Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.

Thursday 05.27.2010

Gold Hits 1-Week High on "Massive Flows", Scramble for "Too Few Safe Assets" By: Adrian Ash - GoldSeek.com
THE PRICE OF GOLD in wholesale dealing rose throughout Asian and London trade on Wednesday, touching 1-week highs above $1215 an ounce as world stock markets bounced from their recent plunge. Crude oil also rallied, regaining $70 per barrel. Silver prices caught up with gold, rising 3.3% from last week's finish to $18.68 an ounce. "Support [in gold] still at the April high, continues to limit the downside," reckons Phil Smith in his Reuters Market Technical Analysis from Beijing, noting the sharp rally in gold from last Friday's drop to $1178. Exchange-traded gold trusts are seeing "massive inflows given the current economic climate," says one London dealer.

Strong demand to lift gold above $1,500
Muzaffar Rizvi - KaleejTimes.com
DUBAI - Gold prices will maintain rising trend and may cross $1,500 an ounce by the end of this year on strong demand in China and India, industry players said on Wednesday. They said demand for gold would remain strong this year due to investors' appetite for the yellow metal in the wake of worldwide economic instability, sovereign risk and the threat of a 'double dip' recession. "Pure Gold sees gold prices as high at the moment, but it will go further higher by the year-end. I expect gold prices to go above $1,500 by the end of the year," Firoz Merchant, Chairman of Pure Gold Jewellers, told Khaleej Times. He said high gold prices are an opportunity for customers to continue to increase their confidence in buying gold as an investment and therefore this trend will continue.

US Debt and the Gold Price: Numbers On the Up and Up
By Addison Wiggin - The DailyReckoning.com
05/26/10 Baltimore, Maryland - As we sat down to write this morning, the cell phone began vibrating against the desk. Alice Gomstyn from ABCNews.com wanted to know what we thought about the national debt crossing the $13 trillion threshold.
UhÉthe same as we thought about it crossing $12 trillion less than six months ago. Not good. But what do we know. We've been whistling Dixie on this subject for the better part of our adult lifetime. No one really cares except when these psychological boundaries are crossed tomorrow it'll be business as usual.

Has Gold Become A New Reserve Currency?
For decades, the U.S. dollar has been the reserve currency of the world. This has given the United States an extraordinary amount of economic power, but as the U.S. economy has started to come apart over the past decade, other nations have increasingly sought to move away from the U.S. dollar and find other alternatives. For a long time it was thought that the Euro would become the next great reserve currency of the world. However, the recent Greek debt crisis, along with massive financial instability in nations such as Portugal, Spain and Italy, has caused investors to rapidly lose confidence in the Euro. In fact there are even some whispers that the Euro may not even survive the sovereign debt crisis as it sweeps across Europe. With both the U.S. dollar and the Euro looking shaky, investors have been searching somewhere safe to put their money. Increasingly, they have been turning to gold. So has gold now become a new reserve currency? Will all of this new demand drive the price of gold into unprecedented territory?

Asia's demand for gold soars
Angela Shah - TheNational.ae
Demand for gold in India soared almost sevenfold in the first quarter of the year as investors rushed to the metal as a haven from growing economic and market troubles around the world, the World Gold Council (WGC) said. Consumers in India and China, who have long been heavy investors in the metal, have grown accustomed to soaring prices, the organisation said, leading them to invest even as gold hit new highs. In the first three months of the year, demand for gold in India soared 698 per cent to 193.5 tonnes compared with the same period last year, while Chinese demand rose 11 per cent to 105.2 tonnes.

A little bit of gold could do you a lot of good
Ram N Sahgal, ET Bureau - IndiaTimes.com
MUMBAI: Gold prices in the local bullion market may be vaulting, but traders and analysts say that it should still be a part of the portfolio of retail investors, considering the natural hedge it provides and the returns on investment year to date.
Over a one-year period, gold priced in rupees has yielded a return of 6.7% against a negative 11.3% return by the Sensex, highlighting its status as an alternate asset class during times of uncertainty. Amid high volatility in stocks, gold priced in rupees rose to a record high of 18,846 per 10 gram on Wednesday, mainly on account of a weaker currency and fears that the Eurozone crisis may worsen.

