Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.
Fri 01.01.2010
Happy New Year, 2010!!
The Top Business Stories of 2009 It was a year of historic change in business, economics, and finance. General Motors and Chrysler made whirlwind trips through the bankruptcy process, and the U.S. Senate narrowly voted in favor of health care reform in a dramatic vote on Christmas Eve morning, bringing President Obama just this close to achieving a top campaign priority. In other times, any one of these sagas might have been an obvious and easy selection as the business story of the year. Yet 2009 was so full of drama that health care reform will have to settle for a position on the short list, and Chrysler might not have made the list at all if it hadn't been paired with GM.
2010 could be a year that sparks unrest IF THE world appears to have escaped relatively unscathed by social unrest in 2009, despite suffering the worst recession since the 1930s, it might just prove the lull before the storm. Despite a tentative global recovery, for many people around the world economic and social conditions will continue to deteriorate in 2010. An estimated 60m people worldwide will lose their jobs. Poverty rates will continue to rise, with 200m people at risk of joining the ranks of those living on less than $2 a day. But poverty alone does not spark unrest-exaggerated income inequalities, poor governance, lack of social provision and ethnic tensions are all elements of the brew that foments unrest.
2010: Walking away will gain cachet Why bother? That’s the question more underwater Americans are asking themselves about their mortgage. Trapped in the abyss of negative equity, more will decide to quit paying. As they should. About a quarter of all mortgages in the United States are on houses that are worth less than the unpaid balance of the mortgage, according to real estate consultant First American CoreLogic. About half of that group, 5.3 million borrowers, are 20 percent or more underwater. For 2.2 million, the property is worth less than half the mortgage balance. Those folks are called “homeowners,” but “homeborrowers” would be more accurate. All they own is an obligation to whatever entity services their mortgage. They’re essentially renters paying above-market prices.
12/29/09 Gerald Celente on Fox Business: 2010 Market Trends
The Shape Shifters of 2009 Columnist Suzanne McGee looks beyond the headlines to find a baker's dozen of people who are shaping Wall Street. It's that time of year again-time to step back and try and assess the last 12 months and think ahead to what awaits us in 2010. In that spirit, the final StreetWise column of 2009 takes a look at a baker's dozen of Wall Street (or quasi-Wall Street) figures who represent some important trend or issue during the year. It's not a list of the most influential people on Wall Street, of those with the biggest bonuses or most awe-inspiring titles. Rather, they're involved in something interesting and potentially transformative. Perhaps they are running a new business or tackling a new job. Or they could, like Lloyd Blankfein, simply be trying to return as rapidly as possible to "business as usual." This isn't intended to be a definitive list, but rather a starting point for debate and discussion about the most significant themes of 2009 on Wall Street and what may lie ahead. Happy New Year!
December 30 2009: The Year for Plan B Ilargi: The major difference between Tim Geithner and me, apart from my obviously superior looks, is that he is willing to gamble double or nothing with your money and your lives, and I would not be. Or, as one might also put it, he thinks the risk of misery for millions of American people is less important than his own personal career. I do not. Other than that, when it comes to the way he defines his policy decisions, there are no differences that matter, not his experience in guiding the New York Fed, or his palliness with the likes of Bob Rubin and other self-ordained rulers of the realm, nor all the inside knowledge that comes with that. The reason none of it matters is that Geithner doesn't know what he's doing.
Keys to Next Year: Stimulus, Employment As the 2009 ledger is tallied and closed, investors, consumers, business owners and traders await the arrival of 2010 with a mix of trepidation and optimism. Just more than a year removed from the near collapse of the U.S. financial markets, economists say 2010 will bring more stability, but joblessness will remain a major obstacle to full recovery. With unemployment topping10% and little hiring on the horizon, Main Street will remain cautious “We think the unemployment rate is going to keep rising through next summer, peaking at 10.6%,” said Marisa DiNatale of Moody’s Economy.com. “We think the extent of unemployment is the greatest risk to recovery.”
The Great Recession: A Hidden Depression? The story of the Great Depression is often told in pictures: while few people recognize the names "Smoot-Hawley" or "Schechter Poultry," photographs of bank runs and bread lines continue to pack a punch, almost 80 years after they were first snapped. But the Great Depression's position as our absolute standard for economic disaster carries an unintended consequence: The power of its images seem to overwhelm -- and minimize -- the economic troubles of our own time. After all, if it doesn't look like a Depression, how tough could things be?
Economic Disasters Need Taxpayer Support It’s one of those days. Reading the financial press is a delight; the big challenge is deciding what to laugh at first. Take your choice. There’s Martin Wolf, writing in The Financial Times, with a claim that is so staggeringly conceited, the gods must have marked him for punishment before the ink was dry. He thinks economists should be thanked, not merely for saving the world economy…but for saving civilization itself. We will come back to this later…after we’ve had a chance to catch our breath.
Peter Schiff With Charles Payne 1 Of 3 12_28_09
One Lie After Another Sometimes, you can overlook something that is right in front of you. That just happened with me. I'm talking about something I should have seen before now in silver and gold. A year and a half ago, the Commodity Futures Trading Commission (CFTC) published a 16 page public report denying there was any manipulation in the silver market, due to concentration by large short traders on the COMEX. The report, issued on May 13, 2008, by the agency's Division of Market Oversight (DMO) went into painstaking detail about how the short concentration in silver was no big deal. Certainly, the title, "Report on Large Short Trader Activity in the Silver Futures Market" is very straight forward. Here's the report - http://www.cftc.gov/ucm/groups/public
The Economy and 2010: What is your Resolution? With the recent unexpected drop in jobless claims, an uptick in consumer spending and New Year mirth, you might expect that recovery is truly in the wings. Saner voices still ring the bell of reality. The U.S. Government and many others focus on percentages, which don’t paint the real picture at all. Just look at the unemployment situation on a month-to-month basis in the U.S. and what this really means for Americans and you will begin to get a clearer picture of economic reality beyond having millions of Americans use their credit cards for a month to spur the illusion of economic growth. Nobel laureate economist, Joseph Stiglitz says that the U.S. economy will be permanently stunted if the government doesn't do much more to create jobs and to invest in the nation's potential.
Bubble-onomics: 10 Predictions for 2010 This analysis has got nothing to do with the much loved but now sometimes tarnished financial//economic theories that were so popular until mid-2008. Just some weird ideas for how market bubbles work; with roots somewhere between Entomology and International Valuation Standards. Some of the ideas were looked at by George Soros in his book on “Reflexivity” published in 1987 and in Bob Farrell’s “10 Market Laws” published in 1992. The first “hard” prediction that used this approach was made in January 2009 (“S&P 500 will turn at 675”), followed by one in February 2009 (“When it hits 675 Jump In!”), since then the approach has been used with varying degrees of success to predict the inflection points for oil, gold, treasuries, toxic assets, housing, and the Shanghai Index.
Can I sell gold at $5,000 in 2010? Happy New Year! 2009 will be remembered as an exceptional year for commodities. The commodities bull run this year has been fueled by gold, platinum, garlic and turmeric. Gold emerged as the singular driver that pushed the boom in commodities. Gold, gold, gold…everywhere we hear and read about the glistering yellow metal. As the year draws to a close, it is celebration time for gold scrap sellers as the yellow metal they bought for $700 per ounce an year back is worth $1100 now. That is a huge return that common people, investors and traders are lured to buy more and more gold.
Gold rallies as dollar eases, heads for 9th annual gain Gold rallied on Thursday, helped by a weaker U.S. dollar, a factor that has helped propel gold to a record high earlier this month and its ninth annual gain in as many years. The gain reversed a slide in bullion prices on Wednesday, when investors ditched gold as the dollar .DXY advanced on positive outlooks for U.S. business activity and housing. With gold looking to end the year up by around a quarter, investors will turn to the prospects for 2010, which are likely to largely hinge on how quickly the U.S. Federal Reserve moves to tighten monetary policy.
Gold Inches Higher, Ending Banner Year For the ninth straight year, the yellow metal will have increased in value as investors keep on buying, motivated by a widely held fear of impending inflation and a belief that the Federal Reserve, anxious to nurse a delicate economic recovery, will leave interest rates at historically low levels for as long as it can. In mild pre-holiday trading New Year's Eve, U.S. equities declined slightly, while the U.S. dollar index was slipping 0.04%. Gold, meanwhile, ended a two-day losing streak, bouncing $3.40 to $1,095.90 an ounce on the Comex division of the New York Mercantile Exchange.
Gold stays positive as greenback pares early losses YEAR-END position squaring enabled gold futures to hold onto some of their gains yesterday even as the dollar recovered most of its early weakness. Lightly traded but nearby January gold rose $US3.70 to $US1095.20 an ounce on the Comex division of the New York Mercantile Exchange, while most-active February climbed $US3.70 to $US1096.20. Most-active March silver rose US4.3 cents to $US16.845. Gold opened the session higher with the ICE Futures US March dollar index on the defensive, hurt in part by a survey showing a rise in UK house prices last month. Investors often buy the metal as a hedge against US dollar weakness.
Gold Ends 2009 With 25 Pct Return Gold prices sealed their biggest absolute annual gain in three decades with a small advance on Thursday, rising for an unprecedented ninth year in a row after dollar-hedging traders and central banks joined investors who turned to gold for price performance and protection. Bullion rose slightly as the dollar ebbed and oil climbed as high as $80 a barrel. Palladium jumped sharply to notch a record 119 percent return this year, bolstered by improving industrial demand and anticipation of more investment with the launch of a new U.S. exchange traded fund next year.
China's 2010 Gold Rush THE COLLAPSE in India's gold demand during 2007-09 might seem good reason to question the fundamental strength of gold buying worldwide. After all, if the world's No.1 gold buyers can't keep up with record-high gold prices, who can...? But the plain fact, as BullionVault first forecast in spring 2009, is that China has overtaken India as the number one private gold buyer this year. The typical Chinese New Year gold rush has already begun (thanks in part to 3% discounts at major retailers), and robust demand looks likely to continue through 2010 if not beyond.
Gold Climbs, Capping Ninth Annual Gain, on Currency Outlook Gold futures rose, capping the ninth straight annual gain, on speculation that the dollar will extend a slump, spurring demand for the metal as an alternative investment. Silver had the biggest yearly increase since 1979. Gold advanced 24 percent this year as government spending aimed at reviving the U.S. economy sent the dollar down 4.2 percent against a basket of six major currencies. The metal rose to a record $1,227.50 an ounce on Dec. 3 and also reached all- time highs based in sterling and euros.
Peter Schiff With Charles Payne 2 Of 3 12_28_09
Jim Sinclair - A markets bear, but gold bull, crying in the wilderness Jim Sinclair can't find a markets bear anywhere and that rings warning bells! Jim Sinclair, a much respected and followed bull on the gold price, despairs of the analysts predicting a stock market boom in 2010. In a note yesterday Sinclair says "As we approach the New Year it seems the party has already begun, and the commentators are all full of spirits. I can't find a bear in the woods." "According to them the equity market is going up, the dollar is going up, commodities are going up, and even lip service is being paid to gold, but lip service only. The conviction being blasted out there is a line up of former pro-gold guys like Faber and Rogers. Today they rolled out Barton Biggs for his bullish equity-bullish dollar forecast. Soros and Buffett have already made their contribution to a dollar rally."
Gold prices will make history in 2010 With the gold price at $1,100 dollar per ounce in late 2009, gold investors are likely to increase purchases, creating a new cycle of price increase. The greenback is depreciating in the eyes of investors and the price of the dollar and gold always go in opposite directions. Central banks of the world have realized the need to diversify asset reserves in anticipation of the depreciation of the dollar and higher inflation, which will promote gold purchases by banks.
How China overtook India in gold consumption The collapse of Indian gold demand since the global financial crisis broke in 2007 might seem good reason to question the fundamental strength of gold buying worldwide today. After all, if the world's No.1 gold buyers can't keep up with record-high Gold Prices, who can...? But the plain fact, as BullionVault first forecast in spring 2009, is that China has overtaken India as the number one private gold buyer this year. The typical Chinese New Year gold rush has already begun (thanks in part to 3% discounts at major retailers), and robust demand looks likely to continue through 2010 if not beyond.
Will IMF part with its gold on George Soros plan? In 2009, what was the most interesting and valuable proposal from billionaire global investor George Soros? Soros made a passionate plea for clean tech sector, saying that the International Monetary Fund (IMF) should part with its gold reserves to promote carbon cutting projects in the developing countries. George Soros' comments have invited criticism and applause. But will his suggestion that IMF should dispose of some $100 billion out of its gold reserves to spend on green loans in carbon-cutting projects to the developing countries come true in 2010?
Jim Rogers on gold, dollar, commodities in 2009 It is the time of the year, when you love to recollect what others said on things you like and dislike. And on commodities, what better voice to listen to than that of Jim Rogers, the global investing guru on commodities. Rogers' views on gold, silver, platinum, palladium, dollar, pound and agricultural commodities were the most resounding during the whole of 2009. Rogers, chairman of Rogers Holdings, and a vocal critic of America and Britain, has been arguing all through 2009 that agricultural commodities are the best investment place to put your money.
Dollar Bulls Bushwhack Foreign Currencies The non-dollar currencies got bushwhacked yesterday by the dollar bulls around mid-day, and there’s been no recovery since. The Treasury is back at the auction table, with $32 billion in 7-year Treasuries for you to buy at the fantabulous yield of…. Drum roll please…. 2.60%! All that and more, so buckle yourself in, and make certain to keep your arms and legs inside the Pfennig at all times during the ride!
Camaraderie of the Damned There is not a lot of action in the markets. Most of the investment world is home for the holidays… At least, the investors are home. The pros – the bankers, for example – are celebrating the holidays in fancy resorts. They can afford it. It was a great year for the financial sector. After nearly going broke because of their reckless speculations, the bankers took money from the feds and went on to speculate some more…making huge profits. Bonuses for many of them were better than ever.
Peter Schiff With Charles Payne 3 Of 3 12_28_09
Commodities Post Biggest Annual Gain in Four Decades on China Commodities posted the biggest annual gain in four decades, led by a doubling in copper, sugar and lead prices, as Chinese demand compensated for the longest slump in the global economy since World War II. In 2009, the S&P GSCI Index of 24 raw materials rose 50 percent, the most since at least 1971, and commodities drew record investment of $60 billion this year, Barclays Capital estimated. This year, the MSCI World Index of stocks in 23 developed nations climbed 27 percent, and U.S. Treasuries fell 3.5 percent, according to Bank of America Merrill Lynch indexes.
Why the Federal reserve wants to drain excess reserves I wrote a post yesterday (The Fed's exit strategy) to explain the mechanics surrounding Monday's Federal Reserve announcement that it is offering CD accounts to banks. The Federal Reserve does not control the demand for credit and therefore cannot increase aggregate demand by increasing bank reserves. This is an important point because it colors how you view the potential for inflation as a result of Fed action. I see little need for immediate inflation concerns because there is huge amounts of excess capacity.
Support grows for tackling nation's debt Senate action late last week that increased the limit on the government's credit card to a record $12.4 trillion gave a significant boost to a proposal to appoint a special commission to make the tough decisions that will be required to dig the nation out of debt. President Obama has voiced support for such a plan, and 35 Democratic and Republican senators have signed on to legislation that would create a bipartisan commission with broad power to force painful spending cuts and tax increases through Congress.
Money printing scheme is working, Bank of England says Lending to households and businesses continued to pick up in the final three months of last year and is expected to rise further in the coming months, the Bank of England said yesterday, boosting hopes that its scheme of quantitative easing is working. The Bank’s latest quarterly Credit Conditions Survey, which asks lenders about credit conditions over the past three months, showed that the availability of credit to businesses rose for the fourth consecutive quarter between October and December, while the availability of mortgages rose after falling in the third quarter.
Treasury makes the last bailouts, $29M to 10 banks The Treasury Department said Thursday it has pumped $29.3 million into 10 banks, the last to receive investments as part of the taxpayer-funded program to shore up the financial system. The aid comes from a $700 billion financial bailout program created last year during the height of the financial crisis. The investments in the 10 banks are the last under Treasury's so-called Capital Purchase Program, Treasury officials said. By law, the Treasury must report the transactions — which occurred on Tuesday — within two business days.
1/3 Gerald Celente top 10 Predictions for 2010! StopTheRobbery.com
Huffington to consumers: boycott big banks There can be few institutions more despised as 2010 begins than big U.S. banks, but what can the average person do about it? The answer, according to Huffington Post website founder Arianna Huffington and former Senate Banking Committee chief economist Rob Johnson: Withdraw your money. In a widely read blog post this week,Huffington and Johnson try to stir up a popular revolt by encouraging bank customers to yank their deposits from Bank of America, Wells Fargo, Chase and Citibank and move them to community banks and credit unions.
Why Did They Close WaMu? Washington Mutual had enough money to survive. So why did regulators shut the thrift down in one of the biggest bank takeovers in history? On a sunny Sunday afternoon in late September, a year and two days after regulators closed Washington Mutual, the bank's former leaders gathered for an improbable, and tragic, reunion at a Seattle restaurant. Among those present: Lou Pepper, the CEO who guided WaMu through the 1980s, and Kerry Killinger, the CEO who presided over both its vast expansion in the 1990s and its later deep dive into risky mortgage lending.
FDIC plans to seek stakes in buyers of failed banks The agency hopes to recoup the costs of closing lenders by sharing in any profits from an increase in the buyer's stock after a takeover. The Federal Deposit Insurance Corp. plans to seek stakes in the companies bidding for seized banks, aiming to gain when the shares rise and helping recoup the costs of closing lenders. The arrangement would let the agency share any profits from an increase in the buyer's stock after a takeover, said James Wigand, the FDIC's deputy director of resolutions and receiverships.
Mortgage Bond Rally May End, Rates Rise as Fed Stops Purchases Mortgage bonds are poised to slump after a record rally as the Federal Reserve’s unprecedented buying of $1.25 trillion of the securities ends as soon as March, driving up interest rates on new home loans. Analysts at BNP Paribas SA, Credit Suisse Group AG and JPMorgan Chase & Co. say the extra yield over benchmark rates that investors demand to hold the securities will widen as much as half a percentage point as the Fed stops purchasing. The 11- month-old program has reduced yields, which guide lending rates, by about 1 percentage point, BNP estimates.
U.S. in fiscal peril with $12.1 trillion debt After $787 billion in stimulus spending and $700 billion in bank bailouts, 2010 is fast shaping up to be the year of the federal budget diet. Bipartisan support is growing in Congress for action to stabilize the nation's bulging debt, which is now $12.1 trillion. Influential experts from former Federal Reserve Board chairman Alan Greenspan to former comptroller general David Walker have joined the cause.
Cybercrooks stalk small businesses that bank online A rising swarm of cyber-robberies targeting small firms, local governments, school districts, churches and non-profits has prompted an extraordinary warning. The American Bankers Association and the FBI are advising small and midsize businesses that conduct financial transactions over the Internet to dedicate a separate PC used exclusively for online banking. The reason: Cybergangs have inundated the Internet with "banking Trojans" — malicious programs that enable them to surreptitiously access and manipulate online accounts. A dedicated PC that's never used for e-mail or Web browsing is much less likely to encounter a banking Trojan.
Neel Kashkari’s Quiet Path to Pimco The financial crisis did not produce many stars. One of the few was Neel T. Kashkari, the former Bush administration bailout chief. A onetime investment banker at Goldman Sachs, Mr. Kashkari became an instant celebrity in October 2008 when he was tapped by Henry M. Paulson Jr., then the Treasury secretary, to run the Troubled Asset Relief Program for banks. He was christened “the $700 billion man” for overseeing such a huge amount of banking aid.
2/3 Gerald Celente top 10 Predictions for 2010! StopTheRobbery.com
Congress lets 50 tax breaks expire at end of ’09 Many likely to be revived sometime in 2010 — but it’s a pain for taxpayers When members of the U.S. Senate went home earlier this month, they left the future of 50 individual and business tax breaks in limbo. All expire at the end of 2009. Among the disappearing breaks are the research tax credit and an annual alternative minimum tax "patch," which keeps 23 million additional middle-income Americans from being forced into calculating and paying the dreaded AMT. (For 2009, with the patch in place, 4 million upper-middle- and high-income families will pay AMT.)
China Property Bubble May Lead to U.S.-Style Real Estate Slump Li Nan has real estate fever. A 27- year-old steel trader at China Minmetals, a state-owned commodities company, Li lives with his parents in a cramped 700- square-foot apartment in west Beijing. Li originally planned to buy his own place when he got married, but after watching Beijing real estate prices soar, he has been spending all his free time searching for an apartment. If he finds the right place -- preferably a two-bedroom in the historic Dongcheng quarter, near the city center -- he hopes to buy immediately. Act now, he figures, or live with Mom and Dad forever. In the last 12 months such apartments have doubled or tripled in price, to about $400 per square foot.
How Commercial Real Estate Could Trigger a Double-Dip Reports that commercial real estate (CRE) is suffering from a double whammy of soaring vacancies and declining valuations have been making news recently with sobering regularity. DailyFinance addressed the risks that CRE meltdowns pose to banks in early December. And in a stunning confirmation, just weeks later Morgan Stanley announced it was "walking away" from five San Francisco office towers, giving them back to the lenders. These accounts address the impacts on real estate investors, banks and hard-hit locales such as Southern California. But a bigger, often-overlooked, risk is the potential for CRE to remain a drag on the U.S. economy for years to come, or its potential to trigger a slide back into recession -- the so-called double dip that many fear.
3 reasons home prices are heading lower After four months of gains, home prices flattened in October. Worse yet, industry insiders think that they'll soon start to fall. Prices have risen more than 3% since May, according to S&P/Case-Shiller. But most forecasts predict price declines in 2010, with possible losses ranging from anywhere from 3% on up. Fiserv Lending Solutions, a financial analytics firm, forecasts that prices will fall in all but 39 of the 381 markets it covers, with an average drop of 11.3%.
False Hope in the Real Estate Comeback The Los Angeles Times tells us that mortgage defaults in the prime category rose in the 3rd quarter. If you are wondering what might happen to housing prices in the US…should the depression continue…you might want to keep an eye on the default rate. Housing prices are down about 30% nationwide. In some areas, they are down much more. But they had been going up for so long…this downswing still seems like an aberration. Hope has momentum…especially in the housing market. Housing prices rose along with inflation for 100 years. Then, they rose much faster than inflation over the last 10 years, ending in 2007. This leaves people with the impression – false – that housing always goes up over the long run. As we have pointed out many times in these Daily Reckonings, housing prices in the nicest neighborhood of Baltimore, where we have our offices, hit their highs, in real terms, in the 1920s. They’ve been going down ever since. Even after the big run up to 2007, they were still below their ’20s peaks. That’s a bear market in real estate prices that has lasted, so far, 80 years.
3/3 Gerald Celente top 10 Predictions for 2010! StopTheRobbery.com
Fannie mortgage holdings sink, delinquencies leap Fannie Mae's gross mortgage portfolio shrank sharply in November while the delinquency rate on single-family loans it guarantees leaped in October, the government-controlled U.S. home funding company said on Monday. The company said its mortgage investments fell at a 26.1 percent annual rate last month to $752.2 billion. Year-to-date, the portfolio has declined by an annual 4.9 percent from $787.3 billion at the end of last December. Fannie Mae also reported an ongoing jump in the rate of late payments on single-family loans it guarantees, a problem that has eaten into its capital and forced borrowing from the U.S. Treasury.
U.S. to Lose $400 Billion on Fannie, Freddie, Wallison Says Taxpayer losses from supporting Fannie Mae and Freddie Mac will top $400 billion, according to Peter Wallison, a former general counsel at the Treasury who is now a fellow at the American Enterprise Institute. “The situation is they are losing gobs of money, up to $400 billion in mortgages,” Wallison said in a Bloomberg Television interview. The Treasury Department recognized last week that losses will be more than $400 billion when it raised its limit on federal support for the two government-sponsored enterprises, he said.
The Ethics of Walking Away, Continued Tuesday, I asked Megan McArdle how much of one’s life’s savings should be given to the bank before they take one’s house. She answers, gratifyingly, that in the particular case I was writing about, “obviously he should have walked away immediately.” Good, we’re in agreement on that. If you’re going to lose your house, best just to lose your house, rather than to lose your house and your savings. But then, puzzlingly, Megan asks “what Felix thinks this has to do with people who decide to default on their mortgages so that they’ll have more money to spend on cruises and new furniture”.
Retirees Snared by Medicare As People Work Longer, They Risk Penalties for Missing Deadlines Rules for enrolling in Medicare are complex. But when people postpone retirement past age 65, as many people are doing these days, it's easy to get caught up in red tape. Older adults can't get into Medicare any time they want. The easiest time to sign up is when you turn 65, and, if you're already collecting Social Security, enrollment is automatic. But if you keep working beyond that age and opt instead to stay with your employer's group health plan, your options for getting Medicare can be sharply limited. It's important to pay attention to strict enrollment deadlines, or you may face a fine and risk going without coverage for months.
Mayo Clinic in Arizona to Stop Treating Some Medicare Patients The Mayo Clinic, praised by President Barack Obama as a national model for efficient health care, will stop accepting Medicare patients as of tomorrow at one of its primary-care clinics in Arizona, saying the U.S. government pays too little. More than 3,000 patients eligible for Medicare, the government’s largest health-insurance program, will be forced to pay cash if they want to continue seeing their doctors at a Mayo family clinic in Glendale, northwest of Phoenix, said Michael Yardley, a Mayo spokesman. The decision, which Yardley called a two-year pilot project, won’t affect other Mayo facilities in Arizona, Florida and Minnesota.
Economist: Health Care Bill "Is Just Another Bailout Of The Financial System" It is obvious that many republicans oppose the proposed health care bill. But many liberals and progressives oppose it as well. For example, economist L. Randall Wray writes: Here's the opportunity, Wall Street's newest and bestest gamble: there is a huge untapped market of some 50 million people who are not paying insurance premiums-and the number grows every year because employers drop coverage and people can't afford premiums. Solution? Health insurance "reform" that requires everyone to turn over their pay to Wall Street. Can't afford the premiums? That is OK-Uncle Sam will kick in a few hundred billion to help out the insurers. Of course, do not expect more health care or better health outcomes because that has nothing to do with "reform" … Wall Street's insurers… see a missed opportunity. They'll collect the extra premiums and deny the claims. This is just another bailout of the financial system, because the tens of trillions of dollars already committed are not nearly enough. Wray points out that - with the repeal of Glass Steagall - the financial sector and the insurance businesses (the "f" and "i" in the "fire" sector) are somewhat merged.
Report: 13 States Threaten to Sue Over Health Care Deal Republican attorneys general in 13 states say congressional leaders must remove Nebraska's political deal from the federal health care reform bill or face legal action, according to a letter provided to The Associated Press Wednesday. "We believe this provision is constitutionally flawed," South Carolina Attorney General Henry McMaster and the 12 other attorneys general wrote in the letter to be sent Wednesday night to House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid. "As chief legal officers of our states we are contemplating a legal challenge to this provision and we ask you to take action to render this challenge unnecessary by striking that provision," they wrote.
Watch Small Business for Employment Trends. The Outlook Is Bleak The Discover Small Business Watch index is the most up-to-date poll on conditions in the sector which has accounted for the vast majority of employment growth in all the economic recoveries of the past thirty-five years. The DSBW Index collapsed in November, to 76.5 from 88 in October. December remains unchanged. But fewer small business owners expect the economy to improve.
Colorado's minimum wage becomes 1st in US to drop Colorado's minimum wage going down 3 cents in 2010, first drop in the nation since 1938 Colorado's minimum wage will drop slightly in the new year -- the first decrease in any state's minimum wage since the federal minimum was adopted in 1938. Colorado's wage is falling 3 cents an hour, from $7.28 to the federal level of $7.25. That's because Colorado is one of 10 states that tie the state minimum wage to inflation. The goal is to protect low-wage workers from having unchanged paychecks as the cost of living goes up. But Colorado's provision also allows wage declines, and the state's consumer price index fell 0.6 percent last year, so the minimum wage is going down.
20 million-plus collect unemployment checks in '09 A record 20 million-plus people collected unemployment benefits at some point in 2009, a year that ended with the jobless rate at 10 percent. As the pace of layoffs slows, the number of new applicants visiting unemployment offices has been on the decline in recent months. But limited hiring means the ranks of the long-term unemployed continues to grow, with more than 5.8 million people out of work for more than six months. The number of new claims for jobless benefits dropped last week to 432,000, the Labor Department said Thursday, down sharply from its late March peak of 674,000. The decline signals that the economy could begin adding a small number of jobs in January, several economists said.
Rick Warren's Saddleback Church In Desperate Fundraising Appeal After Collection Plates Run Dry Rick Warren is the conservative evangelical minister who somehow has become a trusted friend to both Republicans and Democrats. Obama came to his Saddleback Church during the campaign, and then Warren spoke at his inauguration. But the bad economy is taking its toll on his empire, and yesterday he sent out an emergency fundraising appeal to the church's members.
FCC Urges Fox, Time Warner to Settle Dispute The nation's top telecommunications regulator waded into the ongoing programming negotiations between News Corp. and Time Warner Cable Inc., urging the companies to reach a temporary agreement and prevent subscribers from losing some Fox channels. "I have urged Fox and Time Warner Cable to agree to a temporary extension of carriage if they do not come to terms on a new carriage agreement today, in order to prevent disruption to their viewers," said Julius Genachowski, chairman of the Federal Communications Commission, in a written statement Thursday. "Companies shouldn't force cable-watching football fans to scramble for other means of TV delivery on New Year's weekend."
Scripps Networks Warns Cablevision Viewers of Blackout over Fees Scripps Networks Interactive Inc. began warning Cablevision Systems Corp. subscribers Thursday that its Food Network and HGTV channels may be "dropped from your TV lineup," as another contentious negotiation over programming fees spilled into public view. Cablevision's agreement to carry the Scripps channels expires at midnight Thursday, according to a person familiar with the matter. Cablevision provides TV service to approximately 3.1 million people largely in the New York area.
Delta, Northwest can work as single carrier US gov't authorizes Delta, Northwest to operate as single carrier Delta Air Lines Inc. has received government permission to operate its namesake service and its Northwest Airlines subsidiary as a single carrier, a Delta executive said Thursday. The single operating certificate from the Federal Aviation Administration allows Delta to put its code on Northwest flights and phase out the Northwest name. That process will be complete in the first quarter of 2010. For now, travelers won't notice anything different. Delta, based in Atlanta, acquired Northwest for $2.8 billion in stock in October 2008 to become the world's biggest airline.
Mailman to deliver aid in case of anthrax attack President Obama puts the Postal Service in charge of dispensing drugs If the nation ever faces a large-scale attack by a biological weapon like anthrax, the U.S. Postal Service will be in charge of delivering whatever drugs and other medical aid Americans would need to survive. In an executive order released Wednesday, President Barack Obama put the Postal Service in charge of dispensing "medical countermeasures" to biological weapons because of its "capacity for rapid residential delivery."
Special update on Schiff for Senate
North Korea bans foreign currencies North Korea has banned the use of foreign currency, another sign its hard-line communist government is intent on reasserting control over the country's nascent market economy. Reports say the decree warns of severe punishment for anyone using U.S. dollars, euros, yuan and other non-North Korean currencies. Foreign currencies previously were accepted in some shops, restaurants and other outlets, particularly those catering to foreigners. The order, issued by North Korea's state security bureau and going into effect Jan. 1, aims to "forbid the circulation of foreign currency," China's state-run CCTV television said in a brief report late Wednesday.
Snowstorm squelches climate change protest A downtown protest of the climate change talks in Copenhagen became a victim of Wednesday's snowstorm. "Not many people showed up because of the blizzard conditions," said organizer Clea Major, an international studies student at the University of Utah. It didn't take long for the six friends to pack up a bullhorn and posters they'd planned to use for their "scream-in," an outlet for their frustration about the failure of the Copenhagen climate talks earlier this month to curb the pollution blamed for climate change.
Yes, Yemen Has Oil The Middle Eastern nation - in the south of the Arabian Peninsula, bordering the Arabian Sea, Gulf of Aden, and Red Sea - has been exporting a couple of billion dollars worth of crude oil per year. But it's oil supplies are shrinking rapidly, and may be totally depleted within 10 years. As the Yemen Observer notes: Yemeni crude oil exports decreased to $1.5 billion during the fiscal period from January -October of 2009, compared with $4.2 billion during the same period of 2008, a decrease of $2.7 billion, the Central Bank of Yemen reported.
Yemen oil revenue decreases by 2 million barrels Yemeni crude oil experts decreased to $1.5 billion during the fiscal period from January -October of 2009, compared with $4.2 billion during the same period of 2008, a decrease of $2.7 billion, the Central Bank of Yemen reported. The statement revealed that the record decline in oil returns was accompanied by the government's ebbing share of total oil exports during this period, from 38.8 million barrels to 24.5 million barrels. A report issued by CBY attribute the decline to the decrease of Yemen oil production in conjunction with the decrease of oil prices globally.
Nigerian Terrorist Patsy Yet Another CIA Ploy in US-backed Buildup of al Qaeda in Yemen Civil War Tarpley tells RT that the case of Umar Farouk Abdulmutallab is not a matter of unconnected dots, but rather that of a protected patsy or puppet deliberately used by the US intelligence community for a Christmas Day provocation designed to facilitate US meddling in the civil war in Yemen, which is where Umar Farouk allegedly trained and was given his PETN device. Banker's son Umar Farouk had been denied an entrance visa to Great Britain , and had been denounced to the US Embassy in Lagos, Nigeria as a possible terrorist by his own father in mid-November. His one-way ticket to Detroit was bought in Ghana for cash, and he reportedly entered Nigeria illegally. In Amsterdam , he was assisted at the Northwest Airlines gate by a "well-dressed Indian" who explained that Umar Farouk had no passport. He did have PETN, the same substance supposedly used by the mentally impaired shoe bomber Richard Reid in his abortive attack of eight years ago. In spite of all this, Umar Farouk's US entry visa was never revoked, he never made it onto the no-fly list, and he was never thoroughly searched.
Detroit terror attack: United States 'plans retaliatory attacks on Yemeni soil' The United States is planning to attack al Qaeda militants in Yemen in retaliation for the attempt to bring down an aeroplane over Detroit on Christmas Day, it has been reported. Intelligence efforts are said to be focused on finding those involved in the plot to get Nigerian Umar Farouk Abdulmutallab on the Northwest Airlines plane with explosives in his underwear. Security officials are also likely to identify other "high value" al Qaeda targets who could be the target of strikes.
Eyewitnesses: 2 arrested in Christmas flight terror 'How stupid do you think the American public is?' Several passengers aboard the Christmas Day flight to Detroit where a Nigerian man attempted to blow up the airplane say a second passenger was arrested after the foiled terrorist attack – and they suggested other men may have played roles as well. Kurt Haskell of Newport, Mich., and his wife, Lori, claim they were aboard Flight 253 as they returned from a safari in Uganda, seated only a few rows behind suspected attacker Umar Farouk Abdulmutallab, a man who admitted to affiliation with the terrorist group al-Qaida. Haskill presented a boarding pass to Michigan Live to show that he had been a passenger on the plane.
Northwest Bomb Plot 'Oddities' In 2008, the ACLU estimated the US 'No Fly List' to have grown to over 1,000,000 names -- heck, even Cat Stevens and the late Senator Ted Kennedy were on it -- and it continues to expand. But, suspected terrorist Abdul Farouk Abdulmutallab, who was curiously able to obtain military-grade high explosives --80 grams of PETN (Gee, where'd he get that?) -- managed to escape airport security and detonate his underwear bomb! In April 2009, American authorities reportedly refused an Air France flight from Paris to Mexico entry into US airspace because a left-wing journalist writing a book on the CIA was on board. Hernando Calvo Ospina, who works for Le Monde Diplomatique and has written on revolutionary movements in Cuba and Colombia, figured on the US authorities' 'no-fly list.' Air France said the April 18 flight was forced to divert to the French Caribbean island of Martinique before continuing its journey .
Webster Tarpley: 'Detroit jet terrorist attack was staged'
Officials Claim Second Man Unrelated To Christmas Attack Bomber's accomplice being protected? Multiple eyewitness accounts contradicted Having first denied the very existence of a possible accomplice in the Christmas Day bombing attempt, officials are now denying that a second man detained in the aftermath of the Flight 253 incident had anything to do with the attack, completely contradicting multiple eyewitness accounts. Authorities have attempted to downplay the significance of other men seen involved in the plot, including an Indian man that helped bomber Umar Farouk Abdulmutallab board the plane, another man witnessed filming the entire flight including the bombing attempt, as well as an Indian man handcuffed by the FBI after sniffer dogs detected something suspicious in his luggage.
