Merry Christmas from the City

In keeping with our new age of austerity except at the bailed out bankster banks, we present the 2011 update on an old childrens favourite. Merry Christmas from Wall Street and the City in London.

Christmas is coming and the geese are getting fat,

Please put a trillion in the banksters’ hat.

If you haven’t got a trillion a billion will do,

If you haven’t got a billion, God damn you!

Ebenezer Squid

LIR – 2 Days To Save The Euro.

Baltic Dry Index. 1856  -10

LIR Gold Target by 2019: $30,000.  Revised due to QE programs.

Christmas is coming and the geese are getting fat,

Please put a trillion in the banksters’ hat.

If you haven’t got a trillion a billion will do,

If you haven’t got a billion, God damn you!

Ebenezer Squid.

Stay long physical precious metals. The MF Global scandal is just the tip of the iceberg. For the full story scroll down to Crooks and Scoundrels Corner, but simply put, the great vampire squids  routinely re-hypothecate customer assets multiple times via their London based subsidiaries. The daisy chain of all daisy chains has broken. When the euro fails, as it almost certainly will next year, re-hypothecation goes into reverse, except the money isn’t there in the shadow banking system. Up to $15 trillion is missing. The system if effectively a bankrupt Ponzi Scheme. A giant Madoff exposed on the third anniversary of the Madoff implosion.  Whatever gets discussed over dinner tonight in Brussels, and dictated all day tomorrow by Germany to the vassal states and the non Eurozone outer barbarians is largely meaningless. At this point Europe’s ditherers and bunglers are largely irrelevant. There’s a black hole in London that’s unfixable.

MF Global is just the tip of the iceberg. As recession hits in Europe, Europe’s and specifically London’s lax hypothecation regulation crashes the system. The same customer assets have been pledged against loans over and over again. As this becomes more widely realised, clients will try to pull their money out of the Wall Street Squids, re-hypothecation goes into reverse.  Tonight and tomorrows meetings are merely about rearranging the deck chairs on the Titanic. After hitting an iceberg with Lehman, a tsunami of cash withdrawal is coming next year. As with Madoff, there isn’t much cash left its all smoke and mirrors. We have reached the end of the road.

"Liquidation sometimes is orderly, but more frequently degenerates into panic as the realization spreads that there is only so much money, not enough to enable everyone to sell out at the top”.

Charles P. Kindleberger.  Manias, panics and crashes.

DECEMBER 8, 2011

Banks Prep for Life After Euro

Countries Study Printing Their Own Notes in Case Monetary Union Unravels

Some central banks in Europe have started weighing contingency plans to prepare for the possibility that countries leave the euro zone or the currency union breaks apart entirely, according to people familiar with the matter.

The first signs are surfacing that central banks are thinking about how to resuscitate currencies based on bank notes that haven't been printed since the first euros went into circulation in January 2002.

At least one—the Central Bank of Ireland—is evaluating whether it needs to secure additional access to printing presses in case it has to churn out new bank notes to support a reborn national currency, according to people familiar with the matter.

Outside the 17-country euro zone, numerous European central banks are eyeing defensive measures to protect against the possible fallout if the euro zone were to unravel, other people said. Several, including Switzerland, are considering possible replacements for the euro as the external reference point, or peg, they use to try to keep their currencies' values stable.

The central banks' planning is preliminary, according to the people familiar with the matter. It doesn't represent an expectation that the euro zone is headed for dissolution.

But the fact central bankers are even studying the possibility, which until this fall was considered unthinkable, underscores how swiftly conditions have deteriorated. Policy makers, central bankers and investors around the world have pinned their hopes on this week's Brussels summit to forge a long-awaited solution to the Continent's two-year financial crisis, which was ignited by doubts over countries' abilities to pay their debts.

More

http://online.wsj.com/article/SB10001424052970203413304577084483874422516.html?mod=WSJEurope_hpp_LEFTTopStories

“When people look back on this period in five or ten years from now, they'll say that this was something approaching a turning point for the American economy."

Robert A. Rubin, Chairman National Economic Council, 1994.

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A Wonderful Life.

My mother passed peacefully away at 88, September 2nd 2011 at roughly 9 pm, after being visited by my brother and his family, my middle niece and her youngest great grandchild (1year old ,) and attended by myself and my sister and my youngest niece and her husband of July 2nd. It was time and in God's judgement the appropriate time. Dying at the weekend creates some administrative problems here, which I will overcome. My normal service will resume on Currency Countdown. com in a few days. I thank everyone, of all religions or none, for their kind thoughts and prayers. They were/are deeply appreciated. My normal updates will resume in a few days. Cherish your family while they are still with you.

Very respectfully,

Graeme Irvine

The Financial Crisis Explained

The central bankster solution.

