“Well, do you feel lucky…...”

Baltic Dry Index. 2928 +17
LIR Gold Target by 2019: $3,000.

“There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.”

Ludwig von Mises.

Will the great Austrian economics economist be wrong? Is there a means of avoiding a final collapse? Are we headed for “a final and total collapse of the [fiat] currency system? So far in our collapsing bankster casino capitalism corrupt system, “Plan A” has been to bailout the banksters and some of the larger auto manufacturers, by massive Quantitative Easing by the global central banks lead by the Fed, and to suspend real accounting for banks and return them to fantasy mark to the model accounting that largely got them into trouble in the first place. We intend to solve the problem of the collapse of a boom brought credit expansion [and massive Wall Street fraud,] by the gigantic uncertain gamble of a massive credit expansion at the central banks. More of the same will apparently save us, provided only that the credit expansion takes place at the central banks. The great Nixonian error of a world anchored on a fiat dollar reserve standard gets ever more bizarre. We must save the sinking Titanic, which incidentally struck its iceberg 97 years ago today, by flooding the Titanic with even more water. Stay long precious metals, and the better run companies that mine them or explore for them, against the day when even the doziest Keynesian economist can see the final catastrophe into which they have lead us.

Below, the IMF smells a rat. Something or some country bigger than Greece also need a bailout, apparently. Step forward, Great Britain, Japan and Uncle Sam? I suspect that behind the central bankster’s curtain, another Lehman crisis is already appearing.

"Everything has been thought of before, but the problem is to think of it again."

Goethe"


IMF Executive Board Approves Major Expansion of Fund’s Borrowing Arrangements to Boost Resources for Crisis Resolution
Press Release No. 10/145April 12, 2010
The Executive Board of the International Monetary Fund (IMF) today approved a ten-fold expansion of the Fund’s New Arrangements to Borrow (NAB) and the transformation of the Fund’s premier standing credit arrangement into a more flexible and effective tool of crisis management. The NAB will be increased by SDR 333.5 billion (about US$500 billion) to SDR 367.5 billion (about US$550 billion), representing a major increase in the resources available for the Fund’s lending to its members.
http://www.imf.org/external/np/sec/pr/2010/pr10145.htm

Below, the ever alert and always interesting Karl Denninger has noticed a massive one week surge in the Fed’s outstanding loans and leases.

"It is hard to believe that a man is telling the truth when you know that you would lie if you were in his place."

H.L. Mencken

Did The Fed Just (Surreptitiously) Bail Out Europe?
No, not just Greece - all of Europe. Without Congressional authorization or notice, of course.
Hattip to a nice emailer....

That nice little vertical line is a gain of $421.8 billion dollars of outstanding loans and leases in one week's time.

WHERE THE HELL DID THAT MONEY GO AND WHAT COLLATERAL WAS TAKEN AGAINST A FOUR HUNDRED BILLION DOLLAR INCREASE IN OUTSTANDING LOANS?

You won't find anything like that in the records - because it's never happened before. That's beyond unprecedented, it's ridiculous, and assuming it's also accurate, someone has some 'splaining to do on what clearly appears to be some sort of back-door game being run.
http://market-ticker.org/archives/2186-Did-The-Fed-Just-Surreptitiously-Bail-Out-Europe.html

Something is definitely going on, and it’s a good assumption it’s going wrong. The crooked central banksters are acting like the next Lehman has just shown up and they are in a Keynesian panic. Did China just tell US Treasury Secretary Geithner to shut up and pay his taxes?

Below, what all the western central bankster credit expansion is achieving in Asia. All fiat money is fungible and money flows to the scene of greatest return, but great return incurs great risk. While the west’s economies languish and advance towards a Greek or Iceland like fate, the far east is booming like there is no tomorrow. Some in the IMF and the Fed apparently agree, there is no tomorrow, apparently, they think the next Lehman is about to show up.

“Money has no country.”

Jules Bertillon. A House of All Nations. 1938. Christina Stead.

China May Post 11.7% Growth, Adding Pressure on Yuan
April 14 (Bloomberg) -- China’s economy may have expanded 11.7 percent in the first quarter, the fastest pace in almost three years, making officials more likely to raise interest rates and scrap the yuan’s peg to the dollar.

The median estimate in a Bloomberg News survey of 24 economists compares with a 10.7 percent gain in the previous quarter from a year earlier. The statistics bureau will release the data in Beijing tomorrow.

