Monday, November 30, 2009

Run on The U.S. Dollar SOON!


Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?

How did we end up with so much short-term debt? Like most entities that have far too much debt – whether subprime borrowers, GM, Fannie, or GE – the U.S. Treasury has tried to minimize its interest burden by borrowing for short durations and then "rolling over" the loans when they come due. As they say on Wall Street, "a rolling debt collects no moss."

What they mean is, as long as you can extend the debt, you have no problem. Unfortunately, that leads folks to take on ever greater amounts of debt... at ever shorter durations... at ever lower interest rates. Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that's when the trouble starts. Interest rates go up dramatically. Funding costs soar. The party is over. Bankruptcy is next.

When governments go bankrupt, it's called a "default." Currency speculators figured out how to accurately predict when a country would default. Two well-known economists – Alan Greenspan and Pablo Guidotti – published the secret formula in a 1999 academic paper. The formula is called the Greenspan-Guidotti rule.

The rule states: To avoid a default, countries should maintain hard currency reserves equal to at least 100% of their short-term foreign debt maturities. The world's largest money-management firm, PIMCO, explains the rule this way: "The minimum benchmark of reserves equal to at least 100% of short-term external debt is known as the Greenspan-Guidotti rule. Greenspan-Guidotti is perhaps the single concept of reserve adequacy that has the most adherents and empirical support."

The principle behind the rule is simple. If you can't pay off all of your foreign debts in the next 12 months, you're a terrible credit risk. Speculators are going to target your bonds and your currency, making it impossible to refinance your debts. A default is assured.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Dubai says Dubai World is on its own


DUBAI, United Arab Emirates - The Dubai government disclaimed responsibility for the debts of Dubai World on Monday, dealing a blow to creditors' assumptions that the Arab emirate would guarantee the conglomerate's liabilities.

"Creditors need to take part of the responsibility for their decision to lend to the companies," said Abdulrahman al-Saleh, director general of Dubai's department of finance. "They think Dubai World is part of the government, which is not correct."

United Arab Emirates stocks plunged on Monday as investors waited for clarity on Dubai's request for a delay until May 2010 on repaying billions of dollars in debt issued by Dubai World and its Nakheel unit, developer of three distinctive palm-shaped islands in the emirate.
LINK HERE

Bernie Sanders Exposes Bernankes Crimes

NACA Meeting: 45,000 Desperate Homeowners Show Up


(Snippet)
The turnout was staggering: close to 45,000 desperate homeowners showed up during NACA's five-day stand at the Cow Palace for the chance to renegotiate their disastrous subprime mortgages or sky-high interest rates or interest-only payments. For them, this event beat any chance at a star-studded concert -- and best of all, it was free.

Inside, homeowners received housing-related financial advice and met with NACA’s counselors, a stoic crew, always with coffee or energy drinks in hand and clad in red and yellow T-shirts with STOP LOAN SHARKS and SHARKS BEWARE emblazoned on their backs. Here, homeowners could have their income, taxes, and spending habits analyzed, and possibly walk away with a monthly mortgage payment that actually fit their situations. With that payment figure in hand, homeowners could then meet with representatives from their mortgage companies in the same arena and try to hammer out new terms on more affordable mortgages.

The process would save many of them thousands of dollars, defuse an explosive mortgage, even avert foreclosure. To boost morale, NACA officials occasionally ushered chosen homeowners to a makeshift lectern where each offered a glowing testimonial over a PA system to the work taking place. They spoke fervently of new fixed-interest loans and fought back tears, while thanking their counselors, friends, NACA, and -- regularly -- God.
LINK HERE

Insured But Not Covered
As if the lousy economy hasn't done enough damage, here's another thing to worry about: more people driving without automobile insurance.
LINK HERE

FDIC too broke to Takeover Banks?


The Federal Deposit Insurance Corporation (FDIC) was hammered this week when a third quarter report demonstrated that the FDIC was running in the red to the sum of $8.2 billion. This is troubling since the FDIC protects deposits in member banks up to $250,000 and funds covered by the deposit insurance fund (DIF) are over $5.3 trillion, this amount is over one-third of our nationwide GDP. The FDIC as of Q1 of 2009 has 5,381 employees. Is that enough to deal with the enormous banking crisis?
The FDIC is proud of saying that since 1934 no depositor has ever lost a single cent of insured funds due to any bank failure. Yet what isn’t stated is the trillions needed to prop up the failing banking system. Of course, as time has gone on and the banking system has gotten more fragile the amount of insured deposits has ramped up:
1934 – $2,500
1935 – $5,000
1950 – $10,000
1966 – $15,000
1969 – $20,000
1974 – $40,000
1980 – $100,000
2008 – $250,000
Did you notice how no banks were taken over this week? This definitely bucks the overall trend for the year:
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Increasing Number of Economic Experts: The US Is Going to Collapse


(snippet)
For the smaller countries, the financial losses arising from this crisis are a great deal larger in relation to their gross domestic product than they are for the United States. Yet the stakes are higher in the American case. In the great scheme of things—let's be frank—it does not matter much if Iceland teeters on the brink of fiscal collapse, or Ireland, for that matter. The locals suffer, but the world goes on much as usual.
But if the United States succumbs to a fiscal crisis, as an increasing number of economic experts fear it may, then the entire balance of global economic power could shift. Military experts talk as if the president's decision about whether to send an additional 40,000 troops to Afghanistan is a make-or-break moment. In reality, his indecision about the deficit could matter much more for the country's long-term national security. Call the United States what you like—superpower, hegemon, or empire—but its ability to manage its finances is closely tied to its ability to remain the predominant global military power. Here's why.

The disciples of John Maynard Keynes argue that increasing the federal debt by roughly a third was necessary to avoid Depression 2.0. Well, maybe, though some would say the benefits of fiscal stimulus have been oversold and that the magic multiplier (which is supposed to transform $1 of government spending into a lot more than $1 of aggregate demand) is trivially small.


Credit where it's due. The positive number for third-quarter growth in the United States would have been a lot lower without government spending. Between half and two thirds of the real increase in gross domestic product was attributable to government programs, especially the Cash for Clunkers scheme and the subsidy to first-time home buyers. But we are still a very long way from a self--sustaining recovery
LINK HERE

Sunday, November 29, 2009

Retailers in Big Trouble: Nobody Spending on Black Friday


American consumers shopped more for bargains at the start of the U.S. holiday season and spent significantly less than a year ago, according to early data released on Sunday.

