multinational love-fest among Nice Government Men, behaving itself instead of flying to the moon and hamstringing the Japanese economy. Closed today at 80.936 yen to the dollar (123.55 cents/100 yen). Virtually unchanged. Meanwhile the scrofulous US DOLLAR INDEX stubbed its itty toe today, and dropped 14.2 basis points to 75.652. I'm inclined to believe the dollar is forming a bottom here, but not on enough evidence to convict a dog of liking T-bones. One should never underestimate the stupidity and arrogance of those in power. The morons running the European countries in 1914 allowed themselves to be drawn into a war that would kill millions and overthrow most of them. Why assume that Ben Bernanke and Co. are not prideful enough to stumble into destroying the dollar? They've got a good leg up on it. Y'all thought silver and gold were going to make it easy for you, didn't you? Well, today slapped that notion out of all of us. In an interview today with Jim Puplava of financialsense.com (aired tomorrow) he told me that silver margin requirements had been raised again. I can't find a press release on that, but it certainly would explain why silver and gold advanced, then hit a wall and slid down. Overnight the GOLD PRICE bulged through $1,440 resistance than in New York hit a $1,447.15 high about 11:00. Around 12:30 somebody dropped a piano on gold's head, and it slid down as low as $1,424 in the after- market. On Comex it closed down $3.10 at $1,434.80. It has traded as low as $1,430 since then. You can get all sweaty about that, or view it merely as another validation of $1,425 support. And I don't want to become the sort of slouch who instead of thinking always blames everything on the Nice Government Men and their manipulations, but were I them (O, thank God, I am not!) I wouldn't want gold to close over $1,450 and confirm another breakout to attract more investors. The gold price has no problems as long as it hovers higher than $1,420. Technically a break of that would be troublesome, but not fatal. On the upside the gold price still must beat $1,445 resistance and climb that $1,451 mountain. For now, all the momentum remains on gold's side, notwithstanding today's gyrations. By the time Comex closed SILVER had digested another 18.6c to close at another -- yawn! -- new all time high of 3738.8c. Another new ratio low of 38.376 oz of silver to one ounce of gold. In the aftermarket silver has continued falling to 3718c. Aww, come on! The silver price has risen 5 straight days. Today is no disaster. Still, to maintain respectability the silver price must remain above 3650c and in no case fall lower than 3600c. Sure, this rise is longer in the tooth than Methuselah's dog, and sure, it will sometime end, but I'm beginning to wonder when. Struggling to fix some upside target, I saw that silver had closed well above its 2006 - 2008 - 2011 top channel line. When that happens, you flip the bottom line of the channel over, effectively doubling the channel width. Silver's channel is about 1200c wide, so if you flip the channel and add 1200c to 3109c where it broke out, you get close enough to 4200c to scare it to death. I remind y'all that all this depends on the silver price holding above 3650c and the gold price above $1,420. Over and over people keep asking me, "Should I buy silver now or wait for a correction?" Listen, I SELL silver and gold, so I am not likely to tell you not to buy it. Pass everything I say through that filter. But the question has the wrong goal in mind. When you buy silver or gold you are not trying to hit a price POINT, but to take a long, large piece out of a primary trend upward move. Even if your timing is the worst, the upward trend will bail you out, so stop trying to look perfect to your sneering brother-in-law. Buy the primary trend and it WILL be profitable. Otherwise here's what will happen: you will be tortured between fear and greed, fearful it will fall, greedy for it to fall further. You'll dilate and hesitate and finally not buy anything. So for all your cogitating and perspiration, you will only get to wave bye-bye to the Silver and Gold Train and brag to your brother-in-law how you ALMOST bought it. On this day in 1882 in Berlin Robert Koch announced the discovery of the germ that "caused" tuberculosis. In line, however, with my policy of never accepting the official explanation, I demur to the germ theory of disease, as, it is rumoured, even Pasteur did in his latter days. Reason is simple: I have on my skin a zillion copies of say, the tuberculosis bacillus, but I don't get it. You have same, and get the disease. If it causes the disease, why don't I get it? Answer: it doesn't cause the disease. The weak immune system fails to fight off the attack of the opportunistic bacillus, which moves in and commandeers the surrounding countryside. Is it not more likely, as Pasteur's contemporary Antoine Bechamp argued, that bacteria change forms (pleomorphism) and that their forms are not constant but change with their environment? That throws the cause back onto the immune system failure. Whoa, y'all don't let me slow you down. Just keep on dousing your hands and bodies with those anti- bacterial soaps and other poisons. BICBW, so don't worry even a little bit! Argentum et aurum comparenda sunt -- -- Gold and silver must be bought. - Franklin Sanders, The Moneychanger The-MoneyChanger.com © 2011, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold; US$ or US$-denominated assets, primary trend down; real estate in a bubble, primary trend way down. Whenever I write "Stay out of stocks" readers inevitably ask, "Do you mean precious metals mining stocks, too?" No, I don't.