Singapore will undertake a one-time revaluation of the nation’s dollar, the central bank said today, as Asian policy makers counter rising inflation pressures. China, accused by some U.S. lawmakers of holding the yuan’s value down to secure an unfair advantage in trade, is likely to let currency gains resume by June 30, a Bloomberg News survey of economists showed.
http://www.bloomberg.com/apps/news?pid=20601087&sid=aSGGAZJoLGJI&pos=6

Foreign trade recovers to pre-crisis level in S China's Guangdong
GUANGZHOU, April 14 (Xinhua) -- Guangdong Province, a major economic powerhouse in southern China, reported a recovery in foreign trade to the pre-crisis level in the first quarter of this year, according to data released Wednesday by local customs house.

Between January and March, Guangdong's external trade amounted to 153.2 billion U.S. dollars, a growth of 32.7 percent on the same period of last year, or up 1.9 percent on the same period of 2008, which was prior to the global economic downturn.

The total included 85.93 billion U.S. dollars in export value, up 21.2 percent year-on-year, and 67.27 billion dollars in import value, up 50.9 percent.

The export volume accounted for 27.2 percent of the nation's total, while the import volume made up for 22.3 percent.

However, the province's foreign sales failed to recover to the pre-crisis level, due largely to increasing production cost, slow recovery in demand abroad and trade barriers on international markets.

Guangdong's export value in the first three months of this year was still 1.2 percent lower than the level in the pre-crisis period of January-March 2008.
http://news.xinhuanet.com/english2010/china/2010-04/14/c_13250691.htm

China’s March Property Prices Jump a Record 11.7%
April 14 (Bloomberg) -- China’s property prices rose at a record pace in March, indicating government efforts to stem gains aren’t working and more drastic measures may be needed amid concern of a bubble in the nation’s housing market.

Residential and commercial real-estate prices in 70 cities climbed 11.7 percent from a year earlier, the National Bureau of Statistics said on its Web site. The data goes back to 2005.
China has raised mortgage rates and re-imposed a sales tax on homes in the first two months of the year to reduce the risk of asset bubbles. The government announced in March developers will have to pay a higher deposit for land purchases and banned banks from lending to builders found to be hoarding land or holding back home sales in anticipation of higher prices.

“The data is bad news,” said Dariusz Kowalczyk, chief investment strategist at SJS Markets Ltd. in Hong Kong. “This means that monthly price gains are accelerating again after slowing to a four-month low of 0.9% in February. Expect further policies to slow the real estate market.”
http://www.bloomberg.com/apps/news?pid=20601089&sid=aUxoV_4Y3aoE

Singapore Dollar, Asia Stocks Advance as Recovery Accelerates
By Shani Raja
April 14 (Bloomberg) -- The Singapore dollar strengthened the most in a year against the U.S. currency and South Korea’s won jumped after government reports showed accelerating economic growth. Technology shares led a rally in Asian stocks after Intel Corp.’s sales forecast beat analysts’ estimates.

The Monetary Authority of Singapore revalued its currency, sending it 1.1 percent higher against the dollar to S$1.3782 as the government said the economy will expand as much as 9 percent this year.
http://www.bloomberg.com/apps/news?pid=20601087&sid=a9TF9BD.o60g&pos=1

But not all of Asia is booming. Below the latest big idea in Japan. I think the commentator quoted from RBS might just be a tad optimistic.

Japan mulls monetisation of public debt and yen devaluation

Japan’s ruling party has called for drastic monetary easing to devalue the yen by 30pc and halt the slide into deflation, putting it on a collision course with the Bank of Japan.
By Ambrose Evans-Pritchard Published: 6:00AM BST 14 Apr 2010

A draft by 130 lawmakers from premier Yukio Hatoyama’s Democratic Party of Japan said the country needs a radical shift towards growth policies, calling for an inflation target above 2pc. The exchange rate should be steered to ¥120 against the dollar, from the current ¥90.
Shizuka Kamei, financial affairs minister, said the central bank must monetise government debt to support the market for state bonds and prevent deflation becoming deeply lodged in the economy.

The Bank of Japan’s governor, Masaaki Shirakawa, told lawmakers that it would illegal to fund state spending by printing money. “History has proven that central banks directly buying government securities caused severe inflation and dealt a blow to the economy. The BoJ is now providing adequate funds,” he said.

Tokyo is still able to issue 10-year bonds at ultra-low rates of 1.4pc, relying on a captive savings market, even though gross public debt will reach 225pc of GDP this year, the highest in the world.

However, there are growing fears of a “malign scenario” where rising rates set off a debt compound spiral. The IMF has warned that borrowing costs may rise sharply as Japan’s aging crisis bites in earnest.

