Baltic Dry Index. 910 -12
LIR Gold Target by 2019: $30,000. Revised due to QE programs.
The bankster in his mansion,
The depositor at his gate,
Draghi made them High or lowly,
He disordered their estate.
With apologies to All things bright and beautiful.
It’s Easter, and northern Europe is
undergoing the darkest, snowiest, coldest winter in decades, so what’s a German
Chancellor to do? Head out of freezing, hard working, tax paying, beer drinking
Germany, that’s what, and head down to tax cheating, work dodging, bunga bunga,
warm, wine drinking Italy. Never mind that half of Club Med is unemployed and
wants to spit in your drink, blaming Chancellor Merkel’s re-election needs as
trumping any serious attempt at sorting out the German imposed austerity
depression in Club Med. It just about sums up the bankruptcy of modern
leadership and the fast arriving end game in the Great Nixonian Error of fiat
money. Like Roman Emperors before them, Eurocrats and Europols have debauched
the currency in the name of creating the United States of Europe out of envy of
the United States of America. Stay long physical precious metals as an
inadequate but still effective hedge against our future. An economic dark age
is arriving across the G-7.
"The history of paper money is an account of abuse, mismanagement, and financial disaster."
Richard M. Ebeling
Angela Merkel fails to escape eurozone crisis on Italian holiday
German Chancellor Angela Merkel may have donned her bathing costume for a little relaxation on the Italian island of Ischia, but she has failed to escape the heat of the current eurozone crisis.
By
Josephine McKenna in Rome 4:32PM BST 31 Mar 2013
Mrs
Merkel was caught by the cameras as she had a private dip while holidaying with
her husband at Hotel Miramare on the island famous for its thermal baths off
the coast of Naples.
But
Stefano Caldoro, president of the local Campania region, urged the Chancellor
to consider the impact of the current economic crisis on those in difficulty
like failed businesses and young unemployed during her Easter holiday.
"Here
there are 10 young unemployed for every young one without work in
Germany," Mr Caldoro said in a video message published by Italian media.
The video
was entitled: "Welcome to our ever hospitable land Mrs Merkel. But now
look around you" and was aired with German subtitles.
In a
strongly-worded message Mr Caldoro said Italians could not tolerate a
"double-sided Europe" nor anti-German sentiment.
Next, more on the idiotic widespread damage
wreaked on Europe last week.
“At
the beginning of 2011, we had €25bn in deposits. Many of the remaining
depositors were persuaded to keep their money in the bank. This has cost many
of my colleagues their name and reputation. They did their job to protect the
bank and Cyprus."
Michalis Athanasiou formerly Laiki Bank’s executive director of risk.
Betray Your Bank Before Your Bank Betrays You
By Jonathan Weil Mar 28, 2013 10:00 PM GMT
What’s a Slovenian with several hundred thousand euros in the bank supposed
to do? Spread it out among at least a few different banks, that’s what. Or move
the money out of the country, while it’s still possible. Imagine what must be on the minds of any savvy depositors still left at Nova Kreditna Banka Maribor d.d., now 79 percent- owned by Slovenia’s government. It was one of only four lenders in October that failed the European Banking Authority’s latest capital-adequacy test, a ritual best known for how lax its standards are.
One that flunked was Bank of Cyprus Pcl, where uninsured depositors face 40 percent losses as part of the country’s bailout terms. Another was Cyprus Popular Bank Pcl, also known as Laiki Bank, where uninsured deposits will fare far worse and the bank is being shut.
Cypriot banks’ customers were complacent after uninsured
deposits went unscathed in Ireland, Greece, Spain and Portugal, the first euro-area
countries to seek international rescues. Slovenians won’t have that excuse
should their country be next.
More
“If
we remain bound by the Troika and the memorandum Cyprus’ destiny is already
foretold and there will be no future.”
House
of Representatives President Yiannakis Omirou.
Cypriot archbishop urges finance minister to quit
The head of Cyprus’ influential Orthodox Church has dealt a hammer blow to the island’s economic leaders by becoming the first major figure to call for their resignations.
