Gold World News Flash |
- Asian Metals Market Update
- Society Is Crumbling Right In Front Of Our Eyes And Banning Guns Won't Help
- The Queen Inspects Other Countries’ Gold
- Uh Oh, Nancy Lanza Was a ‘Prepper' — The New Accusation: She ‘may have triggered son Adam Lanza's gun rampage'
- Guest Post: How To Spot A Hypocrite In The Gun Debate And Other Reflections On Newtown
- The Main Stumbling Block Of The Abe Administration: Diarrhea?
- Oh What a Tangled Web We Weave
- Why We’re Ungovernable, Part 5: Japan “Would Be Manageable, If Only…”
- What's Up with Gold?
- Guest Post: The Two Charts You Should See Before Risking A Dime In The Market In 2013
- Scared Again, As Usual Anymore, About Taxes, Debt And Inflation
- We Are Headed To A Historic Collapse Of The Financial System
- JP Morgan Admits That "QE Will Offset Almost All Of Next Year’s Government Deficit"
- Smashing The Big Banks: Only The First Step
- SILVER Window of Opportunity @ $29.68 – $26.23 by Jan 18 2013?
- Owning Gold Bullion Can Help Boost Your Global Net Worth! Here?s Why
- Gold and Silver
- Market Report: Gold Vs Gold Stocks ($HUI) Who is Leading Who?
- Palladium – The New “Gold”?
- Our Path To Collapse Will Impact Everyone Around The World
| Posted: 17 Dec 2012 12:02 AM PST The US fiscal cliff issue will be the key for markets. I am not looking too seriously into the US fiscal cliff issue and am rather focusing on incoming economic numbers from the USA, Europe and China. If incoming US economic numbers are bad then gold and silver demand will rise further. Gold and silver are in a consolidation phase and not in a bear zone. |
| Society Is Crumbling Right In Front Of Our Eyes And Banning Guns Won't Help Posted: 17 Dec 2012 12:00 AM PST from The Economic Collapse Blog:
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| The Queen Inspects Other Countries’ Gold Posted: 17 Dec 2012 12:00 AM PST Iacono Research |
| Posted: 16 Dec 2012 11:38 PM PST [Ed. Note: The bought-and-paid-for mockingbird media quite literally knows no shame. With this tragic event they can demonize gun owners AND "Preppers". They are truly pathetic.] from news.com.au:
Friends and family portrayed Adam Lanza's mother Nancy as a paranoid "survivalist" who believed the world was on the verge of violent, economic collapse. She had been stockpiling food, water and guns in the large home she shared with her 20-year-old son in Connecticut. Mrs Lanza, 52, was a "prepper" – so called because they are preparing for a breakdown in civilised society who apparently became obsessed with guns and taught Adam and his older brother, Ryan, how to shoot, even taking them to local ranges. That backfired horrifically on Friday when Adam Lanza began his killing spree by shooting his mother dead in bed. |
| Guest Post: How To Spot A Hypocrite In The Gun Debate And Other Reflections On Newtown Posted: 16 Dec 2012 07:05 PM PST Via Michael Krieger of Liberty Blitzkrieg blog,
For those of you that follow me on twitter, some of the statements and themes you will read in this article will sound familiar. What happened on December 14, 2012 was obviously a horrific tragedy that my simple mind can't possibly wrap itself around, but what I can do is send my deepest thoughts, prayers and sympathies to all of those affected. I can't imagine the level of pain and suffering you are all experiencing. This article; however, isn't directed at you. There is nothing I can do to ease your pain. This article is for the rest of us who weren't directly affected by the incident, but may be indirectly affected by certain parties' emotional response to it and by those that will exploit it to justify agendas. One of the key lessons from all of human history is that the easy way to deal with any tragedy is to scapegoat. In some cases, like in Nazi Germany, the scapegoat proved to be unpopular minorities, especially Jews. These days, many Americans have fallen into the trap of scapegoasting Muslims and the Islamic religion for all the bad things that happen on the planet. The key similarity I see in these sorts of situations is that the population affected by some trauma (hyperinflation and economic collapse in Germany and 9/11 in the United States) tends to resort to the knee-jerk reaction of scapegoating an easy target rather than diving into the complexities of the issue and engaging in societal self-reflection. This is extraordinarily dangerous. From what I can tell, some of the most ridiculous policies are the direct result of a trauma, people getting emotional, and then begging for a response. In my own lifetime, 9/11 is the perfect example. Our national response to a gruesome attack that killed thousands of innocent civilians was to tear up the Constitution, specifically the cherished Bill of Rights, with insane Big Brother type legislation like the "Patriot" Act. We basically launched the war on terror by waving a white flag. Truly defeating terrorists wouldn't have consisted of running to the mall and shopping, as George W. Bush insisted, or giving up the freedoms that made America the most attractive country to move to for the last two hundred years. The way to judge victory or defeat in the "war on terror" eleven years later is not to check the statistics on terrorist attacks. The way to judge victory or defeat is to look at the nation economically, socially and politically and ask yourself are we better off or worse off? I think the verdict is clear on that front, and I do in large part blame our childish and emotionally reaction to the national tragedy of 9/11. Well here we stand in mid-December 2012, just days from the Mayan end of the world and another national tragedy has been unleashed on the land. Most of the victims were innocent, helpless six and seven year old children that never even had the chance to fulfill their potential on this planet. Unfortunately, just as Ron Paul told us, key parts of the Patriot Act were written and desired by certain factions well before 9/11, there is a powerful faction in the highest echelons of the elite that have wanted and continue to want to remove guns from the hands of innocent American citizens. These people are not interested in easing violence; these folks want to disarm the public before the mathematically inevitable economic collapse occurs (see my article "Slaves are Always Disarmed"). While many of these folks claims publicly that there is an "economic recovery" and happy days are just over the horizon, they know better and privately want to get all their ducks in a row before the final and horrific collapse occurs. This is why the surveillance state is making such aggressive strides at the moment. It is also why there is a panic to remove firearms from the public. The person who bothers me the most on this entire topic is Mayor Michael Bloomberg, of my hometown NYC. You can tell when someone is disingenuous if they freak out over gun violence like it is the biggest issue in America today and at the same time protect the banksters and their "too big to fail" culture, which has and continues to systemically steal trillions of dollars from the poor. This is Michael Bloomberg to a tee, so this man should have no credibility on any moral subject when he protects and coddles the most dangerous criminal organizations on this planet. I guess there is something "liberal" about white collar crime.
