Gold World News Flash |
- Indirect Exchange : the Gold Standard
- Gold: MACD And The Greed Factor
- Gold is not in a Bubble: It’s on its way to $10,000 an ounce
- Stephen Leeb - $15,000 Gold as Bull Market Pace Accelerates
- Embry - If We Repeat 2008, Stocks Could Fall 40% From Here
- Gold Seeker Closing Report: Gold and Silver End Mixed; Rise Afterhours
- Bob Chapman (SGTreport EXCLUSIVE): Cointelpro, Is the ‘OCCUPY' Movement Infiltrated? Ag & Au Update
- Provoking China: Selling F-16 to Taiwan or The Currency Bill?
- You Know That Your City Has Become A Hellhole When…
- China’s Gold Hunger Likely to Keep Demand High
- China Installs Gold Vending Machine, Plans 2,000 More
- China’s Pan Asia Gold Exchange: A New Playing Field for Speculators?
- Guest Post: Putin's New Vision Of Eurasia
- Guest Post: Putin's New Vision Of Eurasia
- Harvey Organ's: The Daily Gold & Silver Report
- Deliberately Seeking Beta: Interview with Robert Arvanitis
- John Embry - If We Repeat 2008, Stocks Could Fall 40% From Here
- Gold is not in a Bubble: It’s on its way to $10,000 an ounce
- Banks are toast, trillions more in bailouts coming, Embry tells King World News
- The Silver and Gold Price Bull Market Has Not Near Ended, Lots More Time and Upside Left
- Keiser Report: Ground Zero of Financial Terrorism (E195)
- Could a Tea Party Occupy Wall Street?
- Another version of the 'stump speech' on gold price suppression
- The Madness of Crowds
- Don Coxe Update – Dexia and Gold
- Gold Short Term Channel Defines Trend – Focus is on 1740
- Slovakia Rejects Plan To Expand EFSF, Government Falls
- Gold Daily and Silver Weekly Charts
- THE WELL-OFF SHOP WHILE THE PEASANTS GRAB THEIR PITCHFORKS
- Marc Faber: Introduce Flat Tax, Reduce Regolatory Environment
| Indirect Exchange : the Gold Standard Posted: 11 Oct 2011 06:30 PM PDT Mises.org
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| Gold: MACD And The Greed Factor Posted: 11 Oct 2011 05:47 PM PDT Graceland Update
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| Gold is not in a Bubble: It’s on its way to $10,000 an ounce Posted: 11 Oct 2011 05:45 PM PDT Bullion Management Services
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| Stephen Leeb - $15,000 Gold as Bull Market Pace Accelerates Posted: 11 Oct 2011 04:30 PM PDT  With continued volatility in the gold and silver markets, today King World News interviewed acclaimed money manager Stephen Leeb. When asked what he sees happening, Leeb responded, "The talk about letting inflation rise is gaining momentum and is seeping through the cracks in the Federal Reserve. That is an extraordinary sign for gold. If the Fed really does come to the conclusion that fighting unemployment is more important than inflation, for the short-term, I think that you are into the second part of the gold bull market which should be even more dynamic than the first."
This posting includes an audio/video/photo media file: Download Now | ||
| Embry - If We Repeat 2008, Stocks Could Fall 40% From Here Posted: 11 Oct 2011 04:01 PM PDT  With gold holding near the $1,650 area and silver around $32, today King World News interviewed John Embry, Chief Investment Strategist of the $10 billion strong Sprott Asset Management. When asked about events around the world and how they are impacting gold and silver, Embry responded, "This Dexia Bank failure just showed how vulnerable the European banking system is. This was one of the banks that stood out in their stress tests and then two months later they have to recapitalize it and nationalize it. This probably brought home to people that we are talking trillions of euros to recapitalize the banking system over there to keep it functioning."
This posting includes an audio/video/photo media file: Download Now | ||
| Gold Seeker Closing Report: Gold and Silver End Mixed; Rise Afterhours Posted: 11 Oct 2011 04:00 PM PDT Gold reversed early Asian gains and fell $14.90 to as low as $1654.10 by about 5AM EST, but it then rallied back higher in New York and ended with a loss of just 0.56%. Silver fell to as low as $31.34 before it also rallied back higher and ended with a gain of 0.28%.
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| Posted: 11 Oct 2011 03:50 PM PDT Bob Chapman of The International Forecaster is back to talk to SGT about gold, silver, and current events.
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| Provoking China: Selling F-16 to Taiwan or The Currency Bill? Posted: 11 Oct 2011 03:31 PM PDT
Monday, Oct. 10 marks the 100th anniversary of the Xinhai Revolution that ended the Qing Dynasty as well as 2,000 years of Imperial China. Sparks have always been flying in the Taiwan Strait between Taiwan and China with the latest being the F-16 fighter planes Taiwan wanted to buy from the U.S.
From an op-ed piece by Bloomberg editors:
While I also admired the diplomatic maneuver by the White House, at the same time, I could not help but find this self-contradictory in the context of the Currency Exchange Rate Oversight Reform Act (aka China Currency Bill) just being passed at the U.S. Senate, which, by the way, curiously was not mentioned or referenced in the Bloomberg article. .
Does the U.S. think China will not get totally "needlessly provoked" by the Currency Bill? Think again!
From Global Times:
From Xinhua (Chinese government's unofficial mouthpiece)
The Bloomberg article went on to cite a a study commissioned by Lockheed Martin Corp. (LMT), who manufactures the F-16, that
So let me get this straight...
On the one hand, for the sake of not to "needlessly provoke" China, the U.S. is willing to not only scrap a multi-billion-dollar revenue and jobs creating commercial deal, but also skirted its own law, and broke its commitment to an ally who fought side by side with the U.S. in WWII.
On the other hand, the U.S. has no problem slapping the Currency Bill in China's face without any regards to the potential economic and geopolitical impact.
The U.S. government obviously has decided to pick its battle based on American politics. Last time I checked, when the U.S. passed the Smoot–Hawley Tariff Act in 1930, it acted only to deepen and prolong the Great Depression.
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| You Know That Your City Has Become A Hellhole When… Posted: 11 Oct 2011 03:28 PM PDT from The Economic Collapse Blog:
All across America there are cities and towns that were once prosperous and beautiful that are being transformed into absolute hellholes. The scars left by the long-term economic decline of the United States are getting deeper and more gruesome. The tax base in many areas of the nation has been absolutely devastated as millions of jobs have left this country. Hundreds of cities are drowning in debt and are desperately trying to survive. Last year, city government revenues in the United States fell by another 2.3 percent. That was the fifth year in a row that we have seen a decline. Meanwhile, costs associated with health care, pensions and virtually everything else continue to explode. So what are cities doing to make ends meet? Well, one big trend that we are now witnessing is that many U.S. cities have been getting rid of huge numbers of employees. If you can believe it, 72 percent of all U.S. cities are laying workers off this year. Social services and essential infrastructure programs are also being savagely cut back in many areas of the country. The cold, hard truth is that most of our cities are flat broke and things are going to get even worse in the years ahead. So how do you know if your own city has become a hellhole? Read More @ TheEconomicCollapseBlog.com
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| China’s Gold Hunger Likely to Keep Demand High Posted: 11 Oct 2011 03:17 PM PDT from WealthCycles:
China overtook South Africa in 2007 as the world's largest gold producer. At the same time China has increased its gold imports five-fold between October 2009 and October 2010, according to Bloomberg. As we reported in our April 26 Market Commentary post, Chinese Know Real Value: The People's Bank of China—China's central bank—has for the past year been buying up gold in increasing quantities. And last month it issued a statement urging all Chinese citizens to do likewise. China's government recently took steps to deflate a real estate investment bubble that sent apartment rents out of reach for average working people and that has resulted in vast, empty cities of unoccupied apartment and office buildings, as WealthCycles.com reported in February. One of its solutions was to encourage Chinese investors to buy gold. As a result, Chinese demand for gold grew 27% last year, making China the second large consumer of gold in the world, according to a MineWeb.com report this week.