Heeding the Irrational Market Posted: 24 Mar 2011 09:29 AM PDT by Addison Wiggin - March 24, 2011 Durables disappoint, but stocks rally... why it's significant buyers are back now The off-budget war... how Libya is eating into proposed budget cuts Oldest spelling bee winner dies... a surprising analysis of what his 1925 prize is worth today "Who the f*** cares?" we asked, readers reply with equal helpings of contempt... and praise... Plus, a reprise of the cult hit "We Ain't Broke Yet"... your last chance for a discount to the Penny Momentum Trader... and more... 0:00 — Orders for durable goods — "stuff" expected to last three years or more — fell 0.9% in February, the biggest drop in four months. Machinery orders fell the most among the sub categories, down 4.2%, says the Commerce Department. This is not a sign of a recovery. The Street was counting on an increase of 1.5%. Oops. 0:12 — Even so, "a bull market," we pervert the late Lord Keynes, "can remain irrational longer than you can remain solvent." The Dow and the S&P both opened up 0.4% this morning. The S&P is back above 1,300 for the first time in a week. Not that you should be surprised. Our Penny Momentum Trader Jonas Elmerraji shared a chart on Monday showing the long-term trend line from the March 2009 low (the infamous S&P 666) intact and moving upward. "The S&P 500's return above the 1,300 level," Jonas explains, "is critical right now, following the fundamentals-induced sell -off of the last couple of weeks. But that only tells part of the story — equally important is just how quickly the S&P snapped back as the index approached its secular trend line." 0:30 — "As tentative as investors may be about the market right now," Mr. Elmerraji continues, "the price action of the last week at least shows that buyers are still willing to come out in force if the price is right." "There's been a lot of discussion lately about whether it makes sense for investors to remain bullish right now. I think that, in many ways, that's the wrong question — instead, I'm concerned with whether or not the market will remain bullish regardless of how much sense it makes." "There's a big difference between being right and making money." "That said, auspicious as the S&P's price action has been in the last several trading days, uncertainty and volatility are still playing a big role in this market. That's why it's so crucial to remain tactical and unemotional right now. "To that end, we've been exploring other asset classes to achieve gains in March." [Ed. Note: Only a few hours remain to take advantage of membership in Jonas' Penny Momentum Trader at the charter-subscription rate. The offer expires tonight at midnight.] 0:55 — Not that there isn't ample reason for concern. The sovereign debt crisis in Europe is gathering speed again, for example. Portugal's parliament rejected an austerity budget yesterday, prompting the prime minister to resign. It's almost a sure thing now that Portugal will have to tap the European Union's bailout fund, to the tune of $99 billion or more. 1:02 — Moody's, meanwhile, downgraded 30 Spanish banks, right on the heels of their decision to downgrade Spanish government debt. 1:06 — And yet like in the U.S. stock market, traders in the forex market couldn't care less. The euro is up fractionally to $1.41. 1:09 — Crude oil is holding steady at $105.64 as we write, a few pennies off the high set earlier this month. Well, at least the oil price makes sense. After all, Col. Gaddafi’s forces in Libya are keeping up a relentless attack on rebel-held cities. Libyan oil production, 1.6 million barrels a day before the war, is down to perhaps 300,000 barrels now. 1:20 — "It's hard to know exactly how this turns out," said Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, on Sunday, the day after the air strikes began." "Let me see if I've got this straight," interjects our resident oil field geologist and Naval War College graduate Byron King. "The U.S. armed forces, and allies, are waging intercontinental techno-war against Libya — a desert-dictatorship that is, at root, a failing, North African petro-state with mostly third-rate military capabilities." "But according to the top honcho of the JCS, we don't know how it's going to turn out?" "What else doesn't Adm. Mullen know? Let's get down to basics. What's the alliance? Who's fighting whom? Who's with us? Who or what are we targeting? Is this Libyan air show a NATO thing? If so, why does NATO member Turkey oppose it? Why is a core NATO member, Germany, pulling out? "More broadly, what's the strategy? What's the operational concept? What's the order of battle? What are the military goals? When the shooting stops (and it will stop, right?), with whom do we make peace? So maybe we won't have a signing ceremony on the deck of a battleship, but what's the theory of victory? Um... by the way, who's in charge?" 