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Monday, March 31, 2014

9/11 Mysteries Solved?

Tuesday, March 18, 2014

Recent Jim Sinclair Meeting Roundup

Courtesy SD reader StackerX:
I arrived at the Sutton Room in the Hilton Hotel at about 1:30pm. I figured it would be better to be 30 minutes early than a minute late and too my surprise the room was practically full. Once I entered the room I was also surprised Mr Sinclair had already started answering questions. Their were roughly 800 people at this meeting and hundreds of questions answered. I would say a quarter of the questions revolved around silver. Anyway the Q&A ran till about 5:30pm. Here are some of the notes I was able to capture while there:
1) Cyprus was a major mistake by the IMF. This was meant to shift the onus from debt monetization to the depositors. This means you should move your money out of the banking system and into something else like gold. He also said if Cypus was successful it would have caused the Dow to plummet down to as low as 1000 points because it would be a shift away from QE. QE would be second.
2) IRA timing question. Sinclair: “you have 2-3 years.” Says stop contributing. Get out. Doesn’t have to be right away. You have 2-3 years.
3) FDIC can’t meet its obligations. It could handle one or two bank failures but it cant handle a systemic crisis.
4) Mining production good to start now. 5 years ago maybe not so good.
5) Gold valuation math question: Dividing current fiat by amount of gold held = $15-17,000 gold? Sinclair: too soon to tell. Do this in 2015. This calculation may misguide you now.
6) Gold Confiscation possible? Sinclair: short answer “No” because gold has a different role today then it did back in the 1930′s. Back then they confiscated gold to increase the money supply. “Gold doesn’t function like that anymore”. Sinclair doesn’t believe their will be confiscation. Can’t comment on Taxing it instead.
7) Gold coins less likely counterfeit than Gold Bars.
8) Gold only asset to appreciate.
9) Gold will find its way back into the monetary system
10) Gold price to look for: $1517 and $2021.
11) Sinclair on Silver: Silver will rise past $50. It will rise as gold goes higher. Silver is not a monetary metal. The price of silver is based on the paper markets, because of this the supply is infinite. “The high Silver price wont be fulfilled”. “He cant agree on a really high Silver price”.
12) Why doesnt someone/ Billionaire try to corner the Silver market? Sinclair: because they will end up like the Hunt brothers.
Brings up a Jesse Livermore example where he was once pressured to take delivery. He said Livermore was a gentlemen and refused. Said other billionaires probably don’t want to go down in history as the person who crashed the Comex.
If the Hunts took delivery they may have ended up behind bars. When you break an exchange it creates a false price upwards. Problem with a Comex crash is it will go up but then crash down. He said it would be “orgasmic” lol. It is better to have a steady rise up!
13) Gold storage companies may become unethical like any other company.
14) Question about Gold Silver ratio. Sinclair: “He doesnt believe in ratios”
15) Sinclair is more of a believer of gold.
16) What about Silver? ” Silver will also do well”
17) Gold will be revalued by the market
18) Their has never been a nationalized mine that made a profit.
19) Remonetization of Silver is unlikely.
20) Yes physical Gold and Silver can run out.
21) Triple digit Silver a myth? Sinclair: Not a myth. But wont hold. $500 Silver probably wont happen.
22) Dow high because of liquidity. (floats all boats)
23) Dow could have a reaction lower sometime soon but then go higher.
24) Significant Gold targets: $248, $1650,
25) Gold was a utility in the 50′s
26) Miners are a great opportunity because they are smashed. Even with a market crash they cant go much lower.
27) QE pullback? Stopping QE creates a black hole. No limit to QE
28) The Fed only has two tools: Debt monetization and Gold revaluation.
29) Gold bull run cycle to end by year 2020-2021
30) Glass Steagall wont come back.
31) He believes Hyperinflation can occur. He believes if we have Hyperinflation it will only last 3 months. “It will be a very ugly experience”. Also said it would be short and violent.
32) Euro will outperform Dollar because they are practicing Austerity.
33) Said their is no solution to over the counter derivatives. He said a derivative is like a knot in a string that loops. He said the collapse of Lehman caused the loop to be cut.
34) 5 year window for BRICS to take over
35) He said next target for Gold was $3,100-3,200. Below $3500 is a buy. By 2015-17 Gold will be roughly $4000-4500.
36) He said if you are a Miner stock holder you must act crazy and raise hell to see profits.
37) He said the significance of March 27th date was it was his birthday. lol
38) Attack on Iran is unlikely. In the past it was possible but it doesnt look attractive today. Russian stealth Submarines may be game changer.
39) If Gold revaluation were to occur within a year it would be roughly $4,499. But could go higher after a year.
40) He was asked if he has a leg up in the industry. He said of course. Being in this business for as long as he has means he trades information with heads of industry.
41) He doesnt believe Comex will fail.
42) Question about Bitcoin? Sinclair:” it may not be practical”