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| China Installs Gold Vending Machine, Plans 2,000 More Posted: 11 Oct 2011 03:13 PM PDT With plans to roll out 2,000 more throughout the country, the Beijing Agricultural Commercial Bank officially installed its first gold ATM during the Chinese National day holiday. by Shivom Seth, MineWeb.com: China has joined the United States, Germany, Italy and the United Arab Emirates, in hosting an ATM machine that dispenses bullion and gold coins. In Beijing's 800-year old Wangfujing shopping district, shoppers can use bank cards and cash to buy certified gold bars and coins. China's first ATM dispensing gold bars and coins was switched on over the weekend of September 25, and then swiftly switched back off again. The equipment had to be shut down the same day because it was not producing receipts due to a small technical glitch, said an industry observer.
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| China’s Pan Asia Gold Exchange: A New Playing Field for Speculators? Posted: 11 Oct 2011 03:07 PM PDT The new gold exchange – which markets itself as China's "gold supermarket" – will allow individuals to buy physical gold
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| Guest Post: Putin's New Vision Of Eurasia Posted: 11 Oct 2011 02:24 PM PDT Submitted by John C.K. Daly of Oilprice.com Putin's New Vision Of Eurasia Many western politicians have harbored deep suspicions of Russian Prime Minister Vladimir Vladimorovich Putin since he first emerged on the Russian political stage in 1999. This is hardly surprising, given his KGB background, though those with longer historical memories will recall that Yuri Andropov came from the same organization and that the West grudgingly found a way to work with him. While the worst aspects of the Cold War faded away with the peaceful collapse of the USSR in late 1991, twenty years later, trying to figure out Kremlin politics remains as vital an exercise as ever, and the "Putin era" has provided Washington analysts desperately reinventing themselves to hang on to their jobs with rich fodder. Is Putin a democrat? Stalinist? Or something in between? Place your bets. What does seem to be apparent, with last week's announcement that current President Dmitrii Medvedev would stand down in next year's presidential elections, is that Putin is a shoe-in to recover the Russian Federation's Presidency, and that, since the term has been extended to six years, Western governments will perhaps have to learn to live with him helming the Russian state until 2026. But one aspect of Russia that has eluded most Washington pundits since 1991 is the fact that Russia a) has developed a free press of sorts, certainly in comparison to the Bad Old Soviet days, and b) that Putin is genuinely popular with many Russians, an observation that many Western liberals find more than a tad irritating. But to return to basics – what Putin represents is an awareness that dawned late in the USSR, only with the advent of Gorbachev – the power of the media. In a weird reversal of perceptions, while Gorbachev essentially ignored domestic opinion to cultivate a Western image of "a man with whom we can do business," to quote Margaret Thatcher, Putin has turned the media equation on its head, appealing to his constituency while essentially ignoring western attitudes. Suitably miffed, the Western media has rounded on Putin, deriding his efforts to construct a "macho" image a la Indiana Jones, riding horse bare-chested through Siberian rivers, practicing karate, etc. etc. etc. But there is another audience for Putin's bravado that the West remains at best dimly aware of – the post-Soviet space. And it is here that his efforts have deeper resonance than most Western observers understand. In May 2005 while President Putin told Russians that the collapse of the Soviet empire "was the greatest geopolitical catastrophe of the century," leaving the denizens of the fourteen other nations to emerge from the Soviet debris field wondering exactly what he meant. On 4 October Putin suggested that ex-Soviet states form a "Eurasian Union" in an article which outlined his first foreign policy initiative as he prepares to return to the Russian presidency, commenting that the organization would build on an existing Customs Union with Belarus and Kazakhstan which beginning in 2012 will remove all barriers to trade, capital and labor movement between the three countries. Needless to say, Putin's suggestion has unsettled conservatives worldwide, who believe that he is trying to reassemble the Soviet Union by stealth. A more dispassionate view of Putin's proposal indicates that it actually contains more than a modicum of sense. First, except for economists of the Soviet era, few understand that the collapse of the USSR tore apart a country where economic development was geared to the union as a whole, rather than its constituent republics. To give but one example – all the electric meters for buildings were produced in Lithuania, so after 1991, a Kazakh, Azeri, Russian or Kyrgyz constructing a building and wanting to measure its electrical usage had to deal with – Lithuania. Given the way that resources, both natural and man-made were distributed across the USSR, the collapse of the country produced consequences which are still playing out. Secondly, it is more than passing strange that Western capitalists, fierce advocates of "free trade," should see a darker purpose in Putin's suggestion – after all, NAFTA in the Western Hemisphere and the EU have developed similar trading principles. In NAFTA, the U.S. is obviously the dominant power, and Germany occupies a similar economic position in the EU, yet few argue that either is seeking to dominate its fellow states. Last but not least, the reality for the bulk of the post-Soviet space, and including the USSR's former protectorate over Eastern Europe, the Russian Federation remains Eurasia's dominant energy superpower, with the exceptions of Azerbaijan, Kazakhstan and Turkmenistan, and only Azerbaijan has managed to wiggle out from under Moscow's thumb for its energy exports to the West. And even those are subject to Russia's pressures, as the brief August 2009 Russo-Georgian war indicated. The economic integration of the European Union has hardly led to increased military tensions between EU members – accordingly, for Western observers, they should at least adopt a 'wait and see" attitude towards Putin's "Eurasian" suggestions, as closer economic integration could in fact benefit former Soviet states who sign up. But, at the end of the day, Western negativity towards the proposal may well be grounded in fears that Western investors may find the dynamics of the playing fields in the post-soviet space shifting. The litmus test in the case will be Kazakhstan, whose booming energy sector in the last two decades has attracted more than $120 billion in foreign investment, and whose President Nursultan Nazarbayev had given his support to the "union." One of the most striking developments in the post-Soviet space has been the rise of nationalism, and there is little in Putin's remarks to indicate that he intends to send Russian tanks rolling to reassert Kremlin control. Sometimes, to quote Sigmund Freud, a cigar is just a cigar, and a customs union is just a customs union – and Moscow has other interlopers to worry about besides Western capitalism – like China, who even the Kremlin's Marlboro Man has yet to figure out how to counter. If the last two decades have shown anything, it is that the new nations of the USSR would prefer to interact with the European union, or, better yet – the United States – but the former seems solely interested in their energy assets, while the latter is interested in buying everything that is not bolted down while delivering hectoring human rights lectures to boot. And Moscow, is, after all, the devil that they know – but Beijing has the yuan, not dollars. Tough call.
