Gold World News Flash |
- GoldSeek.com Radio: Richard Daughty & President Gary Cope, Robert Ian, The International Forecaster, and your host Chris Waltzek
- International Forecaster October 2011 (#9) - Gold, Silver, Economy + More
- Exotic Congo Holds Hidden Values
- THE UNFORTUNATE TRUTH ABOUT AN OVERBOUGHT STOCK MARKET
- Beyond the Pale: What Last Year's (Alleged) Steven J. Baum Halloween Costumes Reveal
- Pento - Here is Why Gold & Silver Skyrocketed This Week
- Michael Pento: Here is Why Gold & Silver Skyrocketed This Week
- Silver Guru Eric Sprott Talks Shop Concerning Silver Shortages
- [TaM-1222] The Truth About Yesterday’s Asparagus Soup & a Little Bit of Schving Schving
- Why The Latest Eurozone Bail-Out is Destined to Fail Within Weeks
- How Much Gold Stock is There Really?
- 'Tis The Season For Seasonal Obfuscation
- 'Tis The Season For Seasonal Obfuscation
- ?Gold is Useless!? and 6 Other Reasons To Hate Gold As An Investment
- 2018: Europe At War
- Philip Barton: How much gold stock is there really?
- Haynes, Norcini enthusiastic about immediate prospects for gold and silver
- By the Numbers for the Week Ending October 28
- Why Sound Money is a Basic Human Right: Alasdair Macleod
- The Best of the Week
- Saving The Eurozone, Will it Work?
- The Never Ending Euro Fiasco
- How Will Gold and Silver React to the EU Bailout Plan?
- Guest Post: Eric Janszen: We Are Witnessing The Death Of The Dollar
- Be Honest – The European Debt Deal Was Really A Greek Debt Default
- Confessions of a Gold Scammer
| Posted: 30 Oct 2011 02:00 PM PDT Headline news & the Market Weatherman Report. Spotlight Stock Picks. Host Chris Waltzek & Bob Chapman, The International Forecaster discussion and answer listener's questions. GUEST BIOS: Gary Cope, Orex Minerals Inc. Richard Daughty, The Mogambo Guru Report
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| International Forecaster October 2011 (#9) - Gold, Silver, Economy + More Posted: 30 Oct 2011 03:15 AM PDT It is now clear to the most casual observer that the world's monetary and financial system cannot function without massive amounts of additional money and credit. That means the system no longer functions the way it should. Europe really doesn't know what to do and neither does the Fed and the Bank of England. The exception is throwing more money at the problem and keeping interest rates near zero indefinitely.
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| Exotic Congo Holds Hidden Values Posted: 30 Oct 2011 02:00 AM PDT Investments in the Democratic Republic of the Congo often get dinged with an "exotic locale" discount, but the jurisdiction is much less risky than even a few years ago. Kevin Puil, a portfolio manager with Malcolm H. Gissen & Associates and senior analyst with the Encompass Fund, recently traveled to the Congo and he liked what he saw. In this exclusive interview with The Gold Report, Puil shares his insight about this emerging mining jurisdiction.
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| THE UNFORTUNATE TRUTH ABOUT AN OVERBOUGHT STOCK MARKET Posted: 29 Oct 2011 06:03 PM PDT Here's JW Jones's perspective on the stock market and the eurozone "non-bailout" or whatever it is, from www.OptionsTradingSignals.com. ~ Ilene THE UNFORTUNATE TRUTH ABOUT AN OVERBOUGHT STOCK MARKETWriting about financial markets is probably the most challenging endeavor I have ever immersed myself into. I am a trader first and a writer second, but I have really come to enjoy scribing missives about financial markets because it really forces me to concentrate on my analysis. Writing for the general public has really enhanced my perception of the market and forced me to dig deeper and learn new forms of analysis. I find myself learning more and more every day and the beauty of trading is that even for the most experienced of traders there is always an opportunity to learn more. As members of my service know, I strive to be different than most of my peers as my focus is on education and being completely transparent and honest. I want readers to know that I was wrong about my recent expectations regarding the European sovereign debt summit. I was expecting the Dollar to rally based on the recent price action and quite frankly I expected stocks to falter after running up nearly 15% into the announcement. My expectations could not have been more untimely and incorrect. I share this with you because as I read and listen to market pundits discussing financial markets I find that too many writers and commentators flip-flop their positions to always have the appearance of accuracy. In some cases, there have been television pundits that stated we were possibly going to revisit a depression in 2012 no more than 5 weeks ago. These so-called experts have now changed their positions stating that we have started a new bull market in recent weeks. How can anyone take these people seriously? Financial markets are dynamic and consistently fool the best minds and most experienced traders out there. Financial markets do not reward hubris. If a trader does not remain humble, Mr. Market will happily handle the humbling process for him. I was humbled this week. I was reminded yet again that financial markets do not take prisoners and they show no mercy. I am sharing this with readers because I want you to know that I refuse to flip-flop my position without first declaring that I was wrong. When I am wrong, I will own up to it purely out of sense of responsibility. My word and my name actually mean something to me, and while I strive to present accurate analysis I am fallible and I will make mistakes. The key however to the mistakes that I make is my ability to learn from them and the past week was a great learning opportunity. After regrouping and stepping back after the price action on Thursday, a few key elements really stood out to me regarding recent price action. First of all, in the short-term we are extremely overbought. The chart below illustrates the number of stocks in domestic equity markets trading above their 20 period moving averages over the past 5 years:  Overbought Stock Momentum What is apparent from the chart above is that prices are almost as overbought right now as they have been anytime in the past 5 years. The number of domestic equities trading above their 50 period moving average over the past 5 years is also nearing the highest levels seen during the same period as the chart below illustrates:  Trading Stock Market Momentum Equities trading above the 100, 150, and 200 period moving averages are somewhat subdued by comparison meaning in the short run a possible correction appears likely. The longer-term time frames are no longer oversold, but they have considerable upside to work with before we could declare that they are overbought. Additionally, the details of the European Union's supposed solution have not yet been released raising questions going forward. Every move that is made will create unintended consequences. As an example, since Greece had 50% of their debt written down