Gold Correction Factors, Hidden Dollar Swap Hammer
By: Jim Willie CB - MarketOracle.co.uk
Let me start the article with a personal note. For the last six years, my pen has put forth a public article almost every week. Since the end of 2009, a change has come from that pattern, for four reasons. First, articles take time and serve as free volleys sent into cyberspace. They are attempts to raise awareness of a broken corrupt system, to encourage increased investment protection by the investment community, and to make repetitive messages that can sink in. Second, many of the warnings have come true of a monetary system in tatters, an insolvent banking system, a failed central bank franchise system, and a discredited amalgam of sovereign bond markets.

Speculators rush for gold as rally of 27% is predicted
NICHOLAS LARKIN AND CLAUDIA CARPENTER - BusinessDay.co.za
SPECULATORS are buying gold faster than the world's biggest producers can mine it, as analysts forecast a 27% rally that may extend the longest run of annual gains since at least 1920. Exchange-traded products backed by bullion added 41,7 tons in the week to May 14, the most in 14 months, data from UBS show. China, Australia and the 15 other countries that are the world's largest miners averaged weekly output of 41,6 tons last year, researcher GFMS estimates. Even though prices have fallen 4,6% to 1191,65 from a record 1249,40/oz since May 14, the median in a Bloomberg survey of 23 traders, analysts and investors shows it will reach 1500 by the end of the year. Gold futures for June delivery fell 3,30 to 1190,70 in New York yesterday. The metal gained 1,5% yesterday, after shedding 4,2% last week.

Seven reasons gold rally will continue
Jeff Nichols - Commodity Online
A few months ago most analysts were skeptical about $1500 an ounce for gold by end of 2010, however, the recent rally in gold coupled with economic uncertainties have forced those who earlier disputed the bullish forecasts to jump on the bandwagon, according to Jeffrey Nichols, Senior Economic Advisor to Rosland Capital and Managing Director of American Precious Metals Advisors
US inflationary policies: The US monetary and fiscal policies are inflation. Official federal debt, now around $12.8 trillion is only a small part of Washington's actual obligations.Off-budget and unfunded future liabilities are another $108 trillio, Jeff Nicols said. So the end result would be higher inflation, currency depreciation and higher gold prices.

Gold moves up on geopolitical tensions
SINGAPORE (Commodity Online) : Gold prices advanced in Asian trade Wednesday despite a firming dollar as geopolitical tensions in the Korean peninsula boosted its appeal. Gold for immediate delivery was seen trading at $1204.94 an ounce at 12.00 noon Singapore time while US gold futures for June delivery was at $1205.44 an ounce eat the same time on the COMEX division of the New York Mercantile Exchange. The euro fell on Wednesday, slipping back towards a four-year low against the dollar on euro zone fears.

Better touch screens with silver, gold nanowires
By siliconindia news bureau
Washington: Scientists from Stanford University has come up with plastic touch screen coated with silver and gold nanowires, which has more flexibility and durability than the glass touch screen, according to ANI. "Touch screen made from thin plastic coated with silver and gold could be produced more quickly than glass plates-up to 100 times faster," Discovery News quoted Yu Cui, Scientist at Stanford University and co-author of the paper, as saying.

China, India battle for gold market supremacy
By Daniel Wilson
Is gold demand in China slowing down compared to India? India and China are the world's two largest gold consuming nations. China's growing gold market has remained the most-talked about commodity news in recent times as several analysts and Chinese officials have been talking big about the dragon country's plans to step up gold reserves. The Chinese bullion market has been, of course, growing exponentially well, as the country was projected to overtake India in gold consumption.
But can China easily overtake India in gold demand and consumption. It looks, despite the hype, it is not going to be easy for China to outshine India's vibrant, ever-growing and rich gold market. Proof of it is the latest Gold Demand Trends report from the apex global gold body--World Gold Council--that has been published this week.