1:41 — To this list of questions, we add our own: Who’s paying for this and how? To date, we’ve lost one F-15 jet ($30 million) and we’ve fired off 110 cruise missiles ($66 million), for a cost of $96 million. Ballpark estimates of the ongoing cost run about $100 million a week. That'll eat into the $100 billion in budget cuts the new Congress keeps promising. "What happened to all those people waving the Constitution last fall?" a friend asked by email this morning, citing these statistics. 1:53 — "The U.S. government doesn't have a 2011 budget for its Department of Defense," Byron points out, "and we're six months into the fiscal year." That’s because the previous Congress failed to pass a budget for defense... or anything else. "Not to put too fine a point on it," Byron says, "Congress has authorized no money to fight wars — at least not this one. Thus, right now, the U.S. is shooting missiles, dropping bombs and engaged in its third, simultaneous 'hot' war (actually, the fourth, if you include bombing Pakistan), and there's no budget." There is a "continuing resolution," a means by which Congress keeps kicking the can down the road so the government doesn’t shut down. The current one expires April 8, two weeks from tomorrow. "The nature of the continuing resolution," Byron points out, "is that it restricts the Department of Defense to fighting this year's wars on last year's budgeting structure. I don't believe there's a line item for ‘bombing Libya.'" On second thought, it makes no sense. 2:24 — "There goes the gas glut," Byron also writes, changing tack a bit. In the wake of the ongoing nuclear scare, "Japan is scrambling for liquefied natural gas (LNG) supplies. So LNG tanker ships are moving toward Japan..." "The Russians — particularly Gazprom — are promising to step up gas exports to both Japan (with LNG out of Sakhalin Island) and to Europe, to make up for European LNG that's being diverted." "Meanwhile, the loss of gas exports from Libya, through a pipeline to Italy, is also playing havoc with European gas supply. Indeed, the Italians just asked Gazprom to increase supply by an astonishing 60%!" "You need to keep your eye on the gas players," concludes Byron. "It's going to get better for their collective bottom line." Byron is eager to get his latest report in your hands. It’s called 11 Ways You Can Profit From the End of Nuclear and the Return of Natural Gas. It's yours — along with a one-month trial of Outstanding Investments — if you make a donation for earthquake relief in Japan. It's the ultimate in "doing well by doing go as you'll see here. 2:40 — The winner of the first national spelling bee, held in 1925, has died at age 97. What caught our eye was not what Frank Neuhauser accomplished, but the prize he collected all those years ago: "$500 in gold, a bicycle and a trip to the White House to meet President Calvin Coolidge," reports The Washington Post obit. Frank Neuhauser signing autographs at a recent national spelling bee... Back in those days, gold was $20.67 an ounce... so Mr. Neuhauser walked away with more than 24 ounces. Had he held onto that through his long life, that prize would now be worth $34,833. Turns out the prize for winning the national spelling bee is one thing that's actually kept up with the gold price in the ensuing years. Present-day winners collect prizes worth more than $41,000... $30,000 cash An engraved loving cup trophy A $2,500 savings bond A reference library from Merriam-Webster $3,800 in reference works from Encyclopaedia Britannica $5,000 cash from the Sigma Phi Epsilon Educational Foundation. Alas, the comparison still falls a bit flat, for winning the bee these days requires a lot more effort. Mr. Neuhauser's winning word was "gladiolus," as in the flower. Last year, it was "stromuhr," a device that measures blood flow through an artery. 3:19 — "You seem to enjoy taking a swipe at Bernard von NotHaus' conviction," a reader writes. "But he did actually stand up to the Fed, not just in words, but in deeds! I ask you, what did he really do that was illegal?" "If you can get past your dislike for the man personally and understand what he was fighting for, a better view of the man should come forth." "As I understand it: Liberty Dollars were privately minted gold and silver rounds. Paper certificates, akin to warehouse receipts, were also issued, effectively giving the bearer a right to claim a certain amount of gold or silver at the group’s warehouse in Coeur d’Alene, Idaho." "This is traditionally how the system of money used to function — precious metals would be stored in private secure storage facilities, and paper certificates were issued as a medium of exchange that entitled the