Consumers said they will have spent nearly 8 percent less on average, or about $343 per person, over the weekend that includes U.S. Thanksgiving Day, Black Friday and runs through Sunday, according to the National Retail Federation.

While traffic to stores and retail websites rose to 195 million people from 172 million in 2008, the early data this weekend represents a worrisome sign for retailers, who had braced for weak sales and sought ways to protect margins.

Data released by ShopperTrak on Saturday showed that sales rose a scant 0.5 percent on Black Friday, which is often the single busiest day of the holiday shopping season.
LINK HERE

George Carlin on The Government and Education Rated R

Potential For Fed To Hyperinflate


The following information may be the most important we have ever published. One of our Intel sources, highly placed in banking circles, tells us that on 1/1/10 all banks that have received TARP funds have been informed by the Federal Reserve that they must further restrict any commercial lending. Loans have to be 75% collateralized, 50% of which has to be in cash, which is a compensating balance.
The Fed has to do one of two things: They either have to pull $1.5 trillion out of the system by June, which would collapse the economy, or face hyperinflation. This is why the Fed has instructed banks to inform them when and how much of the TARP funds they can return. At best they can expect $300 to $400 billion plus the $200 billion the Fed already has in hand.
We believe the Fed will opt for letting the system run into hyperinflation. All signs tell us they cannot risk allowing the undertow of deflation to take over the economy. The system cannot stand such a withdrawal of funds. They also must depend on assistance from Congress in supplying a second stimulus plan. That would probably be $400 to $800 billion. A lack of such funding would send the economy and the stock market into a tailspin. Even with such funding the economy cannot expect any growth to speak of and at best a sideways movement for perhaps a year.
We have been told that the FDIC not only is $8.2 billion in the hole, but they have secretly borrowed an additional $80 billion from the Treasury. We have also been told that the FDIC is lying about the banks in trouble. The number in eminent danger are not 552, but a massive 2,035. The cost of bailing these banks out would be $800 billion to $1 trillion. That means 2,500 could be closed in 2010. Now get this, the FDIC is going to be collapsed before the end of 2010, which means no more deposit insurance. This follows the 9/18/09 end of government guarantees on money market funds. Both will force deposits into US government bonds and agency bonds in an attempt to save the system.
LINK HERE

Martin Armstong – Forced to Move to a High Security Prison to Silence Him?


Frankly, I cannot believe that I have to write the words that follow. I just learned that Martin Armstrong is being moved, possibly as early as Monday, from his current holding facility to a much higher security facility, MDC Brooklyn, which is similar to the facility he was in when he was in solitary confinement and where he was beaten nearly to death! This goes against the prison’s own rules and is against the law as he has two Habeas cases open in the Supreme Court.

Why would this be happening now with a little more than a year before he is eligible for parole? I and others contend that it is because of his recent writing activity and because of his recent interview with the New Yorker Magazine (- The New Yorker - "The Secret Cycle…"), and also because there are now several media outlets requesting to do interviews with him – the prison simply does not want, for whatever reason, the access that we have been enjoying lately to continue. I spoke directly to Martin’s younger sister, Nancy, and this is her opinion as well. She is very upset over this move as she, “fears that he may not make it out.” She claims that Martin is very much afraid of this move and for good reason…

First let’s review the facts… whatever you believe about his innocence or guilt or innocence of any crime, the facts are that he was never put on trial for any crime. He was held in contempt of court for not producing what the judge ordered him to produce, something which he claims he didn’t have. He was placed in MDC Manhattan and was basically TORTURED. According to Nancy, he was locked in solitary confinement for almost the entire duration, suffering days on end and at times was intentionally awaken every hour or so all night long, night after night, in an attempt to get him to sign a confession. He was repeatedly told that he would not get the chance to see his 91 year old mother alive again if he did not sign the confession. This took place off and on for SEVEN YEARS. Then one day a huge convict, “a known homicidal maniac” named George, was locked in his cell with him where he proceeded to beat and strangle him until he thought he was dead. Later, according to Armstrong, a fellow inmate stated that the guards watched the beating and refused to open the door to stop it. He lost most of his teeth, and now, over two years later is still missing them because the prison system only has one dentist for over 5,000 inmates. He suffered a detached retina, broken ribs and other internal injuries that left him in intensive care.
LINK HERE

Saturday, November 28, 2009

Shocking: High School Grads Twice As Likely To Be Jobless Than College Grads


The economic meltdown has hit non-college grads much harder than the educated. And conservatives are very good at exploiting their anger and unease. Tools
You know how bad the economy is, right? Maybe your 401(k) has tanked. Perhaps you were out of work for a few months. You could have a mortgage under water. Or your health insurance has an impossibly high deductible. Yeah, we're all singing the blues.

I've gotten out my violin to play a mournful accompaniment to our collective angst.

Wait, what's that I hear in the distance? A dissonant, thundering chord someone just hammered on the piano -- a harsh interruption of my languid dirge. Now it repeats, getting louder and nearer.

It's the sound of rage, of people I don't know -- millions of them -- unable to make rent or feed their families. Why don't I know them? They don't have college degrees, and nearly everybody I know does.

The truth is, brothers and sisters, however much we the degreed are suffering, we don't know the half of it. And unless we familiarize ourselves with the other half very, very soon, what was supposed to be a new progressive era could quickly give way to the rage of the Tea Party.
LINK HERE

Kondratieff Winter: Depression Until 2020?


*The following lays out the sequence of the events following the 1929 stock market crash.

Phase 1
"A flight from questionable securities into strong securities." This occurred during the initial stock market crash in 1929. The stock market recovered 50% of its losses into April 1930. Then as the bear market resumed, all securities, except for the gold shares, were sold regardless of quality. Following the stock market peak in October 2007, this flight from questionable securities into strong securities gathered momentum into November 2008. Following a probable stock market partial recovery into April 2009, all securities, except for gold shares, will likely be sold, as the bear market resumes with a vengeance.

Phase 2
"An intense liquidation of inventories and commodities" Then, 1930-1933; now, starting in July 2008 and continuing into a deflationary bottom, perhaps by 2012.

Phase 3
"The liquidation of commercial real estate, houses and farms, both through foreclosures and sacrifice sales at a fraction of prior values." Then-1930-1939; now, houses-starting in July 2007; commercial real estate just beginning; and farms to follow.