The other way to spot a hypocrite is to see whether they ever speak out about other acts of violence, or if they only open their mouths when it comes to gun incidents. I see this attitude all over the "fake left" landscape. If someone you know, or someone in the media never decries American drones strikes that kill children regularly in the forgotten parts of the globe, yet jumps at every gun incident like it is the end of the world, that person has an agenda. That person hates guns, not necessarily violence. They do not have a clear head in this argument. Zerohedge put together an excellent article yesterday called Newtown Shooter Had Asperger Syndrome, And Some US Gun Facts, which I suggest everyone read. They go into the fact that mental illness seems to be the determining factor in most of these shooting incidents and also points out that the deadliest school massacre in U.S. history was The Bath School Disaster, which was carried out with dynamite, not firearms. Care of justfacts.com we learn that:
The interesting thing about all of this is because of differentiated gun laws in these United States we can see how effective gun bans really are in the places where they are in effect. The answer seems to be not very effective. This shouldn't come as much of a surprise, as what ends up happening with gun bans is that only criminals end up with guns. A criminal will not obey the law, and even in the Newtown shooting case, these weren't Adam Lanza's guns. He stole them from his own mother. For the record, I'd love a world without guns, but as long as criminal governments have them and start wars, the people have the right as well. The actions of one or several mentally ill people should not lead to the restriction of a Constitutionally enshrined right for the hundreds of millions of law abiding, honest citizens that use firearms responsibly. In fact, with an estimated 300 million firearms within these United States, I'd say it's somewhat impressive how little gun violence there is. Unfortunately, going forward, I expect gun violence to escalate. I don't think this is a result of the number of guns as much the result of increased poverty and societal marginalization as a result of the economic catastrophe we are witnessing. A direct result of criminal theft by the TBTF financial institutions that gun haters like Michael Bloomberg protect and serve. It is also the result of the increasingly sick culture that has developed in America. One that is in many ways a reflection of the sickness and depravity at the very top of U.S. society emanating from the political and economic oligarchs. It reminds me of the anti-drug commercial from the 1980?s where the son says to the father "from you dad, I learned it by watching you." It's the same with violence in America. Our own government leads by example. Recall the words of Justice Brandeis before jumping to emotional conclusions on the gun debate. We already made that tragic mistake once this millennium. Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a law-breaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. Peace and wisdom, |
| The Main Stumbling Block Of The Abe Administration: Diarrhea? Posted: 16 Dec 2012 05:50 PM PST As we pointed out earlier today, Japan's new Prime Minister Shinzo Abe, is really Japan's old Prime Minister Shinzo Abe, who in September 2007 quit after precisly one year in the PM post, despite having been groomed his entire life just for the position. His tenure was, in short, a sheer disaster. The Economist summarizes it as follows: "Mr Abe's government was initially very popular. Yet the tide in Mr Abe's affairs only ebbed. True, early on he made a notable opening towards China, with whom relations had been strained under Mr Koizumi. Other than that, Mr Abe proved unable to impose discipline upon a cabinet of the corrupt and incompetent. Worse, he had a tin ear for the political mood. Voters, it had turned out, had been beguiled more by Mr Koizumi the messenger than by his message of structural reform, which entailed pain and uncertainty, notably in Japan's rural regions and among the old. Mr Abe failed to address these concerns."