Number of U.S. soldiers killed in Afghanistan doubles in 2009 The year's tally was 318, compared with 155 in 2008, due mostly to the crude but ever larger and deadlier roadside bombs employed by the Taliban. And Western military fatalities are expected to spike. Reporting from Kabul, Afghanistan - American military fatalities in Afghanistan doubled in 2009 compared with the previous year, and U.S. officials and analysts acknowledge that the new year is likely to prove even more lethal.
Dennis Kucinich "This War Is A Threat To Our National Security!
President makes Top 10 list of corrupt politicians Believes he 'can violate privacy rights of Americans' without legal consequence President Obama has been named to a "Top 10" list he'd likely be grateful to avoid: Judicial Watch's "Ten Most Wanted Corrupt Politicians," for 2009. "The Obama White House believes," said the report from the organization that monitors government for corruption, and sues when it chooses, "it can violate the privacy rights of American citizens without any legal consequences or accountability." The report released yesterday said Obama joined the likes of Rep. Barney Frank, D-Mass.; Treasury Secretary Timothy Geithner; Attorney General Eric Holder; House Speaker Nancy Pelosi; Rep. John Murtha, D-Pa.; and Sen. Christopher Dodd, D-Conn., on the list.
Social Engineering behind leader worship
***** Important . . . if your kids are watching
About avatars: Caveat emptor! Even before the buzz began building for James Cameron's sci fi blockbuster Avatar, today's "millennial generation," the film's biggest fans, knew what the word meant. Few knew the classical definition of "avatar" as "the incarnation of a Hindu deity" that people my age learned in the 1960s taking comparative religion courses or reading Hermann Hesse. To current-day collegians, the word is the self-definition of a hi-tech kid who manipulates an image of himself projected in a computer game. . . . . . . . . YET WHAT could seem further apart than Hitler the Aryan white supremacist and Cameron's hero, Jake, who loves the wronged Navi enough to be reborn as one? Unfortunately, youthful members of the rightist underground who avidly read reprints of Devi's deification of the Fuhrer don't look at Hitler with Cameron's loathing - and they may view Avatar as quite compatible with their own extremist faith.
A Call for Geithner's Head Columnist Gary Weiss proposes several New Year's resolutions in the name of Wall Street overseers. Number one: President Obama should fire Tim Geithner. This week I’d like to make some New Year’s resolutions. This being a time of giving, I’ve generously made New Year’s resolutions not for myself, but for the people and institutions who run and supervise Wall Street. There are some things they need to do next year, and they’d better get cracking. So without further ado: President Obama: My New Year’s resolution for the president is that he fire Tim Geithner. That’s the best thing he can do to restore investor confidence in the markets.
Coming Soon: The Bill for the Massive U.S. Debt Americans could be in for a rude awakening in coming months when they discover the true scope of the massive national debt racked up by the U.S. government. In fact, the $1.6 trillion deficit expected for 2010, which is above 10% of gross domestic product (GDP), is only the beginning. Since the current economic crisis began in late 2007, the U.S. Federal Reserve has tripled the size of its balance sheet, creating enormous amounts of new money by lending to hundreds of ailing banks and buying up more than $1 trillion of questionable asset-backed securities. But that's only a small part of the story.
United States Debt Ridden Road to Perdition Decade after decade, Americans have voted for intellectually and morally bankrupt dullards that promise them more goodies under the tree. Every day is Christmas in Washington DC. Long-term means the next election cycle to these traitors of the Republic. I have written ad nauseum about the impending financial cataclysm that awaits our nation. I have spent countless hours documenting the unsustainable path of our politicians’ financial decisions and lack of courage in addressing the forthcoming tragedy that grows closer by the day. Our political system is so corrupt and dysfunctional that there is absolutely no chance that our path will be altered at the voting booth. Government programs are fashioned, but never finished. The IRS tax code consists of 3.4 million words covering 7,500 pages of payoffs to business lobbyists. Simplicity is a virtue.
Countdown to a Meltdown America's coming economic crisis. A look back from the election of 2016 It is time to think carefully about the next year. Our position is uniquely promising - and uniquely difficult. The promise lies in the fact that you are going to win the election. Nothing is guaranteed in politics, but based on everything we know, and barring an act of God or a disastrous error on our side, one year from today you will be sworn in as the forty-sixth president of the United States. And you will be the first president since before the Civil War to come from neither the Republican nor the Democratic Party.1 This is one aspect of your electoral advantage right now: having created our new party, you are already assured of its nomination, whereas the candidates from the two legacy parties are still carving themselves up in their primaries.
Times Square, Nasdaq reopened after scare New York City's Times Square was closed briefly and three buildings including the Nasdaq headquarters were evacuated in a security scare on Wednesday, a day before the traditional New Year's Eve festivities in the famed intersection. The street closings and evacuations were prompted by a police investigation of a suspicious van that local media reported had been parked on Broadway for two days. No explosives were found in the van, which police examined with robots and remote cameras. The typically busy Times Square intersection, Nasdaq building and two other buildings were cleared of people during the investigation which lasted about two hours.
Doug Casey on Gold Proofing Your Way Out of the Recession As the world's economies continue to crumble, you need to rethink your financial strategies if you plan on having enough left when you retire. This gives you insights on what to do no matter your current situation.
Gold steadies after dollar's rise dulls price Gold prices steadied in Asia on Thursday after dropping in U.S. trading as investors unwound long-gold short-dollar positions and cashed in on bullion's 25 percent rally this year, the metal's ninth consecutive annual rise.
Gold to hit $1,500 in 2010: Merrill Lynch Gold prices have been on a surge in 2009. Will the yellow metal continue to shine better in 2010; that is the question bullion traders and investors are asking these days. Global consultancy Merrill Lynch says gold bullion prices could rise to as high as $1,500 an ounce over the next year and a half thanks to a combination of factors. Bill O'Neill, from Merrill Lynch Wealth Management, told the Times that ongoing credit risk, the strength of commodities and the weakness of the US dollar would contribute to the rise.
Precious Metals to glitter in 2010 In welcoming 2010, the stars could not be better aligned for precious metal investors. Stimulus spending, coupled with a low federal funds rate and a new jobs program, should put plenty of money in the hands of precious metals holders. Stimulus and Silver 2009 was just the beginning for federal stimulus programs. Although the American Reinvestment Act was pushed through Congress in a matter of days, the money has moved much slower. Currently, only 58% of the allocated $158 billion has been awarded to start work on "shovel ready projects." However, of all the money awarded, only about $37 billion has actually been spent thus far. Many more projects are slated to start early 2010, and nearly all of the money will have been spent by 2011.
2010 Forecast: Gold to hit $1500, Silver to hit $25 I have been making my 10 predictions for 2 years now, since 2008. I initially got this idea from Byron Wien who has been publishing them every year since the 1980s, when he was with Morgan Stanley, then Pequot Capital , and now with Blackstone. My first picks for 2008 were accurate and had anticipated almost all major trends, substantially better than Byron's - something I called beginner's luck.
2009: A Good Year Mary Anne & Pamela Aden The Aden Sisters WHAT ABOUT 2010? Will these upmoves continue as we move into the new year? We believe that they will. But since these markets have all had significant gains, we’ll likely see further downward corrections first before they resume their rises. So don’t be surprised. Remember, no market goes straight up or straight down. Corrections along the way are normal and they’re healthy. The major trends are always the most important. That’s where your focus should be because that’s where the greatest profits are made.
Gold on sale as year ends The price of Gold dropped to a 3-session low at the start of London dealing on Wednesday, cutting its 2009 gains vs. the Dollar to 30% and losing 2.1% for the week so far. World stock markets fell together with government bonds. The US Dollar ticked higher on the forex market. Crude oil held near a 77% gain for the year above $79 per barrel.
Gold-price forecasts are all over the map Analysis estimates range from $950 to $1,500 The 2009 gold price average has settled-in at $972/troy ounce. A recovery in industrial production is likely to be needed to spark major gains in the industrial precious metals, but there's little consensus among analysts where the gold price is going in 2010-with forecasts are ranging from $950 to $1,500. The 2009 gold price jumped about $100 from the 2008 average as the noble metal was boosted by central bank diversification of cash reserves into bullion and by weakness in the dollar that pushed safe-haven investments into precious metals.
Gold Reserves: Nations scramble for golden pie Bullion and precious metals lovers and investors will remember and relish 2009 for all the good and bad things that made gold the hottest darling of investing public, traders, market manipulators and speculators across the world. Good things that they would relish: gold prices hit a record of $1227 per ounce; gold rush is on by mining countries across the world and nations are scrambling to amass gold reserves. Bad things that they pray that should happen in 2010: further collapse of the US dollar, wild stock market fluctuations and crashes that make gold a safe haven asset, and real estate bottoming down so that people rush to buy gold and silver as family assets!
Gold set to end year down 10pc from its December high Gold prices edged down with the dollar's firmness curbing bullion's appeal as a currency alternative. Gold hovered around the $1,080/oz level as the year draws to a close, around 10pc lower than its December high of $1212/oz. Trading remained very subdued with many Japanese players out of the market for new year holidays until January 4. Market players eyed the dollar, which kept the firmer tone it has developed recently on shifting sentiment about the outlook for U.S. rates in view of improving economic data. Some traders said the correction in gold prices was about to end as dollar short-covering, which was partly responsible for the dollar's recent rebound, was also nearly completed.
Gold, Silver, U.S. Dollar: All Hovering Below Resistance Areas Last week, and coming into this week we said the story in gold/silver vs. the US dollar would be a key marker. Thus far we have no resolution and with so little energy and volume in the markets - one should not expect any more clarity until the new year. Let's check in on the updated charts. First the US dollar (again, this chart is delayed by 1 day but the Dollar Index is currently just over $78, so a bit higher than Tuesday's close). Recall we sold our UUP (dollar ETF) options (bought just before Thanksgiving) on that first run into the 200 day moving average to lock in just under 30% gains; which in retrospect was the perfect play. As we said then, we are more than happy to re-buy our long dollar exposure but this time around we want to see the dollar index clear resistance - in this case the 200 day moving average (i.e. over $78.50) - this looks like it could happen.
Gold, lover of 2009 doom, hates booming 2010! Even as the world gets ready to write the obituary for 2009, there are millions of investors across the globe who must be thanking gold for saving the year for them. . . . . . . . . Near-term risk for gold at the moment remains very much on the downside. So analysts predict that gold will be around $1000/oz-to- $1100/oz band in the next six months. However, there are optimists who say gold prices will hover around $1400 to $1450 in the second quarter of 2010.
Jim Sinclair - A markets bear, but gold bull, crying in the wilderness Jim Sinclair can't find a markets bear anywhere and that rings warning bells! Jim Sinclair, a much respected and followed bull on the gold price, despairs of the analysts predicting a stock market boom in 2010. In a note yesterday Sinclair says "As we approach the New Year it seems the party has already begun, and the commentators are all full of spirits. I can't find a bear in the woods." "According to them the equity market is going up, the dollar is going up, commodities are going up, and even lip service is being paid to gold, but lip service only. The conviction being blasted out there is a line up of former pro-gold guys like Faber and Rogers. Today they rolled out Barton Biggs for his bullish equity-bullish dollar forecast. Soros and Buffett have already made their contribution to a dollar rally."
GATA sues Fed to disclose gold market intervention records GATA today brought suit against the U.S. Federal Reserve Board, seeking a court order for disclosure of the central bank's records of its surreptitious market intervention to suppress the monetary metal's price. The suit was filed in U.S. District Court for the District of Columbia and targets Fed records involving gold swaps, exchanges of gold with foreign financial institutions. In a letter dated September 17 this year to GATA's law firm, William J. Olson P.C. of Vienna, Virginia, (http://www.lawandfreedom.com) Fed Board of Governors member Kevin M. Warsh acknowledged that the Fed has gold swap agreements with foreign banks but insisted that such documents remain secret: http://www.gata.org/files/GATAFedResponse-09-17-2009.pdf
Ron Paul vs. The Fed Congressman Ron Paul crusades to get the Federal Reserve to become more transparent and end favoritism.
Dollar Gains as Gold, Equities Retreat on Stimulus Speculation The dollar climbed, sending gold and U.S. equities lower, as signs of an improving economy added to speculation the Federal Reserve will withdraw stimulus measures. Treasuries were little changed before an auction of $32 billion of seven-year debt.
2010's Perils & Potential To see 2010’s Potential we must first consider the Main Perils. “Hyperinflation Nears… The intensifying economic and solvency crises, and the responses to both by the U.S. government and the Federal Reserve in the last two years, have exacerbated the government’s solvency issues and moved forward my timing estimation for the hyperinflation to the next five years, from the 2010 to 2018 timing range estimated in the prior report. The U.S. government and Federal Reserve already have committed the system to this course through the easy politics of a bottomless pocketbook, the servicing of big-moneyed special interests, gross mismanagement, and a deliberate and ongoing effort to debase the U.S. currency. Accordingly, risks are particularly high of the hyperinflation crisis breaking within the next year…
Ghosts of 1987 I am a 'fan' of very few people in the money business. One of my favorite pundits is a frequent guest on Bloomberg Television, which I tend to watch off and on during the day on my computer screen: Joe Saluzzi. Another person for whom I always turn up the volume is Howard Davidowitz, the savvy and no-nonsense retail analyst. Here is Joe Saluzzi's excellent explanation for the 'odd' market behaviour which many traders have noted to me in the past few weeks.
Joe Saluzzi of Themis Trading on Bloomberg TV's Starting Bell
Renminbi set to replace US dollar for trade in Asia Pacific Hong Kong moves to position itself as clearing hub for renminbi-based transactions The Chinese renminbi is taking on an increased role in the Asia-Pacific region, and is expected over time to replace traditionally dominant currencies such as the US dollar and the euro for certain transactions. Chinese government policy changes have enabled Asian corporates to settle trades with their Chinese counterparts in renminbi. And increased intra-Asian trading volume may lead Beijing to also consider allowing other trade-related insurance and derivatives denominated in renminbi to be done offshore, according to bankers and regulators in Hong Kong
Lawmakers Want Probe Into Treasury Aid for Fannie, Freddie The Treasury Department's surprise Christmas Eve move to uncap the potential aid to Fannie Mae and Freddie Mac should be investigated, lawmakers from both political parties said Wednesday. Rep. Dennis Kucinich (D., Ohio) said his congressional subcommittee plans to investigate Treasury's decision to lift the existing $400 billion cap on government cash available to the two firms. Separately, Reps. Scott Garrett (R., N.J.) and Spencer Bachus (R., Ala.) called for the House Financial Services Committee to hold a hearing on the matter.
Fannie, Freddie lifeline comes with a big catch The government's Christmas Eve pledge of unlimited financial aid to mortgage giants Fannie Mae and Freddie Mac is aimed at making sure the housing market doesn't take another turn for the worse and cause the economic recovery to unravel. This insurance policy taken out by the Treasury Department will help keep mortgage rates low, and may wind up being a gift of sorts to struggling homeowners and banks. But there's a catch: The housing crisis is now likely to cost taxpayers much more.
Fannie, Freddie proving too big to shrink Taxpayer tab for Fannie Mae, Freddie Mac likely to rise after Treasury's Christmas Eve pledge The government's Christmas Eve pledge of unlimited financial aid to mortgage giants Fannie Mae and Freddie Mac is aimed at making sure the housing market doesn't take another turn for the worse and cause the economic recovery to unravel. This insurance policy taken out by the Treasury Department will help keep mortgage rates low, and may wind up being a gift of sorts to struggling homeowners and banks. But there's a catch: the housing crisis is now likely to cost taxpayers much more.
Lenders Write Off More Credit Card Debt As job losses continued to mount, more and more consumers fell behind on their payments in November, Moody's Investor's Services reported Tuesday. Moody's Credit Card Index showed the charge-off rate on U.S. credit cards rose to 10.56%, up from October's charge rate of 10.04%. This reverses the recent downward trend in the charge-off rate, which had fallen in September and October.
'Too Big To Fail' Response Supports Bank Debt Government support of the U.S. banking sector, pending regulatory reform and reduced borrowing needs may benefit financial-company debt in 2010, according to Bank of America Merrill Lynch analysts. Declining loan demand means banks won't refinance all their debt coming due next year, analysts led by Jeffrey Rosenberg at Bank of America Merrill Lynch in New York wrote in a Dec. 23 report. John Gerspach, Citigroup Inc.'s chief financial officer, said his bank plans to refinance a third of the $45 billion in debt coming due next year, the analysts wrote.
Bankers Get $4 Trillion Gift From Barney Frank To close out 2009, I decided to do something I bet no member of Congress has done -- actually read from cover to cover one of the pieces of sweeping legislation bouncing around Capitol Hill. Hunkering down by the fire, I snuggled up with H.R. 4173, the financial-reform legislation passed earlier this month by the House of Representatives. The Senate has yet to pass its own reform plan. The baby of Financial Services Committee Chairman Barney Frank, the House bill is meant to address everything from too-big-to-fail banks to asleep-at-the-switch credit-ratings companies to the protection of consumers from greedy lenders.
Judge Napolitano: One Big Monster Government
Treasuries Set for Worst Year Since 1978 as U.S. Steps Up Sales Treasuries headed for the worst year in at least three decades as the U.S. stepped up debt sales to help spur growth in an economy recovering from the biggest slump since the Great Depression. The existing seven-year note was little changed after a $32 billion of sale of the debt drew a yield of 3.345 percent, compared with an average forecast of 3.372 percent in a Bloomberg News survey of four of the Federal Reserve's 18 primary dealers. U.S. government securities have fallen 3.6 percent this year, according to Bank of America Merrill Lynch indexes, the worst performance since 1978.
World Credit Market Shrinks First Time in 15 Years, Mizuho Says The amount of corporate debt outstanding globally shrank for the first time in at least 15 years in the first half of 2009 as U.S. banks reduced the size of their balance sheets, according to Mizuho Securities Co. The volume of corporate bonds, commercial paper and asset- backed securities fell to $52.9 trillion at June 30 from $53.2 trillion on the same day in 2008, Tetsuo Ishihara, a senior credit analyst for Mizuho in Tokyo, said in a report yesterday that analyzed data from the Bank for International Settlements.
Eurozone credit contraction accelerates Bank loans and the M3 money supply in the eurozone contracted at an accelerating pace in November, raising the risk that a lending squeeze will choke the region's fragile recovery next year. The European Central Bank said that loans to companies fell by a record 1.9pc from a year earlier. The broad M3 money supply - watched closely as a leading indicator for the economy a year ahead - fell by 0.2pc and has now been shrinking for several months. Julian Callow from Barclays Capital said the decline in lending was steeper than expected and will cause the ECB to move with great care before withdrawing emergency stimulus. "This is the weakest data since the statistics began in 1970 and probably in the post-war era. It is a message about what is happening to the banking system, which is the lending nexus for the eurozone economy," he said.
Michael Moore on The Charlie Rose Show (Friday, October 9th, 2009) "It's called a pyramid scheme, because only a few people can sit on top of the pyramid. Their job is to convince everybody else in the pyramid to work really hard because 'maybe you, too, can be up there in the pyramid with me some day,' but of course we all know that's not gonna happen. ... This whole system is set up to make sure that the people at the very, very top get away like bandits. ... You're asking the foxes to mind their own henhouse ... That's essentially what I feel we have, when you have the Rubins' and the Summers' and these guys still around. ... I think there is something boiling beneath the surface out there -- there is an anger. You can't throw that many people out of their homes ..." -- Michael Moore on The Charlie Rose Show, Friday, October 9th, 2009
"Financial Reform" Just Camouflage for Wall Street's Latest Power Play Anti-Wall Street sentiment makes for a good cover, but behind the scenes and rhetoric, legislators are working with the country's largest financial firms to fashion a new system that concentrates even more risk and reward at fewer banks. And what's more, the underlying socialization of the system will guarantee the success of excess with the full faith and credit of taxpayers. On Dec. 11, the U.S. House of Representatives passed the Wall Street Reform and Consumer Protection Act of 2009, which among other things, creates a consumer protection agency, strips the U.S. Federal Reserve of certain powers and subjects it to politicization, calls for big banks to finance a $150 billion bailout fund and gives the government power to break up or coddle financial firms as they see fit.
Treasury grants GMAC $3.8 billion in new aid The government on Wednesday provided a fresh $3.8 billion cash infusion to stabilize GMAC Financial Services as the financing company struggles with hefty losses in its home mortgage unit. The Treasury Department said the new aid, which comes from a taxpayer-financed bailout fund, is less than the nearly $6 billion the government had earlier thought GMAC would need to stabilize the company. The fresh infusion is on top of $12.5 billion in taxpayer money Detroit-based GMAC has already received from the government. The new agreement will boost the federal government's ownership in GMAC to 56 percent, from 35 percent.
Episode: The Card Game Investigating the massive consumer loan industry and what's ahead for banks and consumers... Duration: (56:23) Premiere Date: 11/24/2009
Honeywell reports 265 layoffs, temporary closures Honeywell Aerospace is laying off and furloughing workers and will temporarily shut down Phoenix-area operations next week to cut costs. The New Jersey-based aerospace and electronic components manufacturer reported to the Arizona Department of Economic Security that it will cut 265 Phoenix-area jobs in 2010. Honeywell has 12,600 workers in Arizona, mostly in its aerospace division. Details of the actions were not disclosed other to say the cuts will occur at the Honeywell plant on Air Lane near the airport in Phoenix.
Philadelphia Faces Rising Toll of Domestic Violence Responding to a sharp increase in homicides stemming from domestic violence, the Philadelphia Police Department announced plans this week to change how officers handle domestic abuse cases. While Philadelphia's overall homicide rate has dropped about 9 percent and all violent crime in the city is down compared with this time last year, there have been 35 domestic homicides since January - a 67 percent increase from 2008. The police say two additional killings are still being investigated and are likely to be added to the tally.
If Anybody Bothered to Take a Close Look at the Latest Housing Numbers... I read through the usual suspects in the mainstream media yesterday after the Case Shiller numbers were released and see headlines such as "Home Prices Flatten in October After 5 Months of Gains" and "Mortgage insurers rally after housing data" and wonder just how many of these reporters and analysts actually bothered to look at the data versus repeating sound bites. This has been a bad three quarters for the fundamental bears, but there is absolutely no macro or fundamental reason to turn bullish. As a matter of fact, the only reason I can see to buy stocks is that the stock prices are going up. That, in and of itself, should give one pause.
Rich Cling to Life to Beat Tax Man Nothing's certain except death and taxes -- but a temporary lapse in the estate tax is causing a few wealthy Americans to try to bend those rules. Starting Jan. 1, the estate tax -- which can erase nearly half of a wealthy person's estate -- goes away for a year. For families facing end-of-life decisions in the immediate future, the change is making one of life's most trying episodes only more complex. "I have two clients on life support, and the families are struggling with whether to continue heroic measures for a few more days," says Joshua Rubenstein, a lawyer with Katten Muchin Rosenman LLP in New York. "Do they want to live for the rest of their lives having made serious medical decisions based on estate-tax law?"
America’s Looming Class War In the weeks and years immediately following September 11, 2001, many Americans succumbed to the attractive yet fictional idea that all people in the United States share the same interests, goals and values. This idea of a mystical "unity" among all Americans took widespread hold as a natural human reaction to an attack by foreigners on American soil. With a dangerous cocktail of fear and anger coursing through their veins, and prodded on by the docile and unquestioning American political-media establishment, it was easy and emotionally satisfying to imagine that "we" were united together in a quasi-spiritual bond against an evil and maniacal foreign enemy. Members of America’s political class were not oblivious to the fact that they could exploit this idea for their own personal gain, and they pounced at the opportunity to pass legislation aimed at controlling and subduing Americans themselves – in the name of protecting them, of course. Seeking to distract Americans from the obvious fact that the U.S. government had both provoked the attack and failed to stop it, a bellicose vanguard of the political class pounced at the opportunity to make real their dream of sending American soldiers into far-away deserts and rocky mountains in order to spread "democracy" to the savages of the world.
Survivalism Lite Preparing for the worst Lisa Bedford is what you'd imagine of a stereotypical soccer mom. She drives a white Tahoe SUV. An American flag flies outside her suburban Phoenix home. She sells Pampered Chef kitchen tools and likes to bake. Bedford and her husband have two young children, four dogs, and go to church on Sunday. But about a year ago, Bedford's homemaking skills went into overdrive. She began stockpiling canned food, and converted a spare bedroom into a giant storage facility. The trunk of each of her family's cars got its own 72-hour emergency kit – giant Tupperware containers full of iodine, beef jerky, emergency blankets, and even a blood-clotting agent designed for the battle-wounded. Bedford started thinking about an escape plan in case her family needed to leave in a hurry, and she and her husband set aside packed suitcases and cash. Then, for the first time in her life, Bedford went to a gun range and shot a .22 handgun. Now she regularly takes her two young children, 7 and 10, to target practice. "Over the last two years, I started feeling more and more unsettled about everything I was seeing, and I started thinking, 'What if we were in the same boat?'" says Bedford, 49.
Snow-Removal Bills Leave States Scrambling Paying for Future Storms Worries Officials After Blizzards Squeeze Cash-Strapped Budgets in Midwest, East The blizzards that hit the Midwest and the Eastern Seaboard this month rang up huge snow-removal bills for cash-strapped state and local governments -- and left officials scrambling to figure out how they will pay to clear roads later in the winter. Maryland's State Highway Administration has spent more than $27 million this year on snow removal, the bulk of that clearing away a massive pre-Christmas storm. But the agency's annual snow-removal budget is just $26 million.
Will recession bring the end of free TV? For more than 60 years, TV stations have broadcast news, sports and entertainment for free and made their money by showing commercials. That might not work much longer. The business model is unraveling at ABC, CBS, NBC and Fox and the local stations that carry the networks' programming. Cable TV and the Web have fractured the audience for free TV and siphoned its ad dollars. The recession has squeezed advertising further, forcing broadcasters to accelerate their push for new revenue to pay for programming.
Judge Napolitano : Healthcare is a Good, Not A Right!
Trial Lawyers Sidestep Malpractice Curbs With Blitz in Congress U.S. Senate staff members arriving at work by subway this month were greeted by signs proclaiming that "98,000 patients may die" through medical malpractice. On a single day in October, lawmakers received visits from more than 70 victims of doctors' errors and the attorneys who represented them. And the trial lawyers' political action committee gave members of the Democratic congressional majority more money than all but two other PACs.
Michael Moore Blasts House Health Care Bill "The health insurance companies are going to make an extra 70 billion dollars as a result of Americans being forced to buy their health insurance. What company wouldn't love this bill?" -- Michael Moore in Toronto Tuesday, November 17th, 2009
Codex Alimentarius (World Food Code) Summarized in 7 Points Dr. Rima Laibow HealthFreedomUSA.org, the website of the Natural Solutions Foundation, is beholden to no one: our only interest is health freedom. Rima E. Laibow, MD, successful natural medicine physician since the 1970s, has studied 16,000 pages of Codex documentation. Her conclusion is that people who say that Codex is "consumer protection", "voluntary", or "harmless" are, at best, seriously mistaken.
Codex: Serious Threat to Health and Health Freedom
Serves Economic Interests of Sickness Industries Through WTO and Napoleonic Code
DSHEA Protects America From Codex Alimentarius
Your Action is Needed Now!
Conclusion The objective of the pro-Codex Alimentarius multi nationals is to "boil the frog slowly" so that we do not wake up to it in time to avoid Codex. Once we have "HARMonize" to Codex Alimentarius, as long as we are in the WTO, we cannot amend or change what we've been "HARMonize" to. Codex Alimentarius will go into global implementation by December 31, 2009, unless We, the People, avert it. We must act now because right now, with $758 Million spent on declared Congressional lobbying by Big Pharma last year, there are members of Congress who are trying to overturn DSHEA and allow Pharma-friendly free reign for Codex. If protective laws like DSHEA are destroyed, the sanctioning power of the autocratic WTO kicks in, and it will be impossible to get out from under Codex Alimentarius. We can protect our access to high potency nutrients and stave off an adulterated food supply only by putting pressure on Congress
Codex Alimentarius - Google video 1:29:27 - 1 year ago Having spent the past twelve months investigating Codex Alimentarius, I am deeply disturbed by the almost total lack of awareness (or even interest) with regard to the implications of this pernicious global Commission, particularly amongst those most affected by the excesses of this restrictive legislation. In the words of the National Health Federation[i], the aims and objectives of Codex Alimentarius are as follows: * Only low-potency, "me too" supplements available that will do nothing for your health. * All or most foods genetically-modified. * Beneficial supplements unavailable or sold by prescription only. For many people, this agenda is so outrageous, they cannot believe such goals are achievable; yet this may well be the reality as soon as 31st December 2009, if the Codex Alimentarius Commission continues to disregard input from those who offer a counter perspective to the combined forces of Big Farmer & Big Pharma.
Codex Alimentarius Threatens Human Health On its web site, CA (Latin for food code) says: "The Codex Alimentarius Commission was created in 1963 by the FAO (Food and Agricultural Organization of the UN) and WHO (World Health Organization) to develop food standards, guidelines and related texts such as codes of practice under the Joint FAO/WHO Food Standards Programme. The main purposes of this Programme are protecting health of the consumers and ensuring fair trade practices in the food trade, and promoting coordination of all food standards work undertaken by international governmental and non-governmental organizations." Whatever its founding purpose, CA is much different today because corporate interests control it - global pharmaceutical, food, and banking giants in league with complicit UN and government agencies to promote GMOs over healthy foods, and drugs over natural remedies by restricting or banning vitamin and dietary supplements, except ones they control. Organic food as well by irradiation and hidden synthetic additives or ingredients.
Codex Alimentarius: Big Brother's Plan to Control Health Supplements Monstrously Toxic Power Play for Control of the Global Food Supply & Natural Health Industry The Codex Alimentarius agenda, which has long metastasized in the recesses of closed board rooms and governmental chambers, is now coming to light. This is the paramount issue of our times, yet few know about it. If Codex standards ever replace the current laws in the U.S. governing food and dietary supplements, it will affect not just Americans' right to choose supplements, but our right to grow crops with untampered seeds, to buy pure organic food, and to live free of the tyranny of Big Agro-Chem-Pharma-Med, through health-destructive FDA rules enacted and enforced by a pro-corporate government that cares nothing about our health freedom. In other words, the "natural health" industry will perish. Now more than ever, we must exercise our democratic duty and be vigilant in protecting that freedom, the health and survival of the Earth, and all her creatures and citizenry.
Judge Napolitano : Health Care Bill Will Destroy American Liberty!
Obama Slams Security Breach Reports, Intercepts Suggested Attack Preparations; Multiple Agencies Had Warning The U.S. had multiple pieces of information about alleged bomber Umar Farouk Abdulmutallab, according to senior U.S. officials, including intelligence reports and communications intercepts suggesting a Nigerian was being prepped for a terror strike by al Qaeda operatives in Yemen. The intercepts were collected piecemeal by the National Security Agency, which has been monitoring al Qaeda militants in that country, including former Guantanamo detainees believed to be leaders there.
Lieberman: Next Stop on the War on Terror Express – Yemen! On Sunday, Rep. Pete Hoekstra (R-MI) and Sen. Joe Lieberman (I-CT) told Fox News viewers about the latest country posing a threat to America: Yemen. Lieberman was particularly dire, warning that "if we don't act preemptively, Yemen will be tomorrow's war." On Fox News Sunday, Chris Wallace asked Hoekstra and Lieberman what kind of attitude America should take toward Yemen.
The Silent Cleric Who Holds the Key to Iran's Future We like to believe-and newspapers and television like us to believe-that the battle for Iran is being fought on the streets of Tehran, of Isfahan, of Najafabad. Untrue. The future of the nation is being decided in Qom, among the clerical leaders of Iranian Shia Islam; and one of the most influential of them-perhaps the closest of all the ayatollahs to President Ahmadinejad-is silent.
Eight Americans killed in Afghan blast were CIA agents Eight American civilians who were killed in a suicide attack at a military base in ?eastern Afghanistan yesterday were CIA agents, US officials confirmed tonight. CIA officials in Washington were not immediately available for comment, and US officials said they could not provide details before the agents' families were informed. The attack occurred late yesterday inside Forward Operating Base Chapman in Khost province, eastern Afghanistan. The base has been used to house a 'provincial reconstruction team' operating under Nato authority.
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Wed 12.30.2009
Patriot Radio News Hour Guest Host: Mark Call Radio show call-in # 877-254-7524
Trying to Revive an Economic Corpse We're coming to the end of the year… What have we learned? Here's how we would put it, a four-word lesson that applies to almost everything: "It's Not That Simple." We were on pretty solid ground - at least as far as understanding what was going on in the markets and the economy - up until the middle of 2009. The Bubble Epoque led to the Bust Epoque…just as we thought it would.
Tech Ticker's Best of 2009: Fan Favorite, Howard Davidowitz Davidowitz is a straight shooter who always tells it like he sees it. Whether it's his bearish predictions on the economy or his criticism of the government's bailouts, Davidowitz is always an impassioned observer.
All Eyes On Dollar As 2009 Comes To An End With a slow trading day expected today, investors will likely keep there eyes on the U.S. Dollar and whether it can maintain its recent upswing going into the New Year. Set to be released later today, the U.S. Consumer Confidence report should give traders a good idea about the general direction of the greenback as 2009 draws to a close.
FDIC Moves to Seize Slice of Bank-Stock Rallies The government has auctioned off more than 100 failed banks this year to other financial institutions. Now, it wants a bigger cut of the action. Starting next year, the Federal Deposit Insurance Corp. will ask bidders for some seized banks to offer the agency a chance to profit if the deal is well-received by the buyer's shareholders.
U.S. Economic Disaster Worse Than Weimar or Zimbabwe Interviewed by Louis James with Doug Casey L: So, Ben Bernanke just got named “Person of the Year” by Time magazine. I know you must have some thoughts in response to this auspicious event? Doug: I just don’t know where they find these people... On the other hand, Slime magazine has always said that those named Person of the Year are not necessarily the most laudable people, but those who’ve had the greatest impact on the events in a given year. That would explain Hitler’s achievement of the same honor, and Stalin getting the nod twice. L: Not to mention Bin Laden. Doug: Yes, let’s not mention him. This is different: Bernanke isn’t being held up as a villain, but as a hero
The Worldwide Crack Up Boom, According to Ludwig Von Mises Bill Bonner, June 2007 . . . . What is a "Crack-Up Boom?" Von Mises explains (with thanks to Ty Andros for reminding us): "'This first stage of the inflationary process may last for many years. While it lasts, the prices of many goods and services are not yet adjusted to the altered money relation. There are still people in the country who have not yet become aware of the fact that they are confronted with a price revolution which will finally result in a considerable rise of all prices, although the extent of this rise will not be the same in the various commodities and services. These people still believe that prices one day will drop. Waiting for this day, they restrict their purchases and concomitantly increase their cash holdings. As long as such ideas are still held by public opinion, it is not yet too late for the government to abandon its inflationary policy.'
Testing the Deflationist There are a handful of newsletter writers - but not one economist - who predict deflation. Why no economists? There is an old line, "where there are four economists, there will be five opinions." You would think that there would be at least one Ph.D-holding economist out there somewhere who is predicting price deflation. Maybe there is, but I have not found him yet. Note: nobody is predicting monetary deflation. The deflationists are predicting monetary inflation and price deflation. So, when you read someone who says that price deflation is just around the corner, you can be 99% sure that he is not an economist. That doesn't mean that he's necessarily wrong. It does mean that he can't find any back-up among the hordes of specialists who are paid to forecast such matters. He therefore has a problem in directing you to evidence.
2009 Review: Bulls Bet Big on Bernanke, Batter Bears What a difference a year makes: If 2008 was all about what went wrong on Wall Street, 2009 was characterized mainly by what went right, at least for the financial markets. Stocks sure didn't start the year on the right foot, tumbling into early March amid the ongoing fallout from the September 2008 Lehman Brothers bankruptcy and fears of bank nationalizations. But from the depths of the March lows, major averages mounted a historic and pretty much unrelenting rally. In the past 12 months, the Dow and S&P are each up more than 20% while the Nasdaq is up more than 40%.
The Debt Bomb Make no mistake; the developed world is drowning in debt and there are only two viable options – a global economic depression or very high inflation. It is our contention that the policymakers have chosen the latter option and over the following years, we will experience the trauma of severe inflation. Look. The American government is staring at total obligations of US$115 trillion, America’s debt-to-GDP ratio is off the charts and the American public is also up to its eyeballs in debt. Under this scenario, you can bet your bottom dollar that the American establishment will try to reduce this debt overhang through a process known as monetary inflation. If you have any doubt whatsoever, take a look at the chart below, which captures the incredible expansion in America’s monetary base.
We're on the Path for Fireworks in 2010 Many commentators have over the past few days churned out lists of 2010 predictions. Although never one to produce best and worst lists at the turn of the year, Richard Russell, 85-year-old doyen of newsletter writers and author of the Dow Theory Letters, did express a major concern, as quoted below: I’m thinking that we’re on the path for fireworks in 2010. The reason I say that is because the federal deficits are running into the trillions of dollars. The roll-over of debt coming up in the next two years defies comprehension. For instance, in the next two years the U.S. must roll over $2.5 trillion. Worldwide, banks during the coming two years will have to roll over $7 trillion. On top of that commercial real estate in the U.S. has $750 billion to roll over.