Peter Schiff: Glenn Beck Doesn't Know That
GOLDLINE Is Ripping People Off!

Warning: Crash dead ahead. Sell. Get liquid. Now.
Paul B. Farrell - SilverBearCafe.com
'Game's in the refrigerator.' Power's turning off. Dow sinking below 6,470
"This game's in the refrigerator! The door's closed, the lights are out, the eggs are cooling, the butter's getting hard and the Jell-O is jiggling ..."
That was legendary Lakers' radio announcer Chick Hearn's signature way of calling a game early, telling fans the home team won ... you can head for the exits before the final buzzer. Chick wrote the book with popular sports phrases like "slam dunk," "air ball," "charity stripe," and a "bunny hop in the pea patch" for a traveling violation.

Don't Doubt Bernanke's Ability to Create Inflation
National Inflation Association
With the Dow Jones now down 11% nominally from its high last month, NIA has been getting hundreds of emails and phone calls asking if there is any way we could be wrong about the threat of hyperinflation in the U.S. and if indeed deflation is the real problem we need to be worried about. The names Nouriel Roubini, Robert Prechter, and Harry Dent get mentioned to us a lot, with many NIA members asking why these so-called "experts" believe deflation is in our future.

Obama's Economic Advisor Lawrence Summers Argues for a Second Stimulus By JONATHAN BERR - DailyFinance.com
Lawrence Summers, Director of the White House's National Economic Council, will bring his case for the "son of the stimulus" to the National Constitution Center in Philadelphia Thursday evening. The question is whether members of Congress worried about the critical midterm Congressional elections will have to stomach for the $200 billion spending plan Summers advocates.

Are We About To Witness The Greatest Banking Consolidation In U.S. History?
The Economic Collapse Blog
As the number of bank failures in the United States continues to accelerate, many analysts are warning that we could soon see unprecedented changes in the U.S. banking industry. In fact, there are some economists that are warning that we could be about to witness the greatest banking consolidation in U.S. history. As dozens of small and medium size banks have failed, the megabanks have systematically been gobbling up larger and larger slices of market share. In fact, if current trends continue, it doesn't take much imagination to foresee a future where the entire U.S. banking industry has been consolidated down to between 5 and 10 "superbanks". So would that be so bad? Well, yes it would. It would represent a massive shift in financial power away from the American people to big, global corporate banks. But if you happen to be a fan of big, global corporate banks perhaps you will really love what is about to happen to the U.S. banking industry.

In a Word, the Problem is "Debt"
by Tim Iaconco
Recent developments in the euro zone that increasingly look like they will lead to the restructuring (if not the collapse) of one of the world's major currencies and the potential for this "contagion" to move first north to the U.K. and then west to the U.S. have many people wondering what's gone wrong with the global monetary system.
How could advanced Western economies have run into such trouble?
With trillions of dollars in debt now transferred from public private sector balance sheets onto those of governments (where very different rules apply), could the problems seen in mainland Europe today spread to the British Isles and then to the U.S. where fiscal and economic conditions are, arguably, even worse?

TARP Investments Lead to Huge Losses for U.S. Treasury
By PALLAVI GOGOI - DailyFinance.com
As struggling banks get acquired or fail, the U.S. Treasury is shouldering a growing burden: Its investments in TARP are turning out to be a bust, leading to huge losses. And there are signs of more trouble ahead. Example: When Canada's Toronto Dominion Bank (TD) bought a South Carolina bank earlier this month, it came with a hefty price tag for the U.S. Treasury Department -- a 60% loss in its TARP investment. Turns out, this is only one among several hits that the Treasury and the U.S. taxpayer have taken recently. In fact the string of losses in TARP, the Troubled Asset Relief Program, isn't only large, it's gathering momentum.

Moody's Reiterates U.S. Spending Risks Credit Rating
By Mary Childs
May 25 (Bloomberg) -- The U.S. government's Aaa bond rating will come under pressure in the future unless additional measures are taken to reduce projected record budget deficits, according to Moody's Investors Service Inc. The U.S. retains its top rating for now because of a "high degree of economic and institutional strength," the New York- based ratings company said in a statement today that was little changed from a credit opinion released in February. The outlook is stable, the statement said.

