Zero Hedge Article And Comments Highlights


Financial - May 30, 2011


2015.1.17. The Truth "Behind" The Charlie Hebdo Solidarity Photo-Op (pdf)

A good review of another media manipulation for political ends...

Political leaders in staged Paris photo op in support of increased internet restrictions and imposition of greater government regulation of so-called "hate"-speech.


...Once again the mainstream media peddled the spoon-fed propaganda that world leaders "led the march" to honor the victims of the Paris shootings last week. Glorious photo-ops of Merkel, Hollande, Poroshenko, David Cameron (oh, and not Barack Obama) were smeared across front pages hailing the "unity in outrage." However, as appears to be the case in so many 'events' in the new normal managed thinking in which we live, The Independent reports, French TV has exposed the reality of the 'photo-op' seen-around-the-world: the 'dignitaries' were not in fact "at" the Paris rallies but had the photo taken on an empty guarded side street...

Jack Burton

" a failing, nihilistic satire magazine "

A magazine who not long ago fired an employee for anti Israel statements. It seems that Israel is the spoiled child of this magazine, whose Zionist roots are clear enough to see. I have seen a number of cartoons this Zionist magazine publishes, firstly they are not funny, not well drawn, childish, and totally committed to the Neoconservative world propaganda war on the populations of France. Wanna know the people government wants you to hate? Read this pathetic magazine, written by it's former baby boomer university student protestors. Liberal bastions of political correctness and deeply rooted in Zionism. No room for any anti Israeli talk inside the offices, because they are too busy writing cartoons to further the CIA's latest enemies list.

Of course these fake liberals are deeply supportive of Israel and Ukraine's Kiev Fascist Junta. Who ever the Washington Zionist dictatorship tells them to smear, they smear. Doing the occasional cartoon designed to make them look unbiased in their humor. Besides, these fuckers are not at all funny.

Zero Debt

Photo op? How about psy op? How about total utter staged propaganda ploy, seizing the moment for political purposes? Suddenly everyone agrees, miraculously, on something. Anybody see a problem with this? All national agendas, suddenly aligning? A total coincidence?

"Terror attacks", the key word to trigger sympathy, exasperate and plug outrage 24/7 among the sheeple, who have nothing better to do with their time, and no ideas of their own. Hey, look at these blurry photos of men with beard and shaky videos of beheadings, isn't this an outrage, so now everybody, listen up and respect your leaders! Fear and hysteria, rile them up! Excite them to the point of loss of logic. Create unity and then ban encryption and any private conversations once and for all! Because your leaders said so. Just keep voting, as if it helped. BAAAAH!

But gosh, if someone dared to draw a synagogue caricature to ridicule j-s, then there is no free free speech for you, because that is "hate speech" by law in multiple countries and is banned. Kind of like ridiculing Da King in Thailand. Oh, and feel free to draw islamic things, and enjoy those derogatory cartoons, while chewing on those baguettes, judging people you never met, among who you have no friends and have never met anyone in person, but do not never ever ever dare to draw anything remotely similar to the from the h-l-c--st because then you go to jail, expedited process without fair trial. And do not ever, ever, talk about the h-l-c--st when asking a question, do not even think about it. An open society is a society that pounds Islam to the point of total ridicule, period full stop. There is no honor, respect and tolerance for islam, because dishonor, disrespect and untolerance towards Islam is necessary to build a George Soros-style open society with free hate speech. Because this is France.

Why can't people see the total in your face lack of logic in the argument and keep holding up their pathetic looking Charlie banners to please the government and play along the mainstream narrative? How about free speech for everybody, can you handle that, Charlie? If you are in trouble, just ask Yellen for more money, I heard she has some and NY Times will print a nice story for you. Thanks in advance!


Are we even sure they were all there? Seems like a lot of work; would be much easier to "generate" the proper picture with PhotoShop. Surprised they didn't cut-and-paste Obama into the photo.


Everything evil in this world is funded by Hidden Hand Criminal Holdings Inc. If there were any real terrizz out there, whatever their religious affiliations, motivations and endgoals, they would have droned the living fuck out of these mighty losers at their private "march" photo-op gathering.


That "freedom of the press" map cracks me up ... CANADA is in white for "freest" ,,, lets see what happens if one article comes out critical of Sharia law or stating that Man Made Global Climate Change is a hoax meant to enrich the elite ... you get jail time and your family is ruined.


depends on who defines "free". A prison guard might suggest that you are "free" to wander about the yard for an hour. A good judge of freedom might be the percentage of people residing outside of prison walls. Of course governments can always find ways of fudging the numbers, like the UK did with emergency room wait times by simply keeping everyone in the ambulances. One way government could get prison populations down would be a more "liberal" use of the death penalty. Rather than freedom, a prison non-participation rate.

Ultimately everyone wants freedom until it comes time to pay for it. As much as we would like to think our constitution "entitles" us to freedom, it simply gives us the basic tools to fight to keep it, tools deemed too laborious, confrontational, to be considered proper. The shortest, easiest path usually leads to hell and we are well on our way on it.

KCT Comments

Whenever the corporate media is uniformly supportive of something, or when the media reports on an issue ad nauseum to the exclusion of so much else, you have to consider what its true agenda is. With so much of the West's military budgets spent on domestic propaganda, and with software like Photoshop and the advent of digital media, who can say what is real and what is not, even when you have a photo right in front of you? A general rule of thumb is -- and this will get you shot if you are a successful activist -- is to just say NO to war and say NO to excessive government intrusion into our lives. Evil waxes fat through war. And what we find is that 90% of violent provocations, especially those highlighted by the fascist media, are self-inflicted wounds orchestrated by the intelligence-security state for its own ends. Trillions of dollars of no-bid contracts and the furtherance of authoritarian world governance hang in the balance.

I listened to an interview with Dr. Paul Craig Roberts. He described a number of angles that I had not considered. One is that France had been aligning more with Russia and the Palestinians. France was growing tired of the US "war on terror." This supposed "attack" by supposed "Muslim extremists" has weakened France's leading politcal party and brought the country back under the US war umbrella. The Hebdo affair has given more prominence to right wing, anti-immigration, and anti-Muslim political groups across Europe. I am not sure what this means. But at the least it could lead to greater instability, and as we know from our controllers, they seek "order out of chaos" -- that is, they foment divisions and strife so as to steer populations into structures and understandings they would not otherwise accept.

On the Infowars Nightly News I learned that some of the supposed Charlie Hebdo attackers were associated with a CIA-linked Muslim iman who had famously "dined at the Pentagon". Some of the attackers cohabitated with the "underwear bomber" (a CIA-linked Muslim useful idiot who tried to start a fire on an airplane). All this reeks of false flag and political maneuverings.


2013.4.4. In Cyprus, Shock Turns To Anger (pdf)

A Zerohedge comment from TwoShortPlanks

A mate of mine asked me what's going on in Cyprus and Europe as a whole....kind of a pointless question without the Big Picture.

Here is my response;

Yeah, the more I read the bigger this whole game is…and it really is a game of winner takes all.

You have many factions woven into several layers within the game. There are the countries around the world, there are the major financial infrastructures, there are the superrich entities, and there are the banking entities which stitch the layers together…which makes sense.

The best way to think of them and how they interact is by way of a Venn Diagram (below), then this will all make much more sense.

Take a simple Venn Diagram with 3 overlapping circles (A + B +C). Note that there are a total of 8 sectors including space outside the circles.

Let’s say that;
A = Are the countries of the world
B = Are the major financial infrastructures of the world
C = Are the banking entities of the world

The next layer is where just two of the major players overlap;
A/B = Military Industrial Complex and Major Corporations
B/C = Central Banks
C/A = Major Banks

You can now see how every entity is affected by every other entity, to varying degrees!

There is also another sector, right at the centre. This is the Superrich entities who own most of the real assets on the planet, such as a vast majority of Military Industrial Complex, the Major Corporations and the Major Banks, as well as most of the natural resources. Since the Major Banks own the Central Banks, then the Superrich own the Central Banks as well.

Now here is where it starts to get a little grey…..

Who is at the centre?

Well, there are at least three types of Superrich entities, they are;
1. The ultra-wealthy families who have had money since at least the 1700s’. These families are well known historically but they are very well hidden today, so too is their money (Gold and something else).
2. The Oil wealthy such as the Arab states. These are newcomers to the centre and their future is tied-up with the prosperity of their countries; if the country falls, so do they.
3. The Oligarchical wealthy. More newcomers who have recently emerged from the end of the Cold War. These include most of the families which prospered from the Military Industrial Complex, like the [George] Bushs’, and Mafia type Oligarchs like Putin and his KGB mates.

Ok, so that paints a picture of how all the visible entities fit together…..but there’s another layer. This is a very, very well hidden layer.

Imagine that the Venn Diagram (the whole world) is drawn on a single piece of paper, well, who owns that piece of paper???

I believe that the next and final layer doesn’t really have a name…but I’ll call them the Custodians! The Custodians essentially won 80% of the world between the 1300’s and 1700’s. They comprise of many or most of the Ultra-Wealthy entities dating back as far as the Black Venetian Nobility, the Templars, the Teutonic Templars, the Vatican, and later entities such as the Rothschild family.

On the Venn Diagram these Custodians own most of the paper as well as the entire centre sector of the Venn Diagram.

These Custodians own vast, vast sums of wealth, accumulated over centuries. I believe the sums would be in excess of $700 Trillion. HOWEVER, this figure is not a Dollar figure, or a Yuan figure, or even a Euro figure and this is why…

When Rothschild created the Central Banking System he also created a layering of the system where, the Major Banks in each country owned the Central Banks from whom they borrowed the money. BUT, as with all systems it is built upon a network, and in the case of the Banking System and the entire Global Financial System it is built upon a framework (network) which is 100% owned by these Ultra-Wealthy elite families. It has been this way since the end of the Napoleonic War, where, Napoleon threatened the entire European Banking System as he believed in a Bank of France which lent money at 0% interest…he hated Banks, and Banks hated him!

So the real question is, what is the framework, what is the network???

The Custodial Framework
United Nations - Global Police
World Bank - Global Lender
International Monetary Fund - Global Debt Collector
Intelligence - Custodial Eyes & Ears (Mi6, Mi5, CIA, MSS, Mossad, FSB {KGB}, SIS, CSIS, ASIS, DCRI, BND etc)
Power & Control Centres - US Council on Foreign Relations, European Council on Foreign Relations, Club of Rome, Bilderberg Group, Royal Institute for International Affairs, Trilateral Commission etc.
Main Stream Media - Global Propaganda
Hollywood - Global Propaganda and epicentre for Alternative/Pagan/Kabbalic/Ancient Mystery Religious interests.

The Custodial Network
Bank for International Settlements - Global Banking Computer Network for the movement and transfer of Global Currencies (the Back Bone)
London Bullion Market Association - Physical distribution and controlling agency of Gold (real wealth)
Central banking Network - Physical distribution and controlling agency of Global Currencies (medium of exchange for services, goods and labour)
Organization of the Petroleum Exporting Countries – Global distributor and controlling agency of Global Oil (consumable real wealth)

What you must understand is that Currencies are merely a medium of exchange but Gold is real wealth and Oil is consumable real wealth. Oil is a type of hybrid between Currencies and Gold, this is why Oil States sell Oil in Currency (US Dollars) but there is always a payment in physical Gold as well. Oil has a usable function, Gold has a storable function, currency is merely a rate of exchange. You can think of Currency in terms of energy, Currency isn’t the fuel, Currency is merely the calorific value of the fuel being burned.

By the very nature of both the framework and the network, we can have a complete and total collapse of the Global Financial System and the Custodians don’t lose a single penny as they can simple create a brand new system at the click of a finger…new Currencies, new Bonds, new Banks, new Political systems….new everything….a brand new farm! This is because they own the machinery to make farms as well as the technology to do so.

People talk about a coming New World Order. If you believe what I have written you will see that it’s not coming at all, it’s already here, and has been here for perhaps 300 years. What they are talking about is merely the next cycle within the existing NWO…nothing more!

If you believe this, then for you the truth is revealed; that the threat of a coming NWO is a False Flag event. It is a deliberate misdirection to distract you from the truth hidden in plain view. If you believe that a NWO may be coming, then by definition, you believe that a NWO cannot currently exist. This is precisely what they want you to believe. They do not want you to realize that the NWO has already been implemented incrementally over the past 300 years and especially since the propagation of the Global Central Banking Cartel whose greatest achievements were the Bank of England, the United States Federal Reserve System, and the Eurozone (including European Central Bank).

There is of course one thing which they cannot create at the click of a finger…Gold!

When financial systems collapse the wealth transfer goes into Gold, which then becomes the store of wealth until a new system is put in place, then, the wealth transfer goes back into the new financial system. So, owning Gold is owning a piece of the next financial system, not the current financial system…get it? This is when Gold is most potent.

For this reason, every time the financial system becomes fragile, every entity always runs to Gold. Often they don’t really understand as to why, but they do nonetheless.

The real reason as to importance of Gold is very, very simple. Gold doesn’t sit within the Global Financial System itself, it sits outside the system (outside the Venn Circles), resting on the blank white paper which is mostly owned by the Ultra-Wealthy. In visible terms it is like the ‘Construct’ in the movie the Matrix, something which underpins the false reality which is created upon it.

