Baltic Dry Index. 2662 +23
LIR Gold Target by 2019: $3,000.
"If ever there was an area in which to do the exact opposite of that which government and the media urge you to do, that area is the purchasing of gold."
Robert Ringer
After a failed attempt at currency manipulation last week, Japan’s government appears to be panicking. Below the latest news from the land of the setting sun. Another 5 trillion yen is to be poured down the same rat hole that’s swallowed countless trillion yen over the last two decades, all so far in a futile attempt at rebuilding the golden decade of the 1980s bubble economy. An eerie trailer for the US economy to come? Not too worry, it’s only fiat yen and there’s plenty more where that comes from.
"The first requisite of a sound monetary system is that it put the least possible power over the quantity or quality of money in the hands of the politicians."
Henry Hazlitt
Japanese Cabinet OKs $61 Billion Economic Stimulus
By THE ASSOCIATED PRESS Published: October 7, 2010
TOKYO (AP) — Japan's Cabinet on Friday approved 5.05 trillion yen ($61 billion) in new economic stimulus, the latest in a string of measures to shore up the country's lethargic economy that has been battered by a surging yen.
The plan also called for funding to secure rare earths needed for Japan's advanced manufacturing after China last month imposed a de facto export ban on the minerals amid a territorial dispute between the two Asian giants.
Prime Minister Naoto Kan's new package aims to boost Japan's gross domestic product by 0.6 percentage points, create or save up to 500,000 jobs and take other steps to help small and medium sized businesses.
It comes just days after the central bank cut its key interest rate to virtually zero. Last month, the Bank of Japan also intervened in the currency market in what appears to have been a fruitless attempt to rein in the strong yen — which hit another 15-year high against the dollar this week.
Exports are down, factory output is falling and Japan continues to struggle with deflation, a situation in which falling prices can drag on corporate profits, paychecks and the overall economy. The yen's spike, meanwhile, erodes overseas earnings for major exporters like Toyota Motor Corp. and Canon Inc.
Kan, who came to power just four months ago and survived a leadership challenge from within his party in September, has been under heavy political pressure to produce a tangible path to recovery for Japan's economy.
The massive new package, to be submitted this month to parliament for approval, follows 915 billion yen ($11 billion) in measures that Kan's government unveiled last month.
More.
http://www.nytimes.com/aponline/2010/10/07/business/global/AP-AS-Japan-Economy.html
Staying with Asia, China OKs listing the yuan for electronic trading. Another small step towards making the yuan fully convertible. In another age, the big loser would be next door Japan’s yen. But this is not that other gentler, kinder, age, the early age when having just made the dollar a fiat currency, and with it every other currency on the planet which was linked to it by the 1944 Breton Woods Agreement, the fiat currency age of capitalism before casino capitalism and banksterism took over, displacing commerce and industry, replaced by insane derivatives gambling backed up by too big to fail, central bank crony bailouts. Still, the yuan will never become the world’s fiat currency replacing the failing US dollar. There’s absolutely no reason to think that China’s politicians would run a fiat yuan reserve currency any better than American politicians ran theirs.
"The history of paper money is an account of abuse, mismanagement, and financial disaster."
Richard M. Ebeling
OCTOBER 7, 2010
Yuan Goes Electronic In Global Market Bid
BEIJING—The Chinese yuan is going electronic, a sign of the growing interest generated by China's experiment in liberalizing offshore use of its currency.
ICAP PLC and Thomson Reuters Corp., which began allowing the yuan to trade on their electronic-trading platforms last week, said they are in discussions with banks in the U.S. and Europe about using the new systems. Neither company would identify the banks, but ICAP has handled several yuan trades a day that average roughly $2 million.
It is a small start, and the trading is limited to the relatively small pool of yuan circulating in Hong Kong. Still, the advent of electronic trading of the yuan and its likely expansion to traders beyond Hong Kong mark an important toward building the infrastructure to support a global market for the currency.
China's government has made a series of moves in the past year to encourage the yuan's use outside China, an effort to become less dependent on the dollar for trade and investment. The moves are allowing pools of yuan to accumulate in bank accounts outside of China, particularly Hong Kong.
Hong Kong banks have been trading the currency among themselves, but through over-the-counter trades where the banks contact each other directly or through brokers. The entry of companies such as ICAP and Thomson Reuters means that prices and trading amounts will be posted openly.
As power shifts from the west to east, thanks to President Nixon’s deranged adoption of fiat reserve currency and financial casino gambling, Gallup reports on the new reality in the USA, facing all not in an industry that’s a friend of the Fed. Is it any wonder that there’s revolution coming in America’s ballot boxes this November.