Junko Nishioka, an economist for RBS, said the BoJ is haunted by hyperinflation after World War Two. It is afraid debt monetisation could back-fire, triggering the very crisis that everybody fears. “We don’t think a fiscal accident is likely yet. Pension funds will keep buying debt for another five or six years. After that pressure increases,” she said.
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/7587346/Japan-mulls-monetisation-of-public-debt-and-yen-devaluation.html

We end for the morning with a sense of dread. Below Bloomberg covers the latest public US 1950s style dressing down delivered to rising China, bubble or not. Below that, China’s riposte via Reuters covering an article from Xinhua. Below that, “Turbo tax” Timmy puts in his two cents worth of free advice. It really would be funny if we weren’t all on our way to a fiat currency catastrophe.

"Drawing on my fine command of language, I said nothing."

Robert Benchley.

Obama Says He Told Hu That Yuan Is ‘Undervalued’
April 14 (Bloomberg) -- President Barack Obama said the U.S. considers China’s currency to be “undervalued” and that currencies should “roughly” track the market so that no country has an advantage in trade.

The U.S. and China, as part of the Group of 20 nations, have agreed that a rebalancing is needed to sustain global economic growth, Obama said at a news conference yesterday. He said he conveyed the U.S. position that China’s currency should have a more market-based valuation in a meeting April 12 with Chinese President Hu Jintao.

“It’s my estimation that the renminbi is undervalued and that China’s own decision in previous years to begin to move towards a more market-oriented approach is the right one,” Obama said.
Obama is under pressure from lawmakers to take a tougher stance on the yuan after the U.S. ran a $227 billion trade deficit with China last year. At the same time he’s aware that angering
Chinese officials could be counterproductive.

“China rightly sees the issue of currency as a sovereign issue,” Obama said. “I think they are resistant to international pressure when it comes to them making decisions on their currency policy and monetary policy.”
http://www.bloomberg.com/apps/news?pid=20601089&sid=auxclqtqBZoo

Hu tells Obama: China to make its own call on yuan
(Reuters) - China will chart its own course in reforming the yuan, President Hu Jintao told President Barack Obama, reinforcing the view that Beijing is likely to tip-toe, not leap, toward appreciation.

The two heads of state, meeting on Monday for the first time since Sino-U.S. tensions over the yuan threatened to escalate into a serious trade dispute, chose their words carefully and, in the view of investors, left the door open for Beijing to resume appreciation in the coming weeks.
Hu said China would not be pushed by external pressure and would instead base any decision on the yuan on its own economic needs. But he also made clear that Beijing was committed to change.

"China will firmly stick to a path of reforming the yuan's exchange rate formation mechanism," Hu told Obama, according to the official Xinhua news agency account of their discussion on the sidelines of a nuclear security summit in Washington.

"In making reforms, we will give careful consideration to global economic developments and changes, as well as to China's economic condition," Hu said.
http://www.reuters.com/article/idUSTRE63C0OI20100413

Geithner Says China ‘Effectively Lets’ U.S. Set Interest Rates
April 14 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner said China is likely to move toward a more flexible currency because its practice of pegging the yuan to the dollar limits the Asian nation’s ability to conduct monetary policy.

“As a strong, large, independent, growing economy, it doesn’t make sense for that country to run a monetary policy exchange-rate regime that effectively lets the Federal Reserve set interest rates for their economy,” Geithner said at an American Society of News Editors conference in Washington yesterday. “That’s why I think -- why I’m confident that they’re going to move.”
http://www.bloomberg.com/apps/news?pid=20601089&sid=avUrdornw168

At the Comex silver depositories Tuesday, final figures were: Registered 49.49 Moz, Eligible 66.32 Moz, Total 115.81 Moz.

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Crooks & Scoundrels Corner.

The bent, the seriously bent, and the totally doubled over.
Today, a strange mea culpa from the man who saved the world [twice] and up till now has blamed America for creating the worst recession since the Great Depression. But first, departing from his usual modesty and dour Fife charm, some gratuitous media advice for Rupert Murdoch. Give it up son, on yer bike. Folk are never going to pay good money for what you print in the Times and the Sunday Times. It’s certainly a different way to seek re-election.

“You think you are big enough to make me, you little wimp? Come on, come over here and make me, I dare you… You little fruitcake. You little fruitcake. I said you were a little fruitcake.”
Congressman Peter Stark to Congressman Scott McInnis, after being told to shut up in a legislative dispute.

US politics is certainly more lively than in our House of Crooks, aka the longest running farce in the world.

Prime Minister: paywalls don’t work
By Hani Megerisi
Posted on 13 Apr 2010 at 11:21
Gordon Brown has dismissed digital paywalls as unworkable.

The Prime Minister said plans to make news readers pay for online content can’t work “in the way that people think… [as] people have got used to getting content without having to pay”.