Phase 4
"The flight from banks into cash and gold (which ultimately caused the whole US banking system to collapse.)"-Then-1930-1933; now, mid-2008, perhaps until mid-2009; by which time US T-Bills are likely to become suspect monetary investments, which would make gold the ultimate store of value.

Phase 5
"The flight from the dollar to gold."-Then, October 1931-March 1933. In 1933, President Roosevelt stopped the flight to gold by suspending gold convertibility for the dollar and confiscating all privately held gold. Thereafter, the only way Americans could own gold was by investing in gold company shares. Nevertheless, the value of Homestake Mining shares had already tripled prior to the confiscation. This 5th stage is still pending, awaiting the demise of the dollar.


The Long Depression will last until 2020

Kondratieff Cycle-Side Bar

Bob Chapman (Video): This is Very Serious



Bloomberg Reporter who Sued the Fed has Died
Mark Pittman, the award-winning investigative reporter whose fight to open the Federal Reserve to more scrutiny led Bloomberg News to sue the central bank and win, died Nov. 25 in Yonkers, New York. He was 52.
LINK HERE

Politicians Don't Want Public to Know: Britain Faces Financial Armageddon

A year ago, the world reacted with astonishment as Iceland technically went bust. It seemed inconceivable that a modern democratic nation could have such parlous finances that only an emergency $6billion bail-out from the International Monetary Fund enabled its economy to keep functioning.
This week, we witnessed a similar crisis in the Middle East but on a far, far more dangerous scale, as Dubai effectively defaulted on £48billion of loans.
Unless its more prudent and oil-rich neighbour, Abu Dhabi, launches a rescue plan then Dubai - once a gilded monument to financial success - will effectively be insolvent.
(snippets)
Which leads us to a haunting question: as the country in the world hardest hit by the credit crunch, with gross domestic product (GDP) projected to decline by almost five per cent in 2009, could Britain be next?
Let's think the unthinkable for a moment. These are the facts.
Even before the financial crisis, the British Government spent roughly £30billion more per year than it earned in tax revenues. This money, of course, had to be borrowed from international investors.
Today, the Government needs up to £200billion a year for at least the next three years in order to meet its spending commitments. But the Government's estimates invariably understate its true need, and they have to be continually revised upwards.
Before the crunch, total government debt stood at roughly 40 per cent of GDP. It is now around 60 per cent of GDP, but is projected to soar close to 100 per cent in the next few years. But again, that is not the full story.

The news is potentially so bad that politicians simply don't want the general public to know what's going on.
Given the scale of the crisis, what then do they propose? New Labour is non-committal, suggesting that cuts will be prudent, thoughtful and spare people's worst pain. The Conservatives have targeted around £7billion of spending cuts, but these won't happen immediately and are nothing like enough to rebalance the nation's books.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Economic Crisis in Eastern Europe Deepens


(snippet)
The International Monetary Fund has also issued a number of blunt warnings about developments in eastern Europe. The Austrian Standard quotes IMF economist Christoph Rosenberg, who declares that the recent recovery of financial markets in the region is almost exclusively due to the increased appetite for risk on the part of investors and has little to do with any improvements in the real economy. Rosenberg warns of a new stock market bubble, which will have dire consequences when it collapses.
Rosenberg was not prepared to commit himself when asked if conditions would improve for eastern European markets. “We can only do what we did prior to the economic crisis—warn of the dangers,” he said.
However, when one examines the state of economic conditions, one can only conclude that it is already too late for warnings. The situation is most dire in the Baltic states. In Latvia, bankers are speaking of a “dramatic development.” Despite draconian austerity measures by the government, the country is moving ever closer to bankruptcy.
The rates for credit default swaps, which reflect the perceived risk of state bankruptcy, currently lie between 500 and 600 points for the Baltic states. In comparison, the rate for credit default swaps for Austria is around 60 points.
LINK HERE

Friday, November 27, 2009

The Economic Crisis and What Must be Done


The United States does not control its own destiny. Rather it is controlled by an international financial elite, of which the American branch works out of big New York banks like J.P. Morgan Chase, Wall Street investment firms such as Goldman Sachs, and the Federal Reserve System. They in turn control the White House, Congress, the military, the mass media, the intelligence agencies, both political parties, the universities, etc. No one can rise to the top in any of these institutions without the elite’s stamp of approval.

This elite has been around since the nation began, becoming increasingly dominant as the 19thcentury progressed. A key date was passage of the National Banking Act of 1863, when the system was put into place whereby federal government debt was used to collateralize bank lending. Since then we’ve paid the freight through our taxes for bank control of the economy. The final nails in the coffin came with the passage of the Federal Reserve Act of 1913.

In 1929 the bankers plunged the nation into the Great Depression by constricting the money supply. With Franklin D. Roosevelt as president, the nation struggled through the decade of the 1930s but did not pull out of the Depression until the industrial explosion during World War II.

After the war came the Golden Age of the U.S. economy, when the working man, protected by strong labor unions, became a true partner in the prosperity of the industrial age. That era lasted a full generation. The bankers were largely spectators as Americans led the world in exports, standard of living, science and space exploration, and every measure of health, longevity, and culture.

Roosevelt had kept the bankers subservient to the interests of the economy at large. The Federal Reserve was part of the New Deal team, and interest rates were held at historic lows despite a large federal deficit. One main impact was the huge increase in home ownership. After World War II, the G.I. Bill allowed home ownership to grow further and millions of veterans to attend college. The influx of educated graduates led to productivity growth and the emergence of new high-tech industries.
LINK HERE

Value Added Tax Coming: US Will Have to Tax Consumers


The U.S. will need to eventually enact national value added tax in order to raise revenue and decrease its deficit, Paul Donovan, MD & deputy head of global economics at UBS, said Thursday.

"The United States is the only OECD without a national value-added tax. And I think they are going to have to go down that route at some point," Donovan told CNBC.

"It's a cheap way of raising money. It is a very effective way of raising money. It is not a very equitable way of raising money — it falls disproportionately on lower income groups. So you may have to make some other changes to the tax code to try and compensate for that. But that is actually going to be a good way of raising money," he said.
LINK HERE

Big US banks may be forced to raise more capital soon: Analyst
Most big US banks may be forced to make public offerings soon if the Treasury demands payback of the funds it issued under the Troubled Assets
Relief Program, veteran banking analyst Richard Bove said.
LINK HERE

Biden Is Right: Obama Administration Is Our Worst Nightmare



Vice President Joe Biden issued a somber warning for opponents of the Obama administration's agenda, telling party loyalists during a fundraising speech in Iowa that the naysayers "should be worried about us, for we are their worst nightmare." Duh.

