Monday 3 January 2011

“Welcome to the Titanic.”

Baltic Dry Index. 1773

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

"Of all the contrivances for cheating the laboring classes of mankind, none has been more effective than that which deludes them with paper money."

Daniel Webster

“Welcome to the Titanic”, said EU President Herman Von Whatsit, as 1.3 million impoverished Estonians scrambled aboard the sinking Euro leviathan on New Year’s day. 82 million First Class Germans looked in horror, desperate to get off. And so the latest chapter begins in the odyssey of the SS Euro Titanic, as it careens around rudderless from iceberg to iceberg, hemorrhaging German wealth with each encounter. Soon the hapless Estonians will be lining up behind the Germans asking to be let into the world of first class. Back on the bridge, 3 EU Presidents, advised by a billion Brussels bureaucrats, bicker over how to extort even more wealth out of the unfortunate 500 million serfs trapped by traitorous politicians in the doomed Bilderberg European Union. It would be comical if it wasn’t all so serious to our future.

We open with the Centre for Economics and Business Research, daring to think the unthinkable. Dismal scientists all, they are still optimistically talking in terms of a decade.

"Deficit spending is simply a scheme for the 'hidden' confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights."

Alan Greenspan

Euro stands just 20pc chance of survival in next decade

The euro stands just a one in five chance of surviving in its current form for ten years, according to the Centre for Economics and Business Research.

By Harry Wilson 6:15AM GMT 01 Jan 2011

In its annual list of predictions, the CEBR said a new eurozone crisis was its number one forecast for 2011, citing the hundreds of billions of euros of debt that members must replace this year.

"If the euro doesn't break up, this could be the year when it weakens substantially towards parity with the dollar," said Douglas Williams, chief executive of CEBR.

Spain and Italy alone must refinance more than €400bn (£343bn) of debt in the first half of the year, which could prove impossible given investor fears over the finances of southern European countries.

"The euro might break up at this point, though European politicians are normally able to respond to a crisis and I suspect that what will break up the euro will be the failure of most of the countries to take the tough medicine necessary to make their economies competitive over the longer term," said Mr Douglas.

Mr Douglas added that he was not ruling out another round of government quantitative easing to support the credit markets and prevent a crisis.

----Japan could also face its own crisis, according to the CEBR, with the possibility of a serious economic crisis in the world's third largest economy rated its fourth most likely prediction.

Debt now equals 200pc of Japanese GDP, but up until now this has largely been financed domestically from the country's vast savings base.

However, the continued growth in Japanese debt means more foriegn financing will be required, according to the CEBR, which could create the conditions for a crisis.

"It is likely that the government will have to embark on fiscal retrenchment. Meanwhile, growth in the Asian export markets will slow and the ageing population will force the government to raise the retirement age again, this time to 75," said Mr McWilliams.

http://www.telegraph.co.uk/finance/currency/8234083/Euro-stands-just-20pc-chance-of-survival-in-next-decade.html

Ex-Soviet state Estonia to become 17th eurozone member

Estonia will become the first former Soviet state to adopt the euro when it becomes the 17th member of the eurozone at midnight.
1:01PM GMT 31 Dec 2010

Opponents of the move plastered the capital Tallinn with posters protesting the changeover from the kroon to the euro at midnight.

"Estonia! Welcome to the Titanic!", read posters, highlighting the debt and deficit crises which have plagued eurozone members Greece, Ireland, Portugal and Spain.

"The euro is huge trouble for Estonia," Anti Poolamets, a lawyer and historian who runs "Save The Kroon" told AFP on Friday.

"This situation is downright peculiar. A small Nordic country that has been praised so much for keeping its budget balanced and not living beyond its means is joining a union that has many members doing the exact opposite.

"And the outcome is that poor Estonia will have to start paying for countries like Ireland who have no one else but themselves to blame for their financial woes".

Government-commissioned surveys have found that around half of Estonians favour the switch to the euro, but a eurosceptic-commissioned survey in October found that only 34.3pc were in favour while 52.8pc were against.

Estonia's centre-right government says adopting the euro is an important signal to investors and will be a boon for businesses as 80pc of Estonia's trade is within the 27-nation European Union which Tallinn joined in 2004.

Hundreds of bank cash machines across Estonia were were shut down on Friday to stock them ahead of the adoption of the single currency by the tiny Baltic nation of 1.3m people.

http://www.telegraph.co.uk/finance/currency/8233645/Ex-Soviet-state-Estonia-to-become-17th-eurozone-member.html

Far away from the continuing farce of the United States of Extortion and Upset, Japan’s population is still getting smaller and now at a record pace. Must be something to do with all those centenarian pensioners they kicked off the rolls last year, after finding out most had been dead or missing for decades. Imagine, crooked Japanese on the make!

"The gold standard, in one form or another, will prevail long after the present rash of national fiats is forgotten or remembered only in currency museums."

Hans F. Sennholz

Japan population shrinks by record in 2010

Associated Press Saturday, 1 January 2011

Japan's population fell by a record amount last year as the number of deaths climbed to an all-time high in the quickly aging country.

Japan faces a looming demographic squeeze. Baby boomers are moving toward retirement, with fewer workers and taxpayers to replace them. The Japanese boast among the highest life expectancies in the world but have extremely low birth rates.

Japan logged 1.19 million deaths in 2010 — the biggest number since 1947 when the health ministry's annual records began. The number of births was nearly flat at 1.07 million.

As a result, Japan contracted by 123,000 people, which was the most ever and represents the fourth consecutive year of population decline. The top causes of death were cancer, heart disease and stroke, the ministry said.