Leading the American Middle Class Through a Lost Decade As people prepare to pop champagne corks at midnight on New Year’s Eve, I see media hype about the years 2000-2009 being the "lost decade" in America. Those years overall were bad ones for Wall Street, but not for Main Street. So what if 401k portfolios became "201k" in and around the 2001 recession? House prices still went up. Jobs disappeared primarily in computer technology sector. The American middle class directly or indirectly measures its economic well being first by jobs and second by home ownership. All the other factors combined don't equal to either of these factors. Just because the stock market performed poorly over the zeroes doesn't mean it was a lost decade in suburbia. Middle America did just fine all the way through 2007 when the unemployment rate last stayed below 5%. Too bad Main Street’s lost decade didn't start on an even number nicely packaged for media spin and public consumption.
String of investment bubbles marked 2000-09 The bubble decade: Get-rich-quick lure of stocks, oil, mortgages led to trillion-dollar losses A string of exploding investment bubbles that started with the dot-coms and ended with mortgages and oil dominated the years from 2000 to 2009. And it looks like the next decade will be no different. It doesn't seem to matter to many hedge fund traders and other professional investors that the Standard & Poor's 500 index has turned in its first losing performance over the course of a decade, having fallen 23 percent from 1,469.25 at the start of 2000 to its current 1,126.20. Or that they or other investors helped create and then destroy the bubbles that left stocks worth $2.5 trillion less today than when the decade began -- and that's before adding in the effects of inflation.
Two hedge-fund managers predict the economy’s next leg down Shorting Goldman Sachs. PERHAPS ONE OF THE greatest failings in the run-up to the financial meltdown was a lack of perspective — an inability by many market participants to see the big picture. Not so with Kevin Duffy and Bill Laggner, principals of the Dallas-based hedge fund Bearing Asset Management. With the help of their proprietary credit-bubble index, developed in 2004, the managers sounded early warnings on housing and credit excesses, and capitalized handsomely on their forecasts by shorting Fannie Mae, Freddie Mac, money-center banks and brokers, builders, mortgage insurers and the like. Students of the Austrian school of economics, which espouses a free-market philosophy that ascribes business-cycle booms and busts to government meddling with interest rates, the pair is solidly in the contrarian camp, believing that the worst for the markets may be yet to come.
Pimco CEO: We're Trained to Think the "Farther You Fall, The Higher You'll Bounce Back. We're Hostage to the V"-Shaped Recovery Model Barton Biggs and Marc Faber think that investors should move out of bonds and back into stocks. On the other hand, the chief executive officer of bond giant Pimco - Mohamed El-Erian - says that most financial managers, investment officers and economists are erroneously assuming this will be a V-shaped recovery because they are "fighting the last war" instead of looking at what is really happening in the economy:
Poll: 70 Percent of Firms to Cut Jobs or Not Hire U.S. employers expect to hire more new workers in 2010 than they did in 2009, a sign the U.S. recession may be easing its grip, research showed on Tuesday. One-fifth of employers plan to add full-time, permanent employees next year, up from 14 percent in 2009, according to CareerBuilder.com, an online jobs site that surveyed more than 2,700 hiring managers and human resource professionals. Just 9 percent said they plan to cut head count in 2010, down from 16 percent in 2009, according to the nationwide survey.
Gold, silver to explode with 2010 treasury issuance Now that 2009 has come to a close, investors are looking forward to the happenings of 2010. One of the most important events is the issuance of nearly $2.2 trillion in Treasury bonds to fund government spending. Although $2.2 trillion seems relatively small compared to a federal debt just over $12 trillion, the size is magnified when you consider its impact on the markets.
2010: Deciding Year for Gold Is it prudent for investors to continue banking on gold in 2010 also after the unprecedented surge in prices of the yellow metal in 2009? Analysts are divided over this issue. With 2009 coming to an end and the global economic scene looking bright with India and China posting surprise economic growth, gold’s doomsday value has certainly come down. But still the yellow metal prices are on the rise showing no signs of a price correction. Gold closed at a record high of $1,215.30 in December, well up from its low of about $817 per ounce in January 2009.
Will gold boom again in 2010? AFTER the strengthening of the gold price by more than 20% – at one stage by 40% – since January, pundits are split over just how well the precious metal will fare next year. But three top experts do agree that it will be well above the price of just under $875 at which it began this year. This is despite gold failing to meet some expectations that it would enter the new decade at fresh highs. The yellow precious metal has climbed steadily through the year to end at 24% stronger than it began. Starting the year at a London fix of $874,50 an ounce, gold rallied through $1200/oz to hit a high of $1226,60 early this month.
Marc Faber on Economy Gold and Silver Part 1 of 3
Gold prices hold up as demand exceeds supply Gold has soared to record highs and there is no shortage of those wanting to get exposure to the precious metal, but will it all end in tears for investors? Gold shone brightly this year, but analysts are divided on whether 2010 could see some of the gloss fade. Gold closed at a record high of US$1215.30 (NZ$1715.73) in local trade on December 2, well up from its low of about US$817 an ounce in January.
Gold dips back below $1,100 as dollar rises Gold and other metals fell Tuesday in response to a stronger dollar, while energy futures eked out small gains. The price of gold ended a three-day winning streak, falling back below $1,100 as the dollar rose against other currencies. Gold for February delivery lost $9.80 to settle at $1,098.10 an ounce on the New York Mercantile Exchange. Gold is seen as a hedge against a weak dollar, so when the greenback rises, investors often sell the metal.
Gold's Volatility is Your Free Leverage "Gold is a high risk investment." Dec 27, 2009 - Martin Feldstein, former Chairman of Ronald Reagan's council of economic advisors and professor at Harvard. Gold is not a high risk investment. Martin is dead wrong. Gold is the lowest risk investment in the world. He is correct that the gold price is volatile, although it can be argued that the price volatility is because of the successful efforts of most world governments and the banksters to convince everyone that gold IS a high risk investment and an irrelevant asset.
US Mint Provides 2009 Fractional Gold Eagle Sell Out Figures 2009 Fractional American Gold Eagle bullion coins are in the history books with leading sales figures, despite their late launch and quick sell out. Having only been released on Dec. 3, 2009, the coins in the fractional sizes of one-half ounce, one-quarter ounce, and one-tenth ounce weights recorded smashing release day sales — 345,000 were sold for a total of 58,000 ounces of gold. On the very next day, the United States Mint announced that the supply of the smallest size was depleted, and that the other two sizes were nearly exhausted. It offered the remaining bullion coins in an allocated process, and then suspended sales until the final 2009 inventory was produced from available in house blank supplies.
Gold prices driven by huge investment demand . . . . Investment demand has been the main driver behind prices over the past couple of years and more so over the past several months. I think investors continue to be concerned over financial markets, economic conditions and political conditions as well. So I think with weak economic growth, with high unemployment, with what’s going on in Afghanistan, Iran, etc., you have increased concern. And investors continue to rush to safe-haven assets such as gold.
Peak Gold Pushes Prices Since 1999, global gold production has fallen 19% while gold prices have jumped 400%. Many analysts believe one of the contributing factors to prices' meteoric rise is the constriction of above ground gold stock. Above ground stock grows by 2,400 tons a year but as central banks shift from being net sellers of gold to net buyers and investor demand increases, gold supply tightens. If this trend continues, gold prices could see another spike up.
Marc Faber on Economy Gold and Silver Part 2 of 3
Gold rush grips China as people on buying spree As the year nears to a close and 2010 is all set to shine, there is gold glittering in the Chinese landscape. There is a mad gold rush going on across China as people are on the streets, swarming gold jewelry shops to buy coins, bars and ornaments during an year-end shopping spree. China is today the world's largest gold market. China recently overtook India and emerged as the largest gold consumer in the world. The dragon land is the largest global gold producer.
No full stops for central banks’ gold race In October this year, Reserve bank of India triggered a new wave among central banks across the globe, resulting in huge purchases of gold by them. With India leading the way with a 200 tonne gold purchase from the International Monetary Fund (IMF), other banks also followed suit by purchasing the yellow metal in bulk. Now, to add to that in 2009 European Central Bank (ECB) has decided to downsize its annual gold sale to 155 tonne. This move has further boosted the central banks’ crave for the yellow metal. Before this, Sri Lanka and Russia had purchased gold through their central banks.
U.S. Dollar and Gold Trends into 2010 The dollar finally broke through resistance at 23, which has turned into support. Price is backing up and testing support. The CCI index at the bottom of the chart has gone from overbought (+200) to 89. When an asset moves from being this overbought to back below 100, it often signals a consolidation/correction is likely. As reported last week, some commodities have been harder hit than others: gold and oil receiving the short end of the stick. This week, however, oil spiked up almost 5%, while gold stabilized. The daily USO (oil) chart shows a positive MACD crossover with the histograms turning up into positive territory as well.
U.S. Dollar, Gold Stocks and Inflation 2010 In his most recent work, Martin Armstrong postulates that because of accelerating inflation, possibly leading to hyperinflation, a falling dollar ($), cycles associated with his Economic Confidence Model (ECM), and a move away from immovable assets by the investing public, stocks are destined to hit new highs as measured by the various indices around the world, and that such a move could begin in earnest at any time. And while he does allow for an alternative scenario, one where stocks could most pessimistically test the March lows in 2011 (an ECM low), using the Dow for discussion purposes, according to Martin a more likely scenario is that allowing for volatility, 2010 should be characterize by a trading range between 12,500 and 8,800, with new highs possible as early as 2011, the inverse of the possible low discussed above.
Why is the U.S. Dollar Rising, Treasury Bond Market Failure 2010? Now am not a trader nor do I rely on charts but those who do, tell me that dollar has broken a “falling wedge” and is all set to rally a great deal in the coming weeks. Most research houses have put in dollar targets of anywhere between 78 and 83.
JP Morgan: 78
Morgan Stanley 82
CLSA 83
GS: They still cant believe dollar is rallying let alone leaving a target.
USD collapse 2012 and the end of the world as we know it Devolution of the USD 2012? - As the first public article for me just before 2010, it seems appropriate for me to comment on one of the biggest stories we will be all facing – that is an end game of events leading to the end of the USD. The implications for the world are no less than Armageddon – like. I mean it. Before we get into some details, I have been working on forecasts for 2010, and my study of the USD situation and how much time it has left. I first came to the conclusion that it was roughly (and I am getting close here on timing, I’m sure of this) two years from 2010. Actually, the calculation is two more years of relative USD functionality before the world realizes in about a shocking week’s time that the USD is just about to really go belly up. It’s not 5 years out anymore in my calculations, we have roughly two more years left.
In God We Trust I'm not here to preach today. Well, maybe I better take that back. I do want to persuade you of something. But we're not going to talk about religion. Unless you consider having faith in fiat a religion. I would call that having faith in False God's. If the dollar is your almighty god, then Pilgrim, I am here to convert you. Having faith in the dollar is not going to save you when hyperinflation hits.
Marc Faber on Economy Gold and Silver Part 3 of 3
U.S. Dollar Takes Temperature of Troubled World How is one to explain the wild gyrations in the international exchange value of the U.S. dollar in recent times over the past year or so? During one month it is falling fast, in another it is rising just as fast. Since early December, it has risen about 5 percent against the yen -- not a weak currency these days -- and almost as much against the euro. Some older-fashioned bankers must be yearning for the days of fixed exchange-rates, for a time when a national currency was attached to the steady price of gold. Alas, no more. So it is not just the U.S. dollar and other currencies, but also the spot prices of oil, gold and other commodities that fluctuate wildly in the world markets.
Elvis Has Left The Building In his most recent work, Martin Armstrong postulates that because of accelerating inflation, possibly leading to hyperinflation, a falling dollar ($), cycles associated with his Economic Confidence Model (ECM), and a move away from immovable assets by the investing public, stocks are destined to hit new highs as measured by the various indices around the world, and that such a move could begin in earnest at any time. And while he does allow for an alternative scenario, one where stocks could most pessimistically test the March lows in 2011 (an ECM low), using the Dow for discussion purposes, according to Martin a more likely scenario is that allowing for volatility, 2010 should be characterize by a trading range between 12,500 and 8,800, with new highs possible as early as 2011, the inverse of the possible low discussed above. Such an outcome would be predicated on 2009 finishing above 10,800 (1140 on the S&P 500[SPX]), and 12,000 next year. Without a doubt, if such an outcome were to unfold, I would also have few reservations about probabilities in this regard, this, and the likelihood of continued $ weakness.
Astonishing Inflation Data from the BLS I’m talking about inflation data courtesy of the Bureau of Labor Statistics (BLS). I find the stats startling because it’s proof positive that inflation is far from dead. And as I just mentioned, even more so because the BLS’s inflation data is contrived and manipulated to almost always show less inflation than there really is. Consider the following price increases which have occurred since the beginning of the financial crisis in October 2007. In the 24 month period since then, a time when deflation was supposedly striking everywhere …
Food and beverage prices increased an average of 5.6%
Cereal and bakery prices jumped 11.5%
Sugar and sweets prices, up 11.8%
Cooking oils, up 11.6%
Meanwhile …
The cost of medical care increased an average of 6.7%
Medical care services, up 7.1%
Hospital services, up 14.0%
The cost of education (tuition) at private schools jumped 10.7%
Educational books and supplies, up 14.9%
The bubble decade: Get-rich-quick lure of stocks, oil, mortgages led to trillion-dollar losses A string of exploding investment bubbles that started with the dot-coms and ended with mortgages and oil dominated the years from 2000 to 2009. And it looks like the next decade will be no different. It doesn't seem to matter to many hedge fund traders and other professional investors that the Standard&Poor's 500 index has turned in its first losing performance over the course of a decade, having fallen 23 per cent from 1,469.25 at the start of 2000 to its current 1,126.20. Or that they or other investors helped create and then destroy the bubbles that left stocks worth $2.5 trillion less today than when the decade began - and that's before adding in the effects of inflation.
John Hussman Says Stock Market Bulls Dancing on the Edge of a Cliff Last week, the dividend yield on the S&P 500 dropped below 2%, versus a historical average closer to double that level. While part of the reason for the paucity of yield in the current market can be explained by the 20% plunge in dividend payouts over the past year, as financial companies have cut or halted dividends to conserve cash, the fact is that current payouts are not at all out of line with their historical relationship to revenues, and even a full recovery of the past year's dividend cuts would still leave the yield at a paltry 2.5%. The October 1987 crash occurred from a yield of 2.65%, which was, at the time, the lowest yield observed in history, matched only by the 1972 peak prior to the brutal 1973-74 bear market.
Small Chinese Company Tells Goldman To Take A Hike, Refuses To Pay $80 Million In Derivative Losses It appears that even after thoroughly dominating the US legislative, judicial and executive branches, the long tentacles of the squid have been no better than the Mongolian hordes at overcoming the Chinese Wall (which is ironic seeking how easy it is to ignore the same construct internally between the firm's prop and flow traders...and yes, we will be posting our response to Goldman shortly, we have not forgotten). In the meantime, half a world away, a small Chinese power generator, Shenzhen Nanshan Power, is blatantly refusing to honor contracts with Goldman Subsidiary J. Aron for $80 million in derivative losses, and it appears that China itself has decided to stand behind the small company.
Liberty, Fannie & Freddie, Fed, housing
Are Banks Scamming Fannie? You remember the announcement that Fannie and Freddie would have an "unlimited" credit line from Treasury to cover shortfalls and buy-outs of defaulted loans from MBS, right? Well then, read this from the forum: After the Fannie news came out this weekend, a friend called me and his brother works for Chase Mortgage. He told me that Chase is redoing stated income loans and instead of actually appraising the home, they are going back 3 years on the homes valuation in order to get the loan processed. Then they are selling these mortgages to Fannie Mae. Yes, that's an anecdotal claim, but if true can someone explain to me how this isn't out-and-out fraud? Is Fannie requiring the actual appraisal with the loan package information they buy, or is the entire "verification" nothing more or less than a checkbox that says "yes, we have an appraisal"? Toxic waste dumping ground? Maybe.
Moody's: November credit card payments slip More U.S. credit card users fell further behind on their payments in November, Moody's Investor's Services said Tuesday. The charge-off rate on U.S. credit cards, as measured by Moody's Credit Card Index, rose to 10.56% last month after falling for the two previous months. October's charge-off rate was 10.04%. The charge-off rate measures those credit card account balances written off as uncollectible, as an annualized percentage of total outstanding principal balance. The record-high of 10.76% was reached in June.
Credit Card Writeoffs Rise, Could Get Worse U.S. credit card debts written off as uncollectible rose in November, following two consecutive months of decline, though early stage delinquencies dropped for the month, Moody's Investors Service said Tuesday. Credit card charge-offs rose by about one-half percentage point in November to 10.56 percent, and is likely to continue to rise to a peak of between 12 percent and 13 percent in mid-2010, Moody's said in a statement.
Ky. budget shortfall could exceed $1.5 billion Kentucky governor warns budget shortfall could surpass $1.5 billion over next 2 years Kentucky could be facing a budget shortfall of more than $1.5 billion over the next two years because of the economic recession, Gov. Steve Beshear said Tuesday. "We face a challenge much greater than many had anticipated," Beshear said at a Capitol news conference. "Obviously, this is going to require, more than ever before, a cooperative, bipartisan working relationship between the legislature and the governor's office if we are going to continue to move this state forward." The Democratic governor didn't rule out the possibility of furloughs or layoffs among the state's nearly 34,000 employees.
Local tax coffers fall lower nationwide In another ominous sign for state budgets nationwide, state and local governments reported another drop in overall tax revenue on Tuesday. General sales tax, individual income tax and corporate income tax were all down in the third quarter of 2009, resulting in an overall 6.7% drop in total tax revenue, compared to the same quarter in 2008, according to the U.S. Census Bureau. This is the fourth consecutive quarter in which tax revenue collection has fallen.
The Mother of All Balance Sheets Motrgage Backed Madness The Federal Reserve’s balance sheet has quietly ballooned back to near-record highs. The Fed announced yesterday that it’s balance sheet expanded to $2.22 trillion last week, it’s grossest level in nearly a year and just a hair from an all time high. Hmmm… if Mr. Bernanke assures us the recession is “very likely over,” then why is the Fed balance sheet in crisis mode? What are they worried about? Here’s the answer:
Shoplifters? Studies Say Keep an Eye on Workers Gift cards are just so easy — so easy for dishonest employees to exploit, that is. At the Saks flagship store in Manhattan, a 23-year-old sales clerk was caught recently ringing up $130,000 in false merchandise returns and siphoning the money onto a gift card. “Gift card fraud is spiking,” said Joshua Bamfield, author of the Global Retail Theft Barometer, an annual international survey of retailers. “To employees, this is like currency. It’s almost as good as the U.S. dollar.”
Illinois AG to Fed: End Incentives for High-Risk Mortgages Illinois’ attorney general Lisa Madigan urged the Federal Reserve to end financial incentives for loan officers and mortgage brokers for the types of loans written for borrowers. According to a statement from Madigan’s office, federal law allows lenders to receive bonus compensation based on the type of loan issued, meaning loan officers who place borrowers in higher risk, adjustable-rate mortgages may actually receive incentives to do so. An inquiry to the Fed was not immediately returned.
Atlanta home prices off 8.1 percent from last year Georgia home prices were essentially flat in October from a month earlier, but are still off significantly from the same period last year, according to a report issued Tuesday. According to the Standard & Poors/Case-Shiller Home Price Index, the price of a home in Atlanta declined 0.2 percent following monthly rebounds in price over the summer months. Still, prices overall are off 8.1 percent from October 2008, though that figure has narrowed. The report comes a week after the National Association of Realtors said the sales prices of existing homes in November rose 2.4 percent from the same period last year.
Stable Home Price Data Can't Dash Double Dip Fears U.S. home prices were unchanged in October, according to the widely watched Standard & Poor's/Case-Shiller indexes released on Tuesday, indicating stabilization in the hard-hit housing sector though the figures dashed hopes for a sixth straight monthly increase. The S&P composite index of home prices in 20 metropolitan areas was flat in October, falling short of expectations for a rise of 0.2 percent according to a Reuters survey. September's index was revised upward to a gain of 0.4 percent, from a previously reported 0.3 percent.
Home Prices Mask Signs of Weakness Just as the economy is finally beginning to strengthen, the real estate market is showing new signs of deterioration. Prices slipped in many cities in October, new figures show, despite low mortgage rates and a generous tax credit meant to spur sales. Now rates are starting to rise, making it harder for many buyers to afford a house, and the tax credit seems to be losing its capacity to lure them into the market.
Bad news for housing: Prices flattening Home price gains earlier this year flattened out in October, according to a report issued Tuesday. The S&P/Case Shiller Home Price index, covering 20 of the largest metropolitan areas in the nation, was unchanged in October, after four consecutive months of gains. The index is down 7.3% from 12 months earlier. "The turnaround in home prices seen in the spring and summer has faded," said David Blitzer, chairman of the Index Committee at Standard & Poor's, in a statement. "Coming after a series of solid gains, these data are likely to spark worries that home prices are about to take a second dip," he said.
Mortgage Rate Jump Could Choke Off Housing-Led Recovery As the 2010 approaches, a mix of housing market factors are falling into place which could lead to a very nasty start to the New Year for the U.S. economy. If predictions of soaring fixed mortgage rates come true and damper any nascent housing recovery, the United States could experience the double-dip recession many experts have warned is possible. Morgan Stanley now predicts 10-year Treasury bond yields will jump more than 40 percent next year, while 30-year fixed mortgages may surge more than 50 percent. The exploding budget deficit will do the damage, David Greenlaw, Morgan Stanley’s chief fixed income economist, told Bloomberg News.
What Soviet Medicine Teaches Us In 1918, the Soviet Union became the first country to promise universal "cradle-to-grave" healthcare coverage, to be accomplished through the complete socialization of medicine. The "right to health" became a "constitutional right" of Soviet citizens. The proclaimed advantages of this system were that it would "reduce costs" and eliminate the "waste" that stemmed from "unnecessary duplication and parallelism" — i.e., competition. These goals were similar to the ones declared by Mr. Obama and Ms. Pelosi — attractive and humane goals of universal coverage and low costs. What's not to like?
Health Care Nullification: Things Have Just Gotten Underway“The several States composing the United States of America, are not united on the principle of unlimited submission to their General Government.” ~ Thomas Jefferson For the past few days, I’ve received loads of e-mails urging me to get active regarding the healthcare vote – most of which had a subject line similar to: “Last Chance to Stop National Healthcare!” Well, if you believe the only way to protect your rights is by begging federal politicians to do what you want, then these e-mails are certainly right. The vote went as expected, and so will the next.
Consumer confidence rises, but still weak Americans are ending 2009 feeling better about the economy than when the year began, buoyed by optimism that job prospects will improve in the first half of 2010. Consumer expectations for the job market reached their highest level in two years, but most people remain downbeat about their current prospects, according to a monthly survey released Tuesday. The survey also showed that fewer people plan to buy automobiles and homes in the next six months, compared with November.
As defense agencies hire, other government workers get incentives to retire Uncle Sam may be hiring, but he's also trimming staff in some corners of the government, as agencies suffer through a budget squeeze or shift their focus. The federal government hired 97,445 people in the first nine months of 2009, mostly for the departments of Defense, Homeland Security and Veterans Affairs, according to the Office of Personnel Management. But just as new faces show up at some offices, seven agencies or departments hope to cut about 37,000 workers with buyouts and early-retirement offers.
GM offers dealers incentives on Pontiacs, Saturns General Motors is sweetening the deal to help blow out dwindling stocks of discontinued Pontiac and Saturn models. GM just told dealers that it will give them a $7,000 incentive for every leftover vehicle from either brand that they move into their rental or service fleets. They could then sell the vehicles to consumers and pass along some or all of the savings.
GMAC Said to Discuss $3 Billion or More in U.S. Aid GMAC Inc., the home and auto lender that counts the U.S. government as the largest stakeholder, is discussing with the Obama administration a third bailout of $3 billion to $4 billion, said a person familiar with the matter. The size of the assistance is under negotiation, the person said on condition of anonymity because the talks are private. A deal may be reached in days as Detroit-based GMAC incorporates losses from its home-loan businesses, the person said.
Japan: Slowly Going Broke We reported that the US government would need to roll over $2.5 trillion worth of debt next year. We probably erred. The number was right, but it was meant to be over the next two years. During the next two years also, worldwide, banks need to roll over $7 trillion. Whether it is over one year or two years, we’re talking big money. Most people who bother to think about it are coming to the conclusion that this is very inflationary…and very bullish for gold. They think the Fed will need to “monetize the debt” directly, or indirectly. One way or another, they say, the central bank will have to increase the volume of money so that the government can finance its deficits.
Estate tax set to expire Thursday Benjamin Franklin's maxim that "nothing is certain but death and taxes" remains true. But a congressional stalemate has left the federal estate tax, the levy on assets left to heirs, in doubt for at least part of 2010. The tax is poised to expire Thursday, though the House and Senate are expected to pass a reauthorization, possibly retroactive to Jan. 1, next year. In the meantime, what might seem like a potential tax savings has become a guessing game for taxpayers, accountants, estate planners and tax lawyers. The impasse also could mean capital gains taxes on more inheritances.
Is There a Constituency for Liberty in the U.S. Media? When I was a journalism student at the University of Tennessee 35 years ago, one thing we were told over and over again was that journalism served a "watchdog" role in keeping tabs on government. I had assumed (naïvely, of course) that the term "watchdog" meant serving as a counterforce against the predations of the state. Alas, what I have found that it really means is that modern journalists and their mainstream organs like the New York Times, Washington Post, Vanity Fair, Time and Newsweek, not to mention a gaggle of numerous smaller wannabe publications, are making sure that the state is using all of its powers and then some to push people into line. As a college professor who works on a faculty that is overwhelmingly left-liberal, the one thing I hear time and again from my colleagues is that people need a tough, "kick-ass" government to make them behave.
Ron Paul on Terrorism Congressman Ron Paul gives his thoughts on Yemen, the attempted airline bombing, the motivations of Al Qaeda, the radicalization of the Middle East, and the negation of our liberties to government provided "security."
Putin threatens new missiles to counter U.S. shield Russian Prime Minister Vladimir Putin warned Tuesday that Russia will have to go ahead with a new class of advanced offensive nuclear missiles if the United States continues with plans to develop a defensive missile shield. The powerful ex-president said in Vladivostok that the dispute was the main issue holding up negotiations on a new Strategic Arms Reduction Treaty (START).
US readying paralyzing Iran sanctions The US administration is heading towards placing "paralyzing" sanctions on Iran, Israeli Ambassador to Washington Michael Oren said Tuesday. Speaking to Army Radio, Oren added that although it was "too early," the US had also not yet abandoned the military option. "The Americans attribute the highest importance to the Iranian issue," he said during the interview. "The US, along with other countries, is preparing to impose paralyzing sanctions on [Iran], and preparations are happening even now."
Afghans Increasingly Turning to Taliban’s Shadow Govt NATO: Taliban Has 'Government in Waiting' Reports of a Taliban “shadow government” complete with its own court system are not new. Indeed, we’ve been covering the phenomenon for well over a year, and it has only grown as the group’s influence has gained. But to appreciate just how big and how credible this alternative government has gotten, one needs to closely examine its inner workings, particularly in regions where it has replaced the NATO-backed government for all intents and purposes.
Yemen: the new front in the fight against terror The trail of the foiled terrorist attempt to blow up a packed Northwest Airlines flight to Detroit on Christmas Day appears to lead to Yemen. At least the suspected attacker, Umar Farouk Abdulmutallab, 23, of Nigeria, has said in initial interrogation that al-Qaeda had trained him in Yemen and provided him with the explosive device. The poorhouse of the Arab world has suddenly come to the centre of international media attention. Will Yemen become the next front in the so-called "War on Terror?" With its impenetrable mountain ranges and rocky deserts, its tribes and clans following ancient laws of honour, Yemen does indeed provide an ideal terrain for terrorist training camps.
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Tues 12.29.2009
Patriot Radio News Hour Guest Host: Mark Call
Survey finds 'significant' anxiety about economy The majority of Americans say they still have "significant uncertainty and anxiety" about the nation's economy and are doubtful about a quick recovery in 2010. In a survey of 1,000 Americans by StrategyOne, 87 percent say the nation remains in a recession, despite economists' assertions, and 78 percent disagree with economists that the nation is on the rebound. Only one in four Americans polled said the economy will recover fully in the new year, and half say the economy won't be on track until the end of 2011 or 2012. Fifteen percent of respondents said they think the economy will never recover.
Brace For Impact: In 2010, Demand For US Fixed Income Has To Increase Elevenfold... Or Else As everyone is engrossed by assorted groundless Christmas (and other ongoing bear market) rallies, and oblivious to the debt monsters hiding in both the closet and under the bed, Zero Hedge has decided it is about time to present the ugliest truth faced by our 'intellectual superiors' and their Wall Street henchman who succeeded in pulling off Goal #1 for 2009 - the biggest ever bonus season (forget record bonuses in 2010... in fact, scratch any bonuses next year if what is likely to transpire in the upcoming 12 months does in fact occur).
Doug Casey on Bungling Ben . . . . Bernanke is always presented as a Ph.D., a scholar of the Great Depression, its causes, and how to cure such an economic downturn. But he hasn’t prevented an economic catastrophe – he’s done just the opposite of what needs to be done, and there’s going to be hell to pay. It’s quite perverse. Look at Alan Greenspan. In the 1960s, he was an acolyte of Ayn Rand and wrote a famous essay defending the gold standard, which I read in her book, Capitalism: The Unknown Ideal. And then he goes on to become the most inflationary Fed chairman in history until Bernanke superseded him.
Why I Fear for my Country For the first time I'm scared. I mean really scared. For the first time in my lifetime it looks like America may actually be coming to an end. As I traveled over the Thanksgiving and Christmas holidays I paid special attention to the public. At gas stations and shopping centers - I took the time to observe. We are doomed. These people have nothing, know nothing, and are not interested. Talk about rabble. As I spoke to members of my family at holiday celebrations - about topics foreign to me - like what's going on with their favorite TV show... my heart sank. No hope. As I browsed the web to see the most recent joke of a terrorist attack - just enough not to cause property damage but just enough to scare the cringing American soccer-moms - I just stared. The conversation in the background continued - I didn't participate.
Fannie, Freddie Changes Clear Way for 'Large-Scale' Buyouts The U.S. government's expanded capital backstops and portfolio limits for Fannie Mae and Freddie Mac increase "the prospect of large-scale" purchases by the companies of delinquent mortgages out of the securities they guarantee, according to Credit Suisse Group analysts. The Treasury Department announced Dec. 24 that the two mortgage-finance companies, which were seized by the U.S. almost 16 months ago, could tap an unlimited amount of capital for three years, up from as much as $200 billion each. It reworked caps on Fannie Mae and Freddie Mac's mortgage-asset portfolios to require the holdings to fall to $810 billion by Dec. 31, 2010, rather than about $690 billion.
U.S. may prop up housing further via Fannie, Freddie Unlimited support may presage more aggressive action in mortgage market The government's decision to provide unlimited support to Fannie Mae and Freddie Mac probably presages more aggressive action to prop up the U.S. housing market. The government may put a mortgage-modification effort, called the Home Affordable Modification Program, or HAMP, into overdrive in coming years, pushing for reductions in the principal outstanding on home loans overseen by Fannie and Freddie, Bose George, an analyst at Keefe, Bruyette & Woods, wrote in a note to investors Monday.
Fannie and Freddie: Wards of the State, Yet Management Receives Private Sector Pay Packages I was disappointed with the Christmas Eve ditties from Treasury and FHFA re: the Agencies. To be honest, I was appalled. The two releases contained significant information. The timing was obviously an attempt to slip in some bad news while everyone is drinking eggnog. Of course that backfired. The blogs, and yes, the MSM disintegrated those that sent the emails out on Christmas Eve. The smell that these announcements have created is not likely to go away anytime soon. If you are reading this you know the story. Treasury ponied up for another $200b for Fannie and Freddie and the management of these entities are getting serious paychecks.
Mortgage Anxieties Mean Limbo for Fannie and Freddie Fannie Mae and Freddie Mac, the linchpins of the American housing market, continue to bedevil the U.S. financial system. In February 2003, their regulator issued a report saying the companies were taking on too much risk by using implicit government backing to plunge deeper into the mortgage market. The government-sponsored enterprises would pose a systemic threat to the economy in the "remote" chance that either failed, Armando Falcon told the Bond Market Association the same day. The Bush administration, considering his report a potential threat to financial markets, asked him to resign.
pt 1- 12-24-09 Gerald Celente 2010 predictions
pt 2- 12-24-09 Gerald Celente 2010 predictions
Gold Bubble Debate: Is it wise to invest in gold? As 2009 is heading for a close, traders, investors and analysts are in the midst of mixed feelings of hope, dejection and euphoria. 2009 was not a bad year for investors in stocks and commodities compared to the year 2008 when we were bombarded with bank failures and the global economy teetering on the brink of collapse. Markets revived partially in 2009. Investors are now confident that markets will come back to a boom in 2010.
Analysts divided on gold Gold has soared to record highs and there is no shortage of those wanting to get exposure to the precious metal, but will it all end in tears for investors? Gold shone brightly in 2009, but analysts are divided on whether 2010 could see some of the gloss fade. Gold closed at a record high of US$1215.30 in local trade on December second, well up from its low of about US$817 per ounce in January.
Gold: the commodity of the year Even though copper and sugar prices have more than doubled this year, 2009's commodity of the year has to be gold. In fact, it's probably the investment of the decade. If you bought gold at the millennium, you would be sitting on gains of about 280pc. An investment in the FTSE 100 over the same period would have lost you more than 20pc of your capital. When dividends and inflation are taken into account you would have barely broken even.
The current bull market in gold is far from over. In fact it is only just beginning While it has come off its highs, gold is still up 30% this year and, many factors still point to a long term bull trend. As we see the end of another year, and even though the price of gold has come off its highs of over $1225, the price gold gained some 30% this year. Now, as the dollar rebounds from it's lows, and as most equity analyst are looking for global equities to continue upwards, there is talk that gold has made it's high. While we are all entitled to our opinions, I believe that these analysts fail to see the bigger picture and that the price of gold has a long way to go before this bull market peaks.
Dip in dollar lifts prices for gold, other metals; Grain prices rise sharply in light trading Gold and other metals inched higher in light trading Monday as the U.S. dollar dipped against other currencies. Energy and agriculture futures also rose as the ICE Futures U.S. dollar index, a widely used measure of the dollar against other currencies, slipped 0.1 per cent. A drop in the dollar makes commodities more attractive to foreign buyers.
Holiday Gold, Oil and Index Trading Another holiday trading extravaganza!!! Last week the market fell into its regular holiday tradition of light volume, as institutions and big traders enjoyed the holidays thus allowing prices to drift higher. We still have one more week of light trading volume before this year and holiday season is officially over.
Gold rises as investors bet on $US drop Gold rose in New York for the third straight session on speculation that the dollar will extend a slump, boosting demand for the metal as an alternative asset. The dollar pared gains of as much as 0.4 per cent against the euro after declining 1.1 per cent in the previous three sessions. Gold has climbed 25 per cent in 2009, heading for the ninth straight annual gain, while the dollar slid 2.9 per cent. "Gold’s moves will all be dollar-based now," said Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago. "Some pressure has come off the euro, and that’s allowed gold to come back."
Gold recovers some ground as year end approaches and dollar slips In light trading over the holiday period, the gold price has recovered a little, although major markets remain closed. Gold inched higher on Monday,helped by a recovery trend in the euro against the dollar, but trade was light as many investors stayed on the sidelines with U.S. and European markets closed since late last week for Christmas. Spot gold was up 0.8 percent at $1,112.35 an ounce as of 0710 GMT, compared with New York's notional close of $1,103.80 It has risen more than 25 percent so far this year. Spot gold fell to a seven-week low of $1,074.10 an ounce on Tuesday, but has since attracted bargain-hunting.
China Bullish on Silver
Gold: how high will the price go in 2010? Gold rose to a record high in 2009, but can it continue to rise above the $1,200/oz level, or will it fall back? "Notwithstanding the recent correction - and the possibility that gold may yet fall further before bargain hunters and other buyers (including central banks) reappear - the four pillars of gold-price strength remain intact. They are inflation-fueling US monetary and fiscal policies; Central bank reserve diversification with the official sector being a taker rather than a supplier of gold in 2009 and the next few years; expanding retail and institutional investor participation in the United States, China, and around the world; and declining world gold-mine production.
