Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.
Mon 11.30.2009
Gold price to jump over $2,960 TGR: You've previously mentioned all currencies are devaluing almost simultaneously. Other than currency devaluation, what's driving the price of gold and silver? RW: Well, a lot of it is fear; gold is now basically considered to be money in many of the foreign countries, partially in the U.S., more overseas. I think a perfect example is Vietnam. It looked like they were going to have some things that would work out in their economy, and unfortunately for them, a lot of it's coming apart. And they know from experience that if they can get into gold and hang on, they're going to be a lot better off.
Reasons Why Gold Is Going to $1,300 an Ounce The gold bears got tossed a bone last week, when the World Gold Council reported that total gold demand dropped 34% in the third quarter from a year earlier. To be sure, total identifiable gold demand was up 15% from the abysmal second quarter, but the bears seized on the news as a sign that gold has one foot on the Slip ‘n’ Slide of Doom. Yeah, sure. That’s why gold prices just hit a new high. Let me tell you about six things that gold bears aren’t considering. Some is just new information on basics you already know. But some of this news could rattle your cage.
Fact #1: We’re at Peak Gold!. . .
Fact #2: South Africa’s Gold Reserves Downgraded by 90%!. . .
Fact #3: Central Bank Purchases of Gold Are Increasing. . .
Fact #4: By Historical Standards, Gold Is Cheap. . .
Fact #5: Government Debt Is Exploding. . .
Fact #6: All Major Currencies Are Falling Against Gold. . .
Gold Rebounds After Friday's Plunge, Where Next? It looked like a rough time on Friday but gold rebounded and in the end it wasn’t all that bad. Where does that leave us now? GOLD LONG TERM Although the week was a good one, even with a day’s holiday, the long term momentum indicator continues to give some concern. As mentioned last week, concern is one thing but what’s happening is another. Although there is concern for the loss of strength shown by the momentum indicator the direction of action continues to be upward. For now everything still looks good but we should not forget the warning from the diminishing momentum.
Gold gains from dollar roller-coaster ride Currency markets could be unsettled this week. The dollar weakened sharply last week. Further declines may not be seen for the dollar, but the dollar could toss and turn against the euro and other currencies. The European and North American economies are moving toward an economic recovery. Whether they will achieve a sustainable recovery or fall back into recession is not clear. Pending any major economic or financial disruption, recovery seems most likely, but there are any number of problems looming over the world economy at present that could upset this outlook.
Gold still shines despite denting from Dubai AUSSIE gold producers won't be fretting too much about the retreat in gold prices from record levels in response to renewed strength in the US dollar, itself due to Dubai's financial crisis. Gold closed $US15.30 an ounce lower at $US1176.70 an ounce in the US on Friday, leaving it at a level at which if the gold producers can't make money, they shouldn't be in the game. On average, they are making plenty at these levels. A nice bit of research work from Mike Chester at Axiom Advisory tells us so. A survey of September-quarter production reports by Chester found gross margins for small to mid-tier gold producers were in fact lower than in the preceding June quarter at $A394 an ounce, due mainly to the strong US exchange rate.
World Markets Tumble on Dubai Debt, Weak Dollar
Jim Rogers Says Gold Price Will Double in Months The rally in gold prices has driven several bullion analysts to frenzied forecasts. Some say gold prices will reach $2,000 per ounce soon. Others are predicting big boom for the yellow metal, saying gold prices will zoom to $5,000 and eventually to even $15,000 per ounce in the years to come. What is happening in bullion market these days? Yes, agreed that weakening dollar, global economic meltdown, shrinking gold supply and increasing cost of mining gold from the earth are all making gold the most-sought after investment these days. That is also driving the yellow metal prices to record highs.
Jim Rogers on Why Gold Is Glittering So Brightly Maria Bartiromo talks to Jim Rogers . . . . Well, I own gold and I have for a while. How high can it go? I fully expect it to be over a couple thousand dollars an ounce sometime in the next decade—I didn't say the next month, I didn't say the next year, I said the next decade—because paper money around the world is very suspect. But right now everybody's bullish on it, so I don't like to buy things when that's happening. But I'm not selling under any circumstances.
How High Can the Gold Price Rise in the Short-Term? It took a few days for the market to understand the impact of the Indian Reserve Bank's purchase of 200 tonnes of the I.M.F.'s gold sale of 403.3 tonnes, but eventually the market did respond. Since then, one of several announcements has been made, concerning the balance of 200.3 tonnes still being sold. The I.M.F. has promised to inform us that they will tell us how much they were unable to sell and to sell that amount, if any, slowly in the 'open market' without disrupting the price. We will be surprised if there is any left. India has indicated it will buy more if given the chance. So keep your eye open for the next announcement too [Since this was published Sri Lanka has bought 10 tonnes].
Dubai shakes equity markets, helps gold Overnight news out of Dubai has sent global equity markets reeling and generated a safe haven flow into the US Dollar as carry trades are unwound and a flight away from risk occurs. Dubai has asked for a 6 month moratorium on its debt obligations, which for all practical purposes is a type of default. Needless to say, this came with little to no warning and has sent the markets into quite a tizzy. Gold shot higher on the news and touched a record $1,195 before some light long liquidation connected with carry trade unwinding got underway. Look for it to be well bid on any setbacks in price as this sort of news is extremely disturbing. After all, we are talking about the financial hub of the Middle East. Imagine the repercussions that would occur should London have announced this sort of news and you can understand why stock markets were pummeled overnight.