Finally we can agree on something, Joe. Even the liberal New York Times reports that, at the current level of federal spending, the annual interest on the national debt will exceed $700 billion by 2019 — compared with $202 billion this year. Some forecasters predict it will be much higher. This additional half-trillion dollars a year in interest is more than our combined expenditures on education, energy, homeland security, and the wars in Afghanistan and Iraq.

Oh, and the Times isn't even factoring in the cap-and-trade nightmare you and Barack have in store for us, Joe — you know, that urgent legislation to catapult the nation back into Third World status based on hysteria generated by fraudulent science and corrupt zealots and politicians.

Nor is the Times including in its calculations the additional debt that would result from Obamacare.

Joe, when The New York Times is sounding the alarm over the exploding national debt, you and Barack Obama insist not only on not reversing your disastrous course but also on making it worse. How can reasonable people assume anything other than that you are trying to run this nation into the ground financially?
LINK HERE

IRS files $79,000 tax lien against Schwarzenegger
A federal tax lien would be attached to all of the governor’s properties, according to the IRS.
LINK HERE

Warning: Major Sovereign Default Possible


(Bloomberg) -- Dubai’s debt woes may worsen to become a “major sovereign default” that roils developing nations and cuts off capital flows to emerging markets, Bank of America Corp. said.

“One cannot rule out -- as a tail risk -- a case where this would escalate into a major sovereign default problem, which would then resonate across global emerging markets in the same way that Argentina did in the early 2000s or Russia in the late 1990s,” Bank of America strategists Benoit Anne and Daniel Tenengauzer wrote in a report.

A default would lead to a “sudden stop of capital flows into emerging markets” and be a “major step back” in the recovery from the global financial crisis,’’ they wrote.


CITIBANK USED BAILOUT MONEY FOR DUBAI
The US public will be “outraged” by Citibank’s $8 billion loan to Dubai just six weeks after the bank was bailed out, US House of Representatives domestic policy subcommittee chair-man has said. Dennis Kucinich commented on the Dubai loan and other US banking investments as a congressional panel released a report that strongly questioned Citibank’s actions. The report, shown to 7DAYS, cites the Dubai loan as the largest of the “questionable transactions” by banks after the US government bailed them out. It notes that the loan to Dubai’s public sector came on December 14, just six weeks after the US government gave Citibank a $25 billion bail-out.
LINK HERE

DUBAI DEBT IS 184 BILLION
LONDON: The United Arab Emirate (UAE) has total debt amounting to $184 billion at the end of 2009, according to estimates by Bank of America-Merrill Lynch.
LINK HERE

Thursday, November 26, 2009

Parties Being Held in Vacant Houses All Over U.S.


SANDY SPRINGS, Ga. — Some of the most elegant addresses in all of Atlanta are found in this wealthy enclave. Sprawling mansions that occupy 2- to 10-acre lots are home to some of the city's most prominent residents.
They were shocked last month when a massive Halloween party exploded in their midst. More than 1,000 people jammed the streets around the brick-and-rock mansion, paying $20 apiece for admission and riding shuttle buses from the parking lot of a nearby Publix grocery, police say.

"It was one of those things, be careful what you wish for," says Sandy Springs police Lt. Steve Rose. "(The event promoter) got a lot more than he expected. It became a gridlock issue with traffic."

Police say the party had been heavily promoted at Georgia State University in Atlanta and at the University of West Georgia in Carrollton. Food and alcohol were being sold inside the six-bedroom mansion.

"It was unbelievable," says neighbor Kathy Battaglia, a user-support analyst for an accounting software firm. "The noise over there was so loud it may as well have been in our house. It sounded like the whole party was in the front yard and on the front porch."
LINK HERE

Case-Shiller Still Predicts Massive 45% Fall from Today’s Values


The 10 major cities in the Standard & Poor's/Case-Shiller home price index have risen 5% from their April low, but the index is still predicting a massive 45% fall from today’s values.
Tuesday's new number from the index showed a gain of just under .5% for the month of September, but the index remains 30% below the high in June 2006. Based upon a trend generated from the actual prices of 1987 to 1997, and generated forward in a linear projection, the index will fall a total of 62% before it reaches the trend norm.
A more comprehensive analysis of the 10-city index based upon a 120 years of data shows current values off 36% and a comparatively modest 20% fall ahead.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Vietnams Dollar Just Devalued


Nov. 26 (Bloomberg) -- Vietnam’s dong fell to a record low after the central bank devalued the currency to curb quickening inflation and a widening trade deficit. Stocks dropped and headed for the worst week since October 2008.

The State Bank of Vietnam yesterday set the reference rate for today’s trading 5.2 percent lower at 17,961 against the dollar, after the difference between spot and black-market rates widened to the most in a decade. The dong has fallen 5.4 percent this year, set for a second annual decline.

“The central bank is trying to regain control of the foreign-exchange market by stepping up with an aggressive approach to stop the drift in the unofficial market rate,” said Fiachra MacCana, managing director and head of research at Ho Chi Minh City Securities Co.

The dong declined 3.3 percent to 18,488 against the dollar as of 3:41 p.m. in Hanoi, according to data compiled by Bloomberg. It earlier traded as low as 18,500, 3 percent weaker than the reference rate. The central bank yesterday narrowed the daily trading band to 3 percent from 5 percent to limit moves.
LINK HERE

Canada's Real Debt is 2 Trillion or 131% of GDP


An eerie calm fell over Canada’s financial markets one year ago. Battered by collapsing equity markets worldwide, and further hampered by falling commodity prices, the Canadian economy ground to a screeching halt. A decade of growth fueled by expanding debt was about to be unwound. Or so it seemed. However, into the breach stepped the Canadian government with a stimulus program of mammoth proportion. Though dormant in the spring, by the summer we saw a few green shoots emerge. And by the autumn of 2009 we began to harvest debt-fueled growth in this country once again.