*Recap from Green Lantern:
The room was packed. I came in at 1:30 thinking it would start at 2:00pm. He must have started at 1pm and took questions non-stop for at least 4 hrs. I left at 5pm. He entertained any question by anyone with great patience and kindness.

More people in that room than attended the Hard Assets conference last year to hear Eric Sprott and Rick Rule speak.

In the spirit of JIm Sinclair, I hope this is helpful.

How does the Cyprus, IMF, Russia situation effect the price of gold.

The situation represents a major shift of paradigm from bail out to bail in’s. From QE to keep banks afloat to stealing people’s money as the new form of QE  .short falls of the bank. Shifting the burden of QE to the depositors. Russians set up banks in Cyprus and Europe for themselves.

IMF is no competition for Russia. If IMF insists on confiscation, they will create velocity out of fiat into gold. It will backfire on IMF as people get out of the banking system and putting it into gold. The same tax is being implemented in Spain and New Zealand. On Cyprus “they were informed that this was going to happen”

There is a silent movement in the United States. All the people in this room represent a grass roots movement. You can trigger events by doing the wrong thingIt’s getting to he point that the average guy knows he has been had. If government wants to take the other guys money, realize that we are a feisty bunch. So politically government has to walk the razor’s edge or start civil unrest. It would very very dangerous to pull a Cyprus in the United States.

the Euro took a big hit with Cyprus. it will come back and out survive the US Dollar. They are on austerity. We should be approaching the end game but refuse to face it.

Should I get out of my IRA’s? Yes. Take the tax loss and protect your money Banks, brokerage houses etc… While FDIC insures banks it doesn’t insure all the systemic risk as clearinghouses will go broke.
Sinclair kept throwing out dates like 2015, 2016 as the line in the sand to get out. People were concerned about time loosing the 50% matching money. He said you have two years to think about it.
Will Confiscation of gold take place? Confiscation occurred because gold was the QE of time. FDR had to increase the money supply. Confiscation didn’t bring in alot of gold but it did control price. More likely a wind-fall tax based on punishment more probable than confiscation. The confiscation meme exists as fear. A tool to keep you away. No better tool than gold to deal with solvency.

Gold will find it’s way back into the system as paper markets have less influence than physical market.
What do you think of silver? The high expectations of silver will not be fulfilled. Silver is not monetary like gold. $500 silver improbable. 3 digits yes as it will follow gold. Gold silver ratio is meaningless.
Ratio is 20/20 hindsight. I don’t believe in ratio’s It changes all the time. (he elaborated but don’t have the notes). I believe in gold more than silver however I do not want to pee on anybodies parade. Silver will do well. Gold has more monetary implications. Silver does not.

Should we hold some gold in storage houses in foreign countries? By 2017 we will experience tight capital controls. As the gold market continues one will have to look out for unscrupulous business from coin sellers to storage facilities. Storage facilities creates temptation.Have gold on your person

What do you think of Bitcoin? Intriguing but not practical Bitcoin not better than Krugerrand.

Is Sprott silver PSLV as safe as holding silver? Sprott is a top man. He will not steal your silver in any form. I invest in Sprott.

Why doesn’t Eric Sprott just place bets on the COMEX and take it out? Now he has to wait three months for delivery why doesn’t he just do it on the COMEX if he is really interested in silver realizing it’s full potential and helping everybody out? Because he is a gentleman same as Jesse Livermore. It’s not the right thing to do. Eric Sprott knows in his heart that fundamentals of silver will see light of day. Same outcome. Plus if he did it, they might put him behind bars.

Will gold mines suffer from nationalization/confiscation? Yes, possible. Mines never do well when governments take over.

Is the entire financial system a ponzi system? (Much longer question and much longer answer) but YES. Especially now. No ethical behavior. It is as bad as Sodom and Gomorrah except S&G was alot more fun. All societies reach this point.

