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Thursday, May 24, 2012

Gold World News Flash

Gold World News Flash

Toxic Euro Corroding Gold

Posted: 23 May 2012 06:58 PM PDT

WHAT'S UP with the gold price? Not a lot. Gold is down, in fact. So is everything else outside the US Dollar and "safe" sovereign debt. "I think what we can expect is a rate cut from the ECB [European Central Bank]," reckons Joachim Fels, chief economist at Morgan Stanley, speaking to Bloomberg on Wednesday.


Will 'Peak Gold' Exploration Continue to Grow?

Posted: 23 May 2012 06:53 PM PDT

Global gold production is at an all-time high, according to a new report from the U.S. Geological Survey. In this exclusive interview with The Gold Report, the Survey's Mineral Commodities Specialist Micheal George pinpoints where the gold is coming from and what trends can be expected in the coming years.


Demand for Gold Rises but Analysts See Another Leg Lower

Posted: 23 May 2012 05:47 PM PDT

Bullion Vault


Beware Of Proud Greeks And Ultimatums

Posted: 23 May 2012 05:22 PM PDT

The ballot box and economics textbook are on a collision course around the world, and we thought Nic Colas' (of ConvergEx) analysis of what behavioral economists call The Ultimatum Game was worth a refresher.  That's where two strangers divide a fixed sum of money, with one person proposing a split and the other accepting or rejecting it.  It's a one-shot deal, so the proposer tries to work out the minimum amount required to get the other person to go along.  Classical economics says that a $1 proposal out of a $100 pot should work, but in real life (and this study has been done everywhere from the rainforests of South America to the bars of Pittsburgh) it takes 25-50% offers to win the day.  Nic found three recent updates to the Ultimatum Game that each speak directly to the current political state of play in Europe and the United States.  One shows that proud people (or those led by nationalist-minded politicians, perhaps) need higher offers in order to accept a split. The second shows that the Game works even for small amounts.  The last – and the first such study we've ever seen from a mainland Chinese university – shows that worries over social status complicate the already difficult mental calculus of "How much is enough?"

All the proposed solutions to the European and American debt crises seem to meet at the crossroads of what is "Fair."  A tough word, that, since it means different things to different people.  A trip to several online etymology resources – the Oxford English Dictionary website sits behind a paywall that would make Hadrian proud – delivered this composite description of the word's historical usage:

  • From the Old English – "Beautiful, lovely, pleasant."
  • From archaic Scandinavian languages – "Beautiful" or "fit"
  • From the Middle Ages – "Light complexioned" or "free from bias".  The latter is from another strain of the word, meaning "Moral, or pure, or free from blemish."
  • From the 1850s – the words starts to become incorporated into sports commentary, meaning "Proper."

In other words, "Fair" in medieval times is the linguistic equivalent of today's "smoking hot, but not too trampy."  How that meaning migrated to its current definition of "Equitable," "legitimate" or "honest" must be a long journey.  Too bad – it seems more civilized and sweeter to say that David Beckham or Kate Upton or (fill in your favorite celebrity name here) is "Fair."

And just as the word has evolved over the years, so has the view of economists on its role in human decision-making.  Classical economics had little use for the concept during its heyday in the middle part of the last century.  Hand a logical thinking human a $1, and that will always make them feel better off.  Why would it be otherwise?  The notion that the marginal dollar is always welcome at the city gates of consumer psychology is pervasive in modern economic theory.  It even makes an appearance in that credit card advert with Jimmy Fallon and the baby that is on every 15 seconds across America: "Who doesn't want more money?"

In the early 1980s, behavioral psychologists studying how humans bargain came upon an elegant experiment that proved classical economics had the marginal dollar construct very, very wrong (Kuth, Schmittberger, and Schwarze, 1982).  They asked pairs of people, strangers to each other, to split a pot of money.  The only catch was that it was a one-shot deal.  One person proposes a split, the other person accepts or rejects it.  Accept, and both parties keep the money as agreed.  Reject, and no one gets anything.  The marginal dollar construct of classical economics would have you believe that the person in charge of offering the split could put out $1 out of $100 and get the other person to agree.  Laughably wrong, of course.

The Ultimatum Game, as researchers now call this experiment, is the single most replicated and refined study in what is now called behavioral finance.  It has been done with illiterate Amazonian tribespeople, drunk students on pub crawls in Pittsburgh, and both men and women jacked up on testosterone.  The results are always the same: the person proposing the split needs to offer up at least 20%, and usually closer to 50%, to have a change of seeing their offer accepted.  It seems a genuine constant of human nature that people need to feel that they are being treated "Fairly."  Moreover, the price of this requirement is explicit, as they are willing to give up real money just to make sure the other person doesn't get more than they deserve.

I recently came across three updates to The Ultimatum Game that further expand on this central theory of perceived "Fairness":

  1. The money isn't actually the issue.  Amazon has an online portal called www.mturk.com that is a effectively a marketplace for short projects and the people that want to work on them.  Israeli researchers leveraged this platform to run a modified Ultimatum Game using only small amounts of money.  Instead of $20 or $100, which are the more common monetary pools used for similar studies, they ran the game with over 700 subjects using either no money at all or just $1.  The idea here was to test if the subjects would grow more "Rational" when only de minimus amounts were on the table.  The answer: an unequivocal "No." Even when small amounts were at stake, the "Fairness" issue still ruled the day in the same proportions as when "Real" money is on the line.  See here: http://www.plosone.org/article/info%3Adoi%2F10.1371%2Fjournal.pone.0031461.
  2. Self-worth explains part of the puzzle.  Do you know someone who always dates the "Wrong" people or lets others walk all over them?  Don't let them be a subject in The Ultimatum Game, because they are about the only ones for whom the $1 out of $100 looks like an acceptable split.  As it turns out, self-worth is a strong determining factor in how much someone accepts in the game.  See here:  http://www.plosone.org/article/info%3Adoi%2F10.1371%2Fjournal.pone.0015095.
  3. And notions of social status explain some more.  In the first Ultimatum Game study I have seen written up from mainland Chinese researchers, the form of the game is altered to give the person judging the offer a sense of what offers their peers in the study received.  If you tell a subject that their peers are seeing 35% offers, they are much less likely to accept a 30% proposed split.  See here: http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3213677/.

One way to look at the current tensions in both European and American debt discussions is as an Ultimatum Game between governments and individuals.  Take Greece, for example.  Classical economics would say – and you will hear a lot of policymakers echo – that the Greeks should take whatever deal they can.  Something is better than nothing.  All the lessons of the Ultimatum Game studies point to an entirely different conclusion.  The Greek feel that they have been treated unjustly. After all, the wealth created by the fraudulent government accounting really accrued to only a handful of people.  So whatever deal might be on the table is not "Fair" (that word again…).  And even if it means being materially worse off, Greeks may well choose that route.

And the new studies I highlight in this note seem to push that conclusion even more strongly.  The Greek people are nothing if not proud.  And they are also sensitive to the notion that the turmoil of the last three years has diminished their social standing in the European community.  Put those two factors together, and the upcoming vote on June 17th feels even more unsettled than one would think.  At the end of the day, the stresses of the ongoing financial crisis are not just about the money.   And since humans react the same everywhere around the globe when it comes to the Ultimatum Game, the lessons of that study are just as relevant in Athens, Georgia as Athens, Greece.   The upcoming U.S. presidential election will certainly prove that.  