Bond Distress Highest Since '09 as Sales Vanish
By Bryan Keogh and Kate Haywood
May 26 (Bloomberg) -- The percentage of corporate bonds considered in distress surged this week to the highest since 2009 as investors dumped debt of the neediest borrowers on concern that Europe's fiscal crisis may make it harder for them to refinance.
Some 17 percent of junk bonds yield at least 10 percentage points more than Treasuries, up from 9.2 percent last month, Bank of America Merrill Lynch's Global High-Yield Index shows. The jump is the biggest since the distress ratio rose 11 percentage points in November 2008, two months after Lehman Brothers Holdings Inc. collapsed. Bonds of MGM Mirage and Freescale Semiconductor Inc. joined the list in May.

Lehman sues JPMorgan over its collapse
By David Ellis - CNNMoney.com
NEW YORK (CNNMoney.com) -- Lehman Brothers' bankruptcy estate filed suit against JPMorgan Chase Wednesday, alleging that the bank demanded billions of dollars more than it needed in the firm's final days contributing to Lehman's ultimate demise. The suit, filed in the U.S. Bankruptcy Court in the Southern District of New York, contends that Lehman, which was scrambling to stay afloat, invited JP Morgan to assist it in securing emergency financing.

Gerald Celente - Clash of the Economists
on abc6.com May 21, 2010

UK and France reject EU bank plan
By George Parker in London and Nikki Tait in Brussels - FT.com
Britain and France were at odds with other European Union countries on Wednesday over plans to insure against future bank failures, in another sign of the problems in trying to forge a common response to the bloc's economic woes. Michel Barnier, EU internal market commissioner, set out plans for member states to form national funds to help wind up or reorganise failing banks, funded by a levy on the financial sector.

Spain Takes the Spotlight From Greece in Europe's Debt Crisis
By CHARLES WALLACE - DailyFinance.com
First came Greece, which threatened Europe's economy with its staggering 130% debt-to-GDP ratio. Now comes Spain, which also seems to be contributing to the debt crisis in Europe. Unlike Greece, Spain has a low debt-to-GDP ratio. The country's problem is its banks' large real estate debt, fears about Spain's economy, and the fact that its sovereign debt is largely financed abroad. If foreign investors walk away from Spanish bonds, it could cause a sovereign debt crisis for Madrid that could spread to the rest of Europe.

The European Debt Crisis: A Smoke Screen For Bigger Problems
By PETER COHAN - DailyFinance.com
The European Union agreed to a 750 billion euro bailout plan in May to restore confidence in its economic structure. In light of the ongoing instability in global financial markets, that plan doesn't seem to have worked. But a look at how much money the three most-often-cited EU basket cases owe, suggests that the global market sell off must be a response to a different set of problems. Meanwhile, no additional bailouts are needed for now.

Greece tries to renegotiate pensions with EU/IMF
Reuters - ForexYard.com
ATHENS, May 26 (Reuters) - Greece is trying to renegotiate the terms of a drastic pension reform required under the terms of an economic rescue deal agreed this month with the EU and the IMF, senior government officials said.
In the first sign of glitches over the 3-year bailout plan, officials said they wanted the EU and IMF to agree full pensions should be payable after 37 years of contributions instead of 40, as set out in the deal, and allow the reform to be implemented later than foreseen.
"The (EU/IMF) memorandum will be implemented but I want to have the option to negotiate to the end," Labour Minister Andreas Loverdos said in a television interview. "I'm fighting for this, I'm not saying I will win."

Brussels unveils framework for bank levy
By Nikki Tait in Brussels - FT.com
European taxpayers should not have to bear the costs of rescuing ailing banks, a top European Union official said on Wednesday as Brussels formally unveiled its proposal for EU countries to form national funds to insure against future bank failures. The plan, which would be financed by levies on the banking industry, would aim to ensure that future bank failures do not destabilise the financial system. "It is not acceptable that taxpayers should continue to bear the heavy cost of rescuing the banking sector - they should not be in the front line," said Michel Barnier, EU internal market commissioner in Brussels.

