goldmap

Gaslight - 12/22/12

 

"There is always a well-known solution to every human problem--neat, plausible, and wrong." - H.L. Mencken

 

Dear All,

Mencken's observation is particularly apt in the wake of the collectivist exploitation of the Newtown tragedy as gun-control opportunists seize on the brutal massacre of schoolchildren as justification for more anti-gun legislation.  Slow learners, Americans. 

In a fog of grieving hysteria and media prodding, boobus americanus (a term coined by Mencken as well) is pressuring the political class for the easy, quick fix. Heaven forbid the populace might engage in a national examination of its psyche, lest it reveal the unique depravity that glorifies violence in virtually every aspect of its culture -- short of, say -- an actual slaughter of white schoolchildren. Perhaps it might also pay more attention to this common denominator to school violence. Lanza by the way was taking the anti-psychotic drug, Fanapt,

Boobus'  inability to recognize the futility of attempting to prohibit people from having the things they want and/or feel they need has a long history. Between the passage of the Constitution's 18th amendment in 1919 and its repeal under the 21st amendment 14 years later a large criminal element was borne to service the demand for alcohol. As illustrated here, decades of exponentially rising costs in the prohibition and war on drugs have been similarly futile in curbing U.S. drug use and dependency, yet that inane effort continues having engendered a criminal class to serve that market so large and entrenched that its gargantuan cash flow has now ensnared the U.S. banking system in a liquidity addiction of its own.  With nearly half of all U.S. households possessing at least one firearm, promoting the passage of more laws to control gun ownership belongs in the same fraternity of idiocy which advocates the building of a 3,000 mile border fence to keep out illegal immigrants. Why is it that Americans continue to put their faith in legislators and government to protect them when the black market always has the last word? 

Enter gun-control lynch mobs demanding more legislation which would prove to be at best, a minor inconvenience to members of the psychopathic homicidal community, who it can be safely assumed -- when on the cusp of undertaking a suicidal slaughter mission, do not pause to consider the penalties for possession of illegally obtained firearms. So as the country is sidetracked by political grandstanding (featuring a president who shamelessly kicked off his campaign for this state power grab with an unconvincing display of contrived weeping) you may wish to familiarize yourself with the highly sanitized and clinical manner in which President Obama has executed many more innocent children in Pakistani drone strikes than were murdered by the now deceased Mr. Lanza in Connecticut.

Mainstream media and its consumers are drawn to the gruesome at home and to sex scandals but not the 'collateral' murder of innocents with peculiar sounding names dished out by their president in callous sophisctication via drone video screens. An army general caught with his pants down creates a media frenzy but death delivered to children by drone half a world away is of little interest. Unfortunately you will have to read the details of these attacks in the foreign press as the U.S. media now effectively operates as a state vessel: DER SPIEGEL: The Woes of an American Drone Operator

"Did we just kill a kid?" he asked the man sitting next to him.

"Yeah, I guess that was a kid," the pilot replied.

"Was that a kid?" they wrote into a chat window on the monitor.'

You may also wish to read these thoughtful pieces on your way to recognizing the seemingly counterintuitive reality that the more restrictions that are placed on the gun possession rights of private citizens the more dangerous a country becomes. It is why in every budding authoritarian dictatorship the first order of business is to disarm the citizenry and it is why the content of the U.S. Constitution's second Amendment found its way into that document's Bill of Rights and not subsequent modification. This is not dogma -- it is history. Everywhere and always, whatever entrenches the state' is the enemy of the people:

Business Week: A Post-Newtown Guide to the Gun Control Policy Debate

Gun Control? No, Drone Control

How to Spot a Hypocrite in the Gun Debate and Other Reflections on Newtown

 

The swelling mass that has taken up permanent residence on public payrolls (which occupancy their unions like to refer to as "public service") increasingly resembles those of failed southern European states where the securing of a lifetime government job had come to be thought of as a right.  Bloomberg shines some light on the taxpayer rip-off': $822,000 Worker Shows California Leads U.S. Pay Giveaway

 

Former Assistant Secretary of the US Treasury Paul Craig Roberts has penned another excellent piece -- "The 'Fiscal Cliff' Is A Diversion: The Derivatives Tsunami and the Dollar Bubble"  -- which reinforces the points made here about derivatives, the Fed's real agenda and the relative insignificance of the fiscal cliff.

"Today merely four US banks have derivative exposure equal to 3.3 times world Gross Domestic Product.  When I was a US Treasury official, such a possibility would have been considered beyond science fiction."

