Baltic Dry Index. 2981 -10
LIR Gold Target by 2019: $3,000.
“There is no example of a nation become rich by paying its debts. There are dozens of examples of nations becoming rich by defaulting or renegotiating.”
John Ralston Saul. A Doubters Companion: A Dictionary of Aggressive Common Sense.
We open today with the rise of the just default camp, in the world of sovereign debt. Since much of the debt was accumulated corruptly, between brain dead or venal politicians on the take, and great vampire squids aiding and abetting a crime on the public, just default, and let the great vampire squids take the heat and most of the loss. Kings and countries have been doing it since time immemorial, this time it’s not different after all. Why pay off the money lenders 100 pennies on the Pound, and at 6-7% interest in the case of the tax and work shy Greeks. It’s not real money after all, just meaningless fiat money pyramided off the currency of the world’s largest debtor that also can’t repay its debts. The great vampire squids will be back, begging to work out some sort of deal to return a restructured debt to the performing ledger.
The IMF Flag reads: ECONOMIC SLAVERY
By Nikos Katzilaki
“The IMF will not have a restricted role” in the recently decided support plan for Greece, because “it wants to insure the control of valuable Greek infrastructures”, alleges economic analyst Max Keiser on international television networks such as the BBC, Al Jazeera and Russia Today.
Often also called an activist, Mr. Keiser created quite a stir a few days ago when, on an Al Jazeera program, he claimed that Greece, for the past decade, has fallen victim to the “economic terrorists” of the Wall Street banking systems and the IMF. In the interview which followed, he claimed “if the Greeks want to be protected from the IMF, then they should nationalize their banks thus establishing government owned institutions so as to revive the banking system”, while at the same time “ceasing to pay back the loans which were issued illegally” via “cooking the books” of the Greek economy by Goldman Sachs. He proposed the expulsion from the country of American banks as well as the IMF. The consequence will be “two or three years of heavy recession”, during which time Greece will be able “to rebuild its economy”, ensuring its economic independence.
Mr. Keiser, what is your opinion concerning the EU decision to support Greece while also including the IMF?
“It is problematic solution, because the IMF isn’t a desirable institution of control for your finances as it will bring with it budget austerity measures which serve the interests of the Wall Street and not the Greek population. Greece has fallen victim to the Wall Street bankers since 2000. The first thing that needs to done is an assessment of the relationships between the Wall Street banks, Greek banks and the Greek government. If the Greeks want to be protected from the IMF, they should immediately nationalize all the banks thereby reviving the banking system and exempting themselves from the unfair austerity measures which are being imposed on them . The people are not the cause of the problem. Why is the Greek population being forced to pay for the actions of corrupt bankers and politicians? This is absurd”.More.
http://maxkeiser.com/2010/04/05/the-imf-flag-reads-economic-slavery/
I suspect that we will see far more of this sort of argument as the decade advances, possibly as early as next year if the west’s leading economies drop into a double dip recession. At some point ahead, the USA’s unfunded entitlements and trillion dollar a year new debts, make it a virtual certainty that the US must default or hyper-inflate away its 50 to 100 trillion dollar problem. For now, as with the banks operating on mark to the fantasy model accounting, we all go about pretending that solvency still exists. Just to set the record above straight, “The [Greek] people are not the cause of the problem” is not entirely true. While their politicians dodged and conned their way into fraud and massive debt, the tax and work shy Greeks got the free ride they were only too happy to take. Unlike the Icelanders who got unwittingly mugged by their own corrupt gambling banksters, the Greeks knowingly expected others to pick up the bill. That said, I suspect that the just default camp will grow and grow in the months ahead, the more so the deeper the austerity misery hits.
Below, the WSJ reports more bad news in commercial real estate, specifically in the retail sector. Despite the bad news, “The International Council of Shopping Centers trade group forecasts a 5.1% increase in retail sales in the first quarter over the same period a year earlier.” Perhaps, but I have my doubts it is a help. Unemployment and under-employment is stubbornly high, credit still contracting or nonexistent, home values are still falling, and the average hourly wage is stagnant or falling. Taxes are set to rise. Crude oil is back at $87 again, with many import prices likely to rise. Any increase in retail sales is likely founded on hapless Americans stuck with paying higher prices for gasoline and imported goods. The wrong sort of retail sales increase, I suspect.
APRIL 7, 2010
Shopping-Center Malaise
Vacancies Rise as Lease Rates Fall Again; Is Bottom Near?
Retail landlords continued to lower lease rates to attract tenants during the first quarter, revealing that optimism about a recovery in retail sales has yet to translate into gains for shopping-center owners.
Average lease rates at shopping malls during the first quarter were $38.79 a square foot annually, down 3% from a year earlier, according to real-estate research company Reis Inc. That was the sixth consecutive quarterly decline.
Lease rates at shopping centers, which are smaller than malls, declined to $16.62 in the first quarter, down 1% from the prior quarter and down 3.4% from a year earlier. It marked the seventh consecutive quarter in which shopping-center lease rates have declined.
Vacancy rates, meanwhile, continued to rise. Vacancy rates at malls in the top 77 U.S. markets rose to 8.9% in the January-to-March period, up one tenth of a percent from the previous quarter, according to Reis.
Still, the first-quarter increase was slight in comparison to earlier increases, suggesting that a bottom could be near.
"The stress might be lessening and rent declines might be moderating," said Reis director of research Victor Calanog. "But we don't see positive rent growth resuming until the middle of next year at the earliest, just because of the typical lag."
One reason why rising vacancies have started to slow is because discount stores are rapidly expanding, including Dollar General, as well as electronics chains like Hhgregg Inc. and apparel stores like Forever 21 Inc. That is offsetting some of the vacancies left by the failure of big-box retailers such as Linen N' Things and Circuit City.
Still, analysts believe it will be a couple of years before landlords can raise rents.
"Retailers have all the leverage in the lease negotiation, which makes it very hard for landlords to command higher rents," said Jim Sullivan, an analyst at Green Street Advisors. He added that landlords are signing new tenants at rents 25% to 40% below the rents paid by previous tenants.
Despite the pain for landlords, economists and others expect a recovery for retail sales beginning this year. The International Council of Shopping Centers trade group forecasts a 5.1% increase in retail sales in the first quarter over the same period a year earlier.
http://online.wsj.com/article/SB10001424052702304172404575168252332715066.html
Below, more sign of a spent out US consumer, or simply a wiser consumer awaiting for iPad II with all the bells and whistles and all the kinks worked out? I have no idea, and I’d bet that Apple doesn’t either. Still after all the months of hype and reviews, I suspect that if truth were known, Apple is pretty shocked at the relatively poor opening day response. Though I am very much in a small minority, I’m still not convinced that the iPad isn’t going to turn into an Edsel.
APRIL 6, 2010
First-Day Sales of Apple's iPad Fall Short of Sky-High Hopes
Apple Inc. said it sold more than 300,000 iPads in the U.S. on the first day the device went on sale Saturday, tempering Wall Street's highflying expectations for the much-hyped multimedia tablet computer.
While Apple didn't provide any iPad forecasts, expectations had been building steadily for blowout sales since Chief Executive Steve Jobs unveiled the product in late January. Last month, people familiar with the matter said Apple was seeing strong preorders of the iPad that even exceeded initial sales of the company's previous big hit, the iPhone.
Analysts on average had expected first-day iPad sales of 400,000 to 500,000 units. Some analysts, such as Piper Jaffray analyst Gene Munster, had even higher sales projections of 600,000 to 700,000 units. Estimates for global iPad sales this year ranged from 2.5 million by financial-services firm Kaufman Bros. to as high as 7.1 million by research firm iSuppli Corp.
But though buyers flocked to Apple stores on Saturday in the first hours after the device went on sale, the long lines petered out at many stores by midafternoon. On Monday, some Apple stores reported robust activity. An Apple store in San Francisco said it sold out of its first shipment of iPads on Monday morning, and a small line formed to buy the second shipment that had just arrived.