Words to Remember…

Posted: 23 May 2012 05:01 PM PDT

[Ed. Note: On days like this, it's important to remember the words of those who are trying to help us see the big picture. In this case, the recent words of Jim Willie. Today, my pal B5 reminded me of this excerpt from Willies' latest:]

MY GOLD TRADER SOURCE IS PRIVY TO SOME GOLD TRANSACTIONS AS WITNESS. THE WALL STREET AND LONDON FIRMS PUSH THE GOLD PRICE DOWN WITH NAKED SHORT PAPER FUTURES CONTRACTS. THE EASTERN COALITION PUSHES IT DOWN FARTHER, IDENTIFIES THE ILLIQUID BIG BANKS WITH MARGIN CALLS, REFUSES CASH TO SATISFY, AND FORCES GOLD SALES AT DISCOUNT PRICES. THE VICTIMS ARE DRY OF CASH, HURTING MAINLY FROM EUROPEAN DEBT. THE CARTEL MEMBER BANKS ARE TARGETED IN A MODEL EXECUTION. THE PHENOMENON IS NEW. THE SLOW PROCESS IS EXPLAINED. HERE ARE SOME SKETCHY DETAILS.

The following note came in early May. The important part is that the transactions are conducted off-market. The reason can only be surmised as higher powers are at work, calling the shots, angry at the criminal banker roles, conducting redress, announcing a new Sheriff in town ready and willing to cause some pain in old-fashioned justice, with feet put to the fire. These are financial executions and kills from a repeated model. My suspicion is that the Eastern entities are large hidden creditors who have returned with vengeance in mind but justice in their hearts. He wrote, "There are much bigger things going on behind the curtain. This has very little to do with the usual suspects.

It is a small Eastern group that is taking very substantial quantities in off-market transactions from people under liquidity pressure. The cartel bank business is suffering, as credit market worsens, sovereign bonds are hurt, even FX bets are not working. Margin calls ring every day. The latest LTRO backfired in their faces, as most new positions with the fresh borrowed Draghi funds are underwater. The cartel targets are again vulnerable. It only takes 1.5 to 3.0 metric tonnes to drive the official market through the floorboards. At that point another big cartel bank is forced to part ways with its gold bullion at a price they truly hate, thus resisted, making for slow clearance of the standing orders. Since these big off-market transactions are done on a spot basis, these buyers depress the prices to get the price they want.

The process, new since last autumn, has continued with each round of paper ambushes conducted by the same banks that are being stripped of their gold. The sheeple have no clue what goes on and neither have the idiots in front of their trading screens, analysts included. It is a new game, and within 18 to 24 months, almost all cartel gold bullion will be shipped off their loading docks. Relax, as precious metal prices will regain its market with integrity. The gold price will skyrocket once they are done with what must be done. Sit tight. What you are seeing right now on price is totally irrelevant in context of the bigger picture."

A colleague confirmed a piece of what is happening. He has some excellent contacts. He wrote, "I know a guy who traded FOREX for Canada for 30 years. He said to me last week, regarding losses in FOREX, that many big banks are TOTALLY DRY OF CASH. ZIPPO."

The Days of Decline — Images from an Economic Collapse in Progress

Posted: 23 May 2012 04:59 PM PDT

by John Galt, Activist Post

The following video contains disturbing images compiled from the streets of Greece as protests, riots, and police response have converged amid austerity brought about by international banksters.

This is a familiar scenario the world over as divide-and-conquer techniques pit police against the very people it is in their best interest to protect … while the engineers of the collapse sit back and watch from afar. These images have continued to multiply throughout other collapsed economies, past and present, where the First World quickly can become the Third.

The conflagration that could take place in America amid a lethally armed population defies the imagination, which is clearly why the police state is oiling its machinery to take on the outraged and weaponized. We would do well to keep the following images from Greece as an up-to-date reminder of what violence produces.

Read More @ Activist Post

Richard Russell: We Are Entering Second Half of the Bear Market

Posted: 23 May 2012 04:02 PM PDT

With tremendous volatility in global markets, the Godfather of newsletter writers, Richard Russell, warned his readers that "something BIG is heading our way," and "I wonder how much longer the decline will continue to be orderly." Here is what Russell had to say: "As of today's closing, Dow down 14 out of 16 sessions! This is one you can tell your kids about. And still no collapse in breadth, and still no crash. The only thing I can make out of it is that a lot of people are standing their ground."


This posting includes an audio/video/photo media file: Download Now

SILVER MARKET UPDATE – David Morgan

Posted: 23 May 2012 04:00 PM PDT

from silverguru:

Europe’s ‘New Austerity’ – The Cheesecake Diet

Posted: 23 May 2012 03:40 PM PDT

by Jeff Nielson, Bullion Bulls Canada:

Austerity has failed. You won't see that in any of the headlines from the media propaganda machine, and for a very good reason: our intellectually bankrupt governments have no "Plan B".

The evidence of the colossal failure of Friedman Austerity is both abundant and unequivocal. Greece was an insolvent economy in steady decline when its own "austerity" was commenced. After two years of austerity it was totally bankrupt, and the economy had been so completely destroyed that even after defaulting on 75% of its debt further default already seems inevitable. Austerity transformed an economic decline into one of the most rapid economic collapses in modern history.

Then there is the UK. It began its austerity campaign shortly after Greece, but its own economic collapse is proceeding on schedule. Its monthly budget deficits continue to widen, with the UK government recently reporting i its largest one-month deficit ever for the month of February. Given that the entire raison d'etre of austerity is to shrink deficits, that statistic alone is proof of the complete and utter failure of UK austerity.

Read More @ BullionBullsCanada.com

CARTEL RAID UPDATE: The Coming Trigger Event Will Make Physical Disappear

Posted: 23 May 2012 03:16 PM PDT

CARTEL RAID UPDATE: Miles Franklin President Andy Schectman visits with us to set the record straight about this latest Bankster cartel raid. Guess what? NOTHING has changed. Andy says these slams are nothing more than a SUBSIDY and a gift. Physical silver IS money. Physical gold IS money. And if you don't hold it, you don't own it. Visit Miles Franklin here, and call Andy for a screaming good price on PHYSICAL.

Guest Post: Is China Really Liquidating Treasuries?

Posted: 23 May 2012 03:09 PM PDT

Submitted by John Aziz of Azizonomics

Is China Really Liquidating Treasuries?

The news that China has become the first sovereign to establish a direct sales relationship with the U.S. Treasury (therefore cutting out the middleman and bypassing Wall Street ) raises a few interesting questions.

From Reuters:

China can now bypass Wall Street when buying U.S. government debt and go straight to the U.S. Treasury, in what is the Treasury's first-ever direct relationship with a foreign government, according to documents viewed by Reuters.

 

The relationship means the People's Bank of China buys U.S. debt using a different method than any other central bank in the world.

 

The other central banks, including the Bank of Japan, which has a large appetite for Treasuries, place orders for U.S. debt with major Wall Street banks designated by the government as primary dealers. Those dealers then bid on their behalf at Treasury auctions.

 

China, which holds $1.17 trillion in U.S. Treasuries, still buys some Treasuries through primary dealers, but since June 2011, that route hasn't been necessary.

 

The documents viewed by Reuters show the U.S. Treasury Department has given the People's Bank of China a direct computer link to its auction system, which the Chinese first used to buy two-year notes in late June 2011.

The biggest Chinese outflows in U.S. Treasuries occurred in the months following the establishment of this relationship:

Which begs the question for some analysts — was China really selling? Or was China stealthily buying direct from the U.S. Treasury (unrecorded) and selling back into Wall Street (recorded)?