To own Gold is to own both a commodity which is assigned a Currency value as well as a piece of the next framework, a piece of the next network. Everything else is which is going on is just noise and distractions to the masses….’Bread and Circuses’.

Currently, we are seeing suppression in Gold. I believe the reasoning behind this is to buy-time, enough time so that the framework and network have sufficient Gold reserves to restart the system and a long enough period of time so that the Gold buying is invisible to the general public, so as to avoid a panic or ‘run’. In any case, the next cycle is inevitable and it is coming whether we like it or not, or whether we are prepared or not.

KCT comments 2013-05-05 on the Two Short Planks post: I don't have the time, the brain power, or the necessary access to accurate information to fully know what is going on. What I am confident of is that there is epic fraud and intentional harm occurring in every aspect of our lives: financially, politically, intellectually, culturally, sexually, dietarily, et cetera. We live, essentially, in a matrix of disinformation and physical and spiritual assault. There are people and media sources that I trust for the most part (for example, Alex Jones, Catherine Austin Fitts, Paul Craig Roberts, Jeffrey M. Smith, and Webster Tarpley). I don't trust media luminaries like Amy Goodman and Noam Chomsky principally because they have denied or avoided the great false flag event of 9-11. 9-11 is the litmus test for intellectual honesty. Unless they are willing to speak the truth on this topic, then I know that they have agreed to speak or report honestly only within a pre-conscribed area of truth telling. Tarpley calls coverage of this sort a "limited hangout," which means that enough truth is told to win your trust, but much is still omitted. 9-11, chemtrails, cancer cures, and several other subjects are a third-rail in corporate and (so-called) "public" media, which if you touch upon you will be found fired, killed, or the subject of a comprehensive smear campaign that severely undermines your credibility. This doesn't mean that I believe everything someone like Ms. Fitts says. What it does mean is that I trust them enough to open my ears and heart to them and pay attention to what they say. I give time to consider their point of view. At the same time I disregard and withold attention from just about everything produced by the corporate media or by any source that has shown itself to be unworthy of my trust.

But I believe that I know enough to act on at least a few matters so here they are:

I have set aside some of my assets at GoldMoney, a precious metals vaulting service that places your assets both outside the USA and outside the banking system. I figure this will work out until such time that there is a global effort to make private ownership of gold illegal. I expect bankrupt countries to seize whatever assets they can, even if they exist at private vaults within their jurisdiction. I think that will be a while yet, because Fitts believes that the low-hanging fruit is pensions and bank accounts. The government will force $trillions of private pensions into government bonds, even as bonds lose 90% or more of value. The advantage at GoldMoney is that you can have your precious metals shipped to you just about anywhere in the world. Or you can covert the PMs to cash in any one of nine (as of 5/2013) currencies and wired to you anywhere in the world. This is important because failing states uniformly impose capital controls, severely limiting the ability of individuals to take assets out of the country. If I wish to relocate from the US to New Zealand or Paraguay, for example, GoldMoney will allow me to have some seed money or assets available irrespective of US tax or capital controls policies.

I bank mostly at a local credit union here in California. They have no derivative exposure, and don't leverage their deposits or engage in the vast criminality that Bank of America, Chase, and others do. I do keep a small account with one of the bad Wallstreet type banks, but it's just for flexibility and to help me deal with my migratory lifestyle as I move from place to place seeking better conditions in a constantly changing manmade EMF landscape.

I buy organic foods almost exclusively. Unfortunately, much of the organic foods industry has been vertically integrated by giant agribusiness concerns. These entities at the top seek to undermine organic standards at the federal level. I don't do enough to support local farmers or non-chain markets. But what I am doing is a step in the right direction.

I operate this website and share relevant truth-telling information with family and friends by email. There was an earlier version of KCT with a lot more personal information shared. In 2004 Google used to give me 500+ search referrals a day. In 2013 it is down to less than 1% of that. Their obvious censorship, as far as I can tell, is due to my emphasis on government-sponsored terror. Google, Amazon, and almost all news sites actively suppress public access to this information. What I liked about my old site is that visitors would come for spiritual information, stay for a while, and learn about politics; or be referred for a cultural query and end up learning something about kundalini. My site would get hits for thousands of keyword searches. Now it has almost all dried up except for an occasional referral by non-Google and less government-controlled search engines. Just as the silver market is manipulated to suppress valuations and bolster confidence in the fraudulent and unconstitutional US Federal Reserve Note, so it is that good information on 9-11 (etc.) is suppressed to maintain confidence in nation states as we are forced into global depression, world war, and a banking cartel-controlled international government.

All the above may be found to be too big to get your mind around. Fitts says, "Don't worry." You aren't going to get the bad actors to have a change of heart. What you can do is to withdraw your financial support of their activities as much as possible. This is the best way to modify their behavior when the problem is political. Bank locally. Get out of cash and things the bad guys can easily control. And withdraw your attention and support from the filth that flows from Hollywood and the corporate media. If 7 billion people did this, we would win this war overnight.




2012.3.17. Chris Martenson And Marc Faber: The Perils of Money Printing's Unintended Consequences (pdf)

My notes: Faber sees coming chaos due to excessive money printing. He recommends a diversified portfolio that includes real estate, equities, and precious metals. Faber recommends duty-free privately managed safe deposit boxes for securing one's gold outside the US at international airports all over the world, for example in Singapore where Faber now lives. He doesn't mention silver, just gold. But Gerald Celente is diversifying into silver due to concerns over gold confiscation (in the event that the US goes to a gold-backed currency and makes private gold ownership illegal). Jim Rickards has said that a gold-backed international money system will be in place solely for settlement of international trade; but that individual countries or regions will return to another fiat currency system after the current one hyperinflates away. It may be that gold will not be allowed to be owned privately in that situation as well. Faber likes certain real estate markets in the US where properties can be purchased at a 30-40% discount to their construction cost. He cites Atlanta, Las Vegas, and several other locations where real estate has nearly bottomed out. Areas like California are still in a bubble and are at risk of further deleveraging in the event of a global crisis, e.g., war with Iran, Russia, and/or China, or a massive spike in oil prices to $200 per barrel that will effectively shut down the world economy, or anything that sends interest rates well above their current 2%. Faber says Las Vegas prices may come down another 10% but that will be nothing compared to the 40% hit that many other markets will take. As he has said before, equities may take a 40% hit in a global economic panic, but he says that most large companies will survive whatever transpires, and holding stocks will be better than holding bonds or cash. I've heard precious metals bug Rick Rule discuss how he has a large cash position as he awaits what he calls a "psychotic break" in equities and precious metals pricing, where he expects a 40% drop and fire sale prices. I personally do not have a trader's mentality or instinct, so I don't wait around for market crashes. I basically have made the decision to buy gold and silver at whatever price they're at when I have additional funds. My bet is that the many $trillions that have been added to sovereign debt and central bank balance sheets in the last several years -- and the fact that the US government continues to run a $1.5 trillion dollar deficit, borrowing roughly 40¢ out of every dollar it spends -- will lead to additional inflation and loss of purchasing power for the US dollar (and every other non-"hard" currency). It won't be until the federal government reduces its borrowing and indebtedness, stops subsidizing the continued loss of US jobs to Brazil, China, and elsewhere, and ceases its military involvement in over 100 countries (thereby cutting at least $1 trillion per year), that I will be inclined to trust cash again.

Faber states that in the coming calamity "we're all doomed" and that even people who place gold in different locations throughout the world, or who have well diversified portfolios, will just be buying themselves time. In many countries people holding cash will find themselves bankrupt overnight or in a short span of time. We don't know when that will come, but it assuredly will, and we must make preparations. It was an interesting, disturbing, cryptic comment. I don't think he meant a merely economic catastrophe. I believe Faber is thinking of nuclear war or pandemic, and the economic breakdown that would accompany it. Faber is concerned about the erosion of civil liberties throughout the world, especially the US. None of this bodes well for his longterm economic outlook.


2012.2.2. An email to a colleague regarding the American Association of Individual Investors (screenshot 2/5/2012). She had attended recently an investment convention sponsored by this group here in Southern California.


I checked out the site and found it lacking. It seems more of a slick establishment operation to keep people in mutual funds and other paper products pushed by the likes of T Rowe Price. The Dow has gone NOWHERE in the last decade. Anyone invested in an index fund has gotten hammered; at the very least their investments haven't kept pace with food and energy, i.e., real inflation. Gold and silver are up 600% in the same time frame, and are set to go up another 500% minimum in the next decade. This isn't just my own two cents.

I get my information from the following sites:



2012.1.26. Financial note to family.

Get your precious metals now or regret not doing so.

With gold at $1727 and silver at $33.60 at 6:00 am today, I suggest going all in with whatever cash you have available.

Please check out

Zero Hedge: Gold Extending Gains On Realization Fed's Only Option Is CTRL+P (pdf)

King World News: John Williams - Accelerating Great Collapse & Hyperinflation

King World News: Jim Sinclair - Mainstream Entities Will Now Enter Gold Market

King World News: Von Greyerz - Gold Breaking Out, Will Hit New All-Time Highs


My response to a family member regarding the above:

The comments at Zerohedge are always informative.

It may be the case that there will be a banking crisis in Europe that sends everything tumbling again. But the metals in my view would rebound to the $50/$2000 that people are predicting for this year. You could get the metals 10% lower than they are now, but then again, it might not happen because the Fed has said it's going to print whatever it needs to keep the whole financial system liquid, including bailing out Europe, which will eventually turn the US currency to toilet paper.

I agree with you about prudence. Unfortunately, there aren't too many good alternatives for people at this time. A 6% return on real estate probably won't keep up with the kind of inflation we're going to see. There might be some equities in emerging markets, or sovereign debt of a fiscally responsible nation like Norway, but I don't know much about those things. I do believe that we are witnessing the unraveling of a 100 year reign of Federal Reserve fiat currency that is backed by nothing. We'll see what is and what is not "prudent" within the next few years. There are a lot of people who are placing their faith in gold at this time. I don't think they are mistaken. But we shall see.

Note from 2/4/2012:

We still haven't seen the "hard" default of Greek or any other nation. Many companies and countries should have gone belly-up by now due to bad investment and fiscal policy, but due to the covert manipulation of the money and ratings systems, they have not. As many such as Catherine Austin Fitts have said, we have a "political," not a "free" market. There is no more true "price discovery," as politics now dominates the economy. Sectors boom wherever the politicians/technocrats allocate money or preferential regulations. So, unless you are an insider and trade on proprietary information withheld from the public, you cannot time market moves. But over the longterm smart people are in general agreement that unless we get our financial house in order, real assets like gold and silver (and farmland and oil etc.) are going to continue to rise -- at least in nominal [non-inflation adjusted] terms -- as currencies are debased. Additionally, as people and institutions lose confidence in fiat money systems worldwide, much more money will flood into assets like precious metals that will send their valuations skyrocketing, even relative to inflation and the ratio of fiat money to total PMs available. At some point investors in precious metals (and energy and food and other items of REAL value) will trade their holdings (or a portion thereof) for land or whatever it is that they need. A good time for this may be during their respective country's default or when a new currency is issued. That is, there may be a final spike in valuation -- a "top" -- at which time some of your PMs should be exchanged for other investments/things.

I know that a month ago I recommended waiting for a hard soveriegn default or other obvious trigger. But with the Fed now publically announcing massive money printing for the next two years, sovereign defaults may not happen now as countries band together and go "all in" on inflation. Central banks may just print whatever $trillions they need to keep up the appearance that all is okay, and no spending cuts or policy changes are needed. So, seeing the 10-20% spike in metals prices since the first of the year, I've thrown in the towel and told family to buy right now and not wait, because even if there is going to be a dip below these prices, we don't know that for sure, and we certainly don't know when. There are convincing articles spelling out prices that are triple the $33 and $1740 prices we see right now within the next two years. If that is the case, you'd be a greedy, brainwashed fool to dally any longer.


2011.12.24. Financial Letter to my family members

My financial recommendations for loved ones:

Sell your stocks. Get out of cash and into real assets. Increase leverage in your house (take out as much as you can afford at the 3% interest rate). Place 50% physical gold, 25% silver, and 25% gold mining shares like Toqueville Gold (pdf). I wouldn't be buying real estate now. Wait for a devaluation or default, with all of your available reserves in investments that won't be hit so hard. In the next 6 months I see a major deleveraging event (some predict early March for a hard Greek default) which will cause a rush into US treasuries and a selloff of all assets including stocks and commodities like precious metals. Stocks may go down another 30%, gold may go to $1200, and silver to $20. The question is do you wait for these bargains? The problem is that inventories of physical are quickly depleted during these sell-offs as all the smart money moves in and scoops up the good buys. A paper entry into a mining fund will be no problem at this time. There might be a global currency devaluation event in the next few months along with a bank holiday. Nine countries did this during the Great Depression. More will participate this time as this is now a global game. A few weeks after a default in Europe the people of the world (ie. everyone receiving a government-subsidized check) will clamor for massive money printing, and Ben, the Fed, and the ECB will comply, causing a huge spike in select assets (not real estate) like gold and silver.