By Denise
Roland 7:33PM BST 31 Mar 2013
Archbishop
Chrysostomos II, who had urged for eurozone exit over an onerous bail-out,
declared on Sunday that finance minister Michalis Sarris and central bank
governor Panicos Demetriades should step down after allowing the EU-IMF lenders
to devastate the island’s banking sector in return for a €10bn (£8.4bn) loan.
The
missive is the latest public criticism to come from the island’s religious
leader since his failed bid to avert a raid on Cypriot savings by offering the
church’s entire wealth to shore up the struggling economy.
His call
emerged a day after the central
bank unveiled much worse than feared measures on uninsured deposits -
those over €100,000 - in the island’s largest lender, Bank of Cyprus.
In an
arrangement which will see more than €100m wiped off the Cypriot Orthodox
Church’s assets, up to 60pc could be slashed from uninsured savings in the Bank
of Cyprus, while large depositors in the island’s other major lender Laiki Bank
stand to lose 80pc of anything over €100,000 as it is broken up and wound down.
More
In other news this April Fool’s Day, Ronald Reagan’s budget director warns of dire times ahead in the USA if the Fed ever tries to reverse quantitative easing. Stay long physical precious metals. The Great Nixonian Error of fiat money is coming towards its end.
Stockman Warns of Crash Of Fed-Fueled Bubble Economy
By Richard Rubin - Apr 1, 2013 5:01 AM GMT
The U.S.
economy is in a bubble inflated by “phony money” from the Federal
Reserve and will burst within a few years, warned David Stockman,
who was budget director for President Ronald Reagan.
In an essay published yesterday in the New York Times (NYT), Stockman wrote that the Fed’s quantitative easing policies in the aftermath of the credit crisis have flooded stock markets with cash even while the “Main Street economy” remains weak. The combination, he wrote, is “unsustainable.”
“When it bursts, there will be no new round of bailouts like the ones the banks got in 2008,” wrote Stockman, a former senior managing director at Blackstone Group LP (BX) and a former Republican congressman from Michigan. “Instead, America will descend into an era of zero-sum austerity and virulent political conflict, extinguishing even today’s feeble remnants of economic growth.”
Stockman, 66, is the author of “The Great Deformation: The Corruption of Capitalism in America,” which will be published April 2.
The Fed, led by Ben S. Bernanke, is purchasing $85 billion in assets every month. The Fed is leaving its key interest rate near zero while it tries to reduce unemployment below 6.5 percent and hold inflation below 2.5 percent.
----Among the other culprits Stockman blamed for what he termed a “state-wreck” are President Franklin Delano Roosevelt for weakening the gold standard in 1933, President Richard Nixon for removing the convertibility of dollars to gold and “lapsed hero” Alan Greenspan, the former Fed chairman, for keeping interest rates too low for too long.
Investors will sell, Stockman wrote, at any hint that the Fed is starting to remove assets from its balance sheet.
More
Finally some common sense enters the Libor rigging
fiasco. In such a loose methodology behind setting Libor, where banks were
asked to merely estimate where they thought they could borrow in the market,
theoretical damage is possible, but provable damage isn’t. How do you prove
what the correct Libor rate was, when no actual trades were involved.
Libor Suits by Bondholders Tossed Over Lack of Damages
By David Glovin - Apr 1, 2013 12:00 AM GMT
Banks including Bank of America Corp., Barclays Plc (BARC) and JPMorgan Chase & Co. (JPM) won dismissal of antitrust
lawsuits by plaintiffs claiming they were harmed by the rigging of the London
interbank offered rate. In more than two dozen interrelated cases before U.S. District Judge Naomi Reice Buchwald in New York, the banks were alleged to have conspired to depress Libor by understating their borrowing costs, thereby lowering their interest expenses on products tied to the rates.
While potential damages were estimated to be in the billions of dollars, the judge ruled the cases must be dismissed because of the inability of litigants that included brokerage Charles Schwab Corp. (SCHW), pension funds and other bondholders to show they were harmed. Buchwald, whose March 29 ruling allowed some commodities-manipulations claims to proceed to a trial, said that, while private plaintiffs must show actual harm, her ruling didn’t impede governments from pursuing antitrust claims tied to attempts to manipulate Libor.