And thus began the slide of the LDP, which soon thereafter saw its uninterrupted run of 50 years at the helm of Japan end, with power handed over to the DPJ. Yet what was the gracious "exit" pretext that Abe used to evacuate his leadership spot without admitting defeat? Diarrhea. Yup: diarrhea. The aptly named Japan Probe explains:
Surely, the complete collapse of public support for his government had nothing to do with the spike in his bathroom runs:
Meet Asacol: the miracle drug that has once again replaced the fecal debilitation with fiscal: One politically correct take:
A less politically correct take, of course, is that in a world in which there is a scapegoat for each and everything that can go wrong (hot weather, cold weather, a tropical storm, a tornado, an earthquake, people buying too much, people not buying enough, etc., etc., and in short all those other things that happens while central planners use their priced_to_perfection.xls models), the explosive diarrhea was merely the excuse to afford Abe a graceful exit stage left. We wonder what physical ailment will be scapegoated by the brand (or not so brand) new PM three to six months from now, when this time is shown to not be different, when Japan once again lapses into deflation's loving caress, and when in response to the imminent QE 10, 12, 13 and so forth from the BOJ, the other, far more aggressive "developed world" central banks react in kind, and in turn send the JPY soaring (and the near record high JPY shorts scrambling for the exits). |
| Oh What a Tangled Web We Weave Posted: 16 Dec 2012 05:31 PM PST If this doesn't piss you off, nothing will. Let's just solve all our problems by making the BIG LIE official policy of the Government (as if it isn't already!). Now the FED is going to set it QE4EVA policy based on unemployment – which figures are just as big lies as the "official" CPI rate which understates inflation by a minimum of 7% (Official CPI year over year: 2%, true year over year is 9%). So what do we do? Modify the way the CPI is figured, yet once again, so any adjustments to payments made based on the "official" CPI will be lower – saving the Goobermint money and putting the greased pole to anyone receiving benefits. Now benefits from Medicare, Medicaid, welfare, Obamaphones, SNAP and Social Security are going to have to be reformed and probably cut. But WHY IN HELL CAN'T THE GOVERNMENT BE HONEST AND SAY, "Hey guys and girls, we're going broke and can't afford these entitlements." instead of LYING about it, not reducing Gooberment spending, fraud and abuse, cut Federal salaries (especially the automatic pay raises CONgress awarded themselves) and everyone share the pain? This "suggestion" sucks and John Rubino calls them on it..
Hat tip to John Rubino
By the age of 12 or so, most people have learned through bitter experience that dishonesty is hard to pull off, because one lie tends to require more lies, until the complexity of the situation exceeds the liar's ability keep everything straight. This is just as true for governments as for individuals, especially when it comes to money. A currency that holds its value over long periods of time is nice but restrictive, because it limits a government's ability to fight multiple wars and buy votes with generous social programs. So every government eventually resorts to monetary inflation, which is a combination of theft and deceit – or fraud, as it's known in legal circles. By creating large amounts of new currency, a country lowers the value of each piece of currency in the hands of citizens, thus secretly taxing them to run the government. Then, to mask the effects of this stealth tax, governments distort their reported economic statistics to portray a world that's healthier than the one most people experience. The goal is to siphon off as much wealth as possible while keeping the victims docile for as long as possible. The longer the con runs, the richer the people at the top become. Eventually the gap between government reports and individual experience grows so wide that the lie is revealed and the scam ends, either through some sort of revolution or a financial collapse or both. A sign that we're approaching that point is the following article, in which Time Magazine advocates making a heretofore-unspoken part of the con explicit government policy: Fixing Inflation Adjustments Is the Smart Way to Shrink the Deficit Let's face it: There's no way to reduce America's budget deficit that won't hurt someone, and that pain can't be limited only to the rich. A payroll tax, passed in 2010, is scheduled to expire at the end of this year, for example, and that will cost middle-class households anywhere from $600 to $1,200. In addition, more than 20 million taxpayers could become subject to the alternative minimum tax (AMT), adding several hundred dollars to their annual tax bills on average. On the spending side, budget cuts would not only reduce government services but could also eventually cost tens of thousands of Americans their jobs. But there are other ways to make progress on the deficit over the long term that would be a lot less painful and would also be politically viable. In my last column, I wrote about the estimated $30 billion a year that the Federal government could save by getting really tough on fraud. Even more could be done, though, by changing the inflation adjustments for government spending. Cost-of-living adjustments (COLAs) are used throughout the U.S. economy – for union contracts and income tax brackets, as well as for government entitlements. It may seem only fair to adjust contracts and government programs for inflation – otherwise recipients would see their standard of living steadily erode over time. But there are a lot of ways to adjust for inflation. Moreover, the most commonly used gauge, the Consumer Price Index (CPI), may overstate the adjustment needed. Switching to a more conservative measure could save as much as $200 billion over the coming decade. The most commonly proposed change is to replace the CPI with another index called the "chained CPI." Basically, inflation is calculated based on putting together a basket of commonly bought goods and services and then tracking the price increases for them. In reality, though, people don't consistently buy the same things. If one particular item – steak, for example – gets very expensive, people will typically buy something