I am not Nostradamus here, but I've been glued to the financial media (ZeroHedge, King World News, CaseyResearch, and others) and this is the consensus view. (pdf) (pdf) (pdf)


A friend asked for clarification and I responded:

That was my own recommendation, not Faber's. Faber said real estate depended on where it was and that, like equities, it couldn't be sent to zero as hyperinflation will do to people holding cash or a default will do to derivatives. I stated that equities will be a good play after the coming deleveraging crisis that will follow a disruption to the EU. I haven't heard of a Greek default being a good thing for the banks in Europe or the derivatives holders here in the US like Goldman and Chase. It might be good for the Euro currency in the long run, but I don't think it will be good for anyone with exposure to Greek bonds. My logic is that people should cash in a portion of their precious metals after a significant spike in values after QE3 has done it's work and with that money buy real estate. You should be able to double or triple your purchasing power rather than going all in on real estate now and riding the beast downward with little hope of an upside. That is, I think a buy in gold now will give you 3x more real estate in three years or so. Although if you follow the Rich Dad, Poor Dad people, buying distressed income producing real estate using highly leveraged cheap 4% money might be a good bet now.


Email to a friend regarding precious metals 2011-12-21

I've been glued to ZeroHedge, CaseyResearch (Ed Steer), and King World News. Lord Christopher Monckton said on Alex Jones radio on Monday that Greece will have a hard default on March 12 (causing a crisis in the Euro). There might be something to that, in which case a massive surge of US dollar value (as $trillions seek safety in treasuries) and a deflationary spiral will occur. Most people think this will be the trigger for insanely huge QE, but not until the bottom drops out of the Dow and commodity prices (under 10K Dow, gold $1200?, silver $20?). Richard Russell says he's sticking with gold and gold stocks to the bitter end of this fucking mess because they will be the last "men" standing. People at ZH are mainly physical holders of precious metals, although there are a lot of traders there, too. I tried to buy physical gold and silver in Oct 2008, at the market lows, and there was hardly anything available. It's all a paper game, and people holding the real thing aren't letting it go too cheap. There might be some intermediate drops in stock/physical prices before the massive deleveraging event (most say by end of Q1 2012). Some people say that the miners have decoupled from the physicals due to GLD and the ETFs. I know that Toqueville gold has shown huge gains the last decade. As long as your picks are right, I don't see how this growth will stop. Deflation will bankrupt all the banks and cause the politicians to be kicked out, hence inflation will be the most likely route with an aggressive quantitative easing after a collapse in the euro.

I've got X oz of silver to my name, all physical. If I were a betting man, I'd sell it now and buy it back when the price has dropped 20%. But I don't gamble, and I don't know if any 1 oz ASE's [American Silver Eagles] will be available at those cheaper prices. [A family member] has more than me, mostly in gold, and I am telling her to hang on. She's got another $XK of cash, however, that I am waiting for another 15% gold drop before I recommend that she go all in -- like in the mid $1400s.

People at King World News say the price of the mining shares is incredibly cheap right now. Should you sell and wait for a market crash to re-enter? You could probably buy back in 20% cheaper than they are right now. I don't like to gamble. But it pisses me off when I don't capitalize on these market swings.

The consensus is that regardless of the market action in physical metals, prices will end 2012 higher than they started. Some say that gold mining stocks will peel off from the rest of the Dow and move higher, even with the Dow in the toilet. Who the fuck knows.

Just to be on the safe side, I'd probably liquidate half your portfolio into physical gold. Maybe 10 pounds at your side, and the rest somewhere with allocated, insured, third party verified storage like

Let me know what you think the ideal portfolio allocation is, if you have one.


The conversation continues:

How you manage your investments is your call.

The system has been a train wreck for years. We all know where it's going, just not when. I think you need to think in a 2-3 year investment horizon.

Did you check out the Faber piece?

What I read every day still leads me to believe that there will be a massive sell-off during some crisis in the next 3-6 months. Faber says cash will be safe only for a while. You ought to be able to buy mining shares for a third less down from where they are now, regardless of technicals saying they're a good buy at present. If you're looking at accumulating physical oz, then you might want to get in a bit sooner, maybe 10% down from current spot prices, before the total sell off (and possible bank holiday) that is predicted by many to occur in the near future. When? 3 months? 6 months? Maybe.

My entry points for silver were $12, $14, $19, $31, $35, $39, and $41. I don't plan on selling a goddamn thing until the silver price is over $100. That's when I am going to get me a little house on that 20 acre parcel of mine in the desert..


Mark Faber: "I Am Convinced The Whole Derivatives Market Will Cease To Exist And Will Go To Zero" (pdf) 12/21/2011

[my notes on the Faber interview]

-Under the Maastricht Treaty in 1992 when the EU was formed participating countries were limited to 3% fiscal deficit each year, and a total debt/GDP ratio of 60%. That not one country in the EU has upheld that treaty requirement is the fault of the bureaucrats. These countries will print and print and print. [As of 12/2011 several countries are well over 100% debt to Gross Domestic Product, some as high as 200%.] Wikipedia article on Maastricht_treaty of 1992 (pdf). Countries cannot alleviate the problems caused by too much spending and borrowing with even more spending and borrowing, yet that is exactly what we are doing. This is Keynesian economics. We are at the point now where increased debt is no longer able to stimulate the economy. We've become saturated with debt. You can delay the impact of excessive debt with more money printing only for a limited time. The longer you wait the worse the outcome will be. The $700 trillion of derivates exposure created since 1999 will go to zero as the contagion of counterparty risk consumes the system. If there is war, derivatives will not be settled and will go to zero. Greece should have been allowed to default and it would have sent a message that not all derivatives are equal. It depends on who the counterparty is. People will be lucky if they have 50% of their money [purchasing power] in five year's time. Need diversification: some gold, some equities, some real estate in the countryside. In the past century German bond holders and cash holders lost everything three times. If you held equities at least you didn't lose all of it. Real estate depends a lot on location. East German real estate after WWII did not do well. In the US only properties in Aspen and Park Avenue have done well. Worried that governments again may make private ownership of gold illegal. Right now avoid government bonds. Cash will only be useful for a brief period of time.


ZeroHedge poster comments on Faber interview

seek Wed, 12/21/2011 - 19:27 | 2002974

It's the final wealth transfer if the counterparty fulfills their obligation, but there is something left, because the derivative holder gets the collateral (e.g. something) though it will be insufficient to cover the value of the derivative.

There is no question, though, the derivative default/collapse is the terminal event. Once it happens, it is the signal that contracts are null and void (pointless because they can't be fulfilled), and that is the point of economic lockup and separation of the paper part of the economy from the tangible good economy. Counterparty risk becomes infinite, so the only viable transactions are those with no counterparties, essentially bartering good for good with immediate delivery. Since the paper part extends to government debt, presumably the currency collapses as well.

This is why they've worked so hard to not declare the haircuts, etc at default events, to prevent the unwind. In reality, when this hits, I seriously doubt they'll let it unwind even then -- the more "stable" (ha!) way to handle it is probably a devaluation event, though I would imagine it's going to have to be coordinated between the major currencies. This probably explains why it hasn't happened yet: I suspect somewhere there are meetings taking place with each country negotiating the gang rape of the citizens, and they're getting hung up on details of who gets screwed the most and how.

Just to wrap up the thought experiment here, it plays out:

- Risk of imminent derivative default presents itself, probably triggered by a sovereign default/haircut that can't be kicked down the road. Immediately prior to this there are asset (including gold) sell-offs as derivative contracts try to deliver. This accelerates.

- It becomes obvious to the TPTB that this is indeed the big unwind event. Given what happened in 2008, this realization takes place in 48-72 hours. Like 2008, the tip off will be accelerating sell-offs and secret government meetings at the same time we're hearing everything is fine from the talking heads.

- Unlike 2008 the markets can't be calmed down with the unlimited guarantees, because the outflows have virtually nothing to do with retail investors anymore, and the banks that are responsible already have been operating on the assumption of government backstop and using that to gamble even more. The pure printing solution just accelerates the problem (hyperinflation/currency collapse) so this won't happen. The only option is a "market holiday" that will happen as a result of the secret meetings in that 72 hour window. This is the very last public event before the crisis is "solved." Best guess is the holiday runs 1-2 weeks at most.

- During this holiday obviously markets are closed. I don't think the banks will be however, but capital/withdrawl controls will be in place. There needs to be enough money available for people to buy food, etc, otherwise due to being a cashless society riots start really fast, and TPTB want the people docile so they don't realize how fucked they're about to be.

- After this 1-2 week holiday, joint announcement of most major currencies to simultaneously devalue, maybe with the announcement of a new global regulatory authority and a sovereignty grab.

Now I think some of the banking interests will know this is the "solution" ahead of the market holiday by a decent margin, so I suspect they might make some sort of move in commodities a week or two before this goes down, and also buying up favorably priced (e.g. distressed) debt knowing it'd be paid back in devalued dollars. All of this also need to be not-too-obvious, so my guess is you'd see a puzzling jump in volume and pricing in some of the most traded commodities that have a high percentage of actual deliveries (not sure what this would be, maybe foodstuffs or oil, but it won't be gold, since it's too small and too obvious., though little doubt retail investors and slow money will drive gold up during the 72 hour crisis window.) So this would be a leading indicator, subtle wierd changes in commodities with deliverables right before or during a big sell-off.

Given 2008, though, all the important things will happen in a 5-day window that happens after maybe a week of obviously high market stress.

Just wild hypothecating, but my guess is we don't have much longer. Definitely under 2 years, maybe less than a month.


sgt_doomWed, 12/21/2011 - 16:17 | 2002311

Now, consider this: the top four US banks (JPM Chase, Citibank, Bank of America and Goldman Sachs) control nearly 95% of the US derivatives market, which has grown by 20% since last year to $235 trillion. That figure is a third of all global derivatives of $707 trillion (up from $601 trillion in December, 2010 and $583 trillion mid-year 2010. )

Breaking that down: JPM Chase holds 11% of the world’s derivative exposure, Citibank, Bank of America, and Goldman comprise about 7% each. But, Goldman has something the others don’t – a lot fewer assets beneath its derivatives stockpile. It has 537 times as many (from 440 times last year) derivatives as assets. Think of a 537 story skyscraper on a one story see-saw. Goldman has $88 billon in assets, and $48 trillion in notional derivatives exposure. This is by FAR the highest ratio of derivatives to assets of any so-called bank backed by a government. The next highest ratio belongs to Citibank with $1.2 trillion in assets and $56 trillion in derivative exposure, or 46 to 1. JPM Chase's ratio is 44 to 1. Bank of America’s ratio is 36 to 1.


ebworthenWed, 12/21/2011 - 16:22 | 2002341

I too, fear that governments will confiscate or outlaw PM's and institute electronic transactions only.

They would have complete control, especially over taxation.

Their ultimate goal has to be to get rid of any underground economies, and thus, means of exchange.

Hopefully, everything will collapse before we all become automatons.

Live free or die.


ebworthen Wed, 12/21/2011 - 16:52 | 2002454

I hear you.

There is a lot of gold they would never get their hands on; and as RockyRacoon points out is was forced redemption not confiscation and only 10%-15% effective.

Their goal, however, was and would be to force the obedient sheeple to hold fiat, or buy equities, or not take their "money" out of the bank.

They work to defeat alternate currencies and forms of barter and exchange to keep assets under their control for taxation/confiscation and to prop the ponzi.

Believe me, I am holding gold and alternate assets, I just would not doubt that the FED and TPTB will try to defeat everything that is not trackable fiat.


RockyRacoon Wed, 12/21/2011 - 16:44 | 2002422

Gold wasn't confiscated, it was a forced redemption. The owners were paid for their gold at the current price. Just a minor quibble but it does reflect on the discussion. None of it was fair, and the re-valuation of gold was criminal, of course.


NotApplicable Wed, 12/21/2011 - 16:38 | 2002402

Since there isn't much in private hands, I doubt they'll bother. Instead they'll just make the buying/selling of it illegal, with digital exceptions that they have full control over. Since they own everything anyway, it will eventually percolate back up to "them" as we consume the wealth is stored.


JoBob Wed, 12/21/2011 - 18:03 | 2002751

Who says they need a reason? All they have to do is declare the personal possession or use of gold as an act of terrorism against the sovereign USA. Anyone caught even thinking about gold can visit a "detention center", have all of their assets confiscated, and kiss their futures goodbye. The bad news is that it could be done today with the laws already on the books. Unconstitutional laws, but adequate for the guys with the big guns.


Caviar Emptor Wed, 12/21/2011 - 17:03 | 2002503

Faber has often made this call. He believes, based on German 20th century history, that the right hedge for inflationary policies will be gold and stocks. He does mention two caveats: that individual companies will go broke and their stock go to 0. Of course. And that you still lost money with equities compared with inflation. My own calculation based on the German stock exchange 1920-24 compared with the dollar-rate of exchange of the Mark shows that the magnitude of losses was enormous: one trillion versus 26 million. And the number of bankruptices were enormous making stock picking extemely perilous

Best returns by far were for gold and for stable foreign currencies or bonds denominated in those currencies.


the grateful un... Wed, 12/21/2011 - 17:16 | 2002561

the US is against the gold standard because they would be at a distinct disadvantage to countries with small currency floats relative to their gold reserves. so if country A and B have the same amount of currency in circulation, and B has twice as much gold, then B's currency is worth twice as much regardless of GDP. and anytime you take currency out of circulation, which A would have to do to bring its currency to par with B, that is deflationary.

and i like the gold miners after the crash, as in a gold standard race countries will count gold still in the ground, just as countries count oil still in the ground as part of their reserve. and the beauty of that is the gold never has to be mined to make it viable. (so i see all sorts of mining technology to verify the gold, but little real mining, while the cost of mining gold will go through the roof and defeat the rise in the value of the metal, just as it is doing now)

so i would rather own the miners than the physical metal, which the government will confiscate as national treasure, and perhaps even bury it back in the ground.

but first we have to take the paper value out of gold, and go from there.