“We recognize that it might be unexpected that we are dismissing a substantial portion of plaintiffs’ claims, given that several of the defendants here have already paid penalties to government regulatory agencies reaching into the billions of dollars,” Buchwald wrote. “There are many requirements that private plaintiffs must satisfy but which government agencies need not.”
----Buchwald dismissed the antitrust claims because the plaintiffs didn’t allege enough facts to show that they were harmed by the alleged misconduct. The judge dismissed some commodities-manipulation claims because they centered on transactions that were too long ago. Other such claims may proceed, she said.
Explaining
her decision to dismiss the claims after the regulatory settlements, Buchwald
said private cases must be “examined closely” to ensure plaintiffs are
“properly entitled to recover and that the suit is, in fact, serving the public
purposes.”
“The
broad public interests behind the statutes invoked here, such as integrity of
the markets and competition, are being addressed by ongoing governmental
enforcement,” she said.
More
“The problem with fiat money is that it rewards the minority that can handle money, but fools the generation that has worked and saved money.”
“Adam Smith” aka George Goodman.
At the Comex silver depositories Thursday final figures were: Registered 43.00
Moz, Eligible 121.16 Moz, Total 164.16 Moz.
Crooks and
Scoundrels Corner
The bent, the seriously bent, and the totally
doubled over.
After last week’s
BRICS summit in South Africa our brave, wobbly new century, suddenly isn’t so
Anglo-American centric as 1900 – 2008. Recognising that the dollar and the euro
are headed for disaster, the BRICS are now preparing for the day that comes
after.
"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
The BRICS Expose the West’s Hypocrisy
By William Pesek Mar 28, 2013 9:00 PM GMT
Who do they think they are, these upstart economies, Brazil, Russia, India,
China and South Africa?
That might sum up the feeling in the U.S., Europe and Japan as the BRICS nations consider a new development bank that might challenge the World Bank and International Monetary Fund. The move brings to mind Alice Amsden, the Massachusetts Institute of Technology economist who died last year, and her 2001 book, “The Rise of ‘the Rest.’”
The richest nations can stew about this turn of events, as those on the periphery of the world economic system start seeing themselves as the core. Or developed countries can look in the mirror and consider how their actions have helped accelerate the shift.
Take Japan’s success in weakening the yen 17 percent in the past six months to help stimulate exports. It has prompted talk in China and elsewhere about a return to the currency wars. Concern about exchange-rate volatility that undermines trade and growth is a big reason the BRICS, the vanguard of “the rest,” want to use their combined $4.4 trillion of foreign-currency reserves to protect their economies and raise their international clout.
----It hasn’t escaped notice that Europe is being treated very differently from Asia in 1997. Back then, the IMF browbeat Asia into harsh reforms that deepened its crisis. It demanded higher interest rates, stronger currencies and fiscal tightening while forcing Thailand, Indonesia and South Korea to let weak banks fail.
When Malaysia imposed capital controls, it was demonized. Europe has gotten a pass on all of the above.
The same happened when Wall Street crashed a decade later. The U.S. Treasury Department stood by as regulators, banks and corporate leaders eschewed virtually every prescription it made to policy makers in Asia, Latin America and eastern Europe. That includes crony capitalism, as top bankers shift into senior roles in the federal government only to rotate back to Wall Street a few years later.
----Why isn’t the
IMF demanding as much from the Obama administration? Why is the IMF always
backing bailouts of a Greek economy that has learned nothing from its failings?
How come Cyprus, with an economy about the size of Vermont’s, has Lagarde’s
undivided attention in a world awash in financial and political risks?
Shouldn’t Group of Seven nations chastise Japan’s yen policies or Europe’s
denial about the magnitude of its troubles? You can see why the BRICS want
their own IMF, an institution that supports economies without the hypocrisy.
More
"Gold bears the confidence of the world's millions, who value it far above the promises of politicians, far above the unbacked paper issued by governments as money substitutes. It has been that way through all recorded history. There is no reason to believe it will lose the confidence of people in the future."
Oakley R. Bramble
The monthly Coppock Indicators finished March:
DJIA: +119 Up. NASDAQ: +132 Up. SP500: +157 Up.
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