How Close to a tipping point are we and at what phase in the gold market are we in compared to the 70′s? We are past the tipping point. We’ve entered wonderland. In the 70′s, we pulled back from the edge, now we have papered up all the problems. We drove into a big hole in the road and then threw a big rock in it. We can’t compare the three phases of the bullmarket, steal etc…, because now the dynamic is different. We should have peaked. If all of you come out the other end with what you have now, you’ll be fortunate.
My children were thinking of opening up a food business but with what’s going is it just an effort in futility? No. Food business, farming etc.. Good business’s. Don’t let the jerks stop you from living your life.
Other professions were mentioned through out the meeting. Education to the youth is of paramount importance. You are not looking to give your kids your called. You are looking to educate them and use it to help them start out on their own.

The usual things that people think will create value for gold will not effect it as much as the paper market dying, velocity of money being created by financial repression, bail outs to bail in. As the bleeding takes place, they become stupid, make mistakes and it will create velocity out of paper. When they get fat and happy, they get lazy. they are evil men whose appetites can not be satisfied. They always want more. Gold will only reach it’s potential when the paper market dies.

The markets are bigger than the banks. Russia, China, BRICS will bring down western elite. Don’t mess with the Russians.

On Martin Armstrong calling Sinclair a fool. “I do not mind being called a fool by a smart person” Martin is trying to become famous in mainstream financial system. His system of using cycles in the manner he doesn’t work.
Alf Fields, I like him. He doesn’t call me a fool. hardworking, good work. Doesn’t mean always right.
End Game: BRIC countries take over the world in five years. Massive economic swapping of economic and military power from US to China. It’s happening now. Settling transactions in Yuan in other currencies.

See Sinclairs story on his blog about two Chinese submarines appearing out of nowhere near the American flag. The Hunt For Red October is real and represents the paradigm shift of Chinese economic and eventual military superiority. Chinese subs could show up in NY Harbor undetected. We need to learn this technology. Our superior war machine is fading and China will soon take the lead. The end of US supremacy.
Attacking Iran off the table. Two years ago. Likely. Now if they mess with Iran, they mess with china and russia. If I go dead silent and you don’t hear from me, it means something is happening that I don’t like.

What is the best surrogate for gold? I like to answer all questions and because you asked it I would have to say CEF. Central Fund of Canada. I’d prefer to hold my own gold.

Will China become the worlds reserve currency? Not officially. People will choose it. They do not want the burdens that come with that status. Countries transmitting their problems. to them. Gold will back an official world currency

I don’t have much of life. I don’t sleep that much. I do not need that much sleep. I play with my dogs. I live my life for all of you! (applause) I am here for you. I will keep you informed through my blog. I will eventually tell you all my secrets. You will know it too. (told one guy part of his system of accurate prediction of gold came from Jesse Livermores 1923 Wall Street Journal articles)

I have answered well over 200,000 emails. Feel free to email me. Sometimes I miss some but my life is now dedicated to giving service to others. This meeting represents a huge grass root movement.

Mortgage Slaves

Friday, March 14, 2014

How To Rob A Bank

Last Call For The Consumer

You can't get blood out of a rock. Traditionally the United States has had a consumer-driven economy, but now years of declining incomes and rising debts are really starting to catch up with us. In order to have an economy that is dependent on consumer spending, you need to have a large middle class. Unfortunately, the U.S. middle class issteadily shrinking, and unless that trend is reversed we are going to see massive economic changes in this country.

For example, in poor neighborhoods all over America we are seeing bank branches, car dealerships and retail stores close down at an alarming rate. If you didn't know better, you might be tempted to think that "Space Available" was the hottest new retailer in some areas of the nation. On the other hand, if you live in San Francisco, New York City or Washington D.C., things are pretty good for the moment. But as a whole, the condition of the U.S. consumer continues to decline. Incomes are going down, the cost of living is going up, and debts are skyrocketing.

The following are 19 signs that the U.S. consumer is tapped out...

#1 Real disposable income per capita continues to fall.  In the fourth quarter of 2012, it was sitting at $37,265.  By the time that the fourth quarter of 2013 had come around, it had dropped to $36,941.
That means that average Americans have less money to go shopping with than they did previously.

#2 In January, real disposable income in the U.S. experienced the largest year over year decline that we have seen since 1974.