NotApplicable Wed, 12/21/2011 - 17:22 | 2002592

They'll nationalize the miners (sans the biggies (to maintain the facade, as they are effectively nationalized anyway)) long before they go after the metal in private hands.

They produce money, after all, which is unwanted competition.


the grateful un... Wed, 12/21/2011 - 18:31 | 2002832

the government will buy it all, and there will be no market in gold if we go on the gold standard. ultimately an oz will be worth an equivalent value in cash backed by gold, so there is no point in owning gold once you go on the standard. there will be no purpose to mining the gold, once the value of the gold has been estimated and verified, and who knows what the value of discovering new gold will be, although it will probably be against the law to mine gold since all gold is part of the national reserve, it would be like cutting down one of their trees in a national forest. people have this belief that gold is somehow magic, but the government can render it down to a useful product by setting up a gold standard. and they probably won't have a choice once the competition to create gold backed currency begins, you could see plays like Zimbabwe get rich overnight. crazy as that sounds.


ClassicalLib17 Wed, 12/21/2011 - 17:59 | 2002729

I would appreciate some advice here. I'm sorry for asking these questions, but I don't know anyone who can advise me honestly. My mother has 26,000 in U.S. Savings Bonds and I suggested she cash them in and pay the taxes so I could buy some gold and silver instead? And I have a small IRA Roth that I am considering cashing in w/penalty and doing the same with that. I'm wondering what the down side would be. I also have an annuity with my union and I am 18 months from withdrawing that without a penalty. . I have benn a member for 60 some odd weeks and a reader for about 80 weeks. Any help would be greatly appreciated. Thank you


AC_Doctor Wed, 12/21/2011 - 18:27 | 2002821

I will guarantee you that your gold and silver (held in physical form) will outlast your Mothers US Savings Bonds and especially your Union pension. Metals are on sale...


the grateful un... Wed, 12/21/2011 - 18:49 | 2002876

your mother will get killed on taxes if she redeems those bonds in one year. start doing some tax planning now, get some professional help, you may have to find a few writeoffs. if the bonds don't mature leave them alone, the interest is probably far better than anything you are looking at. just imagine this, your mother gets nailed with a huge tax bill selling those bonds, then you buy gold and it drops in half the next year. not sure how old your mother is, but the older she is the more careful you need to be. she needs that money to live.

don't pay attention to those TV idiots like Suze Orman. she is a complete fool who preys on old people who are fearful. if your mother wants you to help her, and she has assets which she can use without a huge tax penalty look for something which produces income. maybe you can buy old duplex and you can fix it up and collect the rent and be the landlord.

my mother just bought a complete solar system, which is a return of somewhere between 5 and 8% on her money. logical, smart thing to do for her. your mother can also take out a reverse mortgage if she needs money to live, in order to avoid selling those bonds if the tax bill is too steep. housing values will probably drop further.

i might leave your annuity alone, but check and see if they ever allow you to buy time toward retirement? not sure how old you are. gold is such a tricky call, if you just want to speculate, and you can fool yourself that this isn't what you are doing, but from here anyone buying gold thinks they are going to get rich or they wouldn't do it.


Yen Cross Wed, 12/21/2011 - 19:48 | 2003018

Good on ya.


ClassicalLib17 Wed, 12/21/2011 - 22:13 | 2003300

Thank you, tgu, I have a duplex, free and clear, and my 91 yr old mother shares half at 350 a month. I appreciate and will heed your advice. Thank you, sir


dolph9 Thu, 12/22/2011 - 02:40 | 2003614

Withdraw all of your money from bonds and retirement accounts, keep some physical cash, a healthy checking account, and gold and silver. Lots of different ways to own gold and silver, but physical in your own possession is the best.

Other than that, spend the cash on stuff you need, make defense/water/food preparations, etc.


swani Wed, 12/21/2011 - 22:10 | 2003275

Listen people, if things get really bad, and they may not, but if they do, confiscation of gold will work much like the confiscation of gold and guns in Germany before WWII. And if they are imprisoning people for thought crimes while spying on everyone's every move, it would be so easy to legislate the confiscation and find the metal.

They would have electronic records of the purchases, acccess to people's cell phone and computer data, their social media contacts, they would know every website that anyone has ever visited on Google.

But if, before being taken to the Gulag, you managed to have buried some coins somewhere that the newly purchased Homeland Security metal detecting drones, somehow missed, when you did finally get out of detention, you would find that either a.) these coins were taxed so heavily that most of the value was taken upon the sale b.) they had made it 'illegal 'to possess or sell gold coins, if the person was a convicted felon/ terrorist/radical/whatever, or c.) they make it illegal to buy or sell the metal, except through 'licensed'i.e.'sanctioned' gov. dealers that would enforce the above.

This is just my paranoia of course, but it comes from historical presedents.

gwar5 Wed, 12/21/2011 - 23:45 | 2003461

....lucky for us gold filliings became unpopular a couple decades ago.

Gold confiscatory actions are something to think about but first people need to protect their IRA and 401Ks from getting confiscated -- that's $3 Trillion of low hanging theft that is easy for the criminals to get. That'll be first.

The other thing is, the amount of gold they could confiscate trying through police action and digging up yards would cost them a lot more than the value of the gold they'd find, unless you're a Marc Faber. More likely the criminal fascists will increase their East German tactics of turning neighbor against neighbor to turn in "evil gold hoarders."

Obscurity is still the best security.

TPTB will probably not be able to perform door to door confiscations in chaos. FDR did not even go door to door. Police will be too busy stopping the looting and protecting criminal bankers and politicians from urban armies chasing them down the streets. People will no doubt be telling any confiscators that knock on their doors that things of value have already been stolen by the previous bands of thieves that roamed through.

And if anyone still keeps PMs in a safe deposit box at a bank they deserve to have it stolen. During the days of the Great (Lesser) Depression, there were IRS agents at the banks and when they unsealed your box they were right there over your shoulder to confiscate your stuff. There's that, and now the TSA is in place at airports and highways to stop you from moving around.

Best way to secure your sovereignty and Constitutional rights is to become an illegal alien..... you will be free to move about the country, no confiscations of your property, no passport needed, no ID, no need to show up for court if you break criminal statutes, and the cherry on top is that Eric Holder and Big SIS will even give you an AK-47 if you switch sides.


Mike Wed, 12/21/2011 - 18:47 | 2002871N57

Interesting that Faber said War... could be the trigger, for derivatives going to zero.


americanspirit Wed, 12/21/2011 - 18:59 | 2002904

Let's see. Here is just what is in plain view, no secret to anyone half-awake. US SecDef just gave Israeli the green light on Iran. US tanks and troops that were in Iraq now on northern Jordanian border with Syria to protect Amman from Syrian armor when the King gives overfly permission to the Israelis. Iraq ready to be taken out of the picture by Iranian special forces, already in-country and in place. Anti-ship missiles all over the Syrian/Lebanese coast. US fleet just off the coast, also in the Gulf, both looking juicy. 3 big Russian combat ships in port in Syria - waiting for an accident ( remember the Maine!). US and Russian nuke subs in position in the eastern Med, quite certain where each other's assets are. Iran has no doubt pre-wired WMDs in a few major European (and US?) cities, and does I'm quite sure have at least a few nukes ready to go for local deployment (thanks to AQ Khan). Pakistan coming apart, moving nukes around the country in vans, easy pickings. Fuel that can get to Afghanistan costs $2000 a gallon and is in short supply, seriously limiting air capabilities from Iran's east. US stealth drones have been thoroughly hacked - waiting to turn Hellfires on Kabul. Saudi oil terminals approximately 2 minutes away from Iranian pre-targeted missiles which will go automatically in the event of a decapitation strike. AND, boys and girls, Christmas eve, when the whole Christian world will be distracted by Santa's journey from the North Pole, but when Muslims, Jews, and all of Asia will be wide awake, is also the dark of the moon - the most opportune time to fly undetected. And a 26 year old son-of-maniac in NK has Seoul in his nuclear sights ready for when the rest of the world is too busy with things going boom in their own backyard to give a shit what happens to SK. Taiwan only a fast few minutes away from China, who has been ready to go for years. Etc.

Two days left to get some physical PM in your hands. Monday may well be too late. But then, what do I know. TSHTF has been predicted way too often, and I'm sure there's nothing to worry about. Everything is no doubt under control. There's a good reason us old coots are called Jeremiahs. So Ho Ho Ho and Joy to the world.


JR Wed, 12/21/2011 - 19:56 | 2003019

Thanks for these details. The propaganda pushing for war has been especially obvious in the Republican primary campaigns with all major candidates, except Ron Paul, trying to outdo each other in promising Israel and the U.S. Zionists war against Iran. columnist Justin Raimondo today expertly disarmed the attacks coming on Ron Paul as he climbs in the polls. Here’s a key paragraph:

“The onslaught of pure hate unleashed on Paul, coming from both sides of the political spectrum, is rooted in his foreign policy views, which challenge the assumptions on which the entire structure of the ‘left-right’ paradigm is built. That mindset has served the War Party well: the ‘right’ gets to pretend it’s against ‘Big Government,’ whilst voting for massive military appropriations that ensure a steady flow of taxpayer dollars into the coffers of the military-industrial complex. This is the most lucrative form of ‘crony capitalism’ in America today, but you won’t hear any of the other candidates – including Obama – breathe one word about it. Only Paul calls for cutting loose the Empire and reducing our military budget to match the military’s new mission under a Paul administration: defending this country, and not the Empire.”

And Spielberg sets the mood for war with the release of "War Horse" on Christmas Day - for the children, “Rated PG-13 for intense sequences of war violence.” It seems like this Merry Christmas from Spielberg would have been more appropriate as a Hanukkah present in that Hanukkah represents a battle; is Spielberg trying to send us a message?


ParisianThinker Thu, 12/22/2011 - 03:04 | 2003620

The reason the US will confiscate your gold is because they want the army of beggars and useless eaters to die. Their plan is genocide.


swani Thu, 12/22/2011 - 06:30 | 2003690

One cannot mistrust the government to the extent that most people on this site obviously do, and then trust, that they will follow the law when it comes to individual property rights in a 'time of war'.

Both of these concepts are unfortunately mutually exclusive. All anyone has to do is look at what they are doing now even before they had declared the US homeland- a 'battlefield'. Look at how they have been confiscating people's property for years when they have been accused of a Drug 'Conspiracy' Crime.

Then, look at the NDAA. We have 2.4 million people in prison, and most, are imprisoned for non violent drug conspiracy crimes using RICO. Now, we are expecting to start locking people up for being suspected 'enemies' of the State.

While RICO, was not used on the Wells Fargo executives for knowingly laundering drug money. RICO was not used when the trustee, CME, and others, committed fraud by filing the MF Global bankruptcy under 'Securities Dealer' instead of "Commodities Broker", so that JP Morgan was allowed to confiscate the property of MF Global customers.

I mean, please. I know it makes us all feel better to think that something will be safe from this ever growing big goverment kleptocratic cancer that is metastasizing before our very eyes, but I fear that we are not. Not unless, we all start to resist what is happening, in whatever way we can; voting, boycotting, suing, making documentaries, writing stories, anything and everything that we can do, must be done. It is up to us and no one else.


AntiLeMaire Thu, 12/22/2011 - 06:49 | 2003702

Ceterum censeo OTC esse delendam.

It's good to see that Mark agrees with that motto. He is of course talking about the OTC derivatives, not the exchange traded variety. Simply because trading via an exchange requires margin larger than 0 and should remove the counterparty risk.

Imagine when the BIS (or US & EU) finally decide to require some acknowledgement of the huge risks involved in the current OTC derivatives positions of the banks. Say that one has to assume a minimal x% counterparty risk (total loss) & that any bank needs to have enough equity to be able to take such a hit...

To me it's clear where the banks really have to start deleveraging to lower the risks to 'the system': the OTC derivatives.

Remember this bit from 2002:

"Charlie and I are of one mind in how we feel about derivatives and the trading activities that go with them: We view them as time bombs, both for the parties that deal in them and the economic system.
Unless derivatives contracts are collateralized or guaranteed, their ultimate value also depends on the creditworthiness of the counterparties to them.
“Mark-to-market” then turned out to be truly “mark-to-myth.”
The derivatives genie is now well out of the bottle, and these instruments will almost certainly multiply in variety and number until some event makes their toxicity clear.
Central banks and governments have so far found no effective way to control, or even monitor, the risks posed by these contracts.
In our view, however, derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal."

Warren Buffet, Berkshire Hathaway 2002 Annual Report

Ceterum censeo OTC esse delendam


Gold Takes Out 200DMA...The Other Way (pdf) 12/20/2011

bob_dabolina Tue, 12/20/2011 - 23:22 | 2000035

Here's some food for thought.