This post does not quibble with the growth we see. It is there for all to observe. If we dare to ask a question it is only regarding the less studied subject of the durability of a rebound built on government largesse. Simply put, does the Canadian government have the borrowing capacity to keep on priming the pump?
LINK HERE

Rogers Communications lays off 900 managers
LINK HERE

Dubai: 19 Billion Loss Coming For European Banks Investors in Shock


Note: The Dubai collapse has been mentioned many times on this blog since July 2009, so this is old news. Here AND HERE

LONDON (MarketWatch) -- Analysts at Credit Suisse estimated Thursday that European banks they cover could have exposure of around 13 billion euros ($19.6 billion) to Dubai. The broker said a 50% loss on the exposure would be equivalent to around a 5% increase in provisions in 2010 or a hit of around 5 billion euros after tax for the European banking sector as a whole. Analysts cautioned that the numbers are difficult to quantify and exposures will differ from one bank to another.
LINK HERE

Investors in Shock
LINK HERE

Faber: War Against an Imaginary Enemy and a Big Financial Bust


(snippet)
Faber (Article Here): There will be another war and it will be against an imaginary enemy
Mish: I certainly agree the next war will be against an imaginary enemy. Nearly every war is against an imaginary enemy and/or of no vital interest of the US. WWI, Korea, Vietnam, and Gulf War II were all needless. WWII was a direct result of WWI. The "War on Terror" is preposterous. Terror is a method. Waging a war on a method against an enemy that has no real country is bound to fail and waste a lot of money in failure. As for where next, given Obama's sabre rattling against Pakistan, that is one place to keep an eye on. Iran is another.

Faber: The S&P 500 and the Dow Jones will go down relative to gold.
Mish: I concur. The question is in what way. The key word in the above sentence is "relative". Gold can easily stay flat, rise, or drop while the bottom falls out of the S&P.

Faber: Eventually there will be a big bust and then the whole credit expansion will come to an end. Before that happens, governments will continue printing money which in time will lead to a very high inflation rate, and the economy will not respond to stimulus.
Mish: The economy is not responding to stimulus right now, at least in any meaningful way. 100% of the GDP growth was directly related to government stimulus. The idea that government spending can start a genuine economic recovery is ridiculous. Nonetheless, government spending can start an artificial boom. The housing bubble is an example of an artificial boom. However, for a boom to start, individuals and businesses have to be willing to go along. That is the way it works in a credit based economy. Right now personal credit is contracting, credit card lending is falling, and businesses simply do not want to expand in the face of tax increases and high unemployment. Unless and until the Fed reignites another credit boom, high inflation is unlikely. The fear now should be more of what Congress does than what the Fed does. Yet it seems Congress is getting a bit leery over these huge deficits. Congress will spend of course, but will it be enough to matter much? I doubt it, at least until we have more purging of consumer and corporate debt via bankruptcy.

Faber: US government will increase its stimulus spending should the Standard & Poor’s 500 Index fall toward 900.
Mish: Agreed but it will not help for reasons stated above.

Faber: The S&P will not drop below 800 or 900, and eventually will go higher in nominal terms, but not necessary in real terms. A correction is coming in the near term.
Mish: I doubt the bottom is in, but it could be. If it is in, then I expect a retest closer to 700 than 900. It is conceivable the S&P drops to 500, which by the way I think is fair value. Japan had two lost decades and I expect the US will have them as well.

Faber: The capitalistic system 'as we know it today' will collapse.
LINK HERE

Wednesday, November 25, 2009

Staggering 1 in 4 Borrowers Underwater


Note: It was reported a few months ago it was 1 in 8.
Wall Street Journal report says situation may threaten the housing recovery.
WASHINGTON - Nearly one in four U.S. borrowers owe more on their mortgage than their home is worth, a worrisome sign that the housing recovery could be threatened by a wave of defaults, the Wall Street Journal reported on Tuesday.

The newspaper said almost 10.7 million households, or 23 percent of mortgage holders, were underwater in the third quarter, and 5.3 million have mortgages that are 20 percent higher than the value of their home as prices have plummeted since the recession began.

The report cited a survey by First American CoreLogic, a Santa Ana, Calif.-based real estate information company, which said more than 520,000 of the borrowers have received a default notice.
LINK HERE

Dubai to Default on 80 Billion Dollar Debt?


Note: this has been translated
Debts overwhelm Dubai.

Dated : 25 November 2009 19:19
Last modified: 25 November 2009 20:29

DUBAI - the Arab emirate Dubai is struggling with enormous financial problems. As a result of the construction frenzy in the previous years debts have grown up to the point that the most important investment corporation of the government wants to delay paying down its debts for the time being.

It concerns Dubai World, the parent company of among others the project developer Nakheel.

Nakheel was among others responsible for the construction of the palm islands off the coast of Dubai. This prestigious country extraction project put the emirate in one go on the world card.

At Dubai World the debt burden amounts to at least 59 billion dollar (39 billion euro). The total debt of Dubai amounts to about 80 billion dollar (53 billion euro).

Banking sector

Refinancing is hampered by the worldwide problems in the banking sector. The economy of Dubai is in the doldrums because the property has been caught up in a downward spiral.

Now Dubai World has asked its creditors to accept delaying payments on its debt for at least six months.

This so-called debt moratorium would have apply up to 30 May next year. In the meantime Dubai with aid of consultancy firm Deloitte wants to reorganise the activities of the state investment company.

Delinquency

Financial markets are already anticipating that Dubai World will fall. The costs to insure debt papers of Dubai against non-payment on its obligations has strongly risen on Wednesday. The prices of their bonds went down strongly.

It is unclear how Dubai will live up to its financial obligations in the coming months. The emirate Wednesday also announced that it has secured 5 billion dollar (3.3 billion euro) with the issue of new bonds which have been placed at two banks from Abu Dhabi.

The two banks which have come to the rescue, National Bank or Abu Dhabi and Hilal bank, are already controlled by the government of Abu Dhabi. This emirate, just like Dubai part of the United arab Emirates, has already financially supported before its neighbouring country.

© DUTCH PRESS AGENCY

Translated Link HERE


Dubai property prices 'fall 41%'
LINK HERE

Miners: We're Running Out Of Gold


MONTREAL — Gold production will continue to fall, despite a brief boost in 2009 and soaring prices, as deposits are exhausted and new discoveries remain elusive, say miners.

In terms of production, "2009 is the outlier as far as the trend," Omar Jabara, spokesman for US-based Newmont Mining, the second-largest gold producer in the world, told AFP.

Overall, "it's a fact that gold production from mines has been in decline since 2001 and has gone roughly from 85 million ounces to about 75 million ounces a year," said Vincent Borg, spokesman for number one producer Barrick Gold.