Some consumers such as Hans Van Der Weive, a property developer from the Netherlands, bought the iPad, which starts at $499, on impulse. "I just arrived here on holiday, I saw the shop and decided to buy one," said Mr. Van Der Weive, adding that he planned to use the device mainly for reading digital books.
How well the iPad will sell in the long term will likely stay unclear for at least another few quarters. Some of Apple's biggest products have previously had relatively slow starts. The iPhone, which has sold a total of more than 42.5 million units, sold 270,000 units in the first 30 hours of sales when it was launched three years ago. That was almost half of analysts' expectations at the time.
-----Apple also said on Monday that it would hold a special event on Thursday for "a sneak peak" of the next-generation iPhone operating system, which runs on the iPhone, iPod touch and iPad. Apple watchers expect the new operating system to offer new features and more closely integrate iPad functions.
http://online.wsj.com/article/SB10001424052702304017404575165621713345324.html?mod=WSJ_hp_mostpop_read
We end for today, with the great vampire squid giving its side of doing “God’s work” on earth. God, apparently wanted them to bankrupt Greece and put millions of Americans out of work and in upside down homes until the eviction posse shows up. “God made me do it” makes an interesting change from “the devil made me do it,” I suppose. Even for a shameless Wall Street cowed by nothing, taking on God seems a little rash even for Goldman.
“Goldman countered by announcing that it was giving $500 million away to 10,000 small businesses while a number of Congressmen called for Geithner’s resignation.
The response was again not positive. Mark Gilbert, the London bureau chief for Bloomberg, wrote:
“Here’s another way of looking at this sudden burst of supposed generosity. Goldman has $16.7 billion stashed in its bonus pot from the record profit earned in the first nine months of the year, which works out at $527,192 per staffer.”
“That means those 10,000 small businesses the securities firm says it wants to help are worth the equivalent of about 1,000 Goldman employees. Alternatively, a Goldmanite’s average contribution to society is pitched at the equivalent of 10 small enterprises, based on that bonus-versus-charity calculation.”
“Even at the Stakhanovite work rates the firm legendarily squeezes out of its staff, that’s quite a stretch. The idea that one banker is worth 10 businesses is the kind of math that got us into this mess, with finance falsely elevated until it became an end in itself, rather than a means to providing services to the real economy.”
http://solari.com/blog/?p=5143
APRIL 6, 2010
Goldman Tells Its Side of '09
Shareholder Letter—Firm's Longest—Defends Client Commitment, AIG Dealings
The year 2009 was one that some Goldman Sachs Group Inc. executives would like to forget. Yet the firm is reliving some of its biggest controversies in its longest-ever annual letter to shareholders.
The eight-page note, released Wednesday, presents Goldman's point of view directly to shareholders ahead of the firm's May 7 annual meeting. For example, criticized for putting the bank's own interests ahead of customers, Goldman Chairman and Chief Executive Lloyd Blankfein and President Gary Cohn say in the letter that clients are at the top of the pecking order.
The two executives used the words "client" or "clients" a total of 56 times, up from 17 in their 2008 shareholder letter.
"The firm's focus on staying close to our clients and helping them to navigate uncertainty and achieve their objectives is largely responsible for what proved to be a year of resiliency across our businesses, and by extension, a strong performance for Goldman Sachs," the executives wrote.
Goldman reiterated that it didn't "bet against" clients using short positions it took on before the residential real-estate market crashed. Goldman was one of the first Wall Street firms to reduce its real-estate exposure, even as some clients were sticking with their bullish bets. The short positions "served to offset our long positions," Messrs. Blankfein and Cohn wrote in the letter.
"Our goal was, and is, to be in a position to make markets for our clients while managing our risk within prescribed limits."
"We thought it was important to discuss our business, the opportunities we see through our work with our clients and various issues that merit broader discussion and a presentation of the facts, particularly in the last year," said Goldman spokesman Samuel Robinson.
Few shareholder letters get much attention, other than Warren Buffett's yearly note to Berkshire Hathaway Inc. investors. But as this year's annual-meeting season approaches, some analysts and investors are paying close attention to shareholder letters. Some financial-company CEOs are using the letters to clear the air about controversies that erupted during the financial crisis, from compensation to their responsibilities in return for receiving government aid.
Earlier this month, J.P. Morgan Chase & Co. Chairman and CEO James Dimon wrote a 36-page letter to shareholders of the New York bank, blasting the "demonization" of big firms. Mr. Dimon added that "some businesses require size in order to make necessary investments, take extraordinary risks and provide vital support globally." J.P. Morgan's letter last year was 28 pages long; Goldman's 2008 letter was just four pages.
Goldman's letter includes explanations of its payouts to employees and trading relationship with insurer American International Group Inc. More than one page is devoted to AIG. Goldman is under the public microscope for receiving nearly $13 billion from AIG after the insurance giant was bailed out by the government in 2008. In the case of the $13 billion, Goldman says it didn't retain much of the money, using it instead to meet various AIG-related obligations
Messrs. Blankfein and Cohn wrote that the firm's "direct economic exposure" to AIG was minimal, though Goldman and other companies benefited from the rescue because a failure of AIG would have been "extremely disruptive to the world's already turbulent financial markets."
http://online.wsj.com/article/SB10001424052702304172404575168382387679158.html
“As all businessman know, contracts are to be respected whenever possible. When not possible, regulations exist to aid default or renegotiation. Businessmen regularly do both and happily walk away.”
John Ralston Saul. A Doubters Companion: A Dictionary of Aggressive Common Sense.
At the Comex silver depositories Tuesday, final figures were: Registered 53.78 Moz, Eligible 62.67 Moz, Total 116.45 Moz.
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Crooks & Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
Today it’s the odds on the crooks and scoundrels running for the UK’s House of Crooks. Below, the UK’s serfs get put in their proper place by the Kingdom of Fife’s, Stalin MacBroon.
‘I want to renew the contract between the people and those THEY are sworn to serve’?
Prime Minister Gordon Brown. April 6, 2010.
General Election 2010: Bookmakers expect record £25m of election bets
Bookmakers are expecting a record £25m of bets on the tightest election for a generation – though that will still only be one tenth of the sum gambled on Saturday's Grand National.
By Alistair Osborne, Business Editor (Leisure) Published: 6:00AM BST 07 Apr 2010
As the tapes rose on Tuesday on the race to Number 10, bookies unveiled a wide field of wagers ranging from most seats and winners of all 649 constituencies to the next chancellor and the date for Gordon Brown's resignation.
Much betting interest so far has focused on a hung Parliament – though the odds have lengthened in recent days on both betting exchange Betfair and with traditional bookies, such as William Hill and Ladbrokes. Betfair has no overall majority at 2-1 and Ladbrokes at 15/8, though Hills is only 6/4.
William Hill spokesman Graham Sharpe said the bookie's biggest election bet so far was a £9,000 wager, but added: "Like in football, the high-rollers don't usually come in until a minute before kick-off. If you're betting in six figures, you want to make sure no-one says anything really stupid on a televised debate."
Ciaran O'Brien, Ladbrokes' spokesman, said "the betting is as volatile as the opinion polls" boosted this time by being "a genuine contest".
There could yet be a re-run too. Hills offers 3/1 on two elections this year – though you can get twice those odds on Betfair.
http://www.telegraph.co.uk/news/election-2010/7560832/General-Election-2010-Bookmakers-expect-record-25m-of-election-bets.html
Odds Checker. UK General Election Betting.
http://www.oddschecker.com/specials/politics-and-election/next-uk-general-election/most-seats
General Election 2010: Markets nervous after opening political shots
Britain's business leaders have warned of a month of market volatility ahead of the General Election unless the political parties offer more coherent plans on cutting the £167bn deficit.