why wouldn't Ireland or Portugal refuse to pay their debts in full? The Irish and Portuguese governments are going to come under pressure from their constituents to renegotiate the terms of their debt based on the agreement that was made with Greece recently. Spain politicians will likely be under pressure as well. The decisions made in these so-called bailouts reverberate across the geopolitical spectrum. Moral hazard still exists, it just evolves over time. The risk premium of sovereign debt has to be adjusted since credit default swaps did not trigger payment as the write-downs were considered "voluntary." Thus credit default swaps are not the answer to hedge sovereign debt as it would appear that governments have the ability to write down debt without triggering a default based on the status of the write-down. The long-term unintended consequences could be severe and are unknown at this point in time. In addition to the unknown factors impacting the European "solution", next week the Federal Reserve will have their regular FOMC meeting and statement. There has been a lot of chatter regarding the potential for QE III to come out of this meeting. While I could be wrong, initiating QE III right after the Operation Twist announcement would lead many to believe that Operation Twist was a failure. With interest rates at or near all time lows and the recent rally we have seen in the stock market, it does not make sense that QE III would be initiated during this meeting. It is possible that if QE III is not announced the U.S. Dollar could rally and put pressure on risk assets such as the S&P 500 in the short to intermediate term. If this sequence of events played out, a correction would be likely. The following is a daily chart of the S&P 500 with possible correction targets in place:  SPY Overbought Stock Market Right now it is a toss up in the financial blogosphere as to the expectations of where price action will head. Are we near a top? Is this the beginning of a new bull market? I scanned through several charts Friday evening and Saturday morning and came to this realization. If the market is going to breakout and this is not a top but the beginning of a major bullish wave higher, then the Nasdaq 100 Index (NDX) has to breakout over the 2011 highs. The Nasdaq 100 Index is comprised of stocks such as AAPL, GOOG, INTC, and YHOO. In order for a new leg higher to transpire, hyper beta names like AAPL and GOOG have to breakout higher and show continuation with strong supporting volume. If the NDX does not breakout over the 2011 highs, a top could potentially be forming. The daily chart of the Nasdaq 100 Index is shown below:  QQQ Overbought Market In conclusion, the short term looks like a possible correction could play out. However, it is critical to note that the longer term time frames are more neutral at this time. Furthermore, if price action cannot penetrate the 2011 highs for the Nasdaq 100 Index, I do not believe that a new bull market will have begun. If the Nasdaq 100 Index cannot breakout above the 2011 highs, we could be putting in a potential top going into the holiday season. In closing, I will leave you with the thoughtful muse of famed writer and minister Hugh Prather, "Almost any difficulty will move in the face of honesty. When I am honest I never feel stupid. And when I am honest I am automatically humble." By: JW Jones This material should not be considered investment advice. J.W. Jones is not a registered investment advisor. Under no circumstances should any content from this article or the OptionsTradingSignals.com website be used or interpreted as a recommendation to buy or sell any type of security or commodity contract. This material is not a solicitation for a trading approach to financial markets. Any investment decisions must in all cases be made by the reader or by his or her registered investment advisor. This information is for educational purposes only. Subscribers of OTS have pocketed more than 150% return in the past few months. If you'd like to stay ahead of the market using My Low Risk Option Strategies and Trades check out OTS and take advantage of our free occasional trade ideas or a 66% coupon to sign up for daily market analysis, videos and Option Trades each week. Check out Option Trading Signals here >
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| Beyond the Pale: What Last Year's (Alleged) Steven J. Baum Halloween Costumes Reveal Posted: 29 Oct 2011 04:13 PM PDT [Ed Note: These images are allegedly from LAST YEAR'S Steven J. Baum law firm party. THIS is exactly why people are joining the OCCUPY movement in droves. As America melts down in an orgy of greed and evil, more and more of us are getting fed up with the avarice that's at the heart of this type of sick, demented shit in corporate America.] By Joe Nocera
On Friday, the law firm of Steven J. Baum threw a Halloween party. The firm, which is located near Buffalo, is what is commonly referred to as a "foreclosure mill" firm, meaning it represents banks and mortgage servicers as they attempt to foreclose on homeowners and evict them from their homes. Steven J. Baum is, in fact, the largest such firm in New York; it represents virtually all the giant mortgage lenders, including Citigroup, JPMorgan Chase, Bank of America and Wells Fargo. The party is the firm's big annual bash. Employees wear Halloween costumes to the office, where they party until around noon, and then return to work, still in costume. I can't tell you how people dressed for this year's party, but I can tell you about last year's. That's because a former employee of Steven J. Baum recently sent me snapshots of last year's party. In an e-mail, she said that she wanted me to see them because they showed an appalling lack of compassion toward the homeowners — invariably poor and down on their luck — that the Baum firm had brought foreclosure proceedings against. When we spoke later, she added that the snapshots are an accurate representation of the firm's mind-set. "There is this really cavalier attitude," she said. "It doesn't matter that people are going to lose their homes." Nor does the firm try to help people get mortgage modifications; the pressure, always, is to foreclose…
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| Pento - Here is Why Gold & Silver Skyrocketed This Week Posted: 29 Oct 2011 04:01 PM PDT  With gold up $111 and silver trading over $4 higher this week, today Michael Pento, of Pento Portfolio Strategies, writes for KWN to explain why the metals surged and why they will continue to surge in the months ahead. Pento states, "Greece has supposedly received a bailout and markets across the globe are soaring. In fact, they are rising in the same manner they did a few months after the bailout of the U.S. financial system, which is now known as the Emergency Economic Stabilization act of 2008. However, the truth is there is no such thing as a complete and genuine bailout, there is only a transfer of burden from the government and banks to the middle class."