Dubai drags gold to first loss in 10 days Debt jitters spark broad-based selling in metals futures Gold futures fell Friday, ending their nine-session winning streak, as Dubai's debt woes fueled a sell-off in commodities and stocks, while the U.S. dollar gained against its rivals. Gold for December delivery tumbled from a high of $1,195 an ounce to an intraday low of $1,130.10 in electronic trading overnight -- a decline of more than 5%. However, floor trading yielded a narrower loss, with the contract ending down $12.80, or 1.1%, at $1,174.20 an ounce on the Comex division of the New York Mercantile Exchange. The contract had soared more than $80, or 7.3%, over the previous nine sessions. Trading on the exchange was closed Thursday for the Thanksgiving holiday. Despite Friday's losses, the metal ended the week up 2.6%.
The Gold Market Fights Back There was some quirky behavior in the gold market – as a consequence of the market-shock from the announcement by Dubai World that it was essentially defaulting on its debt. The first reaction of the gold market was a move up, although gold gave up those gains over the course of trading on Thursday. Then there was the much more suspicious move in the gold market the day after the announcement – which (by pure coincidence) occurred when U.S. markets re-opened after the U.S. Thanksgiving. Gold plummeted over 5% in essentially the blink of any eye. It then bounced back nearly as quickly. This “delayed reaction” reeks of the gold-sabotage operations for which the anti-gold cabal have become famous. However, the powerful rebound of not only the precious metals, but also the precious metals miners has provided a vivid illustration of the waning power of that cabal.
China, gold, and the civilization shift Stephen Jen from the hedge fund Blue Gold Capital has a warning for those who think that gold has risen far too high, is necessarily in a speculative bubble, and must soon come clattering back down. Mr Jen is an expert on sovereign wealth funds from his days at Morgan Stanley. The gold story - essentially - is that the rising economic powers of Asia, the Middle East, and the commodity bloc are rejecting Western fiat currencies. China, India, and Russia have all been buying gold on a large scale over recent months. Why should that stop when the AAA club of sovereign debtors is pushing towards the danger threshold of 100pc of GDP? These new players account for almost all the accumulation of foreign currency reserves worldwide over the last five years, so what they do matters enormously.
Gold sparkles in 'perfect storm' for precious metal Gold prices have rocketed to record heights close to $1 200 an ounce as a "perfect storm" of market conditions propels demand for the precious metal, analysts said. Gold, whose two main drivers are jewellery and investment buyers, hit a record $1 195,13 dollars an ounce on the London Bullion Market on Thursday. The glamorous metal has won major support in recent weeks and months from a weak dollar, inflationary fears and increasing moves by central banks to diversify assets away from the greenback and into the commodity.
Precious metals pushing up commodity prices Precious metals prices continue to move higher, with gold reaching record levels. Investors have been driving the increase in prices, out of a range of economic, political, and financial concerns. The last two weeks saw a diminution of the price sensitivity of some investors, including some in India and North America: Investors that had resisted buying into the rally to record high gold prices capitulated, and started buying. This helped propel prices higher last week.
Australia's gold output to rival China's FALLING US and South African gold production has pushed Australia back to the No 2 spot behind China in global annual output of the precious metal. Industry consultant Surbiton Associates' quarterly survey, released yesterday, states that Australia produced 112 tonnes of gold in the first half of this year. That compares with Chinese equivalent production of 147 tonnes in the same period, 105 tonnes from the US and 103 tonnes from South Africa. South Africa used to be the world leader but dropping underground grades and increasing mining costs have rendered many of the Witwatersrand deep deposits less economic.
Dubai melts gold The Dubai impact was visible on Friday on bullion market with the gold dropping the most since January in London. Prices of other precious metals, crude oil and all six main industrial metals on the London Metal Exchange declined. The market is reacting to the news on Dubai. Gold for immediate delivery dropped as much as $50.28, or 4.2 per cent, to $1,138.10 an ounce, the biggest intraday slide since January 12.
Dubai's Debt Reckoning How one bursting bubble could feed the next one. The credit problems of a unit of Dubai's state-owned investment company have given financial markets a scare, but put us down as thinking the event is left-over business from the mid-decade mania more than it is a sign of immediate new economic troubles. Like subprime mortgages and Citigroup's off-balance sheet "structured investment vehicles," Dubai's debt binge was made possible by the Federal Reserve's global subsidy for credit. As a Middle East outpost without oil wealth, the city-state used easy credit in an effort to build itself into the next Singapore. And it has made some impressive strides as a tolerant entrepot for traders and investors looking for an entry into the Arab world. Its openness to the world's money and people is certainly a better model for Middle East development than is Saudi Arabia.
Keiser on 'Tsunami alert': Dubai debt crisis awakes storm? Fresh fears over the size of Dubai's debt have sent shock waves through international markets, with major stocks and oil prices falling sharply. Dubai World, the country's largest conglomerate, wants to suspend payment on its sixty billion dollar debts until next May at the earliest. RT's financial contributor Max Keiser says the World is entering the Phase Two of the global economic crisis.
Dubai World Will Shake Confidence, Send Stocks ‘Limit Down’ Dubai’s stocks are poised to drop the most allowed by regulators on the first day of trading since the government said Dubai World, a state company with $59 billion of liabilities, may delay debt payments. The Dubai Financial Market opens today for the first time since the Nov. 25 announcement that caused stocks to tumble from Tokyo to New York and doubled the cost of protecting against the emirate reneging on debt obligations.
Dubai: Bling City is dead, but the desert dream lives on Dubai World's collapse alarmed investors and was a blow for a ruler who wanted to create an Arab city of global significance. But for all its faults it remains a rare oasis of Middle East moderation and progress A yachtsman friend of mine was sailing the blue waters of the Persian Gulf off the shimmering coast of Dubai recently when he came across a disturbing phenomenon: The World was dissolving before his eyes. It was not the grog. Three years ago, when Dubai's debt-fuelled boom was at its height, the emirate launched its most ambitious project yet – a gigantic offshore replica of the planet Earth, made from sand dredged from the deserts and beaches of Arabia, with countries and continents carved out among a man-made archipelago of 300 islands. It was called simply The World.