Japanese aged 65 and older make up about a quarter of Japan's current population. The government projects that by 2050, that figure will climb to 40 percent.

Like in other advanced countries, young people are waiting to get married and choosing to have fewer children because of careers and lifestyle issues.

Today's report showed 706,000 marriages registered last year — the fewest since 1954 and a sign that birth rates are unlikely to jump dramatically anytime soon.

http://www.independent.co.uk/news/world/asia/japan-population-shrinks-by-record-in-2010-2173607.html

We close with a thought for our unfortunate cousins residing in Beijing. Winning the lottery will never be the same, because winning now means you get to part with thousands and thousands of Yuan, and in exchange get a car that can only move at 4 mph, if it moves at all. Sadly this very bad idea is likely to be picked up by Brussels and imposed on the serfs of Europe.

"Politicians can't give us anything without depriving us of something else. Government is not a god. Every dime they spend must first be taken from someone else."

Barry Asmus

Beijing launches car quota to counter gridlock

Associated Press Saturday, 1 January 2011

For thousands of hopeful commuters in China's capital, 2011 started with a click, not a bang.

Residents hoping to snap up Beijing car licence plate numbers under a new quota system aimed at easing paralyzing traffic logged onto a website that launched in the first moments of the new year. Within 10 minutes, 6,000 people had applied for new plate numbers, the Beijing Daily newspaper reported.

By 11am, more than 36,000 applications had been submitted online, the official Xinhua News Agency said. The applicants are competing for the first batch of 20,000 plates, which are to be awarded by lottery on 25 January. Every month a new batch of plates will become available.

The new system aims to reduce the number of cars in the notoriously gridlocked capital. The city will only allow 240,000 new car registrations in 2011 — two-thirds less than last year — and is parceling them out via the monthly online lottery.

The city now has 4.76 million vehicles, up from 2.6 million in 2005.

A global survey conducted last year by IBM said Beijing is tied with Mexico City for the world's worst commute. Worries are growing that Beijing is choking itself for future growth as it gets more difficult to move people and goods around the city.

Nearly 70 per cent of Beijing drivers told the IBM survey they had run into traffic so bad they've turned around and gone home.

http://www.independent.co.uk/news/world/asia/beijing-launches-car-quota-to-counter-gridlock-2173609.html

"There can be no other criterion, no other standard than gold. Yes, gold which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence."

Charles De Gaulle

At the Comex silver depositories Thursday, final figures were: Registered 45.73 Moz, Eligible 58.97 Moz, Total 104.70 Moz.

+++++

Crooks and Scoundrels Corner.

The bent, the seriously bent, and the totally doubled over.

No crooks today, just an update on our “global warming”. Carbon dioxide warming doesn’t seem to work as before. It seems to be working in reverse.

01/01/2011 00:58

December was coldest in 120 years

The past month was Britain's coldest December for 120 years, meteorologists have said.

It was also the chilliest individual calendar month since February 1986, according to weather historian Philip Eden, with temperatures dropping as low as -21.1C in the Scottish Highlands.

A series of heavy snowfalls across the UK caused massive disruption to road, rail and air travel as the nation shivered in freezing conditions.

The benchmark Central England Temperature plunged to an average of -0.6C over the month, the lowest figure for December since 1890, according to MeteoGroup UK.

There were 10 nights in December 2010 when the temperature fell below -18C somewhere in the UK.

Altnaharra in Sutherland, Scotland, experienced the coldest conditions, with the mercury plummeting to -21.1C early on December 1. By contrast, St Mary's in the Isles of Scilly basked in the relative warmth of a high of 11.5C on December 28.

Over the month, the lowest average maximum temperature of -0.4C was recorded in Dalwhinnie and Aviemore in the Scottish Highlands, and the highest of 7.6C in St Mary's. The average minimum temperature ranged from -8.4C in Tyndrum in Stirlingshire, Scotland, to 4.9C in St Mary's.

Much of Britain may have been freezing and snowbound in December, but it was drier and sunnier than usual.

Rainfall averaged 39.5mm over England and Wales (39% of the mean for 1971-2000), the lowest total for December since 1971, 48mm over Scotland (47%) and 59mm over Northern Ireland (60%).

Northern Ireland enjoyed 80 hours of sunshine over the month (227% of the mean for 1971-2000), Scotland 59 hours (178%) and England and Wales averaged 56 hours (117%).

http://news.uk.msn.com/uk/articles.aspx?cp-documentid=155728525

2010 South Florida Weather Year in Review

Coldest December on Record Concludes Year of Extremes

December 30th, 2010: Temperature and precipitation extremes marked the weather of 2010 across South Florida. A cool and wet January through March was followed by the hottest summer on record, and then concluded with the coldest December on record for the main climate sites in South Florida

More

http://www.srh.noaa.gov/images/mfl/news/2010WxSummary.pdf

"If you don't trust gold, do you trust the logic of taking a beautiful pine tree, worth about $4,000 - $5,000, cutting it up, turning it into pulp and then paper, putting some ink on it and then calling it one billion dollars?"

Kenneth J. Gerbino

The monthly Coppock Indicators finished December:

DJIA: +171 Down 7. NASDAQ: +238 Down 9. SP500: +165 Down 2.

The bull market (or bear market rally) that commenced on Nasdaq on 30/4/09 at 1717 has ended. (30/5/09 SP 500 at 919, 30/5/09 DJIA 8500.) While the indicators can flip flop at market turns, this action is rare on the slow monthly indicators. December is the seventh down month, but the downward momentum has virtually stopped. I would put on (purchased) synthetic double options here for a breakout in either direction. Professional traders would adopt much more risky granted option strategies.

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