By Louise Armitstead, Chief City Correspondent Published: 9:55PM BST 06 Apr 2010
The pound fell against the dollar and the euro on Tuesday as the opening election moves failed to convince traders that there will be a clear winner. Analysts also warned that sterling could come under further pressure over the next month unless the polls start to discount the possibility of a hung Parliament.
The pound, which has fallen 10pc against the dollar so far this year, was down 0.71 cents to $1.5201. Despite fears over the Greek debt crisis, the euro rose 0.2pc against the pound to 88.35p.
-----One trader said: "It's been a phoney war for months and the markets are all over the place. We just need some details to work from, not just this wish-list stuff, or it's just going to get worse over the next few weeks."
Ratings agencies have already warned that the UK's prized top AAA credit rating is under threat unless a credible fiscal plan is put forward soon after the election.
-----Meanwhile, the Bank of England seemed alone in being inconvenienced by the election date. The Monetary Policy Committee said it would postpone its May 6 interest rate decision to May 10.
http://www.telegraph.co.uk/news/election-2010/7561085/General-Election-2010-Markets-nervous-after-opening-political-shots.html
National debts are treated today as if they were unforgiving gods with the power to control, alter and if necessary destroy a country. This financial trap is usually presented as if it were peculiar to our time, as well as being a profound comment on the profligate [adj 1 shamelessly immoral 2 recklessly extravagant] habits of the population. The reality may be less disturbing.
1. The building up of unsustainable debt loads is a commonplace in history. There are several standard means of resolving he problem: execute the lenders, exile them, default outright or simply renegotiate to achieve partial default and low interest rates.
John Ralston Saul. A Doubters Companion: A Dictionary of Aggressive Common Sense.
The monthly Coppock Indicators finished March:
DJIA: +168 UP. NASDAQ: +370 UP. SP500: +196 UP. The great Bull market goes on with the all three continuing higher in positive numbers.
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Help the LIR fight Banksterism, the EU, and for sound money.
If you can, help the LIR stay around and make a difference. Please make a donation at the PayPal link on the website or better still become a sponsor for what looks like an exciting 2010. Capitalism not banksterism.
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Sunspots – A 22 year colder world? (From 2004?)
Spotless Days April 06
Current Stretch: 0 days
2010 total: 6 days (6%)
2009 total: 260 days (71%)
Since 2004: 776 daysTypical Solar Min: 485 days
http://www.spaceweather.com/
The long minimum seems to have ended.
New Solar Cycle Prediction
http://science.nasa.gov/headlines/y2009/29may_noaaprediction.htm
Is the Sun Missing Its Spots?
http://www.nytimes.com/2009/07/21/science/space/21sunspot.html?8dpc
Are Sunspots Different During This Solar Minimum?
-----But something is unusual about the current sunspot cycle. The current solar minimum has been unusually long, and with more than 670 days without sunspots through June 2009, the number of spotless days has not been equaled since 1933.
----During the period from 1645 to 1715, the Sun entered a period of low activity now known as the Maunder Minimum, when through several 11- year periods the Sun displayed few if any sunspots. Models of the Sun's irradiance suggest that the solar energy input to the Earth decreased during that time and that this change in solar activity could explain the low temperatures recorded in Europe during the Little Ice Age.
----The same data were later published [Penn and Livingston, 2006], and the observations showed that the magnetic field strength in sunspots were decreasing with time, independent of the sunspot cycle. A simple linear extrapolation of those data suggested that sunspots might completely vanish by 2015.These observations caused researchers to wonder whether the characteristics of sunspots are different now than in other solar cycles.http://www.leif.org/EOS/2009EO300001.pdf
Big freeze could signal global warming 'pause'
The Arctic conditions which have brought Britain to a standstill over the past week could be the start of a "pause" in global warming, some scientists believe.
Published: 9:20AM GMT 11 Jan 2010
http://www.telegraph.co.uk/earth/environment/globalwarming/6965342/Big-freeze-could-signal-global-warming-pause.html
Sunspot cycle 24: Together with sunspot cycle 25, the next two global cooling cycles. The new “Dalton Minimum?” Twenty Nine months now with low sunspots numbers, and counting. March was the 29th month of yet another low number of 15.4 http://en.wikipedia.org/wiki/Dalton_Minimum
Smoothed sunspot numbers (SSN). 2007, Oct. 0.9. The end of cycle 23.
Sunspot cycle 24: Nov 1.7. Dec 10.1. Jan 3.4. Feb 2.2. Mar 9.3 April 2.9. May: 2.9. June 3.1. July 0.5. August 0.5. Sep 1.1 Oct. 2.9. Nov. 4.1 Dec 0.8. Jan 1.5. Feb 1.4. Mar 0.7. Apr 1.2. May 2.9. June 2.6. July 3.5. Aug. 0.0. Sep 4.2. Oct 4.6. Nov 4.2. Dec 10.6 Jan 13.1 Feb 18.6 Mar 15.4.
Sunspots. http://solarscience.msfc.nasa.gov/SunspotCycle.shtml
The count. http://sidc.oma.be/products/ri_hemispheric/
Why a New Minimum. http://sesfoundation.org/dalton_minimum.pdf
The “Carrington Event,” September 1, 1859.
http://science.nasa.gov/headlines/y2008/06may_carringtonflare.htm
Current Space Weather.
http://www.swpc.noaa.gov/
What happened to global warming?
http://news.bbc.co.uk/1/hi/sci/tech/8299079.st
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This week’s featured links: Silver & Gold Miners + Rare Metals.
With US trillion dollar deficits stretching as far as the eye can see, and voodoo economics the order of the day at the central banks, I think it is now time to begin selectively scaling into precious metals companies that mostly meet the following criteria:
Adequate cash reserves. Good management. Strong in-ground reserves or prospects. NAFTA based, or else located in countries with strong rule of law.
Endeavour Silver Corp. TSX: EDR. http://www.edrsilver.com/s/Home.asp
Semafo TSX: SMF http://www.semafo.com/home_company_intro.php
ATW Gold Corp. TSX.V: ATW. http://www.atwgold.com/
US Silver Corp. TSX.V: USA. http://www.us-silver.com/s/Home.asp
Excellon Resources Inc. TSX: EXN. http://www.excellonresources.com/
First Majestic Silver Corp. TSX: FR http://www.firstmajestic.com/s/Home.asp
New Jersey Mining Company. OTCBB: NJMC
http://www.newjerseymining.com/index.html
Atna Resources Ltd. TSX: ATN. http://www.atna.com/s/Home.asp
Barkerville Gold Mines TSX.V: BGM. Formerly International Wayside Gold Mines Ltd.
http://www.barkervillegold.com/s/Home.asp
Shoreham Resources Ltd. TSX-V: SMH
http://www.shoreham.ca/
ATAC Resources Ltd, TSX.V: ATC. http://www.atacresources.com/s/home.asp
Evolving Gold Corp. TSX.V: EVG http://www.evolvinggold.com/
Lydian International Ltd. TSX: LYD. Note: LYD operates in Armenia, a region carrying higher risk than our usual safer picks in NAFTA lands. http://www.lydianinternational.co.uk/
The story of rare earths and metals is mostly one of China producing and exporting, Japan, America and everyone else importing. Vital to our new technologies, and lifestyle, and critical to hybrid and electric cars, Rare Earth Elements and Heavy Rare Earths, are a strategic choke point held in China’s hands. Lately China has been squeezing that choke point. I think that AVL at Thor Lake Canada, has a property of global importance. A property with the ability to offer NAFTA access to REEs and HREs for the decades ahead. As America and the west move to reduce over dependence on oil from unstable regions, we will see demand for rare metals take off.
Avalon Rare Metals Inc. TSX: AVL. http://www.avalonraremetals.com/
We will be adding more REEs as appropriate.
Warning.
