Baltic Dry Index. 859 Wednesday
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
"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
We long ago left capitalism behind in the ash can
of history, embarking on the Great Nixonian Error of fiat currency, casino
derivatives gambling, and crony central bank socialism for the favoured
few. After the great stock market crash
of 1987, we embarked of the serial bubbles of the Greenspan “put,” which came
crashing to its end when America’s real estate bubble collapsed, wiping out the
Greenspan-Bernanke fraudulent “triple-A” securities racket. We have been in
perpetual crisis ever since. Now our world is turning ever more bizarre. After
robbing Peter to pay Paul in an ever more futile effort to recreate 2006, our
banksters have now resorted to robbing Paul to try to keep the Great Nixonian Error
on its last legs.
The latest plan seems to be to rob Europe’s nations
of what is left of their gold reserves. Reserves that will be badly needed once
the dying fiat currency reserve scam ends. They will be needed to back the new international
settlement system of the coming new order of new national currencies. We open today
with what being a member of the Bilderberger EUSSR means. Mass unemployment, no
prospects if you’re 15-24 and not a member of the bankster set.
Behold Europe, only slightly ahead of Japan and the
USA in the race to currency Armageddon. Stay long physical precious metals
adding more if the “troika” force a fire sale of Europe’s last remaining real
money.
"Gold would have value if for no other reason than that it enables a citizen to fashion his financial escape from the state."
William F. Rickenbacker
Greek unemployment hits a fresh record
Greece's unemployment rate scaled a new record in January as the country's downturn entered a sixth year, with young people among the worst hit, data has revealed.
Against a
backdrop of tough austerity measures imposed under its international bailout,
Greece's jobless rate has almost tripled since the country's debt crisis
emerged in 2009.
Unemployment
in January stood at 27.2pc, up from a revised 25.7pc in December, Greece's
statistics service Elstat said on Thursday.
Youth
unemployment - among those aged between 15 and 24 - edged further towards the
60pc mark, rising to 59.3pc in January, up from 51pc in the same month in 2012.
Joblessness
has trickled steadily higher in Greece as tax rises and spending cuts demanded
by its creditors take their toll on the embattled country. The economy is
expected to shrink 4.5pc this year.
More
EMU plot curdles as creditors seize Cyprus gold reserves
April 11th, 2013 16:41 Ambrose Evans-Pritchard
First they purloin the savings and bank deposits in Laiki and the Bank of
Cyprus, including the working funds of the University of Cyprus, and thousands
of small firms hanging on by their fingertips.Then they seize three quarters of the country’s gold reserves, making it ever harder for Cyprus to extricate itself from EMU at a later date.
The people of Cyprus first learned about this from a Reuters leak of the working documents for the Eurogroup meeting on Friday.
It is tucked away in clause 29. "Sale of excess gold reserves: The Cypriot authorities have committed to sell the excess amount of gold reserves owned by the Republic. This is estimated to generate one-off revenues to the state of €400m via an extraordinary payout of central bank profits."
This seemed to catch the central bank by surprise. Officials said they knew nothing about it. So who in fact made this decision?
Cypriots are learning what it means to be a member of monetary union when things go badly wrong. The crisis costs have suddenly jumped from €17bn to €23bn, and the burden of finding an extra €6bn will fall on Cyprus alone.
The government expects the economy to contract 13pc this year as full austerity bites. Megan Greene from Maverick Intelligence fears it could be a lot worse.
She says the crisis has reached the point where it would be “less painful” for Cyprus to seek an “amicable divorce” from the eurozone and break free.
Quite so, and while we’re at it, lets seek an amicable divorce for everybody, for Portugal, for Ireland, for Spain, for Italy, and above all for Germany, since they are all being damaged in different ways by the infernal Project. All are victims of their elites.
It is an
interesting question why Cyprus has been treated more harshly than Greece,
given that the eurozone itself set off the downward spiral by imposing de facto
losses of 75pc on Greek sovereign debt held by Cypriot banks.
And,
furthermore, given that these banks were pressured into buying many of those
Greek bonds in the first place by the EU authorities, when it suited the
Eurogroup.
----The creditor powers will go to extraordinary lengths to avoid sharing the costs.
We now
learn that one of those lengths is to seize gold reserves. So what will happen
as Portugal’s economy slides deeper into its contractionary vortex, and its
deficits remain stubbornly stuck near 6pc of GDP despite the fiscal cuts, and
its public debt hits 124pc of GDP this year?
Portugal
holds 382 tonnes of gold, the 14th largest holding in the world, and more than
either Britain or Spain. For the sake of delicacy, I will skip over the methods
by which Salazar acquired that gold.
So will
the Troika order Portugal to hand over these reserves if the country requires a
second bail-out, as deemed likely by a great number of analysts in the City?