cheaper instead, such as chicken. The chained CPI takes into account the substitution of cheaper items for things that get too expensive, and is therefore arguably more accurate than the regular CPI. It also rises a little bit more slowly. The result of replacing the regular CPI with the chained CPI would be slightly slower increases in monthly Social Security payments and some other government benefits. The new measure would also modestly boost tax revenues. The reason: tax brackets are indexed to inflation and would ratchet up more slowly if the chained CPI were used to adjust them. For many taxpayers, that would mean that some of their income would fall in a higher bracket. Further savings could come from changing the formula used to calculate initial Social Security benefits. Because Social Security was originally designed to mimic a pension plan rather than look like a welfare entitlement, initial benefits are pegged to retirees' earnings over their working lives. Because the general standard of living improves over time, wages and salaries normally outpace inflation – and so do initial Social Security benefits. (After benefits have begun, further increases are based on a more usual cost-of-living adjustment.) Some economists have long argued for altering the formula for initial benefits. Keeping the current more generous earnings-based calculation for lower-income retirees but switching to an inflation-based calculation for the more-affluent half of the population could eliminate half of the Social Security deficit over the next 75 years. Such fixes to benefit plans are not uncontroversial. When a recent Republican budget proposal included changes to the way the Federal government calculates inflation, the idea was swiftly rejected by some Democrats. Opponents of the idea objected that retirees face higher inflation than the average American because of health-care costs and that some of the tax increases would fall on the middle class. It's true, of course, that altering inflation adjustments will limit future benefit increases and cause an upward creep in income taxes. But the idea that the Federal deficit can be brought down to sustainable levels without anyone giving up anything is simply unrealistic. Hiking tax rates on the rich alone will raise enough revenue to cut the deficit only by about 8%. In the end, simple arithmetic ensures that the bulk of deficit reduction will come from the middle class – the challenge is to minimize the pain. Unfortunately, tinkering with inflation adjustments will be little help with other runaway costs – most significantly health care, which presents even greater long-term budget problems than Social Security does. Advances in medicine often make treatment more expensive. In addition, health care is labor intensive, and in all service sectors it's hard to offset rising labor costs with the sort of productivity gains that can be achieved in manufacturing. Doctors can only see so many patients an hour, teachers can only correct so many papers, and there's a limit to how fast a pianist can play the minute waltz. But where rising costs are chiefly the result of inflation adjustments, fine-tuning those mechanisms may be the least painful way to start bringing down the long-term deficit. The spending cuts that are currently scheduled to go into effect next year in the absence of a budget deal look horrific and could result in 7% to 9% reductions in a broad range of Federal programs. Surely it seems more rational to minimize the need for such sudden, deep, and indiscriminate cuts in the near term by accepting smaller increases in government spending over the coming decades. Some thoughts: Put more clearly, US voters are enabling the liars because – despite the mounting evidence that the lies are coming at our expense – we prefer the comfort of those lies to the harsh reality of no more free money for the lifestyles we thought were our birthright. The result of dishonest public policy being enabled by voters in denial is a corrupt society, where lying – as in the article reprinted above – becomes acceptable public policy. We're not far from the old Soviet joke, "we pretend to work and they pretend to pay us." |
| Why We’re Ungovernable, Part 5: Japan “Would Be Manageable, If Only…” Posted: 16 Dec 2012 05:06 PM PST Japan's government has fallen — again:
Some Thoughts So for Japan, internal party politics or disagreements about US military bases are just symptoms of the underlying problem, which is its willingness to borrow insane amounts of money. In the aftermath of the stock/real estate bubble of the 1990s, Japan chose to prop up its failing banks and construction companies instead of letting them fail. It borrowed money for bailouts and public works programs that succeeded in staving off a collapse, but at the cost of ever-higher public debt. Today, no other major country's government debt/GDP ratio is even close to Japan's 200%.
So the question isn't whether the next government will fix things. It can't because there is no fix. The question is whether the next government will preside over more low-level turmoil or the final implosion of a non-viable system. This of course brings us back the US, which has chosen almost exactly the same path. Instead of liquidating three decades of malinvestment when we had the chance, we followed Japan's lead by propping up the banking/real estate/local government sectors with borrowed money. Where Japan recently chose to increase stimulus spending and pay for it with newly-created yen and a doubled sales tax, we are increasing government spending and paying for it with newly-created dollars and higher income taxes. Yet for some reason we expect a different result… Click here for the rest of the "Why We're Ungovernable" series. |