Sadly we are all in unexplored territory. The world has never before suffered a severe recession/depression while operating on fiat currency. As is widely apparent, the central banks haven’t a clue and are making up the rules as the flounder along. They never saw it coming they claim, although it was obvious to many fine writers though not unfortunately in the mainstream media, that a giant financialised derivatives gambling economy would always end badly. There are no experts now, for the simple reason that we have never before faced such a sudden synchronised and deep collapse in the global economies.
The unfortunate fact that we are operating on fraudulent currencies is highly likely to mean it all ends many months from now, in a fiat currency revulsion, but only after the monetary authorities have first tried pouring in endless amounts of newly created money. A derivatives gambling world with an estimated quadrillion dollars of face value has to be unwound and the losses absorbed. In this sort of investing environment, cash, gold and silver and tangible assets are favoured over stocks and intangible assets.
As always if thinking about making an investment, it’s important to do one’s own due diligence. No one has more at risk in an investment than you do yourself. In these difficult economic times, there will likely be several false bottoms before the real one arrives and hindsight allows us to confirm that the bottom is in. Even then, a “V” shaped rebound is highly improbable. A double dip recession seems likely. Beware the false "statistical" government subsidised "recovery." It is a "recovery" bought from a future of fiat currency collapse.
Graeme Irvine
London Irvine Report: www.londonirvinereport.com/
Graeme@londonirvinereport.com
Wednesday, 7 April 2010
Tuesday, 6 April 2010
"Intellectual Muscles."
Baltic Dry Index. 2991 -07
LIR Gold Target by 2019: $3,000.
“When I am asked for a detailed forecast of what will happen in the coming months or years I remember Sam Goldwyn 's advice: "Never prophesy, especially about the future." (Interruption from the floor) Never mind, it is wet outside. I expect that they wanted to come in. You cannot blame them; it is always better where the Tories are.”
Margaret Thatcher. October 1980.
We open for the day readying for trouble in South Africa. South Africa appears to be heading off on the road to Zimbabwe. Bad news for mining companies in South Africa is very good news for competing mining companies in safer more stable countries elsewhere. My guess is that Canada, Australia, and Latin America will gain at South Africa’s expense. My guess is that excellent mining companies like Canada’s SEMAFO (TSX: SMF) operating in west Africa will be prominent among the gainers. Interestingly, SEMAFO is in the early stages of exploring with governments in the region the possibilities for solar power. While it’s too early to say if this “green energy” possibility will lead to a pilot project, it’s another sign of our world on the threshold of great change. Below, the Telegraph covers South Africa on the edge of resource nationalism abyss.
“We must find new lands from which we can easily obtain raw materials and at the same time exploit the cheap slave labor that is available from the natives of the colonies. The colonies would also provide a dumping ground for the surplus goods produced in our factories.”
Cecil Rhodes.
Mining groups fear backlash in South Africa
London-listed mining companies are bracing themselves for a wave of ethnic violence in South Africa as tensions escalate following the murder of notorious far-right politician Eugene Terreblanche.
By Garry White Published: 10:05PM BST 04 Apr 2010
The white supremacist leader was hacked to death at his Transvaal farm on Saturday – the same day that a senior member of the African National Congress (ANC) called for the nationalisation of all South Africa's foreign-owned mines.
Speaking in Zimbabwe on Saturday, Julius Malema, leader of the influential ANC Youth League, said South Africa's mines should be returned to black ownership.
"They have exploited our minerals for a very long time. We want the mines, now it's our turn," Mr Malema said.
Most of the UK-listed miners have significant interests in South Africa, particularly Anglo American, but Rio Tinto, BHP Billiton and Xstrata all have major assets within the country. Anglo American has majority stakes in many of the country's miners, including Anglo Platinum and Kumba Iron Ore. These four mining companies make up more than 10pc of the FTSE 100.
Widespread violence could lead to disrupted mine output, analysts said, potentially causing spikes in some commodity prices.
"This is one of the biggest threats to the South African mining industry today," one senior executive told The Daily Telegraph, although they declined to be named.
According to the South African Department of Minerals and Energy, the country has about 85pc of global reserves of platinum, which is used to make catalytic converters for vehicles.
It also has almost 80pc of the world's reserves of manganese and 73pc of global chrome stocks, which is used in the manufacture of stainless steel.
The country also has significant reserves of gold, zirconium and titanium.
"If South Africa adds to the problems it already has, investment is going to go elsewhere," John Meyer, head of mining at broker Fairfax said.
-----The outspoken Mr Malema, who has praised the farm seizures of Robert Mugabe, is widely blamed for stoking violence against white farmers after singing a controversial apartheid-era song which includes the line "kill the Boer".
He has been calling for nationalisation for the last three months, prompting Susan Shabangu, South Africa's respected mining minister, to say that a state takeover of the industry would not happen "in her lifetime". She said that Mr Malema was merely stretching his "intellectual muscles".
In the face of rising concern among foreign investors, Jacob Zuma, South Africa's president, refuses to rein in Mr Malema. He argues that South Africa is a free country and all citizens and can do and say as they please.
http://www.telegraph.co.uk/finance/newsbysector/industry/7554120/Mining-groups-fear-backlash-in-South-Africa.html
In other news this morning, the IMF is about to recommend the G-20 adopting and implementing a bankster “excess profits tax.” PIIGS will fly first I suspect. The banksters, who’d sell their own granny for the fat she would yield, will move heaven and earth to change any government rash enough to do any such thing, I suspect. Below, the Telegraph covers the IMF’s “pie in the banksters eye” fantasy, to mangle a metaphor.
The bankster Duke of Dunstable had one-way pockets.
He would walk ten miles in the snow to chisel an orphan out of tuppence.
With apologies to P.G. Wodehouse.
IMF targets banks with 'excess profits tax'
The International Monetary Fund is poised to recommend an unprecedented new "excess profits tax" on banks worldwide.
By Edmund Conway, Economics Editor Published: 10:24PM BST 05 Apr 2010
The Fund is expected to suggest the tax – which is effectively on banks' cashflow – as one of the best ways governments can raise significant amounts from banks without drastically distorting the financial system.
The tax will be announced alongside the Obama-style banking levy, which the IMF will also rubber-stamp in its report, to be published at its spring meetings this month.
The IMF was commissioned by the Group of Twenty leading economies last year to investigate new taxes on banks.
Although most attention initially was on so-called Tobin taxes, which levy small charges on banks' financial transactions (a model promoted by campaign groups as the Robin Hood Tax), the Fund is likely to rule them out as a serious prospect. The move is likely to frustrate Gordon Brown, who threw his weight behind the transactions tax in the early stages of the research.
Most had assumed that this would mean the Fund would give its central recommendation to a form of balance sheet levy, which has already been implemented in Sweden, and which has been proposed by the Obama administration.
However, the Fund is also considering giving an equally-important recommendation to a less well-known type of tax which simply levies a charge on bank profits, beyond a certain level.
The advantage of the balance sheet levy is that it should encourage banks not to build excessively large stocks of assets, as Royal Bank of Scotland famously did ahead of the crisis. The benefit of the excess profits tax is that it is thought to be the most efficient way to raise money from banks, and could in time replace regular business taxes as the best way of generating revenue from financial institutions.
-----Peter Spencer, economic adviser to the Ernst & Young Item Club, said: "The problem with an excess profits tax would be that it is very difficult to draw a dividing line between one kind of industry – which does pay the tax – and another that doesn't. Migration and effectively avoidance are the things which would make it very difficult. Also, the last thing you want to do is to deter people from making profits."
Britain toyed with an excess profits tax during the Second World War, although the use of such a system in a specific industry would be unprecedented.
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7557409/IMF-targets-banks-with-excess-profits-tax.html
Far away in a land where taxes and work are optional, most jobs are no-show jobs provided by the government and paid for by Brussels levies on hardworking Germans and Brits, and the sun never stops shining, the locals have started moving their money to the gnomes of Switzerland, home of the mega bank UBS, the Scarlet Pimpernel banksters with a contempt for other countries tax laws. Easy going, slothful but filthy rich Greeks might want to reconsider their choice of safe haven for their tax free, ill-gotten gains. Faced with going to a US guillotine or ratting out their US tax evading clients, the Scarlet Pimpernel in this 21st century edition, has just done a deal to walk away and rat out the American tax cheat aristocracy. I doubt that the Greeks will fare much better, when the German’s get forced into bailing out tax shy Greece.