"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
October 7, 2010
Gallup Finds U.S. Unemployment at 10.1% in September
Underemployment, at 18.8%, is up from 18.6% at the end of August
by Dennis Jacobe, Chief Economist
PRINCETON, NJ -- Unemployment, as measured by Gallup without seasonal adjustment, increased to 10.1% in September -- up sharply from 9.3% in August and 8.9% in July. Much of this increase came during the second half of the month -- the unemployment rate was 9.4% in mid-September -- and therefore is unlikely to be picked up in the government's unemployment report on Friday.
Next, the run to gold has belatedly started and is being promoted by the bailed out banksters. They can see the end of fiat currency arriving this decade too.
"As fewer and fewer people have confidence in paper as a store of value, the price of gold will continue to rise."
Jerome F. Smith
Super-rich buy gold by the ton
The world's wealthiest people have responded to economic worries by buying gold by the bar by the ton.
Published: 8:07AM BST 05 Oct 2010
The world's wealthiest people have responded to economic worries by buying gold by the bar - and sometimes by the ton - and by moving assets out of the financial system, bankers catering to the very rich told Reuters, the news agency.
Fears of a double-dip downturn have boosted the appetite for physical bullion as well as for mining company shares and exchange-traded funds, UBS executive Josef Stadler told the Reuters Global Private Banking Summit.
They don't only buy ETFs or futures; they buy physical gold," said Stadler, who runs the Swiss bank's services for clients with assets of at least $50 million to invest.
UBS is recommending top-tier clients hold 7-10 percent of their assets in precious metals like gold, which is on course for its tenth consecutive yearly gain and traded at around $1,314.50 an ounce on Monday, near the record level reached last week.
"We had a clear example of a couple buying over a ton of gold ... and carrying it to another place," Stadler said. At today's prices, that shipment would be worth about $42 million.
Julius Baer's chief investment officer for Asia is also recommending that wealthy investors park some of their assets in gold as a defensive stance following a string of lackluster U.S. data and amid concerns about currency weakness.
"I see gold as an insurance," Van Anantha-Nageswaran told Reuters. "I recommend 10 percent as minimum in portfolios and anything more than that to be used for trading purposes, to respond to short-term over-bought or over-sold signals."
Below, one of the reasons the rich and anyone else with some sense are buying gold. The fiat money system finally went bust in 2008, we are just not yet prepared to admit it and that to reform the system, we need to write off globally multi trillions of non performing, unrepayable debt.
"Someone must stand up to those who say, "Here's the key, there's the Treasury, just take as many of those hard-earned tax dollars as you want."
President Ronald Reagan
Iceland Banks May Be Asked to Forgive $2 Billion After Protests
Oct. 8 (Bloomberg) -- Iceland’s banks may come under pressure to forgive about $2 billion in mortgage debt after protests this week prompted the government to consider proposals from the island’s homeowner protection group.
“The debt the banks have to write off could very well be very challenging for them,” said Economy Minister Arni Pall Arnason, in an interview in Reykjavik. “So be it. The banks have to acknowledge quickly that current debt levels are unrealistic and that timely write-offs are necessary. Full stop.”
The government is eager to show voters it is committed to reducing families’ debt burdens after the Oct. 4 unrest. The protests drew bigger crowds than in the weeks before former Prime Minister Geir H. Haarde’s administration was ousted in January 2009. The Interest Group of the Homes, which represents households demanding debt relief, says banks should write off about 200 billion kronur ($1.8 billion) in mortgage loans to help the 39 percent of homeowners who are technically insolvent.
Prime Minister Johanna Sigurdardottir held emergency talks after the protests, in which about 8,000 demonstrators gathered to express their anger over rising homeowner insolvencies. Sigurdardottir said her government isn’t ruling anything out.
http://noir.bloomberg.com/apps/news?pid=20601087&sid=aZG2npchHFCY&pos=7
"The London Banker Henry Fauntleroy forged to keep his bank solvent. He was executed for it in 1824."
Charles P. Kindleberger. Manias, Panics and Crashes.
At the Comex silver depositories Thursday, final figures were: Registered 52.25 Moz, Eligible 59.62 Moz, Total 111.87 Moz.
+++++
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
Below, more on America’s black swan. Greed and avarice drove the Greenspan Fed’s deliberately created real estate bubble, which they created to try to overcome the aftermath of their collapsed stock market and dot con bubble of the 1990s. Remember NASDAQ, “the stock market for the next 100 years”. It now turns out that much of the real estate bubble was fraudulent from top to bottom, though that didn’t stop Wall Street from slicing and dicing the mortgages into various classes of mortgage backed securities, with the top class falsely insured into “triple-A” status and peddled to the unsuspecting world.