"It sort of goes down about one million ounces every year and our forecast is that it will continue to decline despite the higher price" for gold nowadays, he said.

Almost everywhere, mineral deposits are being exhausted and new deposits are not being found fast enough to replace them, these experts explain.
LINK HERE

Gold at $2,500 by the end of 2010, and perhaps much sooner- NEW Bob Chapman Article
HERE

The U.S. Mint said Wednesday it will suspend sales of the popular American Eagle 1-ounce bullion coins as rising demand depleted its inventory.
LINK HERE


The International Monetary Fund said Wednesday it had sold 10 tonnes of gold to Sri Lanka's central bank for 375 million dollars, as part of a restructuring of IMF financial resources.
LINK HERE

Retirement Communities Going Bankrupt Throughout The U.S.


The recession is hitting elderly people where they live, literally. Financial problems have been mounting at a number of assisted-living and continuing-care communities, forcing some facilities into bankruptcies and inflicting new worries on residents and their families who thought their life plans were comfortably set. In recent weeks, Erickson Retirement Communities, which manages 19 continuing-care retirement communities in 11 states, declared bankruptcy. Sunrise Senior Living Inc. posted a quarterly loss of $82 million and announced plans to sell off 21 of its assisted-living communities. Nationally, smaller retirement communities are raising their prices, changing the way they operate, selling themselves off to bigger chains, or getting out of the business altogether. Many companies say they can't make a profit—or even succeed on a nonprofit basis—in an environment that combines the high cost of caring for elderly residents, restrictive Medicaid budgets, tight credit markets and fewer residents willing and able to pay top dollar for their care.
LINK HERE

The Bankruptcy of the United States is now Certain


From Porter Stansberry in the S&A Digest:

It's one of those numbers that's so unbelievable you have to actually think about it for a while... Within the next 12 months, the U.S. Treasury will have to refinance $2 trillion in short-term debt. And that's not counting any additional deficit spending, which is estimated to be around $1.5 trillion. Put the two numbers together. Then ask yourself, how in the world can the Treasury borrow $3.5 trillion in only one year? That's an amount equal to nearly 30% of our entire GDP. And we're the world's biggest economy. Where will the money come from?

How did we end up with so much short-term debt? Like most entities that have far too much debt - whether subprime borrowers, GM, Fannie, or GE - the U.S. Treasury has tried to minimize its interest burden by borrowing for short durations and then "rolling over" the loans when they come due. As they say on Wall Street, "a rolling debt collects no moss." What they mean is, as long as you can extend the debt, you have no problem. Unfortunately, that leads folks to take on ever greater amounts of debt… at ever shorter durations… at ever lower interest rates. Sooner or later, the creditors wake up and ask themselves: What are the chances I will ever actually be repaid? And that's when the trouble starts. Interest rates go up dramatically. Funding costs soar. The party is over. Bankruptcy is next.
LINK HERE

Prepare for the Great Depression.
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PLEASE SHOW YOUR SUPPORT & PURCHASE!





Where Did All The Money Go? The Fed Must End



IRAN made 5 Billion Dollars by Dumping The US Dollar
LINK HERE

Krugman: We will Never See Full Employment..Ever


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Krugman, the key measure of economic health is the size of the output gap--which is a measure of the difference between what the economy would be producing if it kept growing at its historical pace and the actual growth (or decline) in the economy. (Incidentally, how come nobody ever talks out an inverse output gap during booms?) Krugman says that at these growth levels we're not really doing anything to close the output gap.

Krugman writes:

When the 3.5% advance number came out, I took to warning people that even if the economy continued to grow at that rate, we wouldn’t see anything like full employment until late in Sarah Palin’s second term. Given the latest number, the date at which we can expect to see a return to full employment is … never.

Actually, the situation may be even grimmer. The odds are good that growth will slow next year as the inventory bounce fades and the stimulus turns from pushing to dragging the economy. Still zombified banks may continue to trap capital and at least some of the business investment from the past year will turn out to be zero-interest rate driven malinvestment.
LINK HERE

Hope for a Strong Economic Rebound is Fading
LINK HERE

Tuesday, November 24, 2009

Great 30 Minute Gerald Celente Video

Government OUTRAGE: 65% tax rates coming


Check the War Surtax HERE

Two top Democrats say they want to impose a new tax on the wealthy to finance any increase in U.S. troops for the Afghanistan war.

Rep. David Obey, D-Wis., chairman of the purse string-controlling House Appropriations Committee, is calling the idea a "war surtax." He said that just as the federal government is expected to pay for its proposed intervention in the health care sector with new taxes, any escalated involvement in Afghanistan should come with a payment plan.
"If we have to pay for the health care bill, we should pay for the war as well ... by having a war surtax," Obey told ABC News in an interview that aired Monday. "The problem in this country with this issue is that the only people that has to sacrifice are military families and they've had to go to the well again and again and again and again, and everybody else is blithely unaffected by the war."

Sen. Carl Levin, chairman of the Senate Armed Services Committee, is making a similar demand.

Now, readers of any duration know I’m vehemently opposed to the doomed adventure in Afghanistan. On that front alone, the idea of a war tax is like a shard of glass in my eye.

But it’s even worse than that. It shows just how degraded this country has become – picking the pockets of the productive is now pretty much the only remaining source of funding the administration and its allies can imagine.

Just to be sure we keep this in perspective: At this moment, if you earn more than $250,000 a year (which isn’t what it used to be, given the steady erosion of inflation over the last 30 years), you will pay federal income taxes of about 35%, no estate taxes, and a 15% capital gains tax should the money you put at risk in the market return a profit.

As soon as next year – should the government move up the expiration of the Bush tax cuts, as I very much expect them to – the top tax bracket will go to 39%. On top of that, the current healthcare legislation will add a 5.4% surcharge. Then, add in the Democrats’ proposed 5% war tax. Okay, so straight up we’re talking 49%.

Then there’s a near doubling of capital gains taxes, from 15% to as high as 28%. And, of course, the return of the estate tax.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

FDIC in The Hole Over 8 Billion: More Money Needs To Be Printed


WASHINGTON (Dow Jones)--The government insurance fund that protects more than $4.5 trillion of U.S. bank deposits slipped into the red at the end of September, after fifty banks collapsed during the third quarter.