They seek him here, they seek him there
Those taxmen seek him everywhere
Is he in heaven or is he in hell?
Or is he in a Geneva tax motel?
With apologies to Baroness Orczy. (Charles Dickens surely!)
Greek banks hit by wealthy citizens moving their money offshore
Greek banks are being hit by a wave of redemptions as the country's most wealthy citizens and corporations look to move their money offshore or to international financial institutions perceived as safer homes for their assets.
By Harry Wilson Published: 10:13PM BST 05 Apr 2010
Wealthy Greeks and companies have been clamouring to move their cash deposits to banks such as HSBC or France's Société Générale, which operate large branches in the country. They are among those to have received several billion euros of new money in recent weeks.
HSBC's private banking in the country is understood to have been flooded with business, while the local operations of several other major international banks have already seen large inflows of money. A spokesman for HSBC declined to comment.
Eurozone countries are still at loggerheads on bailing out the southern European nation, with Germany believed to be in conflict with other countries in the single currency over how much interest to charge on the emergency loans package. Germany wants interest rates of 6pc to 6.5pc, with other countries willing to accept 4pc to 4.5pc interest.
More than €3bn (£2.6bn) of deposits held by Greek households and companies left the country in February, while in January about €5bn of deposits were moved out, according to the latest figures available from the Bank of Greece.
Switzerland, the UK and Cyprus have been the largest recipients of the money, with the wealthiest Greeks looking to move their deposits to Swiss banks accounts to escape the more punitive tax measures many fear will be introduced in the wake of the country's economic crisis.
John Raymond, a banks analyst at CreditSights, said that on a visit to Athens last week capital flight was the number one issue worrying most Greek bankers.
"The banks themselves are concerned by it because they can't get funding elsewhere at the moment," he said.
"Greek banks won't be able to increase lending volumes if deposits don't increase, and a continued deterioration in their deposit base will lead them to cut back lending even more, stifling real economic growth."
http://www.telegraph.co.uk/news/worldnews/europe/greece/7557213/Greek-banks-hit-by-wealthy-citizens-moving-their-money-offshore.html
We end for the day with “the man who saved the world” twice, heading over to Buckingham Palace to ask the Queen to dissolve “the Crooked Parliament” of 2005-2010, to be renamed Brown Palace in the Old Labour plans for a socialist people’s republic, in the unlikely event that Stalin MacBroon and Bob Crow, leader of the Rail, Maritime and Transport union, get returned to power in the coming general election in Britain. Stay long precious metals, but outside of UK jurisdiction.
They're changing PM at Buckingham Palace -
Gordon Brown went down with Alice.
A face looked out, but it wasn't the Queen’s.
"She's much too busy packing things,"
Says Alice.
With apologies to A.A.Milne.
April 6, 2010
Fiercely contested election campaign begins today
Gordon Brown will travel the mile from Downing Street to Buckingham Palace today and launch the most fiercely contested election campaign for a generation.
He will ask the Queen to dissolve Parliament next Monday and will name May 6 as the day voters decide his fate.
Within minutes the frenzy of electoral combat will begin. Mr Brown will make a symbolic trip to the South East, showing his determination to hold on to new Labour gains of 1997. David Cameron will head in the opposite direction, taking the fight to Labour in the Midlands and the North.
The formalities between the Prime Minister and the monarch will take only a few minutes but will trigger the most eagerly awaited showdown since Tony Blair swept away 18 years of Conservative rule in 1997 and what promises to be the most closely fought election since John Major defied the polls and Neil Kinnock in 1992.
http://www.timesonline.co.uk/tol/news/politics/article7088375.ece
Personally, I think dissolution is too good for Her Majesty’s House of Crooks and suggest reintroducing the stocks, the pillory, and bringing back being hung drawn and quartered for quite a few. Sadly our false prosperity is coming to its end. Sometime after May 6th, 2010, economic reality is about to intrude into most hapless Brits, downwardly mobile life. Shortly ahead for modern Britain’s serfs, a taste of Icelandic, Irish and Greek style austerity, although if the people’s republic gets returned to power a post Soviet Union style economic collapse seems highly probable to me.
They're changing PM at Buckingham Palace -
Gordon Brown went down with Alice.
"Do you think the Queen knows all about me?"
"Sure to, dear, but it's time for DC,"
Says Alice
With apologies to A.A.Milne.
At the Comex silver depositories Monday, final figures were: Registered 53.77 Moz, Eligible 62.29 Moz, Total 116.06 Moz.
Crooks & Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
Today, the views of disgraced, fallen former economics guru Greenspan, the Bernie Madoff of Federal Reserve serial bubbles built on securities fraud and Wall Street flim-flam. An economist who never saw a bubble he didn’t like, nor ever saw an approaching pin for every bubble. Perpetually gun shy, after the stock market crash of 1987, he threw ever increasing amounts of fiat dollars at every problem that surfaced, until Wall Street’s “finest” packaged up hundreds of billions of “triple-A” rubbish and foist it on a brain dead unsuspecting world, even as they created derivatives instruments that allowed them to bet against their mugs. Run immediately to precious metals, “Bubbles” is now bullish on the US economy. What could possibly go wrong?
Alan Greenspan upbeat on US economy
The former chairman of the US Federal Reserve, has said there is "momentum building up" in the US economy.
By Garry White Published: 9:44PM BST 04 Apr 2010
He added that the odds of the US economy stalling had "fallen very significantly".
"There is a momentum building up which is really just beginning and it's got a way to go," said Mr Greenspan, adding that the country was on the edge of a "significant build-up" in inventories "and that was a self-reinforcing cycle".
His comments, in an interview with ABC news, followed last week's figures that showed US employment growing in March by the largest amount in three years.
The Labour Department said that payrolls over the month increased by 162,000, the third gain in the past five months and the most since March 2007.
Mr Greenspan also said that corporate investment in new equipment was starting to come back "in a fairly substantial way".
http://www.telegraph.co.uk/finance/economics/7554158/Alan-Greenspan-upbeat-on-US-economy.html
"Were we to be directed from Washington when to sow and when to reap, we should soon want bread."
Thomas Jefferson
The monthly Coppock Indicators finished March:
DJIA: +168 UP. NASDAQ: +370 UP. SP500: +196 UP. The great Bull market goes on with the all three continuing higher in positive numbers.
Help the LIR fight Banksterism, the EU, and for sound money.
If you can, help the LIR stay around and make a difference. Please make a donation at the PayPal link on the website or better still become a sponsor for what looks like an exciting 2010. Capitalism not banksterism.
Sunspots – A 22 year colder world? (From 2004?)
Spotless Days April 04 Current Stretch: 0 days
2010 total: 6 days (6%)
2009 total: 260 days (71%)
Since 2004: 776 daysTypical Solar Min: 485 days
http://www.spaceweather.com/
The long minimum seems to have ended.
New Solar Cycle Prediction
http://science.nasa.gov/headlines/y2009/29may_noaaprediction.htm
Is the Sun Missing Its Spots?
http://www.nytimes.com/2009/07/21/science/space/21sunspot.html?8dpc
Are Sunspots Different During This Solar Minimum?
-----But something is unusual about the current sunspot cycle. The current solar minimum has been unusually long, and with more than 670 days without sunspots through June 2009, the number of spotless days has not been equaled since 1933.
----During the period from 1645 to 1715, the Sun entered a period of low activity now known as the Maunder Minimum, when through several 11- year periods the Sun displayed few if any sunspots. Models of the Sun's irradiance suggest that the solar energy input to the Earth decreased during that time and that this change in solar activity could explain the low temperatures recorded in Europe during the Little Ice Age.