bearer to redeem metal from the vault. Liberty Dollars represented a return to that system. "Where do you see this as a bad thing worthy of a condescending pen? If only you and Ron Paul had the courage to sacrifice something so noble and valuable as your freedom for the cause of liberty." The 5: The reader then attaches an article about von NotHaus that first appeared at Casey Research, evidently unaware that Doug Casey is also on von NotHaus’s "bellybutton traitor list." 3:41 — "If I remember correctly," writes a reader who is confusing us with someone who does care, "you were quick to mention that the Republicans wasted no time when they came to power in passing the tax cuts. Evidently, you gave a f*** or you would not have mentioned them." "Let's give credit and blame where it is due and refrain from crude and vulgar discourse. This is supposed to be a site about how to make money. If I want to read about politics, I will go to some other site." The 5: Indeed, this is supposed to be a site about making money. This is not a site about politics — hence, my crude and vulgar question. But if we're going to give credit where it is due, then we think the next reader assigns it correctly. 3:52 — "You are right when you ask 'who the f*** cares' who passed them," our friend replies. "Does the zebra have black stripes, or does it have white stripes? Is Congress Republican or Democrat?" "Democrats and Republicans alike are not going to change anything that might cost them votes come Election Day. They pass obscene laws and budgets because they know the majority of Americans do not comprehend what they have done. Frankly, I think some politicians do not comprehend what they are voting on either." "Each one follows the tail of the donkey or the elephant in front of them, never asking any questions, just following the leader off the cliff. Then another one will come along to replace him or her and do the same thing, over and over again. It doesn’t matter if it is Democrat or Republican." "Look at history: Both parties have been guilty of the same sins for many, many years now. I don’t think either party, at this time, has a workable solution. They will continue to cast stones at their opponents hoping no one notices what each of them has done. It seems to be working." The 5: For them, perhaps. But how long will it continue to work? 4:14 — "Just thought I'd try out the dare. I've been thoroughly pleased with The 5, and all of your other services. It's not only educational, although I can't side with ALL your views, but quite entertaining." "Please don't stop printing your reader's mail. As long as you include them, especially the rather nasty ones, subscribers not only receive a good education and informing market and political commentary, we get some of the best humor available." "And to all you humorists out there, calm down. The world isn't coming to an end, just the world as we know it." 4:29 — "I can't tell you how often I have to laugh out loud at your responses to some of the reader comments," adds another. "Your 5 Min. Forecast provides a lot of entertainment, besides worthwhile info." "I love your sense of humor. Does my heart and mind good! Thanks for all. Keep it coming." Gracias, Addison Wiggin The 5 Min. Forecast P.S. After just two weeks, "I made enough net profit on a $5,200 bet," writes a reader who does get what this site is supposed to be about, "to pay for your one year subscription" of Penny Momentum Trader. "I look forward to the coming year... and beyond." That's not an outlier. In fact, it’s exactly how Jonas' S.T.O.R.M. system is designed to work. Charter subscription pricing is still available, but only through midnight tonight. Here's where to grab yours. P.P.S. This site is also about having a good time. In fact, the gentleman who designed the site is in a band called Mixed Business. If you're a veteran of our investment symposium in Vancouver, you'll recall Mark O'Dell, the band and special guest Andrew Ascosi debuted their original song "We Ain't Broke Yet" at the symposium. Mark wrote the tune after having tortured himself by reading through the entire length of Empire of Debt. (This recorded version also features Mike Auldridge of The Seldom Scene and Lyle Lovett fame on the Dobro & Pedal Steel.) This coming Saturday night, Mixed Business is hosting a CD release party at Mick O'Shea's, our favorite Irish Pub, on Charles Street in beautiful downtown Baltimore. The CD features a couple of songs we think you'll appreciate... "Guns & Gold" and "Gun In My Glove Box". The CD also features a curious ode to Tom Waits called "The Mule", penned by Greg Grillot, our copy chief. Says the CD's liner notes: "Mixed Business' self-titled output (released in 2011 and produced by Ruben Dobbs & Mixed Business) takes you to the