#3 As disposable income decreases, major retailers are closing thousands of stores all over the country.  Some are even calling this "a retail apocalypse".

#4 From September 2013 to January 2014, the personal saving rate in the United States dropped by a staggering 16 percent.

#5 During the fourth quarter of 2013, we witnessed the largest increase in consumer debt in this country that we have seen since 2007.

#6 Fewer Americans are applying for mortgages these days.  In fact, the MBA Purchase Applications Index is now the lowest that it has been since 1995.

#7 Overall, the rate of homeownership in the United States has fallen for eight years in a row.

#8 Many Americans are finding it increasingly difficult to afford a new car or truck.  The following comes from a recent CNBC article...

A new study shows the average household in 24 of America's 25 largest metropolitan areas cannot afford to pay for the average priced new car or truck.
"Just because you can manage the monthly payment doesn't mean you should let a $30,000 or $40,000 ride gobble up such a huge share of your paycheck," said Mike Sante, managing editor of "Many people are spending money on a car payment that they could be saving."
#9 Incredibly, 56 percent of all Americans now have "subprime credit" at this point.

#10 Total consumer credit has risen by a whopping 22 percent over the past three years.

#11 In the third quarter of 2007, the student loan delinquency rate was 7.6 percent.  Today, it is up to 11.5 percent.

#12 Overall, U.S. consumers are $11,360,000,000,000 in debt.

#13 While Barack Obama has been in the White House, median household income in the United States has fallen for five years in a row.

#14 U.S. workers are taking home the smallest share of the income pie that has ever been recorded.

#15 One recent study found that about 60 percent of the jobs that have been "created" since the end of the last recession pay $13.83 or less an hour.

#16 Middle-wage jobs accounted for 60 percent of the jobs lost during the last recession, but they have accounted for only 22 percent of the jobs created since then.

#17 According to one recent survey, only 35 percent of all Americans say that they are better off financially than they were a year ago.

#18 In 2008, 25 percent of all Americans in the 18 to 29-year-old age bracket considered themselves to be "lower class".  In 2014, an astounding 49 percent of them do.

#19 The poverty rate in America has been at 15 percent or above for 3 consecutive years.  That is the first time that has happened since 1965.

Despite what the mainstream media keeps telling them, most Americans know on a gut level that there is something fundamentally wrong with our economy.

According to Gallup, "Unemployment/Jobs" is the number one issue that Americans care about these days and the "Economy in general" is the number three issue that Americans care about these days.

Most people just want to work hard, make a decent living and take care of their families.

Sadly, that is becoming increasingly difficult to do.

And the numbers that I have shared above only tell part of the story.  For a more personal side to all of this, I encourage you to read my previous article entitled "10 Stories From The Cold, Hard Streets Of America That Will Break Your Heart" if you have not done so already.

The really bad news is that this is about as good as things are going to get for the U.S. economy.  The long-term trends that are eating away at our economy like cancer are intensifying, and our "leaders" just continue to act as if "business as usual" will somehow get the job done.

Most of them don't even realize that time is running out.

As I discussed yesterday, there is a lot of evidence that the massive financial bubble that the Federal Reserve has inflated is getting ready to burst.

When the next great financial crisis does strike, it is going to be absolutely disastrous.  We are infar worse financial shape than we were back then, and this next round of financial trauma could truly be the "knockout blow" for the U.S. economy.

Let us hope for the best, but let us also prepare for the worst.

Wednesday, March 12, 2014

14 Reasons Dollar Is Doomed

At the onset of the derivatives collapse in 2007/2008 it would have been easy to assume that most of America was receiving a valuable education in normalcy bias.

In 2006, the amount of ego on display surrounding mortgage investment was so disturbingly grotesque anyone with any true understanding of the situation felt like projectile vomiting. To watch the smug righteousness of MSNBC and FOX economic pundits as they predicted the infinite rise of American property markets despite all evidence to the contrary was truly mind blowing. When the whole system imploded, it was difficult to know whether one should laugh, or cry.

The saddest aspect of the credit crisis of 2008 was not the massive chain reaction of bankruptcies or the threat of institutional insolvency. Rather, it was the delusional assumptions of the public that the grand mortgage casino was going to go on forever. There is nothing worse than witnessing the victim of a Ponzi scheme defend the lie which has ultimately destroyed him. As much as I am for people waking up to the nature of the crisis, there comes a point when those who are going to figure it out will figure it out, and the rest are essentially hopeless.