----The same data were later published [Penn and Livingston, 2006], and the observations showed that the magnetic field strength in sunspots were decreasing with time, independent of the sunspot cycle. A simple linear extrapolation of those data suggested that sunspots might completely vanish by 2015.These observations caused researchers to wonder whether the characteristics of sunspots are different now than in other solar cycles.http://www.leif.org/EOS/2009EO300001.pdf
Big freeze could signal global warming 'pause'
The Arctic conditions which have brought Britain to a standstill over the past week could be the start of a "pause" in global warming, some scientists believe.
Published: 9:20AM GMT 11 Jan 2010
http://www.telegraph.co.uk/earth/environment/globalwarming/6965342/Big-freeze-could-signal-global-warming-pause.html
Sunspot cycle 24: Together with sunspot cycle 25, the next two global cooling cycles. The new “Dalton Minimum?” Twenty Nine months now with low sunspots numbers, and counting. March was the 29th month of yet another low number of 15.4 http://en.wikipedia.org/wiki/Dalton_Minimum
Smoothed sunspot numbers (SSN). 2007, Oct. 0.9. The end of cycle 23.
Sunspot cycle 24: Nov 1.7. Dec 10.1. Jan 3.4. Feb 2.2. Mar 9.3 April 2.9. May: 2.9. June 3.1. July 0.5. August 0.5. Sep 1.1 Oct. 2.9. Nov. 4.1 Dec 0.8. Jan 1.5. Feb 1.4. Mar 0.7. Apr 1.2. May 2.9. June 2.6. July 3.5. Aug. 0.0. Sep 4.2. Oct 4.6. Nov 4.2. Dec 10.6 Jan 13.1 Feb 18.6 Mar 15.4.
Sunspots. http://solarscience.msfc.nasa.gov/SunspotCycle.shtml
The count. http://sidc.oma.be/products/ri_hemispheric/
Why a New Minimum. http://sesfoundation.org/dalton_minimum.pdf
The “Carrington Event,” September 1, 1859.
http://science.nasa.gov/headlines/y2008/06may_carringtonflare.htm
Current Space Weather.
http://www.swpc.noaa.gov/
What happened to global warming?
http://news.bbc.co.uk/1/hi/sci/tech/8299079.st
This week’s featured links: Silver & Gold Miners + Rare Metals.
With US trillion dollar deficits stretching as far as the eye can see, and voodoo economics the order of the day at the central banks, I think it is now time to begin selectively scaling into precious metals companies that mostly meet the following criteria:
Adequate cash reserves. Good management. Strong in-ground reserves or prospects. NAFTA based, or else located in countries with strong rule of law.
Endeavour Silver Corp. TSX: EDR. http://www.edrsilver.com/s/Home.asp
Semafo TSX: SMF http://www.semafo.com/home_company_intro.php
ATW Gold Corp. TSX.V: ATW. http://www.atwgold.com/
US Silver Corp. TSX.V: USA. http://www.us-silver.com/s/Home.asp
Excellon Resources Inc. TSX: EXN. http://www.excellonresources.com/
First Majestic Silver Corp. TSX: FR http://www.firstmajestic.com/s/Home.asp
New Jersey Mining Company. OTCBB: NJMC
http://www.newjerseymining.com/index.html
Atna Resources Ltd. TSX: ATN. http://www.atna.com/s/Home.asp
Barkerville Gold Mines TSX.V: BGM. Formerly International Wayside Gold Mines Ltd.
http://www.barkervillegold.com/s/Home.asp
Shoreham Resources Ltd. TSX-V: SMH
http://www.shoreham.ca/
ATAC Resources Ltd, TSX.V: ATC. http://www.atacresources.com/s/home.asp
Evolving Gold Corp. TSX.V: EVG http://www.evolvinggold.com/
Lydian International Ltd. TSX: LYD. Note: LYD operates in Armenia, a region carrying higher risk than our usual safer picks in NAFTA lands. http://www.lydianinternational.co.uk/
The story of rare earths and metals is mostly one of China producing and exporting, Japan, America and everyone else importing. Vital to our new technologies, and lifestyle, and critical to hybrid and electric cars, Rare Earth Elements and Heavy Rare Earths, are a strategic choke point held in China’s hands. Lately China has been squeezing that choke point. I think that AVL at Thor Lake Canada, has a property of global importance. A property with the ability to offer NAFTA access to REEs and HREs for the decades ahead. As America and the west move to reduce over dependence on oil from unstable regions, we will see demand for rare metals take off.
Avalon Rare Metals Inc. TSX: AVL. http://www.avalonraremetals.com/
We will be adding more REEs as appropriate.
Warning.
Sadly we are all in unexplored territory. The world has never before suffered a severe recession/depression while operating on fiat currency. As is widely apparent, the central banks haven’t a clue and are making up the rules as the flounder along. They never saw it coming they claim, although it was obvious to many fine writers though not unfortunately in the mainstream media, that a giant financialised derivatives gambling economy would always end badly. There are no experts now, for the simple reason that we have never before faced such a sudden synchronised and deep collapse in the global economies.
The unfortunate fact that we are operating on fraudulent currencies is highly likely to mean it all ends many months from now, in a fiat currency revulsion, but only after the monetary authorities have first tried pouring in endless amounts of newly created money. A derivatives gambling world with an estimated quadrillion dollars of face value has to be unwound and the losses absorbed. In this sort of investing environment, cash, gold and silver and tangible assets are favoured over stocks and intangible assets.
As always if thinking about making an investment, it’s important to do one’s own due diligence. No one has more at risk in an investment than you do yourself. In these difficult economic times, there will likely be several false bottoms before the real one arrives and hindsight allows us to confirm that the bottom is in. Even then, a “V” shaped rebound is highly improbable. A double dip recession seems likely. Beware the false "statistical" government subsidised "recovery." It is a "recovery" bought from a future of fiat currency collapse.
Graeme Irvine
London Irvine Report: www.londonirvinereport.com/
Graeme@londonirvinereport.com
LIR Gold Target by 2019: $3,000.
“When I am asked for a detailed forecast of what will happen in the coming months or years I remember Sam Goldwyn 's advice: "Never prophesy, especially about the future." (Interruption from the floor) Never mind, it is wet outside. I expect that they wanted to come in. You cannot blame them; it is always better where the Tories are.”
Margaret Thatcher. October 1980.
We open for the day readying for trouble in South Africa. South Africa appears to be heading off on the road to Zimbabwe. Bad news for mining companies in South Africa is very good news for competing mining companies in safer more stable countries elsewhere. My guess is that Canada, Australia, and Latin America will gain at South Africa’s expense. My guess is that excellent mining companies like Canada’s SEMAFO (TSX: SMF) operating in west Africa will be prominent among the gainers. Interestingly, SEMAFO is in the early stages of exploring with governments in the region the possibilities for solar power. While it’s too early to say if this “green energy” possibility will lead to a pilot project, it’s another sign of our world on the threshold of great change. Below, the Telegraph covers South Africa on the edge of resource nationalism abyss.
“We must find new lands from which we can easily obtain raw materials and at the same time exploit the cheap slave labor that is available from the natives of the colonies. The colonies would also provide a dumping ground for the surplus goods produced in our factories.”
Cecil Rhodes.
Mining groups fear backlash in South Africa
London-listed mining companies are bracing themselves for a wave of ethnic violence in South Africa as tensions escalate following the murder of notorious far-right politician Eugene Terreblanche.
By Garry White Published: 10:05PM BST 04 Apr 2010
The white supremacist leader was hacked to death at his Transvaal farm on Saturday – the same day that a senior member of the African National Congress (ANC) called for the nationalisation of all South Africa's foreign-owned mines.
Speaking in Zimbabwe on Saturday, Julius Malema, leader of the influential ANC Youth League, said South Africa's mines should be returned to black ownership.
"They have exploited our minerals for a very long time. We want the mines, now it's our turn," Mr Malema said.