Will they
impose savage haircuts on anybody with savings or operational funds above
€100,000 in Portuguese banks? Portugal’s banks may be healthy, but that is no
protection.
The
original plan in Cyprus – approved by the Eurogroup, but rejected by the
Cypriot parliament – was to steal the money from any bank regardless of its
health, and from small depositors regardless of the €100,000 guarantee. They
have shown their character. The Eurogroup don’t give a damn about moral hazard.
They are thieves.
More
Next, if Cyprus can be forced to sell off its gold
in order to remain in the snake bit euro, why not others? Why not force Italy
to dump its 2,451.8 metric tons of gold at fire sale prices just like dunce
Gordon Brown sold of half the UK’s gold reserves near the post 1980 low? The
answer is that Italy would probably rather leave the dying Bilderberger euro
project, rather than see all its gold head off to the Orient. But someone in
Washington and Brussels and Tokyo has a vested interest in trying to force down
the gold price. With the Great Nixonian Error of fiat currency coming apart at
the seams, gold, the only real currency in which to price the fiat currencies,
is now under attack from some very desperate central banksters. Stay long
physical precious metals and add more if the banksters get their way and force
Europe out of its only asset that will enable its recovery once the fiat
currencies fail.
"Until government administrators can so identify the interests of government with those of the people and refrain from defrauding the masses through the device of currency depreciation for the sake of remaining in office, the wiser ones will prefer to keep as much of their wealth in the most stable and marketable forms possible - forms which only the precious metals provide."
Elgin Groseclose
Analysis: If Cyprus can sell gold to help bailout, why not others?
LONDON |(Reuters) - Heavily indebted euro zone nations such as Italy and Portugal could come under pressure to put their bullion reserves to work as a result of plans for Cyprus to sell gold to meet its financing needs.
A European Commission assessment of what Cyprus needs to do as part of its European Union/International Monetary Fund bailout showed Cyprus is expected to sell in excess gold reserves to raise around 400 million euros ($523 million).
Other struggling euro area countries may be pushed to take note. Between them, for example, Portugal, Ireland, Italy, Greece and Spain, hold more than 3,230 metric tons (3561 tons) of gold between them, worth nearly 125 billion euros at today's prices.
The lion's share of that - 2,451.8 metric tons - belongs to Italy. But Portugal and Spain also hold hundreds of metric tons and gold is currently trading around $1,558.95 per ounce in spot terms, or 1,189 euros.
The metal makes up more than 90 percent of Portugal's foreign exchange holdings, and 72.2 percent of Italy's. India, by contrast, holds less than 10 percent of its reserves in gold.
Gold sales on their own would be far from a magic bullet to solve euro zone financing problems: Italy's entire gold reserves, for example, are worth less than 95 billion euros, against outstanding debt of around 1.685 trillion euros.
But the Cyprus situation shows that even a relatively small gold sale may help address severe debt problems. Cyprus' gold sale would allow it to easily come up with around 3 percent of what it must contribute to the bailout.
It is something that has the market somewhat concerned given that a big sale would push down the price. Central bank gold buying was one of the few areas of demand to increase last year at a time jewelry, coin and gold-bar buying was on the wane.
Indeed, spot gold posted its biggest one-day drop in nearly two months on Wednesday after news of the planned sale broke.
"Cyprus may be a one-off, (but) the market's concern will be that it isn't, and that other countries will be invited to sell their gold," one senior gold trader said.
"It's a potential game-changer for the market," he added. "Given we know that Portugal rejected the most recent austerity plan, and they have over 90 percent of the country's foreign exchange reserves in gold, does this mean that Portugal perhaps will be asked to sell some of its gold?"
Despite this, potentially hefty barriers lie in the way of central banks making sales to meet financing needs. Article 7 of the Protocol of the European System of Central Banks, for instance, guarantees central bank independence and freedom from government influence.
In other words, if a central bank doesn't want to sell its gold, in theory it can resist.
More
We end for the week with the IMF advocating QE
forever. A few days after the corrupt
Fed leaked its minutes to the chosen crony few, the IMF is running scared that
the Fed might actually think it can start to scale back on QE to infinity and
beyond.
The benefits of fiat currency were
all front loaded. We long ago dissipated whatever benefit my generation got.
The Great Graeme.
IMF raises concerns over QE 'cold turkey'
Loose central bank policies may threaten global financial stability when interest rates rise because lenders could become "addicted" to central bank financing and put off vital reforms, the International Monetary Fund has warned.
The IMF
said accommodative measures adopted by the Bank of England and other central
banks, such as low interest rates and quantitative easing, had helped to
stabilise the financial system.
However,
it warned that the longer these policies – dubbed "MP-plus" – were in
place, the greater the risk that negative effects could spill over to other
parts of the economy.
"Financial
stability risks may be shifting to other parts of the financial system, such as
shadow banks, pension funds, and insurance companies," the IMF said in a
chapter of its Global Financial Stability Report.