U.S. banks less exposed to Dubai than European rivals Derivative-based hedging, loan syndication clouds ultimate exposures U.S. banks are probably less exposed than European rivals to a potential debt default by Dubai World, but a lack of transparency and the interconnectedness of the modern financial system make it difficult to know which institutions are ultimately exposed, analysts said this week. Dubai said late Wednesday that it would restructure Dubai World, a sprawling conglomerate behind many of the largest construction projects in the Persian Gulf emirate.
Dubai: Floating on an Island of Debt Stock markets around the world cracked on Friday with the Dow Jones industrial average down more than 150 points (Fig. 1), and commodities plunging as Dubai debt woes unnerved investors, and sent tremors of uncertainty throughout all markets. The crisis flared after Dubai, a part of the United Arab Emirates (UAE) federation, asked to delay interest payment for six months on $60 billion of debt issued by the state-run conglomerate Dubai World and its main property unit Nakheel.
Can Dubai's energy reserves pay off its $80 billion in debt? The Dubai debt default seems to have inspired a bit of fear in the U.S. But is there any real reason for it? U.S. banks have minimal exposure to Dubai's debts -- most of the banks that would suffer if Dubai defaulted are located in the Middle East. Nevertheless, U.S. markets fell 1.7% Friday during a holiday-shortened trading day -- after futures suggested the market would be down 2.7%. But if Dubai's oil reserves exceed its debts, it could sell oil to repay them.
Dubai May Forfeit Status as Financial Hub to Get Abu Dhabi Help Dubai, the debt-laden Gulf city- state, may lose its status as the region’s financial hub in return for a rescue package from its oil-rich neighbor Abu Dhabi, economists and analysts said. The bailout will mean eliminating financially unviable parts of the competing, state-run companies which lie at the root of the city’s at least $80 billion debt, according to Dubai-based UBS AG analyst Saud Masud. Dubai may also have to revert to specializing in trade and services, and drop its drive to become a regional banking center, said Ian Hay Davison, former chairman of the Dubai Financial Services Authority.
U.A.E. Central Bank Eases Liquidity After Dubai World Delay The United Arab Emirates’ central bank eased liquidity for lenders and said it “stands behind” the country’s local and foreign banks as they face losses from Dubai World’s possible default. Markets from Asia to the U.S. fell last week after Dubai World on Nov. 25 announced that it was seeking to delay loan repayments. Dubai’s stock markets will trade on Monday for the first time since the news. Banks will be able to borrow money from the central bank for half a percentage point above the three-month local benchmark interest rate, the Abu Dhabi-based regulator said in an e-mailed statement today.
Most U.S. Stocks Retreat on Concern Dubai Will Default on Debt Most U.S. stocks fell this week as speculation Dubai will default on its debt spurred concern that the recovery in the global financial system will stall, overshadowing fewer American jobless claims and more home sales. Morgan Stanley, Bank of America Corp. and Goldman Sachs Group Inc. lost more than 3.4 percent. They helped send financial institutions to the biggest drop among 10 industries in the Standard & Poor’s 500 Index after Dubai World, the state- controlled company with $59 billion of liabilities, said it’s seeking to delay debt payments. Alcoa Inc. slumped 3.6 percent as the Reuters/Jefferies CRB Index of commodities fell for the fourth time in five weeks.
Friday, Nov 27, 2009 NYSE Invokes Rule 48 in Anticipation of "Extreme" Volatility The NYSE hedged its bets earlier by invoking the rarely used Rule 48, which "provides the exchange with the ability to suspend the requirement to disseminate price indications and obtain floor-official approval prior to the opening when extremely high market-wide volatility could cause delay opening securities on the exchange." The full disclosure was made on the NYSE blog: Rule 48 is intended to be invoked only in those situations where the potential for extreme market volatility would likely impair floor-wide operations at the exchange by impeding the fair and orderly opening of securities. Accordingly, the rule sets forth a number of factors to be considered before declaring such a condition, including:
Volatility during the previous day's trading session;
Trading in foreign markets before the open;
Substantial activity in the futures market before the open;
The volume of pre-opening indications of interest;
Evidence of pre-opening significant order imbalances across the market;
Government announcements;
News and corporate events; and,
Any such other market conditions that could impact floor-wide trading conditions.
NYSE Circuit Breakers Levels for fourth-quarter 2009 In response to the market breaks in October 1987 and October 1989 the New York Stock Exchange instituted circuit breakers to reduce volatility and promote investor confidence. By implementing a pause in trading, investors are given time to assimilate incoming information and the ability to make informed choices during periods of high market volatility.
Rule 80B Effective April 15, 1998 the SEC approved amendments to Rule 80B (Trading Halts Due to Extraordinary Market Volatility) which revised the halt provisions and the circuit-breaker levels. The trigger levels for a market-wide trading halt were set at 10%, 20% and 30% of the DJIA, calculated at the beginning of each calendar quarter, using the average closing value of the DJIA for the prior month, thereby establishing specific point values for the quarter. Each trigger value is rounded to the nearest 50 points.
Applying Economics to American History
RBS Led Dubai World Lenders; HSBC Most at Risk in UAE Royal Bank of Scotland Group Plc was the biggest underwriter of loans to Dubai World, the state company seeking to reschedule debt, while HSBC Holdings Plc has the most at risk in the United Arab Emirates, according to JPMorgan Chase & Co. RBS, the largest U.K. government-controlled bank, arranged $2.3 billion, or 17 percent, of Dubai World loans since January 2007, JPMorgan said in a report today, citing Dealogic data. HSBC, Europe’s biggest bank, has the “largest absolute exposure” in the U.A.E. with $17 billion of loans in 2008, JPMorgan said, citing the Emirates Banks Association. Abu Dhabi Commercial Bank PJSC may be owed $1.9 billion by Dubai World, making it the largest creditor outside the emirate, said two people familiar with the companies.