The deposit insurance fund dropped by $18.6 billion during the third quarter of 2009 to negative $8.2 billion, as the Federal Deposit Insurance Corp. set aside $21.7 billion in provisions for additional bank failures. This is the second time in the agency's history that the balance has fallen into negative territory.
LINK HERE

Out Of Money: Families Digging The Graves


HOCKINGPORT, Ohio -- Jesse Hayes' family, already overcome by grief after he died in a house fire last month, quickly had to come to grips with another unthinkable reality.

With no money for a funeral, they would have to bury him themselves.

And so the day before Hayes' graveside service Oct. 15, his cousin and a handful of volunteers gathered with their shovels at Stewart Cemetery, a quiet spot in the woods not far from the Ohio River in southern Ohio.

They spent four hours digging with the shovels before finally being forced to bring in a backhoe when they hit rock about 3 feet down.

After a brief graveside service the next day, the family went to the nearby Lions Club for a meal provided by friends while the volunteers returned to cover the casket with dirt, finishing the grim task.
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She said a friend from nearby Meigs County had no money when her teenage son drowned a few years ago. After a church service, the mother, who was widowed, her daughters and their boyfriends loaded the inexpensive casket onto the back of a truck and drove to a cemetery two counties away. The teen would be buried in his mother's plot, next to his father.

They dug for hours, hit rock and had to return with a rented jackhammer.

"They finally got the casket down in there and start filling it with these big rocks. There was this big crack and (the mother) started screaming," Roberts said.

"The casket had caved in."
LINK HERE

FAMILIES DEVASTATED By Budget Cuts and Raising Taxes
COOLVILLE, Ohio -- "Here's home," Lori Hopkins said, gesturing toward a dilapidated camper parked along a gravel road in the hills of southeastern Ohio.
"And here's where we do our business," she deadpanned, turning to the surrounding woods.
LINK HERE

THE VACCINE DOES NOT WORK
LINK HERE

Restaurants are Empty: Nobody Eating Out


The number of people visiting restaurants has plunged for four quarters in a row, according to NPD Group. Some higher-end establishments are offering discounts for holiday parties.

Adele Cabot and her husband used to dine out three to four times a week, regularly spending $75 to $100 at a sushi bar sampling rainbow rolls and yellowtail nigiri sushi.

But that changed after Cabot, an adjunct professor of theater at UCLA, had to take a 6% salary cut. The couple now eat out half as much and frequent less expensive Mexican and Italian places.

"I just don't want to spend the money to eat out a lot," Cabot said.

With Thanksgiving this week and Christmas next month, restaurants are eager to win back customers such as Cabot who seemed to disappear amid a brutal summer for the nation's eateries.

Restaurant owners are worried that tight corporate entertainment budgets, cash-conscious consumers and greater competition from price-cutting supermarkets will make for another dreary Christmas.

The number of people visiting restaurants has plunged for four consecutive quarters, according to NPD Group, a market research firm. Companies as small as Tender Greens, with just three restaurants, and as huge as the Denny's chain are braced for another difficult year.

"Until the economy gets through these unemployment and foreclosure issues, we are going to have a tough time," said Nelson Marchioli, chief executive of Denny's Corp., of Spartanburg, S.C. "The economy has really put our customers in a tough position."
LINK HERE

Monday, November 23, 2009

Massive Wave Of Debt Payments Facing US Government


The United States government is financing its more than trillion-dollar-a-year borrowing with i.o.u.’s on terms that seem too good to be true.

But that happy situation, aided by ultralow interest rates, may not last much longer.

US Capitol Building with cash

Treasury officials now face a trifecta of headaches: a mountain of new debt, a balloon of short-term borrowings that come due in the months ahead, and interest rates that are sure to climb back to normal as soon as the Federal Reserve decides that the emergency has passed.

Even as Treasury officials are racing to lock in today’s low rates by exchanging short-term borrowings for long-term bonds, the government faces a payment shock similar to those that sent legions of overstretched homeowners into default on their mortgages.

With the national debt now topping $12 trillion, the White House estimates that the government’s tab for servicing the debt will exceed $700 billion a year in 2019, up from $202 billion this year, even if annual budget deficits shrink drastically. Other forecasters say the figure could be much higher.
LINK HERE

SubPrime 2 Collapse Coming?


So here’s the nightmare scenario, which we hope will not happen:
Thousands of very smart speculators have accumulated the biggest ever speculative physical raw material positions ever witnessed in the belief that either the dollar will collapse or an ongoing global ‘Supercycle’ will shake off the effects of the credit crunch and resume business as usual. They are funded in this venture by some of the lowest interest rates on record. What are the threats to their thesis?. They are as follows :

1. Governments, having pumped huge amounts of money into the global system, find they are running our of fire-power even while economies are still at the incubation-stage of recovery (i.e. the kind of stage we saw displayed last week in the poor USA housing starts data). Some governments find that suddenly their bonds are considered to be ‘toxic’ and a far higher interest rate is demanded for ongoing participation.

2. The global economy not only experiences a slower upturn than the consensus view, but after the recent inventory-restocking phase is over, it relapses into a W-shaped recession. More jobs are lost and people who have been unemployed but still able to keep up their mortgage payments (because of near-zero interest rates) are suddenly defaulting. Banks finally
have to write down the value of these assets and housing markets around the world are flooded with new inventory. New-build is out of the question. Orders for new fridges, washing machines, stoves, taps and other items
that metals so depend on for demand, simply freeze.
LINK HERE

Prepare for the Great Depression.
Survival Seeds

Here Is Why The Dollar Is Now Effectively Worthless


A picture is worth a thousand Krugman essays, which is why we present a chart comparing the US Monetary Base (and by subtracting Reserve Balances with Fed Reserve Banks, Currency in Circulation), and the Fed's holdings of MBS and Agency paper (worthless GSE/FHA garbage). In summary: Currency in Circulation: $920 billion; MBS/Agency Holdings: $997 billion. The dollar in your pocket is now entirely backed only by worthless, rapidly devaluing and subsidized housing.
LINK HERE

Move Your Money Out of America and Soon


Things are getting uncomfortable for individuals and corporations looking to deposit their money in tax havens around the world. Just recently, Congress introduced the so-called "Stop Tax Haven Abuse Act," which is designed to do away with the privacy afforded by doing business or investing outside the U.S. and to eliminate or reduce tax benefits available offshore.

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We would suggest looking at Saxo Bank in Denmark.

If you have gold, it would be highly beneficial to get it out of the U.S. - stat. If you do keep it in the U.S., your only truly reliable and private option is to store it yourself in a safe that you bury in your backyard. Otherwise, move it out of the U.S. now before Team Obama pulls an FDR and takes your gold from you.