Well, according to the Treasury, the Treasury International Capital data seeks to record foreign holdings of U.S. securities, not just the flows, and given that the Treasury was the seller in these direct transactions (and so obviously was aware of them) there's no reason to believe that they wouldn't include any such direct outflows in the data. That suggests very strongly that yes, China really was selling.

And maybe the real reason that the Treasury offered China direct access (thus cutting out the middleman and offering China cheaper access than ever) was precisely because China was selling, and because the Treasury was concerned about the effect on rates, and wanted to give China some incentive to keep buying. As Jon Huntsman noted in a 2010 cable leaked by Wikileaks, the PBOC has felt pressured to keep buying, and as various PBOC officials have hinted in recent months, China is actively seeking to convert out of treasuries and into gold. And that makes sense — treasuries are yielding ever deeper negative real rates. People holding treasuries are losing their purchasing power. No wonder the treasury is willing to cut Wall Street out of the deal.

And it isn't like the Treasury would have taken this move lightly — cutting Wall Street out of the equation is a slap in the face to Wall Street.

This raises a much more interesting question — now that the PBOC has effectively been upgraded to primary dealer status, would the Fed start buying treasuries directly from the PBOC in order to manage rates downward and prevent a spike in Treasury borrowing costs should China choose to quicken the pace of a future liquidation, potentially bursting the treasury bubble?

James Turk: Only one defense against fiat currency -- dump it for gold

Posted: 23 May 2012 02:11 PM PDT

10:10p ET Wednesday, May 2, 2012

Dear Friend of GATA and Gold:

People moving their money from the periphery of the eurozone to Germany in pursuit of a safe haven may be in for a rude shock, according to GoldMoney founder, Free Gold Money Report editor, and GATA consultant James Turk. At the FGMR Internet site he writes today that transfers to German banks still may be forcibly converted back to reconstituted and devalued national currencies. "There is only one way to seek safety from fiat currency," Turk writes. "Exit the fiat currency system altogether" and buy gold. Turk's commentary is headlined "Preparing for the Grexit" and it's posted at the FGMR Internet site here:

http://www.fgmr.com/preparing-for-the-grexit.html

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.


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Prophecy Platinum (TSXV: NKL) and Ursa Major Minerals
Sign Combination Agreement

Company Press Release
Friday, March 2, 2012

VANCOUVER, British Columbia, Canada -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) and Ursa Major Minerals Inc. have signed a binding letter of agreement for a business combination through a proposed all-share transaction. In doing so Prophecy and Ursa have acted at arm's length and the transaction has been negotiated at arm's length.

Prophecy will issue one common share in exchange for every 25 outstanding common shares of Ursa. Ursa options and warrants will be exchanged for options and warrants of Prophecy on an agreed schedule.

Prophecy's offer represents a value of about $0.15 per each common share of Ursa based on Prophecy's share price of $3.70 as at March 1, representing a premium of 130 percent to Ursa's March 1 closing price of $0.065.

Prophecy is to subscribe for $1 million common shares of Ursa by way of private placement financing at $0.06 per share, subject to regulatory approval. Upon placement completion, John Lee and Greg Hall, current Prophecy directors, will be appointed to Ursa's board.

Prophecy thus will become a mid-tier resource company with a robust and diversified pipeline of platinum nickel projects, including:

-- The fully permitted open-pit Shakespeare PGM-Ni-Cu mine close to Sudbury, Ontario, infrastructure with near-term production capabilities.

-- The flagship Wellgreen (Yukon) PGM-Ni-Cu project with more than 10 million ounces of Pt-Pd-Au inferred resource. Drilling is under way and a preliminary economic assessment study is pending.

-- Manitoba's Lynn Lake Ni-Cu project with more than 262 million pounds Ni and 138 million pounds Cu measured and indicated.

For the complete announcement, please visit Prophecy Platinum's Internet site here:

http://www.prophecyplat.com/news_2012_mar02_prophecy_platinum_ursa_major...


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Sona Discovers Potential High-Grade Gold Mineralization
at Blackdome in British Columbia -- 13.6g over 1.5 Meters

From a Company Press Release
November 22, 2011

VANCOUVER, British Columbia -- With its latest surface diamond drilling program at its 100-percent-owned, formerly producing Blackdome gold mine in southern British Columbia, Sona Resources Corp. has discovered a potentially high-grade gold-mineralized area, with one hole intersecting 13.6 grams of gold in 1.5 meters of core drilling.

"We intersected a promising new mineralized zone, and we feel optimistic about the assay results," says Sona's president and CEO, John P. Thompson. "We have undertaken an aggressive exploration program that has tested a number of target zones. Our discovery of this new gold-bearing structure is significant, and it represents a positive development for the company."

Sona aims to bring its permitted Blackdome mill back into production over the next year and a half, at a rate of 200 tonnes per day, with feed from the formerly producing Blackdome mine and the nearby Elizabeth gold deposit property. A positive preliminary economic assessment by Micon International Ltd., based on a gold price of $950 per ounce over eight years, has estimated a cash cost of $208 per tonne milled, or $686 per gold ounce recovered.

For the company's complete press release, please visit:

http://www.sonaresources.com/_resources/news/SONA_NR18_2011-opt.pdf

ABSOLUTE BULLSHIT

Posted: 23 May 2012 02:10 PM PDT





"All propaganda must be popular and its intellectual level must be adjusted to the most limited intelligence among those it is addressed to. Consequently, the greater the mass it is intended to reach, the lower its purely intellectual level will have to be." –Adolf Hitler

US unemployment data is a lie....the entire country knows it...and the Fed not only believes the data is accurate, but they base their monetary policy decisions on it too?  



"If you tell a lie big enough and keep repeating it, people will eventually come to believe it. The lie can be maintained only for such time as the State can shield the people from the political, economic and/or military consequences of the lie. It thus becomes vitally important for the State to use all of its powers to repress dissent, for the truth is the mortal enemy of the lie, and thus by extension, the truth is the greatest enemy of the State." -- Joseph Goebbels




Fed's Kocherlakota:Higher Inflation Means Economy Closer To Max Employment
By Steven K. Beckner

(MNI) – Minneapolis Federal Reserve Bank President Narayana
Kocherlakota Wednesday warned there may be less slack in the labor
market than the employment data suggest, potentially resulting in more
inflation to which the Fed would have to respond.

The Fed's policymaking Federal Open Market Committee is charged
with seeking "maximum employment" along with "price stability," but
Kocherlakota said the FOMC faces "especially large uncertainty" about
the maximum level of unemployment that monetary policy can actually
achieve.

He said the maximum employment level the Fed can expect to attain
through monetary stimulus may well have been reduced (or the
unemployment rate increased) because of a "considerable deterioration"
in labor market efficiency.

Citing the increased difficulty firms are having filling job
openings in the face of reduced labor force participation, Kocherlakota
said some of the high unemployment may be "persistent," not
"reversible." If that is the case, he suggested, there is less
justification for further monetary accommodation.

Kocherlakota, who twice dissented against easing measures last
year, said above-target inflation is suggesting that the economy is
closer to "maximum" employment than many think and said the Fed "should
be responsive to such signals."

Other policymakers, he acknowledged, believe that the kind of
"structural" labor market problems he mentioned are minimal and that
most unemployment is "reversible" and hence are more inclined to support
further monetary easing.

Kocherlakota pointed out that, in its statement of longer-run goals
and monetary policy strategy issued in January, the FOMC said it could
not set an unemployment target because "the maximum level of employment
is largely determined by nonmonetary factors that affect the structure
and dynamics of the job market."