Dubai Shows Limits of Government Rescues, Roubini’s Das Says The worldwide decline in equities spurred by Dubai’s efforts to reschedule its debt is a sign that government spending alone won’t be enough to protect financial markets, according to Arnab Das of Roubini Global Economics. Stock volatility will probably jump as countries and companies default on loans, said Das, the head of market research and strategy at RGE, the advisory firm founded by economist Nouriel Roubini.
Dubai Means Emerging Markets ‘Correction’ to Mobius Dubai’s attempt to reschedule debt may spur a “correction” in emerging markets, according to Mark Mobius, while the global slump in equities shows government spending alone won’t protect financial markets, Arnab Das of Roubini Global Economics said. Mobius, who oversees about $25 billion of developing-nation assets as chairman of Templeton Asset Management Ltd., said a 20 percent drop for shares is “quite possible.” Stock volatility and risk aversion may jump as countries and companies default on loans, according to Das, the head of market research and strategy at RGE, the advisory firm founded by Nouriel Roubini.
Dubai is just a harbinger of things to come for sovereign debt Watch out. This may be just the beginning. In the scale of things, the debt problems of Dubai are little more than a flea bite. Dubai’s sovereign debts total “just” $80bn, which counts for nothing against the trillions being raised by advanced economies to plug fiscal deficits. Small wonder, though, that this minor tremor has sent such shock waves around the wider capital markets. The fear is that threatened default in this tiny desert kingdom is just a harginger of things to come for government debt markets as a whole. According to new estimates by Moody’s, the credit rating agency, the total stock of sovereign debt worldwide will have risen by nearly 50 per cent between 2007 and 2010 to $15.3 trillion. The great bulk of this increase comes not from irrelevant little states like Dubai, but from the big advanced economies – America, Europe, and Japan.
India Studying Impact of Dubai’s Debt Delay Plan India, the world’s top recipient of migrant remittances, is examining the effect Dubai’s attempt to delay debt repayments may have on Asia’s third-largest economy, central bank Governor Duvvuri Subbarao said. About 4.5 million Indians live and work in the Gulf region and remit more than $10 billion annually, according to government data. The turmoil may affect remittances, said Thomas Issac, finance minister of the southern state of Kerala, which accounted for about a quarter India’s migrant labor in 2005.
Dubai's Dirty Little Secret
Gold Futures Drop, Halting Nine-Session Rally, as Dollar Gains Gold futures dropped in New York as the dollar’s rebound damped demand for the precious metal as an alternative asset. The greenback climbed after Dubai’s efforts to reschedule its debt rattled investors. Silver, platinum and palladium also dropped today. Spot gold reached a record yesterday, while the dollar touched a 15-month low. “The market is reacting to the news on Dubai,” said Bernard Sin, the head of currency and metals trading at bullion refiner MKS Finance SA in Geneva. “A dollar bounce likely means gold will sell off. People are trying to take profit.”
Will Silver Shine Like Gold in 2010? Anyone remotely familiar with the financial markets knows that precious metals were the place to be in 2009. Gold has soared to all time highs on the back of spiraling U.S. deficit spending, a still unresolved portfolio of toxic assets, and a general investor fear of paper currency. Indeed, it would seem the current administration’s hope would be to inflate the country out of debt. And thus, despite government denials to the contrary, a weaker dollar seems to be the logical solution to exploding debt. Thus, as the U.S. dollar continues to decline, Gold and it’s less glamorous cousin Silver, have continued to appreciate in price.
Is Britain on the brink of financial armageddon? He's one of our top entrepreneurs who recently put all his investments into cash. The reason: He believes Britain faces bankruptcy. You may disagree with his bleak analysis but you can't afford NOT to read it 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.
Euro, Australian Dollar Rise After U.A.E. Backs Dubai’s Banks The euro and the Australian dollar rose against the greenback and the yen after the United Arab Emirates’ central bank said it “stands behind” the country’s banks, easing concerns about a possible default by Dubai World. The U.S. dollar climbed against the yen for the first time in five days as a report showed retail sales on Black Friday and the weekend after Thanksgiving advanced 0.5 percent from a year earlier. The U.S. currency dropped 2.7 percent last week against the yen, the biggest weekly decline since the period to Aug. 14, as stock markets slumped after state-owned Dubai World sought to delay payments on debt. “The market is willing to assume that there will be no actual default in Dubai,” said Sean Callow, a strategist at Westpac Banking Corp. in Sydney. “We’re likely to get back to what everybody is most comfortable with, which is selling U.S. dollars.”
Bundesbank fears relapse as German banks face €90bn fresh losses The Bundesbank has told German banks to take advantage of renewed confidence while they can to prepare for likely losses of €90bn (£81bn) over the next year, warning that the delayed shock waves of the economic crisis still pose a major threat to global recovery and bank finance. The venerable bank said in its Stability Report that the world had narrowly averted a "virtually uncontrollable" collapse in the late summer of 2008. While the credit system has partly stabilised, the underlying problems "are still far from being overcome" and money markets are not yet functioning properly.
We must get ready for a weak-dollar world The two most significant structural consequences of the recent financial debacle are the massive deficits and debts of the US and the shift of economic power from west to east. There is only one effective way for governments to address the combined impact of both: press for a sea change in currency relationships, especially a permanently and greatly weakened dollar.