"People will pay for certain things, and should pay for certain things, but I think there’s a whole sort of element of communication that’s got to be free. People mind paying for basic news,” he added, in an interview with The Radio Times.

His comments come just weeks after News Corp CEO Rupert Murdoch announced his British titles would be moving behind a paywall. Both The Times and The Sunday Times will be pay-only from June, with The Sun and The News of the World expected to follow soon.

Murdoch has long accused news aggregators such as Google News of stealing content from newspapers, even threatening to sue sites who offer links to his content.

Brown’s comments come seven months after some of Murdoch’s UK titles publicly switched their allegiances to the Conservatives after backing the Labour party for 12 years. The Sun, which has the highest readership of the national dailies, attacked the Labour Government during the party’s annual conference and announced it was backing the Tories in the General Election.
http://www.pcpro.co.uk/news/357202/prime-minister-paywalls-don-t-work

"[In 1997 the banks] all came to us and said, 'look, we don't want to be regulated, we want to be free of regulation'.All the complaints I was getting from people was, 'look, you're regulating them too much'. The truth is that globally and nationally we should have been regulating them more.So I've learnt from that. You don't listen to the industry when they say, 'this is good for us'. You've got to talk about the whole public interest."

Prime Minister Gordon Brown. Mea Culpa April 2010.

UK General Election polls. – Why a hung Parliament looks increasingly likely.
http://www.ukpollingreport.co.uk/blog/

More on the RMS Titanic for those interested, soon to be known as UK Plc if Great Britain’s voters embark on the magical mystery voyage of a hung Parliament.
http://www.titanic-facts.com/

The monthly Coppock Indicators finished March:
DJIA: +168 UP. NASDAQ: +370 UP. SP500: +196 UP. The great Bull market goes on with the all three continuing higher in positive numbers.

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Help the LIR fight Banksterism, the EU, and for sound money.
If you can, help the LIR stay around and make a difference. Please make a donation at the PayPal link on the website or better still become a sponsor for what looks like an exciting 2010. Capitalism not banksterism. Many thanks to all who have helped.

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Sunspots – A 22 year colder world? (From 2004?)

Spotless Days April 13
Current Stretch: 0 days
2010 total: 7 days (7%)
2009 total: 260 days (71%)
Since 2004: 777 days
Typical Solar Min: 485 days
http://www.spaceweather.com

The long minimum seems to have ended.

New Solar Cycle Prediction
http://science.nasa.gov/headlines/y2009/29may_noaaprediction.htm

Is the Sun Missing Its Spots?
http://www.nytimes.com/2009/07/21/science/space/21sunspot.html?8dpc

Are Sunspots Different During This Solar Minimum?
-----But something is unusual about the current sunspot cycle. The current solar minimum has been unusually long, and with more than 670 days without sunspots through June 2009, the number of spotless days has not been equaled since 1933.

----During the period from 1645 to 1715, the Sun entered a period of low activity now known as the Maunder Minimum, when through several 11- year periods the Sun displayed few if any sunspots. Models of the Sun's irradiance suggest that the solar energy input to the Earth decreased during that time and that this change in solar activity could explain the low temperatures recorded in Europe during the Little Ice Age.

----The same data were later published [Penn and Livingston, 2006], and the observations showed that the magnetic field strength in sunspots were decreasing with time, independent of the sunspot cycle. A simple linear extrapolation of those data suggested that sunspots might completely vanish by 2015.These observations caused researchers to wonder whether the characteristics of sunspots are different now than in other solar cycles.http://www.leif.org/EOS/2009EO300001.pdf

Big freeze could signal global warming 'pause'
The Arctic conditions which have brought Britain to a standstill over the past week could be the start of a "pause" in global warming, some scientists believe.
Published: 9:20AM GMT 11 Jan 2010
http://www.telegraph.co.uk/earth/environment/globalwarming/6965342/Big-freeze-could-signal-global-warming-pause.html

Sunspot cycle 24: Together with sunspot cycle 25, the next two global cooling cycles. The new “Dalton Minimum?” Twenty Nine months now with low sunspots numbers, and counting. March was the 29th month of yet another low number of 15.4 http://en.wikipedia.org/wiki/Dalton_Minimum

Smoothed sunspot numbers (SSN). 2007, Oct. 0.9. The end of cycle 23.