Kocherlakota emphasized that "the FOMC has no control over these
nonmonetary factors," including such things as "population trends, the
incentives built into the tax system, the incentives built into social
insurance safety nets, the returns to human capital accumulation for
young people, and simply social norms."

And he said changes in such nonmonetary factors "generate
fluctuations in the level of maximum employment achievable through
monetary policy — fluctuations that are often hard to gauge on a
real-time basis."

And so, he said, the FOMC "currently faces an especially large
amount of uncertainty about the level of maximum employment that it can
hope to achieve."

By way of illustration, Kocherlakota pointed to "a sharp decline"
in the employment/population ratio and to an "accelerated" decline in
the labor force participation rate.

Whereas firms usually hire more workers in a recovering economy, in
the recent period there has been "a decline in the ability of the labor
market to form mutually beneficial matches between workers and firms."

"In that sense, the labor market is less efficient," he said.
"Firms can't fill their available job openings as readily as we would
have expected in light of the high unemployment rate."

As a result, "labor market outcomes do remain notably worse than
prior to the recession," he said.

Although the unemployment rate has come down, so has the labor
force participation rate, and there has been "considerable deterioration
in labor market matching efficiency," he said.

Kocherlakota pointed to research showing that Sweden has suffered a
"permanent" increase in unemployment since its "triple crisis" of the
early 1990s and said "Sweden's experience forces us to contemplate the
possibility that the erosion in labor market performance that we've seen
in the United States over the past five years may be highly persistent,
even under appropriate monetary policy."

There are important policy implications for the Fed, he said.

The debate over whether labor market changes are "largely
reversible under appropriate monetary policy" or are "likely to be
highly persistent" means that "the FOMC is confronted with an unusually
high degree of uncertainty about the level of 'maximum employment' it
can achieve," he said.

"This uncertainty translates directly into a corresponding
uncertainty about the appropriate approach to policy," he continued. "In
particular, policymakers who see the deterioration in labor market
performance as reversible using monetary policy will typically favor
more accommodative policy than those who view the deterioration as more
protracted."

Kocherlakota said that, for him, the inflation rate is key to
determining how close the Fed is to the maximum achievable level of
employment or the minimum achievable level of unemployment. And the
signals are not good, he suggested.

"Inflation was distinctly higher in 2011 than in 2010 and continues
to run above the FOMC's target of 2%," he noted. "Even core measures of
inflation, which strip out energy goods and services, and food, went up
notably."

"I see these changes as a signal that our country's current labor
market performance is much closer to 'maximum employment,' given the
tools available to the FOMC, than the post-World War II U.S. data alone
would suggest," he said.

And he added, "appropriate monetary policy should be responsive to
such signals."
___________________________

ABSOLUTE BULLSHIT!!!
___________________________


NDAA 2013: Congress approves domestic propaganda



Propaganda is the transfer of information, ideas or rumors to purposely help or harm a person, and governments use such tactics to manipulate people's thoughts and opinions. The United States spends approximately $4 billion per year for propaganda efforts in countries such as Iraq and Afghanistan, but now a new defense bill is hoping to increase the budget to implement propaganda in America. Lucy Steigerwald, associate editor for Reason Magazine, joins us with her thoughts on the issue.
____________________________

Ask yourself:  Is Greece really the biggest threat to the World Economy?

No, but the TPTB [The Powers That Be] are determined that you believe this is so.

Why?

Because the biggest threat to the World Economy is the TPTB themselves.  Why else is the unraveling of JP Morgan's $70 TRILLION derivatives position being kept in the dark while we are bombarded 24/7 with the   "horrific prospect" of Greece leaving the Euro?

Did you know that there are 27 countries in the European Union, and ONLY 17, the Euro Zone, of them "presently" use the Euro as their currency?

European Union

The European Union (EU) i/ˌjʊrəˈpiːənˈjuːnjən/ is an economic and political union or confederation[10][11] of 27 member states which are located primarily in Europe.[12] The EU traces its origins from the European Coal and Steel Community (ECSC) and the European Economic Community (EEC), formed by six countries in 1958. In the intervening years the EU has grown in size by the accession of new member statesand in power by the addition of policy areas to its remit. The Maastricht Treaty established the European Union under its current name in 1993.[13] The latest amendment to the constitutional basis of the EU, the Treaty of Lisbon, came into force in 2009.

The EU operates through a system of supranational independent institutions and intergovernmental negotiated decisions by the member states.[14][15][16] Important institutions of the EU include the European Commission, the Council of the European Union, the European Council, the Court of Justice of the European Union, and the European Central Bank. The European Parliament is elected every five years by EU citizens.

The EU has developed a single market through a standardised system of laws which apply in all member states. Within the Schengen Area (which includes EU and non-EU states) passport controls have been abolished.[17] EU policies aim to ensure the free movement of people, goods, services, and capital,[18] enact legislation in justice and home affairs, and maintain common policies on trade,[19] agriculture,[20] fisheries and regional development.[21] A monetary union, the eurozone, was established in 1999 and, as of January 2012, is composed of 17 member states. Through the Common Foreign and Security Policy the EU has developed a limited role in external relations and defence. Permanent diplomatic missions have been established around the world. The EU is represented at the United Nations, the WTO, the G8 and the G-20.

With a combined population of over 500 million inhabitants,[22] or 7.3% of the world population,[23] the EU generated a nominal GDP of 16,242 billion US dollars in 2010, which represents an estimated 20% of the global GDP when measured in terms of purchasing power parity.[24]

Eurozone

The eurozone ( pronunciation (help·info)), officially called the euro area,[7] is an economic and monetary union (EMU) of 17 European Union (EU) member states that have adopted the euro (€) as their common currency and sole legal tender. The eurozone currently consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain. Most other EU states are obliged to join once they meet the criteria to do so. No state has left and there are no provisions to do so or to be expelled.

Monetary policy of the zone is the responsibility of the European Central Bank (ECB) which is governed by a president and a board of the heads of national central banks. The principal task of the ECB is to keep inflation under control. Though there is no common representation, governance or fiscal policy for the currency union, some co-operation does take place through the Euro Group, which makes political decisions regarding the eurozone and the euro. The Euro Group is composed of the finance ministers of eurozone states, however in emergencies, national leaders also form the Euro Group.

Since the late-2000s financial crisis, the eurozone has established and used provisions for granting emergency loans to member states in return for the enactment of economic reforms. The eurozone has also enacted some limited fiscal integration, for example in peer review of each other's national budgets. The issue is highly political and in a state of flux as of 2011 in terms of what further provisions will be agreed for eurozone reform.

On occasion the eurozone is taken to include non-EU members who use the euro as their official currency. Some of these countries, like San Marino, have concluded formal agreements with the EU to use the currency and mint their own coins.[8] Others, like Kosovo and Montenegro, have adopted the euro unilaterally. However, these countries do not formally form part of the eurozone and do not have representation in the ECB or the Euro Group.[9]

The probability that the expulsion of Greece from the Euro Zone will cause the demise of the World Economy is ABSOLUTE BULLSHIT!

Greece is a smokescreen, the ultimate in PROPAGANDA.  Greek debt pales in comparison to the debt bombs residing behind the curtains of the like of JP Morgan, Goldman Sachs, Citi Bank, Morgan Stanley, and Bank Of America.

Stop and consider for just a moment:

Why should the people of Greece...or Spain, Portugal, Italy, Ireland...yada-yada...be forced to make good on the losses of banks Dumb enough to loan people money they knew couldn't pay it back?