American heartland to ponder life and love with country-inspired ballads 'Guns & Gold,' 'Seasons in Love,' and 'You Think It's Better This Way,' then drops you in the Deep South to drink whiskey with share-croppers on 'The Mule', plants you firmly in snowbound gypsy campsites and hot back-alley Spanish brothels with 'Yuliana' and ‘The Red Room,' and then meets you just down the street at your local bar to hoist a pint with the soon-to-be-a-hit-single drinking songs, 'Gun in My Glove Box' and 'Bottles & Bottles of Beer'!" "Mixed Business is what you get when you make a band out of world travelers, barroom regulars, and classically trained musicians. Blending rock, folk, blues, country, bluegrass and jazz — Mixed Business refuses to fall into any one genre." If you're into original music by talented newcomers, you can learn about the band here and get a copy of their debut CD here.

Aggressive Retirement Portfolio For the Next 3 Years Posted: 24 Mar 2011 09:09 AM PDT The Golden Economizer Yesterday I put up an article on a simple retirement portfolio for the next three years, and described the results of the picks I had made three years ago (with much less market knowledge than today). This was an exercise to illustrate how well a simple portfolio of just ten equities could perform compared to a widely diversified portfolio constructed using standardized financial planning principles. The idea was to show how identifying a long term fundamental market trend and investing to capitalize on that trend would outperform a portfolio designed on fixed percentage allocations in various asset classes. The major issue to be debated is how much extra risk is involved with this strategy. Certainly, if you misidentify the long term trend on which you base your portfolio choices, the risk would be greatly magnified. This article assumes that you correctly identify a market trend, in this case, the extreme underpricing of silver based on year...

Nevada to Ramp Up Mining Taxes? Posted: 24 Mar 2011 09:09 AM PDT Author:  Vedran Vuk Synopsis:  Is the state of Nevada about to ramp up mining taxes, and what would be the consequences – not just for the mining industry but for the economy? Also in this edition: Why Washington is not the place for free-thinkers… and Gallup on the war in Libya. Dear Reader, As some of you already know, I briefly worked in the policy world in Washington, D.C. First, I was employed at a think tank and then worked for a lobbyist on K street – however, only on free-market issues. I had many reasons for leaving the policy world behind, but one of the biggest was the futility of it all.  Working for free-market causes in D.C. is harder than rowing upstream; in fact, it's more like rowing through a tsunami. The odds are always against you. The city is full of career lobbyists, and they have no moral compass whatsoever. If someone paid them to defend oil companies, they would do so. If someone paid them to defend green energy, they would do so. D.C. is simply a career path for them and has nothing to do with ideology. Then there are the folks who walk the party line. Sure, on the Republican side, they'll talk free markets, but only to the extent that the party accepts the ideas. They will still praise Bush and McCain. And for a successful D.C. career, that's what must be done.  Furthermore, the optimal Washington employee falls somewhere between average and exceptional intelligence. A D.C. employer wants someone who can come up with interesting one-line sound bites. They want someone that can dig into research to embarrass the opposition. But at the same time, they don't want an employee thinking too much. If he or she realizes that the arguments are complete BS and the whole enterprise is hypocritical, then a problem arises. Overall, Washington is a horrible environment for a free-thinker of any sort – whether on the left, right or libertarian.  If one wants to be told how to think, what to think, and where to think, then a D.C. job is the perfect setting. That's why I much prefer the investment world. Not only does one not have to follow the party line, but innovative ideas are actually encouraged. Plus, it's not a futile effort. In Washington, one can write policy piece after policy piece against the Federal Reserve, yet nothing gets done. In the investment world, an analyst can pick investments such as gold and silver and create real value by protecting subscribers and clients from the Fed's policies. As our newsletters get more subscribers, more individuals are protecting their wealth against the foolishness of government agendas.  