This posting includes an audio/video/photo media file: Download Now |
| Michael Pento: Here is Why Gold & Silver Skyrocketed This Week Posted: 29 Oct 2011 01:57 PM PDT from King World News:
Michael Pento continues: Read More @ KingWorldNews.com
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| Silver Guru Eric Sprott Talks Shop Concerning Silver Shortages Posted: 29 Oct 2011 12:33 PM PDT Occupy your Money, Buy physical silver Bullion. In this vid, Patrick MontesDeOca chats with Eric Sprott in this exclusive interview that took place at the Silver Summit in Spokane, Washington the week of October 17, 2011. Mr. Sprott speaks in riveting detail about the Silver Market and it's outlook through this year and next, in this not-to-be-missed interview.
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| [TaM-1222] The Truth About Yesterday’s Asparagus Soup & a Little Bit of Schving Schving Posted: 29 Oct 2011 10:27 AM PDT We talk about JP Morgan silver price manipulation, OccupyCoke.com, inflation, STFU David Cameron remix, property ladder, constipated with your bad house, Billy Idol, yesterday’s asparagus soup and a little bit of schving schving. Listen to show here. For more download … Continue reading
This posting includes an audio/video/photo media file: Download Now |
| Why The Latest Eurozone Bail-Out is Destined to Fail Within Weeks Posted: 29 Oct 2011 09:19 AM PDT I want last week's European bail-out to work. My sincere hope is that collective and decisive action by the eurozone's large member states will stabilize global markets, at least for a while, so allowing the global economy to catch its breath. by Liam Halligan, Telegraph.co.uk:
As someone who works in financial services, I follow the markets – in the West, across Asia and the entire world – closer than most. Since the Bear Stearns collapse in March 2008, through the demise of Lehman Brothers and its ghastly aftermath, much of my professional life has been dominated by the angry flashing of those little lights on a Bloomberg screen. In recent years, the violent gyrations on financial markets have been deeply discomforting, causing angst among market professionals, like me – but that is the least significant aspect. For those little lights represent, of course, the ebbs and flows of cash which, in turn, determines the fate of real businesses. It is at the sharp end of employment and livelihoods, dispossessed homes and broken families that the human impact of financial turbulence is most keenly felt.
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| How Much Gold Stock is There Really? Posted: 29 Oct 2011 09:12 AM PDT [Ed. Note: Chris Powell (GATA) had some remarks on this piece.] by Philip Barton, GoldStandardInstitute.net: The current estimate for the amount of gold stock in the world is in the region of 170,000 tonnes. As the very first step, it needs to be acknowledged that an estimate is all that is available. Running a worldwide survey on how much gold people own is rather pointless. Even in good times, people are noticeably reluctant to discuss their true wealth. In troubled times, such as now, that becomes an unwillingness to even be interviewed. Nevertheless, it also needs to be emphatically stated that 170,000 tonnes is far too low an estimate and that it is time for a revision. Every single media outlet repeats this same figure, or similar, as though it is gospel. Included in this 170,000 tonnes is the 10,000 tonnes estimated as being the total amount of gold mined in the history of the world prior to the Californian gold rush of 1848. This was simply a guess. Read More @ GoldStandardInstitute.net
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| 'Tis The Season For Seasonal Obfuscation Posted: 29 Oct 2011 08:58 AM PDT Submitted by Jeff Snider of Atlantic Capital Management 'Tis The Season For Seasonal Obfuscation The headline GDP number was apparently enough growth to completely erase all thoughts of any renewed recession. However, most of us know that one quarter is not a trend and that the quarterly numbers are often statistically adjusted beyond something non-statistically meaningful. If we look at the headline numbers in sequence, it certainly seems that the economy is picking up from the weak first half (not a full hockey stick, but close enough for economist types): Seasonally Adjusted Real GDP at annual rates Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 From these numbers it looks as if the economy slowed in the middle of 2010, hit a bottom in the first quarter of 2011, and has rebounded through the rest of 2011. I have little doubt that the economics profession has assumed a lagged effect from monetary stimulation, meaning the data largely confirms QE's stated goals. From this interpretation, it looks as if Bernanke and his crew were exactly right to begin just when conditions were deteriorating and we are now set to bask in the successful afterglow of monetary intervention. A funny thing happens, though, when you remove the seasonal adjustments. Rather than depend on the BEA's statistical "improvements" to the data series, you can simply compare the data year-over-year (bypassing the seasonal adjustments): Real GDP, y/y change at annual rates Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 This data presents an entirely different picture of the economy. From this point of view, GDP growth peaked toward the end of 2010 (just when QE 2.0 was announced) and has been decelerating ever since. This actually makes more sense given the next data series: Price Index, Gross Domestic Purchases, y/y change at annual rates Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 The economy's deceleration matches perfectly the increase in the price index, the BEA's uneven proxy for inflation. Intuitively this makes far more sense, and from that we can draw far different conclusions about the efficacy of monetary interventions. Of course, all caveats apply here, namely that none of these numbers are without difficulties and exhibit far too many assumptions to be considered very accurate descriptions of what is happening. The point of using them here without further questioning their validity is that even based on these faulty and reconfigured numbers the economy appears to be heading in the wrong direction for the exact reason that many of us have believed from the start. Even using the establishment's own numbers, we see the same picture that we have received from other sources. The only backward correction we have to make is to discard the seasonal adjustment, something that seems to be confusing a lot of economic series data lately. Of course, it stands to reason that if we take the view that the deflators the BEA use statistically, imputationally or otherwise undercount the severity of price changes, then the economy is in even worse shape right now (which is very likely). But, again, the quarterly snapshot is not really what is important here, it is the undeniable downward trend in GDP, due to the undeniably upward trend of inflation (even going by the most conservative and doctored estimates of it). If inflation is going to become "transitory", it had better transit to another state relatively soon. Within the internals of GDP, we see that five categories of activity account for 84% of all growth in the third quarter: personal service spending on housing and utilities, personal service spending on health care, plus non-residential investment in industrial equipment, transportation equipment and "other" equipment. Those business investments in various equipment together made up 45% of Q3 2011 GDP growth. Business equipment spending has been one of the few sources of "strength" in this recovery, simply because the scale of the decline during the Great Recession