What Barack Obama Is Thinking
By Peter Ferrara - American Spectator
tudents of history will recognize the method to President Obama's madness. The parallels in both policy and politics to the Roosevelt Administration are too striking not to be deliberate. President Obama is consciously modeling his Administration on the Roosevelt Administration. But just as the liberals of the 1930s graduated to the New Left of the 1960s, President Obama's policies and politics transcend the liberalism of the 1930s. He is building what Newt Gingrich rightly calls a secular socialist machine in his new book To Save America.

White House Admits BP Disaster Worst Oil Spill in US History
By: Andre Damon - MarketOracle.co.uk
After downplaying for weeks the significance of the Gulf Coast oil spill, the White House admitted on Monday that the Deepwater Horizon disaster constitutes the worst oil spill in US history. The admission from the White House comes as the Obama administration continues to insist that the response to the oil spill remain in the hands of BP.
"I don't think there is any doubt, unfortunately," Carol Browner, director of the White House Office of Energy and Climate Change Policy, said Monday on CBS' "The Early Show." Some scientists estimate that the spill has already released 2.5 million barrels of oil into the Gulf of Mexico, ten times more than that released by the Exxon Valdez in 1989.

Obama's oily Katrina
WashingtonTimes.com
This administration is not so slick after all
Back in 2007, then-Sen. Barack Obama critiqued the Bush administration's response to Hurricane Katrina. "There is not a sense of urgency out of this White House and this administration," he declared, two years after the disaster struck. Now, more than a month since the Deepwater Horizon oil rig exploded and sank, with a massive oil spill making landfall on the Gulf coast, Louisiana's Gov. Bobby Jindal is the one calling for "more urgency." The only rush in Washington is over where to shift the blame.
Mr. Obama apparently never had a plan for responding to this disaster. The White House seemingly felt that if the administration didn't treat it as a crisis, it would go away. If fingers were to be pointed, they could direct them at BP. That political strategy worked well for a week or so. But BP has failed to come to grips with the spill, and the White House, lacking ready solutions, looks feeble and rudderless.

Transocean argued with BP before blast
By Steve Gelsi
NEW YORK (MarketWatch) -- Transocean supervisors that were aboard the Deepwater Horizion rig told government officials Wednesday about a disagreement with BP officials hours before the blast on Aprl 20 that killed 11 and resulted in the current oil leak in the Gulf of Mexico. In a joint hearing held by the U.S. Coast Guard and the Minerals Management Service in Louisiana, Douglas Brown, Transocean's chief mechanic on the rig, said that key representatives from both companies had a heated argument in an 11 a.m. meeting on that day, according to a report by The Wall Street Journal. Brown said Transocean's crew leaders objected to a decision by BP on how to start removing heavy drilling fluid and replace it with lighter sea water from a riser pipe connected to the well head. BP declined to comment on the testimony.

BP Used Riskier Method to Seal Oil Well Before Blast
By IAN URBINA - NYTimes.com
WASHINGTON - Several days before the explosion on the Deepwater Horizon oil rig, BP officials chose, partly for financial reasons, to use a type of casing for the well that the company knew was the riskier of two options, according to a BP document. The concern with the method BP chose, the document said, was that if the cement around the casing pipe did not seal properly, gases could leak all the way to the wellhead, where only a single seal would serve as a barrier. Using a different type of casing would have provided two barriers, according to the document, which was provided to The New York Times by a Congressional investigator.

BP Begins 'Top Kill' to Plug Leaking Gulf Oil Well
By Jim Polson
May 26 (Bloomberg) -- BP Plc began its most ambitious attempt to plug a leaking well that has been spewing oil into the Gulf of Mexico for more than a month. BP began pumping mud-like drilling fluid into the well at 2 p.m. New York time, according to a statement. The effort is aimed at tamping down the gusher of oil and natural gas and then sealing the well with cement. Success would bring to an end a leak that has poured millions of gallons of oil into the Gulf and soiled at least 70 miles (113 kilometers) of coastline.