This financial crisis is forcing some tough
decisions. If things continue for much longer,
there's a risk that Jose may be laid off.

After 10 years or so, the LIR is moving.

"For more than two thousand years gold's natural qualities made it man's universal medium of exchange. In contrast to political money, gold is honest money that survived the ages and will live on long after the political fiats of today have gone the way of all paper."

Hans F. Sennholz

First my deep thanks to all my loyal readers many of whom have stayed with me for all of the last 10 western wealth destructive years. My thanks also for sending along so many links and items of interest. Please keep them coming along. Due to the fiat currencies entering their final destructive phase, I am pleased to announce a new partnership with Currency Countdown. As such, the London Irvine Report will move from this address to www.currencycountdown.com. Please update your browser bookmarks.

Currency Countdown is the familiar LIR , but much more. We are in transition from the 40 year old, wealth destructive, fiat dollar reserve standard as we knew it, to a great big unknown. Eventually, the global system will be rebalanced with a settlement mechanism tied to gold again, but we have much excitement and wealth destruction still to come first. Currency Countdown can better address this coming change. Please join me over at Currency Countdown, where Twitter feeds and Facebook, and all that modern stuff will also be available. "Ad infinitum et ultra!"

All current subscribers will be continue to receive their daily L.I.R. daily newsletter as per usual. New subscribers can join here. If there are any questions please feel free to contact us.

“And how is education supposed to make me feel smarter? Besides, every time I learn something new, it pushes some old stuff out of my brain. Remember when I took that home winemaking course, and I forgot how to drive?”

Homer Simpson

To the next 10 difficult years.

Graeme Irvine.

Forget Greece!

Baltic Dry Index. 1420 -18

LIR Gold Target by 2019: $30,000. Revised due to QE programs.

Faced with the choice between changing one's mind and proving that there is no need to do so, almost everyone gets busy on the proof.

John Kenneth Galbraith

While all attention is focused on Greece and the likelihood of a Greek default within two years, yesterday’s austerity vote is merely intended to buy time for Europe’s banks and delay the Greek default as long as possible, pouring good taxpayer money after bad, on the other side of the Atlantic a similar drama is in play. Partisan politics for the spoils of the next presidency risk Uncle Sam defaulting on its debts on August 2. Unlike a Greek default, which would trigger a slow motion rolling contagion across Europe’s PIIGS, and probably blow up Belgium as well, any US default would trigger an instantaneous contagion, right around the world, probably taking down the fiat currency financial system as we know it. You’ve got to think that US politicians couldn’t be that stupid. Even so, the IMF, now under new French feminine friendly management, is starting to panic that they might be. In a hard left v hard right fight, tinged with implicit racism for the spoils of the next presidency, all seem to have lost sight of the bigger picture. Dollar suicide is looming into view.

Stay long physical gold and silver. An 18 month guerilla war is underway in America for the presidency. Below, what panic looks like in the ever so diplomatic world of the banksters.

In central banking as in diplomacy, style, conservative tailoring, and an easy association with the affluent count greatly and results far much less.

J. K. Galbraith

US risks "severe shock" over debt talks

America will cause a "severe shock" to world financial markets should Congress fail to agree an increase in the country's debt ceiling in a month's time, the International Monetary Fund (IMF) has warned.

By Richard Blackden, US Business Editor 11:38PM BST 29 Jun 2011

The fund used its annual healthcheck on the world's biggest economy to spell out the dangers of failure, which would likely include the US government defaulting on its debt for the first time in its history.

"It should be self-evident a debt default by the US government would have very serious, far-reaching and dramatic repercussions," said John Lipsky, the IMF's acting managing director. "That's why were are confident it will be avoided."

Republicans and Democrats have been locked in tense negotiations for the past month on how to raise the country's $14.3 trillion (£8.9 trillion) debt ceiling, which the Treasury has said will be reached on August 2.

The talks, which Republicans walked out of last week, are widely seen as a forerunner of the battle over the deficit that will be central to next year's presidential election.

President Barack Obama, who stepped into the talks this week, said that "we don't know how capital markets will react" should an agreement not be struck. Ratings agency S&P said yesterday that the US would have its AAA credit rating slashed if it missed an interest payment on its debts after the deadline.

More

http://www.telegraph.co.uk/finance/economics/8607014/US-risks-severe-shock-over-debt-talks.html

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Technorati Tags: Greece,IMF warns USA,BIS warns G-7,China Wobbles,gold and silver,REEs,sunspots and global cooling.

High Noon.

Baltic Dry Index. 1438 -04

LIR Gold Target by 2019: $30,000. Revised due to QE programs.

There's no time for a lesson in civics, my boy. In the 5th century B.C., the citizens of Athens, having suffered grievously under a tyrant, managed to depose and banish him. However, when he returned after some years, with an army of mercenaries, those same citizens not only opened the gates to him, but stood by while he executed members of the Legal Government.
High Noon. 1952.