was massive. In other words, these are likely investments that were put off or delayed by the financial and liquidity conditions of the 2008/09 time period, and therefore are not necessarily investments undertaken due to expectations for future revenue growth. The fact that equipment spending exhibits the same decelerating trend as overall GDP means that inflation is not only taxing consumer spending, it is working its way into business investment and businesses' expectations about future needs: GPDI in Equipment and Software, y/y change at annual rates The other drivers of growth, the primary force behind the higher than expected PCE number, spending on personal services bring up all sorts of additional questions. The fact that spending on health care alone accounted for 0.61% of the overall 2.5% GDP growth is far more questionable than commendable. Housing and utility spending are also not the kinds of expenditures that lead to a robust and self-sustaining recovery. What we won't know until the second revision is how much of this estimated increase in housing spending was for utilities, how much was for rent, and how much was due to the BEA's imputation of owner's equivalent rent. If it was rent, that is problematic as it would suggest that the "benefits" of strategic default/squatting might be winding down. If it was the owner's equivalent rent line, then it is simply fiction (the BEA estimates what a homeowner would pay to himself if he rented the house he lives in from himself, as if this is real economic activity to be included – and this is not a small imputation either, totaling about $1.2 trillion of GDP – so any increase in this line is, by definition, fantasy). The 1.7% drop in real disposable income, and the subsequent drop in the savings rate, means that the downward trend in overall activity may be about to accelerate (third derivative changes outrank second derivatives). Rather than cheering this economic report, the market should be questioning its call for more inflation engineering (I suppose intentional dollar devaluations that drive overseas profitability at the expense of the domestic economy is a rational investment thesis on some level). Mainstream economists really believe in the Paradox of Thrift; that what is best for individuals (repairing their own balance sheet) is not the best course for the overall economy (because balance sheet reparation necessarily means less activity). Monetary policy has intentionally created inflationary expectations to get households out of their "bunker mentality", making the cost of holding money or saving expensive or unattractive. This includes a dangerous comfort level with rising oil and energy prices (see Federal Reserve Board's Research Paper "Oil Shocks and the Zero Bound on Nominal Interest Rates" published in September 2010). Coupled with the "wealth effect" and ZIRP, the Fed actually believes it can create "rational expectations" of a robust future, thereby essentially fooling households and consumers into undertaking activity that is not in their own best interests. This is what passes for a recovery plan today. That this convoluted scheme is actually expected by policymakers to work is beyond distressing. That we have to strip away the mathematical manipulation of the headline data to see this at work is unsurprising. This drop in the personal savings rate is actually welcomed by mainstream economists as a positive sign that monetary policy might be working, but the world is not an academic model. One has to wonder just how bad all these figures would be if they actually used Brent or Louisiana Light Sweet prices instead of WTI, but, unfortunately, such arcane observations of the unadjusted real world are beyond the capabilities of modern economic and monetary science. The real recovery begins when sanity and logic are implemented or injected into monetary policy. The Paradox of Thrift, the Wealth Effect, and Rational Expectations should all end up on the ash heap of history. Removing ZIRP alone might be enough to actually begin a real recovery. Until then, however, they can change the seasonal adjustments all they want, but the story remains the same.
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| 'Tis The Season For Seasonal Obfuscation Posted: 29 Oct 2011 08:58 AM PDT
Submitted by Jeff Snider of Atlantic Capital Management 'Tis The Season For Seasonal Obfuscation The headline GDP number was apparently enough growth to completely erase all thoughts of any renewed recession. However, most of us know that one quarter is not a trend and that the quarterly numbers are often statistically adjusted beyond something non-statistically meaningful. If we look at the headline numbers in sequence, it certainly seems that the economy is picking up from the weak first half (not a full hockey stick, but close enough for economist types): Seasonally Adjusted Real GDP at annual rates Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 From these numbers it looks as if the economy slowed in the middle of 2010, hit a bottom in the first quarter of 2011, and has rebounded through the rest of 2011. I have little doubt that the economics profession has assumed a lagged effect from monetary stimulation, meaning the data largely confirms QE's stated goals. From this interpretation, it looks as if Bernanke and his crew were exactly right to begin just when conditions were deteriorating and we are now set to bask in the successful afterglow of monetary intervention. A funny thing happens, though, when you remove the seasonal adjustments. Rather than depend on the BEA's statistical "improvements" to the data series, you can simply compare the data year-over-year (bypassing the seasonal adjustments): Real GDP, y/y change at annual rates Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 This data presents an entirely different picture of the economy. From this point of view, GDP growth peaked toward the end of 2010 (just when QE 2.0 was announced) and has been decelerating ever since. This actually makes more sense given the next data series: Price Index, Gross Domestic Purchases, y/y change at annual rates Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 The economy's deceleration matches perfectly the increase in the price index, the BEA's uneven proxy for inflation. Intuitively this makes far more sense, and from that we can draw far different conclusions about the efficacy of monetary interventions. Of course, all caveats apply here, namely that none of these numbers are without difficulties and exhibit far too many assumptions to be considered very accurate descriptions of what is happening. The point of using them here without further questioning their validity is that even based on these faulty and reconfigured numbers the economy appears to be heading in the wrong direction for the exact reason that many of us have believed from the start. Even using the establishment's own numbers, we see the same picture that we have received from other sources. The only backward correction we have to make is to discard the seasonal adjustment, something that seems to be confusing a lot of economic series data lately. Of course, it stands to reason that if we take the view that the deflators the BEA use statistically, imputationally or otherwise undercount the severity of price changes, then the economy is in even worse shape right now (which is very likely). But, again, the quarterly snapshot is not really what is important here, it is the undeniable downward trend in GDP, due to the undeniably upward trend of inflation (even going by the most conservative and doctored estimates of it). If inflation is going to become "transitory", it had better transit to another state relatively soon. Within the internals