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| Guest Post: Putin's New Vision Of Eurasia Posted: 11 Oct 2011 02:24 PM PDT
Submitted by John C.K. Daly of Oilprice.com Putin's New Vision Of Eurasia Many western politicians have harbored deep suspicions of Russian Prime Minister Vladimir Vladimorovich Putin since he first emerged on the Russian political stage in 1999. This is hardly surprising, given his KGB background, though those with longer historical memories will recall that Yuri Andropov came from the same organization and that the West grudgingly found a way to work with him. While the worst aspects of the Cold War faded away with the peaceful collapse of the USSR in late 1991, twenty years later, trying to figure out Kremlin politics remains as vital an exercise as ever, and the "Putin era" has provided Washington analysts desperately reinventing themselves to hang on to their jobs with rich fodder. Is Putin a democrat? Stalinist? Or something in between? Place your bets. What does seem to be apparent, with last week's announcement that current President Dmitrii Medvedev would stand down in next year's presidential elections, is that Putin is a shoe-in to recover the Russian Federation's Presidency, and that, since the term has been extended to six years, Western governments will perhaps have to learn to live with him helming the Russian state until 2026. But one aspect of Russia that has eluded most Washington pundits since 1991 is the fact that Russia a) has developed a free press of sorts, certainly in comparison to the Bad Old Soviet days, and b) that Putin is genuinely popular with many Russians, an observation that many Western liberals find more than a tad irritating. But to return to basics – what Putin represents is an awareness that dawned late in the USSR, only with the advent of Gorbachev – the power of the media. In a weird reversal of perceptions, while Gorbachev essentially ignored domestic opinion to cultivate a Western image of "a man with whom we can do business," to quote Margaret Thatcher, Putin has turned the media equation on its head, appealing to his constituency while essentially ignoring western attitudes. Suitably miffed, the Western media has rounded on Putin, deriding his efforts to construct a "macho" image a la Indiana Jones, riding horse bare-chested through Siberian rivers, practicing karate, etc. etc. etc. But there is another audience for Putin's bravado that the West remains at best dimly aware of – the post-Soviet space. And it is here that his efforts have deeper resonance than most Western observers understand. In May 2005 while President Putin told Russians that the collapse of the Soviet empire "was the greatest geopolitical catastrophe of the century," leaving the denizens of the fourteen other nations to emerge from the Soviet debris field wondering exactly what he meant. On 4 October Putin suggested that ex-Soviet states form a "Eurasian Union" in an article which outlined his first foreign policy initiative as he prepares to return to the Russian presidency, commenting that the organization would build on an existing Customs Union with Belarus and Kazakhstan which beginning in 2012 will remove all barriers to trade, capital and labor movement between the three countries. Needless to say, Putin's suggestion has unsettled conservatives worldwide, who believe that he is trying to reassemble the Soviet Union by stealth. A more dispassionate view of Putin's proposal indicates that it actually contains more than a modicum of sense. First, except for economists of the Soviet era, few understand that the collapse of the USSR tore apart a country where economic development was geared to the union as a whole, rather than its constituent republics. To give but one example – all the electric meters for buildings were produced in Lithuania, so after 1991, a Kazakh, Azeri, Russian or Kyrgyz constructing a building and wanting to measure its electrical usage had to deal with – Lithuania. Given the way that resources, both natural and man-made were distributed across the USSR, the collapse of the country produced consequences which are still playing out. Secondly, it is more than passing strange that Western capitalists, fierce advocates of "free trade," should see a darker purpose in Putin's suggestion – after all, NAFTA in the Western Hemisphere and the EU have developed similar trading principles. In NAFTA, the U.S. is obviously the dominant power, and Germany occupies a similar economic position in the EU, yet few argue that either is seeking to dominate its fellow states. Last but not least, the reality for the bulk of the post-Soviet space, and including the USSR's former protectorate over Eastern Europe, the Russian Federation remains Eurasia's dominant energy superpower, with the exceptions of Azerbaijan, Kazakhstan and Turkmenistan, and only Azerbaijan has managed to wiggle out from under Moscow's thumb for its energy exports to the West. And even those are subject to Russia's pressures, as the brief August 2009 Russo-Georgian war indicated. The economic integration of the European Union has hardly led to increased military tensions between EU members – accordingly, for Western observers, they should at least adopt a 'wait and see" attitude towards Putin's "Eurasian" suggestions, as closer economic integration could in fact benefit former Soviet states who sign up. But, at the end of the day, Western negativity towards the proposal may well be grounded in fears that Western investors may find the dynamics of the playing fields in the post-soviet space shifting. The litmus test in the case will be Kazakhstan, whose booming energy sector in the last two decades has attracted more than $120 billion in foreign investment, and whose President Nursultan Nazarbayev had given his support to the "union." One of the most striking developments in the post-Soviet space has been the rise of nationalism, and there is little in Putin's remarks to indicate that he intends to send Russian tanks rolling to reassert Kremlin control. Sometimes, to quote Sigmund Freud, a cigar is just a cigar, and a customs union is just a customs union – and Moscow has other interlopers to worry about besides Western capitalism – like China, who even the Kremlin's Marlboro Man has yet to figure out how to counter. If the last two decades have shown anything, it is that the new nations of the USSR would prefer to interact with the European union, or, better yet – the United States – but the former seems solely interested in their energy assets, while the latter is interested in buying everything that is not bolted down while delivering hectoring human rights lectures to boot. And Moscow, is, after all, the devil that they know – but Beijing has the yuan, not dollars. Tough call.