BP says effort to plug well 'proceeding as planned,' but success still uncertain
By Joel Achenbach - Washington Post
The "top kill" is underway, success uncertain. BP engineers are pumping mud at a furious rate into the damaged blowout preventer that sits on the uncapped well at the bottom of the Gulf of Mexico. The hazardous-but-high-reward maneuver comes five weeks into the oil spill crisis amid an intensifying atmosphere of political recrimination that has spread from the Gulf Coast to the White House and Congress.

The Top Kill
Written by The Oil Drum - OilPrice.com
A Detailed Guide of BP's plan to Stop the Oil Spill:
The next attempt to shut off the flow from the leaking BP well in the Gulf is still aimed to occur early Wednesday. The attempt will use the "top kill" method to try and kill the well. While I have described this in earlier posts, the Unified Command have put out a video animation of the process, and there was an earlier diagram. So I am going to use these, which are simplified explanations, with some additional comments and tie it in to more facts that came out of briefings today, to try and give a more detailed explanation.

Top Kill Animation

Gulf oil spill
Results of 'top kill' operation won't be known for 24 hours
LATimes.com
It will be at least 24 hours before BP officials will know whether their high-risk effort to plug the wellhead spewing crude into the gulf has succeeded, the Chief Executive Tony Hayward said Wednesday afternoon. He said the effort is proceeding as planned and cautioned that the televised images of the oil plume do not give an indication of how the operation is going or whether the oil flow is increasing or decreasing. Engineers worked through Tuesday night to prepare for the "top kill" procedure, running diagnostic and other tests to ensure that conditions were right. The effort involves injecting dense drilling mud into the blown-out wellhead and then sealing it with cement.

Following BP's Lead
Bob Herbert - SilverBearCafe.com
I asked the sheriff of St. Bernard Parish, Jack Stephens, if he was at all optimistic about BP stopping the gusher of oil that is fouling the Gulf of Mexico in time to prevent a long-term environmental catastrophe in the southern Louisiana wetlands.
The sun was high in the sky, and the day was hot. The sheriff was in a small boat, patrolling the waterways that wend their way through the delicate marshes. He thought for a long moment. Oil was already seeping into the marshes, getting into the soil and plant life and coating some of the wildlife. "I'll tell you the truth," said Mr. Stephens. "It may already be too late."

Researchers race to produce 3D models of BP oil spill
By Patrick Thibodeau - The Economic Collapse
NSF approves supercomputing time as researchers apply storm surge models to oil spread
Computerworld - As the oil from BP's massive spill affects an ever expanding area, scientists have embarked on a crash effort to use one the world's largest supercomputers to forecast, in 3D, how BP's massive Gulf of Mexico oil spill will affect coastal areas.
The National Science Foundation late last week made an emergency allocation of 1 million compute hours - acting within 24 hours of receiving the request - on a supercomputer used at the Texas Advanced Computing Center at the University of Texas to study how the spreading oil from BP's gusher will affect coastlines.

Why Are So Many Horrible Things Happening To America All Of A Sudden?
The End of the American Dream - SilverBearCafe.com
Once upon a time the United States was a land of abundance and prosperity that was truly blessed from sea to shining sea. Tens of millions of Americans enjoyed living the American Dream in a land filled with happy, healthy and prosperous people. But these days it seems as though there are new stories of tragedy and despair almost daily. Whether it is the massive oil spill in the Gulf of Mexico, or the horrific flooding in Tennessee, or the tornadoes ripping through the Midwest, or the gut-wrenching economic despair in cities like Detroit, it just seems like a whole lot of horrible things are happening to America all at once. So why is all of this hitting the U.S. right now? Why does it seem like there is just about nowhere in the United States right now that is untouched by a major crisis?