Why Gold Will be the "Greatest Trade Ever" . . . . Don't forget that gold's clocked a positive gain every year since 2001. Yet gold's run is far from over; rather, it's just getting warmed up... My research tells me we're currently in what I've labeled as "Stage Two" of the current bull market in gold. Stage Two begins when gold decouples from the dominant currency (something that's clearly already taking place against the U.S. dollar). The yellow metal then rises against most other currencies, as investment demand kicks in.
If Gold Goes To $5000, John Paulson Could Become The Richest Man In The World If gold ends up rocketing higher as bulls expect, it could turn John Paulson into one of the richest men in the entire world, if not the richest. This is because much of the world's wealthy lost money during the recent crisis and remain long the world economy, in contrast to Mr. Paulson.
Gold undervalued Jeffrey Nichols expects it to go to $1 500 in 2010, $2 000-$3 000 longer term. Gold has enjoyed a long and enviable climb, rising some 380 percent from a cyclical low near $255 an ounce in April 2001 to an all-time high just over $1,225 early this month. Nevertheless, the bull market in gold has a long way to go - both in magnitude and direction. Looking ahead to 2010, don't be surprised to see gold trade at $1,500 or higher sometime during the New Year. And that's not all: I've been telling clients that the yellow metal's price will continue its long-term upswing for at least a few more years, very likely reaching $2,000 an ounce . . . and possibly hitting $3,000 or more before the gold price cycle begins its next long-term cyclical "bear" phase.
Gold, Dollar, Euro: 2010 'Menage a Trois'? Gold hit a 7-week low on Dec. 22 from recent optimistic data of the U.S. economy. For example, U.S. existing housing sales jumped more than expected, and GDP grew at a 2.2% rate in the third quarter, the fastest pace in two years, amid a larger-than-expected downward revision. The upbeat news lifted the dollar and pushed yellow metal prices to below the $1,100 benchmark. Bullion has gained 23% this year on a strong inverse relationship to the Dollar as the longest recession since World War II eroded confidence in the dollar and boosted gold’s status as a safe haven.
Gold Is the Decade's Best . . . . We consider gold a legitimate asset class, and for that reason, we consistently suggest that investors consider a maximum 10 percent allocation to gold-related assets — half in bullion or bullion ETFs and the other half in gold equities — and that they rebalance each year to capture the swings. What the next decade will bring for gold? Who knows. But we do know one thing — those who held gold for the past 10 years will have a happier New Year than those who listened to the perma-skeptics.
Gold rush grips China as people on buying spree As the year nears to a close and 2010 is all set to shine, there is gold glittering in the Chinese landscape. There is a mad gold rush going on across China as people are on the streets, swarming gold jewellery shops to buy coins, bars and ornaments during an year-end shopping spree. China is today the world's largest gold market. China recently overtook India and emerged as the largest gold consumer in the world. The dragon land is the largest global gold producer.
Gold may rise on Asian central bank interest regardless of dollar Strong dollar equals falling gold price, right? Except, perhaps, when Asia's central bankers are involved. Three-quarters of the region's $5 trillion in foreign-exchange holdings are parked in U.S. dollars. A desire to diversify away from the greenback, though, has become evident. The dollar's share in reserve accumulation dropped to less than 30% in the third quarter, Barclays Capital estimates. Admittedly, knowing exactly what is in central bank reserves takes guesswork, but analysts think most diversification in 2009 favored the euro.
Lindsey Williams - Economic Dollar Collapse Amero Gold Silver
The Trade of the NEXT Decade No, dear reader…it’s not that simple. It never is. That’s true of almost everything…. The bond market has begun to sell off. The big question is: what does it mean? Is it A sell-off? Or THE sell-off? We’ve done well with our simple trade for the last ten years. We bought gold. We sold stocks. But what’s ahead? Will that be the best trade for the NEXT 10 years too? Or is it time to sell bonds, rather than stocks? Hmmm….
U.S. Dollar Down Overnight Higher global equity markets are helping to boost demand for higher yielding assets, leading to a rise in U.S. stock index futures. The lack of any significant economic reports is giving traders a free ride to the upside. There is no strong resistance at this time. Treasuries are trading lower once again. Demand for higher yielding assets and a weaker Dollar is helping to pressure March Treasury Bonds and March Treasury Notes. The T-Bonds are trading below a retracement level at 115'08. Regaining this area could trigger a short-covering rally.
Chandler Says Dollar Gains May Be a 'Head Fake' Before Year-End The dollar's most recent gains may be a "head fake" as investors close bets before the end of the year that the greenback will fall, said Marc Chandler, global head of currency strategy at Brown Brothers Harriman & Co. "I'm not sure this is the real thing," New York-based Chandler said in an interview on Bloomberg Radio. "It's sort of like a B movie and with the first large sound it's going to be a head fake."
Forecast 2010 : The center does not hold… but neither does the floor James Howard Kunstler There are always disagreements in a society, differences of opinion, and contested ideas, but I don't remember any period in my own longish life, even the Vietnam uproar, when the collective sense of purpose, intent, and self-confidence was so muddled in this country, so detached from reality. Obviously, in saying this I'm assuming that I have some reliable notion of what's real. I admit the possibility that I'm as mistaken as anyone else. But for the purpose of this exercise I'll ask you to regard me as a reliable narrator. Forecasting is a nasty job, usually thankless, often disappointing - but somebody's got to do it. There are so many variables in motion, and so much of that motion is driven by randomness, and the best one can do in forecasting amounts to offering up some guesses for whatever they are worth.
"Reasonably High Chance" Of Double Dip Coming Next Year Paul Krugman was on ABC's The Week on Sunday declaring a "reasonably high chance" of a double dip coming next year. Actually, he doesn't sound quite as gloomy as you might guess. Yes, he describes the entire recovery so far as being driven by government spending and inventory rebalancing, but the odds of a double dip he does place at lower than 50/50, so that's good. Obviously he wants much more spending.
Paul Krugman Talks More Stimulus
Foreign central bank U.S. debt holdings fell: Fed Foreign central banks' holdings of U.S. Treasuries and agency debt at the Federal Reserve fell in the latest week, data from the U.S. central bank showed on Monday. The combined holdings of Treasuries and agency securities by foreign central banks at the Fed fell $4.97 billion to a total of $2.954 trillion in the week ended December 23. Treasuries held by overseas central banks at the Fed fell $1.412 billion to total $2.185 trillion. Foreign central banks' holdings of securities issued or guaranteed by the two biggest U.S. mortgage financing agencies, Fannie Mae and Freddie Mac, fell by $3.557 billion to $769.433 billion in the latest week.
New Frontier Bank failure highlights weaknesses in inspections and oversight As state auditors combed through the files of the Colorado Division of Banking in 2003, they discovered glaring problems in how it inspects banks. They found the staff of examiners inadequate to glean critical detail from banks' books. They spotted inconsistencies in how they gauged financial weaknesses. And they discovered that inspectors did not follow up on fraud risks they detected at banks. "Colorado's average number of institutions per examiner was higher than all but one other state" in a six-state region, according to the Office of the State Auditor findings. It was the last audit of the Banking Division.
A Record $118 Billion In US Debt To Be Auction Off In Final Week Of The Year It wasn't long ago that the US government had never even sold $100 billion worth of debt in a single week. Now, in the final week of the year (and a shortened, holiday one at that), the Treasury is set to auction off a record-tying $118 billion. WSJ: With foreign buyers holding about half of the Treasury market, their continued appetite for government securities is essential in order to continue funding mounting budget shortfalls in the U.S. at historically low interest rates. The auctions will be the last offerings of Treasury debt for 2009, adding to a record net supply of $1.48 trillion for the year. They start Monday with $44 billion in two-year notes, followed by $42 billon in five-year notes Tuesday and $32 billion in seven-year notes Wednesday, all matching the amounts offered a month earlier.
Treasuries Little Changed on Concern 5-Year Sale Demand to Cool Treasuries were little changed, with two-year yields at the highest level since August, on concern demand at today’s sale of five-year notes will cool after yesterday’s two-year auction was the weakest in four months. The Treasury prepared to offer $42 billion of five-year notes today, following a $44 billion auction of two-year securities yesterday and before a $32 billion sale of seven- year debt tomorrow. Treasuries of all maturities have fallen 3.7 percent this year, according to Bank of America Merrill Lynch indexes. That would be the worst performance since at least 1978, when Merrill began collecting the data.
Eyes wide open and petal to the metal On Christmas Eve, in No Morals, No Hazard, I talked about Eric Sprott’s report "Is it all just a Ponzi scheme?", which suggests that $704 billion in purchases of US Treasuries cannot be accounted for, since they are on file as purchases by what the Federal Reserve Flow of Funds Report labels the "Household Sector", which, it turns out, doesn't exist. It's merely a name under which all unknown purchasers are grouped, while remaining unknown. The purchaser may be the Fed itself, unwilling to admit to more purchases than are already on file. Alternatively, as someone suggested, the Treasuries may never have been issued in the first place, and the entire thing may be an empty charade aimed solely at keeping up the appearance of a functioning US sovereign debt market.
Our 2009 Christopher Columbus Prize Beginning a new tradition, we give an award to the person who has done the dumbest thing in the financial world during the preceding 12 months. We call it the “Christopher Columbus Prize,” named after the mariner who didn’t know where he was going, didn’t know where he was when he got there, and as Churchill pointed out, did it all at government expense. Anyone can make a mistake. But to make a truly colossal blunder you need the support of the taxpayer. That’s why TIME magazine named Ben Bernanke its “Man of the Year.” Yes, you guessed it, he is our man too.
Krugman: 'Reasonably High Chance' the Economy Will Contract Nobel Prize winning economist Paul Krugman said he thinks there’s a “reasonably high chance” the economy will contract in the second half of next year. On the "This Week" Roundtable, Krugman said he agreed with the assessment of fellow Nobel-winning economist Joseph Stiglitz that there is a significant chance the economy will shrink in 2010. “I would go with Joseph Stiglitz,” Krugman added, “I’m really worried about the second half.”
Ponzi Collapses More Than Tripled in 2009 It was a rough year for Ponzi schemes. An Associated Press analysis of all 50 states shows that the recession caused nearly four times as many Ponzi scheme collapses in 2009 as there were in 2008. Tens of thousands of investors watched more than $16.5 billion disappear. That included the life savings of many people. Investors lost more money to such scams in 2008 thanks to the failure of Bernie Madoff's long-running scheme estimated at $21 billion to $50 billion.
Fed exit strategy: Let banks set up CDs Fed proposes letting banks set up equivalent of CDs as tool to drain money from economy The Federal Reserve on Monday proposed allowing banks to set up the equivalent of certificates of deposit at the central bank, a move that would help the Fed mop up money pumped into the economy and prevent inflation from taking off later. Under the proposal, the Fed would offer so-called "term deposits" that would pay interest. Doing so would provide banks with another incentive to park their money at the Fed, rather than having it flow back into the economy.
War on Wall Street as Congress Sees Returning to Glass-Steagall A one-page proposal gaining traction in Congress could turn back the clock on Wall Street 10 years, forcing the breakup of banks, including Citigroup Inc. Lawmakers in both parties, seeking to prevent future financial crises while soothing public anger over bailouts and bonuses, are turning to an approach that's both simple and transformative: re-imposing sections of the 1933 Glass-Steagall Act that separated commercial and investment banking.
Feds probe banker Allen Stanford's ties to Congress The ties between indicted banker Allen Stanford and members of Congress -- including millions in contributions and weekends in five-star Caribbean resorts -- are now the subject of a sweeping federal investigation. Just hours after federal agents charged banker Allen Stanford with fleecing investors of $7 billion, the disgraced financier received a message from one of Congress' most powerful members, Pete Sessions. "I love you and believe in you," said the e-mail sent on Feb. 17. "If you want my ear/voice -- e-mail," it said, signed "Pete." The message from the chair of the National Republican Congressional Committee represents one of the many ties between members of Congress and the indicted banker that have caught the attention of federal agents. The Justice Department is investigating millions of dollars Stanford and his staff contributed to lawmakers over the past decade to determine if the banker received special favors from politicians while building his spectacular offshore bank in Antigua, The Miami Herald has learned.
Nathaniel Rothschild Said to Be Rusal IPO Investor Nathaniel Rothschild's private investment company may buy shares in United Co. Rusal's $2 billion Hong Kong initial public offering, said three people familiar with the plan. Paulson & Co., the New York hedge fund run by billionaire John Paulson, and the Russian state-owned development bank Vnesheconombank also may be among so-called "cornerstone" investors guaranteed shares in the IPO in exchange for a pledge not to sell them for a number of months, the people said. They declined to be identified because the information is private.
The Recession Begins Flooding Into the Courts New York State’s courts are closing the year with 4.7 million cases — the highest tally ever — and new statistics suggest that courtrooms are now seeing the delayed result of the country’s economic collapse. The Great Recession may be showing signs of easing, but the legal fallout from the financial troubles, the numbers suggest, may have only just begun. And the increase in New York offers a preview of the recession-related cases showing up in courts across the nation.
Assisted Living: Back to the Future It's right in my neighborhood, so I've probably driven past that gracious Victorian house, painted a dusty rose, a zillion times. But because it looks like many other houses in Montclair, N.J. - big old trees, nice landscaping, wraparound deck - I never realized that it was an assisted living facility. Ever since a 1990's building boom, the term "assisted living" has conjured up mental images of a three-story stucco building on a highway, with a brass chandelier in the lobby and a "concierge" desk. But long before those places began popping up, many owned by regional and national chains, lots of smaller, homier residences for seniors were tucked into ordinary neighborhoods.
Seniors Worry About Medicare Advantage Cuts Insurers constantly caution seniors that their Medicare Advantage perks such as hearing aids, dental payments and even gym memberships will fizzle if Democrats get their way and cut government subsidies for them. But tens of billions of Medicare dollars funneled through insurers also pay for extras that never reach beneficiaries: multimillion-dollar salaries, executive retreats in Hawaii, Scotland and Cancun, and massive expenditures on marketing to lure more customers to the privately administered Advantage plans that serve as an alternative to government-provided Medicare.
Democrats Say Final Health-Care Bill Will Look Like Senate's Any health-care legislation that reaches President Barack Obama's desk will be close to the version the Senate passed last week, top Democrats said yesterday. The Senate garnered the minimum 60 votes needed to overcome Republican objections and pass its measure overhauling health care, and any major changes would jeopardize final approval, said Senator Bob Menendez of New Jersey, chairman of the Democratic Senate Campaign Committee.
Healthcare Reform is a Lump of Coal Ron Paul Last week on Christmas Eve, after many backroom deals were made, the Senate passed the healthcare reform bill with a strictly partisan vote. I was pleased that my colleagues in the GOP are on the right side of this bill. Although this vote was a major step in healthcare reform becoming reality, they still have to reconcile the Senate bill with the House-passed version in conference committee. This could prove even more difficult and costly than the Senate vote. There was a little bit of controversy surrounding one particular Senator who was initially against the bill, but then, coincidentally, a large amount of Medicare funding specifically for his state was tucked inside and he ended up voting for it. One wonders how much more of that will have to go on to achieve final passage.
Health Care, The "Patriot" Act & the U.S. Constitution
D.C. housing market's collapse lessens developers' swagger In the go-go years of the housing boom, in one of Washington's hippest neighborhoods, Scott Pannick built more than 300 loft-style condos, many of them attracting fevered bids even before their gourmet kitchens were installed. "Sold just like that," Pannick recalled, snapping his fingers. That was before the housing market collapsed, before Pannick's lender seized his last modern design -- the glass, steel and brick Metropole on 15th Street NW. In September 2008, days after the fall of Lehman Brothers, Pannick trumpeted the opening of the Metropole by throwing a Hollywood-style theme party, with cigarette girls, spotlights and pink champagne.
Higher-End Homes Face Price Pressure Though the cheapest houses on the market may not get much cheaper, more-expensive homes still have further to fall, which will likely slow the broader housing recovery. The Standard & Poor's/Case-Shiller home-price indexes for October are due on Tuesday morning. Economists estimate the index tracking prices in 20 major cities was down 7.7% from a year ago. That would mark the smallest year-over-year decline since November 2007, but would also leave prices slightly lower than in September, ending a four-month string of month-to-month improvements. That might cause some anxiety about the housing recovery. Despite recent signs of a bottom, many observers expect home prices to fall an additional 10% before the bust ends.
Global Agenda: How's your house It's worth keeping an eye on the American housing market - after all, that's where the bubble developed and burst, and that's where the big trouble began, eventually encompassing the entire economy and then the whole world. The problem is that, at any rate at first blush, it's difficult to make sense of what is happening. There's no need to look further than the most recent data, published this week, to become thoroughly confused. What is one to make of the fact that sales of existing homes are rising sharply and seem to be recovering well from the slump, while sales of new homes fell sharply and have barely risen from the lowest levels they plumbed earlier this year?
Stranded by Arrow Trucking, employees strike back with lawsuit The class-action lawsuit claims that Arrow Trucking violated federal laws by not giving employees 60 days' notice of the shutdown. A class-action lawsuit against Arrow Trucking was expected to be filed in federal court Monday. A principal charge: The Tulsa, Okla., flatbed carrier broke federal law by not giving its employees 60 days' notice about its precarious financial state. Instead, Arrow last week stranded hundreds of its drivers around the country. Many of them found out their employer was shutting down when their company-issued fuel cards wouldn't work. On Tuesday, the company abruptly told its headquarters staff to pack up and go home. "It was just outrageous conduct, I think, to do it on the eve of Christmas," said Chuck Ercole, an attorney with Klehr Harrison Harvey Branzburg LLP in Philadelphia. "People's paychecks on the 15th bounced."
Information on Arrow Trucking shutdown:
TheBobChapmanChannel --Dec 24 2009 part 1
TheBobChapmanChannel --Dec 24 2009 part 2
Rolling in Dough, Still Kicking Out Families Goldman Sachs Subsidiary Among 'Loan Servicers' Collecting Criticism There's no place like home for the holidays. But this year, Phil and Barb Kubes and their three children will have to settle for memories of Christmas past. Last month, the Omaha, Neb., family was forced out of their home of 12 years after falling drastically behind on mortgage payments. Having failed to reach a workable solution with Litton Loan Servicing, the Houston-based company that collects their mortgage debt, the Kubes were foreclosed upon and told to vacate. They ended up renting a house across town.
Tribes buy back America - acres at a time Purchases to help protect culture, way of life by preserving sacred areas OMAHA, Nebraska - Native American tribes tired of waiting for the U.S. government to honor centuries-old treaties are buying back land where their ancestors lived and putting it in federal trust. Native Americans say the purchases will help protect their culture and way of life by preserving burial grounds and areas where sacred rituals are held. They also provide land for farming, timber and other efforts to make the tribes self-sustaining.
Weak economy motivates Americans to save more As crazy as it sounds, losing a $70,000-a-year job has been good for Marty Morua's finances. The former Wall Street stockbroker says the setback forced him to scrutinize his family budget and snip away at expenses. And soon, even with less income, their savings grew. First, he and his wife decided to live on her salary so he could be home with their 5-year-old daughter after school. Without a nanny, they saved $12,000 a year. He dropped services he didn't use on his cellphone -- texting and video games -- to pocket $250 a year. He took a defensive-driving course for a 10 percent discount on his auto insurance and dropped car-rental and roadside-assistance coverage, for an extra $150 a year.
Most important civil right of all Well, to paraphrase a famous president of a slightly earlier time, "you're doing a heckuva job, Janet." That goes for everybody at the White House. If Barack Obama wants to reassure a nervous public that bureaucratic incompetence won't be tolerated, he might look to the example of what happened to the director of FEMA in the wake of Hurricane Katrina. But no one expects the president to sack Janet Napolitano, the secretary of something the government insists on calling Homeland Security. That's not how an administration that regards words and deeds as equals actually works. The lessons in the latest Islamist attempt to bring down a Western airliner could be useful, but such lessons are too painful for the guvvies to think about.
Wither Sovereignty Executive Order Amended to Immunize INTERPOL In America - Is The ICC Next? Last Thursday, December 17, 2009, The White House released an Executive Order "Amending Executive Order 12425." It grants INTERPOL (International Criminal Police Organization) a new level of full diplomatic immunity afforded to foreign embassies and select other "International Organizations" as set forth in the United States International Organizations Immunities Act of 1945. By removing language from President Reagan's 1983 Executive Order 12425, this international law enforcement body now operates - now operates - on American soil beyond the reach of our own top law enforcement arm, the FBI, and is immune from Freedom Of Information Act (FOIA) requests.
pt 1/4 Destruction of Freedom, Police State | MEP Nigel Farage on KWN Many US Citizens that follow European Politics are deeply concerned the the United States is following Europe into a post democratic age. Nigel Farage is currently a Member of European Parliament/MEP and a founding member of the United Kingdom Independence Party/UKIP. Nigel has become legendary in all EU countries as a voice of the people is Europe. The EU is now appointing people without going through the election process and many feel that even when they do have an election it consists of several politicians from different parties but the same agenda. Nigel has taken on the establishment and with his tremendous leadership he has given others the courage to stand up against an onslaught of injustices against the people. This interview is a glimpse into what Americas future may soon look like if our government continues to follow the EU mold. In this interview the unbelievable clips from his exchange in the EU are heard and snapshots above are taken from the video of this incredible exchange. Nigel also discusses the losses of freedoms in Europe, the police state which is enveloping the people of the European Union, the hijacking of democracy which has taken place in Europe, the injustice of the appointing of European leaders rather than by traditional democratic election, why he has decided to fight for the people, the Lisbon Treaty, cap & trade and much more.
pt 2/4 Destruction of Freedom, Police State | MEP Nigel Farage on KWN
pt 3/4 Destruction of Freedom, Police State | MEP Nigel Farage on KWN
pt 4/4 Destruction of Freedom, Police State | MEP Nigel Farage on KWN
Have Americans Traded Freedom for Security? Obama’s dwindling band of true believers has taken heart that their man has finally delivered on one of his many promises – the closing of the Guantánamo prison. But the prison is not being closed. It is being moved to Illinois, if the Republicans permit. In truth, Obama has handed his supporters another defeat. Closing Guantánamo meant ceasing to hold people in violation of our legal principles of habeas corpus and due process and ceasing to torture them in violation of U.S. and international laws. All Obama would be doing would be moving 100 people, against whom the U.S. government is unable to bring a case, from the prison in Guantánamo to a prison in Thomson, Illinois.
Al Qaeda takes credit for plot to down plane Al Qaeda in the Arabian Peninsula claimed responsibility on Monday for the unsuccessful Christmas Day effort to bring down a jet over Detroit, while the Obama administration rushed to deal with the political fallout from the attack. President Obama issued his first statement on the attack, telling Americans that his government was doing everything in its power to keep them safe. Hours earlier, the homeland security secretary backed away from her Sunday comments that "the system worked."
Napolitano Now Says Airline Security System Failed Homeland Security Secretary Janet Napolitano conceded Monday that the aviation security system failed when a young man on a watchlist with a U.S. visa in his pocket and a powerful explosive hidden on his body was allowed to board a fight from Amsterdam to Detroit. The Obama administration has ordered investigations into the two areas of aviation security -- how travelers are placed on watch lists and how passengers are screened -- as critics questioned how the 23-year-old Nigerian man charged in the airliner attack was allowed to board the Dec. 25 flight.
More Pilot Discretion on Security Measures The heightened security measures faced by air travelers in the United States and worldwide during the weekend were eased somewhat on Monday, the first business day after Friday’s terrorism incident on a jet bound to Detroit from Amsterdam, federal officials said. But airlines still delayed and canceled flights in response to the measures, and blamed the disruptions on the security moves. And Canadian officials, seeking to reduce the backlog at the security checkpoints, have effectively banned carry-on luggage for passengers heading to the United States.
Smart-grid efforts will receive $200B, report says Governments and utilities are expected to spend a cumulative $200 billion on smart-grid technologies from 2008 through 2015, according to a report released Monday by Pike Research. The research firm, based in Boulder, Colo., found that utilities will find the best return on their investment, and predicted they'll invest most of their capital budgets in smart-grid infrastructure projects. "Smart grid" is a term used to describe technological innovations to help conserve energy, such as "smart meters," which allow homeowners to cut down on electricity usage.
Yen to Fall Versus Dollar in '10 as Rates Diverge The yen may weaken to 95 to the dollar by the end of next year as deflation keeps the Bank of Japan from following interest-rate increases by the Federal Reserve, based on the median estimate of 12 Tokyo-based analysts. Eleven of those surveyed by Bloomberg News expect the yen to decline versus the dollar from the end of March to Dec. 31. Futures prices show the U.S. central bank may start raising rates as soon as June, whereas Bank of Japan Governor Masaaki Shirakawa has pledged to keep rates "persistently" near zero to fight deflation.
Brazilian Real Advances on Strength of Several Transactions Brazil's real rose the most among major currencies after a few "large" dollar sales by investors, said Luiz Roberto Monteiro, currency manager of Corretora Souza Barros in Sao Paulo. "We detected a $200 million transaction by a state-owned company and there are more operations like that today," Monteiro said in a telephone interview. He declined to identify the company. Low liquidity due to the Christmas and New Year's holidays is also contributing to the large move in the real, Monteiro said.
Colombia Growth in 2010 May Be Cut by Venezuela Colombian Finance Minister Oscar Ivan Zuluaga said Venezuela's move to freeze trade between the countries will reduce economic growth next year. Exports to Venezuela may fall by about half to $2 billion next year, Zuluaga said today in an interview in Bogota. Exporters are diversifying by sending more goods to Mexico, Peru, Central America and the Caribbean, Zuluaga said. "The government's basic premise is that Venezuela's economic problems will continue and the exports will remain below what they reached in recent years," Zuluaga said. "This is the most realistic outlook."
Venezuelan President Threatens To Nationalize Toyota CARACAS, Venezuela — Venezuelan president Hugo Chávez has threatened to nationalize Toyota Motor's assembly plant and turn it over to a Chinese company. The incendiary statement came as Chávez accused Toyota of failing to produce enough vehicles appropriate for rural areas of the South American country. He made the same threat to Fiat and General Motors, which also operate plants in the country and also said the international automakers are not transferring enough of their corporate new technology to local plants.
China to Cool Property Prices, Resist Yuan Pressure Chinese Premier Wen Jiabao said the government will cool property prices, resist pressure for the yuan to appreciate and keep inflation at "reasonable" levels. "Property prices have risen too quickly in some areas and we should use taxes and loan interest rates to stabilize" them, Wen said yesterday in an online interview with the official Xinhua News Agency. China will "absolutely not yield" to calls for currency gains, he said.
Who Will Blink First? Iran has responded to America's end-of-the-year, engagement-or-else deadline by, among other things, test firing upgraded long-range missiles and temporarily seizing control of an Iraqi oil field. The latter incident, it has been widely reported, is not unusual. Since the Iran-Iraq War ended in 1988, there have been frequent territorial disputes along the border that separates the two nations. But as George Friedman noted at Stratfor on Monday, given the broader context of the current high-stakes showdown between the United States and Iran, the cross-border raid cannot be dismissed as insignificant.
Iran Sanctions are Precursor to War Ron Paul Last week the House overwhelmingly approved a measure to put a new round of sanctions on Iran. If this measure passes the Senate, the United States could no longer do business with anyone who sold refined petroleum products to Iran or helped them develop their ability to refine their own petroleum. The sad thing is that many of my colleagues voted for this measure because they felt it would deflect a military engagement with Iran. I would put the question to them, how would Congress react if another government threatened our critical trading partners in this way? Would we not view it as asking for war?
Iran divide deepens after arrests Iranian authorities on Monday arrested about a dozen reformists, including senior aides to opposition leaders, in a fresh crackdown following mass protests in Tehran and elsewhere at the weekend. At least three allies of Mir-Hossein Moussavi, the opposition leader, who claimed victory in Iran’s disputed presidential election in June, and two aides to Mohammad Khatami, the former president, have been detained. Ibrahim Yazdi, the head of the Freedom Movement of Iran, a religious nationalist party, and several reform-minded clerics in the holy city of Qom, were also held. No official reason was given for the arrests, which seem certain to deepen the antagonism between the government and the reform movement.
Maverick Iraqi politician claims Iran could go nuclear within weeks Iraqi parliamentarian Mithal al-Alusi is warning that Iran is much closer to attaining nuclear capability than most sources, including the International Atomic Energy Agency and the US State Department, believe. In fact, he predicts the Iranians could have a nuclear capability - and may announce that they have it - as soon as next month. "We are receiving information which says Iran is so close to producing an atom bomb," Alusi said in an interview earlier this month, the latest in a series of interviews conducted since September. "All the international community, they don't realize how close [the Iranians] are to the goal... The Iranians will surprise us one day [soon] and say, 'We have it.'"
UAE Splits the Atom Club It is hard to imagine a more politically sensitive new energy project than the Arab world's first nuclear power plants. But by awarding the $20.4 billion contract to a group of South Korean companies, the United Arab Emirates has shrugged off lobbying from Washington and Paris and gone for the cheapest and simplest industrial option. The U.A.E. has sent a message it is open to foreign investors without close political, military or oil-industry ties. And South Korea's victory suggests the nuclear industry is less of an oligopoly than commonly perceived. The consortium led by Korea Electric Power defeated bids led by America's General Electric and by France's Electricité de France and Areva.
Peres hosts Christian leaders, stresses commitment to freedom of religion President Shimon Peres hosted a traditional ceremony at his official Jerusalem residence on Monday to welcome the Christian leadership in Israel. Peres offered his blessings to hundreds of Christian leaders, wishing them a "Happy New Year and a Merry Christmas." The president also stressed Israel's fundamental commitment to freedom of religion, in Jerusalem and the holy sites. "It is Israel's responsibility to make sure every believer can pray to his or her Lord without interruption," he said. "Israel is deeply committed to protecting the holy sites for every religion. We will not tolerate any offense toward any church, mosque or synagogue."
Critical Currents: The European connection The status of Israeli-Palestinian relations depends more on the fate of health reform in the United States than on any other factor - or so conventional wisdom here has it. This approach suits the present Netanyahu government's strategy well: It allows for ongoing diversions in the hope of delaying - and perhaps ultimately obviating - any serious movement on a viable political settlement. But it completely disregards the changing international climate in general and the new currents emanating from Europe in particular. The US without a doubt has played in the past and continues to play a lead role in determining the terms and the pace of progress toward resolution of the conflict. It is not, however, the only player. Increasingly Europe, for many years content to take a back seat to Washington, is becoming a more vocal political (as well as economic and security) actor. This is being done with American foreknowledge, if not actual encouragement.
Israel Concerned About Strengthening Egypt-Iran Axis Iran and Egypt have taken strides to bolster ties in their first round of high-level talks since 1979. On December 20, Egypt's ailing and aged president, Hosni Mubarak, received a rare two-hour, face-to-face visit from Iranian Parliament Speaker Ali Larijani. Larijani had flown to Cairo to represent Tehran at a committee meeting for member states of the Parliamentary Union of the Organization of the Islamic Conference. In addition to the meeting with Mubarak, Larijani also held talks with his counterpart Ahmed Fathi Surur and Egyptian Foreign Minister Ahmed Aboul Gheit. According to the Los Angeles Times, Egyptian sources said that Iranian President Mahmoud Ahmadinejad is trying to bring an end to tensions between his country and Egypt.
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Mon 12.28.2009
Patriot Radio News Hour Guest host: Mark Call
Back From the Brink (but Watch Your Step) UNLESS you’re Tiger Woods, 2009 has probably been a heck of a lot better than 2008. Last year, most Americans felt as if they had been hit in the head by a 4-iron. Wall Street nearly collapsed. The economy plunged into its deepest recession in decades. As housing prices sank, many homeowners realized that they owed more on their mortgages than their homes were worth. Millions lost their jobs, and even those who didn’t hunkered down, burying their wallets in the backyard. This year — with more than a few bumps along the way — the situation brightened. The stock market surged, and the housing and auto markets appeared to have bottomed out. Demand for certain tech toys like smartphones, which allow people to check e-mail, surf the Web and play games, perked up.
Of Christmas, War and Peace “And this shall be a sign unto you: You shall find the infant wrapped in swaddling clothes, and laid in a manger. “And suddenly there was with the Angel a multitude of the heavenly army, praising God, and saying: Glory to God in the highest and on earth, peace to men of good will.” Here the argument begins. Is it biblical to say, “Peace on earth and good will to men,” which is inclusive but inexact? Or does that dilute and distort the meaning of “Peace on earth to men of good will,” which is restrictive? The former, while ecumenical, seems pacifist. Do we wish good will today to al-Qaida? And is not the chorus singing out peace on earth “to men of good will” at the first Christmas a “heavenly army”?
Fragile U.S. Economy Under Increasing Stress from Escalating Afghanistan War Sherwood Ross writes: If Iraq war spending helped plunge the U.S. economy into its worst slump since the Depression, what does President Obama think his escalation of the Afghan war will do it? Besides forcing taxpayers to cough up fresh billions to enable the Pentagon to chase down a few hundred Taliban fighters, the Afghan war is liable to continue to inflate oil prices---and this means more than the ongoing swindle of motorists at the pump. Higher oil prices also slow the global economy, causing our trading partners to buy fewer Made-in-USA goods, thus reducing demand for our products and leading to layoffs. Spending money on war also siphons billions of dollars from truly productive uses.
South Korea to Build Reactors in Middle East The United Arab Emirates said Sunday that it had chosen a South Korean-led consortium for a $20 billion contract to create the first nuclear power reactors in the Middle East. The Korean consortium beat out a General Electric-Hitachi team and a French consortium that included Électricité de France and Areva. The deal, one of the largest in the energy sector this year, comes amid a resurgence of nuclear power projects and had involved prominent lobbying from officials including the presidents Nicolas Sarkozy of France and Lee Myung-bak of South Korea.
The Economic Crisis Ends 2009, the Political Crisis Begins 2010 First Iceland, then Ireland, now Greece. Much of Europe is mired in inescapable debt and bankrupt nations, the result of crashing banks, bank bailouts, and soaring unemployment. The U.S. and U.K. watch from a distance, knowing their turn is next. The European corporate-elite — like their American counterparts — lavished non-stop praise on the “bold yet necessary” decision to bail out the banks; the economy was supposedly saved from “impending collapse.” But every action has an equal but opposite reaction. Bailing out the banks saved the butts of dozens of European bankers, but now millions of workers are about to experience a thundering kick in the ass.
We're Screwed! ShadowStats.com founder John Williams explains the risk of hyperinflation. Worst-case scenario? Rioting in the streets and devolution to a bartering system. Do you believe everything the government tells you? Economist and statistician John Williams sure doesn't. Williams, who has consulted for individuals and Fortune 500 companies, now uncovers the truth behind the U.S. government's economic numbers on his Web site at ShadowStats.com. Williams says, over the last several decades, the feds have been infusing their data with optimistic biases to make the economy seem far rosier than it really is. His site reruns the numbers using the original methodology. What he found was not good.
An Introspective Look at the Future of America As we close out 2009 and look forward into 2010 and beyond, this has been a year of near financial catastrophe and monumental change, none of which benefited America or ordinary Americans. Late in 2008 and throughout 2009, events have happened in the US which would have been labeled unfathomable just a few short years ago, and yet already these monumental changes are expected to be filed into the memory hole and Americans are expected to believe nothing has changed.
Renegade Economist Christmas Special with Max Keiser
Obamacare sparking 10th Amendment rebellion, action in seven states Looks like the steadily growing list of constitutional, ethical and political outrages that constitute the Harry Reid version of Obamacare is sparking a rebellion in the states, as AP reports South Carolina's attorney general plans to investigate the vote-buying that surrounded the proposal in the Senate majority leader's office. According to AP, South Carolina's Henry McMaster is being joined by the attorneys general of Michigan and Washington state in a suit to determine the constitutionality of the Obamacare proposal. Their initiative was prompted by a request from South Carolina's two senators, Lindsay Graham and Jim DeMint, both Republicans.
“The Last Time That Happened Was During the Great Depression” Until a few years ago, running a U.S. city was pretty easy. You added services when voters asked, you hired more workers (who were likely to vote for you come election time) to provide the services, and you promised lavish retirement benefits to cops and teachers who weren’t going to retire until long after you left office. If tax revenues didn’t cover day-to-day operations, no problem; Washington was sending plenty of aid to make up the difference. No longer. The gap between what a typical city gets from sales and property taxes and what it owes its employees is a now a chasm that even trillions in federal stimulus money can’t fill. So for the first time in most Americans’ memory, cities actually have to live within their means. The result, according to today’s Wall Street Journal, isn’t pretty.
NIB to stop handling cash One of the country's larger banks has told to its customers that it is to stop handling cash in its branches. National Irish Bank says it is moving to a Scandinavian model of "cashless banking" - with an increased reliance on ATMs and debit cards. NIB has told customers that its branches will no longer handle cash withdrawals or lodgements, nightsafe lodgements or foreign exchange cash. They are instead urging customers to use ATMs or get cash back on their laser cards if they need notes. Branches will continue to accept cheques and postal orders.