At the moment, gold is not considered a monetary instrument by the U.S. Customs and Border Patrol, so there is no legal requirement to declare your bullion upon leaving the United States. Some countries, like Taiwan and Uruguay, require you to declare gold in excess of a certain value to customs officials upon entry.

We recommend Panama, Austria, Switzerland, and the United Arab Emirates as locations to store bullion; one particular favorite is a location called Das Safe (www.dassafe.com) in Vienna where anonymous safes start at 400 euro/year.

Real Estate

It might sound counterintuitive after the subprime debacle, but real estate is a sound option for moving money outside of the United States; there are zero reporting requirements. It's your business where you own property, and (so far) no one else's. You can purchase property in a private way by setting up a corporate structure to hold the assets so that they're not in your name (Panama is an excellent jurisdiction to set this up), and although there are many places with depressed real estate markets, there are also many with good growth potential: in Latin America, we would recommend Panama, Colombia, Uruguay, and Chile. In Europe: Slovakia, Albania, and Poland. In the rest of the world: Lebanon, Hainan Island (China), the Philippines, Cambodia, and New Zealand.

Time is of the essence - start looking for your safe haven now
LINK HERE

Citizens start arming themselves to protect their homes and families


NORTH LAS VEGAS, NV - In the last several months gun sales are going up. Store owners say people are arming up to protect themselves.

According to the North Las Vegas Police Department, in just that three months 22 burglaries occurred in a one mile radius from where Officer Nettleton was killed.
Gun sellers say they now have customers coming in daily who've never even thought of shooting a gun before and now they want to own one.

"With the increase in crime and the instability outside your door...I can see where people feel more and more necessary to protect themselves because you don't know how soon law enforcement can come to your assistance," gun owner, Leonard Cola, says.

But those who sell guns say lethal force isn't always the best choice. They also recommend tasers, pepper sprays and batons, as well as staying aware of your surroundings and taking steps to secure your home.
LINK HERE

Glitch’ could cut jobless benefits for a million
Congress must act before Christmas for extended subsidy to take effect
LINK HERE

Sunday, November 22, 2009

Wall St. Ripping Off The Public on Mortgages


As millions of Americans struggle to hold on to their homes, Wall Street has found a way to make money from the mortgage mess.

Steven and Marisela Alva were grateful for new loan terms on their home in Pico Rivera, Calif.
Investment funds are buying billions of dollars’ worth of home loans, discounted from the loans’ original value. Then, in what might seem an act of charity, the funds are helping homeowners by reducing the size of the loans.

But as part of these deals, the mortgages are being refinanced through lenders that work with government agencies like the Federal Housing Administration. This enables the funds to pocket sizable profits by reselling new, government-insured loans to other federal agencies, which then bundle the mortgages into securities for sale to investors.

While homeowners save money, the arrangement shifts nearly all the risk for the loans to the federal government — and, ultimately, taxpayers — at a time when Americans are falling behind on their mortgage payments in record numbers.
For instance, a fund might offer to pay $40 million for a $100 million block of mortgages from a bank in distress. Then the fund could arrange to have some of those loans refinanced into mortgages backed by an agency like the F.H.A. and then sold to an agency like Ginnie Mae. The trick is to persuade the homeowners to refinance those mortgages, by offering to reduce the amounts the homeowners owe.

The profit comes when the refinancings reach more than the $40 million that the fund paid for the block of loans.
LINK HERE

15 Signs American Society Is Coming Apart at the Seams

The economic elite have launched an attack on the U.S. public and society is unraveling at an increased rate. You may have missed it in the mainstream news media, but statistical societal indicators are reading red across the board. Let’s look at the top 15 statistics that prove we are under attack.

1) The inequality of wealth in the United States is soaring to an unprecedented level. The U.S. already had the highest inequality of wealth in the industrialized world prior to the financial crisis. Since the crisis, which has hit the middle class and poor much harder than the top 1 percent, the gap between the top 1 percent and the remaining 99 percent of the U.S. population has grown to a record high.

2) As the stock market went over the 10,000 mark and just surged to a 13-month high, the three big banks that took taxpayer money and benefited the most from the government bailout have just set a new global economic record by issuing $30 billion in annual bonuses this year, “up 60 percent from last year.” Bloomberg reported: “Goldman Sachs, the most profitable securities firm in Wall Street history, had a record profit in the first nine months of this year and set aside $16.7 billion for compensation expenses.” Goldman Sachs is on pace for the best year in the firm’s history, and it is also benefiting by only paying 1 percent in taxes.

3) The profits of the economic elite are “now underwritten by taxpayers with $23.7 trillion worth of national wealth."

As the looting is occurring at the top, the U.S. middle class is just beginning to collapse.
THE REST HERE

Get Ready for a Silver Breakout


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Metal Money

Silver, unlike gold, is more of an industrial metal used in a wide array of applications, including photography, dentistry and electronics. Its performance is more tied to the global economic cycle than gold and therefore is not to be confused as a pure hedge against monetary chaos or financial turmoil.

Though silver will almost always follow gold, I still prefer the yellow metal as a better store of value. Earlier this month the Indian central bank purchased 200 tons of gold from the IMF; no central bank, however, has amassed silver this decade.

My target for gold remains about $2,500 an ounce in this bull market and about $75 an ounce for silver. If that's remotely correct then silver can gain another 300% from current levels compared to 118% for gold. If silver reaches its approximate 1980 inflation-adjusted equivalent then prices can surge another 575% from current levels.

I began making these forecasts on gold and silver seven years ago at various seminars for The Sovereign Society. At the time, investors would look at me wondering what planet I came from. Not anymore.

When?

Bull markets are like a rubber band. The primary trend is always exaggerated much longer than we can anticipate. And in the age of violent capital markets, aggressive central bank printing and the prospect of higher inflation over the next several years it's no wonder investors and even central banks are accumulating gold. Smart people increasingly distrust paper money.

What will kill this bull market?

The only event that's likely to derail gold and silver is higher U.S. and European interest rates. Until the opportunity cost of holding gold and silver are compromised by higher paper money rates of interest, this bull market will run its course. And fortunately for the bulls, the Fed won't be in any position to aggressively hike lending rates any time soon because credit intermediation remains badly fractured while bank balance sheets are still in repair mode.
LINK HERE

Prepare for the Great Depression.
Survival Seeds