 

Just when you thought it couldn't get worse...The upshot here is that Social Security recipients are going to be additionally ripped-off as are other recipients of COLA adjustments (holders of U.S. Treasury TIPS -- be forewarned). President Obama is proposing a new calculus for measuring inflation that is intended to further understate the already drastically understated Consumer Price Index. If gasoline prices increase to a point that you can no longer afford to drive your car -- forcing you to walk instead -- the cost of living is deemed to have dropped under this absurd metric (which is actually already in use under current CPI methodology). Note the article's fabricated comment that "some critics" claim the government overstates inflation.  I'd like names.  It is not remotely possible that anyone could be suggesting such a thing other than a deranged economist.  Never mind, long list.  Obama proposing new inflation measure  

"But some critics say the government is overstating inflation. In reality, when prices rise, consumers turn to alternatives instead of paying more. So for example, if prices rise significantly on beef, they may buy chicken instead."

The man who understands the methodology behind phony government statistics better than anyone, Shadowstats' John Williams was interviewed by Gregg Hunter on the state of the economy and the Fed's role in monetizing anything not nailed down.

HUNTER:       "So if they [Fed] didn't do this $85 billion a month the banking system would collapse?"

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WILLIAMS:     "That's where its heading."

 

As repeated here frequently, drug cartels are the single largest source of bank liquidity other than central banks: NYTimes: HSBC to Pay $1.92 Billion to Settle Charges of Money Laundering. With the U.S. Department of Justice now a wholly owned subsidiary of the banking complex, GATA's Chris Powell provides perspective on the matter of the selective administration of justice and targeted prosecutions: SS boots Liberty Dollars off eBay but no prosecution of HSBC money launderers

 

It has now been a year since President Obama signed into law the authority of U.S. Presidents to indefinitely detain and torture American citizens without charge or trial. Where do Americans stand on this?  They are oblivious. Largely the product of state-run schools, they were indoctrinated to view government as a benevolent force, have no meaningful familiarity with history and are otherwise incapable of broad critical thought -- believing that such dictatorial discretion is acceptable in order to protect the country from terrorists and other bogeymen. So, one year later there is this: Wired: Attorney General Secretly Granted Gov. Ability to Develop and Store Dossiers on Innocent Americans.

 

 

Gold and silver...

A GATA researcher has discovered a 3/10/99 internal IMF document which provides further damning evidence of the surreptitious management of the gold price by and among western central banks and their efforts to obfuscate their methods of doing so. At issue was a proposal that would have increased accounting transparency -- strengthening the reporting standards of member central banks by requiring them to distinguish between actual gold reserves and gold loans and swaps. The memo cited the objections to the sunlight:

"Central bank officials," the confidential report says, "indicated that they considered information on gold loans and swaps to be highly market-sensitive, in view of the limited number of participants in such transactions. Thus, they considered that the Special Data Dissemination Standard reserves template should not require the separate disclosure of such information but should instead treat all monetary gold assets, including gold on loan or subject to swap agreements, as a single data item."

  

The 1944 film, Gaslight engendered the term 'gaslighting' -- defined in UrbanDictionary as "an increasing frequency of systematically withholding factual information from, and/or providing false information to, the victim - having the gradual effect of making them  anxious, confused, and less able to trust their own memory and perception."  The counterintuitive price action of gold and silver since Fed Chairman Bernanke's announcement of QEforever on December 12th has disoriented quite a number of precious metal investors. Counterintuitive price action has actually been a feature of this bull market for as long as I've been in it (14 years). The Update I put out this week linking to Bill Murphy and Chris Powells' interview on RT described the motive and methodology behind the shenanigans. The price action is designed to disorient you. A rising gold price is the enemy of central bankers seeking to maintain economic order. As someone said recently, it's a chess game, not checkers. Understand that, come to expect these price raids, use cash to take advantage of them and you'll be fine. Allow your stomach to do the analysis instead of your head and you'll keep nothing down.

 

Unless the current raid continues and lowers prices further, both gold and silver are about to close higher for the 12th successive year. For the silver and gold stocks, whose gains over this 12 year bull market still exceed those of the metals, their pricing for the last third of the run has stretched the lowest end of the value spectrum. That will inevitably change. Their prices will revert to their mean value ('Twas ever thus) and the spectacular gains will again set your hair on fire.

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Block out the noise. Keep your ear to the tracks. Seek the truth. Be happy.

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Jeff

 

 

 

 

 

 

 

 

 

 

 

UPDATE: GATA on Russia Today - 12/18/12

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Dear All,

 

Appearing on RT's (Russia Today) 'Capital Account' this afternoon, GATA's Bill Murphy and Chris Powell were interviewed by Lauren Lyster. In contrast to the censored drivel served at CNBC, the discussion openly examined the manipulation of the gold and silver price, the nefarious activities of JP Morgan acting as the Fed's agent in doing so, and GATA's discovery of a private 3/10/99 internal IMF document evidencing the conspiracy among western central banks to obfiscate their methods of surpressing the price of gold -- subjects verboten in mainstream media: RT: GATA's Bill Murphy & Chris Powell on Gold and Silver Market Manipulation

 

Russia Today covers the U.S.financial markets in a sophisticated and penetrating manner and with a willingness to go where U.S. media will not.  Bill has been blacklisted from CNBC since his sole appearance there in 1999. RT is becoming the "go-to" broadcaster for honest coverage of the markets. Check out their programming and lineup of guests.  You'll be impressed.