Which of the "Rich Four" Countries Will Default First? Volume in the credit default swap market for rich countries has soared and so have credit spreads, according to a recent Financial Times story, while volume in emerging markets CDS has stagnated. In other words, traders are betting against the governments with high budget deficits, like Britain and the United States, as well as against those with high debt levels, like Japan and Italy. So is there really a substantial chance of a big rich-country default, and what would it look like if it happened? It's not obvious which of the "Rich Four" countries would go first. Japan, for instance, has the highest debt. But Japanese consumers are such great savers that they essentially owe almost all of the debt to themselves.
Chinese credit tightening chills Asian markets China has stepped up efforts to halt the explosive growth in credit, ordering the country's five top banks to raise capital over coming weeks or face lending sanctions. The move amounts to monetary tightening in China's state-run banking system. The news triggered a sell-off on Asian stock markets and raised broader concerns about the strength of the global rally. The Shenzen index fell by 4.5pc on Wednesday. "For practical purposes, the recovery in risk assets since last winter is now over," said Charles Dumas, of Lombard Street Research. The China Banking Regulatory Commission reminded banks that they must set aside money to meet a capital adequacy ratio of 10pc and to cover 150pc of bad loans. New loans rose $1.3 trillion (£785m) in the first nine months of this year as Beijing mobilised banks as the main instrument of emergency stimulus.
IMF chief Dominique Strauss-Kahn says world needs stronger Chinese currencyDominique Strauss-Kahn, head of the International Monetary Fund, added to pressure on Beijing to let its currency rise, saying a stronger yuan and more Chinese consumer spending are needed to ease global economic imbalances and assure growth. His comments came as President Barack Obama began a visit to China amid strains over trade and currency. US manufacturers complain that Beijing gives its exporters an unfair price advantage by keeping the yuan undervalued, but Obama is expected to go easy on the issue. "A stronger currency is part of the package of necessary reforms," Mr Strauss-Kahn said in a speech at a finance conference in Beijing. He said China has started to make important reforms needed to raise domestic demand, such as increase spending on health care and pensions to free families to spend more on consumer goods.
Garlic Price Rises Surpass Gold, Stocks in China The price of garlic in China has nearly quadrupled since March, propelled by its very pungency to rank ahead of gold and stocks as the country's best-performing asset this year. The trigger for the bull run may have been the idea that the potent bulb can ward off H1N1 swine flu, Morgan Stanley economists said. That chimes with some anecdotal evidence. The China Daily reported last week that a high school in Hangzhou, a prosperous city in eastern China, had bought 200 kg of garlic and forced students to eat it every day for lunch to stay healthy.
Half of Banks' Losses May Still Be Hidden: IMF Head Half of the losses suffered by banks could still be hidden in their balance sheets, more so in Europe than in the United States, the International Monetary Fund's chief, Dominique Strauss-Kahn, was quoted as saying on Tuesday. In an interview with French newspaper Le Figaro, Strauss-Kahn also said the IMF thought the euro currency was probably a bit too strong. "There are still some important losses that have not been unveiled," Strauss-Kahn was quoted as saying in response to a question on banks, according to excerpts of the interview that were sent to media ahead of publication on Wednesday.
Whose side is Obama on? There is much to be thankful for this holiday, including the fact that we live in a country that has been remarkably good-natured, generous and pragmatic in the face of a nasty economic crisis. The rates of unemployment and under-employment have already hit a combined 17 percent. Household wealth has been significantly diminished. Reluctantly, we agreed to take on more public debt to finance a massive bailout of a financial sector that badly let us down. We stepped up our household savings and embraced the new frugality. What really sticks in our craw, however, is that while most of the country is hunkered down, Wall Street continues to feast on a bounty of trading profits. You'd expect that a new liberal Democratic president would find a way to give voice to this populist outrage and constructively channel this public anger. But too often, the response from the administration has been to try to convince us that there's little we can do, or should do, to ensure that the economic harvest is more equitably distributed. Now, the White House and congressional leaders find themselves scrambling to get ahead of a growing political backlash that threatens to upend their carefully calibrated agenda, not to mention their political fortunes.
Audit the Fed: Bernanke and the Bankers Are Running Scared Bernanke penned his tribute to central banking and globalism prior to his scheduled testimony before a Senate panel on his renomination to serve a second four-year term as Fed mob boss. Bankster tool Barney Frank, chairman of the House Financial Services Committee, tried to derail an effort to audit the Fed but failed. A proposal to audit the Fed's monetary policy deliberations won a committee vote recently over Frank's objections. In his Mockingbird media editorial, Bernanke "conceded the Fed had missed some of the riskiest behavior in the lead up to the crisis. But he said the Fed had helped avoid an even more damaging economic meltdown and has stepped up its policing of the financial system."
Fed rage boils over on Capitol Hill Fed chief Ben Bernanke is expected to win confirmation to a second term. But it won't be pretty. The push in Congress to rein in the central bank is gaining steam. Federal Reserve Chairman Ben Bernanke has a tough road ahead. Very tough. Bernanke, whose four-year term expires in January, is certain to face a contentious Senate banking panel at his confirmation hearing on Thursday. He is also defending against the sharpest attack on Federal Reserve powers ever. In an opinion piece to be published in Sunday's Washington Post, Bernanke blasted two moves to limit the Fed - a House measure to dig into the central bank's books and a Senate bill that would strip the Fed of its regulatory power.
Bernie Sanders: Bernanke Won't Get My Vote For Second Term (VIDEO) Sen. Bernie Sanders (I-Vt.) said Sunday that Fed Chairman Ben Bernanke would not get his vote for another five-year term. "I absolutely will not vote for Mr. Bernanke," the Vermont senator said on ABC's "This Week." "He's part of the problem. If he's the smartest guy in the world, why didn't he do anything to prevent us from sinking into this disaster that Wall Street caused and which he was a part of? No, I will not vote for Bernanke to stay on as chairman."
