Baltic Dry Index. 1456 -28.
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
The best way to destroy the capitalist system is to debauch the currency. By a continuing process of inflation, governments can confiscate, secretly and unobserved, an important part of the wealth of their citizens.
John Maynard Keynes
The chief enabler of God’s Vampire Squids is starting to get rattled. As more of the world wise up to the rigged system of derivatives gambling banksterism, the successor to fallen guru Greenspan is suffering from hurt feelings. Time to remove the lampposts from Washington, D.C. Stay long physical precious metals. As QE2 ends without much to show for it, the Fed must bring in QE3 or suffer the collapse QE2 was intended to prevent. But a new Tea Party Congress threatens to take the punch bowl away from the Fed. Helicopter Ben is under great stress.
June 7, 2011, 4:42 p.m. EDT
Bernanke takes his critics back to school
Commentary: Supply, demand explain rise in commodity price
WASHINGTON (MarketWatch) — The people who blame the Federal Reserve for all of our problems are starting to really get under Ben Bernanke’s skin.
Bernanke devoted nearly half of his major address on the economic outlook to debunking the charge by his critics who say the Fed’s ultra-accommodative policies are responsible for high gas prices, high food prices and the falling dollar.
It’s not the first time that the Fed chairman has fired back at critics of his unusual approach to monetary policy in an unusual time — those who say that ultralow interest rates and the massive expansion of the Fed’s balance sheet have fueled an epic bubble in assets, including commodities.
Essentially, Bernanke’s defense is that supply and demand explain virtually all of the increase in commodity prices since 2008. The simplest answer explains it best: The developing world is growing rapidly and using tremendous amounts of petroleum, metals and agricultural commodities, which is pushing prices higher temporarily because producers can’t keep up with demand.
You can feel Bernanke’s frustration boiling over, just as Peter Diamond did on Monday with that broadside against the know-nothings in the Senate who kept him off of the Fed’s board.
The condescension was dripping from Bernanke’s pen:
“When the price of any product moves sharply, the economist’s first instinct is to look for changes in the supply of or demand for that product,” he remarked. “Indeed, the recent increase in commodity prices appears largely to be the result of the same factors that drove commodity prices higher throughout much of the past decade: strong gains in global demand that have not been met with commensurate increases in supply.
“With the demand for oil rising rapidly, and the supply of crude stagnant, increases in oil prices are hardly a puzzle,” he said.
As for the decline in the dollar, Bernanke pointed out that recent weakness is merely reversing earlier strength in the dollar, created by the massive flight-to-quality flows during the darkest days of the 2008 panic. In any case, the dollar’s value is determined by many variables, including the pace of growth and the current account deficit.
The curt “class dismissed!” at the end of the speech was implied, not spoken. Read the full text of his Bernanke’s prepared remarks.
http://www.marketwatch.com/story/bernanke-takes-his-critics-back-to-school-2011-06-07
Next, more on the unintended consequences of fiat currency. With central banks monetizing like drunken sailors in a vain attempt at resurrecting 2006, fiat currency is forever falling in purchasing power. Speculation is rife, as gigantic pools of fiat money seek protection from the coming end of the fiat dollar reserve standard. Below, millions of Britain’s new downwardly mobile serfs are about to pick up the bill for a speculative increase in the wholesale price of gas and electricity. One unmentionable consequence is that much of the extra rent, will flow through to bankrupt Spain. Not to worry, no great vampire squids suffered from this version of God’s work. One day, fiat currency will end, but we are far from that day at present.
The market can stay irrational longer than you can stay solvent.
John Maynard Keynes.
Millions of households face record high energy bills
Millions of households were warned last night that they face “unacceptable” rises in their energy bills after one of the biggest power firms announced average increases of nearly £200 a year.
By Myra Butterworth, Personal Finance Correspondent 10:15PM BST 07 Jun 2011
Scottish Power became the first of the six major suppliers to disclose a new round of price rises. It told five million customers that gas and electricity bills would go up by 19 per cent and 10 per cent respectively.
The increase, which will take effect on Aug 1, will push households’ average annual bills to almost £1,400; the highest level ever.