Did you know that the emancipation proclamation was actually written by the largest slave owner in Maryland and that slaves on the border states like Maryland were never "freed"

Also, did you know that Abraham Lincoln not only wanted to free the slaves but his intentions were for them to be shipped back to Africa?

What's really funny about Obama is that he idolizes Obama even using Lincolns bible on his innauguration day. Goes to show how many American history books Obama read.

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Tue, 12/20/2011 - 23:27 | 2000045tmosley

You mean the original big government liberal was actually a racist, just like the vast majority of modern day liberals are?

Say it ain't so.


Mr Lennon Hendrix Tue, 12/20/2011 - 23:31 | 2000048

The Civil War was not about slavery. The War was about shedding blood. They wanted to issue War Bonds, and guess who did? The Banking Houses of Morgan and Delano. They wanted to sell guns and guess who did? Rockefeller. Then after the war, pretending to free the slaves, they mandated the constitution to read that corporations were people. The rest is HIStory.


Freddie Wed, 12/21/2011 - 00:58 | 2000163

Morgan was one of the Rothschilds errand boys.


Mr Lennon Hendrix Wed, 12/21/2011 - 01:07 | 2000171


or maybe he is in the Puritan side of the establishment along with the Pierces, Harrimans, Huntingtons, Russells....


thatguy Wed, 12/21/2011 - 02:17 | 2000242

"When the Jesuits were expelled from every Catholic country in Europe, their only refuge was Russia, Great Britain and the United States. Thousands of them flocked to this country to carry on their war against the Reformation under the banner of U.S. tolerance and freedom of religion for all. Among them were the Morgans, Roosevelts and German Roggenfelders. Roggenfelder was later changed to Rockefeller to make the name sound less German. Rockefeller was 22 and already wealthy when the Civil War began. He refused to enlist when President Lincoln asked for 75,000 volunteers. Like J. P. Morgan and the father of Teddy Roosevelt, he paid for a substitute to fight for him. He even refused his younger brother the measly sum of $75.00 to meet his enlistment expenses. His brother had to fight.....Rothschild controlled National City Bank of Cleveland gave him his first loan" But my real response is that everyone is one of Rothschilds errand boys in one way or another......I just remember reading this about John D. He times have changed.


wee-weed up Wed, 12/21/2011 - 01:11 | 2000177

“I will say then that I am not, nor ever have been in favor of bringing about in any way the social and political equality of the white and black races – that I am not, nor ever have been in favor of, making voters or jurors of negroes, nor of qualifying them to hold office, nor to intermarry with white people; and I will say in addition to this that there is a physical difference between the white and black races which I believe will forever forbid the two races living together on terms of social and political equality. And inasmuch as they cannot so live, while they do remain together there must be the position of superior and inferior, and I as much as any other man, am in favor of having the superior position assigned to the white race.”

-- Abraham Lincoln


Livingstrong Wed, 12/21/2011 - 02:53 | 2000274

If GOLD drops that much, to 1,000 USD, believe me, you will not be able to find coins. I would certainly would not sell my coins at that price. Gold will be horded and kept until prices start to spike up again. I confess, it would be nice if it dropped to 1,000 or less, I would buy tons of more golden beauties (coins)!


Tuco Benedicto ... Tue, 12/20/2011 - 21:33 | 1999812

That's what Gerald Celente says is coming in 2012. Go to bed Sunday night. Wake up Monday morning with fiat Federal Reserve Note devalued by, let's say 40%. There are haircuts and there are "HAIRCUTS"! It happened in Argentina in 2011 and it will happen here!

"If it is written on paper, it is worth the paper it is written on." Pastor Lindsey Williams


seek Tue, 12/20/2011 - 22:57 | 1999995

Happened in the US in 1933 as well -- 41% devaluation. And we were latecomers, Australia, New Zealand, Japan all did it in '31, and nine major currencies had devalued by the end of '33. This was the whole reason behind the gold call-in and issuance of fiat at a new exchange rate in the US. Now that we're floating, it's even easier to devalue. (And anyone holding gold is even better off.)


ebworthen Tue, 12/20/2011 - 21:59 | 1999876

PhD = Piled Higher and Deeper

MS = Master of Shit

BS = Bullshit


Ignatius Wed, 12/21/2011 - 03:17 | 2000293

"You may not like the fact that gold and silver are honest and natural forms of money." -- dolph9

Physical gold derives its real value as a 'wealth reserve asset' more than the fact that it can act as transactional 'money'. In fact, calling it 'money' distracts from its best and highest use which is as the preferred store of value. No matter what we understand -- or think we understand about gold -- the market will determine gold's value, not off-hand opinions such as Roubini's. Gold is the best store of value precisely because it has few un-substitutable functions, which fortunately means that it can be hoarded as savings without negatively impacting industrial commerce (think of the impact of hoarding oil, as an example).

Gold is simply the most internationally recognized and liquid wealth reserve asset. The fact that it is mid-rise of a massive re-pricing is what currently makes it a great investment vehicle. It's investment value will wane at a point, but not its wealth preservation (savings) characteristics.


Lamarth Tue, 12/20/2011 - 20:29 | 1999608

We have a disorderly collapse going on - the end result on gold may be reasonably clear, but the immediate direction of anything depends upon the forces immediately acting upon it. While I agree gold is going to be a major beneficiary long term, I wouldn't be surprised to see it collapse in the near term to levels low enough to shake out a lot of gold bugs. Until I hear terrified squeaks from those getting burned by the fall in gold I'm going to be very careful about buying gold. So far all I hear is defiant roars.


devo Tue, 12/20/2011 - 21:14 | 1999733

This sums up Roubini:

"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value. If there were, the government would have to make its holding illegal, as was done in the case of gold. If everyone decided, for example, to convert all his bank deposits to silver or copper or any other good, and thereafter declined to accept checks as payment for goods, bank deposits would lose their purchasing power and government-created bank credit would be worthless as a claim on goods. The financial policy of the welfare state requires that there be no way for the owners of wealth to protect themselves.

This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard."

--Alan Greenspan, Gold & Economic Freedom (1966)

Deflation = every bank fails.

Thus, gold.


Potemkin Villag... Tue, 12/20/2011 - 21:53 | 1999811

Ding Ding... We have a winner!


Inflation = They keep the ponzi going by printing enough worthless fiat for themselves to keep paying the coupon whilst skimming the profits & using the proceeds to stack physical on pallettes for the day that they eventually decide to blow it all up & want to play banker again...


Smiddywesson Tue, 12/20/2011 - 21:17 | 1999756

If gold ramps too high, the paper markets will decouple and it's game over, you won't be able to get any more, so you better buy into the ramp.

If gold sells off with the generalized ramp, they will have to step in and print at some point. There won't be any warning. You can't call that bottom, so you have to buy into the sell off.

For the first time in history, you don't have to use any brain power at all as long as you buy and don't sell.

Either way you win.


DoChenRollingBearing Wed, 12/21/2011 - 00:53 | 2000157

+1 Very good

I have been BTFSpike for over twenty years. Buy when you have extra FRNs. Feed the family, and preserve your wealth. It's very simple.

If you LIKE things more complicated than that, consider buying guns & ammo...


Hugh_Jorgan Wed, 12/21/2011 - 10:17 | 2000983

Sorry, but a "safe haven" is not something that is guaranteed to deliver 25% gains, annually. Why do so many educated people look at PMs the same way they look a a share of AAPL? Gold is a safe haven because it will never be worthless, unlike all the fiat currencies, bonds, warrants and any other BS security mankind dreams up. During the period we are entering, the previous "pillars" of our society are no longer trustworthy so we cannot expect a low level of risk when we invest in them. So if we want to preserve any wealth, we must treat anything of intrinsic value as the investement of choice. Land, food, guns, ammo, PMs and solid family/friendships.


Teamtc321 Tue, 12/20/2011 - 22:55 | 1999990

Deep, A little info for you below, enjoy.

Fed Provided $16 Trillion To Foreign Banks, Financial Houses

The U.S. Federal Reserve gave out $16.1 trillion in emergency loans to U.S. and foreign financial institutions between Dec. 1, 2007 and July 21, 2010, according to figures produced by the government’s first-ever audit of the central bank.

Last year, the gross domestic product of the entire U.S. economy was $14.5 trillion.

Of the $16.1 trillion loaned out, $3.08 trillion went to financial institutions in the U.K., Germany, Switzerland, France and Belgium, the Government Accountability Office’s (GAO) analysis shows.

Additionally, asset swap arrangements were opened with banks in the U.K., Canada, Brazil, Japan, South Korea, Norway, Mexico, Singapore and Switzerland. Twelve of those arrangements are still ongoing, having been extended through August 2012.

Last year, the gross domestic product of the entire U.S. economy was $14.5 trillion.

Of the $16.1 trillion loaned out, $3.08 trillion went to financial institutions in the U.K., Germany, Switzerland, France and Belgium, the Government Accountability Office’s (GAO) analysis shows.


trav7777 Tue, 12/20/2011 - 23:10 | 2000016

the debt can't be paid don't understand the mechanics of creditmoney if you believe this stuff can be paid off.

Japan is your example of what happens when credit saturates...the CB is forced to periodically print to fund the coupon because there is no organic growth in credit.

The national debt is just the tip of a credit iceberg, dude.


XenoFrog Wed, 12/21/2011 - 02:43 | 2000266

If even ten % of the derivatives hanging over the system are cashed in, that's 70 trillion. Your 50 trillion doesn't even cover a wildly optimistic bailout scenario.


CapitalistRock Tue, 12/20/2011 - 21:53 | 1999867

It will be amusing when the paper market approaches zero while the physical market scrambles with supply shortages and dealers each trying to figure out a price independent of the paper market. people will arbitrage the differences for a while. The cost to arbitrage will be the counter party risk ala MF Global. Then, suddenly, just when it appears all will improve, everyone steps out of the paper market at once. Physical dealers will then set prices twice daily instead of tying them to a futures market.

Fun times are ahead. Sell your fiat paper. Ben can't proctect its value.


2012 Gold Averages: Goldman $1,810/oz, Barclays $2,000/oz and UBS $2,050/oz (pdf) 12/19/2011

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Mon, 12/19/2011 - 08:05 | 1993656Thunder_Downunder

mmm.. banks bullish gold doesn't fill me with confidence. Especiallly when they all seem to agree...

So I guess this means we have another 4-8 weeks before gold finds its bottom again....?


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Mon, 12/19/2011 - 09:29 | 1993838Smiddywesson

"Who cares what gold does next year? I'm more interested in what gold does over the next ten years."

Yes, who cares what gold does before the system crashes. Now that we know that the system is doomed, they can't scare you with lower PM prices. Physical gold and silver are the only lifeboats. There are three scenarios for gold and silver.

1. Pain: If they don't print, gold and silver go down with everything else until the system crashes and then they skyrocket overnight.

2. Gain: If they print, gold and silver go up with everything else until the system crashes and they skyrocket overnight.

3. Down the Drain: The Fed steps in without warning and flushes the old system. If they announce a bank holiday and a new gold-referenced system, they can do what Roosevelt did and devalue the dollar by ramping the price of gold (something Bernanke said was on the table in his 11/21/2011 speech). In that case, gold and silver to the moon.

In all three situations, the only danger is not having physical gold at the end of the old system, or trading paper gold with the wrong mind set. You can lose your shirt trading paper in situation number 1, thinking gold has to rise because of fundamentals.

If I've learned a single thing over the course of this crisis, it's that when central banks agree and come up with jingles like "green shoots" or "pillars of support," they are about to shove those pillars right up your ass.

Looks like scenario one to me, lower prices ahead and a good opportunity to stack.



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Mon, 12/19/2011 - 09:54 | 1993916Smiddywesson

In theory, the availability of gold is no impediment to banks in devaluing their currecy. The could just announce a gold referrenced standard, and then manipulate the price of gold to the moon (ala Roosevelt). However in practice, central banks have to have a minimum amount of reserves to do business, otherwise they wouldn't be digging the hole deeper as they stall and buy up gold. They would have made their move already if they could.

The big questions are how much gold do they need before they take action, or how long do we have before a collapse forces their hands. I'd also like to know how deep a haircut the holders of currency are going to take, and who loses everything because of default, loan forgiveness, etc.

At this point all we know for sure is central banks are buying gold in anticipation of changing the way they do business and the holders of physical pms are the only ones who are not going to be harmed. Cash on hand for everyday use will be necessary too. The last time we played the old gold switcheroo, there were some very angry people. For example, the military were on hand with machine guns at Roosevelt's innauguration.






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Mon, 12/19/2011 - 08:23 | 1993683chinaguy

But, but according to Reuters: " Gold prices will fall below $1,500 an ounce over the next three months and are unlikely to retest September's all-time highs until later 2012 at the earliest, according to a Reuters poll of 20 hedge fund managers, economists and traders."


Mon, 12/19/2011 - 08:34 | 1993692Ignorance is bliss

Timeline is everything. A day late and you won't be able to acquire PMs at any price. Let's hope the financial games continue for a long time. We can never have enough PMs based on the on-going financial ponzi promoted by the Govt and the banks. My time horizon for wealth accumulation is well beyond 1-2 years. Do I believe I'll need PMs between now and possible retirement? I think so, just look at the dollar depreciation over the last 30 years. I will not let the Govt or the bankers rip me off any more then I have to. Save the 10 minute bullshit, I'm stacking for the long run.