Why have American Taxpayers been forced to bail out banks dumb enough to loan people money to buy homes they knew couldn't afford to pay those loans back?

The only way to end and overcome the Global Financial Crisis is for the people of the world to give the banks the one finger salute!


Austerity has failed. You won't see that in any of the headlines from the media propaganda machine, and for a very good reason: our intellectually bankrupt governments have no "Plan B." … Jeff Neilson
___________________________

Bill Holder: [ http://lemetropolecafe.com ] [SUBSCRIBE TO PLANET GATA]

Who you gonna believe?

To all; the simple answer to the title?...The Austrians. Why? Because they have been right since before 1999 (really since 1913) AND for all the correct reasons. Yes, it was the Austrians who screamed "bubble" in 1998 and '99 about technology, it was the Austrians screamed "bubble" from 2004 to 2006 about real estate and it has been the Austrians screaming at the top of their lungs about the debt bubbles engulfing the globe. The thing is, the Austrians (like Ron Paul) have been demeaned, slandered and laughed at for years and years while all the while being absolutely correct (many times quite early) for all the right reasons.

Right now, we are exactly "where" the Austrians said we would arrive. The banking system is upside down, individuals are either bankrupt, going bankrupt or cannot and will not take on more debt. Sovereign governments have literally bankrupted themselves over the last 5 years trying to prolong and continue a system that in fact is a Ponzi scheme and cannot survive. It has been and still is the Austrian schoolers (scholars) that maintain that the problem is "the money" or the fact that the "money" that is used today is fake and in the end, utterly worthless. It was the Austrians who foretold of today's economic agonies, not the Keynesians, not the Monetarists, not CNBC's cheerleaders, no, just the Austrians and those who use just plain common sense.

So why do point this out and toot the horn of Austrian economics? Because what is happening now will affect you and your families fortunes for several generations and you need to follow the words of those who have been right for the right reasons and forecast the current endgame. If you did nothing else other than scratching the surface to find out the investment of choice currently of the Austrians it would be worth it. As you know, their "investment of choice" is Gold and Silver. They choose Gold and Silver because they ARE money in it's truest and most raw form.

Today, the Dollar is trading up versus the Euro which historically puts price pressure on commodities and sometimes Gold and Silver because at times they are viewed as commodities. With where we are and what is happening currently, Gold and Silver are NOT commodities. They are monies and the only monies that will save "investors" from what is happening. Europe is now in a currency crisis. This will be followed by Britain, Japan and let's not forget the "root of the problem", Dollars.

I am writing this because short term ANYTHING can happen from here and you MUST NOT be fooled into giving up your insurance. Truly, the ONLY monetary assets today that have true intrinsic value are Gold and Silver, NOTHING else does. Not Dollars, not Euros, Pounds, Yen or soon to be Drachmas, not certificates of deposit, not T-Bills or any other sovereign paper, NOTHING. Even if through paper games and margin calls, were Gold to trade down $200-300 or more, you cannot give it away for ANYTHING paper. Paper everything and anything can and will default either outright or through debasement, metals cannot and will not.

For Gold and Silver to be "down" based on the possibility that a bankrupt country may or may not exit a bankrupt currency union is a joke. A joke especially when the "chosen" alternative is another currency that is even more bankrupt and more fraudulent. Everything that "we" (Austrians) have told you all along have come true (given some patience), this final chapter where Gold and Silver become "re-monetized" during sovereign defaults will be no different. Have patience, have conviction and relax, don't let yourself get panicked out of the only assets that will save your butts when the current monetary system collapses into worthlessness. Regards, Bill H.
__________________________

Gold Price Down 1.8 Percent Closing $1,548.10

Posted: 23 May 2012 12:46 PM PDT

Gold Price Close Today : 1,548.10
Change : -28.20 or -1.8%

Silver Price Close Today : 27.50
Change : -.66 or -2.4%

Platinum Price Close Today : 1,412.30
Change : -44.10 or -3.1%

Palladium Price Close Today : 590.95
Change : -24.35 or -4.1%

Gold Silver Ratio Today : 56.29
Change : 0.32 or 1.01%

Dow Industrial : 12,502.81
Change : -1.67 or 0.0%

US Dollar Index : 81.75
Change : 0.12 or 0.1%

Franklin will be away until June 4th and wont be publishing commentary until that time.

Argentum et aurum comparenda sunt -- -- Gold and silver must be bought.

- Franklin Sanders, The Moneychanger
The-MoneyChanger.com
1-888-218-9226
10:00am-5:00pm CST, Monday-Friday

© 2012, 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 bubble has burst, primary trend down.

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. No, I don't.

Frontline On MF Global's Six Billion Dollar Bet

Posted: 23 May 2012 11:59 AM PDT

While the sur-realities of just what Corzine and the rest of the MF Global 'traders' did has been extensively discussed here and elsewhere, PBS' Frontline provides the most succinct (and relatively in-depth) documentary on just what occurred from how the corrupt CEO lobbied regulators who had the power to stop his risky bets to the endgame realization of the missing customer money. A narrative, not just of "a bet that went bad", but "a Wall Street morality tale". Must watch!

 

The story of Jon Corzine, the former head of Goldman Sachs and political power broker, who took over MF Global in the spring of 2010 with oversize ambition and a passion for risk. But after a massive bet on European debt turned sour, the firm lay in ruins, with more than a billion dollars of customer funds missing.

UPDATE: It appears our traffic has broken the PBS servers for now

Chapter 1: Six Million Dollar Bet - The Power of Jon Corzine

Chapter 2: Six Million Dollar Bet - The Final Days Of MF Global

Jim's Mailbox

Posted: 23 May 2012 11:55 AM PDT

Dear Jim,

This is just to let you know that I am more positive on gold to-day than I have been in months. I want to take this opportunity to thank you for your consistent support.

Last week I did have to come up with some cash to meet the margin, but I am

Continue reading Jim's Mailbox

Preparing for the “Grexit”

Posted: 23 May 2012 11:40 AM PDT

FGMR - Free Gold Money Report May 23, 2012 – The Grexit, or Greece’s exit from the euro, is becoming more likely, judging by how frequently it is mentioned these days. Unfortunately, preparing for it may be more difficult than many believe. Before addressing that point, I would like to first illustrate the extent of the problem. This chart was included in an excellent article by Mish (a/k/a Mike Shedlock) on his Global Economic Analysis website. He notes: “One chart is all it takes to prove a full-fledged European bank run…is well underway in the Club-Med countries and Ireland”, i.e., the so-called PIIGS. There is a lot more in Mish’s article, which I recommend reading. But I would like to use the above chart to make an important point about the Grexit. It is clear that money is flowing from the PIIGS into Germany, and the reason is simple. People in these periphery countries are fearful that if their country leaves the eurozon...


Dumb Money Buying Facebook, Smart Money Accumulating Undervalued Gold Miners

Posted: 23 May 2012 10:07 AM PDT

We are witnessing a few cautionary signs that indicate a radically overbought U.S. equity and bond market. Stealthily, the precious metals, and mining equities are bottoming. The strong uptrend in the equity markets since ... Read More...



Guest Post: Unemployment Insurance Schemes And The Dependency Of Welfare

Posted: 23 May 2012 10:05 AM PDT

Submitted by James Miller of the Ludwig von Mises Institute of Canada

Unemployment Insurance Schemes And The Dependency Of Welfare

In the Garden of Eden there is no scarcity.  Food, clothing, and shelter in are abundance.  Resources merely fall from the heavens upon command.  It is economic paradise precisely because economics does not exist.  The universal laws that hold in the world of scarce goods vanquish in the land of the plenty.