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Sometimes I wonder who won the Cold War.

 

Jeff

Contrived Exits - 12/9/12

 

"We all know what to do, we just don't know how to get re-elected after we have done it." - Jean-Claude Junker, Prime Minister of Luxembourg

 

Dear All,

Prime Minister Junker, quoted above in a moment of candor thus revealed the essential dilemma of economic stewardship under fiat monetary systems. The more government largesse to which the electorate is accustomed, the less tolerant it becomes of threats of its cessation. Private sector profit (and a stable currency) is the mother milk of liberty and higher living standards. Once a threshold is crossed where the majority no longer grasp this, the political dynamic enters a point of no-return.

About that exit strategy...Fed Exit Plan May Be Redrawn as Assets Near $3 Trillion

'There is certainly an issue about unwinding the balance sheet'" in a way that "is effective and continues to support the recovery without creating inflation," St. Louis Fed Bank President James Bullard said in an interview in October. The central bank might have to  “revisit” the 2011 strategy, he added.'

'Unwinding?' Are you kidding me?  The essential truth about the Fed's exit strategy is that there isn't one. If there is indeed a strategy it is for various Fed members to make statements concerning the theoretical timing of withdrawals that will never occur, in order to create the illusion of consideration and prudence, all the while pumping like mad. The banks and financial markets will continue to chew up fresh stimulus and what comes out the other end is inflation. The U.S. central bank cannot withdraw for the same reason it could not fail to inject in the first place. The alternative to injection was and remains total collapse. Inflation is the Fed's exit strategy, which in turn means a significantly lower U.S. standard of living and a much higher gold price. For its stealth attributes inflation is often referred to as "the invisible tax," its sub-rosa nature being the reason for its populariity among politicians and central bankers. The inflation tax is most harmful to those who least understand its source -- the lowest economic classes. Lacking the assets with which to do so they are as well -- the least able to defend against it.

 

It is also true at the five largest U.S. banks; their balance sheets are works of fiction: Deutsche Bank Hid $12 Billion in Losses; misvalued giant derivatives position

 

The New York Fed reported that the percentage of federal student loans 90 days or more delinquent catapulted to a record 11% percent as of Sept 30th, a level which for the first time exceeds credit card delinquencies.  As of July 30th the figure was 8.9% -- a 24% jump in serious delinquencies in only 3 months. The Fed report included this note though (emphasis mine):

“[T]hese delinquency rates for student loans are likely to understate actual delinquency rates because almost half of these loans are currently in deferment, in grace periods or in forbearance and therefor temporarily not in the repayment cycle.”

 

In my prior post I referenced Greece's parliamentary staffers' protestation of non-exclusion from that country's austerity measures. Their reasoning was quite simple -- they're special. Now enter none other than the U.S. Postal union coalition, explaining to Congress that it is only fair that its workers be similarly spared from any fiscal cliff cuts. Their rationale? "[I]t is time our nation’s leaders found other ways to reduce the deficit than continually taking from those who have dedicated their lives to public service.”

From the organized labor machine that speaks for the shuffling, bloated cast of ingrates populating a federal agency that should have been permanently shuttered and privatized sometime during the last century comes precisely the spirit of shared sacrifice one would expect.  Given that public sector jobs (or as the unions prefer --"public service") have been growing faster than those in the private sector -- one might reasonably conclude that the country would be better off with a bit less [cough] 'public service,' --  which is in actuality -- a public screwing.

 

NSA whistleblower William Binney was featured here in a prior post. Russia Today (RT) -- the new gold standard for investigative journalism that has no U.S. peer -- recently conducted a chilling interview with the former NSA operative who explained the essential point that everyone in the US is under virtual surveillance.' 

The NSA'S head is arguably the most powerful man in the western world yet virtually no American has heard of him. For that matter, boobus americanus has likely never heard of the National Security Agency.

 

Nader: War Criminal Obama Worse Than Bush

 

Richard Maybury came as close to predicting the events and timing of the 9/11 attacks as anyone I'm aware. I have previously sung the praises of his indispensible geopolitical journal, 'U.S. & World Early Warning Report.' I became a subscriber in the late '90's and encourage you to as well (I have no affiliation with nor receive any financial compensation from the publication). In the current issue Maybury points to the heightened Japanese/Chinese tensions over disputed Pacific possessions amidst the presence of the U.S.' 7th fleet and Okinawa Marine base:

"Keep an eye on Okinawa. It is the center of the US Military build-up in the East China Sea, much as Cuba was the center of a Soviet buildup in the late 1960's, right before the Cuban Missile Crisis. Do not assume that this time cooler heads will prevail."