| Posted: 16 Dec 2012 03:57 PM PST Watching the price action of gold on Wednesday after the Fed announced it was going to double down on quantitative easing, it was hard not to conclude that the precious metals were at risk of another leg down. After all, here was Capt'n Ben announcing that the Fed helicopters were going to drop an additional $40 billion a month, bringing the dollar deluge to a whopping $85 billion a month – $1.02 trillion a year – and instead of soaring, the precious metals barely squeaked out any gains at all. Sure enough, confirming my fears, in the overnight markets heading into Thursday, the prices of gold and silver were both smacked down smartly. That this happened immediately on the heels of the Fed's announcement was concerning enough, but it's actually worse than that. I say that because earlier this week Mark Carney, the incoming head of the Bank of England, the equivalent of the Fed, made a speech essentially stating that upon assuming his new job, he, too, would be advocating a large and open-ended quantitative easing. Ditto, the sure-to-be-elected new prime minister of Japan is basing his successful campaign platform on much the same idea – an unlimited amount of new quantitative easing. Likewise, the ECB is shifting toward an accommodative policy. In essence, in a deliberate attempt to spawn a global wave of inflation, it became clear this week that the Western world's major central banks have fallen lock-step behind a coordinated policy of extraordinary and unprecedented currency debasement. Yet, gold and silver take it in the neck. What's going on? A conspiracy-minded individual would no doubt blame "da boyz," and who knows, they could be right. After all, gold's role as the "anti-fiat" makes it a very inconvenient barometer for the monetary malfeasance committed by the grasping governments on a daily basis. Should attitudes about gold change to the point where the public loses faith in it as the currency of last resort, said governments could continue picking the pockets of the public pretty much unmolested. Yet motive alone is insufficient to convict. Until I see a smoking gun – versus the anecdotal and circumstantial evidence being waved around – I can't say one way or the other if manipulation is going on. In fact, there are other signs in the economy that something bigger is going on. For example, the VIX volatility index is acting positively schizophrenic. So, is that also being manipulated? Here's a snippet from a very interesting and important article that appeared on PragCap.com this week and was brought to my attention by David Franklin of Sprott Asset Management. To compare the current VIX levels to macro fundamental risk, we have performed a simple quantitative exercise: we compiled a list of 484 macro indicators published by Bloomberg that have a significant correlation to the VIX index and regressed them against the current reading of the VIX. You can read the full article here. Simply stated, like the counterintuitive reaction of gold, the key indicator of volatility (and by extent, market risk), VIX, has broken free of long-standing correlations to other major market indicators. Whereas those other market indicators suggest that VIX should be much higher than it is, it is currently bouncing along at levels one would expect to see in a healthy economic climate, versus the veritable economic tuberculosis ward we live in with governments infecting each other, and their respective populations, with highly contagious and dangerous levels of debt. The usually reliable bond markets are also asleep at the switch, despite the fact that the US government budget deficit for October and November, the first two months of the new fiscal year, were 24% higher than in the same two months last year. In other words, not only is government not addressing its deficit problems – it's significantly accelerating said deficits. Yet bond yields remain near all-time lows, a sure sign that all is well. Couldn't the disconnects be signs that the economy is recovering? After all, in the months leading up to the US presidential election, the unemployment rate fell below the 8% mark – rather conveniently, some obstinate anti-Obama observers observed. Turns out they may have been right. Here's another snippet, from CNSNews.com, also forwarded by David Franklin earlier this week… 73% of New Jobs Created in Last 5 Months Are in Government In the same five-month period since June, the number of people employed by government increased by 621,000 to 20,559,000. These 621,000 new government jobs created in the last five months equal 73.3 percent of the 847,000 new jobs created overall. Read the full article here. Meanwhile, the number of people receiving food stamps in America surged by over 600,000 in September, the latest reporting period, the biggest increase in 16 months. So what's going on, really?
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| Guest Post: The Two Charts You Should See Before Risking A Dime In The Market In 2013 Posted: 16 Dec 2012 03:29 PM PST Via Charles Hugh-Smith of OfTwoMinds blog, Two charts suggest a major decline is ahead in 2013. "Don't fight the Fed," blah blah blah. Really? What did the market do after QE3 and QE4 were duly announced? It tanked. What if the Fed is out of tricks? It's not really a question; Fed chairman Ben Bernanke said as much in his press conference. It's not clear if the Ibogaine was wearing off or just kicking in, but the Chairman had an apologetic deer-in-the-headlights look of, "Gee, we're out of tricks and I'm sorry to have to tell you what is painfully obvious to everyone who isn't stoned silly on Delusionol (tm)."  Now that the Fed's magic hat is visibly out of rabbits, there are all sorts of complexities we could hash over such as the effects of bank charge-off rates on GDP or the Theater of the Absurd "fiscal cliff" play-acting, but why waste all that time and energy when a number of charts forecast trouble for the stock market in 2013? The first overlays bank derivatives with positive fair value against the S&P 500 (SPX), lagged 28 months. Is it cricket to lag or advance indicators? Technician Tom McClellanthinks so, as his forward-12-months eurodollar COT/SPX chart has been eerily prescient in forecasting major market moves in 2012. Here is an article on the chart: Stocks And Euro-Dollar Futures Positioning (11/7/12) Keeping in mind that there is no one indicator or chart that accurately forecasts market moves consistently over time, consider this overlay of bank derivatives and the SPX:  Charts courtesy of longtime correspondent B.C. Hmm. If there is a correlation here, it doesn't look positive for equities in 2013.Those familiar with McClellan's chart know that it forecasts a serious decline in the SPX in early 2013, followed by a countertrend rally that tops in May. The decline after May is the Big One that punishes everyone who stayed long the SPX. Next up, a long-term chart (from 1973 to the present) of the SPX, adjusted to the trade-weighted U.S. dollar. Were this basic A-B-C pattern to hold, the SPX will reverse sharply in 2013 and fall to the nearest trendline around 600, with a drop into the 300s possible. Yes, yes, I know it's "impossible" since the "Fed has the market's back," but the Fed may have to buy most of the market if it wants to keep it elevated at current levels.  