Other energy suppliers are expected to follow suit and increase their prices within weeks.
The announcement is a fresh blow to households whose budgets have been squeezed after repeated increases in inflation. The Bank of England has previously warned that rising energy bills are likely to be one of the main factors behind the continued rise in the cost of living.
The Spanish-owned company, which made an operating profit of approximately £800 million last year, blamed the increases on a “prolonged” rise in wholesale gas and electricity prices, which have jumped 30 per cent since November.
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The scramble to lock up scarce resources, or profit from droughts and floods, is a logical consequence of the policies of central banks. From 1944 until 1971, this process was restricted by a dollar link to gold that kept new money creation largely in check. In today’s “too big to fail” derivatives gambling world of some 600 trillion, too much cash now chases the produce of a real world of a global economy of perhaps 60 trillion.
We end today’s shortened update, with news from America that could only come from America. You’ve got to like the only from Texas ending. On behalf of the readers we wish him a speedy and full recovery.
Texas is not technically part of the Third World, but no one has told the Texans.
With apologies to P. J. O’Rourke and Italians.
Texas police find no bodies after psychic tip-off
Police in Texas are investigating whether a tip-off from a psychic about a supposed mass grave containing dozens of dismembered bodies was a hoax.
3:38AM BST 08 Jun 2011
No bodies were found after officers, Texas Rangers and FBI agents combed an area around a rural home in Hardin, Texas, north-east of Houston
A woman claiming to be a psychic provided a very good description of both the outside and interior of the brown brick home and blood was found on the porch, which prompted police to get a search warrant and call in reinforcements.
Soon, local media were reporting that as many as 25 to 30 bodies - including children - were found on the rural property. But those reports turned out to be wrong.
"We searched the premises there is no indication there are any bodies at this residence, property or shed," Rex Evans, a captain with the Liberty County sheriff department, told reporters.
"There is no indication that a homicide occurred here."
Craig McNair, head of the county commissioners, expressed frustration with the "havoc" created by the false tip which led dozens of journalists to descend upon the quiet Texas town.
"There's no crime scene. Whoever this person was who gave this tip we'll be in touch with her and we could hold her responsible for giving a false tip and creating this havoc," he said.
The people who live there are long-haul truck drivers who are currently on the road and are baffled by the report, Evans said.
"Finding out that the police are in my yard for dead bodies? That's kinda panicking me," Joe Bankson, 44, told the Houston Chronicle.
"I haven't killed anybody," he said. "And I have a lot of friends, but I haven't helped anybody bury any bodies."
Bankson told KHOU-TV that the blood on the porch belonged to his daughter's ex-boyfriend, who got drunk and cut his wrists a couple weeks ago and is now in a psychiatric hospital.
At the Comex silver depositories Tuesday, final figures were: Registered 28.77 Moz, Eligible 72.25 Moz, Total 101.02 Moz. Deliverable silver is now only about 29% of Comex stocks. My guess is that inventories are signaling a default lies ahead.
+++++
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
Today, Paris Syndrome. Can these be the sons and daughters of the same Japanese that brought us Changi POW camp Singapore, and the Burma railway? Below that, when mere serfs try to holiday in modern America. Is anyone a free born person in 21st century America anymore? Is Abu Ghraib now the rule rather than the exception? Does the west have any accountability anymore? Is rule of law ended? In a 21st century that brought us discretionary war under outright lies, a corruption scandal in the House of Commons, an ex Israeli president jailed for rape, Senator “wide stance” and Congressman Weiner, and a French IMF leader on trial for sexually assaulting an African immigrant maid in a New York hotel, does the west have any moral compass anymore? Is nothing shameless, or a disgrace left? When did decency die in the west? When did we decide to return to Matilda and Stephen? Were our parents wrong for judging Germany, the USSR, and Japan as beyond the pale in their conduct?
“We are holiday makers, here to try and enjoy ourselves - we are not potential inmates of Guantanamo Bay, and should not be treated as such.”
| 'Paris Syndrome' strikes Japanese | |||
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A dozen or so Japanese tourists a year have to be repatriated from the French capital, after falling prey to what's become known as "Paris syndrome".