 

I probably get more email about climate change than any other subject. I'm hardly a zealot on the issue and have no financial skin in the game (which is something one ought to discern about many of the scientific experts dispensing opinions on the subject). I'm simply not prone to paying attention to the pronouncements of politicians or Hollywood celebrities.  I write on the subject regularly to suggest that you too block out the noise and rely on your intellect when for instance the media bombards you with theories on causality when a severe hurricane hits. To wit, the most recently released hadCRUT data set reveals that  global temperatures have been flat for the past 16 years, negating the statistical significance of the prior 16 year period when temperatures rose (hardcut4 data also shows cooler temperatures for the most recent 5-year period than the prior 5-years period.). This is an inconvenient truth that you have unlikely seen reported anywhere in mainstream media.

"A study led by Bo Christiansen of the Danish Meteorological Institute, concluded: ‘The level of warmth during the peak of the MWP in the second half of the 10th Century, equaled or slightly exceeded the mid-20th Century warming.' There was also a pronounced warming period in Roman times."

 

Really Bob?..Broadcaster Bob Costas delivered a gun-control promo during last Sunday night's NFL game following the suicide of player/murderer Jovan Belcher. The irony of Costas pontificating about gun violence midway through a broadcast of organized savagery; one of the most violent legal endeavors for which men are paid --was no doubt lost on the NFL front man.  Costas lamented the "current gun culture" but not the dysfunctional professional football ethos which includes an NFL team caught running a financial incentive system for its players to cause serious injury to opponents. Bob forgot to mention the League's roster of players -- past and present, with criminal rap sheets statistically comparable to those of the worst inner-cities -- featuring domestic violence, assault, drug possession, DUI and dog-fighting.  There was no lament by Costas either that between 1977 and 2009, 307 football players at the high school through professional level suffered incomplete recoveries from devastating cervical cord injuries. Costas made no reference to  the traumatic head injuries such as the ones that according to a friend of the deceased Mr. Belcher, the player struggled with (along with alcohol and painkillers) and of which the NFL has been brutally dismissive for most of its history (Why not ban automobiles,Bob? -- Intoxicated Dallas Cowboy kills teammate in car crash).

Could it be that the problem is simply this: Jovan Belcher was all-too typical of the low-lifes who have come to populate the criminal cesspool known as the National Football League; a group of largely semi-literate men recruited from the facades of what are supposed to be institutions of higher learning? Where was Bob's outrage at the travesty of those educational institutions functioning as mere semi-pro breeding gounds?  Is it lost on Costas that incrementally, handing college degrees to ignorant men is more culturally damaging than a street thug's existing predisposition toward firearms?  Costas, in effect an unregistered paid lobbyist for the National Football League instead went for the cheap straw issue; the low-hanging politically ripe fruit -- guns. By conveniently attacking the last line of defense by good people against tyranny and homicidal deviants such as Belcher, Costas played NFL pimp, implicitly defending the skewed world where professional athletes are idolized and their whitewashed personal problems further sanitized by sanctimonious broadcasters. Upon completing his sermon Costas enticed: "The second half is next, from Dallas."

The trend...

AustrianTimes: Call to bring Austrian gold back home from the UK  Austria has 80% of its gold (224.4 tonnes) stored in the UK.

Brazil has no gold reserves, just claims against bullion banks, Goldcore discloses  Counterparty risk among sovereigns is apparantly not a concern at the central bankers club.

WSJ: China Moves Forward in Opening Gold Market

Reuters: South Korea central bank bought 14 tonnes of gold in Nov

Pension Benefit Guaranty Corp. running $34 billion deficit

 

Gold and silver...

This call by Goldman Sachs should make your contrarian heart sing. If you've acted upon their prior such calls you're considerably poorer for it: IT'S OVER: Goldman Calls The End Of The Great Gold Bull Market

I would not recommend forgetting the metal but this Wall Street Journal article is spot-on with respect to the relative valuation of equities: In Gold Investing, Forget the Metal and Focus on Stocks

"To put it simply: the price of an ounce of gold today would buy more stock in gold-mining companies than at any point in a quarter century."

In spite of gold and silver's performance this year sentiment continues to be lousy, particularly in the gold/silver stocks. A number acquaintances simply couldn't take it and have bailed out. Personally it saddens me but as an investor I know that arithmetically only a small minority can thrive, and that the less crowded the boat, the sooner and bigger the payoff.

All the best,

Jeff