The cultism surrounding the U.S. economy and the U.S. dollar is truly mind boggling, and by “cultism” I mean a blind faith in the fiat currency mechanism that goes beyond all logic, reason and evidence.

In recent weeks it has become more visible as global financiers play both sides of the Ukrainian conflict, luring Americans into a frenzy of false patriotism and an anti-Russo-sports-team-mentality. My personal distaste for Vladimir Putin revolves around my understanding that he is just as much a puppet of the International Monetary Fund and international banks as Barack Obama, but many Americans hate him simply because the mainstream media has designated him the next villain in the fantasy tale of U.S. foreign policy.

Open threats from Russia that they will dump U.S. treasury bond holdings and the dollar’s world reserve status if NATO interferes in the Ukraine have been met with wildly naive chest beating from dollar cultists. I am beginning to see the talking points everywhere.

“Let them dump the dollar, Russia’s holdings are minimal!” Or, “Let them throw out Treasuries, they’ll just be shooting themselves in the foot!” are the battle cries heard across the web. I wish I could convey how insane this viewpoint is, especially in light of the fact that many alternative economic analysts, including myself, have been predicting just such a scenario for years.

Despite the childish boastings of the dollar devout, there is an extraordinarily good possibility that the life of the greenback will be snuffed out in the near term. Here are the facts…

1) Russia will not be alone in its decouple from the dollar system. China, our largest foreign creditor, and India (a supposed ally) have clearly sided with Russia on the Ukranian issue. China has stated that it will back Russia’s play in the event that sanctions are brought to bear by NATO, or if a shooting conflict erupts.

2) China has already been slowly dumping the dollar as a world reserve currency using bilateral trade agreements with numerous countries, including Russia, India, Australia, Brazil, Germany, Japan, etc. These agreements allow FOREX currency swaps and export/import purchases to be made with China without the use of the dollar. China has been preparing itself for a divorce from U.S. economic dependence for at least a decade. The idea that they would actually follow through over political tensions should NOT surprise anyone if they have been paying attention.

3) A total drop of the dollar or U.S. treasury bonds by Russia and China would send shock waves through global markets. Russia is a major energy supplier for most of Europe. China is the largest export/import nation in the world. If they refuse to accept dollars as a trade mechanism, numerous countries will fall in line to abandon the greenback as well. The fact that so many Americans refuse to acknowledge this reality is a recipe for disaster.

The only advantage the U.S. has traditionally offered in terms of international trade has been the American consumer, whose unchecked debt spending partly fueled the rise of the industrialized East, not to mention the biggest credit bubble in history. The role of America as a consumer market is collapsing today, however. The mainstream media and the Federal Reserve can blame the steady decline in retail sales on the “weather” all they want, but negative indicators in global manufacturing often take many months to register in the statistics, meaning, this destabilization began long before the days turned cold.

4) China has been shifting away from export dependency since at least 2008, calling for a larger consumer based market at home. This process of enriching the Chinese consumer has almost been completed. The lie that China “needs the U.S.” in order to survive economically needs to be thrown out like the utter propaganda it is.

5) China (and most of the world) has ended new dollar purchases for their FOREX reserves, and hasno plans to make new purchases in the future.

6) China executed the second largest dump of U.S. Treasury bonds in history in the past month.

7) Russia, China, and numerous other countries, including U.S. “allies”, have been calling for the end of the dollar’s world reserve status and the institution of a new global basket currencyusing the IMF’s Special Drawing Rights (SDR). Even Putin has suggested that the IMF take over administration of the global economy and issue the SDR as a world currency system. This flies in the face of those who argue that the IMF is somehow “American run”. The truth is, the IMF is run by global banks and no more answers to the U.S. government than the Federal Reserve answers to the U.S. government.

8) The Federal Reserve has been creating trillions of dollars in fiat just to prop up U.S. markets since 2008, and we are still seeing a considerable decline in global manufacturing, retail, personal home sales, and a general malaise in consumer demand. Without a full audit, there is no way to know exactly how much currency has been generated or how much is floating around in foreign markets. Any loss of world reserve status would send that flood of dollars back into the U.S., most likely ending in a hyperinflationary environment.