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| Harvey Organ's: The Daily Gold & Silver Report Posted: 11 Oct 2011 02:24 PM PDT Gold and silver ounces for October delivery rises/Vote ongoing in Slovakia
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| Deliberately Seeking Beta: Interview with Robert Arvanitis Posted: 11 Oct 2011 01:17 PM PDT I am working on a new project. Here is a hint from the September 29, 2008 issue of The Institutional Risk Analyst -- Chris
Seeking Beta: Interview with Robert Arvanitis The Institutional Risk Analyst September 29, 2008 Robert Arvanitis of Risk Finance Advisers is a Wall Street veteran who has managed to avoid some of the more spectacular disasters in recent financial history. An actuary by training and a member of PRMIA, he learned the reinsurance business from Hank Greenberg at AIG. Seeing the need to broaden the industry model, he moved into investment banking. At Merrill Lynch (NYSE:MER) he was managing director of Global New Derivatives, responsible for the very first "catastrophe" bond, among other innovations. Robert took the money off the table just in time, leaving MER before the dot.com bust. He now has the leisure to pursue the cross-sector arbs between insurance and banking, as we discuss below. The IRA: Bob, we've been wanting to talk to you for some time about the current financial crisis. You have a unique perspective given your work in both the insurance and banking worlds. Arvanitis: My first observation is that we do not learn from the past - we find new and more subtle errors to commit. History does not repeat itself, people repeat the same mistakes over and over. Second, in the case of the financial markets, they are perpetually slicing and dicing what they know because they cannot have access to or understand what they don't know. They only way to break out of these well-worn paths, the familiar X/Y plane is go off in a different direction, call it Z. The insurance industry deals with wind and death and hurricanes, while Wall Street deals with what's described in the Bloomberg terminal. BTW, I also have just described the difference between mark-to-market and buy and hold forever. The IRA: Give us an example of the law of repetition. Arvanitis: Back in the late '80s, a interesting thing happened at Lloyd's of London, the famous insurance marketplace. That venerable institution was driven by a host of forces to seek growth, find new revenue sources. The IRA: Sounds like Wall Street post-deregulation. Arvanitis: Oh yes. Since insurance only grows naturally with the overall economy, the clever brokers at Lloyd's hit on a new scheme. When an insurer has too much risk, it often reinsures itself, or passes risk on to a reinsurer. Reinsurers do likewise to protect themselves, and retrocede risk on to another reinsurer. Well to keep revenues growing, the London brokers started a chain, call it the London Market Excess ("LMX"). They circulated risks 'round and 'round from insurer to reinsurer to retrocessionaire, each time taking out a commission bite, and at each step, losing details about the actual underlying risks. This "LMX Spiral" was a great game for a while. Eventually, of course, claims had to be settled. With the loss of detail at each turn of the spiral, that was hard. Even worse, after all the brokers' commissions, there was no money left to actually pay claims. The IRA: Why does AIG, MBIA (NYSE:MBI) and Ambac (NYSE:ABK) spring to mind? Also nicely describes securitization. Arvanitis: Precisely. Roll forward twenty years. An interesting thing happened on Wall Street. The banks found themselves driven by a host of forces to seek growth, find new revenue sources. Since true investment and commercial banking only grows naturally with the overall economy, the clever bankers of Wall Street hit on a new scheme. When a bank has too much risk, it often sells assets, or borrows, or both, since that's cheaper than raising equity. But then the bank needs to create new assets, for fee income, for market share, and not least to keep its origination channels busy and loyal. The IRA: We call it "yield to commission." Arvanitis: Well to keep revenues growing, Wall Street started a chain, call it the CDO excess spiral. Package assets. Circulate them. Buy pieces, re-package and re-circulate, taking out a commission bite at each step. This CDO spiral was a great game for a while. Eventually of course, assets had to perform. With the same risks in every package, correlations soared to 1. In the end, there was no money in the smallest Matryoshka doll. The IRA: Why do such spirals happen? Arvanitis: Well, it happened at Lloyds because with insurance, the brokers who distribute are distinct from, and competitive with, the underwriters who take the risks. This came about because from the start in shipping, a sinking loss was far too big for any one underwriter, so all risks were syndicated. Distribution grew up as an independent function. Capital markets are more sophisticated. Distribution and underwriting are under one roof, albeit separated by a Chinese wall. So we don't find one function merely cozening the other. No, in banking we must resort to more subtle errors, deeper flaws in the system. The IRA: Why does this not make us feel good… Arvanitis: Because you and Dennis are honest analysts who don't work for broker dealers, at least in your case not any longer. I too am a refugee. The flaw in capital markets is the Rube Goldberg apparatus that passes for regulation. Whatever else history decides, the current financial contretemps did not result from lack of regulation. Rather, it arose from human weakness on both sides-industry and government. The amorality of industry is widely discussed. What is not so often recognized is the human weakness in government. The IRA: Those weaknesses are very visible this week. Arvanitis: Congress delegates to SEC, which delegates to PCAOB/FASB, which delegate to auditors, who hope that giving information to shareholders, on the theory that it will let them govern the boards, who in their own turn just may be able to rein in management. Meanwhile, Congress via ERISA tries to define "prudent." They do this by delegating great power - but not accountability - to rating agencies. Yet the NRSROs are paid by the Buy and Sell Side interests to say "Yes." Coming along after the fact, shareholder suits are a very blunt corrective. They increase uncertainty, and raise D&O premiums, but have no effect on management and emphatically do not discipline boards. This scheme is worse than no feedback mechanism at all for it deceives us into believing someone, somewhere, is responsible. The IRA: As our friend Timothy Dickinson noted in an interview this year, the idea that institutions are led by people sufficiently informed to make rational decisions is an illusion ('The Tyranny of Reason: Interview with Timothy Dickinson', July 30, 2008). Arvanitis: Precisely. With so many moving parts, no specific bureaucrat can ever be called to account. Being mortal, the bureaucrats desire to avoid pain is as dear to them as the desire by their counterparts in private industry to seek gain. And it is far more profitable to game the rules, for example, than to enforce them. And any system can be gamed. Witness the over-reaction of SarbOx, and the subsequent avoidance. The IRA: So your answer is to focus on the Z axis, namely low beta transactions. Give our readers a clear, simple definition of the difference between Alpha and Beta. Arvanitis: Alpha, to use the securities market example, is when an investor performs above the perceived level of risk. As risk goes to zero, if you have anything left, then you are making free money. Another way to put it is "I'm a genius." Of course, in the markets some people lose money, thus others make money due to those mistakes. But I personally believe that there is no "free" alpha. That said, there is a way to earn returns that may look like alpha, especially if you are an astute student of human nature. You can make a bet when other people are behaving irrationally, as when you buy when there is blood in the street. The IRA: Or Warren Buffet buying a chunk of Goldman Sachs (NYSE:GS) as it was pushed into the arms of the Fed? Arvanitis: Yes, but that is not really alpha. It does not come from the market but instead from human fallacy and exploitation thereof, like being a good salesman. So that is alpha. Beta means correlation to the market. If it is correlated to the market, then you should get paid like anybody else, namely union wages. If you take X risk then you get Y return, that is the market rate. No better, no worse, just the average. The IRA: But you have chosen to focus your firm on brokering "low beta" risks. What is that? Arvanitis: Low beta is uncorrelated, non-market risk. This is the type of risk that insurers used to price, the sinking of ships, hurricanes. Non-market, uncorrelated risks. Now 300 years before Harry Markowitz, landed English gentry instinctively realized that their money came from land rents and crops, so they put some of their money to work by investing in Lloyds of London. If the crop was good this year, but a few ships sank, you made money on crops and