The vision of Eden is the politician's main source of employment.  That is, promising to lead the suffering masses toward utopia by government decree makes for great electoral results.  The voting fodder ignorant of economics falls in line to cast a ballot to grant themselves other people's money.  But of course many voters don't see it this way.  Their vision of the state is that of Eden.  They see the bureaucrats and enforcers capable of tapping an infinite pot of wealth to pass along prosperity to those subservient enough to put them in office.  This in turn has lead to the establishment of the welfare state and its plethora of entitlement programs.

For those who see the modern day welfare state as corrosive to the productive capacity of any given country, no where is this theory more evident than the scheme of unemployment insurance.  In a recent National Post article, the entitlement attitude was on full display:

Jenna Somerton views her layoff from a job at Algonquin College in June of 2010 as a blessing in disguise: She lived on employment insurance benefits for eight months, took stock and decided what she really wanted to do with her life.

Of course, she admits to taking advantage of her EI cheques at the beginning, after hunting for a job with no luck.

"I was thinking 'Free money, the government owes me, I paid for school … I deserve this," the 27-year-old Ottawa resident says now.

She soon got serious, using the subsidized income to hatch plans to start her own web development business. Some of her friends, she said, have not been so diligent.

"I've known lots of people on EI and I know a lot of them just stayed on EI and as soon as it ran out they started freaking out and then they started looking for jobs…. [The government] makes it so easy."

In Ms. Somerton's view, it is the government that owes her and she is rightly deserving of the "free" money.  Her error is unfortunately not unique.  The notion of the government not restricted by the amount of resources it is able to squander from the private sector is hardly touched on in what passes for informed opinion.  The reading of the editorial section in today's highly regarded newspapers often contains numerous recommendations on what the state can and should provide.  What is never eluded to is the real cost of government expenditures.  While it is a simple task to rattle off the dollar cost of a program, to truly gauge the price of the state, one must look at what may have been foregone to provide for the payment of taxes.

The proper understanding of government is that it is parasitical in nature.  It can only spend what it first forcefully takes.  Because the political class is beholden to how much theft it can get away with before sparking an enraged uprising, it also invents new schemes to not be reliant on tax collection alone.  This includes borrowing and accumulating debt; which is nothing more than the promise of future taxes.  And there is inflation which benefits the first receiver of new money, that is the state, to spend freely before prices adjust economy wide.

Whatever the devious method, each comes at cost to the taxpayer.  Again, the nominal price of taxation by itself is easy to calculate.  What is often neglected is what the pilfered funds could have been used for if left in the necessarily more prudent non-public sector.  It was recently came to light how the great technological innovator Apple Inc. sets up branches in cities with low corporate tax rates in order to lower its tax bill.  This is of course a great thing as Apple, constrained in income by how much it receives from consumers, is a better steward of scarce resources then the state.  Apple's tax avoidance is obvious.  The further technological innovations financed by money the government bandits don't help themselves to is not readily apparent.

The general public is blind to this state of affairs.  Many have been conditioned through years of public schooling to see the state as Eden.  The short term benefits of government transfer payments override any conceivable long term gains of genuine wealth creation in the private sphere.

Decades of the predominant welfare state have not only created a reliable voting constituency dependent on handouts, it has perpetuated the Santa Clause-like image of the state.  What isn't considered is the overall social degeneration that is a byproduct of the so-called "social safety net."  As noted economist Thomas Sowell explains:

While liberals may think of the 1960s as the beginning of many "progressive" trends in American society, cold hard facts tell a very different story. The 1960s marked the end of many beneficial trends that had been going on for years — and a complete reversal of those trends as programs, policies, and ideologies of the liberals took hold.

Teenage pregnancy had been going down for years. So had venereal disease. Rates of infection for syphilis in 1960 was half of what it had been in 1950. There were similar trends in crime. The total number of murders in the United States in 1960 was lower than in 1950, 1940, or 1930 — even though the population was growing and two new states had been added. The murder rate, in proportion to population, in 1960 was half of what it had been in 1934.

Every one of these beneficial trends sharply reversed after liberal notions gained ascendancy during in the 1960s. By 1974, the murder rate had doubled. Even liberal icon Sargent Shriver, head of the agency directing the "war on poverty," admitted that "venereal disease has skyrocketed" even though "we have had more clinics, more pills, and more sex education than ever in history."

As for black economic advances, the most dramatic reduction in poverty among blacks occurred between 1940 and 1960, when the black poverty rate was cut almost in half, without any major government programs of the Great Society kind that began in the 1960s.

Why be productive and take of yourself when someone else picks up the tab?  This isn't a cold hearted question but a basic recognition that in most cases, leisure and immediate pleasure are preferred to delayed satisfaction.

Back to unemployment insurance, no matter how much it is denied by entitlement apologists, there is no escaping the truth that if someone is paid not to work, they will generally not work.  As Murray Rothbard writes in his magnum opus Man, Economy, and State:

For almost all actors, leisure is a consumer's good, to be weighed in the balance against the prospect of acquiring other consumer's goods, including possible satisfaction from the effort itself.

People will always be economizing beings who make choices between how they spend their time and where they dedicate their labor.  The National Post article makes mention of this consideration among those on the dole as small business owners…

have found themselves competing with the EI system for workers who are weighing opportunity costs: Would I toil in a hard labour job for $10 an hour or not go to work for roughly the same amount of cash?

This reluctance to work was documented in a 2009 survey which found many businesses unable to hire those on the unemployment rolls:

A CFIB survey published in September, 2009, found 22% of small businesses owners had trouble hiring people who are on EI, as workers said they would rather continue collecting benefits than work in the more hands-on jobs. Another 16% said that in the past year, they had had an employee ask to be laid off so he or she could collect EI benefits (these rates were higher in Newfoundland and Prince Edward Island).

This is all a consequence of the welfare state which has institutionalized poverty instead of relieving it.  The real beneficiaries of entitlement programs are not the recipients but those who maintain their positions as gatekeepers to the money.  The saddening dependency of others and the government's monopoly over coercive tax collection is what provides them a steady stream of income.

As long as the public still operates under the fallacious assumption that the state is costless, they will continue to vote themselves into destitution.  Living standards will decline as productivity gains begin to taper off.  A generation of the entitled will soon find themselves deserving of nothing because the real wealth producers will have long since abandoned their efforts to serve others.

Host bodies only ever have so much blood to give.

A Persistent Problem

Posted: 23 May 2012 10:02 AM PDT

Dave Gonigam – May 23, 2012

  • Say it ain't so! Sudden realization that Greece is still a problem sends markets reeling: Dan Amoss braces you for the triage to come
  • Other market movers: Facebook descends into farce (or is it tragedy?) and "improving" housing numbers
  • Tales from zero-tolerance America: Man ticketed after saving son's life… students suspended for riding bicycles… artist jailed for, well, art
  • "Burning Chase" painter's latest opus… Readers rise to The 5's defense… Five free ways to preserve your purchasing power… and more!

Well, well… It's turning into another one of those "risk off" days. It turns out Greece hasn't been fixed yet.

Never mind that Greece is no more or less fixed now than it was two years ago. Nor will it be fixed in any sense of the word before the next round of elections on June 17… which is 25 days from now.