9) Another rather dubious argument I see often is the claim that the Federal Reserve and the U.S. Treasury could simply “negate” a Treasury dump by refusing to acknowledge creditor liabilities. Or, that they could simply print what they need to snap up the bonds, much like the German government tried to do during the Weimar collapse. Unfortunately, this plan did not work out so well for the Germans, nor has it worked for any other nation in history, so I’m not sure why people think the U.S. could pull it off. However, this is the kind of cultism we are surrounded by. These folks think the U.S. economy and the dollar are untouchable.

Yes, the Fed and the Treasury could hypothetically erase existing liabilities, but what dollar cultists do not seem to grasp is that the dollar’s value is not built on Treasury purchases. The dollar’s value is built on faith and reputation. If a nation refuses to pay out on its debts, this is called default. A default by the U.S. would immediately damage the reputation of bonds and dollars as a good investment. Global markets will refuse to purchase or hold any mechanism that they think will not earn them a profit. How many investors today are anxious to jump into Greek treasury bonds, for instance?
Finally, it is unwise to operate on the assumption that foreign creditors will accept dollars as payment on U.S. Treasury bonds if they believe the Federal Reserve is monetizing the debt. When Weimar imploded under the weight of currency devaluation, many foreign governments refused to accept the German mark as payment. Instead, they demanded payment in raw commodities, like coal, lumber and ore. Expect that China and other debt holders will demand payment in U.S. goods, infrastructure, or perhaps even land.

10) Most treasury holdings in foreign coffers are not long term bonds. Rather, they are short term bonds which mature in weeks or months, instead of years. Dollar proponents constantly cite the continued accumulation of treasury bonds by other governments as a sign that the dollar is still desirable as ever. Unfortunately, they have failed to look at the nature of these bond purchases. When China rolls over millions in short term bonds and replaces them with other short term bonds, this does not suggest they have much faith in America’s long term ability to service its debt. It would also make sense that if China had plans to remove itself from the dollar system, they would move into short term bonds which can be liquidated quickly.

11) China is on the fast track to becoming the largest holder of physical gold in the world. Russia has also greatly expanded its gold purchases. Whatever losses they might suffer from a dump of their Treasury bond investments; it will be more than made up in the incredible explosion in precious metals prices that would follow.

12) The most common argument against the dollar losing world reserve status has been that such a shift would be “impossible” because no other currency in the world has the adequate liquidity needed to replace the dollar in global trade. These people have apparently not been paying attention to the Chinese yuan. China has been quietly issuing trillions in yuan denominated bonds, securities and currency around the world. Current estimates calculate around $24 trillion created by the PBOC and the banks under its control.

Mainstream talking heads are calling this a “debt bubble.” However, this debt creation makes perfect sense if China’s plan is to create enough liquidity in its currency in order to offer a viable alternative to the U.S. dollar. Linking the yuan to the IMF’s basket currency would complete the picture, forming a perfect dollar replacement while dollar cheerleading-economists stand dumbstruck.

13) China's retreat away from dollar denominated investments has left a hole in the U.S. bond market. Recently, that negative space was filled by an unexpected source; namely Belgium. A country whose GDP represents less than 1% of total global GDP buying more U.S. bonds than China? The whole concept sounds bizarre. Here is the capital coming from?
Think about it this way - Belgium is the political center of the European Union and a haven for international financiers. There are more corporate cronies, lobbyists, bureaucrats, and foreign dignitaries in Belgium than in all of Washington D.C. But more importantly, Belgium struck a deal with the IMF in 2012 to begin pumping SDR denominated funds into "low income economies". I would suggest that this funding flows both ways, and that now, the IMF is feeding capital into Belgium in order to buy U.S. Treasury Bonds. That is to say, the IMF is going to start using smaller member countries with limited savings as proxies to purchase U.S. debt using IMF money.

The ultimate danger of the IMF (run by internationalists, not the U.S. government) pre-positioning itself as the primary buyer of U.S. debt is that when the U.S. finally defaults (and it will), the IMF is likely to become the "guardian angel" of the U.S. economy, offering aid in exchange for total administrative control of our financial system, and the institution of the SDR as a world reserve replacement for the dollar.