Gold inches higher in light trade TOKYO, Dec 28 (Reuters) - Gold inched higher on Monday in light trading as many investors stayed to the sidelines after U.S. and European markets were closed late last week for Christmas.
Gold ends above $1,100 as greenback weakens Gold futures on the COMEX Division of the New York Mercantile Exchange returned above 1,100 dollars on Thursday on weak dollar. Silver and platinum both rallied. The most active gold contract for February delivery gained 10.80 U.S. dollars, or 1 percent, to finish at 1,104.80 dollars an ounce. Dollar failed to climb higher despite economic data provided some early-morning support and slowed earlier losses. The U.S. durable goods orders showed healthy growth in business capital expenditures for the month of November, while initial jobless claims data showed that fresh unemployment insurance claims fell to their lowest levels in 15 months.
Gold Recovers as USD Rally Slows Gold prices recovered the past two days as the rally in the USD halted after the release of a disappointing New Home Sales report yesterday. With the greenback under pressure and extremely low levels for Gold, investors have take advantage of the low prices to return investing in Gold. Gold for immediate delivery gained $17.05, or 1.6% to $1,104.60 today.
A PRACTICAL GUIDE TO “GOLD CLAUSES” As most of my readers know, I have long advocated the use of alternative currencies, consisting of silver and gold, in order to return America to constitutional and sound money. There are three means by which such alternative currencies could be introduced into the economy: (i) through an act of Congress; (ii) by State legislation, one State at a time; and (iii) by the private action of individuals. At the present time, option (i) is likely impossible; and option (ii) will require a fair amount of political organizing and “grass-roots” lobbying in suitable “target” States before the first such statute can be enacted. For the time being, then, that leaves option (iii) as the only way to move ahead immediately. Of course, purely private action alone cannot reform even one State’s monetary system.
Peter Schiff on Goldseekradio.com
Gold and Silver Forecast Update What a month for gold and silver as they peaked and crashed by over 10% this month. But instead of being disappointed, I think this is the perfect fodder and stage for the next super fast bull rally. In fact the next move will be among the powerful and sustainable rallies in 7 year bull run of Gold as it will suck in even the most conservative of funds as Gold takes out levels like $1200, $1300 as if they were fig leaves.
Gold The Greatest Currency Trade of the Millennium Even though gold has been in a correction during these last few months, it is important to step back and see how it has out-performed every other currency since this decade, century, and millennium began. I first recommended gold and gold stocks back in February 2002 because the trend I saw of currencies cheapening themselves against their trading partners. You can call this "competitive devaluation." This had not been seen since the Great Depression, and to me, even back then, was a signal that the world economy was heading into tough times. Since about 2001, whenever any currency rises too much, the local manufacturers or farmers – or anyone who lives by exporting – start to scream about it. Their local governments respond by doing all they can to lower the value of that currency, having it fall in value and thus making exports cheaper, all this in the hope that the domestic economy will become better.
Sparkling period for gold is driven by global fears House prices, shares and cash savings have struggled with recession and low interest rates this year, but one asset has enjoyed a golden period. Earlier this month the price of gold hit an all-time high of $1,226.56 (£766) an ounce, up 41% this year and more than four times higher than a decade ago - a sparkling return against most other lacklustre investments.
Gold untraded Dec 25 but platinum and silver inch up With some eastern markets open on Dec 25, silver and platinum prices edged up in light trading, but gold was untraded that day. Gold was untraded on Friday with many players away for the Christmas holidays, while silver and platinum prices inched up. Spot gold was untraded at 0040 GMT. The New York notional close was $1,104.45 per ounce. Spot gold fell to a 7-week low of $1,074.10 an ounce on Tuesday. It has since recovered by about 3 percent. Platinum and palladium prices surged on Thursday after a British firm moved a step closer to launching the first U.S. exchange-traded funds on the precious metals used for cleaning auto emissions.
ETFs, physical investments drive gold market Six geese a laying. Five, Gooollden Riiinnngs." Every year, PNC bank calculates the cost of buying the 12 Days of Christmas. This year's cost: $87,403. Unsurprisingly, labor is the biggest component of that, what with all the pipers piping, lords a-leaping, ladies dancing and maids a-milking. Obscure livestock is also pricey (who knew swans a-swimming cost $750 a pop?). But the only commodity component of that $87,403 - the golden rings - is responsible for the biggest percentage gain in the Christmas index, with PNC estimating manufactured gold to have risen 43 percent since this time last year.
Beijingers in gold rush at year end Gold jewelry sales jumped more than 30 percent over the weekend in Beijing, as bargain shoppers swarmed the city's major jewelry stores on year-end promotions. In a collective sales campaign after international gold prices fell, stores including Caibai, Gongmei and China Gold reduced the pure gold's price by as much as 9 yuan per gram, with more Christmas-themed jewelry designs for shoppers to choose from.
Gold brings a smile to the world's central bankers here is little to beat the lure of gold, as many recipients of a lavish Christmas gift will confirm, but it is not only seasonal impetus that has put a new shine on the precious metal — for the first time in 21 years the world’s central banks have been net buyers. World Gold Council (WGC) data reveals that amid growing concern over the weakness of the dollar, about $28 billion of bullion was bought by central banks this year, based on an average price of $978 an ounce. The biggest buyers have been the emerging economies of China, Russia and India, but smaller countries such as the Philippines, Kazakhstan, Sri Lanka and Mexico have also been shifting their reserves into gold.
Central banks keen to stock up on gold The European Central Bank (ECB) decision to downsize its annual gold sale in 2009 to 155 tonnes is expected to further boost yellow metal prices in 2010. The ECB has sold 400- 500 tonnes annually the last 10 years. Of late, there is a tendency among central banks of many countries to hold a major portion of their reserves in gold. The emergence of new net buyers is expected to add strength to the bullish trend in the metal. China had acquired 450 tonnes, India 200 tonnes and Russia 120 tonnes from the International Monetary Fund this year.
Gold, dollar and euro: A love triangle into 2010 This post is a guest contribution by Dian Chu*, market analyst, trader and author of the Economic Forecasts and Opinions blog. Gold hit a 7-week low on Dec. 22 from recent optimistic data of the U.S. economy. For example, U.S. existing housing sales jumped more than expected, and GDP grew at a 2.2% rate in the third quarter, the fastest pace in two years, amid a larger-than-expected downward revision. The upbeat news lifted the dollar and pushed yellow metal prices to below the $1,100 benchmark.
2009 witnessed change in sentiment towards gold Gold: Prices continued to stay under pressure last week because of a firming dollar. The market dropped below the psychological $1,100 an ounce even as less-committed investor exited. However, speculative longs are still holding considerably large positions on the bourses. While investor interest remains the key to the gold market, in the short-term, currency will play a crucial role. A firming dollar is sure to pressure prices down.
Bullion & Business Weekend Report - Dec. 26 Gold and silver prices moved narrowly in both New York and London during the holiday-shortened week. Platinum, however, soared following news that the SEC approved a proposed rule change to list and trade ETF Securities Platinum and Palladium Trusts. In other markets, crude oil pushed above $78 a barrel for the first time in three weeks while US stocks ended at new 2009 highs. Major European indexes enjoyed weekly gains as well.
Silver Showing Positive Bullish Developments Last week's update was too bearish - especially as there have been a number of positive developments this week not only in both silver and gold but also with respect to major elements having an important bearing on Precious Metal prices. In the Gold Market update we have seen how gold appears to have bottomed and to now be in position to advance again. The action in silver last week was similar, as we can see on its 6-month chart, with it recovering late in the week following an exact contact with the lower boundary of a channel that began to form last September. At the time of this contact a V bottom formed, as with gold, a sign that it had hit a low. Following this positive action and the improvement late in the week it is now in position to advance back towards the top of this channel, a move which would result in appreciable gains from the current level. Various indicators such as the MACD are oversold, providing the leeway for such an advance.
Does dollar’s rally impact the bull market for gold It as become clear that the media and many institutional analysts are going to keep talking the Dollar up despite the lack of fundamental reasons, writes Julian Phillips of the Gold Forecaster. We feel that you will benefit most from a look at what lies ahead for the Dollar and its fundamentals and what could take it higher, if it does rise.
Welcome to the gold party craze: A new day pawning Sometimes when Amber Watson-Tardiff comes across a single cuff-link or a massive tangle of chains in her jewelry box, it occurs to her that it might be time for a gold party. Like many people who are looking for an extra way to make some cash, Watson-Tardiff is skipping the pawn shop and opting instead to sip champagne cocktails with her friends while an appraiser announces just how much her unwanted bling will bring her in unexpected riches. With the price of gold hovering around $1,100 an ounce, the take can be pretty lucrative.
2010 likely to be more testing for hedge funds Hedge funds making big bets on currencies, commodities and equities are favoured by fund selectors in what is likely to be a more testing 2010 after a bumper year for hedge fund returns, it is claimed. While 2009 was characterised by buying riskier assets rebounding from last year's depressed prices, managers believe that 2010 will not see such large price rises. Many fund managers think countries will emerge from the global downturn at different speeds. The UK, for example, was still in recession in the third quarter while some trading partners had begun growing in the second quarter meaning loose monetary policies may be tightened at different times.
Do we need a new reserve currency? A new global currency should replace the US dollar as the international reserve currency, as the long-term deterioration of America's economy and the greenback is fuelling a "currency-regime crisis", says Martin Wolf, associate editor and chief economics commentator of the Financial Times. Wolf, who has honorary doctorates from three universities, bases his argument in part on the Triffin dilemma, an economic paradox named after economist Robert Triffin. The paradox shows that the US dollar's role as a global reserve currency leads to a conflict between US national monetary policy and global monetary policy. It also points to fundamental imbalances in the balance of payments, particularly in the US current account.
Gulf nations may opt first for dollar in currency union Four Gulf nations entering the Middle East's first monetary union pact are expected to peg their single currency to the US dollar in the first phase of the historic project but might opt for a basket later, according to analysts. Saudi Arabia, Kuwait, Qatar and Bahrain, members of the six-nation Gulf Co-operation Council (GCC), have kept the world guessing on what type of currency they would adopt for their monetary union, which was ratified by their heads of state at their annual summit in Kuwait in mid-December.
What Will the New World Reserve Currency Regime Be? The deterioration of the dollar reserve currency regime is obvious. As we have forecast, the world will look to some variation of the IMF's Special Drawing Rights as an eventual replacement for the US dollar. Therefore, the recomposition of the SDR next year will become a lightning rod for the global stresses created by an increasingly unstable and impractical system of global trade.
Concerns grow over sovereign debt risk Sovereign debt risk is emerging as an important concern for senior bankers, risk consultants and auditors following financial woes in Dubai and Greece. After two years of worrying about mortgage and corporate risk, attention is now shifting to managing the risk of country defaults and bankruptcies of heavily indebted regional governments and city administrations, say bankers. Bankers at some large institutions are discussing whether they need to make provisions for sovereign risks in the same way they now set aside reserves to cover losses from corporate or emerging market risks.
Wen dismisses currency pressure Wen Jiabao, China’s premier, has said Beijing would not give in to foreign demands for its currency to strengthen, taking an increasingly defiant tone amid mounting international pressure. In an interview published by the Xinhua news agency on Sunday, Mr Wen said some of the demands for China to let its currency appreciate were an effort to contain the country’s development. “We will not yield to any pressure of any form forcing us to appreciate. As I have told my foreign friends, on one hand, you are asking for the renminbi to appreciate, and on the other hand, you are taking all kinds of protectionist measures,” he said.
A Way to Share in a Nation’s Growth It's Time For Governments To Issue Stock Instead Of Just Borrowing CORPORATIONS raise money by issuing both debt and equity, the latter giving investors an implicit share in future profits. Governments should do something like this, too, and not just rely on debt. Borrowing a concept from corporate finance, governments could sell a new type of security that commits them to paying shares in national “profit,” as measured by gross domestic product.
US treasury bonds a Ponzi scheme waiting to crash It is really no secret that US treasuries have become the biggest Ponzi scheme in global financial history. In a Ponzi scheme new buyers’ money is used to pay out redemptions until the new buyers dry up and the whole thing crashes. For US treasuries the buyers are now waning. The most recent evidence points to the Fed as the main buyer of these bonds last year, with the Chinese second in line and then the banks.
Treasury Yield Curve Steepens to Record on Debt Demand Concern Treasuries fell, with the difference in yields between 2- and 10-year notes widening to a record amount, as investors bet the U.S. recovery will fuel inflation and reduce demand at the government’s debt auctions. The 10-year note’s yield climbed to the highest level in four months as reports showed increases in sales of existing homes and orders for durable goods. The U.S. will sell a record- tying $118 billion of 2-, 5- and 7-year notes next week.
What Iceberg? Just Glide to the Next Boardroom YOU might think that board members overseeing businesses that cratered in the credit crisis would be disqualified from serving as directors at other public companies. You would, however, be wrong. Directors who were supposedly minding the store as disaster struck at companies like Countrywide Financial, Washington Mutual or Fannie Mae have not all been banished from other boardrooms. In many cases, directors just seem to skate away from company woes that occurred on their watch.
The Yield Curve Is Signaling Bigger Growth What’s a yield curve, and why is it so important? Well, the curve itself measures Treasury interest rates, by maturity, from 91-day T-bills all the way out to 30-year bonds. It’s the difference between the long rates and the short rates that tells a key story about the future of the economy. When the curve is wide and upward sloping, as it is today, it tells us that the economic future is good. When the curve is upside down, or inverted, with short rates above long rates, it tells us that something is amiss — such as a credit crunch and a recession.
U.S. rate hikes in 2010? Plausible, but not a given Wall Street's raging bulls may be getting ahead of themselves. From the first inklings of U.S. economic growth after the deepest recession since the 1930s, some investors have extrapolated a robust expansion that will force the U.S. Federal Reserve to raise interest rates in the second half of next year. Their reasoning, based on the notion that companies overreacted to last year's epic financial meltdown by cutting staff and production too sharply, has some merit.
Senate OKs rise in debt limit to $12.4 trillion The Senate voted Thursday to raise the ceiling on the government debt to $12.4 trillion, a massive increase over the current limit and a political problem that President Obama has promised to address next year.
Schumer Urges Wall Street Banks to ‘Get That Money Out There’ New York Senator Charles Schumer warned Wall Street firms to “live up to your responsibilities” and increase lending, particularly to small businesses, while showing restraint on executives’ bonuses. “Get that money out there,” Schumer said in an interview Dec. 23 on Bloomberg Television’s “Political Capital with Al Hunt,” airing this weekend. Banks should make sure the bonuses aren’t “excessive” and are based on merit, Schumer said. The position of firms such as Goldman Sachs Group Inc. that they didn’t need the government’s help to survive “is just false,” he said.
Here's The Secret Reason We Eliminated The Bailout Caps On Fannie And Freddie On Christmas Eve, when the news was assured of getting no coverage whatsoever, The White House announced that it had eliminated the maximum bailout cap for Fannie Mae (FNM) and Freddie (FRE). As some observers have pointed out, all the move really did was formalize what everyone has figured for decades, that the two zombie GSEs were truly organs of the federal government, and that their debts would be backed up ad infinitum. So, why the move, and why then?
U.S. Move to Cover Fannie, Freddie Losses Stirs Controversy The Obama administration's decision to cover an unlimited amount of losses at the mortgage-finance giants Fannie Mae and Freddie Mac over the next three years stirred controversy over the holiday. The Treasury announced Thursday it was removing the caps that limited the amount of available capital to the companies to $200 billion each. Unlimited access to bailout funds through 2012 was "necessary for preserving the continued strength and stability of the mortgage market," the Treasury said. Fannie and Freddie purchase or guarantee most U.S. home mortgages and have run up huge losses stemming from the worst wave of defaults since the 1930s.
Commercial Real Estate Holders Decide to Walk Away: The Continuing Double Standard from the Banking Industry. Debt Ceiling Raised to $12.4 Trillion Making Room for more Bailouts. There will be many new financial stories in 2010 but one that is certainly to garner much attention is the implosion of the commercial real estate market. A $3.5 trillion market that has taken it on the chin alongside the residential real estate market. The commercial real estate debacle usually follows a similar pattern. Residential real estate pulls back followed by commercial real estate. But in this massive decade long real estate bubble commercial real estate debt ballooned into uncharted territory. The bust is going to be deep and has no parallel in history just like the housing bubble bursting. Yet the U.S. Treasury and Federal Reserve have already had backroom talks about coming out with a “Plan C” to bailout this segment of the American economy.
Bailed Out Freddie Mac Says Mortgages Will Be More Expensive Showing once again that the path to living in a greener and more energy efficient world is fraught with difficult choices and unexpected consequences, the New York Times tells the story of rare-earth mining in China. Many green technologies rely on one or more of the seventeen rare-earth elements that come almost entirely from China. The mines are dangerous and wreak environmental havoc on the surrounding area, even as they yield “miracle ingredients” without which some green products couldn’t exist. What’s worse, the Chinese mining industry is controlled by gangs, the paper reports. However, it was a Chinese government ministry that threatened this year to stop all export of raw materials and require Western countries to buy finished products. That plan was quickly shouted down, but by no means are the issues around rare-earth mining resolved. One executive whose company buys rare-earths said about the mining practices, “we can’t [save the world] and leave a product that is glowing in the dark somewhere else, killing people.”
Homeownership in U.S. May Decrease, New York Fed Study Finds The rate of home ownership in the U.S. may fall in coming years as households rebuild equity wiped out by the worst slump since the Great Depression, according to a study by economists at the Federal Reserve Bank of New York. “The official home ownership rate will likely experience significant downward pressure in the coming years,” Andrew Haughwout, Richard Peach and Joseph Tracy wrote in a paper posted on the bank’s Web site. Owners whose mortgages are larger than the properties are worth “very likely will convert officially to renters,” assuming prices don’t climb in the next several years, they said.
Retailers Shift Focus to Post-Holiday Deals to Lure Buyers Post-Christmas Discounts With Sales Forecast to Decline 1% U.S. retailers extended discounts on computers, toys and clothes beyond Christmas to lure consumers who held out for lower prices and have gift cards to redeem. Toys “R” Us Inc. shoppers who buy a Nintendo Wii video game can buy a second game for half price. Target Corp. offered a set of six wine glasses for $8.98, down from $17.99 and reduced the price of a cotton-blend argyle women’s sweater to $17.50 from $25.
Gift Cards Are Retailers' Last Chance for a Happy Holiday The books are closed on the holiday shopping season, and researchers from ComScore to the National Retail Federation are adding up the final numbers, which will probably start to trickle out this week. Based on the figures through last weekend, sales in bricks-and-mortar stores might be up 1% from last year -- or down 1%. E-commerce sales, on the other hand, appear to have been higher by as much as 4%. But the online numbers may not be much comfort to the big store chains because cyber sales account for only a small fraction of their total revenue.
Frequently Asked Questions about ObamaCare Moon bats who voted for Barack Obama are obviously delighted that the U.S. Senate passed ObamaCare on the morn of Christmas Eve. However, many are confused and do not realize that the House and Senate must reconcile any differences before a final bill can be sent to the president. Others are not misinformed as to the effective dates and coverage terms. The following list of Frequently Asked Questions (FAQs) is provided as a public service to help the DNC provide answers to anxious voters…
Pelosi Asked Where Constitution Grants Congress Authority to Mandate Purchase of Health Insurance
House backers of public insurance option may yield Some House supporters of public health insurance plan seem resigned to giving it up in talks Two House Democrats who favor a government insurance plan, a central element of health care legislation passed in their chamber, acknowledged Sunday it might have to be sacrificed as negotiators work out a final agreement with the Senate. Rep. James Clyburn of South Carolina, the No. 3 Democrat in the House and one who had appealed to President Barack Obama not to yield on the public plan, set out conditions for yielding himself. Asked during rounds on the Sunday news shows whether he could vote for a final bill that does not embrace a public plan, Clyburn said: "Yes, sir, I can."
It's Not Socialism. It's Communism. If you felt a frisson of fear on news that the Senate had passed Obamacare the day before Christmas, then you now know what it was and is like to live in a dictatorship. The voice of the People was ignored in a demonstration of raw political power. There was a time when Americans took Communism seriously. It challenged us in the form of the Soviet Union and we witnessed its takeover of China. In Europe, uprisings against Soviet rule were crushed in East Germany in 1953, Hungary in 1956, Czechoslovakia in 1968, and Poland in the 1980s gave proof that only oppression can sustain this failed economic and political system. President Reagan gave voice to it when he called the Soviet Union an “evil empire.”
Everyone's Defaulting, Why Don't You? Strategic defaults—the phenomenon of people who could continue to make payments on the mortgages on their homes deciding to walk away from their obligations—are rising. According to the Wall Street Journal, strategic defaults are likely to exceed 1 million in 2009. This is making some worry about the very future of capitalism. Georgetown University business ethics professor George Brenkert told the Journal that borrowers who can afford to stay current are morally required to do so, and that were Americans to conclude they could just walk away from obligations, it would be disastrous. Mortgage Bankers Association CEO John Courson wondered about "the message they will send to their family and their kids and their friends?" Blogger Megan McArdle expressed disdain for people who chose to indulge themselves on consumer goods and services while not keeping current with their mortgages.
Obama urges review of terror watch-list President Barack Obama on Sunday ordered an urgent review of how US authorities use terrorist watch-lists to foil attacks on US targets after a Nigerian tried to destroy a transatlantic passenger aircraft with an explosive device he smuggled on board. Umar Farouk Abdulmutallab, 23, undergoing treatment for burns sustained in Friday’s abortive attempt on a flight from Amsterdam to Detroit, figured on a US database of people with suspected terrorist connections but had not been added to a 4,000-name no-fly list. He has been charged with trying to blow up the airliner as it was coming in to land.
Spy chiefs struggle to counter threat The revelation that a 23-year-old Nigerian accused of trying to blow up an aircraft in the US was placed on a watchlist and yet still was able to board a flight to the US is a stark reminder of the challenge facing intelligence agencies in combating terrorism. In recent years, intelligence chiefs in the US and Britain had appeared increasingly confident they had a better grip on the Islamist terrorist threat – and a far better oversight than they did a decade ago of potential jihadist attackers. Yet the case of Umar Farouk Abdulmutallab is a reminder of how easily potential terrorists can still slip under the radar.
Northwest Bomb Plot Planned by al Qaeda in Yemen Officials Say Bomb Materials Sewn Into Suspect's Underwear by Top Terror Bomb Maker The plot to blow up an American passenger jet over Detroit was organized and launched by al Qaeda leaders in Yemen who apparently sewed bomb materials into the suspect's underwear before sending him on his mission, federal authorities tell ABC News. Investigators say the suspect had more than 80 grams of PETN, a compound related to nitro-glycerin used by the military. The so-called shoe bomber, Richard Reid, had only about 50 grams kin his failed attempt in 2001 to blow up a U.S.-bound jet. Yesterday's bomb failed because the detonator may have been too small or was not in "proper contact" with the explosive material, investigators told ABC News.
Wealthy, quiet, unassuming: the Christmas Day bomb suspect The inside story of the privileged student who embraced al-Qa'ida and tried to blow a transatlantic jet out of the sky - and the lessons for us all With his wealth, privilege and education at one of Britain's leading universities, Abdul Farouk Abdulmutallab had the world at his feet – able to choose from a range of futures in which to make his mark on the world. Instead, the son of one of Nigeria's most important figures opted to make his impact in a very different way – by detonating 80g of explosives sewn into his underpants, and trying to destroy a passenger jet as it came in to land at Detroit Airport on Christmas Day.
25 Brits in jet bomb plots COPS fear that 25 British-born Muslims are plotting to bomb Western airliners. The fanatics, in five groups, are now training at secret terror camps in Yemen. It was there London-educated Umar Abdulmutallab, 23, prepared for his Christmas Day bid to blow up a US jet. The British extremists in Yemen are in their early 20s and from Bradford, Luton and Leytonstone, East London. They are due to return to the UK early in 2010 and will then await internet instructions from al-Qaeda on when to strike. A Scotland Yard source said: "The great fear is Abdulmutallab is the first of many ready to attack planes and kill tens of thousands.
BREAKING NEWS! Iran WAR LOOMING!
Iraqi and Iranian forces stand off in oil well row Iraqi and Iranian forces are dug in on either side of a disputed inactive oil well in the sensitive border area, with Iraqis vowing to fight if necessary to fend off another occupation of the well by Iranian soldiers. Iraqi troops say they will defend the well, where Iranian troops raised a flag for several days this month. It is unclear how many troops are involved in the stand-off, but as many as 30 lightly armed Iraqi troops usually occupy border outposts in sensitive areas, and up to 10 in other areas. Some 11 Iranian soldiers are stationed near the disputed well.
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Fri 12.25.2009
Merry Christmas 2009!
Straight No Chaser - Carol of the Bells
All I Want For Christmas Is You - Mariah Carey
White Christmas by Bing Crosby
Christmas Light Show - Amazing Grace Techno
Leann Rimes - Amazing Grace
Donkeys escape from live nativity scene in Colo. A living nativity scene in near the Colorado ski resort of Vail almost had to go without two crucial actors when two donkeys escaped. The nativity scene is an annual tradition for Eagle River Presbyterian Church in the Vail Valley. Pastor Rob Wilson says two borrowed donkeys were being held in a fenced-in pen for the event Wednesday night, but the animals pushed their way through it. A church member who stopped by the church Wednesday morning noticed the donkeys were gone. He and a sheriff's deputy followed footprints in the snow and eventually caught up with them.
Storm turns holiday travel dangerous in Midwest A blustery storm spread snow and ice across the heartland Thursday as Americans rushed to get home for the holidays, grounding flights, stranding drivers on white-knuckle highways and forcing churches to cancel Christmas Eve services. "I don't think God wants anyone to get killed or break a hip or break a knee or something," said the Rev. Joseph Mirowski of the Greek Orthodox Church of the Transfiguration in Mason City, Iowa, which was expecting up to a foot of snow and sleet.
Retailers Slug Out Season With More Discounts, Hours U.S. retailers used extra promotions and extended hours to draw procrastinators and shoppers delayed by the East Coast snowstorm in the final stretch before Christmas. Target Corp. extended its hours to midnight Dec. 21 through yesterday. Borders Group Inc., Wal-Mart Stores Inc. and Toys “R” Us Inc. also kept stores open longer. Best Buy Co. offered some DVDs for half off and Jos. A. Bank Clothiers Inc., a men’s clothing chain, deepened discounts to at least 50 percent.
Shrinking Credit Threatens Almost $9 Billion in [Christmas] Sales Target Corp. and U.S. retailers may lose almost $9 billion in holiday sales as banks rein in lending to cash-strapped consumers before a new credit-card law takes effect. Sales in November and December may fall 1.2 percent to $436.7 billion from the same period in 2008, said Britt Beemer, chairman of consumer polling firm America’s Research Group. If lenders weren’t cutting customer spending limits and rejecting more credit-card applicants, sales would gain about 0.8 percent to $445.5 billion, he said in a Dec. 21 interview.
LAPD to hand out 10,000 pairs of shoes The counterfeits were confiscated by police. They will go to missions and homeless shelters for distribution starting Monday. In the season of giving, authorities have come up with a way to help the homeless through items they have confiscated: Hand out about 10,000 pairs of counterfeit athletic shoes. The shoes, which include knockoff Nike and Adidas sneakers minus the labels, were seized for trademark infringement by the Los Angeles Police Department's anti-piracy unit.
No holiday joy for beauty salons Hairstylists and manicurists are starved for business as customers forgo traditional pampering and do it themselves. During the holidays, Katie McCranie usually treats herself to a trip to the nail salon and an appointment with her hairstylist. This Christmas season, with a tight budget and a temporary job, the 28-year-old from Santa Monica said she can't afford to splurge on those little luxuries. "I do everything myself -- I've been doing my own hair, painting my own toenails," she said. Instead of getting a leg wax, "I just went back to the razor." For many women, primping and pampering are as important to the holidays as buying gifts and decorating the Christmas tree. But with continued economic uncertainty, penny-pinching is taking the place of personal beautification this holiday season.
Financial Markets and Economic Forecasts 2010, Recovery or More Crisis?Experts offer differing views, with some predicting 2010 to be a difficult year and others saying it will see recovery continuing THE world escaped from a financial meltdown and a new Great Depression more easily than many dared hope in 2009. Asia in particular bounced back faster than expected, thanks largely to huge fiscal and monetary stimulus in China. The situation in the world's most advanced economies was also stabilised by massive government spending, financed largely by central banks printing money. Will 2010 be a year of further recovery, fuelled by reviving private demand, or will it be the 'year of reckoning' when double-dip recession and deflation appear, and when debts shifted from the private to the public purse have to be paid? The Business Times assembled a panel of eminent and seasoned experts to review economic and investment prospects.
Is war the answer to a depression?
Don't be surprised if gold trades at $1500 in 2010' Looking ahead to 2010, a number of factors will influence gold prices to go bullish and push it to $1500 per ounce according to Jeffrey Nichols, Senior Economic Advisor to Rosland Capital "Gold has enjoyed a long and enviable climb, rising some 380 percent from a cyclical low near $255 an ounce in April 2001 to an all-time high just over $1,225 early this month. Looking ahead to 2010, don't be surprised to see gold trade at $1,500 or higher sometime during the New Year. And that's not all: I've been telling clients that the yellow metal's price will continue its long-term upswing for at least a few more years, very likely reaching $2,000 an ounce and possibly higher.
Nichols still bullish on gold - $1500 in 2010 and $2000-$3000 longer term Gold has enjoyed a long and enviable climb, rising some 380 percent from a cyclical low near $255 an ounce in April 2001 to an all-time high just over $1,225 early this month. Nevertheless, the bull market in gold has a long way to go - both in magnitude and direction. Looking ahead to 2010, don't be surprised to see gold trade at $1,500 or higher sometime during the New Year. And that's not all: I've been telling clients that the yellow metal's price will continue its long-term upswing for at least a few more years, very likely reaching $2,000 an ounce . . . and possibly hitting $3,000 or more before the gold price cycle begins its next long-term cyclical "bear" phase.
Gold Finishes Above $1,100 As Dollar Slides Gold finished higher in an abbreviated session Thursday as the dollar continued a pullback versus the euro. The metal rose for a second straight session after hitting a seven-week high earlier in the week. December gold finished at $1,104.10 an ounce, up $10.80 on the session. Prices hit as high as $1,105.30 and as low as $1,092.00. Floor trading is closed tomorrow for Christmas. For the week, gold lost $5.30 an ounce. The metal had hit as low as $1,075 on Wednesday.
Gold Prices Fight Back After Losing Ground Gold is seeing more strength Thursday on the back of a weaker U.S. dollar. The precious metal started reclaiming lost ground Wednesday after a multi-day losing streak. Prices settled Wednesday at $1,094 an ounce. Mixed economic data supported signs of an economic recovery, prompting an uptick in equities and commodities and a slight decline in safe haven assets like the dollar. The U.S. dollar index was slipping .25% to $77.73 while gold was rising $7.10 to $1,101.10 an ounce at the Comex division of the New York Mercantile Exchange.
Gold Rises Most in a Week as Dollar Drop Spurs Demand for Metal Gold rose the most in a week as a drop in the dollar spurred demand for precious metals as alternative assets. Silver, platinum and palladium also gained. The dollar fell to the lowest level this week against a basket of six major currencies, losing as much as 0.5 percent. Bullion, which some traders buy as a hedge against inflation, typically rises when the dollar falls. The metal has gained 25 percent this year, touching a record $1,227.50 an ounce earlier this month, as the dollar slipped more than 4 percent.
Gold rises 1.5 percent as US dollar falters Dollar dips, easing from three-month highs Gold prices rallied more than 1.5 percent on Thursday to above $1 100 (R8 239) an ounce as the dollar lost ground and on the back of robust investment flows betting on higher bullion prices. Other precious metals took their cue from gold's strength with both palladium and platinum rallying to their highest in about a week at $375 an ounce and $1 4560.50 an ounce respectively.
Selling gold is popular in a struggling economy Nouriel Roubini Selling gold has become much more popular within today’s struggling economy. It is not unusual for the price of gold to rise when the economy is not doing very well. Over the past two years, gold prices have increased nearly 70 percent. Gold is part of the greenest industry that we have and has always been recycled. When it is taken out of the ground, it is never returned, being used over and over again.
Gold Bubble: Jim Rogers lambasts Nouriel Roubini The differences of opinion on gold forecast by Jim Rogers and Nouriel Roubini are turning sharp and deep. Global commodities investor Rogers has once again lambasted Roubini for predicting that gold price is on a bubble that will burst soon. “I am flabbergasted at Roubini’s comment about bubbles because there is not a single market in the world making all-time highs except gold, US Government Bonds, Cocoa, and the Sri Lankan stock market. That’s hardly reason to call for a bubble. So, I am most perplexed about this alleged bubble which is out there,” Rogers, who is now settled in Singapore and an aggressive investor in Chinese agri commodities market, told Wall Street Cheat Sheet.
The gold bubble and gold bugs Gold is afire. The performance of the dollar and excess global liquidity are key to understanding this Gold prices have been rising sharply, breaching the $1,000 barrier and in recent weeks rising towards $1,200 an ounce and above. Today’s “gold bugs” argue that the price could top $2,000. But the recent price surge looks suspiciously like a bubble, with the increase only partly justified by economic fundamentals.Gold prices rise sharply only in two situations: When inflation is high and rising, gold becomes a hedge against inflation; and when there is a risk of a near-depression and investors fear for the security of their bank deposits, gold becomes a safe haven.
US Mint Sales: Gold and Eagles Rise; Fractionals Sell Out If last week’s US Mint coin sales report could be considered lackluster, the most recent figures for this week do nothing but continue that trend. Fortunately, a few entries did show some movement, even if that movement could not be called extraordinary. Gold coins appear to have led the pack with decent demand. Most likely this is due to the $50 price reduction on gold issues that stemmed from the lower gold prices. Sales of the American Buffalo Proofs jumped 524 units over last week to 922, bringing the total number sold to 41,553. Also possibly playing into the increased sales is the fact that the bullion versions of the Buffalos reached a sold-out state from the Mint on December 4th of this year, making the proofs the only Buffalos still available.
Passport Capital's gold experiment Burbank sees contracts broken, prepares to buy physical gold The bars, which were light enough to carry in a backpack, marked the culmination of a $95,000 experiment by Passport Capital, a San Francisco-based hedge fund where Moran is director of business operations and strategy. Passport, headed by John Burbank, wanted to find out how easy it would be to buy physical gold, rather than futures contracts or gold exchange-traded funds. The firm was also interested in testing conspiracy theories about the availability of the precious metal.
Russian Central Bank $1 billion gold purchase confirmed The report on Mineweb of 10 days ago that the Russian Central Bank was buying 30 tonnes of gold, worth around $1 billion at current gold prices, for its reserves (see Russian Central Bank to buy 30 tonnes of gold from Gokhran) has now been confirmed as having taken place by an official from Russia's Finance Ministry. This effective transfer of gold from one government entity to another is yet another example of how countries can handle gold holdings so that they do not necessarily show up in official Central Bank figures. Whether, in this case, this is intentional government fudging of the figures to mislead the markets is uncertain - the amounts are perhaps too small - but it will be remembered that China effectively did the same thing earlier in the year when it announced that it had transferred some 454 tonnes of gold over the past few years, which it already held in one government account, to its Central Bank, the news of which gave a strong stimulus to the gold price at the time.
Weaker dollar drives gold higher for 2nd day Gold prices have inched higher for a second day in a row, boosted by a weaker dollar. Gold for February delivery is settling up $10.80 at $1,104.80 an ounce in quiet, holiday-shortened trading on the New York Mercantile Exchange. The modest gain comes as the dollar dipped against other currencies. Gold, which is considered a hedge against a weak greenback, tends to rise when the dollar falls.
Weakness in Dollar Could Help Trigger Sell-off Despite the higher equity markets overnight, the lack of upside momentum is making traders leery of a possible short-term profit-taking correction ahead of tomorrow’s holiday. Weakness in the Dollar could help to trigger a sell-off. Treasuries are trading flat to better. March Treasury Bonds and March Treasury Notes are trying to recover after a hard sell-off this week. Selling pressure should resume after the holiday as traders are beginning to price in the possibility of an interest rate hike in 2010. Aggressive buying by Japanese investors helped to drive up yields earlier in the week.
Dollar Falls on Easing Bets; Japan Stocks Dip, Copper Rises The dollar declined, poised to end three weeks of gains on speculation the Federal Reserve will maintain stimulus to secure the U.S. economy’s recovery. Japanese stocks dropped, while copper climbed to a 15-month high. The greenback fell against 10 of its 16 most-traded counterparts before reports next week forecast to show a slide in U.S. business activity and a rebound in initial jobless claims. Makers of electronics and cars led a 0.2 percent drop in Japan’s Nikkei 225 Stock Average on concern recent gains made shares expensive relative to earnings. Copper and rubber advanced on optimism that the global economic recovery will boost demand for materials.