lost on ships. The next year, the crops were lousy but no ships sank, so you made money on insurance. Lloyds was the insurance industry's first effort at diversification and they stuck to their knitting and underwrote real world risk events like hurricanes and fires, which were uncorrelated to other markets. The IRA: So what happened to the insurance industry? How did AIG, MBI and ABK get lured away from low beta into something as reckless and speculative as credit default swaps ("CDS")? Arvanitis: The insurance industry grew out of its crib and now does more and more underwriting in high-beta risks. They sell liability insurance, D&O coverage, surety, and, good lord, they even get into bond insurance. CDS is a bridge even further removed from the basic, low-beta model from which insurance comes. The risk taken by insurers is more and more high beta, and by doing so they spoiled a perfectly good racket. The IRA: Precisely. Why on earth would AIG or the monolines leave a low risk, double digit rate of return business to gamble on municipal bond issuers or CDS? Makes no sense. Were they just chasing earnings growth? Arvanitis: If they were chasing earnings they'd be smart. They were chasing revenue. D&O liability is very high beta and far, far removed from the relatively uncorrelated risks upon which the insurance industry was built. Now this is where a great opportunity exists to create a new class of assets to feed to the insurers, pension funds, etc, who don't forget, still live largely in the world of buy-and-hold. By creating an asset based on whether there won't be a hurricane or that the wind does not blow in the Midwest at the wind farm, or that there is not sufficient traffic on the toll road, we can created a counter-cyclical bet. There are numerous ways to carve counter-cyclical trades out of capital markets transactions. The IRA: So what's the problem? Why isn't Wall Street all over these types of low-beta transactions? Arvanitis: Because the data needed to construct these transactions is not found on the Bloomberg and, let's face it, Wall Street rarely rewards imagination. If they did, you and I would be running Goldman Sachs or Morgan Stanley and those business models would be very different. It is hard to get a low beta transaction through the commitment or risk committee of a major bank because they cannot find a quote on wind or weather patterns on the Bloomberg terminal. The IRA: Yes, we've been there. Back in the late 1990s, IRA co-founder Chris Whalen tried to get his colleagues at Bear, Stearns to look at a small, KS-based start up that wrote the original standard for the 802.11 wireless internet protocols. They said the opportunity was too small. We eventually showed the idea to Sony (NYSE:SNE), but they didn't get it either. But back on track, how do we deal with the mess on Wall Street? What would you tell members of Congress if you were in Washington today? Arvanitis: As you state in the comment above this interview, it is all about capital. Firms need capital to demonstrate that they CAN hold assets to maturity. Therefore, they do NOT need to liquidate assets at distressed levels, so those assets ARE valuable. This, in turn, means the firm's equity is in good shape, so that it in fact HAS capital. The logic is quite circular. Capital is what you have in order that you do not ever need it. The IRA: But now capital is in doubt because of the fear of insolvency, thus the need for new capital is infinite. Arvanitis: Banks need capital against risk, but they also need new revenues to feed that capital. Hence the constant search for holes in the regulatory scheme, especially for wide margin assets. Of course the widest margins are in the most illiquid assets, and off we go. The FASB mark-to-market rule is truly an economists' nightmare. How can mark-to-market possibly matter in a market filled with illiquid assets? It merely lines up the dominos! The IRA: Sadly, yes. As we pointed out last week, the FASB pricked the structured asset bubble that has caused the meltdown on Wall Street. I doubt any of the members of the FASB board understood the significance of their actions at the time. But by next year, enraged politicians and business leaders are going to be calling for the abolition of the FASB. If we were SEC Chairman Christopher Cox, FASB Chairman Bob Hertz or the other members of the FASB Board who voted to implement FAS 157, immigration would be on the top of the list of priorities for 2009. Arvanitis: Well, here's the rub. We want to trade in the most illiquid assets, but can't afford to capitalize them without getting back on the circular mark-to-market spiral. Take my experience at MER as an example. When we did the very first "catastrophe" bond for USAA, we had to agent, not underwrite. Risk management officials at MER had no way to capitalize the bond for less than 100% if we positioned it. To solve this seeming problem, we must stop dealing with the full spread (on credit, or the equivalent full premium for equity.) Instead, we parse the spread into component drivers. The IRA: Sounds a lot like the proposal from several PRMIA members we included in the top of this comment. Do continue. Arvanitis: Traditionally, the market considers alpha, or "I'm a genius" returns, separately from beta, or "everyone gets paid" returns. The idea that there is ever a real alpha has been debunked repeatedly. Think "survivorship fallacy." So we're left with beta. It's in the low-beta markets that real value lies. But those are the risks which Wall Street finds so very hard to mark-to market or to capitalize. The IRA: So is it an impossible task to reorient Wall Street to new opportunities? Arvanitis: No. Enter the insurance sector, from above. Insurers emphatically do NOT price on blinking Bloomberg quotes. They use actuarial methods to price from first principles. And as hungry for revenue as they are, there is an enormous arbitrage opportunity between Wall Street's reaction-"we don't know what to do with this, so it's 100% capital"- and the insurer's price "We'll take it for 7¢." The IRA: When the smoke clears from the meltdown on Wall Street, we'll come back to the "how to do it" discussion regarding low beta. Thanks Bob.
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| John Embry - If We Repeat 2008, Stocks Could Fall 40% From Here Posted: 11 Oct 2011 12:30 PM PDT I still don't have a problem with $2,000 gold and $50 silver before the year is out....
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| Gold is not in a Bubble: It’s on its way to $10,000 an ounce Posted: 11 Oct 2011 11:48 AM PDT $10,000 Gold—Why it will get there sooner than you may expect, why gold is not in a bubble and will continue rising in value for years to come.
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| Banks are toast, trillions more in bailouts coming, Embry tells King World News Posted: 11 Oct 2011 11:32 AM PDT 12:30a BST Wednesday, October 12, 2011 Dear Friend of GATA and Gold (and Silver): Sprott Asset Management's John Embry today tells King World News that the nationalization of Dexia shows that the European banking system is toast, that trillions more of fiat currency are on their way to bail out the rest of the insolvent world, that all markets are being manipulated now, and that gold and silver investors should not be demoralized out of their positions. You can find an excerpt from the interview at the King World News blog here: http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/10/12_E... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Prophecy Platinum Drills 120.9 Meters Company Press Release VANCOUVER, British Columbia, Canada -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) has announced the drill results received from its 2011 drilling Wellgreen platinum group elements, nickel, and copper project in the Yukon Territory. Borehole WS11-188 encountered 457 meters of mineralization grading 0.47% nickel equivalent (including 0.72 grams per ton platinum, paladium, and gold) from surface to the footwall contact. Within this larger swath of mineralization, the hole encountered a high-grade section of 17.8 meters of 3.14 grams per ton platinum, palladium, and gold, 1.03% nickel, and 0.74% copper (1.77% nickel equivalent). The hole was drilled completely outside of current resource boundaries, between the East Zone resource and the West Zone resource that was reported in the company's press release no July 14, 2011. The high-grade intercept located between the two resources not only demonstrates that the East and West Zone resource form a single, geologically contiguous body but also indicates that the higher-grade material in the East Zone continues to the west and at depth at Wellgreen. For drill result tables and maps, please see the company's full press release here: http://www.prophecyplat.com/news_2011_sep26_prophecy_platinum_wellgreen_... Join GATA here: The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ 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: 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: 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: To contribute to GATA, please visit: ADVERTISEMENT Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, 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