14) The serious prospect of regional conflict or world war over tensions between the Ukraine and Russia, Japan and China, the U.S. and Syria, the U.S. and Iran, the U.S. and North Korea, etc., could make the effort of exposing the plan to shift economic power into a one world system centralized under the IMF almost meaningless. How many people will truly care about the financial power grab by banking elites if it drifts under the surface of catastrophic engineered wars? They'll be too busy hating and fighting artificially created boogeymen to pay attention to the real globalist culprits.

I have been pointing out for quite a long time that globalists need a “cover event”; a disaster, an economic war or a shooting war, in order to provide a smokescreen for the collapse of the dollar. Alternative analysts have been consistently correct in predicting the trend towards the dump of the dollar. Years ago, we were laughed at for suggesting China would shift towards a consumer based economy and away from U.S. dependence. Today, it is mainstream news. We were laughed at for suggesting that nations like Russia and China would drop the dollar as a reserve currency. Today, they are already in the process of doing it. And, we were laughed at for suggesting that Russia or China would use their debt holdings as leverage against the U.S. in the event of a geopolitical conflict. Today, they are openly making threats.

I have to say, I’ve grown tired of the dollar cultists. How many times can a group of people be wrong and still argue with those who have been consistently right? The answer is that zealots never actually escape their own delusions, even when their delusions lead them and those around them to ruin. I suspect that in the face of complete dollar collapse, they will still be rationalizing the chaos and pontificating on our "lack of understanding" while the theater burns down around them.

India Is Bucking The Trend Developing BRICs

3-12-14 eem vs fxi epi rsx ewz

Friday, March 7, 2014

Your Money Is Not Safe

As I write this, the European Union has just announced a possible $15b aid package to Ukraine (including 8 billion euros in fresh credit). Everybody has read the headlines about Europe: record unemployment, no end in sight, and so on.

So you might be wondering just where the European Union, and its constituent nations, scraped together the money to propose aid for Ukraine.

Well, wonder no more, because the following eight events might give you an idea of where governments go to get a little extra cash.

1. In March, 2009, Ireland seized €4bn from its Pension Reserve fund in order to rescue its banks. In November 2010, the remaining savings of €2.5bn was seized to support the bailout of the rest of the country.

2. In December, 2010, Hungary told its citizens that they could either remit their private pension money to the state or lose their state pension funds (but still have to pay for it nonetheless).

3. In November, 2010, the French parliament decided to earmark €33bn from the national reserve pension fund FRR to reduce the short-term pension scheme deficit.

4. In early January 2011, $60 million in private retirement funds were transferred to the state's pension scheme in Bulgaria.  They wanted to transfer $300 million, but were denied on their first attempt

5. In the Spring of 2013 Cyprus took it a step further and outright confiscated up to 50% of the funds from bank account holders in that country.

6. In the Fall of 2013 the Polish government announced it would transfer to the state (aka. confiscate) the bulk of assets owned by the country's private pension funds (many of them owned by such foreign firms as PIMCO parent Allianz, AXA, Generali, ING and Aviva), without offering any compensation.
7.  In February 2014, Italian banks were ordered by the Italian government to withhold a 20% tax on all inbound wire transfers. Il Sole reported, "the deductions will be automatic (unless prior request for exclusion), and then it will be up to the taxpayer to prove that the money is not in the nature of compensation 'income.'"

8. The savings of all 500 million Europeans can be stolen by the European Union. Why? Because the financial crisis is not over, according to an EU document. The Commission is looking to ask the bloc's insurance watchdog in the second half of 2014 for advice on how to draft a law "to mobilize more personal pension savings for long-term financing," the document said.

So you see, European governments and institutions have already begun seizing private pension funds, slapping 20% taxes on all incoming wire transfers, confiscating up to 50% from private bank accounts and even stating all the savings of Europe are fair game.  As we've said before, this phenomenom of wealth confiscation won't stay confined to Europe. The US has also taken measures to ensure ease of access to the funds of everyday Americans.

We’ve said for many years now that the US government and almost all Western governments are bankrupt. This means they will try to confiscate as much wealth as possible from people who don't carefully save before the collapse. Mark our words: US 401ks and IRAs will be nationalized in the next four years as well—maybe as soon as the next one or two years.

Thursday, March 6, 2014

12 Signs The Economy Is Doomed

Is the U.S. economy steamrolling toward another recession?  Will 2014 turn out to be a major "turning point" when we look back on it?  Before we get to the evidence, it is important to note that there are many economists that believe that the United States never actually got out of the last recession. For example, data compiled by John Williams of show that the U.S. economy has continually been in recession since 2005. So if anyone out there would like to argue that America is experiencing a recession right now, I certainly would not have a problem with that.