In the meantime, the herd of volatility is on a stampede this morning…

  • Every major U.S. stock index is down 1% or more. The S&P is once again threatening 1,300. The Dow is down to its lowest level all year
  • So much for gold's gains last Thursday and Friday: The bid is down to $1,542. Silver's been knocked back to $27.41
  • The rest of the commodity complex is getting smashed too: Oil is below $90 for the first time since October, copper is back where it was in January and the CRB index is down to late-2010 levels, at 281
  • Hot money is fleeing to the greenback. The dollar index has broken above 82 for the first time since September 2010, while the euro has sunk to $1.256, a level last seen in August 2010
  • Treasuries are also a beneficiary of the safety trade: The yield on a 10-year note is down to 1.72%. Not quite as low as the all-time record set last Friday, but close enough.

"The stage is being set for a potential Greek exit from the eurozone," says our macro strategist, Dan Amoss. "A Greek exit is very bad news for the banks in the rest of the PIIGS countries, because it will lead to another wave of bank runs."

During those bank runs, the European Central Bank will have to perform triage, deciding which of the PIIGS banks it can save. ECB leaders will want to make sure the banks they lend to will have adequate capital. They'll ask for guarantees from the PIIGS governments and the eurozone bailout fund.

The process is every bit as messy as it sounds. End result: "The political will to hold the eurozone together is weakening," says Dan.

Then again, Europe might not be the only thing spooking the market.

The Facebook debacle is reversing Marx's quip about how history repeats itself. What looked like a farce on Friday is descending into tragedy today. Or maybe fraud.

Shareholders are suing both Facebook and the IPO underwriter, Morgan Stanley. "To have what was perceived as a watershed IPO result in this kind of harm is deeply troubling," says one of the lawyers who filed the suit.

At issue is whether Morgan Stanley lowered its revenue estimates for FB, disclosing that information only to preferred investors, conveniently leaving it out of the prospectus and registration statement.

It matters not whether the allegations are true. After J.P. Morgan's derivatives debacle and the meltdown at MF Global, it's getting harder and harder for Wall Street to shake the impression that it's all a rigged game.

The Commerce Department turned in a sunny report on new home sales this morning… as if traders cared.

Builders unloaded an annualized 343,000 homes in April — better than the "expert consensus" was counting on.

But given the long view, beating expectations doesn't count for much.

One aspect of this report is back to "normal," however. Builders are sitting on 5.1 months of inventory. At the start of 2009, they were saddled with a year's worth.

It's not just a handful of U.S. states like Utah that seek to confirm gold's status as a currency: The Swiss are up to something too.

A committee of the Swiss parliament is holding hearings today on the introduction of a parallel currency known as the "gold franc."

"Buying gold bullion coins and bars and gold certificates requires professional advice in Switzerland," explains Mark O'Byrne of GoldCore, "and some other countries and banks are the largest providers. Even the smallest gold coins can cost a few hundred francs."

"One of the new gold francs, on the other hand, with a gold content of 0.1 grams, could be purchased for just 5 francs (at current prices) and would mean that gold became more widely owned by ordinary people in Switzerland."

That works out to $5.30, if you're curious.

"The proposal," Mr. O'Byrne goes on, "may lead to a wider debate about the Swiss franc and the role gold might again play to protect the Swiss franc from currency debasement."

The votes are in, and they're overwhelming: 96% of respondents to an online poll oppose a plan to yank the passports of people who owe more than $50,000 to the IRS.

As mentioned in The 5 last month, this charming idea turns up in a piece of legislation called the Moving Ahead for Progress in the 21st Century Act.

Our friends at International Living have the poll up and running right now. No, it's not a scientific survey. But "Americans across the political spectrum appear increasingly frustrated with what they perceive as restrictions in fundamental 'freedoms' and they see this latest act as just one more example," says International Living editor Dan Prescher.

If you want to chime in yourself, here's where to go.

"I couldn't believe it," says one Frank Roder — in the first of a trio of stories proving you don't have to offend the IRS to run afoul of the zero-tolerance society circa 2012.

Mr. Roder drove his 5-year-old son last week to a river bluff in Union County, N.J., to feed the ducks. The boy, doing what 5-year-olds are wont to do, jumped out of the truck and darn near ran off a 35-foot ledge.

His dad leaped out of the car and pulled the boy to safety just in time. The truck landed in the drink instead.

The officer who arrived at the scene cited Mr. Roder for failure to produce an insurance card — it was still in the truck — and failure to apply the emergency brake.

"He said, 'If you would have taken the five seconds to apply the brake, this never would have happened!'"

"I say, 'Really? And if I did and my boy stepped over the edge and fell instead of the Jeep, then where would I be?' He says, 'Jail, for child endangerment.'"

Seriously.

Meanwhile, the principal of a high school in Walker, Mich., suspended 64 seniors on the final day of class… for riding their bicycles.

"Students say more than 100 classmates participated in a three-mile bike ride to school that included escorts by a Walker Police cruiser and the mayor," reports MLive.com. "It was supposed to be a fun twist on the types of things that typically happen on senior prank day."

But the humorless principal, one Katie Pennington, was not consulted in advance, and thus took offense. "I am glad they made it here safely. It was a safety risk," she said. Even with a police escort, apparently.

Now the students are stuck rescheduling exams. At least they'll be allowed to attend commencement.

Meanwhile, police in New York can't tell the difference between art and a bomb… so they arrested the artist.

Takeshi Miyakawa created some illuminated shopping bags with the "I Love New York" logo, and hung them on some lampposts in Brooklyn — as part of an event called New York Design Week.

A passerby called the cops… who then called out the bomb squad and cleared the surrounding area for two hours. Mr. Miyakawa is now charted with "planting false bombs."

Even better, a judge ordered him to undergo a psychiatric evaluation, which could keep him in jail for up to a month.

[Ed. Note: Challenging as it may seem, there are still ways to fight back against government's growing intrusions. Laissez Faire Books executive editor Jeffrey Tucker has compiled 10 simple ones you can put to work at home right away.

His report is one of many benefits that come with membership in the Laissez Faire Club... including access to a new e-book every Friday. Please review Jeffrey's invitation here.]

At least one artist we've been following in The 5 is still thriving. Alex Schaefer's latest work is up for bid on eBay…

Readers might recall last fall, Mr. Schaefer set up his easel outside a Chase branch in Van Nuys, Calif., and proceeded to paint a similar picture — for which he was promptly visited by the local constabulary.

Fortunately for him, nothing came of it and his canvas fetched five figures.

"I'm still painting these because nothing has changed," Schaefer writes on his current listing, now up to $1,925 with a week remaining. "Banks continue to wreak financial terrorism across the globe and politicians continue to do nothing to stop them. But I think we are slowly waking up!"

"Banks have always been in the business of stealing money from their customers," writes an awake reader carrying on our Bank of America thread.

"In 1986, in Los Angeles, I started a business and was required to put $800 into an escrow account for utilities. It was there in case I was not able to pay for utilities. I was supposed to get my money back in seven or eight years, but never did."

"A few years later, BofA was found guilty of systematically not refunding these monies back to their clients. They were hoping that people forget them, and many did, myself included. But even if someone tried to get the money back, they were given so much red tape and runaround that most gave up. Banks have been thieves all along and never change."

"You haven't mentioned," a reader writes after yesterday's episode, "the new largest oil reserve of 3 trillion barrels in Utah/Colorado announced by the U.S. Geological Survey earlier this month."

"Largest oil reserve in the world — talk about energy independence! But will this administration advocate for development?"