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Mon, 12/19/2011 - 09:02 | 1993750RobotTrader

As usual

ES futures magically levitate

And gold and silver are lagging

But upon any ES selloff, gold and silver selling is magnified 3x at least.

TPTB has pretty much mastered control of all markets now with a flurry of paper.

- Stocks and bonds both up on the year.

- Commodities destroyed

- U.S. Dollar strong as an ox.

- PM's will probably close red for 2011.

Eric King and Jim Rickards are probably kicking themselves for not buying retail stocks, REITs and utilities.


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Mon, 12/19/2011 - 09:04 | 1993764LookingWithAmazement

Jim and Eric overlook sentiment.







Citi Predicts Gold At $3400 In "The Next Two Years", Potential For Move As High As $6000 (pdf)12/14/2011

MillionDollarBonus_ Wed, 12/14/2011 - 16:20 | 1980495

I have composed a draft letter to the white house expressing my concerns about this slow recovery. I just wanted to run it past you so you can tell me what you think:

"Dear Mr President,

I am writing to you as a concerned citizen. Despite my unwavering support for your administration and the values it stands for, I am increasingly agitated about the sluggish pace of this economic recovery.
I am worried that congress is cutting spending too much and too fast and that this is damaging economic growth and I strongly suggest that without further fiscal stimulus we could be headed for a double dip recession. What is the government doing to promote growth and create jobs? With due respect, I want answers and will not be satisfied with smooth political talk.

Yours Sincerely,


Just wanted to run this by you guys and see of you had any suggestions. I know it's pretty harsh but I'm really concerned that our government simply isn't doing enough to support this fragile recovery.


mrgneiss Wed, 12/14/2011 - 16:23 | 1980501

If you think deflation is here to stay, you'd better check your history.Deflation or inflation/hypyerinflation it is just a policy choice.

21 countries have experienced hyperinflation in just the last 25 years:

These countries have experienced severe deflation over the past 50 years:


Why does the government hate deflation and lower prices?

Because it lowers their tax revenues, it gives private citizens back their purchasing power (makes money more valuable to hold and save and invest) in their money and it lowers asset prices and other other consumer prices for goods and services we need and want.

Deflation does not allow governments to use inflation as a tax to steal our purchasing power (inflation is 100% pure government policy and is really nothing but an invisible, hidden government tax) and it lowers the taxes they collect on normal things like wages, property tax, etc.

This is one of the major reasons why there is so much effort by the Fed and Federal Government to try to re-inflate the housing bubble and to create inflation.

It’s in the government’s interests to create inflation (not too much inflation at once or too many people will wake up and realize and also dump the paper, fiat currency).

The bottom line is modern governments and central bankers have not allowed deflation to occur without first trying to interfere heavily in a country’s economy and markets and to first create inflation.

History is strewn with countless examples of interventionist policy by governments where the free market was not allowed to heal itself and purge itself of the bad investments and misuse of capital.

So if you believe deflation will prevail as Bob dabolina does, sure, sell your precious metals. If you believe as I do that printing to infinity will occur, hold onto them and buy on the dips.


mrgneiss Wed, 12/14/2011 - 16:49 | 1980623

Silver - the only commodity in the world still BELOW it's 1980 inflation adjusted and nominal high - I'm not worried.

Gold - just check out this chart for India - the story is similar for China and most other developing nations:

Dollar vs gold long term chart that even a trained monkey could extrapolate from:

long term dollar purchasing power:


Money 4 Nothing Wed, 12/14/2011 - 15:35 | 1980218

Money 4 Nothing predicts your not going to have to worry about 2 years from now.

Let's say it does, and your still here to use it, how 'bout paying 10 dollars for a gallon of gas, kinda levels that playing field huh?

Smiddywesson Wed, 12/14/2011 - 15:56 | 1980345

I hate to say so MfN, but I agree. I don't think the current monetary system has two years left in it either.

1. I'm wrong, they keep everything on an even keel and see a @20% increase in gold prices as has been the game plan of TPTB for years, or

2. The system starts to collapse and TPTB shift into End Game. That includes hitting gold with more than just the restrained attacks we saw today, because they are restrained, holding back just enough to prevent physical and paper from decoupling. Before this is over, you are going to see everything thrown at gold, margin hikes, rumors, proposed law changes, you name it, because at that point, the game is over anyway and TPTB are going to shake as many out of their positions as possible.

I see version two in the next few months. They can always print and forestall the collapse, but their willingness to print is in question because of Bernanke's stated game plan in his helicopter speech is to revalue gold, and THEN print. Don't listen to me, listen to the Bernank:

"The devaluation (of gold) and the rapid increase in money supply it permitted ended the U.S. deflation remarkably quickly."

So, now you know why they won't print prior to the revaluation of gold, and why the won't revaluate prior to them owning as much gold as possible. Therefore you are not going to get the kind of price appreciation you crave before the Bernank and friends finish buying, and that buying is likely to continue up to the brink of a total systemic collapse. The only printing you are going to see up until the point where they unveil the new system is the smallest amount possible to kick the can.

In fact, you are liable to get your heads bashed in as TPTB unleash a scorched earth policy in the PM markets immediately before announcing the revaluation of gold and super duper printing. I have cash in hopes of scooping up deals at this point, but I have physical in hand because nobody can time it perfectly and there may be no gold available to buy.


lewy14 Wed, 12/14/2011 - 16:04 | 1980408

I'm not a troll, gold or otherwise. Gold is my single largest long position.

Yet. What I have to admit, the real catalyst for gold will be QE3, and/or a putsch at the ECB resulting in massive EUR printing.

This is not happening, and there is no sign of it being imminent.

Therefore it is reasonable to assume that the liquidation of everything risk (gold, copper, oil, wood, stocks, credit) will continue.

Printing will happen eventually. But the central banks have set the pain threshold rather high this time, it seems.


Smiddywesson Thu, 12/15/2011 - 15:50 | 1984690

Yup, green for you. Confiscation is possible, but my GUESS is it won't be necessary. No act of perfidy would surprise me at this point, but my thinking is this:

They are kicking the can so they DON'T have to confiscate. If they wanted to confiscate, why wait while the gold bugs vacuum up physical?
There are no gold coins in circulation that need to be surrendered by the population like in the 30s.
Small regional banks, the targets of confiscation in the 30s are not sitting on piles of gold.
They can take your wealth through taxation as easily as through confiscation, so why promote a confrontation with people? Steal it from them or their heirs.
Rich connected people have gold, and they don't want it confiscated, however they can easily avoid tax laws, so confiscation isn't the preferred method to get the gold of the little people like us.
Small potatoes. Most Americans don't have any physical at all.


TheSilverJournal Wed, 12/14/2011 - 15:41 | 1980266

The entire banking system is on the verge of there's a rush into paper.

The entire western world is on the verge of there's a rush into government debt.

My only conclusion is that the world is made up of a bunch of masochists. As for me, I like pleasure and not pain. I choose to make sure I'm protected when all of this craziness implodes.


Quinvarius Wed, 12/14/2011 - 15:55 | 1980350

I think that for the most part, the system is incapable of preparing for an event that will end the system.


Zola Wed, 12/14/2011 - 15:49 | 1980316

I call BS and manipulation- the action in 2011 just doesnt make any sense. You can try to rationalize it all you want but fundamentals point to a rise in gold and fall in equities.


Strut Wed, 12/14/2011 - 16:38 | 1980572

Sorry, but “normal” fundamentals don’t apply in this type of market. In the world of nothing but IOUs leveraged 30, 50, 100x against inflated, near worthless assets, the only thing anyone can do is (fire)sell everything and get into cash safe havens. Values on everything will continue to fall until everyone finishes deleveraging.


hungarianboy Wed, 12/14/2011 - 16:14 | 1980463

I'm calling as low as $750 per ounce within 2 years for Gold.


Smiddywesson Wed, 12/14/2011 - 16:26 | 1980517

Me too, but only for a few minutes, then everything collapses, futures stop trading and they halt trading in the miners to halt "greedy speculators." The next day, gold will be revalued and the printers will start, and this blob will contain a lot of happy gold bugs.

In other words, if they push the price down too far, the whole system will collapse, and they will push it to the max when it all over anyways. I would.


ohhhhhbaaaaahhh... Wed, 12/14/2011 - 16:48 | 1980616

Im calling $15000 worth of value on gold, silver at $1500, and the collapse of paper late next year. Mmkay?

In Hungarian: Ne mondjál hülyeségeket ha nem magyarázod meg. Mmkay?


peekcrackers Wed, 12/14/2011 - 18:24 | 1980967

so that would make bread 500.00 milk 340.00 shot gun 5000,00 bullets 3000.00

beer 7000.00 ?

Dose that come down 50% on black friday ?


ohhhhhbaaaaahhh... Thu, 12/15/2011 - 04:17 | 1982430

No, sorry i forgot to mention not in a inflationary scenario. Bread would be normal todays price. So yes your numbers are wrong.


Smiddywesson Thu, 12/15/2011 - 16:00 | 1984762

"Im calling $15000 worth of value on gold, silver at $1500, and the collapse of paper late next year. Mmkay?"

I'm calling a $750 to $15,000 turnaround in one night. Nobody's getting on this train that isn't already aboard. (just kidding about the exact numbers, both numbers are likely to be far too low). And I would be very surprised if The Bernank waits until next Dec.


devo Wed, 12/14/2011 - 16:43 | 1980589

What would you guys suggest as the best strategy for someone holding physical but who wants to short gld for protection? I realize buying puts, but do I wait until vix drops? I feel if I buy a put now there's too much IV and I'll lose on both the physical and the put if gold goes down (assuming the Vix remains the same or lowers).


TheFourthStooge-ing Wed, 12/14/2011 - 18:34 | 1981005

If you're holding physical, the only protection you need is physical. If you fuck around with paper, you're going to get burned.

So gold dropped a little bit - so what? In 2008 it dropped from around $1000 to a little above $700. The Henny-Pennys panicked and sold. I laughed and bought a little more, and was happy that I got it for less than the $800 I last bought at.

If you have physical gold, you don't need financial protection. This isn't about trading, it's about investing. You'll be fine as long as you don't puss out.


devo Thu, 12/15/2011 - 02:53 | 1982374

Okay. But I got in pretty high (1700). I'm already taking it on the chin. It would be nice to offset it with options. Buying puts rarely works out, though, due to IV. Just wondering what ideas people had...

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Wed, 12/14/2011 - 16:43 | 1980592jmcadg

Waiting for JP Morgue to predict $100 silver


gdfghfdg Wed, 12/14/2011 - 16:44 | 1980599


It is a vicious game and you can loose you shirt.

The game is rigged and the house takes it all.


devo Wed, 12/14/2011 - 16:46 | 1980600

I knew gold and silver were in for trouble when JP Morgan purchased MF Globals stake in metals. I wrote about it in the comment area but nobody said anything. It would be nice if ZH could tell us more about that.


Smiddywesson Thu, 12/15/2011 - 16:13 | 1984839

If you believe that the system cannot be saved and that the petro dollar/debt based system of global trade is coming to an end, you don't have to hedge your physical.

If you think the central bankers of the world can somehow pull off a miracle and service the debt we have run up, AND untangle the $707 trillion worth of derivative, the leverage, and the hypothecation problems, as well as the aging of the population in a growth based economic world, then you should hedge.

My money is on the former and I'm willing to risk wearing a rain barrel for clothes based on my disbelief they can fix this. No way.


Gartman Flip Flops With Gold Support at 200 DMA at $1618/oz, And Massive Chinese Demand (pdf) 12/13/2011


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Tue, 12/13/2011 - 08:48 | 1973408Smiddywesson

The game for central banking is to kick the can and buy gold, while keeping gold within a trending range which has stayed at +20-25% for ten years.
So TPTB are not going to crush gold or let it ramp to the sky until this game is over, and it ain't over yet. They have plenty of margin hikes and fiat left to hold it down, and they have the experieince of driving it to $1534 and almost decoupling it from paper to remind them what happens if they get heavy handed.

Contrast that manipulation mechanism where MARKET forces drive gold prices lower without decoupling paper from physical as everyone sells everything and runs to the USD. In a general sell off, gold has no bottom, it can continue to fall without any adverse repercussions to the paper gold market at all as long as paper gold is not swimming against the tide. In a manufactured sell off like in Sept., there are limits the TPTB can achieve before damaging the paper price suppression scam.

Failing to understand the difference between these two situations can ruin you.

All of us must have a physical position for reasons of wealth preservation. Nobody can perfectly time the coming collapse so you are just going to have to purchase physical at what prices you can get. But those of us who trade in and out of the market have to understand, gold is still part of that overall market until the market dies. Ignore market sell offs, and you will lose your money. I think Widowmaker is right. There is going to be much lower prices before this is all said and done and then you will get your payoff in the form of a gold reevaluation. Until then, ignore the pain and preserve your paper for much lower prices.