of GDP, we see that five categories of activity account for 84% of all growth in the third quarter: personal service spending on housing and utilities, personal service spending on health care, plus non-residential investment in industrial equipment, transportation equipment and "other" equipment. Those business investments in various equipment together made up 45% of Q3 2011 GDP growth. Business equipment spending has been one of the few sources of "strength" in this recovery, simply because the scale of the decline during the Great Recession was massive. In other words, these are likely investments that were put off or delayed by the financial and liquidity conditions of the 2008/09 time period, and therefore are not necessarily investments undertaken due to expectations for future revenue growth. The fact that equipment spending exhibits the same decelerating trend as overall GDP means that inflation is not only taxing consumer spending, it is working its way into business investment and businesses' expectations about future needs: GPDI in Equipment and Software, y/y change at annual rates The other drivers of growth, the primary force behind the higher than expected PCE number, spending on personal services bring up all sorts of additional questions. The fact that spending on health care alone accounted for 0.61% of the overall 2.5% GDP growth is far more questionable than commendable. Housing and utility spending are also not the kinds of expenditures that lead to a robust and self-sustaining recovery. What we won't know until the second revision is how much of this estimated increase in housing spending was for utilities, how much was for rent, and how much was due to the BEA's imputation of owner's equivalent rent. If it was rent, that is problematic as it would suggest that the "benefits" of strategic default/squatting might be winding down. If it was the owner's equivalent rent line, then it is simply fiction (the BEA estimates what a homeowner would pay to himself if he rented the house he lives in from himself, as if this is real economic activity to be included – and this is not a small imputation either, totaling about $1.2 trillion of GDP – so any increase in this line is, by definition, fantasy). The 1.7% drop in real disposable income, and the subsequent drop in the savings rate, means that the downward trend in overall activity may be about to accelerate (third derivative changes outrank second derivatives). Rather than cheering this economic report, the market should be questioning its call for more inflation engineering (I suppose intentional dollar devaluations that drive overseas profitability at the expense of the domestic economy is a rational investment thesis on some level). Mainstream economists really believe in the Paradox of Thrift; that what is best for individuals (repairing their own balance sheet) is not the best course for the overall economy (because balance sheet reparation necessarily means less activity). Monetary policy has intentionally created inflationary expectations to get households out of their "bunker mentality", making the cost of holding money or saving expensive or unattractive. This includes a dangerous comfort level with rising oil and energy prices (see Federal Reserve Board's Research Paper "Oil Shocks and the Zero Bound on Nominal Interest Rates" published in September 2010). Coupled with the "wealth effect" and ZIRP, the Fed actually believes it can create "rational expectations" of a robust future, thereby essentially fooling households and consumers into undertaking activity that is not in their own best interests. This is what passes for a recovery plan today. That this convoluted scheme is actually expected by policymakers to work is beyond distressing. That we have to strip away the mathematical manipulation of the headline data to see this at work is unsurprising. This drop in the personal savings rate is actually welcomed by mainstream economists as a positive sign that monetary policy might be working, but the world is not an academic model. One has to wonder just how bad all these figures would be if they actually used Brent or Louisiana Light Sweet prices instead of WTI, but, unfortunately, such arcane observations of the unadjusted real world are beyond the capabilities of modern economic and monetary science. The real recovery begins when sanity and logic are implemented or injected into monetary policy. The Paradox of Thrift, the Wealth Effect, and Rational Expectations should all end up on the ash heap of history. Removing ZIRP alone might be enough to actually begin a real recovery. Until then, however, they can change the seasonal adjustments all they want, but the story remains the same.
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| ?Gold is Useless!? and 6 Other Reasons To Hate Gold As An Investment Posted: 29 Oct 2011 08:16 AM PDT Over the past few years, pretty much every investor has become familiar with gold. The shiny precious metal has surged in price and has managed to hold strong while broad indexes have slipped, highlighting its appeal as a diversification agent and safe haven investment. This has prompted many investors to ramp up their allocations to the space in order to take advantage of these favorable trends and lead their portfolios to broad gains…[but] *there are a number of other issues that investors need to be aware of when considering allocating capital to the space, as there are several reasons to avoid the precious metal from an investment perspective. Below, we highlight seven reasons for why investors may want to temper their expectations for the metal and consider a more diversified approach that doesn't include such a large allocation to the 'barbaric relic'. Words: 2030 So says Eric Dutram ([url]http://commodityhq.com[/url])**in edited excerpts from an article* which Lorimer ...
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| Posted: 29 Oct 2011 07:29 AM PDT
By Dominic Sandbrook of Mail Online Europe at war 2018 German troops storm Greece. Putin's tanks crush Latvia. France humbles the British Army. Unlikely, yes, but as Angela Merkel says euro meltdown could endanger peace, a historian's imagination runs riot... The date is October 29, 2018, and Britain faces its darkest hour. On the battlefields of Europe, our Armed Forces have been humiliated. In makeshift prison camps on the continent, thousands of our young men and women sit forlornly, testament to the collapse of our ambitions. From the killing grounds of Belgium to the scarred streets of Athens, a continent continues to bleed. And, in the east, the Russian bear inexorably tightens its grip, an old empire rising from the wreckage of the European dream. Yesterday, after a run of military defeats unequalled in our history, the Prime Minister offered his resignation. There is talk of a National Government, but no one has any illusions of another Churchill waiting in the wings. In suburban streets across Britain, old men and callow teenagers are digging defensive positions in the cold autumn air. But with equipment scarce and ammunition non-existent, the Home Guard would barely last a week. And all the time, across the Channel, enemy forces make their final preparations for the inevitable invasion. Some talk of surrender; no one speaks of victory. Less than ten years ago, millions still believed in a peaceful, united Europe. How did it come to this? When future historians look back on our humiliation, they will surely judge that the turning point was the last week in October 2011. Largely forgotten today, the main event was yet another interminable European summit in Brussels — the 14th attempt to 'save the euro' in just 20 months. Hoping to secure German support for a massive one trillion euro rescue package, Chancellor Angela Merkel gave her parliamentarians a chillingly prescient warning. 