In politics, a free-market supporter rows his boat against a tsunami in futility. At Casey Research, I see us fighting against the same wave, but rather than aimlessly rowing against the tide, we're throwing out life rafts and preservers to as many people as possible. At the end of the day, our readers are benefitting in real terms from the efforts of our research teams and editors. Maybe we can't stop the growth of government and the Federal Reserve's ceaseless monetary expansion. However, we can protect ourselves with gold, silver, and other wise investments. And we can help our friends, families and subscribers from drowning in a massive wave of inflation, government debt and overreach.  Despite all the government obstacles, it's still possible to achieve personal freedom through financial freedom. Next, Alena Mikhan and Andrey Dashkov will inform us about possible new mining laws on the horizon in Nevada. And then I'll touch on some Gallup polls on the Libyan conflict. Nevada Mining Taxes to Rise? By Alena Mikhan and Andrey Dashkov Talk of a need to collect more money from Nevada's mining industry is back. NGO activists claim that mining is "legally exploiting the state of Nevada thanks to a system of tax loopholes and its protected status in the Nevada Constitution." As MineWeb reports, "The Nevada mining industry generated $5.8 billion in gross proceeds in 2009. After deductions, the companies' net proceeds were US$1.8 billion on which US$47.8 million in taxes were paid on the net, along with US$46.4 million in local taxes." To some, this looks unfair. Another bout of tax increase rants started in January 2010 when the Progressive Leadership Alliance of Nevada proposed an initiative calling for a change in mining taxes from a net proceeds tax to a gross proceeds tax. A year later, an assemblywoman has introduced a bill that would cap the value of deductible expenses by almost half, which could cost the state's mining industry more than US$2 billion in tax deductions.  This measure might not kill the industry, but it would certainly kill a lot of mines operating on slender margins. It would, without doubt, have a strongly negative impact on the state's investment climate and its economy, mining being a significant part of both. Nevada's gold production accounts around 80% of total U.S. output. This year it's expected that Barrick and Newmont (which together are estimated to mine 90% of Nevada's gold) will contribute US$135 million in net proceeds taxes. Gold companies contribute to the local economy in many ways besides paying taxes; they develop infrastructure and services in communities around the state and create economic growth in businesses outside of the industry's direct supply chain. And that's not to mention the many Nevadans they employ directly and train to higher skill levels. Dramatic changes in tax policy can have a powerful impact on investment climate of any jurisdiction. Nevada is currently still considered a top mine-friendly area, taking second position among the world's top 10 jurisdictions, according to a report published by Fraser Institute on March 3. Many company executives, however, are concerned about the uncertainties around the mining tax, so we can expect that Nevada may lose some of its investment attractiveness in the next ranking, as it did in mid-2010 due to similar tax worries. As with the Quebec scare we reported on last week, this initiative doesn't seem likely to pass as is. We will, however, continue monitoring the situation and inform you of future developments. Gallup on the War in Libya By Vedran Vuk A few days ago, I mentioned the blind support Obama would receive on the Libyan strikes from Democrats. Despite the hypocrisy, they would back him. As a result of my statements, I received a few angry emails from readers. Rather than argue back and forth, let's take a look at Gallup's recent poll on the subject. Interesting poll, huh? The Independents have a large approval gap compared to either Republicans or Democrats. The Republican Party traditionally supports wars. And the Democrats support anything Great Leader does – no matter the degree of hypocrisy. If anyone has other explanations for this large gap with Independents, please write in and let me know.  Even Gallup itself notes: "The lack of a significant Republican-Democratic difference could be the net result of Republicans' inclination to support military action and Democrats' inclination to support the Obama administration's policies. Gallup found similar dynamics at play during the Vietnam and Korean Wars." The comparison of overall support at the onset of other military actions is interesting as well. Libya ranks the lowest. It shows the sad state of our attitude toward war: every single one has majority support at the beginning. The war spending continues without end. Well, that's it for today. David Galland should be back tomorrow. Thank you for reading and subscribing to Casey's Daily Dispatch. Vedran Vuk Casey's Daily Dispatch Editor