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Tue, 12/13/2011 - 10:56 | 1974145Smiddywesson

Give up on family and friends. It's a trap. If they make money from your advice, they will forget it was your advice and think they are a genius. Worse, if they lose money, they will cash out at a low and blame you, then absolutely hate you when prices climb after they dump their gold.

If they have taken this much to convince, they don't have the intestional fortitude to survive the kind of volatility that is coming. You can't save them. I'm very sorry, I have tried and learned my lesson.

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Tue, 12/13/2011 - 11:15 | 1974255DoChenRollingBearing

+ 1 as usual Smiddy

Until a year or so ago I always tried to tell friends and family about buying gold as a wealth preserver through lousy economic times. A few listened politely, but only TWO actually went and bought some.

So I gave up trying. They all know my position anyway. I learned my lesson as well.

Great observation on how they might mis-time gold purchases and sales. Yes, they might sell to low and miss the huge spikes to come. And hate you for it.

Maybe you have to be BORN to be a fan of gold? The ones I helped convince were already dubious of our financial system and cynical of .gov and the banks...



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Tue, 12/13/2011 - 11:07 | 1974211Smiddywesson

That's a good level if the can is still being kicked. However in a big sell off, picking bottoms can be dangerous. If gold prices slide during a big sell off, scale in. You are unlikely to be able to buy when the bottom happens, it will be during the Asian session. More importantly, any drop in PM prices towards end game will be a slide off in prices, followed by a spike down and then a ramp from the bottom. Even before end game, it will become increasingly difficult to buy on the ramp, both because vendors won't sell it to you, dragging their feet and experiencing technical difficulties with their web sites, and because of the time compression of the ramp. At the very end, when PMs hit the bottom, there won't be any gold available at all. So you HAVE to buy on the way down and not call the bottom.

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Tue, 12/13/2011 - 11:19 | 1974281DoChenRollingBearing

My strategy of buying physical is similar, although I really do not let the price influence my buying decision. I BUY when I have extra FRNs. As income arrives, part goes to gold.

OK, if there has been a big spike down, I *may find* a little extra income to buy...

Please note that I have bought some 85% of my gold at or near *record highs* through the decades, and it has worked out very well.


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Tue, 12/13/2011 - 08:30 | 1973359moonstears

Just as the Market dropped like a rock in 2009, only to rebound nicely, for the swift (see SLW as example), I'd buy PHYSICAL PMs, a little now, and alot on the paper collapse, if physical's available, at those prices. This you forgot to discuss. When silver hit $9 in late 2008, I bought a little, at $13...a 33%+ diff for physical purchase.


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Tue, 12/13/2011 - 08:25 | 1973353Quintus

Can you provide a single example of when Gold and Silver have crashed during a deflationary episode? Just one will do.

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Tue, 12/13/2011 - 08:41 | 1973390Pladizow

I know that during the 30's, the two largest miners had gains of 500%.

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Tue, 12/13/2011 - 08:52 | 1973433Flakmeister

Yes.... there was a gold standard at the time though....

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Tue, 12/13/2011 - 09:45 | 1973674Smiddywesson

Yes, when using the 30s as an example, we can't forget about the effects of going off a gold standard on the market's sentiment, the fact that politicians were running around parroting Keynes' drivil that gold was a barbarous relic, and the fact that they revaluated gold, and made it illegal to hold. This skews all your data, which of course, is exactly the shadowy misdirection central banking is designed to bring about. So when someone says "deflation does this and that is that," take care. It's not that simple.

Last time around, it was in the Fed's interest that the dollar be devalued, so gold had to go up, but that was their line in the sand for gold prices. This time around, they are stacking gold, they have tremendous liabilities, foreign currency reserves are no longer acceptable to balance your trade, so all that is left for them to remain solvent is to ramp the price of their one remaining asset, gold.

Bazooka is right, gold will fall in price during the sell offs. But that process can only go on for so long before the system crashes and PM holders get the big payoff.


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Tue, 12/13/2011 - 08:57 | 1973451Quintus

Indeed - and since the price of gold was officially fixed by the government (unlike today's unofficial price management) and then confiscated, miners were the closest the average investor could get to finding a safe haven in gold during the great depression.

I guess my initial comment is a trick question since there has never been a deflationary episode under the fiat currency system. There can't be if the system is not to crash completely as debts rapidly become unpayable and the fractional reserve system collapses.

Think Japan has had two decades of deflation? Everyone says they have. Try going to Tokyo and offering to pay the 1990 price for a meal or a taxi ride, or indeed just about anything but property. This Japanese deflation sure looks a lot like inflation.

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Tue, 12/13/2011 - 09:20 | 1973559Smiddywesson

Gold and silver prices go down in a delation just like everything else, but they still outperform other assets. More importantly, this is not just a deflation, this is a debt induced and leverage induced collapse, so our models about what happened in the 30s are only relevant up to, but not including, the collapse. A collapse will destroy all paper and leave gold and silver as the only survivors. References to the 30s also have to recognize that gold prices were set by the government, something Bernanke said you would do to battle deflation.

So Bazooka is probably going to be proven right. Up to the collapse, gold and silver will sell off with everyting else. I think they will recover between bouts of sell offs, but it's likely our wives will be very dissatisfied with our investing skills as our stash loses worth in fiat terms. It's going to take a lot of intestional fortitude to hold on for the collapse, especially if your cost basis is over $1600, but at this point my stash is insurance for wealth preservation and I'm keeping the rest of my fiat ready for the big sell off. I definitely am not trying to capture the bottom in gold price, it will happen in a fraction of a second, probably during the Asian session, and then boom, prices will respond to paniced buying. In this, my last remaining position in physical, I am scaling in as we approach the collapse of the system.

The problem with the deflationists is their argument assumes the system survives the crisis. I have no faith in that assertion due to MF Global, $707 trillion of derivatives, political ineptitude, and war being in the self interest of Russia, China, and the USA. We are going over the cliff, so all historical examples are of limited use.

My advice for what it's worth: Establish a core physical positon, sit in the USD with the remainder of your money until the great deflate, scale into lowering PM prices, accept that you won't catch the bottom (and sleep like a baby)


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Tue, 12/13/2011 - 09:56 | 1973745Smiddywesson

When somebody says that an asset that represents less than 1% of a portfolio managers position is the biggest bubble in history then they look like the biggest fool in history.
Bwahahaha. Yes, they are desperate and their lies are becoming more transparent.

They are buying gold.

They control the system.

They are not going to let you feel any love before they get what they want, especially because this will invite more traders to compete with them for the available gold.

Therefore, you are not going to get the kind of price appreciation we all anticipate until the central bankers make their move. In fact, they will use their remaining margin hikes and unlimited fiat to shake us out of our positions in physical and paper if they see the end coming.

Most gold bugs have the mindset backwards. If all goes according to plan, gold will continue to climb 20%-25% each year as central banks slowly acquire gold. However, if the system begins to fail, gold prices will naturally go down as thing sell off, maybe with a little help from our central banker friends, who will really attack PM markets if the jig is up.


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Tue, 12/13/2011 - 10:03 | 1973809Smiddywesson

I don't think you are going to see a basket of commodities backing currency. The banksters have no intention of handcuffing themselves. We are likely to continue to have fiat currency for domestic trade, but all international trade deficits must be settled in gold, not the USD. FOFOA describes this as a primary and secondary system and it makes a lot of sense. Not that the NWO people wouldn't mind having one world currency, I just think they waited too long to pull it off.

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Tue, 12/13/2011 - 11:40 | 1974404DoChenRollingBearing

+ 1

I too believe that FOFOA has the right idea: that we will use a paper currency backed with essentially nothing and use gold to store accumulated wealth. I do not recall reading that FOFOA says that international trade deficits (debts) will paid off in gold (maybe it´s my 55 yr old brain not remembering), but that is certainly plausible.

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Tue, 12/13/2011 - 12:55 | 1974739omniversling

a worthwhile read:

"When a currency system comes to the end of its reserve use, I'm speaking politically, its domestic market will come to a point where it can no longer export "real price inflation" in the format of; "shipping its excess currency outside its borders". This happens because internal money inflation, that is super currency printing, is increased so much that it overwhelms even its export flow. Worse, even that export flow later tumbles as the fiat falls on exchange markets."

"The effect is that local "passive inflation", built up over decades and fully reflected in "Sir John's" paper assets, spreads out as "aggressive inflation" and hyper price rises begin. In this action, the very same wealth effect that was eventually priced into "John's" Dow stocks and other assets, begins a long march of being priced into real gold."

"Anyone that has accumulated physical gold over this past long period was doing the exact same thing Dow buyers of the late 60s and early 70s were doing: ------ saving "wealth" as unpriced "virtual wealth" stored up over that "passive inflation" period. ---"


"Remember; in political inflations, money is printed to save the assets as they are currently priced… This paper gold market will be cashed out at prices far below real bullion trading so as to inflate further the books of the Bullion Banks,,,,,, not destroy them. At least this is how the US side will proceed."







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Tue, 12/13/2011 - 10:35 | 1974040Smiddywesson

If they don't have a core stash already, even if it's just a small percentage of their money, they are stupid.

This can go either way:

Scenario One: Central banks would love to keep the can kicking, letting gold appreciate @25% a year for as long as they can while they stack at low prices. In this scenario there's no great sell off and currencies are slowly debased while gold continues to slowly rise.

Scenario Two: The system will break down, or paper will decouple, or there will be a war, and the great selloff will take gold prices down as the tide goes out. Then, central banks will try to shake everybody out of gold before they buy gold like crazy. In this scenario, gold prices go down (and perhaps crash in the final hours/days) before central banks step in to revaluate gold to the moon.

Scenario Three: Crisis sets in and gold prices climb while everything else sells off. It hasn't been my observation that this is how the real world works. Gold prices are being held down by the system, and until that system breaks completely, gold will remain part of that system and sell off with it. Sure, the fundamentals are so strong that gold always comes back, but that doesn't mean it is immune to lower prices as we have been taught over and over.

Bottom line: We have been stuck in scenario one for years. I believe scenario two is the rest of the story. I can't see gold escaping the price suppression scam until the system collapses, because the price suppression scheme IS THE SYSTEM. Hold onto your hats if stocks begin to crash.



Guest Post: Why You, They And — Hell — I Might Just Buy That Parabolic Move In Gold... (pdf)

pakled Wed, 12/14/2011 - 19:00 | 1981093

My take on this post and others along the same vein today (subject to change as I learn more):

1) gold (& silver) are stores of value. Always have been and always will be (until alchemy perfected. Remember that old Twilight Zone episode?).

2) gold (& silver) can be traded for goods/services, but [favorably] only under certain circumstances.

3) therefore 50% of my emergency-double-secret dystopian crash bag of tricks is FOOD, and the means to cook it. (and supplies and medicine and seeds)

4) some of that 50% are redundant quantities to be offered for barter

5) must not forget dangers of relying on only gold (&silver). Possible scenario:

a) government makes gold (& silver) illegal to own. Perhaps confiscates for the patriotic purpose of backing a new currency

b) lest you try and barter with gold (&silver) on the grey/black market, government offers reward to your neighbor for turning in such a 'terrorist'. Reward is an offer the neighbor 'can't refuse', like increasing their food ration. How so? Monthly threshold on their safeway (albertson's, ralphs, costco, kroger, et al) will be bumped. How so? All food purchases, do to shortages, and to be 'fair', will require these cards. No hoarding! That is an act of terrorism and we have a place for such types.

6 No way around acredited grocery stores because all mom/pop farms will be illegal (we are actually just about there now on that one).

7) Go ahead and protect your stash with a gun, if you so choose…..but you damned well better have walked through that scenario and be absolutely clear you are prepared to take a life to protect you and yours… or you would be better off trading the gun for food/supplies. Gun or no gun, keep your mouth shut about your stashes, whatever they are, and do some favors for your neighbors, starting now.

8) inflation vs deflation: I refer to some rules I have learned in the school of hard knocks: a) to the degree you are absolutely, positively sure it is going to be ‘A’, by that same degree it will more likely turn out to be ‘B’. b) the longer a prediction is in effect, and the more people that buy into that prediction… the less likely that prediction will manifest as predicted.

9) Inflation: Printing money (monetary inflation) does not in and of itself cause price inflation. The trillion dollars you print in your basement (if u could) has zero effect on inflation if it stays in the basement. It must circulate. A key factor to price inflation (or deflation) is ‘money velocity’; how often money exchanges hands in a finite period of time. This is why Helicopter Ben has threatened to circumvent the I-don’t-trust-you-enough-to-loan-you-money banks, and hand the money out directly. You must get people to spend.

Hyperinflation is more a psychological event than a monetary/political event. It happens when a critical mass of the populace become fearful that they must spend TODAY, because prices will be higher TOMORROW. Once at critical mass the fear feeds on itself until the currency is fully consumed. I have a Zimbabwe 100 Trillion dollar bill on my mantle to remind me of that. Best as I was able to figure it bought 2-3 loaves of bread at the end.

But, timing is everything! We will likely get both, but in which order? Inflation is an unstoppable force meeting an immoveable object (deflation). The grand tug of war. We can take a good guess at the end game, but we don’t know how this will play out in the meantime because there are too many moving parts. For example, if people stop spending will we enter spiral deflation, or will direct government spending on food stamps and war overtake the downward momentum of trillions of dollars in derivatives and loan defaults unwinding? I personally am planning for biflation; the things we absolutely need will cost a lot more… and the things we don’t absolutely need will call cost a lost less. But as a wise old man once said, “Difficult to see the future is. The dark side clouds everything”.