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| The Silver and Gold Price Bull Market Has Not Near Ended, Lots More Time and Upside Left Posted: 11 Oct 2011 11:32 AM PDT Gold Price Close Today : 1669.60 Change : 35.10 or 2.1% Silver Price Close Today : 31.944 Change : 0.986 or 3.2% Gold Silver Ratio Today : 52.27 Change : -0.531 or -1.0% Silver Gold Ratio Today : 0.01913 Change : 0.000192 or 1.0% Platinum Price Close Today : 1520.70 Change : 0.40 or 0.0% Palladium Price Close Today : 613.75 Change : 0.00 or 0.0% S&P 500 : 1,194.89 Change : 39.43 or 3.4% Dow In GOLD$ : $141.56 Change : $ 1.15 or 0.8% Dow in GOLD oz : 6.848 Change : 0.056 or 0.8% Dow in SILVER oz : 357.91 Change : -0.74 or -0.2% Dow Industrial : 11,433.18 Change : 330.06 or 3.0% US Dollar Index : 77.53 Change : -1.210 or -1.5% I can't avoid pointing out that the GOLD PRICE had yet another opportunity to pierce $1,675 today, and failed for the third time. Generally, third time's the charm, and if it fails it won't come back. Gold reached its flood tide at $1,681.57, but closed down $9.90 at $1,659.70. The GOLD PRICE has taken away one more reason to expect an immediate rally. O, and the SILVER PRICE close today! Silver rose one cent to close Comex at 3196.3, after a high of 3235c. That 3250c resistance held firm, and silver blinked. Possible it's building a flat topped rising triangle, with the flat top at 3250c, because the lows have been higher. Still, a silver dip under 3150c, not to mention 3100c, will send the SILVER PRICE tumbling again. It's easy to misunderstand my outlook. I sound very negative on SILVER and GOLD, but that's a very short term view. I don't think the European crisis has ended, and on top of that a silver and gold correction to a 34-month rise is taking place. Yet all that will pass. And what if it drove silver and gold down another 20%? I don't care, because I am holding for the triple or quadruple we will see from that low. No, the SILVER and GOLD bull market has not near about ended. Lots more time and upside left. Don't forget that. Logically -- mathematically -- the price of US government bonds ought to drop when the US dollar drops. Lower dollar means investors will demand more interest to make up for the lower dollar price, and bond prices move the opposite direction to their interest rates (yields). And as bonds have dropped, yields have risen. Maybe it's only a blip on the screen as the US dollar corrects its rally, but still it contradicts the Fed's Operation Twist that aims to lower long term rates, and the Fed's stated goal of keeping all interest rates down. Why am I bothering with this? If ever a stampede develops out of US government debt because the public is repudiating the dollar, it will start this way, with the US government having to pay higher and higher interest to compensate for expected inflation and dollar instability. Not saying that's happening now, just that its possible. The US DOLLAR index with a low at 77.34 today (closed 77.49, down 1.56%) right nearly touched the upper trading channel line of the channel the dollar broke out of to the upside. This classifies as that "Final Kiss Good-Bye" I mentioned yesterday. It's a move markets often make, breaking out to a new high (or low), then trading back to the same support/resistance that marked the breakout point. Now the dollar might fall a little lower, maybe to 76.75, or even to the 200 day moving average at 76, but none of those moves will gainsay the dollar's rally. Y'all will see soon the US dollar index priced in the 80s. Euro traded sideways, closed 1.36456, up -- get out your electron microscope -- 0.03%. The Japanese yen continues to torture its Nice Government Men and exporters by remaining stubbornly high. Closed today flat, up 0.02% at 130.45c/Y100 (Y76.65/$1). To set up the European bailout, 17 member states needed to agree unanimously. Today the last, Slovakia (population 5,429,763, fewer than Tennessee) voted AGAINST the bailout. The Germans have a word, "Schadenfreude" that means "gloating at someone's fall." Right now, I am fighting Schadenfreude over the eurocrats failure to bail out the banks. Probably, I am not fighting it hard enough. Good chance of that. Yep. Stocks today bounced off that bottom line of the Jaws of Death top I mentioned yesterday. Dow fell 16.88 (0.15%) to a 11,416.30 close. S&P flattened, up 0.65 [sic] to 1,195.54. I may not like stocks (and I don't, no more'n y'all like a copperhead snake) but I try to tear off the top of the chart and read faithfully what it says. They may rally, but I don't want any part of them. First off, that little rally shouldn't carry too far, according to overbought/oversold indicators. But let's say stocks go wild and shoot their biggest bolt and reach for that 200 dma way in the sky above at 11,968.90 -- what then? Still don't amount to a hill of beans, and they're in a bear market to boot. On the other hand, stocks are a fine candidate to fail right here and fall more. Wall Street 2011 -- what 250,000 Confederate soldiers died to prevent. 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. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose. 
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| Keiser Report: Ground Zero of Financial Terrorism (E195) Posted: 11 Oct 2011 10:26 AM PDT interviews Charles Hugh Smith, #occupywallstreet, Crash JP Morgan - Buy Silver and other solutions to a dangerous banking system.
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| Could a Tea Party Occupy Wall Street? Posted: 11 Oct 2011 09:51 AM PDT What a difference nearly three years makes. On Inauguration Day 2009, 2 million people converged on Washington, D.C. "Two million people don't gather in one place unless things are really good, or really bad," we observed that day. "We're having trouble telling the difference these days… One thing is certain: Obama sure has a lot of hype to live up to. Guess that's inevitable when you allow the nation to project all their fears and hopes on you."
"I am new enough on the national political scene," wrote the president two years after his election to the U.S. Senate, "that I serve as a blank screen on which people of vastly different political stripes project their own views." "As such, I am bound to disappoint some, if not all, of them." Well, at least he had some idea what he was getting into. But he couldn't shake the delusion that the solution to whatever ails "the economy" lies in politics. Thus, nearly three years later, the palpable disappointment is manifesting itself, like the now-dashed high hopes, outdoors…
The "Occupy Wall Street" crowd is marching uptown today to protest at the homes of J.P. Morgan Chase CEO Jamie Dimon and Koch Industries chief David Koch, among others. "Objectively," writes retired CIA station chief Haviland Smith, "the demonstrators seem broadly preoccupied with their own powerlessness. They decry the inordinate amount of power and influence held by our very rich and our corporate enterprises and the power of lobbyists to further their goals in a Congress that is essentially for sale." Reading this assessment, we're struck — and we know we're going to make people uncomfortable saying this — by the parallels between Occupy Wall Street and the Tea Party. Both movements are born in part from outrage over the 2008-09 bank bailouts. Both feel the "American dream," however they define it, is out of their reach. Both feel left out by a ruling class. The Tea Party drove one long-time Republican operative to quit after 30 years as a Capitol Hill staffer. But Mike Lofgren recognized where their grievances came from. "Historical circumstances," he wrote last month, "produced the raw material: the deindustrialization and financialization of America since about 1970 has spawned an increasingly downscale white middle class — without job security (or even without jobs), with pensions and health benefits evaporating and with their principal asset deflating in the collapse of the housing bubble. Their fears are not imaginary; their standard of living is shrinking." How different is that, really, from the motives impelling the OWS protesters to the streets? For all we know, the OWS protesters are the college grads with no jobs stuck living in their Tea Party parents' basement. Heck, even some of the Tea Partiers might support the OWS protesters notions of "tax the rich." Eight out of 10 Americans support raising taxes on households earning more than $250,000 a year, according to a new Bloomberg/Washington Post poll. That includes 81% of Democrats, 67% of independents, and 51% of Republicans. The poll also finds 82% ruling out any cuts to Medicare, and 83% opposing any cuts to Social Security. Presumably that would include the Tea Partiers who were insisting two years ago, "Keep your government hands off my Medicare." Sure gets ugly when people can no longer project their views onto the president. Addison Wiggin Could a Tea Party Occupy Wall Street? originally appeared in the Daily Reckoning. The Daily Reckoning provides over 400,000 readers economic news, market analysis, and contrarian investment ideas.