In fact, that would fit with the daily reality of tens of millions of Americans that are deeply suffering in this harsh economic environment. But no matter whether we are in a "recession" at the moment or not, there are an increasing number of indications that we are rapidly plunging into another major economic slowdown.  The following are the top 12 signs that the U.S. economy is heading toward another recession...

#1 We recently learned that the number of new mortgage applications in the United States had fallen to the lowest level that we have seen in nearly 20 years.

#2 Radio Shack has announced that it is going to close more than 1,000 stores.  This is just another sign that we are in the midst of a "retail apocalypse".

#3 The ISM Services index just fell to its lowest level in 4 years, and ISM Services Employment just experienced its largest decline since the collapse of Lehman Brothers.

#4 Obamacare is really starting to hammer the U.S. health care industry...

"The Affordable Care Act is creating significant financial uncertainty to health care organizations," said a survey respondent from the health care and social assistance industry.
"With little warning, the negative impact on revenue has been unprecedented."
#5 Trading revenue at the "too big to fail" banks on Wall Street is way down...
Citigroup Inc. (C) and JPMorgan Chase & Co. (JPM) are bracing investors for a fourth straight drop in first-quarter trading, a period of the year when the largest investment banks typically earn the most from that business.
Citigroup finance chief John Gerspach said yesterday his firm expects trading revenue to drop by a “high mid-teens” percentage, less than a week after JPMorgan Chief Executive Officer Jamie Dimon said revenue from equities and fixed income was down about 15 percent. If trading at the nine largest firms slumps that much, it would extend the slide from 2010’s first quarter to 36 percent.
#6 One of the "too big to fail" banks, JPMorgan, is planning to fire "thousands" more workers.

#7 Moody's has downgraded the credit rating of the city of Chicago again.  Now it is just three notches above junk status.

#8 The U.S. economy actually lost 2.87 million jobs during the month of January according to the unadjusted numbers.  Over the past decade, the only time the U.S. economy has lost more jobs during the month of January was in 2009 at the peak of the last recession.

#9 In January, real disposable income in the U.S. experienced the largest year over year decline that we have seen since 1974.

#10 Only 35 percent of all Americans say that they are better off financially than they were a year ago.

#11 Global retail sales for machinery giant Caterpillar have fallen for 14 months in a row.

#12 The economic data show that virtually all of the largest economies on the planet are slowing down right now.  The following is from a recent Zero Hedge article...

The last 3 weeks have seen the macro fundamentals of the G-10 major economies collapse at the fastest pace in almost 4 years and almost the biggest slump since Lehman. Despite a plethora of data showing that 'weather' is not to blame, US strategists, 'economists', and asset-gatherers are sticking to the meme that this is all because of the cold on the east coast of the US (and that means wondrous pent-up demand to come). However, as the New York Times reports, for the earth, it was the 4th warmest January on record.
For much more on how the rest of the global economy is also slowing down, please see my recent article entitled "20 Signs That The Global Economic Crisis Is Starting To Catch Fire".

Meanwhile, things in Ukraine continue to become even more tense, and the Russian government continues to debate how it will respond if the U.S. does end up deciding to hit Russia with economic sanctions.

According to one Russian news source, the Russian parliament is actually considering theconfiscation of the property and assets of U.S. businesses in Russia if the U.S. decides to go ahead with economic sanctions against Russia...

The upper house of Russia’s parliament is mulling measures allowing property and assets of European and US companies to be confiscated in the event of sanctions being adopted against Russia over its threatened military intervention in Ukraine.
We are talking about banks, retail chains, mining operations, etc.

U.S. companies have billions invested in Russia, and all of that could be gone in an instant.

So let us certainly hope that economic war between the United States and Russia is averted.  Our economy is hurting enough as it is.

But no matter how things with this crisis in Ukraine play out, it looks like hard times are ahead for the U.S. economy.

Unfortunately, most Americans never learned the lessons that they should have learned back in 2008.

They just assume that the federal government and the Federal Reserve have fixed our problems and have everything under control, so they are not preparing for the next great crisis.

In the end, tens of millions of Americans will be absolutely devastated when they get absolutely blindsided by what is coming.