Central Banks Avoiding Dollar to Kill 2010 Rally, Barclays Says The U.S. dollar’s gains may end in the middle of 2010 as central banks shy away from adding greenbacks to their reserves and the Federal Reserve raises rates at a slower pace than investors expect, Barclays Plc said. Long-term demand for dollars is set to weaken after the currency’s share of global reserves added in the third quarter slid to less than 30 percent, a decline “unprecedented in a period of U.S. dollar weakness,” Barclays said in a note to clients. The dollar stemmed 11 months of declines versus the 16 most-traded currencies in December, gaining against all but two, after investors increased bets the Fed will remove monetary stimulus next year as the economy recovers.
Faber Says Watch US vs. China Great Powers Game Play During 2010 Dr Faber, in the September issue of the Gloom, Boom & Doom Report you said that the future will be a total disaster with a collapse of our capitalistic system as we know it. Three months later do you still stand by that assessment or did you underestimate the power of the governments to shore up the global economy? Well, I think we had this huge intervention in the world but if you look at the cause of the financial crisis. The cause of the financial crisis was excessive credit growth and essentially the private sector has reacted rationally. After 2008, the private sector has reduced its leverage, in other words, the consumer credit is declining and business credit is also declining but this is being offset by a huge expansion of government credit. So total credit as a percent of the economy in the US is still growing.
Congress raises debt ceiling to $12.4 trillion The Senate voted Thursday to raise the ceiling on the government debt to $12.4 trillion, a massive increase over the current limit and a political problem that President Barack Obama has promised to address next year. The Senate's rare Christmas Eve vote, 60-39, follows House passage last week and raises the debt ceiling by $290 billion. The vote split mainly down party lines, with Democrats voting to raise the limit and Republicans voting against doing so. There was one defection on each side, by senators whose seats will be on the ballot next year: GOP Sen. George Voinovich of Ohio and Democratic Sen. Evan Bayh of Indiana.
Bailout's big mistake: Loans to small banks The last of the big banks have returned their bailout funds, but uncorking the champagne would be premature: taxpayers still have a lot of skin in the game, and getting paid back only gets more difficult from here on out. There are still 663 banks that have received a total of $58.6 billion in loans from the Troubled Asset Relief Program and have yet to pay the Treasury Department back.
Bipartisan Duo Moves Ahead on Finance Bill The top Democrat and Republican working on the Senate bill to overhaul regulation of U.S. financial markets outlined the goals they share, and said they hoped to resolve differences on the measure before lawmakers return in January. Sens. Christopher Dodd (D., Conn.) and Richard Shelby (R., Ala.) issued a joint statement Wednesday saying that discussions in recent weeks between Democrats and Republicans had been "extremely productive."
Banks Bundled Bad Debt, Bet Against It and Won In late October 2007, as the financial markets were starting to come unglued, a Goldman Sachs trader, Jonathan M. Egol, received very good news. At 37, he was named a managing director at the firm. Mr. Egol, a Princeton graduate, had risen to prominence inside the bank by creating mortgage-related securities, named Abacus, that were at first intended to protect Goldman from investment losses if the housing market collapsed. As the market soured, Goldman created even more of these securities, enabling it to pocket huge profits.
A Nightmare before Christmas
U.S. Treasury Ends Cap on Fannie, Freddie Lifeline for 3 Years The U.S. Treasury Department will remove the caps on aid to Fannie Mae and Freddie Mac for the next three years, to allay investor concerns that the companies will exhaust the available government assistance. The two companies, the largest sources of mortgage financing in the U.S., are currently under government conservatorship and have caps of $200 billion each on backstop capital from the Treasury. Under a new agreement announced yesterday, these limits can rise as needed to cover net worth losses through 2012.
Treasury removes cap for Fannie and Freddie aid The government has handed its ATM card to beleaguered mortgage giants Fannie Mae and Freddie Mac. The Treasury Department said Thursday it removed the $400 billion financial cap it will provide to keep the companies from failing. Already, taxpayers have shelled out $111 billion to the pair. Treasury Department officials said the $400 billion limit would be replaced with a flexible formula to ensure the two agencies can stand behind the billions of dollars in mortgage-backed securities they sell to investors.
U.S. Uncaps Support for Fannie, Freddie The U.S. Treasury said it would provide capital as needed to Fannie Mae and Freddie Mac over the next three years, effectively opening its checkbook to the government-controlled companies in a bid to reassure investors in their debt. Treasury also will end its purchases of the companies' mortgage-backed securities and terminate a never-used short-term liquidity facility set up for the firms and the Federal Home Loan Banks. And it moved to allow the companies to shrink their giant portfolios of mortgage securities more slowly, though it said it was still "committed to the principle" of reducing the portfolios.
Fannie Mae, Freddie Mac CEOs could each earn $6 million a year Michael Williams at Fannie and Charles E. Haldeman Jr. at Freddie will each receive a base salary of $900,000 in 2009 and 2010. They could get $5.1 million more if certain targets are met. Reporting from Washington - The chief executives of Fannie Mae and Freddie Mac each could earn as much as $6 million this year and next, despite huge continued losses at the seized mortgage giants and a government bailout tab of more than $100 billion that the Obama administration said could rise even higher. Fannie Mae Chief Executive Michael Williams will earn a base salary of $900,000 in 2009 and 2010, with a deferred base salary of $3.1 million each year to be paid "only if the enterprise meets performance metrics" set by its board and subject to government review, according to filings Thursday with the Securities and Exchange Commission. An additional $2 million is possible annually, identified as "target incentive opportunity." Freddie Mac Chief Executive Charles E. Haldeman Jr. will get the same compensation package.
Is it all just a Ponzi scheme? Sprott Calls The Fed "A Ponzi Scheme" As Half A Trillion In Treasury Purchasers Are Unaccounted For By: Eric Sprott & David Franklin In our May/June Markets at a Glance, "The Solution…is the Problem", we discussed how much debt the US government would need to issue in order to balance the budget for fiscal 2009. We calculated they would need to sell $2.041 trillion in new debt - or almost three times the new debt that was issued in fiscal 2008. As a thought experiment, we separated all the various US Treasury owners and asked our readers whether each group could afford to increase their 2009 treasury purchases by 200%. In the end, we surmised that most groups couldn’t, and prepared our readers for the worst.
Senate Bill: True Health-Care Reform or the End of Capitalism? The Senate passed health-care reform legislation Thursday morning, bringing America "incredibly close to making health insurance reform a reality in this country," as President Obama told reporters. The Senate bill means "for the first time, most Americans would be required to obtain health insurance, either through their employer or via new, government-regulated exchanges," The Washington Post reports. "Those who can't afford insurance plans would receive federal subsidies. And Medicaid would be vastly expanded to reach millions of low-income children and adults."
The Three-Step Plan to Stop Nationalized Health Care Congressional Democrats, after all their faux wrangling, open bribery and bully tactics, are poised to reach agreement on a massive makeover of the American health system. This makeover will bankrupt the insurance companies, raise premiums, and eventually lead to the full nationalization of health care. That's what it is intended to do. By forcing insurance companies to cover pre-existing conditions, the Democrats destroy all profit margin for the insurers, expecting that the healthy insured will pay for the unhealthy insured. To prevent the healthy insured from opting out of the system, the Democrats levy the threat of fines and jail time. And when the insurers go under, as they surely will, the Democrats will be waiting.
Health Care Reform Has Americans Dazed and Confused Most Americans still don't have a clue about health care reform. Months of debate in Congress, endless chest-thumping by pundits and scores of dramatic 30-second ads have done shockingly little to educate Americans about the sweeping legislation that promises to affect all of them for decades to come. Quoting a Pew Research Center analysis of its Dec. 9-13 nationwide poll, McClatchy Newspapers reports that "a large majority of Americans -- 69% -- say they find the issue hard to understand." That's even higher than the response Pew got in late July of 63%. For anyone involved in the debate, that statistic has to be depressing. Then again, this issue is a nightmare to explain to anybody, regardless of their political persuasion.
Senate OK's Health Care Bill in Victory for Obama Senate approves health care bill, clears way for final compromise with House on legislation In an epic struggle settled at dawn, the Democratic-controlled Senate passed health care legislation Thursday, a triumph for President Barack Obama that clears the way for compromise talks with the House on a bill to reduce the ranks of the uninsured and rein in the insurance industry. The vote was 60-39, strictly along party lines, one day after Democrats succeeded in crushing a filibuster by Republicans eager — yet unable — to inflict a year-end political defeat on the White House.
As Health Bill Advances, Few Changes Seen for Millions Now that the Senate has caught up with the House by passing a sweeping health care bill, lawmakers are on the verge of extending coverage to the tens of millions of Americans who have no health insurance. But what about the roughly 160 million workers and their dependents who already have health insurance through an employer? For many people, the result of the long, angry health care debate in Washington may be little more than more of the same. As President Obama once promised, “If you like your health plan, you can keep your health plan.”
Nice Home. Where’s the Rest of It? The author of the Craigslist posting in Las Vegas made no effort to disguise his or her intentions. “Stripping House — Before Foreclosure,” the ad declared, offering potential buyers the cabinets and countertops, the sinks and toilets, the doors, the appliances, the sprinklers. Even the palm and citrus trees in the yard were for sale, with a catch. “You dig,” the author advised. In Nevada and other states hit hard by the housing crisis, stripping fixtures and appliances from homes in foreclosure has become commonplace. Craigslist, the Web site for classified ads, functions as a bazaar where stripped items are sold openly. Often, the stripping is not done by strangers. It is done by the owner, just before the bank forecloses on the mortgage and takes the property back.
There Are Tea Parties and Tea Parties, and Here the Twain Meet, Uneasily Mr. Richardson, Who Knows How to Brew, Visits Ms. Sims, Steeped in Politics There are two tea-party movements in America. One favors low taxes, small government and patriotic feeling. The other favors fine china, orange pekoe and cordial chitchat. The two have coexisted uneasily since Dec. 16, 1773, when antitax demonstrators dumped 342 chests of quite drinkable tea into Boston Harbor. Lately, tea dumpers have touched off a raucous revival. But tea sippers, enjoying a genteel revival of their own, aren't showing the dumpers much sympathy.
Senate Agrees to Vote on Proposal to Halt EPA's CO2 Action The Obama administration may be forced to delay new greenhouse-gas regulations for a year under a Senate Republican proposal that the Democratic leadership has agreed to allow a vote on in early 2010. As part of a deal on a bill to increase the nation's debt limit, Majority Leader Harry Reid (D., Nev.) will allow the GOP to submit a controversial amendment to temporarily suspend new emissions regulation. The agreement was reached late Tuesday. While it's unclear whether the proposal will become law, it could be an early show of how many Democrats support the administration's decision to regulate greenhouse gases under the Clean Air Act.
Israel threatens another large-scale Gaza war Israel has threatened another massive war against the Gaza Strip as the impoverished enclave continues to suffer in the aftermath of the devastating January offensive. Israeli planes have been dropping thousands of leaflets across Gaza, warning Palestinians against cooperating with the resistance fighters based in the coastal sliver. The leaflets also threaten Gazans with a new attack just ahead of the first anniversary of Israel's 22-day onslaught against the Palestinian territory.
Church concerned over Gaza dire situation The head of the Roman Catholic Church in Bethlehem, Patriarch Fouad Twal, has voiced concerns over the worsening humanitarian situation in Gaza. "How can one celebrate while Palestinians are still struggling with a devastating blockade one year after Israel's onslaught on Gaza?" Twal said while addressing the Midnight Mass at Bethlehem's Church of the Nativity on Thursday.
Ahmadinejad: West not brave enough to come clean President Mahmoud Ahmadinejad says some Western countries are using Iran's nuclear program as a pretext to put pressure on the Islamic Republic. In an interview with Britain's Channel 4, Ahmadinejad said that Iran opposes the expansionist policies being pursued by certain Western countries, adding that this was the real reason behind their animosity towards Iran.
[CFR]:Money Out Of Nothing (1 of 3)
[CFR]:The Unseen Guardian Angels (2 of 3)
[CFR]:Media Controlled and Manipulated by Corporate (3 of 3)
Bernanke, Time’s Person of the Year Drives the Debt Crisis Spiral Fed President Ben Bernanke has been named Time magazine’s Person of the Year for 2009. However, in looking back at former People of the Year it becomes crystal clear that this title doesn’t necessarily mean that the honored person has done something good for the world … It only meant that he or she had made a big influence on the course of history during the preceding year. Some have brought us blessings, while others have brought plagues. And this year it surely seems that Time’s journalists think of Bernanke as a blessing for the world. Well, I have to strongly disagree … It Didn’t Work in Zimbabwe, And it Won’t Work in the U.S.
Obamas Healthcare Reform Spells Disaster for Americans (Part 1) First, I want to point out that this article should by no means encourage support for the Republican Party. If you are not already aware, both parties deliver essentially the same results when it comes to issues that matter most to the people, such as the case with free trade and healthcare, while fooling you to think they represent opposing positions. They are able to carry out this deceit with the help of the media monopoly, which uses censorship, lies, misinformation, scare tactics, brainwashing and other methods to deceive the public. Most Americans have been fooled into thinking one party has the solutions to the nation’s problems, when the facts paint a much different picture. You need to understand that both parties are the same. As history shows, you get the same result regardless who resides over the White House and Congress.
Fiat currencies out, gold & silver the new currencies In the currency game, only one player has dominated throughout the course of history: precious metals. Over time, fiat currencies lose their worth, as governments inflate the paper through printing and confidence is lost with each recession. This phenomenon was proven in the United States with the Continental currency, which was rapidly inflated to pay for the revolutionary war. Thereafter, the inflated Continental dollar was replaced with hard metals, which retained and actually grew in value from 1774 to the creation of the Federal Reserve Bank in 1913.
Jim Rogers Bloomberg December 2009 (1) (NWO SERIES/ ECONOMIC COLLAPSE)
Gold rises on stalled dollar rally NEW YORK: Gold prices climbed the most in a week as the dollar sank for the first time in seven days, boosting demand for precious metals as a haven. The dollar fell as much as 0.7% against a basket of six major currencies on speculation that December’s rally will be hard to sustain. Before today, the greenback rose 4.5% this month against the currency basket as gold fell 8.1%. “The gold moves are all related to the dollar,” said Lannie Cohen, the president of Capitol Commodity Services Inc. in Indianapolis. “The dollar had been strong for a few weeks now, putting a cap on prices. If this is the end of that rally, then gold will start to move higher again.”
Gold steady around $1,090 in holiday-thinned market TOKYO, Dec 24 (Reuters) - Gold prices were steady near $1,090.00 per ounce on Thursday as trading was subdued with many players out for the Christmas holidays and investors squaring positions before the year-end.
Gold catches fancy of common investors Gold has made a tentative entry into the portfolios of many common investors in 2009. Of course, it was mainly aided by the yellow metal's blinding returns in a short bursts, when all other assets were plumbing depths in the aftermath of global economic crisis. According to investment experts , many investors have realised the precious metal's ability to act a stabilizer in the wake of economic uncertainties and its important role as a perfect diversification tool over a long period of time during the current year.
Gold rises as dollar weakens after home sales data Gold futures traded higher Wednesday, rebounding from their seven-week low as disappointing consumer confidence and new home sales data weighed on the dollar and boosted gold's appeal as a hedge against a weaker currency. Sales of new homes fell 11.3% in November to a seasonally adjusted annual rate of 355,000, the Commerce Department estimated. The consumer sentiment index came in at 72.5 in late December, according to Reuters/University of Michigan. Analysts had expected the index to climb to 74.
Will Gold Bullion Investors Become Enemies of the State? According to Adolf Hitler: "Gold in the hands of the public is an enemy of the state." I wonder what he meant by this? Was Hitler retarded? Did he have a childhood marred by parental beatings with Gold plated items? Why would he say such a thing? Here's another Hitler quote on Gold: "Gold is not necessary. I have no interest in [G]old. We will build a solid state, without an ounce of [G]old behind it. Anyone who sells above the set prices, let him be marched off to a concentration camp. That's the bastion of money."
Gold: Best Return for the Decade Unless something really drastic happens in the light trading left in the year, this decade belonged to commodities and especially, gold. Here’s a chart showing how much you would have if you invested $100 in each major asset class since 2000: Knowing about the 18 year cycle between commodities and equities, this isn’t surprising. In fact, thanks to this long term historical pattern, we can look forward to almost another decade of the same type of outperformance.
Gold prices to touch $5000: US Gold Corp Gold Prices recovered from a new 7-week low in Asian and London dealing on Wednesday, rising above $1080 an ounce as world stock markets extended their 3-day gains. "Trading is uneventful with Tokyo out on holiday," said one dealer. "Investor and physical interest in the Far East seems to be slowing down ahead of the year end," says another. Crude oil crept back above $74.50 per barrel, meantime, more than twice the price of this time last year.
Gold Bouncing Off Support Levels as Markets Hold Steady The chart above (click to enlarge) shows the pullback in gold prices, which are now nearing support levels. The red line I have drawn represents what had been former resistance levels around $1075. That former resistance is now acting as support, and gold is attempting to bounce from these levels. I trimmed half of our gold etf positions at higher levels, but yesterday I added back a little to play a potential bounce. I don't plan to add back all of our exposure to gold until I see it hold support. Often times there is an initial bounce, and then a pullback to retest said support levels. If this occurs, the second pullback would represent a better entry point. We shall see.
Gold has become part of the global asset bubble . . . . When we chatted in August, you were looking at a gold price in the $900 neighborhood, indicating that fear of another financial disaster was driving gold prices. Since then, gold broke through $1,200 and has now corrected down to about $1,120. Is fear still the driving factor or has the dynamic changed?
Brent Cook: I was probably wrong in my assessment at the time. I didn't take into account the amount of liquidity—money being pumped into the system. I think what is driving gold now and drove it up through $1,200 is greed much more than fear. In my view, gold has become part of the global asset bubble—which includes foreign real estate, stock markets and base metals. So it's actually greed that's been driving gold, at least over the past few months.
Can China beat US in gold reserves in 10 years? China has set the most ambitious task on gold reserves and gold mining: take the country’s gold holdings from the current 1054 tonnes to a massive 10,000 tonnes in the next 10 years. Is this grand task a realistic plan or a golden dream? Chinese officials say the dragon country wants to overtake the United States in gold reserves. America is the world leader in gold reserves. America owns 8133 tonnes of gold reserves that accounts for 76.5% of its foreign exchange reserves. Naturally, the Chinese plan is to ensure that bulk of its foreign exchange reserves--currently held in the forms of US dollar and bonds--is turned into gold reserves.
Will the U.S. Dollar Rally End the Gold and Silver Bull Market? It has become clear to us that the media and so many institutional analysts are going to keep talking the $ up despite the lack of fundamental reasons. We feel that you will benefit most from a look at what lies ahead for the $ and its fundamentals and what could take it higher, if it does rise. A Rally is due? The main reason a rally in the $ is being promoted is because it is due for a rally. The same is being touted for the Pound Sterling. It is certainly true that a price never moves in a straight line. It is also true that investors, buyers and sellers must see trade around all levels to ensure they are balanced and accept price levels as convincing. When the market sees a price 'spike' you can be sure that sellers will turn up to bring it down. The only time it stays there is when buyers and sellers feel that, that price is justified by them both.
Jim Rogers Bloomberg December 2009 (2) (NWO SERIES/ ECONOMIC COLLAPSE/ UK's Debt Crisis)
Gold steadies as lower prices attract buyers Physical buying re-emerges in Europe as prices subside Gold prices steadied in Europe on Wednesday as the metal's slide to a seven-week low in the previous session prompted buying of physical stocks of the precious metal. A persistently firmer tone to the dollar, which hit its highest level since early September versus the euro on Tuesday, is limiting further gains, however.
Is Gold Going Higher or Popping Now? Part2 Yesterday, we analyzed the current bull market in Gold from a historical context. Right off the bat, we ran into some conflicting issues: from a timing perspective, Gold’s recent run is a little long of tooth, however, from a gains perspective, Gold still looks to have plenty of room to run (during the last Gold bull market, it rallied 750% during its second leg up).
How hyperinflation progresses and how to profit With the current US deficit soaring above $12 trillion, the conditions are ripe for inflation. However, is hyperinflation just around the corner?
Step 1: A Collapse
Step 2: Keynesian Solutions
Step 3: Weeding Out Bad Investments
Step 4: Rampant Inflation
Flaherty Says Russia, China May Buy Canada Dollars Canada’s Finance Minister Jim Flaherty said China, with the world’s largest currency reserves of $2.3 trillion, may be poised to buy Canadian dollars as it seeks to shield its reserves against the U.S. dollar’s decline. “It does not surprise me that China and Russia would take greater positions in the Canadian dollar than they have previously,” Flaherty, 59, said during an interview in his office in Ottawa. “I would expect countries looking around the world to invest in market currencies that are reliable.”
Turbulent Year Ahead for Sovereign Debt Issuers As the global economic recovery attains a more solid footing, 2010 will at best see a ?normalization and at worst a severe tightening in government financing conditions. Long-term interest rates may increase more rapidly than expected because of an over-reaction to economic news, which we believe will be mildly positive overall. Moreover, the slow unwinding of quantitative easing will accelerate this credit repricing process.
Top Ten Reasons Why the Yield Curve Will Flatten (Hint: This Is a Different Sort of Recession) As I told Larry Kudlow on CNBC Monday night, the employment recovery will be poorer than the market appears to expect, for reasons I’ve posted on this site during the past two weeks. The yield curve is at record steepness. I think that’s an overreaction. In fact, the steep yield curve in the present environment is NOT a harbinger of recovery — it’s a brake on recovery because it encourages banks to own Treasuries rather than risky assets (see below). Here are my top ten reasons to expect the yield curve to flatten.
Fannie, Freddie Executives Get Big Payday The top regulator for Fannie Mae and Freddie Mac is expected to announce on Thursday millions of dollars in pay packages for top executives at the government-run mortgage-finance titans, people familiar with the matter said. The Federal Housing Finance Agency approved multimillion-dollar pay packages for Fannie Mae Chief Executive Michael Williams and Freddie Mac CEO Charles Haldeman Jr., and those packages are expected to be in a range of $4 million to $6 million, people familiar with the matter said.
Bernanke's Flawed Understanding of Economic Theory In his speech at the Economic Club in Washington, DC on December 7, the Fed chairman, Ben Bernanke, detailed his expectations of the future course of the US economy. . . . . . . . . The actions that policymakers have taken amount to the introduction of extremely loose monetary and fiscal policies. But how does Bernanke know that such policies have averted a global financial meltdown? Neither printing money nor increasing government spending can be a catalyst for economic growth.
Geithner: On the Road to Recovery, but in the Slow Lane Treasury Secretary Timothy Geithner told National Public Radio in an interview Tuesday that he strongly believes we are on the road to recovery, but it won't be fast. He said "we were in a very deep hole . . . It's going to take a long time to repair the damage done to confidence." But he sees people spending more and businesses starting to invest again, all good signs.
Obama Tries to Get Small Banks to Take Bailout This time, no fat cats. President Barack Obama took his plea for more small business lending to community bankers Tuesday, but his prodding was far gentler than it was with high finance CEOs last week. The president offered to help ease regulation that bankers say has restricted lending. He praised the small bankers as pillars of their communities. And he listened sympathetically to their pleas for easier access to capital. "It's fair to say that most of these community banks were not engaged in some of the hugely risky activities that helped to precipitate the financial crisis," Obama said at the conclusion of the meeting with 12 regional bankers and top administration officials.
Study Finds That Of All Factors Determining The "Bailoutability" Of Crappy Banks, Ties To The Federal Reserve Are Most Critical Adam Smith, Charles Darwin and George Washington are not only rolling in their graves, they are dancing the macarena. A new study by the UMich School of Business has found what everyone has known since the crisis began, if not centuries prior: that the biggest, crappiest banks were guaranteed to get more bailout funding the more political ties they had (and more kickbacks they had offered). Is this sufficient to claim that capitalism in its purest sense has been corrupted beyond repair, courtesy of political intervention and constant pandering? David Walker: The U.S. Economy is Unsustainable (originally aired in 2007)
What George Soros Knows About Super Bubbles George Soros, Chairman of Soros Fund Management and author of The Crash of 2008, has been around the financial market block a few times, so I think it pays to heed the regulatory reform recommendations as it relates to the “Super bubble” of 2008. As you probably know, financial bubbles are not a new concept. Beyond the oft-mentioned technology and real estate bubbles of this decade, bubbles such as the “Tulip-mania” of the 1630s serve as a gentle reminder of the everlasting existence of irrational economic behavior. If the Dutch were willing to pay $76,000 for a tulip bulb (inflation-adjusted) almost 400 years ago, then virtually any mania is possible.
Rise and Fall in Dubai, An Austrian Economics Perspective All Is Well - It was January 2008 when I first set foot in Dubai. It was a land full of grandiose, landmark projects. Few cities in the world could match the sheer number of high-rise buildings and skyscrapers being built in the emirate (more than 80 units over 150 meters high are completed or under construction as of this writing). Shopping malls were cropping up everywhere, and the biggest one in the world, Dubai Mall, was then under construction. Retail and the service sector were booming, not just from the significant increase of population in the last several years but also on account of the boost provided by tourism. Needless to say, hotels were flooded with tourists; occupancy rates were over 80%. Lastly, the real-estate and construction sectors were just spectacular. Stories of investors profiting over 20% in one day by buying and selling off-plan properties were commonplace.
Household Financial Burdens Still on a Downtrend Every time I post an update of this chart (click to enlarge) I seem to get a number of incredulous responses. What the chart shows is that households' financial burdens are, on average, lower today than at any time in the past five years. Moreover, they are not any worse today than they were in 2001, and financial burdens have not risen materially for the past three decades.
Disappointing New Home Sales in November May Be a Tax Credit Glitch New homes sales unexpectedly plunged 11.3% in November to a seasonally adjusted annual rate of 355,000, the U.S. Commerce Department announced Wednesday. Demand tapered off as the popular federal first-time home buyer credit was originally set to expire at the end of the month. It was eventually, however, extended by Congress.
New-Home Sales Drop 11.3% As Impact of Stimulus Fades The U.S. economy is showing more signs of recovery, but new data on housing and household income underscored concerns that the economy could lose momentum next year as the impact of government stimulus fades. Sales of newly built homes fell 11.3% in November to a seven-month low, the Commerce Department reported, as the government's tax credit for first-time buyers was originally set to expire. "The housing rebound has so far been largely supported by government programs, raising questions of sustainability as these programs come to an end next year," said BNP Paribas economist Anna Piretti.
Home Sales Plunge 'Unexpectedly' It was "unexpected" since by now all Americans were supposed to be safely ensconced in the home of their dreams with Barack Obama paying their mortgages and utility bills, health care was going to be "free" for all, the world was going to love us again, Club Gitmo was to be shuttered, thereby improving our "image" around the world, Obama would have reduced the sea levels while eliminating mythical global warming and shiny magic unicorns would be delivering toys for all the kids. Or was that Santa Obama? Whatever, you have to laugh at these clowns from AP. Whenever it's depressing economic news somehow it's unexpected. Seriously, what alternate reality are they living in?
The Terrifying Future Facing America During the boom years, no place in America boomed more than Las Vegas. But when the economy collapsed, Vegas fell hard. Laura Ling tours the wreckage of Sin City, from unemployed strippers and half-built, abandoned casino projects, to hospitals turning away cancer patients and ambulances, to one of the few remaining boom industries--evicting people. "Lost Vegas" previews the terrifying future facing America. We are looking at a disaster unprecedented in recent history.
Outsourcing Unemployment:
Oil rises $2 following US inventories Crude oil rose more than $2 a barrel on Wednesday following the latest US weekly inventories data while white sugar prices reached a fresh peak. Nymex February West Texas Intermediate was $2.27 higher at $76.67 a barrel, while ICE February Brent added $1.99 at $75.45 a barrel. US crude stocks dropped 4.9m barrels last week, far above the consensus forecast for a decline of 900,000 barrels. The decline in stocks was due in part to low imports, down 65,000 b/d to just 7.71m b/d last week, after fog affected vessels in the Houston Shipping Channel.
Health care bill: The real money question The health care reform bill on track to pass the Senate on Thursday would do more than any proposal yet to reduce the deficit over time - by an estimated $132 billion over 10 years and by substantially more thereafter. But reducing the deficit is not entirely synonymous with the oft-stated goal of health reform: reducing the growth rate in health care costs and expenditures - often referred to as "bending the cost curve." That growth rate is what drives federal spending on Medicare and other federal health programs.
House Democrats making plans for final health care bill House Democrats are already home for the holidays, but they huddled on a conference call Wednesday afternoon to discuss the next steps in negotiating a final health care bill with the Senate. Speaker Nancy Pelosi restated that the goal is to get a final bill to the president's desk before his State of the Union address in late January or early February, but she admitted the timeline could slip, according to two senior Democratic aides who were on the call.
Sen. Vitter: Healthcare bill is 'Louisiana Sell-out,' not 'Louisiana Purchase' The Senate's healthcare bill might offer Louisiana about $300 million in Gulf Coast recovery money, but that's still not enough to win Republican Sen. David Vitter's (R) support, he told supporters on Wednesday. The entire bill's costs to the state amount to a "Louisiana Sell-out," he said this afternoon -- not a "Louisiana Purchase," as some of Vitter's colleagues have charged when referencing Democratic Sen. Mary Landrieu's (D-La.) decision to vote for the bill despite her initial skepticism.
President: Healthcare bill is more than 'half a loaf' compromise President Barack Obama on Wednesday dismissed criticisms among the left that he has hedged his principles as this year's healthcare debate has toughened. During an interview with PBS's "Newshour," the president said those who now charge he has "compromised" his key healthcare goals are "not paying attention" to the debate itself.
Senate health overhaul clears last procedural step Capitol Hill vote on final passage set for early Thursday morning The White House-backed health-care overhaul got a step closer Wednesday to final Senate passage as lawmakers voted to cut off debate on the $871 billion bill. The move paves the way for a 7 a.m. final vote Thursday morning on the package, which seeks to extend insurance coverage to millions of Americans and put new rules on insurers, among many other features. Senators voted 60-39 to stop debate. Final passage of the bill is all but certain. That legislation will then need to be reconciled with the House-passed version, which includes a government insurance plan left out by the Senate and different language on abortion coverage.
Senior Dem: Kill the Senate health reform bill and start over The Senate's healthcare bill is fatally flawed, a senior Democrat atop a powerful committee said on Wednesday. Rep. Louise Slaughter (D-N.Y.), the chairwoman of the House Rules Committee and co-chairwoman of the Congressional Pro-Choice Caucus, said that the Senate's bill is so flawed that it's unlikely to be resolved in conference with the bill to have passed the House. "The Senate health care bill is not worthy of the historic vote that the House took a month ago," Slaughter wrote in an opinion piece for CNN's website.
Abortion funding still hurdle to health bill The way abortions are covered under health care reform is a major obstacle to finalizing the legislation, even though the House and Senate both agree that no federal money should be used. The stumbling block is whether insurance plans that get federal money are completely barred from covering abortions, or whether they can cover it as long as they require customers to write separate checks for the procedure using their own money. Why does that matter?
Don't mess with Texas: More Americans moving in Americans, it seems, still have a love affair with the West. Texas and Wyoming were the big winners in the Census Bureau's annual population estimates, which were released on Wednesday. In the year ended July 1, Texas added more people than any other state, and Wyoming had the highest growth rate in the nation. The population of the United States has grown more than 9% to 307,006,550 since the 2000 census. The population grew 0.86% since last year's estimates. Just three states shrank during the year. Michigan's population fell by 0.33%, Maine dropped 0.11%, and Rhode Island lost 0.03%.
California vs. Greece: Two Economies in Trouble The LA TImes reports that things are not so golden in the Golden State, as Governor Arnold Schwarzenegger once again turns to Washington for help in averting a death spiral. Facing a budget deficit of more than $20 billion, Gov. Arnold Schwarzenegger is expected to call for deep reductions in already suffering local mass transit programs, renew his push to expand oil drilling off the Santa Barbara coast and appeal to Washington for billions of dollars in federal help, according to state officials and lobbyists familiar with the plan.
Apple May Be on the Verge of Kneecapping the Cable Industry The cable companies suck. All of them. Some suck less than others. But they all suck. We need someone to whip them into shape. And that someone may be Apple. Apple may be on the verge of gaining two key television network agreements, according to The Wall Street Journal. Specifically, CBS and Walt Disney (which runs ABC) are said to be considering a proposal by Apple to offer a subscription-based TV service over the Internet. Presumably, this would work through iTunes like all of Apple-based content, but also presumably it would work over Apple’s Apple TV device (though maybe a new version of it) to bring this content into the living room, where people are used to consuming it. Simply put: This could be huge.
Climate-Gate - Michael Coren with Lord Christopher Monckton - part 1 of 5
Climate-Gate. Michael Coren with Lord Christopher Monckton - Part 2 of 5
Climate-Gate - Michael Coren with Lord Christopher Monckton part 3 of 5
Climate-Gate - Michael Coren with Lord Christopher Monckton part 4 of 5
Climate-Gate. Michael Coren with Lord Christopher Monckton part 5 of 5
**** Caution! Message from a globalist: David Rothschild regrets Global Governance tough to activate in Copenhagen "Simon Linnett, Executive Vice-Chairman of Rothschild, has called for a new international body, the World Environment Agency, to regulate carbon trading. In a recently published paper, Trading Emissions, for the Social Market Foundation, Mr Linnett argues that the International problem of climate change demands an international solution. Unless governments cede some of their sovereignty to a new world body, he says, a global carbon trading scheme cannot be enforced and regulated." David Rothschild regrets that Global Governance is proving very hard to activate at the UN climate conference in Copenhagen.
IMF turns down $2bn loan to Ukraine The International Monetary Fund has turned down recession-battered Ukraine’s plea for a $2bn emergency loan before the New Year, a senior Ukrainian official said on Wednesday, citing his country’s failure to adopt a fiscally prudent 2010 budget and muster political consensus ahead of a hotly contested presidential election. But officials said the financially-stretched government had other last-minute options that could allow it receive the needed $2bn in coming months, enough to cover natural gas import bills to Russia’s Gazprom, as well as citizens’ pensions and wages.
E.U. IMF Debt Revolt, Greece, Iceland, Latvia May lead the Way Europe’s small, debt-strapped countries could follow the lead of Argentina and simply walk away from their debts. That would shift the burden to the creditor countries, which could solve the problem merely by a change in accounting rules. Total financial collapse, once a problem only for developing countries, has now come to Europe. The International Monetary Fund is imposing its “austerity measures” on the outer circle of the European Union, with Greece, Iceland and Latvia the hardest hit. But these are not your ordinary third world debtor supplicants. Historically, the Vikings of Iceland successfully invaded Britain; Latvia n tribes repulsed the Vikings; and the Greeks conquered the whole Persian empire. If anyone can stand up to the IMF, these stalwart European warriors can.
On the Edge with Max Keiser - 18 December 2009 (1/3)
On the Edge with Max Keiser . . . and Edward Harrison (2/3)
On the Edge with Max Keiser . . . and Edward Harrison (3/3)
Gold at $1,400 in 2010 Almost all analysts have revised their gold price forecast in the recent past and latest in the list is JP Morgan. JP Morgan analyst John Bridges said gold will hit a whopping $1,400 to $1,450 an ounce in the second quarter of 2010 before slipping back. According to Bridges, there is literally no reason to believe that the gold rally is going to end soon. According to a report in Financial Post, his main rationale for this argument is US dollar weakness, which he expects will continue until mid-2010. Forex strategists at JP Morgan are calling for the greenback to weaken to a new all-time lows against the euro (1.62) and the yen (82). While they do not expect the dollar to fall off a cliff, they think it will remain weak because of the Federal Reserve's belief that core inflation is not a problem right now.
Gold Santa, What's in His Toybag? WHY is gold falling? One of you asked this yesterday. Responding to price is important, but why is gold falling? In the end, gold is falling because there are more sellers than buyers. Breaking that down, the US dollar is rising, and gold moves - usually - opposite to the US dollar. Technically, as gold rose to $1200, many of the indicators were at points that would attract more technical sellers than buyers, and as various chart support and trend points failed, more sellers came in. Items rise and fall. Gold rose from $905 with almost no down. All the way to $1225. That's a $300 move, a 30% move, in price. If you are looking for a general explanation of why gold rises or falls, it is usually, but not always, because the US dollar is doing the opposite.
Cartel controlling gold price about to be smashed Gold behaved as predicted in last weekend's update - it rallied into the middle of last week before plunging on Thursday and then ended the week with a modest upturn. Thursday's plunge involved a sharp break below our important parabolic uptrend channel, and although the break was not by a decisive margin and gold rallied Friday, this sharp drop has bearish implications. We can see this latest action on the 1-year chart on which we can also see that although gold has broken down from the parabolic uptrend, it has yet to breach the "last ditch" support of the lower boundary of the parallel uptrend channel, which is shown as a dotted line.