Bernanke Defends the Fed’s Independence This mornings must read work is an article in the Sunday Washington Post by none other than Ben Bernanke, titled The right reform for the Fed. It is a rational pushback against the like of Ron Paul and Chris Dodd’s programs to either hamstring or completely get rid of the Federal Reserve. As I have previously noted, being the only country with out a Central Bank would be like unilateral nuclear disarmament. Its a nice theory, but you will eventually be destroyed by your enemies.
Bernanke: Dodd, Paul Bills Would Hurt Economy Federal Reserve Chairman Ben Bernanke counterpunched against congressional critics, warning in a Washington Post opinion column that Capitol Hill efforts to audit the central bank and curtail its regulatory powers could be dangerous for the economy and fragile financial system. The House Financial Services committee earlier this month passed a controversial provision sponsored by Rep. Ron Paul (R., Tex.) that would subject the Fed to tougher scrutiny by the Government Accountability Office, an arm of Congress. Meanwhile, Senate Banking Committee Chairman Christopher Dodd (D., Conn.) has proposed a financial services reform package that would strip the Fed of most of its power to supervise banks.
As Bank Failures Grow, FDIC Options Narrow The Federal Deposit Insurance Corp. (FDIC) will likely have tap its credit line with the U.S. Treasury or impose more special premiums on banks, to ensure U.S. banks are fully supported. While FDIC-insured banks reported a net income of $2.8 billion in the third quarter, bank lending fell by 2.8%, the most since records were first kept in 1984 and the fifth consecutive quarter loan balances declined. The FDIC's Deposit Insurance Fund (DIF) went into the red at the end of September and the bank insurer today (Tuesday) revealed just how steep the loss it was when the quarter ended: $8.2 billion.
Economy still too weak to create jobs Friday's report should show 100,000 lost jobs in November, survey says The U.S. economy is slowly recovering, but it's still not strong enough to create any net jobs, economists said ahead of a busy week for economic news. The biggest report of the week will come on Friday morning with the Labor Department's estimate of November's employment situation. Economists surveyed by MarketWatch expect a 23rd consecutive month of job losses, with nonfarm payrolls forecast to fall by 100,000 after a 190,000 decline in October.
The Forgotten Depression of 1920 It is a cliché that if we do not study the past we are condemned to repeat it. Almost equally certain, however, is that if there are lessons to be learned from an historical episode, the political class will draw all the wrong ones — and often deliberately so. Far from viewing the past as a potential source of wisdom and insight, political regimes have a habit of employing history as an ideological weapon, to be distorted and manipulated in the service of present-day ambitions. That's what Winston Churchill meant when he described the history of the Soviet Union as "unpredictable."
Just In Time for Holidays: More Gloom and Doom on Economy Just in time for the holidays: More gloom and doom from a well-known economist. David Rosenberg, who used to be Merrill Lynch's chief economist and now works for Gluskin Sheff of Canada, told CNBC Tuesday that the US economy is mired in an economic crisis that shows only scant signs of abating. "We're in a form of Depression," Rosenberg said in a live interview. "Depressions...typically happen after a prolonged period of credit excess morphs into a collapse and you get asset deflation. We had asset deflation and we had a contraction in private-sector credit."
Thanksgiving Weekend Sales Rise 0.5%, Driven by Deals U.S. retail sales on Black Friday and the weekend after Thanksgiving advanced 0.5 percent as discounts on electronics and toys drew budget-conscious crowds, according to the National Retail Federation. Spending rose to $41.2 billion from $41 billion a year earlier, the Washington-based trade group said in a statement today, citing a survey conducted by polling firm BIGresearch. NRF said it is sticking to a forecast for spending to fall 1 percent this season. While more people visited stores and Web sites, the average shopper spent $343.31, less than $372.57 a year ago, the retail federation said.
Black Friday sales barely up CHICAGO - IN A worrisome sign for US retailers, data released on Saturday showed that sales rose a scant 0.5 per cent on the traditional kickoff to the holiday shopping season despite early signs of a strong showing. A focus on bargains pulled US shoppers into stores and onto websites over the Thanksgiving holiday weekend, but many said they would stick to their budgets and avoid purchases if they could not find a good deal. Those trends appeared to play out in the results issued by ShopperTrak, which measures customer traffic in stores.
U.S. sitting on $17 billion in unclaimed war bonds MANY REQUESTS FOR REPAYMENT Matching claimants to certificates a mighty task The seemingly endless stacks of filing cabinets inside a West Virginia warehouse could hold the answer to an unsolved mystery: Who owns nearly $17 billion in lost government bonds? The unclaimed treasure represents the amount of U.S. bonds that have matured but not been redeemed. Many of these outstanding bonds date to World War II, but over the years the certificates were forgotten in cellars, lost in fires or tossed out in the trash. Unless they are found, the U.S. government can keep the loans, interest free. In the wake of publicity surrounding a lawsuit on the missing bonds earlier this fall, the government has been deluged with requests from people wondering whether they are entitled to repayment.