As a lagniappe, there is a third pattern suggesting a major decline just ahead:Three Peaks and A Domed House Pattern Signals An End To The Bull Market. Anyone who has studied a few charts knows that it is usually possible to torture a chart to fit the pattern one has already selected as the "likely outcome" (i.e. confirmation bias). But even with this caveat firmly in mind, 2012's SPX bears an uncanny resemblance to the classic Three Peaks and A Domed House Pattern. Here is another analysis of three peaks and a domed house. Could these charts be way off in their forecast? Of course. Nobody knows what the market will do tomorrow, much less next month or next year. Maybe the bulls predicting a new high in early 2013 will be proven correct. We will just have to see what happens. But as the saying has it, "Forewarned is forearmed." Thank you, B.C., for sharing your charts with us. |
| Scared Again, As Usual Anymore, About Taxes, Debt And Inflation Posted: 16 Dec 2012 02:54 PM PST December 14, 2012 Mogambo Guru Scared Again, As Usual Anymore, About Taxes, Debt And Inflation Perhaps not surprisingly, my career is suddenly going nowhere since I retired and quit working completely. For example: Is the wife asking me to take the garbage out? "What do I look like," I ask incredulously, "some kind of janitor, or custodian, or maybe a professional garbage-taker-outer? Ha! Screw that! You got the wrong boy, babe! That's work, and I'm retired!" Of course, this is my usual empty bluster and whining about how one day things are going to be different around here, see, and I will run the show -- with an iron fist! -- and everybody will do what I want for a change, and yet there I am, taking the damned garbage out to the damned garbage can, but grumbling and mumbling incoherently under my breath to show that I am not the least bit happy about it. However, if I ever decide to return to writing, willingly suffering the slings and arrows of outrageous editors ("Worthless trash from a no-talent hack"), I will apply at Reuters news service as a hot-shot editor, since I obviously have a knack for seeing the profound writing mistakes made by others, taking a cruel joy in hurting the writer's feelings because, I self-righteously ask, where were in the hell were THEY all those years when I was being criticized ("Worst crap I have ever read! I feel soiled from the experience!"), crying myself to sleep every night, boo hoo hoo. You are probably saying to yourself "Who cares? You ARE a crappy writer! Is there a point to all of this? Is it because Reuters wouldn't even let you take their garbage out because you are a stupid, raving lunatic?" "No," I imperiously say. "It's not about that at all. What I am talking about is how Reuters treats a simple news item like "The U.S. Internal Revenue Service on Wednesday released final rules for a new tax on medical devices, products ranging from surgical sutures to knee replacement implants, that starts next year as part of President Barack Obama's 2010 healthcare law." Reuters goes on to explain that "The 2.3-percent tax must be paid, effective after December 31, by device-makers on their gross sales. The tax is expected to raise $29 billion in government revenues through 2022." Now get a load of this: The tax "applies mostly to devices used and implanted by medical professionals, including items as complex as pacemakers or as simple as tongue depressors," which is kinda scary since, apparently, medical professionals "use and implant" tongue depressors in people! Yikes! I had no idea! Anyway, despite my little attempt at humor that seems to have fallen somewhat flat, that is pretty much it. End of story! If I was indeed the intrepid editor of this news story, and I had made it back to the office not too late from one of my famous two-hour power-lunches, and I was not too falling-down, snot-faced drunk to actually manipulate at least one of my fingers, I would sit at my keyboard and edit that last sentence to read "…which means only that the device-makers will happily charge more money for their devices so that the company can still make the same profit after paying another 2.3% tax, which means that the prices of medical devices will go up, which is popularly defined as inflation, which is a kind of tax paid by consumers, or companies will go out of business because their prices are now too high, whereupon all the stockholders (orphans, widows and your retirement account) lose everything, and the employees are all fired, which is kind of a tax, too, and all the millions of the people who pay these higher prices for the devices have to turn around and charge more money for their goods and services to try and break even, which means more inflation in prices and a shrinkage of the economy unless the Federal Reserve creates more money and credit, which they invariably do, which makes inflation in prices worse and worse in some horrifying dance of inflationary economic death, and which makes it so easy to predict that We're Freaking Doomed (WFD)!" And, speaking of WFD, I note with a trembling horror in my voice and my heart pounding, pounding, pounding in my ears that the latest Consumer Installment Debt figures for October jumped up by a massive $14 billion, bringing the total to of this huge, strangling, staggering $2.753 trillion, which is -- unbelievably! -- higher than the $2.6 trillion in Consumer Installment Debt at its "height" in 2008! To be sure, that $2.6 trillion record-setting debt set in 2008 dropped over the next few years by a couple of hundred billion dollars as people cut gradually paid off some of their debt. But now! Now, in the last couple of years, despite rising unemployment, rising bankruptcy, stagnant wages and an economy that is at death's door because the evil Federal Reserve created so irresponsibly much money and credit for the last three decades, people are again borrowing money with the greedy, reckless, mindless abandon of old, and have astonishingly gone another $300 billion deeper in consumer debt in the Last Freaking Year (LFY) alone! A short twelve months! $300 billion