The Real Reason Not to Bet Against Gold The much anticipated gold correction hit faster than most expected. After weeks of eerily consistent gains, gold is now shedding anywhere from $20 to $50 on the down days and struggling to post $10 upticks on short-lived rebounds. On top of that, the U.S. dollar is showing its first signs of strength in months. The new trend in gold is down. And as you might expect, the short-sighted “hot money” is finding all the reasons they can to justify selling gold.
US Gold CEO sees gold price soaring “Annual mine production is declining and costs are going up, so that means higher prices,” Rob McEwen, chairman and CEO of US Gold Corporation, said in an interview. “By the end of 2010 I see the gold price at $2000 and before the game’s over at over $5000.” Asked when that might occur, McEwen said: “That will probably be in 2012 to ‘14, because of lack of supply and also gold is money, it’s a currency.
Gold is the top investment tip for 2010 The recent $125 correction in the gold price from $1,226 per ounce leaves some analysts thinking that the bull market is finished. But anybody with even a passing knowledge of investment analysis ought to recognize a buying opportunity rather than the end of an uptrend. Gold has been moving up in $200 steps every two years for the past decade. However, each leg up is characterized by a hesitation and retracement. That is what we are seeing now.
Gold Not Going Up in Price, Money Losing Value
Gold Being Driven Higher by Speculation Not Real Physical Demand Over the last two days, we’ve looked at the current Gold bull market from historical and supply/ demand perspectives. Thus far, the data has lead us to believe that Gold has entered a speculative “mini-bubble” phase in bull market. This scenario can of course change at any time should the public’s demand for physical bullion pick up again. However, until that occurs, Gold is in the same phase that Oil was in 2008: a speculative market in which sharp rallies or corrections can occur at any time.
Gold slides more than $20 in two days Gold prices have taken a dive this week as investors rekindle their faith in the stock market and the almighty dollar. "There are a lot of people throwing in the towel as gold moved below $1,100 for the second day running," said Adam Klopfenstein, senior market strategist at commodities brokerage firm Lind-Waldock. "I do think the bull case for gold is going to be on hold for the rest of the year."
Gold Falls as Dollar Rises, More Central Banks "Will Follow India's Example" Says Marc Faber THE PRICE OF GOLD slipped to a new 7-week low for US investors early Tuesday, dropping through yesterday's low at $1090 per ounce as world stock markets rose and government bonds fell. The US Dollar rose for the ninth time in 13 sessions on the forex market, hitting its best level against the "safe haven" Japanese Yen since the start of November. "There's some speculative demand for gold," said Wolfgang Wrzesniok-Rossbach, sales director at Germany's Heraeus refinery, to Reuters earlier. "There's also physical demand, not so much in Europe but definitely in Asia."
Gold long term bullish, short run correction likely Gold is in a clear bullish trend primarily because of the governments inability to match up the equation of earnings with spending. This is not a local phenomenon but a global one. . . . . . . . . Printing more currency leads to fall in intrinsic value of money thereby we pay more for same level of goods & services. US has been involved in printing dollar since a decade to match its rising deficit which in turn led to increase in money supply leading to rise in prices right from commodities to housing to almost every asset class. Seeing an ever rising opportunity Investment banks and financial institutions relaxed risk norms to earn better profitability and thus exposing themselves to the vulnerable world of financial derivatives, the outcome of which is known to all of us.
Inflation, Here We Come
Gold Fluctuates After Falling Past Two Days on Dollar Outlook Gold fluctuated in early trading in Asia after falling the past two days as a rebounding dollar reduced demand for the precious metal and volumes wane as investors prepare for year-end holidays. The Dollar Index, a six-currency gauge of the greenback’s value, is trading near its highest level in more than three months, on signs of a recovery in the world’s largest economy. Sales of existing U.S. homes reached their highest level in almost three years last month, a report showed yesterday.
Central Banks to step up gold reserves: Marc Faber The Gold Price slipped to a new 7-week low for US investors early Tuesday, dropping through yesterday's low at $1090 per ounce as world stock markets rose and government bonds fell. The US Dollar rose for the ninth time in 13 sessions on the forex market, hitting its best level against the "safe haven" Japanese Yen since the start of November. "There's some speculative demand for gold," said Wolfgang Wrzesniok-Rossbach, sales director at Germany's Heraeus refinery, to Reuters earlier. "There's also physical demand, not so much in Europe but definitely in Asia." "The metal [on Monday] broke last week's low of 1095 and the 4-month rising trend line at 1097," says a technical note from bullion bank Scotia Mocatta.
Russian central bank buys 30 tonnes of gold Adding another reason for the gold prices to shoot up, Russia’s central bank has bought another 30 tonnes of gold for $1 billion as part of its efforts to increase its gold reserves. The money will be used to help ease the crisis in the country’s budget. The cash slightly reduces Russia’s deficit — around 7.3 per cent of gross domestic product this year. The Central Bank is the only government body mandated to engage in foreign commodity and currency trade. The deal marks the first large sale of gold from Russian coffers since the collapse of the Soviet Union. Russia is weathering its worst financial crisis in a decade.
A Case for the Inflation Camp One of the more awkward situations facing Austrian economists today is that we are divided on whether to expect price deflation or inflation. Although it's good that we publicly disagree with each other — rather than bury our disagreements to reassure the lay public that we know what we're talking about — it's nonetheless unsettling that our prognoses for the US dollar are so divergent.
Gerald Celente on www.financialsense.com with Jim Puplava
Third Quarter US GDP Comes In Significantly Lower Than Original Estimates Could we have expected anything else from the Madoff nation, a country whose major export is fraud, and predominant industry a large scale variation of Liar's Poker? GDP in the third quarter is significantly weaker than the results reported in late October. And even the positive value that remains is probably overstated by a chain deflator that underestimates the monetary expansion by the Fed. Ironically it is ineffective because it is so heavily applied to a broken and outsized banking model rather than to the real economy.
NIA's Top 10 Predictions for 2010 The National Inflation Association - http://inflation.us is pleased to announce its top 10 predictions for 2010.
We will learn the 2009 holiday shopping season was a bust.
We will see a major decline in the Dow/Gold ratio.
We will see a sharp decline in the Gold/Silver ratio.
The U.S. Dollar Index will see short-term bounce, then huge crash.
Oil will rise back above $100 per barrel.
There will be a move towards a Libertarian third-party.
Peter Schiff and Rand Paul will both win Republican primaries and be elected to U.S. Senate.
Large 'End the Fed' Protests.
Major Food Shortages.
Paul Volcker Resigns.
Did the Fed Monetize by Stealth? I don’t know if he does those charts himself but they are a work of art! Like some sort of marvellous abstract expressionism, reminds me a bit of Rothko with hard lines. See how the colours are balanced so the ones at the back look like they are behind, that part is reminiscent of Paul Klee, a masterpiece! Mm…now I wonder- what does that big red blob signify? Uh huh…that’s Mortgaged Backed Securities! Now let me get this straight, those are things that the Fed has either purchased or took over as collateral in return for shovelling cash out of the discount window to banks like Goldman Sachs who, since they are now a “regulated” bank (if that’s not a contradiction in terms), are now eligible to feed at that tough.
Why the Fed will fail The set-up for a deflationary collapse - December 2009 Most investors are positioning themselves for an expected up-tick in inflation driven mainly by "quantitative easing" and the expectation that the Fed will not be able to withdraw liquidity later on. Inflation assets are currently being bid up while deflation assets are being bid down. What are deflation assets? These would include shorts, bonds and cash. The covering of shorts only adds to the upward thrust of inflation assets. The effect on price of a sell off in bonds is fairly straight forward (price is bid down and yields go up).
More bailed-out community banks failing to pay U.S. dividends A growing number of community banks that got federal bailouts are failing to pay quarterly dividends they owe to the government, including two banks that got aid after congressional intervention on their behalf, according to data released Monday by the Treasury Department. Fifty-five banks failed to make dividend payments in November, a 67 percent jump over the number of delinquent banks three months earlier.
Red Ink Watch: Red Ink Flowing
The Fed is a Fascist Cartel No one in the freedom movement today disputes that the Federal Reserve is the source of many of our economic woes. Where disagreement arises is in defining the precise nature of the Fed and the source of its capacity to create the harm it does. Many who support gold money and free enterprise claim that the Federal Reserve is a "private corporation" run by capitalist mega-financiers. This I believe to be mistaken.
Bernanke’s Confirmation Support Runs 3-1 in Favor in Senate U.S. senators are backing Federal Reserve Chairman Ben S. Bernanke for a second term by a 3-to-1 margin, based on a count of 77 lawmakers by Bloomberg News. Bloomberg today interviewed 53 senators who aren’t on the Banking Committee, which voted 16-7 on Dec. 17 to recommend Bernanke’s nomination to the full Senate. Twenty-one lawmakers said they are inclined to vote for Bernanke, while four said they would oppose the central bank chief, giving Bernanke 37-12 support so far for a four-year term starting Feb. 1. Another 28 said they’re undecided or declined to comment.
Why the Fed Will Be Sidelined in 2010 The release of the Non-Farm Payroll Report for November along with the latest inflation data from the Bureau of Labor Statistics placed further into question the Federal Reserve’s free money policy. The spate of less bad news on the economy and increases in certain price levels has brought some of the bond vigilantes back from hibernation, while the cacophony from the hard-money guys (me chief among them) to raise interest rates is growing yet louder. But unfortunately in my opinion, the Fed will be watching the economy from the bench for nearly all of 2010. The reason is simple; the central bank already has scheduled a tremendous de facto tightening which will occur at the end of the first quarter. As most of us already know, the Fed will conclude its planned purchases of $1.25 trillion in Mortgage Backed Securities (MBS) in March. The problem is that according to the St. Louis Federal Reserve, Mr. Bernanke is responsible for 90% of the purchases of all newly issued agency MBS. That means the Fed is the securitization market for mortgages.
Gerald Celente Blacklisted Radio with Michael Vail 16 Dec 2009
The Long Decline of the U.S. Economy The official position on the cause of the current financial downturn is that it was caused by the reckless practices of financial institutions and the failure of regulatory bodies, and it is likely that these were the proximate causes, but they were not the ultimate cause. Americans, unfortunately, are rarely willing to search for ultimate causes or do anything about them when they are found.
An Organ Grinder's Monkey Couldn’t have Done Any Worse As we look back and this year comes to an end we find two plus years of failure. Even government admits to 1-1/2 years of negative growth - a sorry record after having poured trillions of dollars into the economy. The recent 3rd quarter results supposedly broke that record. If it did it was the result of government stimulus and Fed monetization. If you look back further you will find a stock market that rallied 54% just to reflect the highs of 1999. House prices have decline to 1990s levels as well. Both markets, which were bubbles, next year will fall again. Americans opened their markets to products of Communist China’s slave labor and China became the world’s biggest exporter. Via free trade, globalization, offshoring and outsourcing, transnational conglomerates have stolen America’s destiny and handed it to China. This is what corporatist fascism is all about.
The Recession Is Over but the Economic Depression Has Just Begun Edward Harrison writes: This is an updated version of a post I wrote about two-and-a-half months ago over at Credit Writedowns. When I wrote it, I had been looking for bullish data points as counterfactuals to my bearish long-term outlook. I found some, but not nearly enough. Early this year, I wrote a post “We are in depression,” which called the ongoing downturn a depression with a small “d.” I was optimistic that policymakers could engineer a fake recovery predicated on stimulus and asset price reflation – and this was bullish for financial shares if not the broader stock market. But, we are witnessing temporary salves for a deeper structural problem.
Charles Goodhart warns of return to recession as bank lending fallsThe contraction of bank lending and the M3 money supply in the US and Europe over recent months has become a serious concern and raises the risk of a slide back into recession, according to one of Britain's most celebrated economists. Professor Charles Goodhart, a former top official at the Bank of England now at the London School of Economics, said policymakers have neglected the flashing danger signal of the monetary data. "What has happened to all the monetarists? Growth in money holdings and lending has plummeted. Thirty, or 40, years ago they would have been forewarning doom and destruction at this juncture, and casting anathemas at the authorities," he wrote in a consultant report for Morgan Stanley. "There is a danger that markets and authorities become obsessed about the fiscal implications of the crisis at a time when the real worries should still focus on private sector access to credit and money."
Small Banks Speak Out
Small banks, big problems The New Year is shaping up to be a rough one for community lenders. Dozens if not hundreds of small banks figure to disappear in 2010, as a weak economy and regulatory pressure lead to more failures and mergers. Despite this reality, President Obama met Tuesday with eight community bank executives, including the chiefs of German American Bancorp (GABC) and Monadnock Bancorp. Obama hailed the bankers as playing a "vital function," and cited "enormous opportunities" for economic growth if they keep lending.
Is the Free Money Party Over? Is the Fed’s free money, economic “reflation” party coming to an end? There are a lot of well-publicized signs it may be. Inflation is starting to tick up. The Labor Department reported this week its inflation measures rose at annual rates of 1.8% (CPI) and 2.4% (PPI). On the unemployment front, “good” news is just around the corner too. The Census Bureau has to finish up its search for 1.4 million temporary workers in the next few months. Also unemployment benefits will start expiring soon for many folks. Which means people will leave the work force or take whatever jobs they can get, both of which reduce the official unemployment rate.
Obama urges community banks to lend more President Obama brought a dozen community bankers to the White House Tuesday to press them to boost their lending to small businesses. The roundtable discussion with regional bank leaders was aimed at figuring out "how we move forward over the next year so that businesses are getting the capital that they need, and that we are starting to see people hired again," Obama said afterward.
Inflation vs Deflation
Why Is Obama Failing? "What's costing the president are three things: a laissez faire style of leadership that appears weak and removed to everyday Americans, a failure to articulate and defend any coherent ideological position on virtually anything, and a widespread perception that he cares more about special interests like bank, credit card, oil and coal, and health and pharmaceutical companies than he does about the people they are shafting." Drew Westen, Leadership Obama Style I think it is more that last of the three than anything else, and explains the others. Obama is captive to special interests, as are many of the key members of the Congress, and the Obama Administration, and the Federal Reserve. And I should add his two predecessors.
It explains why he cannot articulate a coherent ideological position and make it stick. Make no mistake, he is a smart and verbally adept individual, a gifted person intellectually. But he cannot adhere to principles because he has abandoned whatever principles he may have had to serve a variety of corrupting interests. And he appears laissez faire and distant because he is a figurehead, a household servant, and not in control.
Senate rewrites financial reform More than a year after the financial system blew up, efforts to build a better financial regulatory system are just now getting hammered out in the Senate. The big question is: Will it be tough enough? Eight senators have paired up, one from each political party, to negotiate behind closed doors parts of a regulatory reform package that could pass the Senate with a filibuster-proof 60 votes.
Global commodities prices will continue to move higher.
Emerging economies will outgrow their richer, more-mature counterparts.
And the countries that were stingy with their monetary and fiscal bailout plans will now reap the benefits; they will outpace the countries that slashed their interest rates to zero and allowed their deficits to soar.
One country is poised to profit from all three of those trends. What's more, the political worries that always seem to diminish its allure to investors are poised to recede, making this emerging southern hemisphere heavyweight one of the premiere profit opportunities for 2010. I'm talking about Chile.
What You Need to Know About Credit Reform
Opec indicates $70-$80 oil price target The Opec oil cartel on Tuesday gave the strongest indication yet it aims to keep oil prices at $70-$80 a barrel next year as it tries to support the economic recovery. Ali Naimi, Saudi Arabia oil minister and the group’s de facto leader, said the current oil price was “excellent” and added he would like to “keep it that way” in 2010. “Everyone needs this price: this is the future,” the minister said. As a first step, the cartel, which controls more than 40 per cent of the world’s oil output, agreed to leave leave its production levels unchanged at least until March.
US town halls find fresh angles to meet recession “Other duties as assigned,” reads the job description for municipal workers in Siloam Springs, Arkansas. Like the rest of the US, this town of 14,000 in the north-west of the state near the Oklahoma border is grappling with the fallout from a national recession. In response to plummeting revenue, David Cameron, the city administrator, has redrawn the roles of many employees. “Our [revenues from] sales taxes are down 11 per cent but we still need to pick up the trash,” Mr Cameron says. “I pay more money to less people and maximise their use with more tasks.”
U.S. Government Caught in a Lie on Bogus Jobs Data It’s no secret governments and our ruling elite (the bureaucracy) lie for their own benefit, and this has been increasingly prevalent for years now. Perhaps the most well known statistics in this respect center on the Employment Report, viewed as the central economic release of the month by most observers in that employment is seen as the core of the economy. In knowing this, and not forgetting governments lie to us in just about everything, it should be of no surprise then that John Williams of Shadow Government Statistics has been able to make a business out of reporting on irregularities and discrepancies in official statistics, where even though such fraudulent data was sufficient to spark a noticeable sell-off in commodities and precious metals last Friday via bogus jobs numbers, one knows this is more fiction than reality.
Nursing crisis looms as baby boomers age America could be facing a nursing shortage that will worsen exponentially as the population grows older. The problem: Baby boomers are getting older and will require more care than ever, taxing an already strained nursing system. America has had a nursing shortage for years, said Peter Buerhaus, workforce analyst at Vanderbilt University School of Nursing in Nashville, Tenn. But by 2025, the country will be facing a shortfall of 260,000 RNs, he said.
Ron Paul: Foreign Policy Ignored As the health care reform battle rages, Congressman Paul points out the need to also keep paying attention to developments in foreign policy and discusses recent events that could have long-term effects.
Health bill money for hospital sought by Dodd A $100 million item for construction of a university hospital was inserted in the Senate health care bill at the request of Sen. Christopher Dodd, D-Conn., who faces a difficult re-election campaign, his office said Sunday night. The legislation leaves it up to the Health and Human Services Department to decide where the money should be spent, although spokesman Bryan DeAngelis said Dodd hopes to claim it for the University of Connecticut. The provision is included in a 383-page series of changes to the health care bill that Senate Majority Leader Harry Reid, D-Nev., outlined Saturday. Scattered throughout are numerous items sought by individual lawmakers, many of them directing money explicitly to programs or projects in their home states.
Health Coverage for the Jobless Gets a Life Extension Congress gave recently laid-off workers a holiday gift of sorts. Last week it extended a subsidy to help them pay health-insurance premiums. Part of a massive defense bill that passed Saturday, the provision extends the 65% subsidy for six months, for a total of 15 months, and expands eligibility for the program an additional two months -- through February 2010. Without the extension, many unemployed workers faced the prospect of paying much higher premiums or losing coverage all together if they couldn't afford the cost of the coverage, provided through the Consolidated Omnibus Budget Reconciliation Act of 1985.
Health-Care Bill Clears Hurdle, Vote Set for Dec. 24 Democrats moved closer to passing the most sweeping health-care legislation in four decades, clearing their second major hurdle in the Senate and winning the endorsement of the American Medical Association. Democrats today won another party-line procedural vote, keeping the measure on the path to final Senate approval on Dec. 24. The last procedural vote is planned for tomorrow, and the Senate agreed to an 8 a.m. vote the next day for final passage.
Dropping the Bomb on Health Care As business owners undergo the yearly ritual of passing through eye-popping health insurance premium increases to their employees, it's easy to understand why any attempt at health insurance reform would be met with some degree of hope. Unfortunately, President Obama and his Democratic allies in Congress are about to take a very bad system and make it unimaginably worse. While ramming their new legislation through Congress, the Democrats have taken great pains to point out that they do not intend to "socialize medicine." But make no mistake, that's where we're headed. Even if some naïve centrists believe that their efforts have denied the Left a total victory, the practical implications of the current legislation sow the seeds for complete capitulation.
Nebraska Governor on Ben Nelson Deal
Marijuana-Reeking Tour Bus, Red Ferrari Are FDIC’s Crisis Booty The financial crisis that popped the real estate bubble and pushed U.S. bank failures to a 17-year high landed the Federal Deposit Insurance Corp. a rapper’s tour bus that reeked of marijuana. “It smelled so bad of pot after one tour that they had to completely pull out most of the interior and replace it,” said Jerry Jenkins, who sold the bus at Penny Worley Auctioneers after the FDIC acquired it in the collapse of an Atlanta bank. “By the time we got it, it was almost brand-new.”
Mortgages Delinquencies and In-Process Foreclosures Jump Americans' mortgage woes continued to get worse in the third quarter. Just 87.2% of U.S. mortgages were current in the third quarter, a decrease of 1.5% from the previous quarter, according to the OCC and OTS Mortgage Metrics Report released Monday. The Office of the Comptroller of the Currency and the Office of Thrift Supervision report covers 34 million loans totaling $6 trillion in principal balances, about 65% of the U.S. mortgage market. Serious delinquencies jumped to 6.2% of mortgage-servicing portfolios, an increase of 16.7% from the previous quarter. The number of prime borrowers in trouble continues to mount as 3.6% of prime mortgages were more than two months behind on payments, more than double the number in default a year ago.
The New Homeless: Shawn Martin at the Coalition for the Homeless of Central Florida Earlier this year, the National Alliance to End Homelessness estimated that 1.5 million people would be made homeless over the next two years as a result of the recession. In this series of profiles, DailyFinance speaks with some of the people who have fallen victim to layoffs, foreclosure, unforgiving creditors and plain old bad financial luck. Here are their stories. One day four months ago, Shawn Martin of Orlando, Fla., showed up for work at the restaurant where he was a cook -- and learned the business would close two days later. He never got his last paycheck. And with the economic downturn, he has yet to find another job.
The real Rain Man dies of heart attack in home town of Salt Lake City, aged 58 Kim Peek, the real Rain Man whose almost unimaginable powers of memory were coupled with severe disabilities and who inspired the Oscar-winning film role played by Dustin Hoffman, has died of a heart attack in his home town of Salt Lake City, aged 58. Peek has been called a "mega-savant" for his ability to memorise to the word up to 12,000 books, including the Bible and the Book of Mormon. He could read two pages in about 10 seconds – the right page with his right eye and the left simultaneously with his left eye.
Fired for Playing Fantasy Football, or for Being 26 Years Old? Your heart has to go out to Cameron Pettigrew, losing a job in this economy. The 26-year-old Fidelity Investments employee, along with three others, was fired in October for violating a company policy regarding gambling while participating in fantasy football, a virtual game that utilizes real-life statistics from football players to form fantasy teams and leagues. Employed at the company's office in Westlake, Texas, Pettigrew, who was the commissioner of his fantasy league, told the Fort Worth Star-Telegram that he knew his company had a policy against playing fantasy football while at the office, but it was poorly communicated and ignored by leadership. Pettigrew sent no fantasy football emails at work, he said. But investigators did find two instant messages that had related material.
Climategate: the corruption of Wikipedia (article from today's show with Mark Call) If you want to know the truth about Climategate, definitely don’t use Wikipedia. “Climatic Research Unit e-mail controversy”, is its preferred, mealy-mouthed euphemism to describe the greatest scientific scandal of the modern age. Not that you’d ever guess it was a scandal from the accompanying article. It reads more like a damage-limitation press release put out by concerned friends and sympathisers of the lying, cheating, data-rigging scientists Which funnily enough, is pretty much what it is. Even Wikipedia’s own moderators acknowledge that the entry has been hijacked, as this commentary by an “uninvolved editor” makes clear
Evangelicals, Faith Leaders Push Green Cause at Copenhagen Prominent evangelical leaders along with representatives of other religions are attending the United Nations summit on climate change in Copenhagen this week, where they aim to persuade global leaders to support cuts in carbon emissions. Among the evangelical figures present in Copenhagen are Richard Cizik, former vice president of the National Association of Evangelicals, and Jim Ball, a leader at the Evangelical Environmental Network.
Fitch warns that Britain and France risk losing their AAA rating Fitch Ratings has given its bluntest warning to date that Britain and France risk losing their AAA status unless they map out a clear path to budget discipline over the next year. Highlighting the "unpleasant fiscal arithmetic" facing states across the Old World, Fitch said that none of the "arguably" benchmark AAA states can safely rely on their top rating for much longer. Public debt in both Britain and France will reach 90pc of GDP by 2011, higher than the 80pc (net) level when Japan lost its AAA rating earlier this decade. Japan's error at the time was the failure to set out any serious plan to rein in spending, a lesson that the Europeans need to study closely. "The UK, Spain, and France must articulate credible fiscal consolidation programmes over the coming year, given the budgetary challenges they face in stabilising public debt. Failure to do so will greatly intensify pressure on their sovereign ratings," it said.
Ahmadinejad dismisses nuke deadline TEHRAN -- Iran's president on Tuesday dismissed a year-end deadline set by the Obama administration and the West for Tehran to accept a U.N.-drafted deal to swap enriched uranium for nuclear fuel. The United States warned Iran to take the deadline seriously. President Mahmoud Ahmadinejad also accused the United States of fabricating a purported Iranian secret document that appears to lay out a plan for developing a critical component of an atomic bomb.
Greece Too Corrupt To Be Bailed Out? “Greece is a beautiful, mountainous country with diverse natural scenery. Geographically, it occupies the majority area of the ancient Hellenic world at the southern part of the Balkan peninsula and the eastern part of the European community. It has a land area of 130,800 square kilometers. Its coastline extends for 13,676 kilometers, with 227 inhabited islands that rest on a sea of amazing clarity. Historical monuments abound, making the land a virtual museum and attracting millions of tourists every year. It has a population, according to the 2001 census, of 10,964,020, and a per capita GDP of $30,681. It boasts the largest ownership of shipping tonnage (tanker and cargo) in the world, with a total dwt of 141,931 thousand. It owns some of the largest natural resources in specific minerals in the EU, such as bauxite, magnetite, nickel, and perlite. There are also has anhydrite, gypsum., bentonite, gold. cement, magnesium compounds, pumice, and of course marble. In addition it has large flocks of livestock and fish stock. The abundant sun shine and the winds make it potentially self sufficient in clean energy.
How do I know China wrecked the Copenhagen deal? I was in the room As recriminations fly post-Copenhagen, one writer offers a fly-on-the-wall account of how talks failed Copenhagen was a disaster. That much is agreed. But the truth about what actually happened is in danger of being lost amid the spin and inevitable mutual recriminations. The truth is this: China wrecked the talks, intentionally humiliated Barack Obama, and insisted on an awful "deal" so western leaders would walk away carrying the blame. How do I know this? Because I was in the room and saw it happen. China's strategy was simple: block the open negotiations for two weeks, and then ensure that the closed-door deal made it look as if the west had failed the world's poor once again. And sure enough, the aid agencies, civil society movements and environmental groups all took the bait. The failure was "the inevitable result of rich countries refusing adequately and fairly to shoulder their overwhelming responsibility", said Christian Aid. "Rich countries have bullied developing nations," fumed Friends of the Earth International.
Snarky Disinformation About Gold and the Nature of Money We're going to review your 2010 asset allocation strategy in a roundabout way by exposing some of the snarky disinformation being put out by the mainstream media about gold, courtesy of Michael Pascoe at The Age. First though, let's just check to see that markets are still functioning normally. That is, let's just check to see that heavy government intervention is supporting house prices (by providing guarantees to home lenders), GDP growth (by spending money on infrastructure), and disguising the true state of the labour market (by lying about how many people are out of work). Yep. Situation normal, all fouled up. The oil price, the U.S. dollar, and bond yields were all up on bullish industrial production figures in the U.S. The "recovery" meme is taking a tenuous hold. Stocks were down. Because why would stocks rise if the economy were recovering?
The Inflation Bomb Hiding On The Fed's Balance Sheet However much it infuriates people like Paul Krugman to hear analysts warn about inflation while the economy is still sputtering along joblessly, there is good reason to worry about the ability of the Federal Reserve to prevent the massive build up of the monetary base from resulting in out of control inflation.
The Small Business Carnage That Shows The Real Reason Jobs Aren't Being Created In America While some parts of the U.S. economy show early signs of an economic rebound, for small business, the situation remains extremely tough. Latest December small business conditions reported by the National Federation of Independent Business makes this very clear. None of the optimism shown by major U.S. corporations can be found.
Bigger Than Watergate ACORN critic Rep. Steve King (R-Iowa) is mystified that both the Democratic-controlled Congress and the Obama administration aren't doing much about the tax-subsidized organized crime syndicate ACORN even as evidence of its wrongdoing continues to pile up. In an exclusive interview, the House Judiciary Committee member describes the ACORN saga as "the largest corruption crisis in the history of America." "It's thousands of times bigger than Watergate because Watergate was only a little break-in by a couple of guys," said King. "By the time we pull ACORN out by its roots America's going to understand just how big this is."
Bernanke Tightens the Noose Brace Yourself for a Hard Landing Ben Bernanke has been a bigger disaster than Hurricane Katrina. But the senate is about to re-up him for another four-year term. What are they thinking? Bernanke helped Greenspan inflate the biggest speculative bubble of all time, and still maintains that he never saw it growing. Right. How can retail housing leap from $12 trillion to $21 trillion in 7 years (1999 to 2006) without popping up on the Fed's radar?
More bailed-out community banks failing to pay U.S. dividends A growing number of community banks that got federal bailouts are failing to pay quarterly dividends they owe to the government, including two banks that got aid after congressional intervention on their behalf, according to data released Monday by the Treasury Department. Fifty-five banks failed to make dividend payments in November, a 67 percent jump over the number of delinquent banks three months earlier.
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Banks with political ties did best with bailouts, study concludes NEW YORK -- U.S. banks that spent more money on lobbying were more likely to get government bailout money, according to a study released on Monday. Banks whose executives served on Federal Reserve boards were more likely to receive government bailout funds from the Troubled Asset Relief Program, according to the study from Ran Duchin and Denis Sosyura, professors at the University of Michigan's Ross School of Business. Banks with headquarters in the district of a U.S. House of Representatives member who serves on a committee or subcommittee relating to TARP also received more funds.
Fed's approach to regulation left banks exposed to crisis Foreclosures already pocked Chicago's poorer neighborhoods but the downtown still was booming as the Federal Reserve Bank of Chicago convened its annual conference in May 2007. The keynote speaker, Federal Reserve Chairman Ben S. Bernanke, assured the bankers and businessmen gathered at the Westin Hotel on Michigan Avenue that their prosperity was not threatened by the plight of borrowers struggling to repay high-cost subprime loans.
Serious U.S. mortgage delinquencies up 20 percent Serious delinquencies among U.S. prime mortgages rose nearly 20 percent in the third quarter from the prior quarter, as the percentage of current and performing mortgages fell for the sixth consecutive quarter, banking regulators said on Monday. The report by the Office of Comptroller of the Currency and the Office of Thrift Supervision, which are part of the Treasury Department, covered about two-thirds of all U.S. mortgages.
Dreading our future I am a baby boomer, which is to say my life has coincided with turbulent and awesome times. From the Cold War to Vietnam, from Watergate to Monicagate, through the horrors of 9/11 and the stunning lifestyle advances, my generation's era has been historic and exciting. Yet for all the drama and change, the years only occasionally instilled in me the sensation I feel almost constantly now. I am afraid for my country. I am afraid - actually, certain - we are losing the heart and soul that made America unique in human history. Yes, we have enemies, but the greatest danger comes from within. Watching the freak show in Copenhagen last week, I was alternately furious and filled with dread. The world has gone absolutely bonkers and lunatics are in charge.
Nervous money will limit gold's downside risks A more sober assessment of gold's likely price patterns suggests upwards movement may be limited for the time being, but downside risk is also relatively muted. There is no shortage of advice for the gold investor available on the internet and much of it is wildly contradictory. There are those predicting a crash as the price has come off the boil, while others predict heady heights ahead. You pay your money and you take your choice the expression used to be - but now most of the advice comes thrust at you for free - although in many cases it comes with exhortations to buy some newsletter or investment service or other.
The Coming Shortage Of All The World's Most Important Industrial Metals There's been a a lot of discussion lately about so-called peak gold. But as gold's fans will tell you gold isn't a commodity, it's a form of money. Gold isn't actually intended to be used in anything. But what about metals that are meant to be used in industrial purposes.
Salbuchi - 2010 Forecast: Transition from Globalization to World Government -2 of 3
The Dollar, Euro and Gold What we warned of seems to have come to pass. Since publishing the two articles titled “The Gold Bull; time for a breather or? And “Bonds and Gold”, gold has shed almost 127 dollars. This is but a small drop in the bucket in comparison to the gains Gold has made in the past few months. We are not against gold, in fact, we are long term bulls, but we cannot simply ignore the short term developments and blindly hope that Gold will race higher. No market, not matter how strong it is can rally upward indefinitely without pulling back and Gold is no exception to this rule. Thus what we have said so far in our previous articles and what we have to say now might spoil the current party, but that’s life; all parties must end in order to make way for new ones down the line.
Gold Trends, Hot Commodities and the Major Indexes, What’s Next? Gold has been leading the market for almost a year. Last week gold and gold stocks were trading at support looking ready to bottom but as you will see in my charts below, both broke support on heavy volume. With gold now underperforming the stocks market, I get the feeling we could see the broad market top. Topping is a process and after this strong climb I figure it will be choppy (tough to trade). Much like the price action on the Dow and S&P500 the past month, but this time it will be on a larger scale.
Christmas Comes Early For Precious Metals Buyers Interestingly enough the long inverse correlation between the large US markets and the US dollar has seemingly broken down. Since March 2009 the dollar has been in a protracted downtrend while the markets have risen steadily. The US dollar broke out of the downtrend this past week while the US markets did no such thing technically. Their moves were similar on a percentage basis, but night and day technically. We shall see if this correlation has indeed broken down once the new year is rung in. Right now, and for the rest of the year, trading will be thin. That can exaggerate moves either way, without really having any significance.
Chinese Withdraw Offer For Nevada Gold Concern company controlled by the Chinese government has withdrawn its bid to buy majority control of a small Nevada gold mining operation after Obama administration officials, pointing to a nearby Navy air station, raised national security concerns about the deal. The decision by the company, Northwest Nonferrous International Investment Company, averts a showdown over its proposed $26 million purchase of a 51 percent stake in the Firstgold Corporation. The Treasury Department was prepared on Monday to recommend that President Obama block the sale.
Gold Price Plummets While Gold Bears and Gold Bulls Battle The gold price plummeted $19.43 to $1,092.57 and gold mining stocks followed as continued strength in the U.S. dollar sent the prices of gold-related investments lower. The U.S. dollar has appreciated as short dollar trades are unwound in anticipation of brighter growth prospects for corporate America and an eventual end to the crisis-driven monetary policy of the Federal Reserve. This has been apparent in the price action in the bond market as the 10-year yield reached 3.69%, its highest level in four months.
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Gold investment demand rises as prices fall The recent fall in Gold Prices could result in an upturn in the number of people investing in the yellow metal as they look to capitalize on cost reduction. That is the opinion of Stephen Platt, a commodity analyst at Archer Financial Services Inc. in Chicago, who made his comments following futures dropping below $1,100 on Friday for the first time since November 10th. He said: "Gold prices have fallen down to a level where you might start to revive investment demand. There's a lot of reallocation going on.
Gold price may pull back to $1000 It was not so long ago that I was writing about the weak US dollar and how it was one of the main reasons why the gold price was increasing. But, since around the middle of November we have seen resurgence in the value of the US dollar and now this reversal in trends is putting some pressure on the gold price. During the last few weeks the US dollar has gained around 5%, and during last week, the Euro dropped sharply against the greenback on news that Greece was downgraded by a second credit rating agency. Just two days after the Greek government unveiled measures to trim its debt by cutting 10% in public spending, S&P downgraded Greece's government debt rating from A- to BBB+, reflecting their opinion that the measures are "unlikely...to lead to a sustainable reduction in the public debt burden."
Gold prices may fall as stronger dollar curbs demand LONDON -- Gold, little changed in London, may decline as gains in the value of the dollar curb demand for the metal as an alternative investment. The dollar rose as much as 0.4 percent against the euro to trade near a three-month high amid signs that the world's largest economy is gaining traction. Last week, gold fell for a third straight week, touching the lowest level since Nov. 6 as the U.S. currency rebounded.
Gold prices fall as New Year nears The weekend brought our few additional gold buyers overseas, as Friday’s better than 1% gain in gold prices dampened the bargain-hunting spirits. At the start of the new week, the best thing that could be said about the metals, the dollar, and other markets was that steadiness was manifest. Whether or not such calm is of the typical variety that one sees prior to a little storm of volatility (exacerbated by thinness in participation), remains to be seen.
Mint reveals location of missing gold OTTAWA -- More than $3-million in government gold was unwittingly sold off at a fraction of its value as refinery slag, while $8-million more was miscounted and never left the Royal Canadian Mint, the Crown corporation revealed on Monday in a full accounting of how it lost track of a fortune in gold for a year. A series of miscalculations and blunders in the mint's gold refinery dating back to 2005 were responsible for 17,500 troy ounces -- a system of weights for precious metals -- of gold going missing from the mint's Ottawa inventory count last October, the mint announced in a 12-page report. That's the equivalent of almost 44,400-ounce bars, worth more than $20-million in today's prices.