The 5: Ah, the Green River Formation. Yes, 3 trillion barrels, about half of that recoverable. But development could be 15-20 years away, even if you factor out political tangles. Awfully hard to invest in now.

Meanwhile, huge shale formations already in development are building new fortunes right now. That's why Byron King is so jazzed on the sector… and its moneymaking potential for you.

"We all need to remind ourselves," says the first of several emails rising to our defense today, "that coins have three sides, objective journalists have at least two and closed-minded ideologues have only one."

This is in reply to the fellow who labeled us "closet Fox News sheep" for the cardinal sin of mentioning a link seen on the Drudge Report.

"Keep up the good work, and I actually do not see a bias," says another reader. "I guess that makes me one of those dreaded open-minded folks."

"When I read the ranting, complaining reviews about the Drudge Report as a poor source," writes a third, "I have to stop and think: I have watched American citizens, one by one, become opinionated idiots."

"Too many people today are narrow-minded and have allowed others to define them. Left, right, anti-Rush, pro-Obama, racist, Zionist, Marxist, Tea Baggers, the list is endless."

"I've come to the conclusion that I am a dying breed in this country. I can actually read material from any side, any angle and any writer and through a process of critical thinking, intelligence and the profound ability to determine the truth, throw away what doesn't matter."

"We have truly let the crazies, liars and lunatics guide us. Grow some skin, get your facts together and move on. To call Agora on the carpet for where they get their info, instead of the content and reliability of their info — well, there is a perfect example of an idiot that is led around by the nose."

"I just read through my first 5 Min. Forecast. I am always in search of someone or some organization that will tell the truth and back it up with facts. Thanks for the hard work you have to do to tell the truth.

"The problem we face today is that our people have been so inundated with 'untruths' we don't recognize the truth. We have been indoctrinated on the 'butter theory.' Our food industry has produced so many different kinds of artificial butter products and we have become so used to eating them we don't recognize the taste of real butter anymore."

"Keep up the good work. If you really want to know 'why' and 'how' we got ourselves in the mess we are in, you need to read the book The Road to Serfdom by Friedrich A. Hayek."

The 5: This editor first read it about 20 years ago. Addison Wiggin, our executive publisher and "leader of the pack," drew on it extensively when writing Empire of Debt with Bill Bonner.

"Not only is The Road to Serfdom still relevant in our own time," writes scholar Bruce Caldwell, "it has something else going for it, too. It is actually readable."

It's the edition thoughtfully edited by Caldwell that we offer at Laissez Faire Books.

"After 30-plus years in the grain business, through Dems and Repubs, and all of the high priced anal-ysts (intentional), you guys are , if nothing else, thought provoking and refreshing."

"Many would do well to pull their head out of their rear and think for a moment, as difficult and painful as that may be. Keep the light shining. I love this stuff."

"The highlight of my day is reading The 5 Min. Forecast," writes our final correspondent. "It is the only thing I read that tells it the way it is and not with some spin on it. You folks should have run for president; at least we would get the straight stuff. Keep up the good work."

The 5: Oh dear, not this again. "As flattering as the compliment appears to be," Addison wrote in this space last October, "should an election turn out this way, we'd demand a recount. Or an investigation."

Cheers,

Dave Gonigam
The 5 Min. Forecast

P.S. Addison's latest volume, The Little Book of the Shrinking Dollar, is still available as part of an unbeatable "package deal." The book lays out 47 ways to protect yourself as the dollar's purchasing power shrivels to nothing.

You can learn about five of those 47 ways right here.

The Dollar Oil Price Threat Will Hurry Gold's Role in the System

Posted: 23 May 2012 09:48 AM PDT

There was much more to Hilary Clinton's China and India trip than meets the eye. It was an acid test of the power of the U.S. to press its political will upon the world. The issue at hand was the U.S. trying to halt sales ... Read More...



Peter Schiff - Massive Turnaround for Gold & the Shares

Posted: 23 May 2012 09:34 AM PDT

With gold rallying a stunning $30 off the lows and gold shares staging a huge rally as well, today King World News interviewed Peter Schiff, CEO of Europacific Capital, to get his thoughts on what lies ahead. Schiff discussed stocks, and Europe, but first, here is what Schiff had to say about the massive turnaround in gold and the shares: "Well you know today was a pretty impressive day for the gold stocks. Recently the gold stocks have not been falling much with the price of gold. In fact, they've actually held up a little better in this downturn."


This posting includes an audio/video/photo media file: Download Now

Why Hilary Clinton Went to China

Posted: 23 May 2012 08:59 AM PDT

The Dollar oil price is the 'vital interest' went to protect...

read more

Reaping the Austerity Whirlwind

Posted: 23 May 2012 08:54 AM PDT

The outlook for gold and Silver Prices amid the crisis in Keynesian spending...

read more

Trader Dan interviewed at King World News on Gold and Gold Stock Action

Posted: 23 May 2012 08:30 AM PDT

[url]http://www.traderdannorcini.blogspot.com/[/url] [url]http://www.fortwealth.com/[/url] Please click on the following link to read my interview with Eric King on the KWN network about today's price action in both gold and the gold shares. [URL]http://tinyurl.com/bvkjsfq[/URL] ...


Gold Seeker Closing Report: Gold and Silver End Only Slightly Lower

Posted: 23 May 2012 08:22 AM PDT

Gold reversed early losses in Asia and bumped back up to $1564.42 in early New York trade before it fell all the way back to $1533.50 by a little after noon EST, but it then stormed back higher in late trade and ended with a loss of just 0.36%. Silver slumped to as low as $27.122 before it also rallied back higher and ended with a loss of 1.03%.


Gold Daily and Silver Weekly Charts - V Bottom Ahead of Option Expiration?

Posted: 23 May 2012 08:09 AM PDT


This posting includes an audio/video/photo media file: Download Now

US Treasury Bond Tower of Babel Teeters

Posted: 23 May 2012 08:00 AM PDT

by Jim Willie CB May 23, 2012 home: Golden Jackass website subscribe: Hat Trick Letter Jim Willie CB, editor of the "HAT TRICK LETTER" Use the above link to subscribe to the paid research reports, which include coverage of critically important factors at work during the ongoing panicky attempt to sustain an unsustainable system burdened by numerous imbalances aggravated by global village forces. An historically unprecedented mess has been created by compromised central bankers and inept economic advisors, whose interference has irreversibly altered and damaged the world financial system, urgently pushed after the removed anchor of money to gold. Analysis features Gold, Crude Oil, USDollar, Treasury bonds, and inter-market dynamics with the US Economy and US Federal Reserve monetary policy. The Biblical story is told of a tower built ever higher in order to achieve contact with the heavens, lest they be scattered upon the earth. Th...


Lacy Hunt: The Bang Point

Posted: 23 May 2012 07:24 AM PDT

Synopsis: A renowned economist argues that the potential for China to suffer a catastrophic economic collapse is greater than it is for the US or Europe. Below is the concluding segment of the thought-provoking interview we conducted with Dr. Lacy Hunt. He offers some intriguing ideas regarding which of the national dominoes might be first to fall, and reminds us that there is more than one way to get out of a sovereign debt-crisis situation. For those who haven't seen it or would like a refresher, Part 1 of the Lacy Hunt interview is available for viewing or reading in our archives. [Lacy Hunt made a strong a case for investing in government bonds at our recent Recovery Reality Check Summit. Even if you disagree with his investment strategy – which we do – know this: He's made his clients a ton of money in recent years in the bond market. Dr. Hunt outlined his bond investment strateg...


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