Now that bubble has well and truly burst, and massive amounts of the mortgages have gone into default. But in typical modern US bankster style, the toxic trash was peddled furiously around the SIVs specifically created by the banksters to keep the unsalable worst trance of toxic trash off the bank’s balance sheets, without anyone bothering to pay for keeping the paperwork in order. Why pay the fees on filing the right title transfer paperwork with the counties, or pay a notary to record witnessing signatures when they could just be forged or ignored. The result is now after 200 years, to make US real estate titles little better than the convoluted mess of Latin American banana republic real estate titles. Below, the NY Times covers the growing story that will likely end in “the next Lehman”, and hopefully, jail time for some of the banksters. Thus did America surrender its privilege of running the world’s only fiat reserve currency and economic leadership in the world. Stay long precious metals. Banksterism replaced capitalism in America under Greenspan – Bernanke. Sadly this only gets worse ahead.
"It is the greenback which is unstable, and not the bullion."
Dr. Franz Pick
Flawed Foreclosure Documents Thwart Home Sales
By ANDREW MARTIN and DAVID STREITFELD Published: October 7, 2010
OCALA, Fla. — Amanda Ducksworth was supposed to move in to her new home this week, a three-bedroom steal here in central Florida with a horse farm across the road. Instead, she is camped out with her 7-year-old son at her boss’s house.
Like many buyers across the country, Ms. Ducksworth was about to complete the purchase of a foreclosed house when it suddenly went off the market. Fannie Mae, the giant mortgage holding company that buys loans from commercial lenders, is pulling back sales of homes that might have been foreclosed in bad faith.
“I gave up my rental thinking I would have a house,” said Ms. Ducksworth, a 28-year-old catering assistant. “Now I’m sharing a room with my son. What the hell is up with that?”
With home sales this past summer at the lowest level in more than a decade, real estate is ill-prepared to suffer another blow. But as a scandal unfolds over mortgage lenders’ shoddy preparation of foreclosure documents, the fallout is beginning to hammer the housing market, especially in states like Florida where distressed properties are abundant.
“This crisis takes a situation that’s already bad and kind of cements it into place,” said Joshua Shapiro, chief United States economist for MFR Inc., an economic consulting firm.
Three major mortgage lenders — Bank of America, GMAC Mortgage and JPMorgan Chase — have said they are suspending foreclosures in the 23 states where they first need a judge’s approval. They are also waving off Fannie Mae from selling any of the foreclosed homes whose loans they sold to Fannie.
The companies say they are reviewing their operations after disclosures that employees signed documents without determining the accuracy of the material, as is required by law.
Those reviews are throwing into limbo hundreds of thousands of foreclosures and pending home sales, analysts estimate, though the lenders and Fannie Mae have been mostly silent about precise numbers and other specifics.
More broadly, the revelations about the sloppy paperwork are emboldening homeowners and law enforcement officials in many states to question whether lenders rightfully hold the notes underlying foreclosed properties — further chilling the housing market.
Distressed properties, many of which are in foreclosure, make up about a third of all home sales. “Foreclosures are going to slow to a crawl,” said Guy D. Cecala, publisher of the trade magazine Inside Mortgage Finance.
Of the 23 states where foreclosures need court approval, Florida has by far the most trouble — about a half-million cases clog its courts — and the moratoriums are having a noticeable effect.
Because most lenders sold their mortgages to Fannie Mae, it is largely that company that has been sending e-mails to real estate agents about putting off deals and removing houses from the market. In most cases, the agents are being told the freeze will last 30 to 90 days, but agents say there is no way to know for sure.
A snapshot of the problems can be seen at the real estate agency that sold Ms. Ducksworth her home, Marc Joseph Realty, based in Fort Myers.
The agency had 35 deals that were supposed to close this month. As of Thursday, Fannie had postponed 11 of them. Another handful of homes that did not have offers or were being prepared for market had also been withdrawn.
“If this wipes out half my inventory, that’s a scary thing,” said Bill Mitchell, the agency’s closing coordinator.
As he spoke, his computer pinged and another message from Fannie came through about withdrawing a house. It had the subject line, “Unable to Market Notice.”
More
http://www.nytimes.com/2010/10/08/business/08frozen.html?_r=1&hp
Below, pass out the pitchforks, heat up the tar, open the barrel of feathers, and bring out the tumbrels, ZeroHedge exposes just how corrupt America’s real estate debacle has become.
Bombshell of Foreclosure Fraud – Full Deposition of TAMMIE LOU KAPUSTA Law Office of David J Stern
“The paper standard is self-destructive."
Hans F. Sennholz
Another weekend, and time to enjoy God’s gift to mankind. Our woods and hedgerows are crammed full of Autumn’s bounty. Fungi are approaching their peak, but only for the knowledgeable to pick. The sweet chestnut trees have commenced dropping their edible chestnuts, the elderflower bushes are brimming with berries, the sloe are in full fruit, the last of the crab apples are still on the trees. Sadly in modern dumbed down Britain, few even see this abundance let alone know what to do with it. Have a great weekend everyone. More on the blog at the weekend.
The monthly Coppock Indicators finished September:
DJIA: +227 Down. NASDAQ: +321 Down. SP500: +221 Down.
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. September is the fourth down month in a row.