Exactly How Does This Turn Out? Posted: 24 Mar 2011 08:26 AM PDT "It's hard to know exactly how this turns out," said Adm. Mike Mullen, chairman of the Joint Chiefs of Staff, this past Sunday, in answer to a question about the US-French-British-et al. aerial assault on Libya. Oh, really? The admiral made his statement after US and British ships opened fire and put 114 million-dollar Tomahawk cruise missiles downrange at Libyan targets over the weekend. Another 25 or so US and British Tomahawks have left the launch boxes in the past couple of days. Meanwhile, over the weekend, French jets bombed the tar out of Libyan armored and troop columns near Benghazi. While a flight of B-2 bombers soared from Missouri, crossed the Atlantic Ocean and Mediterranean Sea and dropped precision weapons on other Libyan targets – according to Aviation Week & Space Technology magazine. So let me see if I've got this straight. The US armed forces, and allies, are waging intercontinental, techno-war against Libya – a desert-dictatorship that is, at root, a failing, North African petro-state with mostly third-rate military capabilities. But according to the top honcho of the JCS, we don't know how it's going to turn out? We don't know? That's quite an admission by Adm. Mullen. If nothing else, whatever happened to sounding confident for the TV cameras and saying, "We win, they lose"? Then again, what else doesn't Adm. Mullen know? Let's get down to basics. What's the alliance? Who's fighting whom? Who's with us? Who or what are we targeting? Is this Libyan air show a NATO thing? If so, why does NATO member Turkey oppose it? Why is a core NATO member, Germany, pulling out? More broadly, what's the strategy? What's the operational concept? What's the order of battle? What are the military goals? When the shooting stops (and it will stop, right?), with whom do we make peace? So maybe we won't have a signing ceremony on the deck of a battleship, but what's the theory of victory? Um…by the way, who's in charge? Sure, there's an adrenalin rush from picking up the morning newspaper and seeing front-page photos of bombs bursting, airplanes falling and tanks smoking. Then again, you could get your heart rate up by going to see the recently released movie Battle: Los Angeles. Wow, what a campy ordnance flick! It's a Marine Corps recruiting infomercial from start to end. And at least in Battle: Los Angeles, you can set aside your moral qualms. Battle: Los Angeles is a sci-fi bug hunt, in which space aliens have invaded Santa Monica and are, in turn, getting what they asked for. But I digress. Space aliens aside, it's not as if Libya's Generalissimo Gaddafi doesn't have serious pain coming to him. He's never paid for his role in the gratuitous 1988 bombing of Pan Am Flight 103. On that point of history, the US should maintain a very long memory – and be open and honest about it when the right time comes along. In case you can't tell, Pan Am 103 brings out my inner Roman Legionnaire. I think that Pan Am 103 supports the ancient concept of a purely punitive expedition. Blow up one of our airliners? We'll pulverize you, out of raw vengeance. Under most circumstances, I'm OK with bombing Gaddafi under the doctrine of payback and specific deterrence. That is, he'll never blow up another airliner because he'll be toast. But something troubles me about the current military display. The air raids are occurring absent anything like a formal US declaration of war against Libya, let alone a mere congressional authorization to employ arms. Indeed, before the Romans destroyed Carthage, they debated the purpose of their effort in their Senate. The outcome? Well, they set a clear policy. "Carthago delenda est" (Carthage must be destroyed.) Now, however, the US is waging war under a rather novel form of legal reasoning, if not presidential war powers. Shoot first, and notify Congress later. Or are we saying, perhaps, that the legal authority to attack Libya is embodied in the "Marines' Hymn"? You know, "From the Halls of Montezuma/to the Shores of Tripoli," and all that. In which case, does Mexico have to worry? Let's get past the military fact that it's raining steel in Libya. Something else troubles me. The US government doesn't have a 2011 budget for its Department of Defense – and we're six months into the fiscal year. This is, at root, courtesy of the last Congress, which failed to pass a defense budget in the waning days of 2010. No defense budget? Last year, there was political capital for Congress to pass "don't ask, don't tell" legislation. But for some strange reason, Congress could not pass anything as mundane as a law to fund procurement and operations, let alone to pay the troops. Not to put too fine a point on it, Congress has authorized no money to