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| Another version of the 'stump speech' on gold price suppression Posted: 11 Oct 2011 08:55 AM PDT 10p BST Tuesday, October 1, 2011 Dear Friend of GATA and Gold: The third or fourth incarnation of what has become your secretary/treasurer's "stump speech" on gold price suppression was prepared yesterday for a dinner of financial people in London that may have been most notable for one fund manager's disparagement of GATA's work. Why are we complaining about manipulation of the gold market, he asked, when everyone knows that governments these days are manipulating all markets? Hinde Capital CEO Ben Davies, who was in the audience, quickly interjected that such manipulation raises a moral question, but that disparaging fund manager didn't seem to be having any of it. He seemed to figure that it was simply his job to try to make money for his clients whatever the circumstances facing him. No one could criticize him for upholding his obligation to his clients. But a prominent financial journalist was also present at the dinner, and it would be shocking news to her publication's readers that governments are now manipulating all markets, including the gold market. For despite many importunings her publication has yet to report that sort of thing. Well, maybe someday. If you've followed GATA for a while you'll already have seen most of what's in the latest version of the "stump speech," though it has been updated to reflect developments of recent weeks. It is headlined "Gold Price Suppression Purposes and Proofs" and has been posted in the GATA "Documentation" archive here: http://www.gata.org/node/10554 CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit, 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 Join GATA here: The Silver Summit http://cambridgehouse.com/conference-details/the-silver-summit-2011/48 New Orleans Investment Conference http://www.neworleansconference.com/ 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: 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: 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: To contribute to GATA, please visit: ADVERTISEMENT Prophecy Platinum Drills 120.9 Meters Company Press Release VANCOUVER, British Columbia, Canada -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) has announced the drill results received from its 2011 drilling Wellgreen platinum group elements, nickel, and copper project in the Yukon Territory. Borehole WS11-188 encountered 457 meters of mineralization grading 0.47% nickel equivalent (including 0.72 grams per ton platinum, paladium, and gold) from surface to the footwall contact. Within this larger swath of mineralization, the hole encountered a high-grade section of 17.8 meters of 3.14 grams per ton platinum, palladium, and gold, 1.03% nickel, and 0.74% copper (1.77% nickel equivalent). The hole was drilled completely outside of current resource boundaries, between the East Zone resource and the West Zone resource that was reported in the company's press release no July 14, 2011. The high-grade intercept located between the two resources not only demonstrates that the East and West Zone resource form a single, geologically contiguous body but also indicates that the higher-grade material in the East Zone continues to the west and at depth at Wellgreen. For drill result tables and maps, please see the company's full press release here: http://www.prophecyplat.com/news_2011_sep26_prophecy_platinum_wellgreen_...
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| Posted: 11 Oct 2011 08:50 AM PDT Addison Wiggin – October 11, 2011
"Two million people don't gather in one place unless things are really good, or really bad," we observed that day. "We're having trouble telling the difference these days… One thing is certain: Obama sure has a lot of hype to live up to. Guess that's inevitable when you allow the nation to project all their fears and hopes on you." 
"As such, I am bound to disappoint some, if not all, of them." Well, at least he had some idea what he was getting into. But he couldn't shake the delusion that the solution to whatever ails "the economy" lies in politics. Thus, nearly three years later, the palpable disappointment is manifesting itself, like the now-dashed high hopes, outdoors… 
"Objectively," writes retired CIA station chief Haviland Smith, "the demonstrators seem broadly preoccupied with their own powerlessness. They decry the inordinate amount of power and influence held by our very rich and our corporate enterprises and the power of lobbyists to further their goals in a Congress that is essentially for sale."
Both movements are born in part from outrage over the 2008-09 bank bailouts. Both feel the "American dream," however they define it, is out of their reach. Both feel left out by a ruling class. The Tea Party drove one long-time Republican operative to quit after 30 years as a Capitol Hill staffer. But Mike Lofgren recognized where their grievances came from. "Historical circumstances," he wrote last month, "produced the raw material: the deindustrialization and financialization of America since about 1970 has spawned an increasingly downscale white middle class — without job security (or even without jobs), with pensions and health benefits evaporating and with their principal asset deflating in the collapse of the housing bubble. Their fears are not imaginary; their standard of living is shrinking." How different is that, really, from the motives impelling the OWS protesters to the streets? For all we know, the OWS protesters are the college grads with no jobs stuck living in their Tea Party parents' basement. Heck, even some of the Tea Partiers might support the OWS protesters notions of "tax the rich."
That includes 81% of Democrats, 67% of independents, and 51% of Republicans. The poll also finds 82% ruling out any cuts to Medicare, and 83% opposing any cuts to Social Security. Presumably that would include the Tea Partiers who were insisting two years ago, "Keep your government hands off my Medicare." Sure gets ugly when people can no longer project their views onto the president.
In other words, most of the middle class has already resigned itself to getting hosed one way or another — even worse than they already have. Unless they're out of work. Then they join the protests. They'd have the time. The unemployment numbers are going to bear extra-close scrutiny from now on. Protests have been reported in 100 U.S. cities. In several of those cities, police have fought the protesters. Overnight in Boston, about 100 people were arrested, some of them claiming to be U.S. military veterans. The night before, more than 30 people were arrested in Des Moines.
"After they took the streetlight from in front of my business," says Bobby Hargrove, "someone climbed onto my roof and stole an air conditioning unit." Whether it's hordes of unemployed taking to the streets, or nickel-and-dime cutbacks in the services you've come to expect, the crisis unfolding right now will affect you somehow. This is what happens when the mother of all financial bubbles starts to pop. That's why we put in the time and effort to update our summer forecast with the most recent information available… so you can make the right moves to protect yourself. We've just put it online… Here's where you can check it out.
Of the 17 countries that conduct business using the euro, plucky Slovakia is the only one whose parliament is yet to sign off on an expansion of the eurozone bailout fund. One of the parties in the governing coalition refuses to go along. "The greatest threat to the euro is the bailout fund itself," says Freedom and Solidarity Party chief Richard Sulik. "It's an attempt to use fresh debt to solve the debt crisis. That will never work." "The Slovaks were historically a poor but frugal people," says the Mises Institute's Robert Murphy, who visited Slovakia last month, "and many of them resented bailing out the Greeks, who were spendthrifts yet had a higher standard of living." TIME – Until the results of the Slovakia vote come in, U.S. stock indexes are mostly flat. The Dow remains above 11,400 after a massive run-up yesterday, driven by the delusion that the eurozone's problems had actually been fixed. After today's close, the market will likely shift attention from the economy and monetary policy as earnings season gets under way. As usual, Alcoa will be first to report.
The monthly Optimism Index put out by the National Federation of Independent Business ticked up to 88.9 — still one of the worst readings in the last year, and far below pre-2008 levels. Fewer small business owners say they plan to hire… which won't do much to get those unemployed throngs off the street.
The total stands at 34,673,500. This is the fourth straight year of record sales.
Last month, they confirmed 200 tons of silver — the largest underwater stash of metal ever — lay aboard the SS Gairsoppa, a British cargo ship sunk by the Germans in 1941. Now they've gotten a positive ID on the British steamship Mantola — sunk by the Germans in 1917 off the coast of Ireland.  The silver stash won't be as big this time — maybe 20 tons — but the work is just getting started. As with the Gairsoppa, Odyssey has already cut a deal to keep 80% of the find, turning over the other 20% to the British government. The company has learned its lesson the hard way with the Black Swan find, as we tell in our documentary. Reserve members will get to screen a preliminary cut Thursday night here in Baltimore. Stay tuned for updates…
"With regard to making political comments relating to investments, one of the classical economists — John Stuart Mill or Adam Smith or the like — stated that there was no such thing as economics — there is only political economy. They didn't even call themselves economists — they were 'political economists' in their own eyes. Even centuries ago, they were wise enough to understand that politics and economy are intertwined and cannot be separated." "Especially in these times, discussion of investments devoid of political policy considerations is virtually useless. And if profiting from gold the last 10 years is not a political policy investment call, I don't know what is." "Thanks for the reality."