Most of the UK-listed miners have significant interests in South Africa, particularly Anglo American, but Rio Tinto, BHP Billiton and Xstrata all have major assets within the country. Anglo American has majority stakes in many of the country's miners, including Anglo Platinum and Kumba Iron Ore. These four mining companies make up more than 10pc of the FTSE 100.
Widespread violence could lead to disrupted mine output, analysts said, potentially causing spikes in some commodity prices.
"This is one of the biggest threats to the South African mining industry today," one senior executive told The Daily Telegraph, although they declined to be named.
According to the South African Department of Minerals and Energy, the country has about 85pc of global reserves of platinum, which is used to make catalytic converters for vehicles.
It also has almost 80pc of the world's reserves of manganese and 73pc of global chrome stocks, which is used in the manufacture of stainless steel.
The country also has significant reserves of gold, zirconium and titanium.
"If South Africa adds to the problems it already has, investment is going to go elsewhere," John Meyer, head of mining at broker Fairfax said.
-----The outspoken Mr Malema, who has praised the farm seizures of Robert Mugabe, is widely blamed for stoking violence against white farmers after singing a controversial apartheid-era song which includes the line "kill the Boer".
He has been calling for nationalisation for the last three months, prompting Susan Shabangu, South Africa's respected mining minister, to say that a state takeover of the industry would not happen "in her lifetime". She said that Mr Malema was merely stretching his "intellectual muscles".
In the face of rising concern among foreign investors, Jacob Zuma, South Africa's president, refuses to rein in Mr Malema. He argues that South Africa is a free country and all citizens and can do and say as they please.
http://www.telegraph.co.uk/finance/newsbysector/industry/7554120/Mining-groups-fear-backlash-in-South-Africa.html
In other news this morning, the IMF is about to recommend the G-20 adopting and implementing a bankster “excess profits tax.” PIIGS will fly first I suspect. The banksters, who’d sell their own granny for the fat she would yield, will move heaven and earth to change any government rash enough to do any such thing, I suspect. Below, the Telegraph covers the IMF’s “pie in the banksters eye” fantasy, to mangle a metaphor.
The bankster Duke of Dunstable had one-way pockets.
He would walk ten miles in the snow to chisel an orphan out of tuppence.
With apologies to P.G. Wodehouse.
IMF targets banks with 'excess profits tax'
The International Monetary Fund is poised to recommend an unprecedented new "excess profits tax" on banks worldwide.
By Edmund Conway, Economics Editor Published: 10:24PM BST 05 Apr 2010
The Fund is expected to suggest the tax – which is effectively on banks' cashflow – as one of the best ways governments can raise significant amounts from banks without drastically distorting the financial system.
The tax will be announced alongside the Obama-style banking levy, which the IMF will also rubber-stamp in its report, to be published at its spring meetings this month.
The IMF was commissioned by the Group of Twenty leading economies last year to investigate new taxes on banks.
Although most attention initially was on so-called Tobin taxes, which levy small charges on banks' financial transactions (a model promoted by campaign groups as the Robin Hood Tax), the Fund is likely to rule them out as a serious prospect. The move is likely to frustrate Gordon Brown, who threw his weight behind the transactions tax in the early stages of the research.
Most had assumed that this would mean the Fund would give its central recommendation to a form of balance sheet levy, which has already been implemented in Sweden, and which has been proposed by the Obama administration.
However, the Fund is also considering giving an equally-important recommendation to a less well-known type of tax which simply levies a charge on bank profits, beyond a certain level.
The advantage of the balance sheet levy is that it should encourage banks not to build excessively large stocks of assets, as Royal Bank of Scotland famously did ahead of the crisis. The benefit of the excess profits tax is that it is thought to be the most efficient way to raise money from banks, and could in time replace regular business taxes as the best way of generating revenue from financial institutions.
-----Peter Spencer, economic adviser to the Ernst & Young Item Club, said: "The problem with an excess profits tax would be that it is very difficult to draw a dividing line between one kind of industry – which does pay the tax – and another that doesn't. Migration and effectively avoidance are the things which would make it very difficult. Also, the last thing you want to do is to deter people from making profits."
Britain toyed with an excess profits tax during the Second World War, although the use of such a system in a specific industry would be unprecedented.
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7557409/IMF-targets-banks-with-excess-profits-tax.html
Far away in a land where taxes and work are optional, most jobs are no-show jobs provided by the government and paid for by Brussels levies on hardworking Germans and Brits, and the sun never stops shining, the locals have started moving their money to the gnomes of Switzerland, home of the mega bank UBS, the Scarlet Pimpernel banksters with a contempt for other countries tax laws. Easy going, slothful but filthy rich Greeks might want to reconsider their choice of safe haven for their tax free, ill-gotten gains. Faced with going to a US guillotine or ratting out their US tax evading clients, the Scarlet Pimpernel in this 21st century edition, has just done a deal to walk away and rat out the American tax cheat aristocracy. I doubt that the Greeks will fare much better, when the German’s get forced into bailing out tax shy Greece.
They seek him here, they seek him there
Those taxmen seek him everywhere
Is he in heaven or is he in hell?
Or is he in a Geneva tax motel?
With apologies to Baroness Orczy. (Charles Dickens surely!)
Greek banks hit by wealthy citizens moving their money offshore
Greek banks are being hit by a wave of redemptions as the country's most wealthy citizens and corporations look to move their money offshore or to international financial institutions perceived as safer homes for their assets.
By Harry Wilson Published: 10:13PM BST 05 Apr 2010
Wealthy Greeks and companies have been clamouring to move their cash deposits to banks such as HSBC or France's Société Générale, which operate large branches in the country. They are among those to have received several billion euros of new money in recent weeks.
HSBC's private banking in the country is understood to have been flooded with business, while the local operations of several other major international banks have already seen large inflows of money. A spokesman for HSBC declined to comment.
Eurozone countries are still at loggerheads on bailing out the southern European nation, with Germany believed to be in conflict with other countries in the single currency over how much interest to charge on the emergency loans package. Germany wants interest rates of 6pc to 6.5pc, with other countries willing to accept 4pc to 4.5pc interest.
More than €3bn (£2.6bn) of deposits held by Greek households and companies left the country in February, while in January about €5bn of deposits were moved out, according to the latest figures available from the Bank of Greece.
Switzerland, the UK and Cyprus have been the largest recipients of the money, with the wealthiest Greeks looking to move their deposits to Swiss banks accounts to escape the more punitive tax measures many fear will be introduced in the wake of the country's economic crisis.
John Raymond, a banks analyst at CreditSights, said that on a visit to Athens last week capital flight was the number one issue worrying most Greek bankers.
"The banks themselves are concerned by it because they can't get funding elsewhere at the moment," he said.
"Greek banks won't be able to increase lending volumes if deposits don't increase, and a continued deterioration in their deposit base will lead them to cut back lending even more, stifling real economic growth."
http://www.telegraph.co.uk/news/worldnews/europe/greece/7557213/Greek-banks-hit-by-wealthy-citizens-moving-their-money-offshore.html
We end for the day with “the man who saved the world” twice, heading over to Buckingham Palace to ask the Queen to dissolve “the Crooked Parliament” of 2005-2010, to be renamed Brown Palace in the Old Labour plans for a socialist people’s republic, in the unlikely event that Stalin MacBroon and Bob Crow, leader of the Rail, Maritime and Transport union, get returned to power in the coming general election in Britain. Stay long precious metals, but outside of UK jurisdiction.
They're changing PM at Buckingham Palace -
Gordon Brown went down with Alice.
A face looked out, but it wasn't the Queen’s.
"She's much too busy packing things,"
Says Alice.
With apologies to A.A.Milne.
April 6, 2010
Fiercely contested election campaign begins today
Gordon Brown will travel the mile from Downing Street to Buckingham Palace today and launch the most fiercely contested election campaign for a generation.