fight wars – at least not this one. Thus, right now, the US is shooting missiles, dropping bombs and engaged in its third, simultaneous "hot" war (actually, the fourth, if you include bombing Pakistan), and there's no budget. Not to be legalistic, but isn't every fire-breathing Tomahawk missile a violation of the Antideficiency Act? Let me refine this last point. There's a recently passed congressional "Continuing Resolution" (CR), valid until April 8 that appropriates funds to the DOD. But the nature of the CR is that it restricts the DOD to fighting this year's wars on last year's budgeting structure. I don't believe there's a line item for "bombing Libya." The whole thing is very strange. And no, I am NOT making any of this up. At the beginning of this note, I said that I'd come around to the investment side of things, and here we are. What should you do? Easy. Buy gold and silver. Buy shares in mineral developers with assets in the ground. Buy oil- and energy-related shares, as well as oil service players. See? Easy. Why buy gold and silver? Because the US government is fighting wars without really knowing what it's doing (Adm. Mullen, call your office), let alone how it's paying for the bullets (see above). And this is just a mini-version of all the other things the US government is doing without having the resources to pay for them. Using the above-noted DOD budget mess as an example, the US is not just spending money it doesn't have fighting an unauthorized war. No, the US is spending money when Congress has not even passed a real budget. Of course, this is just a small step removed from the usual routine of Congress spending money that's not there. The bottom fiscal and monetary line is that the federal budget is out of control. Federal spending is out of control. The federal deficit is out of control. The national debt is out of control. Interest on the national debt is out of control. Neither the president nor Congress is in control. To quote Adm. Mullen, "It's hard to know exactly how this turns out." The endgame is that the dollar is destined for inflation, loss of value and the long-term impoverishment of people who don't invest around this nation-busting, failed-state-walking issue. Buy gold. Buy silver. Regards, Byron King for The Daily Reckoning Exactly How Does This Turn Out? originally appeared in the Daily Reckoning. The Daily Reckoning now provides over half a million subscribers with literary economic perspective, global market analysis, and contrarian investment ideas.

Gold Daily and Silver Weekly Charts - Blythe Strikes Back, La Reine de la Nuit Posted: 24 Mar 2011 08:26 AM PDT This posting includes an audio/video/photo media file: Download Now

8 Hour Gold Update - 2:30 PM CDT Posted: 24 Mar 2011 08:20 AM PDT [url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] It is apparent that someone was not too happy with a brand new all time high in gold today. It was stuffed back into its box quite unceremoniously I might add. One can tell from looking at the volume that all of the new longs that bought the breakout of the nearly month long congestion pattern have been handed an immediate paper loss thanks to the barrage of selling. It will be up to the bulls to hold the line near $1420 or the technicians are going to have a field day trumpeting a false breakout which will engender some further long liquidation, especially because we are entering a rollover period - a favorite time for these bear raids to occur in the past. If the bulls can hold $1420, they will be okay. If they fold here, the price is going to drop back lower into the former congestion zone and will more than likely test $1410 again. Either way the price action is not encouraging. The H...

Gold/Silver Ratio Stuck Posted: 24 Mar 2011 08:05 AM PDT Hard Assets Investor submits: By Brad Zigler Real-time Monetary Inflation (last 12 months): 2.2% A couple of weeks ago, we said we'd get back to you when the gold/silver ratio hit a 37-to-1 objective ("What's Next For The Gold/Silver Ratio?"). Well, it hasn't happened yet. I mean, the ratio—basis London spot—has dipped. On March 10, the date our feature was published, gold's price multiple (PM) was 40.5x. When the metals' prices were fixed on March 23, the multiple had slid to a new low of 39.2x. Gold/Silver Multiple (Click charts to enlarge) The downward trajectory of gold's price multiple has been essentially stalled, giving up inches grudgingly. That's not surprising, given the terminal phase of its decline. We're talking about giving up only two more handles for this phase to play itself out. The slowdown's largely due to the "risk off" switch being pulled recently. The gold/silver trade—that is, trading silver on the long Complete Story »

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