Long-Term Unemployed May Be Out of Luck on Benefits
By DAVID SCHEPP - DailyFinance.com
The nation's lawmakers this week are debating whether to further extend benefits to long-term unemployed Americans. And much like any legislation being muscled through Congress these days, the divisions over the bill's contents fall along ideological lines. More liberal members want to bolster the nation's safety net and establish jobs programs, while conservatives fret about adding a projected $123 billion to the nation's ever-growing debt.

The Hard Truth About Residential Real Estate
Written by Mad Hedge Fund Trader - OilPrice.com
Anyone who believes that housing is on the rebound, and that now is the time to buy, should take a very hard look at the numbers I dredged up for my spring lecture and luncheon tour.
There are 140 million personal residences in the US. Today, there are 26 million homes either directly or indirectly for sale. According to a survey by Zillow.com, a real estate appraisal website, 20 million homeowners plan to sell on any improvement in prices.

Robert Shiller on Housing Double-Dips
by Tim Iacono
This morning's S&P Case-Shiller Home Price Index came in about where most housing "realists" thought it might and that group apparently includes one of its creators, Yale economist Robert Shiller, who had a few comments about the latest data.
The housing slump isn't over.
Tax credits and historically low mortgage rates have failed to lift home prices so far this year. Prices fell 0.5 percent in March from February, according to the Standard & Poor's/Case-Shiller 20-city index released Tuesday.
That marks six straight months of declines - a sign that the housing market is going in reverse. "It looks a little like a double-dip already" economist Robert Shiller said in an interview. "There is a very real possibility of some more decline."

The Other Foreclosure Menace
Fred Schulte, Ben Protess and Lagan Sebert - HuffingtonPost.com
One raw day in early February, Vicki Valentine stood by helplessly as real estate investors snatched her West Baltimore home over what began with an unpaid city water bill of $362.
As snow threatened to fall, she watched a work crew hired by the new owners punch out the lock on her front door. A sheriff's deputy was on the scene while Valentine and her teenage son piled whatever they could into a borrowed car.
Running out of time, Valentine scrambled to pack up clothing and mementos. The home had been her family's for nearly three decades, and her father had paid off the mortgage in 1984. "It's hard to say goodbye to this house," she said. "It's like someone forcing you out of something that belongs to you. I don't get it."

Tapped Out: When Water Bills Force Foreclosure

New $3bn Foreclosure Prevention Program Added to Wall Street Reform Bill
by JON PRIOR - HousingWire.com
The Senate passed the Restoring American Financial Stability Act last week, approving a new program that would reduce mortgage payments for the unemployed.
The program would provide $3bn from the Troubled Asset Relief Program (TARP) to lend up to $50,000 to unemployed homeowners, who could reasonably resume making payments again within two years. The program was modeled after the Homeowners' Emergency Mortgage Assistance Program (HEMAP) in Pennsylvania.
The Senate passed the bill last week but transplanted its own language into the one passed by the House of Representatives. The status of the reform is still "resolving differences." But, lawmakers hope to have it in front of President Obama to sign by the July 4, 2010 recess.

Democratic House Leader Says America is Already Rationing Health Care By Matt Cover, Staff Writer - CNSNews.com
(CNSNews.com) -- House Majority Leader Rep. Steny Hoyer (D-Md.) said the man nominated to run Medicare and Medicaid Services, Dr. Donald Berwick, is qualified to oversee the two massive government health care programs despite Berwick's claim that the government must ration health care. Hoyer added that health care rationing already is happening in America.
At his Tuesday briefing for reporters, CNSNews.com asked Rep. Hoyer, "Donald Berwick -- who's the administration's nominee to run Medicare and Medicaid -- said in a 2009 interview that 'the decision is not whether or not we will ration care -- but the decision is whether we will ration with our eyes open.' Rationing is something the Democrats were accused of wanting to do during the health care debate. I know you don't have a vote on his nomination but do you support his nomination? Do you think that he's qualified to run CMS?" (CMS is the acronym for the federal government's Center for Medicare and Medicaid Services.)