in the LFY! That's $2,000 more personal debt for every adult in the Whole Freaking Country (WFC)!! Like most of you, even the exciting use of two exclamation points cannot penetrate my shocked numbness from the steady drumbeat of disturbingly, terrifyingly higher and higher prices, and a higher and higher money supply, and higher and higher debts, both cash-basis and accrued. Fortunately, this shell-shocked attitude is not universal, and Ed Steer of the eponymous Ed Steer's Gold & Silver Daily newsletter reports that Stephen King (if that is his real name!), and who is supposedly chief economist at HSBC Holdings Plc in London and a former U.K. Treasury official, said "There are lots of things central banks are worried about at the moment, and inflation is not the highest priority. As long as people believe central banks are committed over the longer term to price stability, there is leeway to play around with other objectives." A high-decibel Mogambo Scream Of Outrage (MSOO) was literally in my throat when I was stopped the humor of Ed's reply. I envision an arched eyebrow, curled lip and contemptuous sneer to accompany his understated "Such as???" According to the Mogambo Rules Of Punctuation For Economics Stuff (MROPFES), the use of three -- three! -- question marks indicates extreme stunned incredulity mixed with anger and shock, as seems apropos to the very idea of a central bank not being foremost concerned with inflation in prices above all other concerns. ALL! Well, the answer to Ed's question "such as?" is, of course, that the central banks are committing yet another monetary sin, artificially holding interest rates down to near zero by creating mountains of new money and credit with which to buy up bonds (driving their prices up and their yields down) at the rate of almost $200 billion per month (about $90 billion mortgage bonds and, recently announced, other bonds, which, I assume, is on top of the $100 billion a month in new Treasury bonds that have to be sold to finance a $1.2 trillion federal budget deficit). That's $2.4 trillion a year in new money! Gaaahhhh! You can see how I am on the verge of working myself into a screaming fit of fearful outrage, and how I could go on for hours and hours about the evil Federal Reserve, predictably ending with me telling you, with a voice rising hysterically in volume and timbre, to feverishly buy gold bullion, silver bullion, and oil stocks, because such absolute, suicidal idiocy like that is, I am chilled to say, running rampant, and thus We're Freaking Doomed (WFD)! Rather than be drawn into one of my sick little melodramas, Ed wittily and pithily goes on, while expressing the exact same anger and outrage as found in any of my wild incoherent tirades packed with profanity and vague death threats, with a subtle "I can't believe he said that! Be very afraid." Be very afraid, indeed. He correctly said that. Buy gold, silver and oil. I correctly said that.   |
| We Are Headed To A Historic Collapse Of The Financial System Posted: 16 Dec 2012 02:30 PM PST  Today 40-year veteran, Robert Fitzwilson, wrote the following piece exclusively for King World News. Fitzwilson, who is founder of The Portola Group, discusses the path we are on whcich lead to an unprecedented failure of the current monetarty system. This posting includes an audio/video/photo media file: Download Now |
| JP Morgan Admits That "QE Will Offset Almost All Of Next Year’s Government Deficit" Posted: 16 Dec 2012 01:40 PM PST There was a time when it was nothing short of economic blasphemy and statist apostasy to suggest three things: i) that the Fed's canonic approach to monetary policy, in which Stock not Flow was dominant, is wrong (as we alleged, among many other places, here); ii) that the Fed is monetizing the deficit, thus enabling politicians to conceive any idiotic fiscal policy: the Fed will always fund it no matter how ludicrous, converting the Fed effectively into a political power and destroying any myth of its "independence" (as we alleged, among many other places, most recently here in direct refutation of Bernanke's sworn testimony); and iii) that by overfunding bank reserves, the same banks are left with one simple trade - to frontrum the Fed in its monetization of the long-end, in the process destroying the bond curve's relevance as an inflationary discounting signal, with more QE, leading to tighter 10s, flatter 10s30s, even as the propensity for runaway inflation down the road soars, in the process eliminating any need for the massively overhyped, and much needed to rekindle animal spirits "rotation out of bonds and into stocks" trade (as we explained, first, here). Well, that time is now officially over, with that stalwart of statist thinking, JPMorgan, adopting all of the above contrarian views as its own, and admitting that once again, the Fed and conventional wisdom was wrong, and fringe bloggers were right all along. And while we recreate the piece in its entirety below, here is the punchline:
Who knew that in the internal JPM thesaurus, "offset" was equivalent to "monetize"... But we'll take it. From JPM's Nikolaos Panigirtzoglou: Flows & Liquidity: QE's Stock Effect
* * * Are these the first rumblings of mutiny on the Titanic, we hear? |
| Smashing The Big Banks: Only The First Step Posted: 16 Dec 2012 01:12 PM PST It was encouraging to see a recent article in the N.Y. Times arguing for the necessity of smashing the Big Bank Oligopoly in the U.S. Apparently not everyone has forgotten the basic fundamentals of economics. Going all the way back to Adam Smith; all the economic theorists have acknowledged a central premise of capitalism: oligopolies (and/or monopolies) are predatory, parasitic abominations which can never be allowed to evolve in our economies. Or, as I put more succinctly in a previous commentary, "too big to fail = too big to exist." This premise is so self-evident that it should not even require elaboration. Yet the fact that these Vampire Banks not only exist but continue to grow shows that this simple truth is still not grasped by more than a small fraction of the population. What is "too big to fail"? It is a group of (arrogant) Banking Oligarchs saying to the U.S. government (and governments across the West): "we're so important that you must save us…or else." This is extortion. It cost U.S. taxpayers somewhere in the neighbourhood of $15 trillion in assorted hand-outs, 