"Despite
their positive short-term effects for banks, these central bank policies are
associated with financial risks that are likely to increase the longer the
policies are maintained."
The IMF
found evidence that loose monetary policy "may be supporting a delay in
balance sheet cleanup in some banks", and could encourage them to
"evergreen", or roll over bad loans instead of recognising losses on
their books.
It said
that keeping so-called 'zombie' firms afloat could have an adverse effect on
banks. "It is difficult to identify weak but ultimately viable borrowers,
and such evergreening may be keeping non-viable firms alive," the IMF
said. "Their demise when rates rise could affect the quality of the loan
portfolio over the medium term."
Large
increases in bank liquidity associated with QE could make financial
institutions "addicted to central bank financing", the IMF said.
Asset purchases could also lead to a "sharp" jump in sovereign
borrowing costs once conditions improve, it added.
----According
to research by Bank of America, financial asset purchases by the US Federal
Reserve, European Central Bank and Bank of Japan will equate to between 30 and
60pc of their gross domestic product by the end of 2014. Almost $20 trillion
(£13 trillion) of the global government bond market now trades below 1pc.
More
"With the exception only of the period of the gold standard, practically all governments of history have used their exclusive power to issue money to defraud and plunder the people."
F.A. von Hayek
At the Comex silver depositories Thursday final figures were: Registered 41.00
Moz, Eligible 122.23 Moz, Total 163.23 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
Still think that
our finest economists, politicians, banksters and bureaucrats are up to the job
of playing God? Think again!
“Economics
is extremely useful as a form of employment for economists.”
J. K.
Galbraith.
Tobin Tax is madness for Europe, and economic war against Britain
France's experiment with the Tobin Tax has proved a spectacular flop. Its finance ministry admits that the scattershot levy on financial transactions has raised just a third of the money expected since August.
Total
takings will be a paltry €800m in 2013, but that overlooks the much greater
damage inflicted on French finance, industry and the government's own tax base.
"France is shooting itself in the foot," said Paul-Henri de La Porte
du Theil, head of French finance industry AFG.
Jean-Yves
Hocher from Crédit Agricole said it would cost his company €17bn. One French
banker told Les Echos that the tax was "a weapon of mass
destruction that is going to ruin our financial sector".
The
Bourse de Paris and the nexus of French funds in Paris was already in slow
decline even before this act of idiocy. Le Figaro fears that the entire
industry will now whither on the vine.
Nobody
seems to be listening to warnings, even when they come from Maya Atig, the
soft-spoken director of French debt agency. She said any revenue from the tax
would merely offset “the extra costs that we might have to pay” as liquidity
drains away and yield spreads rise. Instantly proving her right, Denmark's
€110bn pension fund ATP said it is no longer accepting French bonds as
collateral.
Italy has
not done much better since it launched its Tobin tax. Undaunted, 11 EMU states,
including Germany, will press ahead together in 2014, to the delight of
Singapore or New York. "Sheer madness," said Prime Minister David
Cameron.
One
wonders how much self-inflicted damage the eurozone can endure. Spot gas prices
are already four times higher than in the US. Energy prices as a whole are
three times higher. You might as well shut down the European chemical, steel
and glass industries.
Yet
France has a moratorium on shale gas. Germany is running down its nuclear
reactors, relying on a utopian dash for renewables and Baltic wind-power. Italy
says it won't touch shale or nuclear. Buona fortuna.
Euroland
is stumbling into ever deeper crisis, left behind in perma-slump as the growth
differential with the US becomes entrenched at 2pc to 3pc. We are literally
watching the moment when Europe loses its footing in the world.
More
I met a traveller from an antique land
Who said: Two vast and trunkless legs of stone
Stand in the desert. Near them, on the sand,
Half sunk, a shattered visage lies, whose frown,
And wrinkled lip, and sneer of cold command,
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed:
And on the pedestal these words appear:
"My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!"
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare
The lone and level sands stretch far away.
Who said: Two vast and trunkless legs of stone
Stand in the desert. Near them, on the sand,
Half sunk, a shattered visage lies, whose frown,
And wrinkled lip, and sneer of cold command,
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed:
And on the pedestal these words appear:
"My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!"
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare
The lone and level sands stretch far away.
Ozymandias.
Shelley.
Have a great weekend everyone. Be sure to have enough cash on hand in
case the banksters raid the banks.
The monthly Coppock Indicators finished March:
DJIA: +119 Up. NASDAQ: +132 Up. SP500: +157 Up. Another Fed bubble grows. For the adventurous,
with true risk capital, ridding this new bubble is a calculated risk as long as
the central banksters pursue QE and ZIRP. But remember, getting out early and
near first is the name of the game in trading bubbles.
No comments:
Post a Comment