At last, Christians draw a line in the sand against their PC secularist persecutors At long last, Christian leaders have faced up to their persecutors in the secularist, socialist, One-World, PC, UN-promoted axis of evil and said: No more. In the popular metaphor, they have drawn a line in the sand. For harassed, demoralised faithful in the pews it will come as the long-awaited call to resistance and an earnest that their leaders are no longer willing to lie down supinely to be run over by the anti-Christian juggernaut. This statement of principle and intent is called The Manhattan Declaration, published last Friday in Washington DC. . . . The Manhattan Declaration states that "the lives of the unborn, the disabled, and the elderly are severely threatened; that the institution of marriage, already buffeted by promiscuity, infidelity and divorce, is in jeopardy of being redefined to accommodate fashionable ideologies; that freedom of religion and the rights of conscience are gravely jeopardized by those who would use the instruments of coercion to compel persons of faith to compromise their deepest convictions". For Barack Obama, the PC lobby, the "hate crime" fascists and, by implication, their opposite numbers in Britain, the signatories have an uncompromising message: "We pledge to each other, and to our fellow believers, that no power on earth, be it cultural or political, will intimidate us into silence or acquiescence." That is plain speaking, in the face of anti-Christian aggression by governments. The signatories spelled it out even more unequivocally: "We will fully and ungrudgingly render to Caesar what is Caesar's, but we will under no circumstances render to Caesar what is God's."
Food banks nationwide report more first timers Prentice Jones worked construction jobs around Chicago for most of his 60 years and is quick to boast of a foreman job he once held at a revamped city college and 23 years at a steel company. But these days, work has been so scarce that the man with a penchant for cowboy hats has been forced to move in with his mother and do something this week he never expected — visit a food pantry. "There's no work now," Jones said while waiting in line at St. Columbanus Parish for a frozen turkey and bags of apples, bread and potatoes. "I pray it's temporary."
From the Hospital to Bankruptcy Court NASHVILLE - Some of the debtors sitting forlornly in this city's old stone bankruptcy court have lost a job or gotten divorced. Others have been summoned to face their creditors because they spent mindlessly beyond their means. But all too often these days, they are there merely because they, or their children, got sick. Wes and Katie Covington, from Smyrna, Tenn., were already in debt from a round of fertility treatments when complications with her pregnancy and surgery on his knee left them with unmanageable bills. For Christine L. Phillips of Nashville, it was a $10,000 trip to the emergency room after a car wreck, on the heels of costly operations to remove a cyst and repair a damaged nerve. Jodie and Charlie Mullins of Dickson, Tenn., were making ends meet on his patrolman's salary until she developed debilitating back pain that required spinal surgery and forced her to quit nursing school. As with many medical bankruptcies, they had health insurance but their policy had a $3,000 deductible and, to their surprise, covered only 80 percent of their costs.
Democrats expect healthcare overhaul to pass Leading Democrats on Sunday said they expect Congress to pass a major healthcare reform backed by President Barack Obama, but supporters may have to accept legislation that falls short on some issues. The U.S. Senate on Monday is set to begin debate on the sweeping overhaul of the $2.5 trillion U.S. healthcare system amid growing concerns about the cost of the legislation that aims to provide medical coverage for millions of the uninsured.
11/25/09 (1/2) Ron Paul on Montel Williams Radio Show
11/25/09 (2/2) Ron Paul on Montel Williams Radio Show
We Pay Them to Lie to Us The problem with politicians When you knowingly pay someone to lie to you, we call the deceiver an illusionist or a magician. When you unwittingly pay someone to do the same thing, I call him a politician. President Obama insists that health care "reform" not "add a dime" to the budget deficit, which daily grows to ever more frightening levels. So the House-passed bill and the one the Senate now deliberates both claim to cost less than $900 billion. Somehow "$900 billion over 10 years" has been decreed to be a magical figure that will not increase the deficit.
Professors: More homeowners should walk away from loans More homeowners should walk away from their underwater mortgages. That is the conclusion of a University of Arizona law professor who says many distressed borrowers are sticking with their loans because of societal expectations, while banks are focused on profits rather than societal good. UA law professor Brent White writes in a new report that the government and banks pressure homeowners to stick with their underwater mortgages, but lenders are not abiding by the same rules. White said most homeowners don't abandon their homes despite owing more than they are worth because it is perceived as failure and would hurt their credit scores.
Obama to push banks on mortgages Administration plan aims to address emerging problem: Only a handful of homeowners are receiving permanent loan modifications. As foreclosure casualties mount, the Obama administration is expected to announce additional steps on Monday to get long-term help for troubled borrowers. Under the new initiative, the government will provide more resources for borrowers and will partner with organizations to offer homeowners assistance, a Treasury Department spokeswoman said. The plan also calls for increased transparency and accountability on the part of loan servicers. The administration's move is its latest attempt to jumpstart its $75 billion loan modification plan, which many fear will fall far short of its goal to help up to 4 million delinquent homeowners.
Bankruptcies spike 33% Number of bankruptcy filings in third quarter of 2009 soars to highest level since 2005. Business bankruptcies filed this year top 2008 total. The total number of bankruptcies filed in the third quarter surged 33% in 2009 and is at the highest level since 2005, according to data released Wednesday. The American Bankruptcy Institute, an industry research firm, said 388,485 bankruptcies were filed during the last quarter, compared to 292,291 filed during the same period in 2008, according to data released by the Administrative Office of the U.S. Courts.
****** Could this become a trend? *******
Judge Erases Couple's $525,000 Mortgage Payment A Long Island, NY, judge cancelled $525,000 in mortgage payments being demanded by California bank OneWest and its IndyMac mortgage division, criticizing its "harsh, repugnant, shocking and repulsive" behavior, the New York Post reported Wednesday. The ruling, which was delivered last Thursday, eliminated $291,000 in principal and $235,000 in interest and penalties on Diane Yano-Horoski and husband Greg Horoski's ranch home. According to court records, the couple refinanced their home in 2004, paying off the original mortgage with the help of a $292,500 subprime loan, the Post said. It had an adjustable interest rate of 10.375 percent, which rose above 12 percent.