0% "loans", and "guarantees" when Wall Street made its extortion demands in 2008. Since that time, the U.S. economy is much weaker, much more debt-leveraged (i.e. insolvent); and the Wall Street Vampires have been allowed to get even bigger. The result? Serial extortion – in the form of the latest "QE" from the Federal Reserve: $500 billion per year in blackmail payments, ad infinitum. Purchasing the worst financial feces from the Wall Street Vampires, and taking this directly out of the pockets of ordinary Americans (via currency dilution). Incredibly, the Sheep still don't understand even this bankster crime of theft-in-broad-daylight, so perhaps a simple example will illustrate it. Seven Castaways are stranded on a desert isle. Even though they only have one "good" to purchase in their economy (coconuts); one of the Castaways happened to bring along a printing press, and so they decide to have their own money. Ten Coconut Dollars are printed for each Castaway per month. Suddenly, one month one of the Castaways (let's call him "Gilligan") gets a brilliant idea as to how "they can all get rich": print more money. Instead of printing only ten Coconut Dollars per Castaway each month they would print one thousand Coconut Dollars. So even if they never got rescued, they would soon all be "rich." Lacking any "Professor" to explain the folly of Gilligan's plan, they all agree. However, what the Castaways quickly discover is that none of them are getting any wealthier at all. With their tiny island economy flooded with Coconut Dollars (one hundred times more), all that has happened is that prices also increased by a factor of one hundred. Now let's change our scenario slightly, and introduce a new Castaway: "Banker." Banker happens to be the owner of the printing press, and Banker gets a different idea for "getting wealthy." With complete control over the printing press, Banker decides that from now on while each of the other Castaways will continue to get ten Coconut Dollars each month that he will receive one thousand Coconut Dollars monthly. Suddenly the dynamics change dramatically. Instead of our first example, where no one got any wealthier as price increases (naturally) matched the increase in the money supply; we have a much different scenario. Banker becomes wealthier and wealthier, as he continually gets a massive, new supply of Coconut Dollars. |
| SILVER Window of Opportunity @ $29.68 – $26.23 by Jan 18 2013? Posted: 16 Dec 2012 01:11 PM PST The following is a quick update to our Silver Lining report from October 21, 2012. The daily chart below illustrates the latest price action in Silver. From the secondary lower high at $34.39, the trend has been down for the past 11-sessions, setting a print low on Friday at $32.22. As such, Tuesday marks session-13 from that secondary high, and offers the potential for marking a short-term turn-pivot low. |
| Owning Gold Bullion Can Help Boost Your Global Net Worth! Here?s Why Posted: 16 Dec 2012 11:12 AM PST Today’s* world is as uncertain as any we’ve seen in some time. Sovereign-debt crises threaten* major economies in Europe and Japan and the fiscal state of the United States* is the worst in non-wartime history! It’s* no surprise, then, that investors are becoming increasingly attracted to the* safety, anonymity and purchasing-power preservation that comes with bullion* ownership. That being said, one of the most-often-overlooked benefits of bullion is its ability to help you* increase your wealth across currencies, so today I’ll show you how owning* physical metals — and the most-precious of them all, gold in particular — can*help you to boost your global net worth! Words: 896 So says Tom Essaye ([url]www.moneyandmarkets.com)*[/url]in edited excerpts from his original article* entitled Your ONLY Protection from the Coming Currency Wars. [INDENT]*Lorimer Wilson, editor of [COLOR=#0000ff][COLOR=#ff0000]www.FinancialArticleSummariesToday.com[/COLOR] (A site for s... |
| Posted: 16 Dec 2012 11:01 AM PST Nothing has changed: Precious Metals bull market continues and is moving step by step closer to the final parabolic phase (could start in 2013 and last for 2-3 years or maybe later) ... Read More...  |
| Market Report: Gold Vs Gold Stocks ($HUI) Who is Leading Who? Posted: 16 Dec 2012 08:11 AM PST The Gold stocks have failed to deliver on my expectations of a move higher and it has caused me to re-think the direction of the yellow metal. Read More...  |
| Palladium – The New “Gold”? Posted: 16 Dec 2012 06:44 AM PST You all know by now that there's a huge battle going on in Palladium… The battle of $700. No, what I will tell you now, is something that could be even more promising for palladium going forward… Recently, Gold and Silver have been weak, to say the least. Palladium on the other hand, has been surging non-stop since the end of October, from below $600 to $700 at the moment. Palladium has outperformed Gold recently. This can be seen in the weekly chart below, which plots the Palladium price divided by the Gold price. A rising ratio means Palladium outperforms Gold. We can see that the ratio recently broke out above the red resistance line, meaning the downtrend has stopped. When we then look at the Monthly chart, we can also see a breakout above the red resistance line, just like in 1996-1997… Since we now have a breakout on both the weekly and Monthly charts, this could imply that a new uptrend has begun. I even think there is a distinct possibility that we will see the ratio go up to 1.00 over the next couple of months… Do the math… Once the "big players" notice the fact that Palladium will likely outperform Gold, the market (price) will take care of the rest… |
| Our Path To Collapse Will Impact Everyone Around The World Posted: 15 Dec 2012 03:06 PM PST  On the heels of continued volatility in global markets, today acclaimed trader Dan Norcini spoke with King World News about the path to collapse which the West has chosen, what it means, and how it will impact every KWN reader around the world.This posting includes an audio/video/photo media file: Download Now |
What in the world is happening to America? I have written many articles about how 
THE mother of the loner who massacred 26 pupils and staff at a US primary school may have played a major part in his catastrophic mental breakdown, it emerged last night.
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