That is what some polite Japanese tourists suffer when they discover that Parisians can be rude or the city does not meet their expectations.
The experience can apparently be too stressful for some and they suffer a psychiatric breakdown.
Around a million Japanese travel to France every year.
Many of the visitors come with a deeply romantic vision of Paris - the cobbled streets, as seen in the film Amelie, the beauty of French women or the high culture and art at the Louvre.
The reality can come as a shock.
An encounter with a rude taxi driver, or a Parisian waiter who shouts at customers who cannot speak fluent French, might be laughed off by those from other Western cultures.
But for the Japanese - used to a more polite and helpful society in which voices are rarely raised in anger - the experience of their dream city turning into a nightmare can simply be too much.
----They were suffering from "Paris syndrome".
It was a Japanese psychiatrist working in France, Professor Hiroaki Ota, who first identified the syndrome some 20 years ago.
On average, up to 12 Japanese tourists a year fall victim to it, mainly women in their 30s with high expectations of what may be their first trip abroad.
The Japanese embassy has a 24-hour hotline for those suffering from severe culture shock, and can help find hospital treatment for anyone in need.
However, the only permanent cure is to go back to Japan - never to return to Paris.
http://news.bbc.co.uk/1/hi/6197921.stm
Cruise passengers tell of seven-hour security 'revenge' nightmare
Elderly passengers on board a luxury cruise have criticised US immigration officials after they endured a seven-hour security check.
By Andy Bloxham, and John Bingham 6:45AM BST 07 Jun 2011
It was billed as a chance to taste the “glitz and glamour” of Hollywood or enjoy VIP treatment in some of the most exclusive shopping areas in the world.
But when a group of 2,000 elderly British cruise ship passengers docked at Los Angeles for a short stop-off during a five-star cruise around America it was, in the words of one of them, more like arriving at Guantanamo Bay.
During their £10,000, two-and-a-half month “Alaska Adventure” tour from the Arctic to the Caribbean, the passengers on the luxury P&O liner Arcadia had become more than accustomed to passing US immigration with little formality.
By the time they docked at Los Angeles on May 26, for a one-day visit it was their 10th stop on US soil.
But when a handful of them questioned whether the lengthy security checks at the port were strictly necessary for a group of largely elderly travelers officials were not amused.
Although they had already been given advance clearance for multiple entries to the country during their trip, all 2,000 passengers were made to go through full security checks in a process which took seven hours to complete.
The fingerprints of both hands were taken as well as retina scans and a detailed check of the passport as well as questioning as to their background.
Passengers claim that the extra checks were carried out in “revenge” for what had been a minor spat over allegedly overzealous security.
They complain that they were “herded like animals” and made to stand for hours in temperatures up to 80F with no food or water or access to lavatories.
Some are said to have passed out in the heat while others were left confused and bewildered.
When one lady asked in desperation whether she could use a bathroom, one immigration official is said to have replied: “Do it over the side, we won’t mind.”
To compound the situation, the officials' computer broke down and further delays resulted.
The immigration delays forced P&O to extend the stay in LA by a day forcing it to cancel a later stop-off at Roatan, Honduras, scheduled for this week.
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"To till the ground was to plough the sea: the earth bare no corn, for the land was all laid waste by such deeds; and they said openly, that Christ slept, and his saints. Such things, and more than we can say, suffered we nineteen winters for our sins."
The Anglo-Saxon Chronicle. Matilda v Stephen.
The monthly Coppock Indicators finished May:
DJIA: +196 Up. NASDAQ: +249 Up. SP500: +200 Up.
The Dow and SP 500 and NASDAQ have all reversed from down to up. The Fed’s rigging of the indicators seems to have worked. Note: like all indicators, they were devised for normal markets not markets where the central bank is flooding the economy with new cash. In current conditions where risk is suspended by too big to fail, I doubt any indicators are showing more that where the Fed’s new cash is flowing in our world of casino capitalism. But the Fed’s QE program is supposed to end this month!!!
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