Property Owners Get Dunked On Another victory for the powerful over property rights. New York judges served up what basketball fans call a facial on Tuesday, when an appellate court ruled that the state may seize homes and small businesses in Brooklyn for the benefit of a private developer and the New Jersey Nets. The decision represents a backward step for the effort to protect property rights at the state level since the Supreme Court's 2005 decision in Kelo v. New London. The case, Goldstein v. New York State Urban Development Corporation, dealt with plans by developer Forest City Ratner to build a new arena for the Nets as well as snazzy apartments and offices on land currently occupied by homes and businesses. To make way for the sports complex, the state declared the property "blighted" and used its power of eminent domain to hand it to the developer.
Iran Approves Plans for 10 Uranium Enrichment Sites Iran announced a major expansion of its nuclear program on Sunday and threatened to pull out of the Non-Proliferation Treaty, a move that could dramatically escalate the country's standoff with the international community. President Mahmoud Ahmadinejad revealed in a cabinet meeting on Sunday plans to build 10 more nuclear facilities for enriching uranium, according to Iran's official news agency IRNA. The facilities would eventually produce enough nuclear fuel to meet the country's demand for 20,000 megawatts of nuclear energy by 2020.
A Defiant Iran Details Plan for 10 Enrichment Plants Iran warned Sunday that it would reduce its cooperation with United Nation’s nuclear agency and in a gesture of defiance it ordered the construction of 10 new uranium enrichment plants. Iran’s warning and its announcement for building new plants appeared to be its first reaction to the demand by the United Nations nuclear watchdog demand on Friday to immediately suspend enrichment activities at a newly disclosed site called Fordow, near the city of Qum. Iran had told the agency that it planned to complete the half-built plant, which is tunneled into the side of mountain, by 2011.
Rigging a Climate 'Consensus' About those emails and 'peer revie The climatologists at the center of the leaked email and document scandal have taken the line that it is all much ado about nothing. Yes, the wording of their messages was unfortunate, but they insist this in no way undermines the underlying science. They're ignoring the damage they've done to public confidence in the arbiters of climate science. "What they've done is search through stolen personal emails—confidential between colleagues who often speak in a language they understand and is often foreign to the outside world," Penn State's Michael Mann told Reuters Wednesday. Mr. Mann added that this has made "something innocent into something nefarious."
Commonwealth Calls for Binding Climate Agreement Leaders of the Commonwealth countries called Saturday for a legally binding international agreement on climate change and a global fund with billions of dollars to help poor countries meet its mandates. The 53-nation meeting was the largest gathering of international leaders before next month's global climate summit in Copenhagen. The leaders said a deal should be adopted no later than next year and the support money should be available simultaneously, providing up to $10 billion a year starting in 2012.
Obama faces hard sell on Afghan decision President Obama will attempt to persuade the American public this week that more time, troops and money will accomplish what eight years of effort and every outside power in history have failed to achieve - a measure of military success in Afghanistan. The details and justification for Mr. Obama's new war policy will be the focus of a major address at the U.S. Military Academy at West Point, N.Y., on Tuesday.
Obama to announce Afghan troops plan Barack Obama is seeking to win over his own Democratic party as he prepares to announce a troop increase in Afghanistan in perhaps the biggest decision of his presidency to date. In a speech to cadets and officers at the West Point academy on Tuesday evening, Mr Obama is due to authorise the dispatch of a brigade of 9,000 or more marines to the south of Afghanistan, as well as announcing the deployment of accompanying army brigades. The president will have to overcome considerable suspicions within the ranks of his own party about the new course, which could affect his re-election hopes as well as America’s standing in the world.
Pakistan must do more to tackle Al Qaeda and 'take out' Osama Bin Laden, says Brown Report for Senate reveals Bin Laden was within grasp of U.S.but chiefs ordered military not to swoop Gordon Brown sent a tough challenge to Pakistan today to step up action against the Al Qaeda and 'take out' its leaders Osama bin Laden and Ayman Zawahiri. The Prime Minister made little attempt to hide his frustration at Pakistan's failure, eight years after the September 11 attacks in the USA, to track down the men responsible, who are believed to be hiding out in the north of the country.
Trouble afoot for high priests [of global warming] Can this marriage be saved? The union of junk scientists, on the prowl for government handouts to pay for their computer games, and eager politicians sniffing an enormous new source of tax revenue was a match made in a dark alley. The always gullible mainstream media was the guest at the wedding, and everybody won. Only the public was duped. The global warming scam is in trouble because neither the globe nor the thermometer will cooperate. Congress is trying to decide whether to believe its own eyes or the hustlers who have been forced to change the name of the scam - we're supposed to call it "climate change" now. The marketing men hired by Al Gore to "re-brand" the scam looked for inspiration to the country philosopher who observed that "if you've got one foot in the fire and the other foot in a bucket of ice, on average you're warm." The term "climate change" strikes a fraudulent average that can be applied to ice storms, heat waves, hurricanes and floods. Since the climate changes constantly, the new "brand" ought to last awhile.
Obama Will Go to Copenhagen President Obama will travel to Copenhagen next month for the United Nations meeting on climate change, a White House official confirmed Wednesday. Mr. Obama, who had previously not committed to making an appearance at the summit, will deliver a speech on Dec. 9 en route to Oslo, Norway, where he will accept the Nobel Peace Prize on Dec. 10. Mr. Obama had been under considerable pressure from other world leaders and environmental advocates to make the trip as a statement of American commitment to the climate change negotiations. The talks, involving more than 190 nations, are expected to produce a wide-ranging interim political declaration but stop short of proposing a binding international treaty. Delegates are expected to commit to completing the treaty next year.
- - - - - - - - - - - - - - - - Archived Page Link
- - - - - - - - - - - - - - - -
RSS
![[Most Recent Quotes from www.kitco.com]](http://www.kitconet.com/images/quotes_7a.gif)