There is no Exit Plan

Europe is on the verge of collapse. The US is still regarded as the safe haven but despite years of zero interest rate policy and a massively expanded Federal Reserve balance sheet the economy is again on the verge of disaster. Yet the only solutions being discussed are more easing and stimulus.

Regardless of the results, monetary expansion remains the only tool in the central-bank tool kit. Global markets have not revisited the type of chaos experienced after the Lehman Brothers failure, but that’s simply because the problems have been avoided and pushed into the future. In America the federal debt is expanding as rapidly as the Fed balance sheet. And while government and central bank officials constantly remind the public about the disaster that was avoided, they rarely mention how these short-term solutions will eventually be unwound.

These are mainly Treasury and mortgage securities. These are both interest rate sensitive assets. Their value moves inversely to interest rates, meaning that as rates go down they become more valuable. Of course the problem is that as interest rates rise they lose value. The Fed claims that as conditions improve it will begin unwinding this book of securities. But in this environment, interest rates will be rising, which means that the Fed is going to be selling assets that are losing value.

           ................... Chris Marcus

Richard Russell - Gold, Stocks  

With continued uncertainty in global markets, the Godfather of newsletter writers, Richard Russell, wrote, “...we see the stock market up on Fed-created stilts ... I'm stating that deflationary and deleveraging forces are still in command, and all the Fed's manipulations are, and will, fail to turn the bear market into a new bull market.”

“Most of my subscribers are interested in gold. All I'm going to say about gold is wrapped up in the chart below. Here we see gold in a large rectangle formation. The 1550 level has been tested numerous times and it has shown to be solid support.”


“Now gold has its choice of breaking out on the upside of the rectangle or on the downside ... It's obvious that there are buyers at 1550 or below, and that there are sellers near the 1800 area. All of which has given us a trading range of almost one year.

It's always educational to view the stock market as a ‘big picture.’ For that I'll include the Wilshire 5,000, below. The Wilshire includes almost all stocks traded on the NASDAQ, the Amex and the NYSE. I ran a horizontal line on the chart starting from the May 2011 Peak. Note that the Wilshire is below the 2011 peak now. Thus, since May, 2011, the mass of US stocks are actually down. And so are most portfolios.

Right now, US stocks are at a standstill -- caught between two opposing forces. The positive force is the hope of additional Fed stimulative action. The negative force is the primary trend of deflation and over-production.
..........................  Richard  Russell 

Eurozone Banks Dump Bad Paper on Taxpayers

Bloomberg is reporting on what looks like a brazen con being pulled on taxpayers by eurozone banks and governments. It goes like this: During the recent credit bubble the PIIGS country banks created and then sold a bunch of low-quality mortgage bonds. Now they’re buying them up at big discounts to the original price, booking a profit on the trade, and using those securities as collateral for low-interest-rate loans from the European Central Bank.

Stripped of all the terminology, this scam comes down to European governments investing taxpayer funds in risky mortgage bonds — in order to prop up banks that made a lot of ill-considered loans in order to generate big year-end bonuses. This may be legal, strictly speaking, but it’s definitely not moral, and to the extent...

It’s also interesting that the banks admit that they have no other source of cash. The markets at long last appear to have recognized that most big European (and American for that matter) banks are stuffed so full of bad paper and on the hook for so many billions in derivatives that they’re terrible bets. Now only governments with docile citizens are left to keep the zombie banks animated.

This game, like many others in today’s global financial system, can go on as long as the currencies the central banks are creating remain viable. Once euros and/or dollars lose their attractiveness as a store of value, the end will come quickly.


................. By John Rubino

FSN Foreign Correspondent Erik Townsend On The Facts Behind the PFGBest Bankruptcy
Also, The Lifetime Income Series: How to Create Your Own Guaranteed Pension
 In a special segment this weekend, FSN Foreign Correspondent Erik Townsend joins Jim to discuss the sudden demise of commodities broker PFGBest, and look at the facts behind the bankruptcy. In Jim’s Lifetime Income Series, he looks at how to create your own guaranteed pension plan.

James J Puplava CFP with Erik Townsend

                               ................ FinancialSense.Com

The Game is Rigged

The criminal bankers are starting to turn on each other. We now know for certain that the Federal Reserve, the Bank of England and other Central Bankers have criminally manipulated the interest rate markets in collusion with the biggest banks in the world. They have kept up a united front for years, but the facade is starting to crumble. Fingers are being pointed. Accusations are being made. The banking cabal is scrambling. They will have their MSM minions begin the obfuscation and misinformation campaign, just as they did when Corzine and Jamie Dimon stole $1.2 billion from farmers.....

The saddest part is that nobody cares. 99.9% of the world’s population doesn’t know what LIBOR even stands for, let alone care about its manipulation. How long will we accept the corruption and remain subservient to bankers and politicans? When will we have our Howard Beale moment?


Click here to watch this (Network: Mad as Hell Scene)

Gold breakout above $1600, silver above $28 - is it sustainable this time around?

It is probably a fool's game to try and predict short term movement in precious metals prices - particularly in the much more volatile silver sector where the small market size makes it particularly prone to manipulation by vested interests up or down. But with gold there does certainly seem to be resistance to downside falls below $1550 and an underlying propensity to reach higher levels again. It is notable, for example, how well investment in the top SPDR gold ETF has held up through a disappointing period for the yellow metal which is a strong indication that the big North American money is looking more and more for a rise in price in the months ahead. Indeed investment also appears to have been pouring in to some of the other significant gold ETFs too, notably in Europe, as those increasingly worried about the European financial sector move their capital into traditional safe havens....

While all eyes may be on the U.S. , Europe is already seeing more Quantitative Easing expanding monetary supply in this key area and the sovereign debt situation here looking to run and run and prospective bailout funds still insignificant in relation to Spain and Italy's huge debts alone. ...

China is also expected to add more stimulus to its massive economy, where growth is still slipping....

                                          ................. Lawrence Williams 

Can Americans Escape the Deception?

...the death of the US Constitution or urge his audience to action to restore the only document that protects their liberty.....As in medieval times, American citizens can be thrown into dungeons and never accounted for. No evidence or charges need be presented to a court. No trial is required, and no conviction.... As in tyrannies, US citizens can be executed at the sole discretion of the despot in the Oval Office, who sits there drawing up lists of people to be murdered....Protestors exercising their constitutionally guaranteed rights to freedom of speech and freedom of association are attacked by armed police, beaten, tasered, tear-gassed, pepper sprayed, and arrested.

Whistleblowers who report the government’s crimes are prosecuted despite the statute that protects them....

In short, in “freedom and democracy” america, the people have no voice and no rights and no representatives....The crimes against humanity, the dismantling of the US Constitution and the lawlessness both domestic and international that define 21st century amerika are the results of September 11, 2001..... 

                                  ............... Paul Craig Roberts