Sunspot cycle 24: Nov 1.7. Dec 10.1. Jan 3.4. Feb 2.2. Mar 9.3 April 2.9. May: 2.9. June 3.1. July 0.5. August 0.5. Sep 1.1 Oct. 2.9. Nov. 4.1 Dec 0.8. Jan 1.5. Feb 1.4. Mar 0.7. Apr 1.2. May 2.9. June 2.6. July 3.5. Aug. 0.0. Sep 4.2. Oct 4.6. Nov 4.2. Dec 10.6 Jan 13.1 Feb 18.6 Mar 15.4.

Sunspots. http://solarscience.msfc.nasa.gov/SunspotCycle.shtml

The count. http://sidc.oma.be/products/ri_hemispheric/

Why a New Minimum. http://sesfoundation.org/dalton_minimum.pdf

The “Carrington Event,” September 1, 1859.
http://science.nasa.gov/headlines/y2008/06may_carringtonflare.htm

Current Space Weather.
http://www.swpc.noaa.gov/

What happened to global warming?
http://news.bbc.co.uk/1/hi/sci/tech/8299079.st

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This week’s featured links: Silver & Gold Miners + Rare Metals.
With US trillion dollar deficits stretching as far as the eye can see, and voodoo economics the order of the day at the central banks, I think it is now time to begin selectively scaling into precious metals companies that mostly meet the following criteria:

Adequate cash reserves. Good management. Strong in-ground reserves or prospects. NAFTA based, or else located in countries with strong rule of law.

Endeavour Silver Corp. TSX: EDR. http://www.edrsilver.com/s/Home.asp

Semafo TSX: SMF http://www.semafo.com/home_company_intro.php

ATW Gold Corp. TSX.V: ATW. http://www.atwgold.com/

US Silver Corp. TSX.V: USA. http://www.us-silver.com/s/Home.asp

Excellon Resources Inc. TSX: EXN. http://www.excellonresources.com/

First Majestic Silver Corp. TSX: FR http://www.firstmajestic.com/s/Home.asp

New Jersey Mining Company. OTCBB: NJMC
http://www.newjerseymining.com/index.html

Atna Resources Ltd. TSX: ATN. http://www.atna.com/s/Home.asp

Barkerville Gold Mines TSX.V: BGM. Formerly International Wayside Gold Mines Ltd.
http://www.barkervillegold.com/s/Home.asp

Shoreham Resources Ltd. TSX-V: SMH http://www.shoreham.ca/

ATAC Resources Ltd, TSX.V: ATC. http://www.atacresources.com/s/home.asp

Evolving Gold Corp. TSX.V: EVG http://www.evolvinggold.com/

Lydian International Ltd. TSX: LYD. Note: LYD operates in Armenia, a region carrying higher risk than our usual safer picks in NAFTA lands. http://www.lydianinternational.co.uk/

The story of rare earths and metals is mostly one of China producing and exporting, Japan, America and everyone else importing. Vital to our new technologies, and lifestyle, and critical to hybrid and electric cars, Rare Earth Elements and Heavy Rare Earths, are a strategic choke point held in China’s hands. Lately China has been squeezing that choke point. I think that AVL at Thor Lake Canada, has a property of global importance. A property with the ability to offer NAFTA access to REEs and HREs for the decades ahead. As America and the west move to reduce over dependence on oil from unstable regions, we will see demand for rare metals take off.

Avalon Rare Metals Inc. TSX: AVL. www.avalonraremetals.com

We will be adding more REEs as appropriate.

Warning.
Sadly we are all in unexplored territory. The world has never before suffered a severe recession/depression while operating on fiat currency. As is widely apparent, the central banks haven’t a clue and are making up the rules as the flounder along. They never saw it coming they claim, although it was obvious to many fine writers though not unfortunately in the mainstream media, that a giant financialised derivatives gambling economy would always end badly. There are no experts now, for the simple reason that we have never before faced such a sudden synchronised and deep collapse in the global economies.

The unfortunate fact that we are operating on fraudulent currencies is highly likely to mean it all ends many months from now, in a fiat currency revulsion, but only after the monetary authorities have first tried pouring in endless amounts of newly created money. A derivatives gambling world with an estimated quadrillion dollars of face value has to be unwound and the losses absorbed. In this sort of investing environment, cash, gold and silver and tangible assets are favoured over stocks and intangible assets.

As always if thinking about making an investment, it’s important to do one’s own due diligence. No one has more at risk in an investment than you do yourself. In these difficult economic times, there will likely be several false bottoms before the real one arrives and hindsight allows us to confirm that the bottom is in. Even then, a “V” shaped rebound is highly improbable. A double dip recession seems likely. Beware the false "statistical" government subsidised "recovery." It is a "recovery" bought from a future of fiat currency collapse.

Graeme Irvine

London Irvine Report: www.londonirvinereport.com/

Graeme@londonirvinereport.com