"I spent a lot of time in Singapore in the '70s and '80s. Incredible country, the best governed country — ever." "Westerners scoff at their laws such as the restriction on chewing gum (people were spitting gum out in the subways cars, which jammed up subway doors, which made the trains run late, so they banned chewing gum to protect the economy). There's an automatic death penalty for drug traffickers and rapists. White-collar crooks like Bernie Madoff get life with hard labor, plus lashes. Smash windows and loot stores like rioters like to do and you get 10 years hard labor, plus lashes. And so on." "But because of good governance and strict law enforcement, Singapore is the safest, cleanest, happiest, most polite, most advanced and best-to-do-business-in country in the world. (Our bleeding heart liberals would not be happy in Singapore.)" "Taxes are low even though they have cradle-to-grave government services, free medical care and free university education. How is that possible? They have one just political party, they don't waste money on useless things like we do in Western countries and they don't give in to special interest groups or unions if it will hurt business or the economy."
"Concurrently, those Fort Knox records were not/have not been acknowledged as in existence. Presumably, the Chinese would have (quietly) wanted a trace [chain of custody] on the bar in that Hong Kong vault." "Seriously, the only leverage the U.S. has, apart from being a military bully — those days numbered by its people, if not the Chinese military buildup — is holding an outsized amount of gold on its soil — its own and that owned by other countries. Absent that, the changing world economic picture accelerates." "Of course, through lending and magic, maybe the bullion banks wrangled the gold all away, so when it really hits the fan they remain in absolute control. Without records, who is to say the banks stole it or traded it for thin air?" "This development — the mere suggestion of little or no gold at Fort Knox in a fairly major public story — places Hugo Chavez's request for Venezuela's gold to be returned to it, though from London, in a whole new arena." "The financial world is definitely interconnected, as Dexia bank shows." The 5: Indeed… and you ignore that fact at your peril. Cheers, Addison Wiggin P.S. "I did like your comment," writes our last reader: "The 5: Um… well… that's how we stay in business. To maintain our editorial independence, with two exceptions, we don't accept advertising. So you — our paying subscribers — are our most important source of revenue." "Funny how it works, produce a product people want at a price they will pay, and everyone benefits." "In addition, what the zombies don't understand, a product that is sustainable and reaps profit must have a real value to the consumer who decides it is worth his labor, which he trades to purchase your product, If he didn't deem your product worth his time, he wouldn't purchase it." "Weird. You have been successful, so your customers must have received at the minimum their $99 dollar value. If I couldn't earn a 99 dollar return from the insights of this service… I would be a MORON." "Keep up the… ah, cheap service… price wise, that is!"
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| Don Coxe Update – Dexia and Gold Posted: 11 Oct 2011 08:39 AM PDT
How do you construct a portfolio in this market?
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| Gold Short Term Channel Defines Trend – Focus is on 1740 Posted: 11 Oct 2011 08:22 AM PDT courtesy of DailyFX.com October 11, 2011 07:18 AM 300 Minute Bars Prepared by Jamie Saettele, CMT Gold has held up for 2 weeks now. As long as price is within the bullish channel forming from the low, favor the upside towards the 100% extension of the rally from the low at 1742. Watch the channel line of course as well for support and resistance. Trend Strength (M,W,D) – 1, 0, 0 Latest Video Weekly Forecast COT...
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| Slovakia Rejects Plan To Expand EFSF, Government Falls Posted: 11 Oct 2011 08:15 AM PDT
From Reuters:
Details From Bloomberg:
More:
Insert clip about the Spanish inquisition.
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| Gold Daily and Silver Weekly Charts Posted: 11 Oct 2011 08:10 AM PDT | ||
| THE WELL-OFF SHOP WHILE THE PEASANTS GRAB THEIR PITCHFORKS Posted: 11 Oct 2011 08:05 AM PDT John Rubino of the Dollar Collapse consistently nails it. LINK TO FULL ARTICLE Times are tough… … but not for everyone: Stocks Tumble; Wealthy Keep Shopping When stock markets tumble, wealthy U.S. shoppers typically cut back their visits to such luxury emporiums as Saks Inc. (SKS) and Nordstrom Inc. (JWN). Yet even as the [...]
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| Marc Faber: Introduce Flat Tax, Reduce Regolatory Environment Posted: 11 Oct 2011 07:53 AM PDT Suffocating global debt problems and overreaching intervention programs will be good for the U.S. dollar but bad for asset prices otherwise, investment guru Marc Faber said. The uneasy time for financial markets will lead to an extended period of high volatility—both up and down—for the markets as economies grow slowly, the author of the Gloom Boom and Doom report said in a CNBC interview. His dollar call is based on the notion that investors will turn to the safety of the U.S. currency even as governments try to inject liquidity into the market to save the ailing financial system. "Despite the fact that the (European Central Bank) and the European government will flood the market with liquidity to bail themselves out, global liquidity is tightening," Faber said. "Whenever global liquidity is tightening it is bad for asset prices but good for the U.S. dollar, as was the case in 2008." The dollar has been on the rise recently against global currencies, gaining more than 5 percent since late August. The U.S. currency has posted a nearly 7 percent gain against the euro during the same period as policy makers have struggled to come up with a solution to the Greek debt crisis. However, a strong dollar for several years has been poison for risk assets, particularly a stock market that has come to depend on a weak currency to boost exports as domestic consumption has lagged. For Faber, government meddling in the free markets is one of the primary reasons why growth will lag and recession looms. "We've had far too many interventions in the Western world where the share of total economy that goes to government and is government-sponsored has grown," he said. "That essentially makes it very difficult for the Western world to grow sustainably…I don't see how the Western world including the U.S., Japan and Western Europe can grow. They're going to stagnate." Faber suggested that Occupy Wall Street protesters "go to Washington and occupy the Federal Reserve along the way." "We have expansionary fiscal policies, we have expansionary monetary policies but we have restrictive regulatory policies and it curtails any initiative by the small businessman and the large businessman," he said. "He doesn't employ and invest capital in the U.S. He does that in China or somewhere else in the world where the regulatory environment is more favorable." Source: CNBC
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What a difference nearly three years makes. On Inauguration Day 2009, 2 million people converged on Washington, D.C.
"I am new enough on the national political scene," wrote the president two years after his election to the U.S. Senate, "that I serve as a blank screen on which people of vastly different political stripes project their own views."
The "Occupy Wall Street" crowd is marching uptown today to protest at the homes of J.P. Morgan Chase CEO Jamie Dimon and Koch Industries chief David Koch, among others.
Reading this assessment, we're struck — and we know we're going to make people uncomfortable saying this — by the parallels between Occupy Wall Street and the Tea Party.
Eight out of 10 Americans support raising taxes on households earning more than $250,000 a year, according to a new Bloomberg/Washington Post poll.
Where does all this end? No one can say with absolute certainty. But the same poll says 81% of adults expect the middle class to make some sort of sacrifice to get the national debt under control.
And even if you don't live in a protest city, other signs of decay abound…
Markets are treading water today awaiting developments in, of all places, Slovakia.
Sentiment among the nation's small business owners is improving, but still lousy.
Like stocks, precious metals are holding steady. Gold is where it was around this time 24 hours ago, at $1,659. Silver is a shade below $32.
With nearly three months of 2011 remaining, the U.S. Mint has already set an annual record for Silver Eagle sales.
Chalk up another big find for the folks at Odyssey Marine.
"I always enjoy your irreverence. If you can't make fun of the human race, what's left."
"Lee Kwan Yew's 
"Chinese officials found a gold bar in a Hong Kong vault that was tungsten wrapped in gold plate," writes a third, continuing our thread about all the gold that is or isn't in Fort Knox. "About the same time, a high level U.S. government official who had been in charge of Fort Knox gold records going back decades resigned and no one could find him.
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