Russia transfers R7.65 billion worth gold to central bank Russia's Finance Ministry has sold 30 metric tons of gold to the country's Central Bank for $1 billion (R7.65 billion), an official said Monday, saying the cash will be use to help ease the crisis in the country's budget. The cash slightly reduces Russia's deficit - reportedly around 7.3 percent of gross domestic product this year. The Central Bank is the only government body mandated to engage in foreign commodity and currency trade.
Silver's smart run to continue in 2010 Till now, market analysts have been going ga-ga over the rise and rise of gold prices but silver has been shining better than gold in 2009 and this trend is set to continue in 2010 also. Driven by demand from auto sector for silver-zinc batteries which are used in 'smart automobiles' and an array of portable electronic devices, the silver's shining story will continue in the coming year also.
interest rates, death tax, health care
Can the Dollar Rally Continue? Doing God's work Everyone is talking about the strength in the dollar now and reflecting on what it means for gold. Many are expressing surprise at how fast it jumped up. That is why I try to convey to you a sense of urgency when I speak of stop loss orders. When the Fat boys pull their nets in, they don't want any fish getting out. Always have a stop loss order in place, I put my stop loss in before I place my buy order. Think back to about two weeks ago. Do you remember how the media and every analyst was talking about the demise of the dollar. It is easy to succumb to that drum beat and join the lemmings on their march over the cliff. Remember how strong the pull was, it is a good lesson.
Dollar Drives Down Gold Prices Gold prices get pounded by a stronger U.S. dollar. Gold continues to stay in a tight trading range as any U.S. dollar strength and subsequent weakness in gold prices is offset by bargain hunting. Investors seem torn between an optimistic global economic recovery, which would increase risk appetite for assets like gold, and pessimistic credit woes, which would buoy the U.S. dollar and pressure precious metal prices.
Dollar Trades Near Three-Month High on U.S. Economy, Rate View The dollar traded near the strongest level in more than three months against the euro on speculation the Federal Reserve will withdraw stimulus earlier than expected on signs the U.S. economic recovery is gaining momentum. The greenback reached the highest level in more than a month against the yen before reports this week forecast to show increases in U.S. personal spending and home sales. The Japanese currency fell after Bank of Japan Governor Masaaki Shirakawa said he will “persistently” keep policy rates at “virtually zero” and the yield spread of U.S. debt over Japanese bonds reached the widest in more than a year.
U.S. recovery expectations drive dollar up, gold down Optimism about the economic recovery Monday encouraged investors to buy stocks and dump U.S. Treasurys, while gold prices fell as investors expected the dollar to remain firm in the beginning of 2010. Expectations that the U.S. economy is reviving drove the dollar to more than a six-week high against the yen and kept it near its strongest level against the euro in three months. The price of oil rose on concerns about the security of energy facilities in Iraq and Nigeria, and as cold weather on both sides of the Atlantic increased fuel demand.
Dollar Would Benefit From a Double-Dip Risk, Barclays Survey Shows A “double-dip” recession is the most “underpriced” risk in financial markets and the dollar would benefit from a renewed bout of market turbulence, according to a Barclays Plc survey. More than 25 percent of the 724 customers surveyed said another downturn in the global economy is the most underestimated risk, the London-based bank said in a statement today. About 21 percent of the participants, including hedge funds, money managers, and central banks, ranked weak-than- expected Chinese growth as the second-biggest risk.
Rand Weakens as Dollar ‘Bounce’ Sparks Concern of Carry Unwind The rand declined to a six-week low against the dollar on speculation the interest-rate appeal of holding South African assets may diminish as the U.S. currency appreciates. The currency of Africa’s biggest economy dropped for a third day, losing as much as 1.6 percent to 7.6869 per dollar, the weakest level since Nov. 5. The rand traded at 7.6853 by 5:26 p.m. in Johannesburg, from 7.5646 on Dec. 18. “When the dollar was weakening a lot of investors borrowed cheaply in dollars to fund carry trades in other currencies,” said John Cairns, head of foreign-exchange research at Rand Merchant Bank in Johannesburg.
US and European stocks advance as dollar stabilises US and European bourses burst higher on Monday, damping demand for haven assets, after the dollar stabilised and Asian markets put in a mixed performance. Those traders from Frankfurt to London and across to New York that were able to overcome the chilly weather challenge and make it to their terminals seemed flushed with festive cheer and determined to end the year on a positive note.
Treasury 10-Year Yields Reach 4-Month High on Inflation Bets Treasuries dropped, pushing 10-year yields to the highest level in four months, on prospects the U.S. government’s final figure for third-quarter gross domestic product will signal accelerating inflation. The yield curve, the gap between shorter- and longer-term debt used as a barometer for the economy, widened to a record as investors bet an accelerating recovery will fuel inflation and hurt demand for unprecedented government debt sales. Government securities extended yesterday’s losses, the largest drop since August, before the U.S. tomorrow announces the sizes of two-, five- and seven-year auctions next week.
Stiglitz Says U.S. Should Prepare for Second Stimulus Nobel Prize-winning economist Joseph Stiglitz says the U.S. needs to prepare for a second stimulus package as there’s a “significant” chance growth will slow in the second half of 2010. The world’s largest economy isn’t likely to expand fast enough to create jobs for new entrants into the labor force or compensate for increases in productivity that will reduce demand for workers, Stiglitz told reporters in Singapore today.
Stiglitz warns US economy may contract in second half of 2010, calls for more stimulus Nobel Prize-winning economist Joseph Stiglitz warned there's a "significant" chance the U.S. economy will contract in the second half of next year, and urged the government to prepare a second stimulus package to spur job creation. "The likelihood of this slowdown is very, very high," Stiglitz told reporters in Singapore. "There is a significant chance that the number will be in the negative range." Stiglitz, a professor at Columbia University, called on Washington to make more funds available to state governments who face a drop in tax revenue. The U.S. economy, the world's largest, must grow at least 3 per cent to create enough jobs for new entrants into the labour force, he said.
U.S. senators propose reinstating Glass-Steagall Act U.S. Senators John McCain and Maria Cantwell proposed reinstating the Depression-era Glass-Steagall Act that split commercial and investment banking to rein in Wall Street firms in response to the financial crisis. "Under our proposal, too-big-to-fail banks would be forced to return to the business of conventional banking, leaving the task of risk taking or management to others," McCain, an Arizona Republican, said at a Washington news conference. A former bank regulator said splitting up companies is "crazy."
Bankers fear sovereign risk in 2010 In normal circumstances, the question of how banks manage their collateral deals with other financial players is not of interest to ordinary mortals. However, these are not normal times. In the past couple of years the risk managers of the world’s largest banks have been forced to confront a series of shocking situations, as seemingly remote events, or “tail risks” as they are dubbed, have come to pass.
NY Fed: Federal Reserve Will Indeed Be Able to Raise Rates A new paper by the Federal Reserve Bank of New York offers some empirical support to the view among senior Federal Reserve officials that they do have the technical means to raise interest rates when needed, despite some naysayers who caution there is too much money in the system to do so effectively. The Fed has pumped $1 trillion into the banking system in the past year, which in theory means all of that cash floating around in the financial system puts downward pressure on bank lending rates, interfering with the Fed’s ability to raise rates as the economy improves to fend off inflation. But there is a way around it: The Fed can pay banks interest on bank reserves of unused cash.
Fed's Evans says low inflation gives Fed breathing room Charles Evans, president of the Chicago Federal Reserve Bank, said on Monday he expects the U.S. economy to grow 3.0 to 3.5 percent over the next 18 months, but that low inflation will give the central bank room to keep monetary policy easy for an extended period. Next year "will definitely be a better year" than 2009, Evans told business television channel CNBC in an interview, but added he expects the jobless rate to creep up further. Evans said he expects the U.S. jobless rate -- currently at 10 percent -- will edge up "a few tenths" before coming down. He said he sees the jobless rate peaking in the spring or summer of 2010.
Lawmakers' OK of defense bill comes at a price President Obama won most of his spending fights with Congress over the Defense Department this year, but it cost several billion dollars of taxpayers' money to buy legislative peace. The $636 billion defense spending bill that Mr. Obama signed into law Monday fully funds his plans for the F-35 Joint Strike Fighter, but Congress added $465 million for an alternate F-35 engine that the Pentagon says it doesn't need or want.
Web retailers extend shipping deadlines Retail Web sites have bumped back deadlines and offer free express shipping after weekend snowstorms kept holiday shoppers home in large areas of the East Coast. Amazon.com has extended the cutoff for standard shipping by one day through Monday. Macy's Web site is offering free shipping through Monday, and J.C. Penney through Tuesday.
The US Misery Index Misery Index (11.84) = Unemployment rate (10) + Inflation rate (1.84) The misery index was initiated by economist Arthur Okun, an adviser to President Lyndon Johnson in the 1960's. It is simply the unemployment rate added to the inflation rate. It is assumed that both a higher rate of unemployment and a worsening of inflation both create economic and social costs for a country. A combination of rising inflation and more people out of work implies a deterioration in economic performance and a rise in the misery index.
Joblessness eats into fast-food sales Fast-food restaurants finally feel slowdown, despite popularity of dollar menus McDonald's, Burger King, Hardee's, other chains continue to emphasize value In 2008, the steep recession dealt only a glancing blow to the fast-food industry. In fact, an inexpensive burger and fries was downright popular. No wonder McDonald's stock was one of only two members of the Dow Jones industrial average that posted a gain last year. But in 2009, economic ugliness caught up with fast food. Customer traffic steadily declined through the year, and by the fourth quarter even McDonald's, which had held up best against the deluge, was experiencing a sales decline in U.S. outlets open at least 13 months. This year, the Golden Arches' stock has been a clear laggard, ranking near the bottom of Dow components.
Small business bankruptcies rise 81% in state With credit tight and consumers still pinching their pennies, many business owners find they can't go on. The Obama administration's new plan to give a boost to small businesses reflects continued trouble in that sector, which is facing new failures even as much of the nation's economy is stabilizing. As credit lines have shrunk and consumers have cut back on spending, thousands of small businesses have closed their doors over the last year. The plight of struggling firms has been aggravated by the reluctance of banks to lend money, said Brian Headd, an economist at the Small Business Administration's office of advocacy.
States' jobless funds are being drained in recession The recession's jobless toll is draining unemployment-compensation funds so fast that according to federal projections, 40 state programs will go broke within two years and need $90 billion in loans to keep issuing the benefit checks. The shortfalls are putting pressure on governments to either raise taxes or shrink the aid payments. Debates over the state benefit programs have already erupted in South Carolina, Nevada, Kansas, Vermont and Indiana. And the budget gaps are expected to spread and become more acute in the coming year, compelling legislators in many states to reconsider their operations.
Michigan wants land banks to spur redevelopment State seeks $290M from feds to fix up blighted properties Michigan is poised to launch an ambitious plan to take control of thousands of foreclosed, blighted and vacant properties statewide through land bank programs, and hopes to get $290 million in federal funds to accomplish it. The state leads the nation with 29 land bank authorities, which are quasi-public agencies whose aim is to spark commercial and residential development in struggling areas. Most states have one or two.
U.S. Commercial Property Falls to Lowest in 7 Years Commercial property values in the U.S. declined in October to the lowest level in more than seven years as unemployment reduced demand for apartments, offices and retail space. The Moody’s/REAL Commercial Property Price Indices fell 1.5 percent in October from September to the lowest since August 2002. Prices were down 36 percent from a year earlier and are 44 percent below the peak in October 2007, Moody’s Investors Service Inc. said in a statement.
Modified mortgages falling into trouble Many borrowers who were helped are finding themselves falling behind Homeowners who get a substantial cut in their monthly mortgage payments still stand a good chance of falling behind again, a report by two federal regulators says. Nearly 40 percent of homeowners who received a loan modification that reduced monthly loan payments by 20 percent or more were at least two months late again within a year, the Office of the Comptroller of the Currency and the Office of Thrift Supervision said Monday.
Modified loans are quickly in default Borrowers fall behind in year One of the biggest challenges to ending the foreclosure crisis is this: A surprising number of homeowners who get their monthly payments reduced fall behind again within a year. When borrowers get into financial trouble, lenders have several ways to help. They can offer grace periods, longer repayment schedules, lower interest rates or reduced balances.
Lower loan payments = fewer redefaults for homeowners It should come as no surprise that fewer troubled borrowers will redefault if their loan payments are lowered in a mortgage modification. Now, there's federal data that shows this is true. Only 18.7% of borrowers who had their loans modified in the second quarter were delinquent three months later, according to a banking regulators' report released Monday. This compares to 30.7% of borrowers in the first quarter. Why the sharp drop in redefaults? Regulators attribute it to their March directive that urged financial institutions to make sure the loan modifications they do are affordable and sustainable.
Apple TV-Service Proposal Gets Some Nibbles CBS Corp. and Walt Disney Co. are considering participating in Apple Inc.'s plan to offer television subscriptions over the Internet, according to people familiar with the matter, as Apple prepares a potential new competitor to cable and satellite TV. The proposed service by the maker of iPhones and iPod music players could, in at least some scenarios, offer access to some TV shows from a selection of major U.S. television networks for a monthly fee, according to people familiar with the discussions. Apple is pushing to complete licensing deals and hopes to introduce the service in 2010, some of those people said. It is unclear whether any networks have signed on yet.
Holiday Cliff Hanger: Stores Hope Last-Minute Shoppers Boost Season The storm that battered the East Coast over the weekend pushed already-delayed holiday shoppers even later, leaving retailers still uncertain about how well the season will end up. More than 40% of consumers still have holiday shopping left to do, nearly double the share of a year ago and the highest in 10 years, according to a survey taken over the weekend and released Monday by America's Research Group and UBS Investment Research.
Holiday shoppers use cash, miles -- anything but credit cards Shoppers are doing all they can to keep their credit cards in their wallets this holiday season. They're paying with cash or debit cards, using layaway plans and even exchanging frequent flier miles for cash to buy gifts. When they pull a credit card, it's at a store that doesn't charge interest for up to six months. A desire to stick to a budget and to avoid interest rates that have risen sharply have helped drive a marked shift away from credit cards. Banks have also reduced the amount of credit they're making available, even to low-risk clients.
Honda Plans New Plant in China BEIJING – Japan's Honda Motor Co., joining a host of global auto makers expanding production capacity in China, plans to build a new plant in the country to keep up with surging demand, according to two company executives. The executives said one of Honda's main joint ventures is getting close to using up the capacity of a plant it operates in the city of Wuhan in Hubei province. That venture, with Dongfeng Motor Group Co., is expected to sell a total of about 200,000 vehicles this year, and its sales are likely to exceed the plant's maximum capacity as early as next year, they said
In Ireland's deep budget cuts, an omen for a heavily indebted United States? DUBLIN -- Is this the ghost of America's future? Like other heavily indebted nations around the world, Ireland is borrowing vast sums from foreign investors to plug its budget deficit. Fearing that the country will buckle under the weight of so much debt, the Irish have an answer: Put the government on a diet.
ECB Member: We Will Not Save Greece The euro fell against the dollar Monday on heightened concerns about the huge debts of certain European countries, notably Greece. In London morning deals, the single currency fell to $1.4327 from $1.4343 in New York late on Friday. Against the Japanese currency, the dollar rose to 90.42 yen from 90.40 yen on Friday. The dollar was supported against the euro by recent upbeat US economic data that contrasted with gloomy news from Europe, where worries are growing that government debt problems may threaten an economic recovery, dealers said.
U.S.-Backed Climate Deal to Give Obama Sway in Senate The first offer by China and India to limit greenhouse gases in a global agreement may help U.S. President Barack Obama win over members of the Senate who don’t want to impose similar restrictions on American companies. The accord brokered by the three countries last week at United Nations talks in Copenhagen, while not legally binding, also calls for international verification. That addresses demands by senators who oppose UN rules that may hurt U.S. businesses’ ability to compete in the global marketplace.
Dubai World fails to seal deal on debt talks Dubai World today failed to reach agreement on a suspension of its $22 billion debt repayments after a day of talks with more than 90 banks. The state-owned conglomerate insisted that negotiations had been constructive and that the group will be ready to set out a comprehensive proposal for restructuring the debt “within weeks”. Instead, negotiations focused on information-sharing between the group and its creditors, with both sides stressing that the restructuring would be long and complex.
Obama on the brink of a dream as deals seal vote to back healthcare revolution President Obama’s vision of near universal healthcare took a big step closer to reality yesterday when his plans secured a watertight majority in the Senate. With Washington covered in 2ft of snow and some senators flown in on government jets to make sure they were there for the 1am roll call, all 58 Democrats and the chamber’s two independents held together to deliver the 60 votes needed to cut off Republican efforts to block the Bill.
Democrats: Stop screaming and pass health reform For progressives, the question on the health-care battle going forward is not whether they have a right to be angry but whether they can direct their fury toward constructive ends. The alternative is to pursue a temporarily satisfying and ultimately self-defeating politics of protest. Of course what has happened on the health-care bill is enraging. It's quite clear that substantial majorities in both houses of Congress favored either a public option or a Medicare buy-in.
AMA backs Senate health care bill The American Medical Association gave its support Monday to the Senate's latest health-care reform bill as a result of several key changes. Dr. Cecil B. Wilson, the group's president-elect, said the major changes to the bill -- which passed a key vote early Monday morning -- include more coverage for preventive and wellness care and more research to help patients and physicians make better decisions about treatment.
Castro: Obama seeking to topple Cuban communism HAVANA - Raul Castro gave the strongest signal yet his government's would-be honeymoon with the Obama administration is over, delivering a harshly worded speech Sunday charging that the White House endorses efforts to topple the island's communist system. Offering Cuba's first public acknowledgment of the arrest of an American contractor, Castro said the case shows "the United States won't quit trying to destroy the revolution and bring a change to our economic and social regime."
Colombia denies Venezuela's claims of spy drones Colombia has denied spying on Venezuela using an unmanned drone aircraft built with US technology. The allegation was made on Sunday by the Venezuelan President, Hugo Chavez. He claimed the drone aircraft flew over a Venezuelan military base "a few days ago" and took a number of photographs, before disappearing. But the Colombian defence minister said his country had no access to drones - and joked that perhaps Venezuelan soldiers saw Santa's sleigh instead.
Philippine volcano Mount Mayon 'may erupt within days' Scientists in the Philippines have raised the alert level for the volatile volcano Mount Mayon, amid fears of an imminent eruption. It is now at four out of a possible five, meaning a hazardous eruption "is possible within days". Level five is when a major eruption has begun. Scientists raised the level after the number of volcanic earthquakes more than doubled on Sunday. The cone-shaped volcano has already been emitting lava and ash for days.
Social unrest 'on the rise' in China Social unrest is on the rise in China, according to an analysis by a Chinese think-tank. The country is grappling with more acute social problems than ever before, according to a report from the Chinese Academy of Social Sciences. Crime is also up, despite a nationwide campaign to shore up social stability. Although continued economic growth has provided a greater number of jobs, China has seen more social conflict in 2009 than before.
Ahmadinejad denies Iran nuclear bomb trigger tests Iranian President Mahmoud Ahmadinejad has said a document apparently showing that Tehran plans to test a trigger for a nuclear bomb is a US forgery. In an interview filmed on Friday with ABC News, Mr Ahmadinejad said the report in the Times newspaper was "fundamentally not true". Mr. Ahmadinejad said criticism of Iran's nuclear programme had become "a repetitive and tasteless joke".
Pentagon must ready Iran options: top U.S. officer Diplomacy remains the best course for curbing Iran's nuclear ambitions but the Pentagon must have military options ready should President Barack Obama call for them, the top U.S. military officer said on Monday. In an annual assessment of the nation's military priorities, the chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, offered no details about what those options might entail but said using force would have limited effect. "My belief remains that political means are the best tools to attain regional security and that military force will have limited results," Mullen wrote. "However, should the president call for military options, we must have them ready."
Iran faces 'significant new sanctions', US warns Iran faces "significant" new sanctions over its nuclear programme, according to US Defence Secretary Robert Gates. And he reiterated that all options - including possible military action - should stay on the table. Mr Gates was speaking to US troops during a visit to northern Iraq. His comments come a day after the US, Britain and France warned that Iran faced tougher sanctions unless it immediately complied with UN Security Council resolutions.
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There'll be nowhere to run from the new world government 'Global' thinking won't necessarily solve the world's problems, says Janet Daley There is scope for debate – and innumerable newspaper quizzes – about who was the most influential public figure of the year, or which the most significant event. But there can be little doubt which word won the prize for most important adjective. 2009 was the year in which "global" swept the rest of the political lexicon into obscurity. There were "global crises" and "global challenges", the only possible resolution to which lay in "global solutions" necessitating "global agreements". Gordon Brown actually suggested something called a "global alliance" in response to climate change. (Would this be an alliance against the Axis of Extra-Terrestrials?)
Obama Ordered U.S. Military Strike on Yemen Terrorists On orders from President Barack Obama, the U.S. military launched cruise missiles early Thursday against two suspected al-Qaeda sites in Yemen, administration officials told ABC News in a report broadcast on ABC World News with Charles Gibson. One of the targeted sites was a suspected al Qaeda training camp north of the capitol, Sanaa, and the second target was a location where officials said "an imminent attack against a U.S. asset was being planned."
US Attack Kills 120 In Yemen On orders from President Barack Obama, the U.S. military launched cruise missiles against two suspected al-Qaeda sites in Yemen, administration officials told ABC News in a report broadcast on ABC World News with Charles Gibson. American officials said the missile strikes were intended to disrupt a growing threat from the al Qaeda branch in Yemen, which claims to coordinate terror attacks against neighboring Saudi Arabia. The al Qaeda presence in Yemen has been steadily growing in the last two years. According to Richard Barrett, coordinator of the UN's Taliban al=Qaeda Sanctions Monitoring Committee, "Al Qaeda generally has been pushed into these ungoverned areas, whether it is the Afghanistan-Pakistan border area [or Yemen]," "I think many of the key people have moved to Yemen."
Bank Failure Friday: 7 Banks Go Down, 3 with No Buyer It was another busy Friday for regulators, as they closed seven banks, bringing this year’s total to 140. As always, we’ve updated our complete list of failed banks [http://projects.propublica.org/tables/failed-banks/]. The failures figure to continue in 2010. FDIC Chair Sheila Bair said last month failures will “peak” next year. The FDIC’s recently announced budget for 2010 reflects that: In order the handle bank closings, the agency plans to add 1,600 temporary employees to its staff of about seven thousand. The FDIC said last month that its list of “problem” banks has risen to 552.
Inflation Nation The Movie Part 1/3 - Dollar Collapse Ft. Peter Schiff Ron Paul Faber Rogers Inflation Nation - Dollar Collapse starring Peter Schiff, Ron Paul, Rand Paul, Marc Faber, Jim Rogers, and others. The dollar has been in an orderly decline for the past 10 years. Can the United States change course or is it doomed to be another cautionary tale?
Bank failure tally reaches 140 Banks in six U.S. states were closed Friday, bringing the total number of failed banks this year to 140, at a cost of over $1 billion to the Federal Deposit Insurance Corporation. Among the institutions seized by regulators was a so-called "bankers' bank" in Illinois called Independent Bankers' Bank (IBB), which had about 450 client banks in four U.S. states.
Feds shutter 7 banks for a total of 140 failures this year Regulators on Friday shut down two big California banks, as well as banks in Alabama, Florida, Georgia, Michigan and Illinois, bringing to 140 the number of U.S. banks brought down this year by the weak economy and mounting loan defaults. The Federal Deposit Insurance Corp. took over all seven. Regulators shuttered First Federal Bank of California, based in Santa Monica, with $6.1 billion in assets and $4.5 billion in deposits, as was Imperial Capital Bank of La Jolla, Calif., with about $4 billion in assets and $2.8 billion in deposits.
First Federal Bank of California and Imperial Capital Bank of La Jolla closed Both are sold immediately to other Southern California institutions. Regulators have closed 140 U.S. banks this year, 16 in California. Two more loss-battered Southern California banks were shut down by regulators Friday and immediately sold to two of the largest financial institutions based in the region. Stung by defaults on tricky adjustable mortgages, 80-year-old First Federal Bank of California was closed by federal savings and loan regulators, with its 39 branches to reopen today as part of OneWest Bank.
Midnight in the food-stamp economy At 11 p.m. on the last day of the month, shoppers flock to the nearest Walmart. They load their carts with food and household items and wait for the midnight hour. That's when food stamp credits are loaded on their electronic benefits transfer cards. "Once the clock strikes midnight and EBT cards are charged, you can see our results start to tick up," says Tom Schoewe, Wal-Mart Stores Inc's chief financial officer. As food stamps become an increasingly common currency in a struggling U.S. economy, they are dictating changes in how even the biggest retailers do business.
Utility Bill Is One More Casualty of Recession PROVIDENCE, R.I. — For the Cardente family, the shutoff of their electricity and gas in September was a wrenching marker in a two-year downslide. A run of mishaps, including illness and the husband’s workplace injury, extensive structural damage from a burst water bed and the mother’s layoff from a nursing job, had already upended their middle-class lives. Then the pile of utility bills emerged as a headache to rival the past-due mortgage. “You always try to pay your mortgage or rent to keep a roof over your head,” said Debra Cardente, the mother. “Then you ask, do you pay your electric or gas bill, pay your telephone or put food on the table?”
Will the new frugality born of the recession reshape a generation? Helen Wilson knows thrift. In the years after the Great Depression, she raised chickens and planted vegetables at her home in Alexandria to feed her children. Now she smirks a little when her daughter Loretta Haley, 55, describes the recession as "life-changing." "Absolutely I've changed my spending habits," Haley said, as she and her mother came out of a Shoppers Food Warehouse with just a few bags of what she described as "healthy" groceries in a giant shopping cart. "I'm only getting essentials."
Inflation Nation The Movie Part 2/3 - Dollar Collapse Ft. Peter Schiff Ron Paul Faber Rogers
Debt default in a developed country is unthinkable – or is it? Greece’s fiscal travails and ratings downgrades have provided some year-end trades for the speculators who have been betting against the bonds of the least flush euro area governments, and a great deal of material for professionally gloomy commentators such as myself. Most of the product of the euro-commentariat has stopped short of predicting outright default. That would, it is generally understood, be unthinkable for a developed country. It’s the sort of thing done by the Argentines of the world, not Europeans or Americans.
Bankruptcy and Fiscal Collapse, Global Economic Crisis Tipping Point Forecast for Spring 2010 LEAP/E2020 believes that the global systemic crisis will experience a new tipping point from Spring 2010. Indeed, at that time, the public finances of the major Western countries are going to become unmanageable, as it will simultaneously become clear that new support measures for the economy are needed because of the failure of the various stimuli in 2009 (1), and that the size of budget deficits preclude any significant new expenditures.
Financial Markets 2010 Scenario's Building My focus over the coming week is in completing the UK inflation analysis and forecast that is at the core of what happens to subsequent market trends as it directly feeds into interest rates, house prices, economy and stocks. Last years analysis and concluding forecasts for RPI and CPI proved remarkably accurate (30 Dec 2008 - UK CPI Inflation, RPI Deflation Forecast 2009) and hence the inflation road map resulted in the generation of many accurate projections for subsequent trends throughout 2009 and especially for UK savers that if they followed my cue of fixing savings at above 5% for 1 - 2 years would not have been burned by the subsequent crash in UK interest rates to pittance of as low as 0.1% on savings accounts, shame on you HBOS.
Why the US Economy is Facing a Very Unhappy New Year? Since US business investment peaked in 2008 it has dropped by 20 per cent. Not to worry though. According to Professor Blinder -- an eminent Princeton economist -- the situation will reverse itself because "plants and equipment wear out". This is an incredible statement for professor of economics to make. It assumes an automatic process that replaces capital once it is consumed. But capital replacement requires a human decision based on the availability of savings and favourable expectations about the future.
The Debt Time Bomb America is staring at total debt of $115 trillion Make no mistake; the developed world is drowning in debt and as outlined above, there are only two viable options – a global economic depression or very high inflation. It is our contention that the policymakers have chosen the latter option and over the following years, we will experience the trauma of severe inflation. Look. The American government is staring at total obligations of US$115 trillion, America’s debt to GDP ratio is off the charts and the American public is also up to its eyeballs in debt. Under this scenario, you can bet your bottom dollar that the American establishment will try to reduce this debt overhang through a process known as monetary inflation. If you have any doubt whatsoever, take a look at Figure 1 which captures the incredible expansion in America’s monetary base. As you can see, over the past two years, the monetary base in America has expanded from US$827 billion to an astonishing US$1.93 trillion! Up until now, this surge in the monetary base has not permeated through the broad economy but once the money velocity picks up, the money supply will zoom and the end result will be surging price inflation.
Inflation Nation The Movie Part 3/3 - Dollar Collapse Ft. Peter Schiff Ron Paul Faber Rogers
Weapon of Monetary Destruction . . . . By way of review, the Fed has only one distinct power: the capacity to create money out of thin air. In the end, and despite all its other powers, this is the one that matters. So if you are interviewing the Fed governor, one would think that this would be the central question: what did you do with the money-creating power to bring about this situation? This is not a "fringe concern." This was a central issue in all 19th century debates on money. It was the primary concern before Keynes within the economic profession. The belief that money manipulations spawns booms and busts was the conventional wisdom even into the 1940s. As late as 1973, F.A. Hayek won the Nobel Prize for his work demonstrating the point.
2010 The Year of Debt Deleveraging It's All About Deleveraging I did a very interesting one-hour show this week with Tom Ashbrook on his National Public Radio syndicated radio show called On Point. About 20 minutes into the show, Professor Jeremy Siegel of Wharton came on, and we had a pleasant debate and lively Q and A with listeners. Jeremy of course was the bull, expecting that next year the US will grow by 5-6%. I was the "bear," expecting growth in the 1-2% range.
Social Credit and Meta-Feudalism . . . . Ideally the elites want the American economy to contract. They desire a constrained and hobbled society which is more demanding, more complex, more controlled, more diverse, more fractured, more local and less efficient. In a word: meta-feudal. To understand a world that is meta-feudal you should watch movies such as “Brazil”, “Roller-Ball” and “Blade Runner”. These worlds are technological but disintegrated and astonishingly unequal. The powers work through fabricated “crises”. The elite set up the current “crisis” through the “originate to distribute” Basel banking agreement of 1998. From this model evolved: the hyper property bubble, the market-fixing credit derivative system, asset laundering off-balance-sheet accounting and the eventual “credit” collapse.
Is Obama Preparing for War in South America? The US media is very critical of Venezuelan President Hugo Chavez. He's frequently denounced as "anti-American", a "leftist strongman", and a dictator. Can you briefly summarize some of the positive social, economic and judicial changes for which Chavez is mainly responsible? Eva Golinger---- The first and foremost important achievement during the Chávez administration is the 1999 Constitution, which, although not written nor decreed by Chávez himself, was created through his vision of change for Venezuela. The 1999 Constitution was, in fact, drafted - written - by the people of Venezuela in one of the most participatory examples of nation building, and then was ratified through popular national referendum by 75% of Venezuelans. The 1999 Constitution is one of the most advanced in the world in the area of human rights. It guarantees the rights to housing, education, healthcare, food, indigenous lands, languages, women's rights, worker's rights, living wages and a whole host of other rights that few other countries recognize on a national level.
Venezuela's Chavez launches new police force CARACAS, Venezuela – President Hugo Chavez launched a federal police force on Sunday that he hopes will change the overwhelmingly negative image most Venezuelans have of their public security forces while reducing crime in one of Latin America's most violent countries. "We are going to defeat crime," Chavez told uniformed cadets belonging to the newly formed National Bolivarian Police Force during his weekly television and radio show. "We are tackling one of our population's most sensitive problems: crime prevention."
Gold Bull Market Is Nowhere Near the Top The U.S. dollar has reigned as the world's reserve currency for more than 60 years. That's a real anomaly in the history of paper money, according to Stansberry & Associates Investment Research founder Porter Stansberry, but the dollar's days on the throne are numbered. With a sea-change in the monetary system on the horizon—and drawing ever-nearer as more and more U.S. creditors turn toward hard assets and away from paper dollars—he tells The Gold Report in this exclusive interview that the world is approaching a return to "at least a de facto gold standard." Porter does not recommend bullion as "insurance" (because that suggests hope for the dollar when there is nothing to pin hope on) but rather as "the perfect natural money."
Gold inches up but firm dollar weighs, ETF up Gold prices inched up on Monday but the dollar's firmness curbed investor appetite for the metal amid light trading ahead of the Christmas holidays.
'US gold reserves value is $6,000 per ounce' The U.S. dollar has reigned as the world's reserve currency for more than 60 years. That's a real anomaly in the history of paper money, according to Stansberry & Associates Investment Research founder Porter Stansberry, but the dollar's days on the throne are numbered. With a sea-change in the monetary system on the horizon—and drawing ever-nearer as more and more U.S. creditors turn toward hard assets and away from paper dollars—he tells The Gold Report in this exclusive interview that the world is approaching a return to "at least a de facto gold standard." Porter does not recommend bullion as "insurance" (because that suggests hope for the dollar when there is nothing to pin hope on) but rather as "the perfect natural money."
Volatility In Markets, Including Gold, Is This A Bad Sign For The Gold Price? Gold, is it inherently Volatile? A 5% correction in one day, is this reasonable? That happened to gold and many would say was consistent with its reputation as a volatile market. But at the same time most markets reflected the same volatility and have recently been doing so regularly. Actually, gold’s reputation as a volatile market [when others are stable] is misplaced.
Gold Hit With a Bear Raid Yesterday Memories of Citi's Eurobond Price Manipulation If the longs had been exiting the market, the open interest would have declined more significantly. These big plunges in price look to be driven by short selling, with weak hands being driven out, and then short covering or determined buyers stepping back in to maintain the overall number of contracts at a relatively steady level. Recall the case in the Euro bond market, wherein Citi came in and sold an enormous volume precipitously, running the stops and driving the price down sharply. The Citi trader came back in and covered his shorts, pocketing the difference in his market disruption based on size. This trading strategy was known as 'the Dr. Evil' trade. Citi Fined for Euro Bond Trades By British Regulator; Italy Indicts Citi Traders; Citi Haunted by Dr. Evil Trades in Europe;
Gold Is the New Tupperware, and You're Invited to the Party It's Much More Fun Than a Pawnshop; the Cash Is Only So-So but Comes in Handy The 1950s were big for Tupperware parties. The 1970s were hot for Mary Kay cosmetics. As this decade hobbles to a close, a new kind of social gathering is invading America's living rooms: the gold party. Shannan DeCesare, 40 years old, brought four gold chains, two unloved bracelets, some earrings that had lost their mates and a couple of other old pieces to her neighbor's house here last week. Minutes later, she was showing off a check for $610. "Merry Christmas to me!" she exclaimed amid applause from the small group of women clustered around host Christine Smith's dining-room table. "Don't tell my husband," she joked, as she pondered how she might spend the loot.
Gold and Silver Correct But What If The Stock Market Really Plunges? The recent tumble in the price of gold came as no surprise to experienced technical traders and to readers of Premium Update. We gave you a heads up to close out your speculative gold positions before the beginning of the correction. Keep in mind that even the strongest bull markets need to pause and correct before moving higher. I’m not even sure that the decline we have seen so far should be labeled a correction.
Now, gold coins from United Nations Now, the United Nations is also lured by the glitter of gold. In a bid to raise money for its projects, United Nations has licensed the minting of gold bullion coins bearing its logo to provide a public option world savings currency. Oro gold coins are hoped to contribute to making the UN better funded by 2015, with revenue rising by ten to 15 per cent.
They buy gold, because they lost faith in banks! All of us thought gold prices are soaring because of the fear among investors that recession will take away all their money. But, the reality is different. People go for gold because they don’t have faith in the central banks. And in the recent past people have realized that the banks are no more the best place to keep your money.
China may overtake India as world's top buyer of bullion It's taken all of recorded history, but this year China finally looks set to overtake India as the world's No 1 gold consumer. It may struggle to hold that position in the short term, as the one-off factors that have slowed India's gold demand fade, but in the long term China's rapidly growing economy and investment demand could see it add gold to the long list of commodities where it is the world's largest buyer.
Keeping the Midas touch Although gold coins and small bars account for a small portion of the precious metal market, analysts see them as a good indicator of investor appetite as both demand and price continue to rise All things for all people, everywhere. Or so says the motto of Harrods, the London department store. Except in jewellery, "all things" until recently did not include gold. But the store, heartened by the current rally in the yellow metal, now sells bullion. "Sales are ahead of our expectations," says Chris Hall, Harrods' head of gold, as he shows a collection that ranges from tiny wafers of 5g, costing about $200 (Dh734), to a central bank-style
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