'No one should believe that another half century of peace in Europe is a given — it's not,' she said. 'So I say again: if the euro collapses, Europe collapses. That can't happen.' At the time, many observers scoffed that she was being absurdly melodramatic. But, seven years on, no one is laughing. What Mrs Merkel had grasped — and what many European leaders refused to recognise — was that the Continent was threatened by a toxic combination of spiralling debt, economic recession, surging anarchism and a pervasive collapse of confidence in capitalism itself. .... In the summer of 2012, massive anti-capitalist demonstrations in major Italian cities turned into outright rebellion. And when Berlusconi sent in the army to maintain order, the first bombs began exploding in the banks of Rome, Milan and Turin. Anti-capitalism had caught the imagination of a generation. And the bomb alert at the Bank of England —when the entire City had to be evacuated after warnings from the so-called 'Guy Fawkes Anti-Cuts Collective' — was merely the first of many. In July 2012, three people were killed by a bank bomb in Frankfurt. A month later, 15 people were killed in Dublin. And in September, in tragic events that will never be forgotten, 36 people were killed by explosions across the City of London. By now demonstrations and riots were fixtures on the evening news. And as Germany and France struggled to keep the eurozone alive, there were the first signs of a disturbing new authoritarianism. In Italy, where the Berlusconi government had declared a permanent state of emergency, some cities had degenerated into virtual civil war. ... At another time, the terrible Spanish riots in the spring of 2014, when 63 people were killed in a shocking outbreak of arson and looting, would have dominated the headlines. But most people's attention was focused further east. No country had been hit harder by the financial crisis than little Latvia, which by 2014 had an unemployment rate of more than 35 per cent. And with almost one in three of its citizens being ethnic Russians, economic frustration soon turned into nationalist confrontation. On August 12, 2015, after days of fighting on the streets of Riga, the Russian army rumbled across the border. The Russians had come to 'restore order', Vladimir Putin assured the world. But his statement to the Russian people told a different story. 'Europe's crisis is Russia's opportunity,' Putin announced. 'The days of humiliation are over; our empire will be restored.' Once, the West would have come to Latvia's aid. It was, after all, a member of both the European Union and of Nato — though the new American isolationism meant that Nato membership was effectively worthless. But since French troops were already committed to Greece and Italy, Paris refused to intervene.
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| Philip Barton: How much gold stock is there really? Posted: 29 Oct 2011 06:49 AM PDT 1:44p CT Saturday, October 29, 2011 Dear Friend of GATA and Gold: In fascinating commentary published this week, Gold Standard Institute President Philip Barton compiles evidence that the world's gold stock may be 10 times or more the generally accepted estimate of 170,000 tonnes. Of course GATA long ago established that officially reported Western central bank gold reserves likely exaggerate greatly the metal the central banks actually have in their vaults, insofar as most refuse to differentiate between gold on hand and gold that has been leased or swapped out. GATA also has established that at least the central banks of China and Saudi Arabia lately have held far more gold than they have reported officially. Barton's commentary addresses both official-sector and privately held gold, including the immense amount of gold said to have been looted from Asia by Japan during World War II, stored in the occupied Philippines under Gen. Tomoyuki Yamashita, and eventually recovered by the United States. Given the secrecy imposed on gold by both its government and private holders, hardly any assertion about the metal's possession can be proven to be impossible. But it seems unlikely that Western central banks generally and the U.S. government particularly had access to any fantastic hoard of gold at least as of March 1968, when enormous offtake forced the urgent and awkward closing of the London Gold Pool, the mechanism by which the United States and its Western European allies held the gold price to $35 per ounce. Given all the documentation from that era of the desire of the U.S. government and its allies to keep the gold price down to support the U.S. dollar, the United States could have kept the London Gold Pool going a lot longer if it had access to "Yamashita's gold." But whatever the truth of the supposed Yamashita hoard, Barton rightly disputes those who claim that there isn't enough gold in the world to underwrite a return to a gold standard in currencies, "a common refrain from those whose self-interest it serves." A huge amount of gold would not be needed to support a modern gold standard, just a huge gold price. Barton's commentary is headlined "How Much Gold Stock Is There Really?" and you can find it at the Gold Standard Institute's Internet site here: http://www.goldstandardinstitute.net/2011/10/how-much-gold-stock-is-ther... CHRIS POWELL, Secretary/Treasurer ADVERTISEMENT The United States Once Again Can Establish a Stable Dollar Worth Its Weight in Gold Lewis E. Lehrman, chairman of the Lehrman Institute, sponsor of The Gold Standard Now project, has released a plan to restore economic growth through a stable dollar. The plan, titled "The True Gold Standard: A Monetary Reform Plan Without Official Reserve Currencies," responds to the recurrent economic crises of the last century and outlines a detailed proposal for America's leadership on "how we get from here to there." That is, how we get from the present unstable paper dollar to a stable dollar as good as gold. James Grant, author and editor of Grant's Interest Rate Observer, says of the Lehrman plan: "If you have ever wondered how the world can get from here to there -- from the chaos of depreciating paper to a convertible currency worthy of our children and our grandchildren -- wonder no more. The answer, brilliantly expounded, is between these covers. America has long needed a modern Alexander Hamilton. In Lewis E. Lehrman the country has finally found him." To learn more and to sign up for The Gold Standard Now's free, noncommercial, weekly report, "Prosperity through Gold," please visit: http://www.thegoldstandardnow.org/gata 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 Be Part of a Chance to Discover Multi-Million-Ounce Gold and Silver Deposits in Canada Northaven Resources Corp. (TSX-V:NTV) is advancing five gold and silver projects in highly prospective and politically stable British Columbia, Canada. Check out the exploration program on our Allco gold/silver project : -- A large (13,000 hectare) property, covering more than 15 square kilometers of a regional mineralized trend just 3km from a recently announced 1.2-million-ounce gold and 15-million-ounce silver deposit. -- The property hosts historic high-grade silver workings and many mineral showings as well as former mines at the property's northern and southern boundaries. -- A deep-penetrating airborne geophysics survey has just been completed on the entire property and neighboring deposits and its results are eagerly awaited. To learn more about the Allco property or Northaven's other gold and silver projects, please visit: http://www.northavenresources.com Or call Northaven CEO Allen Leschert at 604-696-3600.