Whatever we do let us be sure we are prepared for the endgame. Don’t let this day-to-day crap throw you off your game (gold (& silver) seem to thrive in either environment (inflation/deflation) in terms of purchasing power, so it seems they should be part of a complete breakfast regardless).

And, even the end game is uncertain. We may be living at the most ‘interesting’ time in this round of human civilization. We are rolling over to a new age, and that means that past history may be less of a guide then some people think.

On top of everything else we must try to convert our fear to love, as we are able (fear is the ‘mind killer’). Those are the two options that are REALLY in play here.


DeadFred Thu, 12/15/2011 - 00:31 | 1982225

Yet there is usually a clear reason for the corrections. This one is perplexing. Gold goes down either because they holders (of paper) don't want it or because they have to sell. The only reason I can think of for why they wouldn't want it is because they are front running some unseen deflationary event or margin rise.

Margins are unchanged so the only reason I can see for the holders being forced to sell is an acute need for cash. Why? Euro banks are about to fail? France is about to be downgraded? Someone found the tungsten bars in the GLD vaults? Iran is about to be attacked?

Someone is front running something big and I can't puzzle it out. Something is up.


Al Huxley Thu, 12/15/2011 - 00:48 | 1982256

Margin calls on paper speculators, same as 2008.


Treasury Continues To Dip Into Retirement Accounts, Prepares To "Take Out" $66 Billion Chunk To Make Room For New Bond Issuance (6/2/2011) (pdf)

Lol that is truly insane thinking.

As far as government spending is concerned, at this point in time you would have to be crazy not to think that the gov is screwed. If the government were an individual applying for credit, they would have been denied long ago. At the point the government currently is at is like they are applying for new credit cards to pay off old credit cards. They are switching very fast each time to try and pay off the old credit card but each time they switch the pay out period shortens.

I've often wondered as a kid how the world could be at such peace with each other when there used to be such horrendous acts like world wars, genocide and slavery. Then later I realized all these things exist but are just subvert. Slavery exists just as much today but it is in the form of debt and financial slavery. Pay a person substandard wages and let them become indebted to you and you guarantee they will work for substandard wages for the rest of their life. Let them go spend 4 days a year at a tropical paradise and then go back to working their sad existence of a life. Meanwhile you can enjoy the fruits of their labor while making exponentially more money than them. The system is screwed and it's finally coming down. The only bad thing is that the system that comes to replace this system will most likely be even worse.


Henry Chinaski
smells like... wealth confiscation


I just want peope to understand that this is a defacto nationalization of CONTRIBUTED FUNDS to the TSP G FUND, not a future promised government entitlement or defined benefit pension plan. This is straight up thuggery.

Amish Hacker
Oh, you mean kind of like the Social Security Trust Fund?


401K's and IRA's are next - especially the "employer" contributions, even though it was a part of your contract.

I had a TIAA-Cref punk try to guilt me about my 401a becasue I was talking about "my money" and he says "but the state put it in there for you" Grrrr "Yes, kind of like my paycheck and cheap ass insurance that is part of my employment CONTRACT." I would have smacked him through the phone if I could.

They will take it or limit any withdrawals to where you can't really get it - and it will make the 10% IRS penalty seem downright friendly in comparison.


It's not my debt. And I'm not paying it.

The Fed owns you. It prints the money, loans it to government, then the government points a gun at your head to force you to produce real goods to generate every dime they will give back to the Fed to 'repay' for the printed paper.

At the end of the game, the bank ends up with title to all the property, and your offspring are slaves to the state which is owned by the bank.

The debt cannot be paid back, that is never even part of the question. It is out of the question. The PURPOSE of the debt is not the spending, the proceeds of which end up as sludge at the bottom of the separation tank at the sewage plant after the recipients consume it. The purpose of the debt is your bondage. And your childrens' bondage.

Repudiate the debt. It was spent to rule over you, and it will be used to suck the life blood out of your standard of living until you die.

The U.S. government might not be willing to repudiate the debt. But WE can.

A boot stomping on a face, forever.


"It's not my debt. And I'm not paying it."

Right on, friend. Why do I almost never see anyone making this connection?

Question though -- just how do you figure "WE can" repudiate the debt? It's not like our votes count, or anything like that...


Unfortunately, WE may have to go arborist on these tyrants.

This is the point of the Federal Income Tax in particular missed by all-too-many.

You'd think the owners would be more prudent to ensure a stronger middle class in order to more easily skim off their earnings, find a way to write down the balances, and therefore maintain their strangle hold on control.

Call it balance or equilibrium.

But no, the financial system appears to be set for abandonment like one of those huge drills used to dig the Chunnel.

It really seams that a paradigm shift of some ugly, major sort is underway.


"Soft patch"... my ass!

For the last month or more, as each economic number has come out weaker than the last we hear Washington, Wall Street and their bought and paid for media describe the current situation as a "soft patch".

In reality what we are experiencing is THE END of a credit based system that can no longer create credit fast enough to keep the balloon in the air.

Why did the Fed and Treasury need to put their balance sheets on the line in 2008? Why the need for QE1...2... and soon to be 3? Because the system has reached "debt saturation" and cannot grow on its own. There are now no entities left with the ability to borrow more debt (create money) so that past debt can be serviced and paid back.

Without more debt there can be no growth, in fact we have reached the point where debt needs to grow exponentially just to "run in place" and keep the system from deflating.

The problem is that there are no "good credits" left with both the ability and desire to borrow more.

This so called soft patch will turn out to be the same bullcrap as "green shoots".

The official story was and is hogwash but "we" had to wait for the green shoots to be proven wrong, this time it won't take as long and THE PANIC may very well be initiated by TPTB who want to front run the sheeple and get the hell out of town.

The end game has clearly arrived and "hyper stagflation" appears to be the result.

Financed assets imploding in value at the same time the currency self destructs.

The worst of all worlds. It sounds that way because IT IS!

Never in history were governments included in the debt trap we are in today on such a grand scale. There is no "savior" who is/will be able to ride in and save the day. that is what governments did in 2008 only to bury themselves under a mountain of debt. Now we just sit and wait to pay the price and endure the pain of 100 years of unsound monetary and fiscal policy.

We are in a position today that was a 100% sure thing years and years ago. The amount of debt that a system can carry and endure is finite. We have already passed that point and unfortunately it is downhill from here.

This is not a "soft patch", it is a financial death trap!


Tic tock
What I would do, is simply call the FED 'the bad bank', suborn its powers into the Treasury and dissolve the institution. By anulling the FED balance sheet, there are a lot of rather interesting instruments which simply cease to exist, including a fair amount of Treasury debt....the logic is, without the Bernanke Put and with a number of banks somewhat short of dollars, there's a reason to hold dollars. Okay, maybe the financiers ahve to work a bit on what to do...eventually one of their friends will lend them money to play with.

..and housing, just put the whole mortgage market under FNM, FDM at 2% for 30 years.


I happen to be a federal employee with the majority of his retirement funds in the G fund. This makes me furious. Look, first of all, I am in the G fund for principal preservation, not growth. I think I make around 3%. Mr. Geithner, what is it about principal preservation you do not understand? What you have done is to place some of that principal - MY PRINCIPAL - at risk without offering me a risk premium. This is commonly termed theft. I will not hire a lawyer and sue you if you indemnify me with secure capital - or - perhaps your home. Do you understand me?


Principle protection in US Treasuries? An oxymoron. We'll see what the full faith and credit of the gov is worth.

Oh, and my standard question: why does a sovereign government borrow its own money from private corporations - at interest?

Hint: it doesn't need to. We should repudiate the debt.



What better way to create parties interested in raising the debt ceiling...then to hold over their heads the destruction of their retirement accounts. Sounds like constituency building to me.

hound dog vigilante
"Sounds like constituency building to me."

They already have public unions over a barrel, which makes this a risky move, imo. The longer this drags out, the more this move backfires.


Tic tock
It does raise the issue though, y'know, we all play the markets - yes, it's beyond insane that a large part of global asset-pricing is such a crapshoot, but that's the way things are. But look, its always between two sides, most of the time the giants win, very occasionaly the sprats win. And that's what's happened; several recessions later, whatever, what are the ginats doing - they've become cannibals, they're changing the rules on a daily basis, they're contradicting themselves, they fear the market. They stand in its way, super-cell tornadoes, nuclear disasters rain down. ...really, if you can't stand the heat,


Fuck you geithner. I'm cleaning-out my 401K this month. As a Federal employee, you can suck on that timmy.


I don't feel bad AT ALL if government workers don't get paid their retirement. In fact, I don't care if anyone gets paid anything. Somehow, borrowing/printing another 2 trillion, or 3 trillion, or 5 trillion is really going to lead to an alternate outcome right? Yea....if you believe that, I have a bridge to sell you.

This is what America gets. You've borrowed, and printed yourself to a level gluttony and sloth. The fruits of the public treasury has been raided to fund unrealistic pipe dreams by people obsessed with the largess delusion of perpetual wealth on the back of no work

America has become an entitlement country which has grown accustomed to cashing checks it's productivity can't back.


Maybe 'they' are dipping their f*ckin grimy crungy dirty little fingers into these retirement accounts...because these people(some?most?) WONT reach retirement...(err, 'make it' to that day because bad things are going to happen way before 'retirement')

Ya dig what im sayin?


"This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. If one grasps this, one has no difficulty in understanding the statists' antagonism toward the gold standard." ~Alan Greenspan


Hook Line and S...
I wonder how this article in particular is affecting the worker satisfaction and overall morale of .gov paid disinfo agents...












Dow 20,000 Or Bust; Or How James Altucher Stole Birinyi's Ruler (6/3/2011) (pdf)

I agree - DOW 20000 GOLD $20,000. I think he's a bit low actually, I think DOW 54000 GOLD $54,000. WTF is the DOW measured in? Ohhh... it's USD. ... I get it now....

The best and easiest way for countries to increase GDP is to PRINT MORE FUCKING MONEY!

Remember this?: C + I + G + X − M = Y(GDP)

Therefore SPENDING = GDP, therefore PRINTING = GDP. The more we print the MORE WE PRODUCE = BETTER we are; according to Keynes. Where is Keynes - I want to piss on your grave you mo-fo! @@@##@#


I am sure the Zimbabwe stock market saw some (phe)nomenal highs, too. If I remember correctly, they had some 200-300% up days!

Measure everything in gold to get a true price at this time (btw, gasoline is cheap priced in gold).


The multiplier is BS as it depends on credit to have this theoretical effect. When I borrow $600B to buy donuts; the most the donut guy can buy in newspapers is with what is leftover after costs. All of "multiplier" roots to credit and James forgets to mention the pile of debt building up in the closet which when rates go up will wreck the economy. I made this video about James:

The Asset Management industry is in deep trouble if people turn to gold and silver; they will lose those management fees and free money to put into ponzi schemes. Yahoo Tech Ticker, CNBC etc are all paid for by advertising by the Asset Management Industry


Bendromeda Strain
The multiplier is a transitory phenomenon that exists during a finite period of debt expansion. As was shown over a year ago, debt saturation has finally inverted the multiplier.


"soft patch"...the memo's gone round...

soft. patch....and suddenly it's like the economy is tiptoeing through a field of creamed corn....


See!! I told you guys those Two HUNDRED Trillion Zimbabwe Dollars I have proves this guy is the most extream financial genius of all time!!! Damn!! I KNEW I was rich when I took both of those bills to pay the property taxes and I'll be damn if they didn't just laugh at me! Fuckerz! I guess that DoW 20,000 was more important than the FACT that those two bills are nuthin but ass will be FRN. I wonder what boy wonder here will be touting then? Pet Rocks? Beanie Babies? Maybe I-pad bling! Oooo.. sparkly..very sparkly!


He could be right, for the wrong reasons.

In January 1922, the Berlin stock exchange index was 743, by December it was 8981, a rise of 1200%. If the USD were to hyperinflate in a similar manner, the DOW would reach 145,000.

A more recent, and less dramatic, example is the Argentinian crisis of 1999-2002. As the crisis unfolded, and before captital controls were in place, the stock market rose ~217%. This would translate to a DOW of >26000.

It should be noted that the top 5% of wealthy people in Argentina did just fine, picking up antiques, cars and silver at bargain basement prices as the poor and middle class sold their possessions for food.

You can bet there will be another massive transfer of wealth in the United States in the next 12 months also.


"I loved this convesration. It was nothing but positive"

Exactly, CNBC is nothing but a kool-aid drinking stock promoting shill outfit.

What's it been, two and a half years now we've heard about "green shoots" from these clowns? And the run up in gold has been a "bubble" for the last ten years.

Oquities Sat, 08/27/2011 - 13:49

logic and my spidey sense tell me that we will most likely have hyperinflation particularly if preceded by an acute form of deflation, the ongoing deflation in housing notwithstanding.  the deflation i'm thinking of is of course the popping of the debt bubble previously forestalled.  many of the bank bonds (which make up most corporates), along with agencies and sovereigns must be marked down from fantasy to market-based reality.  so first the haircut, then we overpay the barber.


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