ObamaCare Is Unconstitutional * Judge Andrew Napolitano *

Is Arizona's Immigration Law Being Put on ICE?
By Aaron Goldstein - American Spectator
For all the histrionics, hoopla and hysteria that has surrounded Arizona's recently passed immigration enforcement law, it must be noted that its success depends on the co-operation of the federal government and the feds know it.
How else to explain the words of John Morton, Assistant Secretary of State for Homeland Security for U.S. Immigration and Customs Enforcement (ICE)? Last week, Morton told the Chicago Tribune, "I don't think the Arizona law, or laws like it, are the solution." Morton added that he wasn't of the opinion that the Arizona law represented "good government." So it would appear the federal government will not co-operate with Arizona's efforts to stem the tide of illegal immigration. For all intents and purposes, Morton has put Arizona's immigration law on ICE.

DOJ Lawyers Draft Challenge to AZ Law
by: Mike Levine - FOXNews.com
A team of Justice Department attorneys reviewing the new immigration law in Arizona has recommended that the U.S. government challenge the state law in federal court, but the recommendation faces an uncertain future and tough scrutiny from others in the Justice Department, sources with knowledge of the process tell Fox News.
Staff attorneys within the Justice Department recently sent higher-ups the recommendation. At the same time, the Justice Department's Civil Division, which oversees the majority of immigration enforcement issues for the department, has drafted a "civil complaint" that would be filed in federal court in Arizona, sources said.

Obama Should Visit U.S.-Mexico Border to See the Threat to Americans Firsthand, Republican Senators Say
By Susan Jones, Senior Editor - CNSNews.com
(CNSNews.com) - On the same day President Barack Obama announced he was ordering 1,200 National Guard troops to the U.S.-Mexico border, two Republican senators from Arizona said it's about time - and it's too few troops. "We have been calling on President Obama to deploy National Guard troops to the border since March 2009 and are pleased he has finally started to recognize the essential needs of our Southwest states," Sens. John McCain and Jon Kyl said in a statement. Obama acted before Republicans could force a congressional vote on sending in the National Guard, the Associated Press reported.

Adding insult to injury at Ground Zero
NYC Community Board OKs Ground Zero Mosque Plans
Associated Press - FOXNews.com
After hours of contentious public comment, a New York City community board voted late Tuesday to support a plan to build a mosque and cultural center near ground zero.
NEW YORK (AP) - After hours of contentious public comment, a New York City community board voted late Tuesday to support a plan to build a mosque and cultural center near ground zero. "It's a seed of peace," board member Rob Townley said. "We believe that this is significant step in the Muslim community to counteract the hate and fanaticism in the minority of the community."

China May Shield North Korea as Lee, U.S. Seek Action on Ship
By Bloomberg News
May 27 (Bloomberg) -- Chinese Premier Wen Jiabao is likely to resist pressure to acknowledge that North Korea torpedoed a South Korean warship when he flies to Seoul tomorrow to meet South Korean President Lee Myung Bak and Japan's Yukio Hatoyama. China hasn't followed South Korea, Japan and the U.S. in blaming North Korea for the March 26 sinking of the Cheonan, which killed 46 sailors. Vice Foreign Minister Zhang Zhijun yesterday repeated a call for "restraint" by both sides and said China had no "firsthand information" on the sinking.

Is North Korea on the Verge of Collapse?
Written by Bonnie Glaser - OilPrice.com
Despite the posturing of his regime, there are signs that Kim Jong-Il's hold on North Korea may be slipping and international community must be ready. North Korean leader Kim Jong-il is considered an international pariah in most nations, but he was welcomed with open arms in China May 3-7. The visit underscored North Korea's isolation: Kim's last foreign visit in 2006 was also to China.

Russia's War Games Preparing for Conflict with the East
Written by Simon Saradzhyan - OilPrice.com
Next month will see the Russian armed forces stage an operational-strategic exercise dubbed "Vostok-2010" (East-2010), called "the main event of the combat training" in 2010 in a press release by the Russian Defense Ministry. Thousands of soldiers from the army, including the CBRN Protection Forces, the navy, air force, airborne troops and other elements of the Russian armed forces will participate in the joint exercise of the Far Eastern and Siberian Military districts in mid-June.

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