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| Haynes, Norcini enthusiastic about immediate prospects for gold and silver Posted: 29 Oct 2011 05:25 AM PDT 12:22p ET Saturday, October 29, 2011 Dear Friend of GATA and Gold (and Silver): In the weekly precious metals review at King World News, CMI Gold and Silver's Bill Haynes and futures market analyst Dan Norcini sound enthusiastic about the immediate prospects for the precious metals as well as the long-term prospects. You can listen to their comments at King World News here: http://kingworldnews.com/kingworldnews/Broadcast/Entries/2011/10/29_KWN_... 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_... 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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| By the Numbers for the Week Ending October 28 Posted: 29 Oct 2011 04:25 AM PDT NEW ORLEANS -- Just below is this week's closing table, followed by the CFTC disaggregated commitments of traders (DCOT) recap table for the week ending October 28, 2011.
Vultures, (Got Gold Report Subscribers) please note that updates to our linked technical charts, including our comments about the COT reports and the week's technical changes, should be completed sometime on Monday, October 31. In the DCOT table below a net short position shows as a negative figure in red. A net long position shows in black. In the Change column, a negative number indicates either an increase to an existing net short position or a reduction of a net long position. A black figure in the Change column indicates an increase to an existing long position or a reduction of an existing net short position. The way to think of it is that black figures in the Change column are traders getting "longer" and red figures are traders getting less long or shorter. All of the trader's positions are calculated net of spreading contracts as of the Tuesday disaggregated COT report.
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| Why Sound Money is a Basic Human Right: Alasdair Macleod Posted: 29 Oct 2011 02:03 AM PDT ¤ Yesterday in Gold and Silver It was a very quiet trading day in the gold world yesterday. The price traded within ten dollars of its Thursday close. The gold price finished down $2.30 on the day...closing at $1,743.40 spot. Net volume reflected the price action, as only 99,000 contracts or so contracts changed hands. The silver price action was a little more exciting...but only just. The price made at least three attempts to break through the $35.50 price level, but got sold off every time. The price closed at $35.29 spot, which was up 20 cents on the day. Net volume was around 31,000 contracts. Despite the subdued price action in gold, plus the flat close to the U.S. equity markets, the gold stocks spent virtually the entire day in positive territory...with the HUI finishing very close to its high of the day...up 2.55%. For the week, the gold price was up $101...and the HUI jumped 12.6%...which takes it back into slightly positive territory for the yea...
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| Posted: 29 Oct 2011 01:51 AM PDT Synopsis: Welcome to the weekend edition of Casey Daily Dispatch, a compilation of our favorite stories from the week for the time-stressed readers. Dear Reader, Welcome to the weekend edition of Casey Daily Dispatch, a compilation of our favorite stories from the week for the time-stressed readers. Of course, if you want to read all of the Daily Dispatches from the week, you may do so in the archives at CaseyResearch.com.
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| Saving The Eurozone, Will it Work? Posted: 28 Oct 2011 08:01 PM PDT It is now clear to the most casual observer that the world’s monetary and financial system cannot function without massive amounts of additional money and credit. That means the system no longer functions the way it should. Europe really doesn’t know what to do and neither does the Fed and the Bank of England. The exception is throwing more money at the problem and keeping interest rates near zero indefinitely. Many US, UK and European banks are insolvent. The real estate market continues to deflate throughout Europe with the exception of Germany, which never really rose in price. Again, there are no solutions offered to solve this problem. Just as there are no solutions elsewhere. These conditions tell us the euro has serious problems to face as does the pound and the US dollar. You have to then say to yourself against what. Each currency has its own problems, thus, the only alterative is to measure each currency versus gold and silver. These are the true benchmarks, and when compared over the last 11-1/2 years, versus nine major currencies gold and silver on average annually have appreciated more than 20%. That tells you anyone holding currencies has been a major loser.
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| Posted: 28 Oct 2011 07:27 PM PDT Imagine if the local fire chief, in the spirit of conservation, decided he’d use no more than 1,000 gallons of water to put out any given house fire. Do you think the citizens would support that policy if their town was burned to the ground? And, yet, this is the same approach that eurozone leaders are using to address the debt crisis. The central bank (ECB) has virtually limitless resources (Think: printing press) to defend the debt of the individual states and to act as lender of last resort, but the eurocrats won’t hear of it. They refuse to use the ECB as every other central bank in the world is used. They’d rather reinvent the wheel by creating a funky, improvised emergency fund (European Financial Stabilization Facility or EFSF) that’s massively leveraged and which only provides a 20 percent “first-loss” guarantee on sovereign bonds. So, for example, if Italy goes belly-up in the next year or so and can’t repay its debts, then Mr. bondholder gets a whopping 20 cents on the dollar. Such a deal!
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| How Will Gold and Silver React to the EU Bailout Plan? Posted: 28 Oct 2011 07:12 PM PDT After numerous jukes and headline rumors, the world finally received a so-called EU solution. After threatening with a total insolvency Greece situation, European leaders were able to talk bondholders into accepting a 50% haircut on Greek debt. Furthermore, the euro zone leaders agreed to increase the firepower of the European Financial Stability Facility. The markets reacted quite well to the news, even if it was just a knee-jerk reaction. The Dow surged 340 points, and is now on track for its biggest monthly percentage gain in nearly 25 years.