It is High Noon. The day the hapless Greek MPs get to vote on debt slavery for their fellow Greeks, just like the hapless Irish MPs before them, or get a little Icelandic backbone, and tell their Berlin, Brussels and Paris based would be overlords to take an Ottoman hike. According to most of the media, modern Greek MPs aren’t made of Icelandic stock, and the MPs will vote through the Bilderberger plan for debt slavery and a fire sale of Greek national assets. Sadly all too soon, Greek hairdressers will have to give up retiring at 50, and slave away like fanatical Germans until they reach 62 or 65, or whatever other age limit Merkel-Sarkozy decide to impose. Who knew, deficits do matter after all. Today’s FT headline sums it all up for the tax and work shy Greeks, “Greece faces suicide vote on austerity”. Below, the EU turns the screw some more.

“The secret of business is to know something nobody else knows”

Aristotle Onassis.

EU commissioner Olli Rehn warns Greek austerity package must be approved

The European Union's top economic official has warned Greek politicians there is "no Plan B" and the austerity package must be approved, regardless of the violent protests rocking Athens.

By Louise Armitstead 7:31AM BST 29 Jun 2011

Ahead of Wednesday's crucial vote on a €28bn (£25bn) austerity package, Olli Rehn, the commissioner responsible for economic and monetary affairs, said: "To those who speculate about other options, let me say this clearly: there is no Plan B to avoid default."

He added: "The future of the country and financial stability in Europe are at stake. I trust that the Greek political leaders are fully aware of the responsibility that lies on their shoulders to avoid default."

More

http://www.telegraph.co.uk/finance/financialcrisis/8604489/EU-commissioner-Olli-Rehn-warns-Greek-austerity-package-must-be-approved.html

While we wait for the Greek turkeys to vote in Christmas for French and German banksters, we turn today to some other less reported news. Up first, China caught in a “smiling face” lie of their own making. China can’t be trusted it seems.

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Technorati Tags: Greek vote,China's lies,UK rate rise,a fair cop,gold and silver,BOA settles,REEs,sunspots and global coolin.

Italy Next?

Baltic Dry Index. 1442 +18

LIR Gold Target by 2019: $30,000. Revised due to QE programs.

Last Thursday, Moody’s Investors Service placed the long-term debt and deposit ratings of 16 Italian banks and the long-term issuer ratings of two Italian government-related financial institutions on review for possible downgrade. That followed its June 17 move to place Italy’s Aa2 sovereign bond rating on review for possible downgrade.

Marketwatch.

While Greece begins another 48 hour general strike, (except for the Athens metro, the unions want the public to travel to the parliament building to put pressure on the MPs ahead of the latest austerity vote. Not to worry, as we learnt yesterday in Crooks and Scoundrels corner, no one actually pays to ride on the Athens metro,) the market is moving on from Greece, moving on as well from little Portugal and giant Spain, the market is now starting to focus on to big too save, Italy. Italy faces many of the same problems as Greece compounded by giant cross investment with Gaddafi’s Libya.

But first this from America, America’s economy has taken a giant wobble again. Everything now seems to rest on a continued decline in gasoline prices reviving US consumers other consumption. Alarmingly we now have wobbles in America and China, and a full blown crisis in the near to failing European Monetary Union. Bunker time if not panic time. Stay long physical precious metals.

"You can observe a lot by just watching."

Yogi Berra.

US consumer spending weakest for a year

US consumer spending has slumped to its weakest in almost a year, underscoring the slowdown the economy has endured in 2011.

By Richard Blackden, US Business Editor 6:32PM BST 27 Jun 2011

Spending was flat in May, the Commerce Department said on Monday, and, once adjusted for inflation, showed a decline of 1pc.

Hopes that 2011 would see the US recovery strengthen have so far been dashed as higher gasoline and food prices erode the spending power of millions of Americans.

The Commerce Department also said that average incomes climbed 0.3pc in May, which, alongside the recent decline in gasoline prices, provides some optimism for the second half of the year.

Average prices have dropped just over 10pc since reaching a three-year high of $3.99 at the start of May.

"Consumer spending and confidence has soured," said Chris Christopher, an analyst at IHS Global Insight. "The one piece of good news is that gasoline prices have started to fall offering some relief to a very fatigued consumer."

More

http://www.telegraph.co.uk/finance/economics/8601503/US-consumer-spending-weakest-for-a-year.html

Now back to Berlusconi and Gaddafi’s Italy. Does any part of Club Med actually work?

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Technorati Tags: US consumer spending falls,Italy follows Greece,UK retailers fail,China wobbles,Saab limps on,gold and silver,green shoots die,REEs,sunspots and global cooling.