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| Guest Post: Eric Janszen: We Are Witnessing The Death Of The Dollar Posted: 28 Oct 2011 01:11 PM PDT
Submitted by Adam Taggart of Chris Martenson.com Eric Janszen: We Are Witnessing The Death Of The Dollar What do you get when the producer of the world's reserve currency takes on too much debt? Nothing less than the end of the US Treasury-based monetary system. So says Eric Jansen, economic and financial market analyst and proprietor of iTulip.com. In chronicling the decline of the global economy over the past decade, Eric has formulated a framework called the "Ka-POOM" theory, which endeavors to understand how the immense run-up in global debt will be resolved. In short, it looks at the at the credit bubble that began in the early 1980's, started accelerating in 1995, and has now reached epic proportions. The amounts are so staggering at this stage that Eric believes it is too politically undesirable to let natural market adjustments clear them away - the magnitude of the deflationary pain this would create is simply unacceptable for politicians looking to get re-elected. The only other available option left is to service these debts via a dramatically devalued currency. Hence the key role the Fed is playing today. The Fed is at the epicenter of this process, intervening heavily to keep the natural corrective market forces at bay. In this, it has a dual strategy. The first is to keep asset prices high (i.e., fight asset deflation), which it is doing by keeping interest rates historically low. The second is to keep wage and commodity costs under control, which it primarily does via devaluing the currency (maintaining a "weak dollar"). And, of course, through its intervention, the Fed is doing all it can to keep the current financial system in place to perpetuate the process for as long as possible. The end result is a fundamental shift in risk from Wall Street to the taxpayer. So the big question is: how long can this last? Is there a point at which confidence in the system breaks and market forces finally overwhelm the intervention? Eric's answers: "Much longer than most people expect." And "Yes." First off, as the most important central bank in the world, the Fed has supernormal powers. In theory, it can expand its balance sheet infinitely. It's ability to absorb massive amounts of new liabilities is theoretically limitless - much of which can be easily concealed from an accounting standpoint. And since the US is both the world's largest economy as well as the provider of its reserve currency, other countries are compelled to support the current regime. A mortal crack-up in the US economy would deliver undue pain to all its trading partners, so they continue to buy Treasuries in sufficient amount to fund US economic activity. But that's not to say they're happy about it. And here's where attention should be paid (and where the importance of gold comes in). For much of the past century, the United States comprised approximately 54-58% of the global economy. Today, it's share has shrunk down to about 18%. Meaning: it's relative importance to the global system has diminished. Issuing the world's reserve currency is a privilege that must be continually earned through transparency and sound stewardship - qualities the US has been in flagrant lack of in the past several decades as it has been blowing asset bubbles and running trillion-dollar deficits via incurring massive debts and increasing its money supply tremendously. So, even as they continue to support the current Treasury-backed monetary regime, the world's central banks have begun hedging their exposure. After several decades of being net sellers, the world's central banks became net buyers of gold in the second quarter of 2009. As Eric puts it:
Eric sees this move by central banks of positioning themselves closer to the door as a natural step to the inevitable endgame here, which is the dissolution of the US Treasury dollar-based monetary system. Due to entrenched special interests, politics, escalating commodity scarcity, and other factors - he does not see the US taking necessary corrective action before confidence in the solvency of the US and its currency collapses. As such, Eric advises investors position themselves into gold and assets that take advantage of rising rents and energy prices. Click the play button below to listen to Chris' interview with Eric Janszen (runtime 43m:46s):
iTunes: Play/Download/Subscribe to the Podcast Or click here to read the full transcript.
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| Be Honest – The European Debt Deal Was Really A Greek Debt Default Posted: 28 Oct 2011 11:45 AM PDT
Courtesy of Michael Snyder of Economic Collapse
The big message that Europe is sending to investors is that when individual nations get into debt trouble they will be allowed to default and investors will be forced to take huge haircuts. As this reality starts to dawn on investors, they are going to start demanding much higher returns on European bonds. In fact, we are already starting to see this happen. The yield on two year Spanish bonds increased by more than 6 percent today. The yield on two year Italian bonds increased by more than 7 percent today. So what are nations such as Italy, Spain, Portugal and Ireland going to do when it costs them much more to borrow money? The finances of those nations could go from bad to worse very, very quickly. When that happens, who will be the next to come asking for a haircut? After all, if Greece was able to get a 50% haircut out of private investors, then why shouldn't Italy or Spain or Portugal ask for one as well? According to Reuters, German Chancellor Angela Merkel is already trying to warn other members of the EU not to ask for a haircut....
But investors are not stupid. Greece was allowed to default. If Italy or Spain or Portugal gets into serious trouble it is likely that they will be allowed to default too. Investors like to feel safe. They want to feel as though their investments are secure. This Greek debt deal is a huge red flag which signals to global financial markets that there is no longer safety in European bonds. So what is coming next? Hold on to your seatbelts, because things are about to get interesting. Around the globe, a lot of analysts are realizing that this European debt deal was not good news at all. The following is a sampling of comments from prominent voices in the financial community.... *Economist Sony Kapoor: "The fact that a deal has been agreed, any deal, impresses people. Until they start de-constructing it and parts start unravelling." *Economist Ken Rogoff: "It feels at its root to me like more of the same, where they've figured how to buy a couple of months" *Neil MacKinnon of VTB Capital: "The best we can say is that the EU have engineered a temporary reprieve" *Graham Summers of Phoenix Capital Research:
*Max Keiser: "There will be another bailout required within six months - I guarantee it." The people that are really getting messed over by this deal are the private investors in Greek debt. Not only are they being forced to take a brutal 50% haircut, they are also being told that their credit default swaps are not going to pay out since this is a "voluntary" haircut. This is completely and totally ridiculous as an article posted on Finance Addict pointed out...
European politicians may believe that they have "solved" something, but the truth is that what they have really done is they have pulled the rug out from under the European financial system. Faith in European debt is going to rapidly disappear and the euro is likely to fall like a rock in the months ahead. The financial crisis in Europe is just getting started. 2012 looks like it is going to be an extremely painful year. Let us hope for the best, but let us also prepare for the worst.
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| Posted: 28 Oct 2011 10:27 AM PDT Federal judge will sentence a man who say took advantage of the booming gold market, by scamming people out of ten's of millions of dollars.
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As someone who works in financial services, I follow the markets – in the West, across Asia and the entire world – closer than most. Since the Bear Stearns collapse in March 2008, through the demise of Lehman Brothers and its ghastly aftermath, much of my professional life has been dominated by the angry flashing of those little lights on a Bloomberg screen.
With gold up $111 and silver trading over $4 higher this week, today Michael Pento, of Pento Portfolio Strategies, writes for KWN to explain why the metals surged and why they will continue to surge in the months ahead. Pento states, "Greece has supposedly received a bailout and markets across the globe are soaring. In fact, they are rising in the same manner they did a few months after the bailout of the U.S. financial system, which is now known as the Emergency Economic Stabilization act of 2008. However, the truth is there is no such thing as a complete and genuine bailout, there is only a transfer of burden from the government and banks to the middle class."
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