He will ask the Queen to dissolve Parliament next Monday and will name May 6 as the day voters decide his fate.
Within minutes the frenzy of electoral combat will begin. Mr Brown will make a symbolic trip to the South East, showing his determination to hold on to new Labour gains of 1997. David Cameron will head in the opposite direction, taking the fight to Labour in the Midlands and the North.
The formalities between the Prime Minister and the monarch will take only a few minutes but will trigger the most eagerly awaited showdown since Tony Blair swept away 18 years of Conservative rule in 1997 and what promises to be the most closely fought election since John Major defied the polls and Neil Kinnock in 1992.
http://www.timesonline.co.uk/tol/news/politics/article7088375.ece
Personally, I think dissolution is too good for Her Majesty’s House of Crooks and suggest reintroducing the stocks, the pillory, and bringing back being hung drawn and quartered for quite a few. Sadly our false prosperity is coming to its end. Sometime after May 6th, 2010, economic reality is about to intrude into most hapless Brits, downwardly mobile life. Shortly ahead for modern Britain’s serfs, a taste of Icelandic, Irish and Greek style austerity, although if the people’s republic gets returned to power a post Soviet Union style economic collapse seems highly probable to me.
They're changing PM at Buckingham Palace -
Gordon Brown went down with Alice.
"Do you think the Queen knows all about me?"
"Sure to, dear, but it's time for DC,"
Says Alice
With apologies to A.A.Milne.
At the Comex silver depositories Monday, final figures were: Registered 53.77 Moz, Eligible 62.29 Moz, Total 116.06 Moz.
Crooks & Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
Today, the views of disgraced, fallen former economics guru Greenspan, the Bernie Madoff of Federal Reserve serial bubbles built on securities fraud and Wall Street flim-flam. An economist who never saw a bubble he didn’t like, nor ever saw an approaching pin for every bubble. Perpetually gun shy, after the stock market crash of 1987, he threw ever increasing amounts of fiat dollars at every problem that surfaced, until Wall Street’s “finest” packaged up hundreds of billions of “triple-A” rubbish and foist it on a brain dead unsuspecting world, even as they created derivatives instruments that allowed them to bet against their mugs. Run immediately to precious metals, “Bubbles” is now bullish on the US economy. What could possibly go wrong?
Alan Greenspan upbeat on US economy
The former chairman of the US Federal Reserve, has said there is "momentum building up" in the US economy.
By Garry White Published: 9:44PM BST 04 Apr 2010
He added that the odds of the US economy stalling had "fallen very significantly".
"There is a momentum building up which is really just beginning and it's got a way to go," said Mr Greenspan, adding that the country was on the edge of a "significant build-up" in inventories "and that was a self-reinforcing cycle".
His comments, in an interview with ABC news, followed last week's figures that showed US employment growing in March by the largest amount in three years.
The Labour Department said that payrolls over the month increased by 162,000, the third gain in the past five months and the most since March 2007.
Mr Greenspan also said that corporate investment in new equipment was starting to come back "in a fairly substantial way".
http://www.telegraph.co.uk/finance/economics/7554158/Alan-Greenspan-upbeat-on-US-economy.html
"Were we to be directed from Washington when to sow and when to reap, we should soon want bread."
Thomas Jefferson
The monthly Coppock Indicators finished March:
DJIA: +168 UP. NASDAQ: +370 UP. SP500: +196 UP. The great Bull market goes on with the all three continuing higher in positive numbers.
Help the LIR fight Banksterism, the EU, and for sound money.
If you can, help the LIR stay around and make a difference. Please make a donation at the PayPal link on the website or better still become a sponsor for what looks like an exciting 2010. Capitalism not banksterism.
Sunspots – A 22 year colder world? (From 2004?)
Spotless Days April 04 Current Stretch: 0 days
2010 total: 6 days (6%)
2009 total: 260 days (71%)
Since 2004: 776 daysTypical Solar Min: 485 days
http://www.spaceweather.com/
The long minimum seems to have ended.
New Solar Cycle Prediction
http://science.nasa.gov/headlines/y2009/29may_noaaprediction.htm
Is the Sun Missing Its Spots?
http://www.nytimes.com/2009/07/21/science/space/21sunspot.html?8dpc
Are Sunspots Different During This Solar Minimum?
-----But something is unusual about the current sunspot cycle. The current solar minimum has been unusually long, and with more than 670 days without sunspots through June 2009, the number of spotless days has not been equaled since 1933.
----During the period from 1645 to 1715, the Sun entered a period of low activity now known as the Maunder Minimum, when through several 11- year periods the Sun displayed few if any sunspots. Models of the Sun's irradiance suggest that the solar energy input to the Earth decreased during that time and that this change in solar activity could explain the low temperatures recorded in Europe during the Little Ice Age.
----The same data were later published [Penn and Livingston, 2006], and the observations showed that the magnetic field strength in sunspots were decreasing with time, independent of the sunspot cycle. A simple linear extrapolation of those data suggested that sunspots might completely vanish by 2015.These observations caused researchers to wonder whether the characteristics of sunspots are different now than in other solar cycles.http://www.leif.org/EOS/2009EO300001.pdf
Big freeze could signal global warming 'pause'
The Arctic conditions which have brought Britain to a standstill over the past week could be the start of a "pause" in global warming, some scientists believe.
Published: 9:20AM GMT 11 Jan 2010
http://www.telegraph.co.uk/earth/environment/globalwarming/6965342/Big-freeze-could-signal-global-warming-pause.html
Sunspot cycle 24: Together with sunspot cycle 25, the next two global cooling cycles. The new “Dalton Minimum?” Twenty Nine months now with low sunspots numbers, and counting. March was the 29th month of yet another low number of 15.4 http://en.wikipedia.org/wiki/Dalton_Minimum
Smoothed sunspot numbers (SSN). 2007, Oct. 0.9. The end of cycle 23.
Sunspot cycle 24: Nov 1.7. Dec 10.1. Jan 3.4. Feb 2.2. Mar 9.3 April 2.9. May: 2.9. June 3.1. July 0.5. August 0.5. Sep 1.1 Oct. 2.9. Nov. 4.1 Dec 0.8. Jan 1.5. Feb 1.4. Mar 0.7. Apr 1.2. May 2.9. June 2.6. July 3.5. Aug. 0.0. Sep 4.2. Oct 4.6. Nov 4.2. Dec 10.6 Jan 13.1 Feb 18.6 Mar 15.4.
Sunspots. http://solarscience.msfc.nasa.gov/SunspotCycle.shtml
The count. http://sidc.oma.be/products/ri_hemispheric/
Why a New Minimum. http://sesfoundation.org/dalton_minimum.pdf
The “Carrington Event,” September 1, 1859.
http://science.nasa.gov/headlines/y2008/06may_carringtonflare.htm
Current Space Weather.
http://www.swpc.noaa.gov/
What happened to global warming?
http://news.bbc.co.uk/1/hi/sci/tech/8299079.st
This week’s featured links: Silver & Gold Miners + Rare Metals.
With US trillion dollar deficits stretching as far as the eye can see, and voodoo economics the order of the day at the central banks, I think it is now time to begin selectively scaling into precious metals companies that mostly meet the following criteria:
Adequate cash reserves. Good management. Strong in-ground reserves or prospects. NAFTA based, or else located in countries with strong rule of law.
Endeavour Silver Corp. TSX: EDR. http://www.edrsilver.com/s/Home.asp
Semafo TSX: SMF http://www.semafo.com/home_company_intro.php
ATW Gold Corp. TSX.V: ATW. http://www.atwgold.com/
US Silver Corp. TSX.V: USA. http://www.us-silver.com/s/Home.asp
Excellon Resources Inc. TSX: EXN. http://www.excellonresources.com/
First Majestic Silver Corp. TSX: FR http://www.firstmajestic.com/s/Home.asp
New Jersey Mining Company. OTCBB: NJMC
http://www.newjerseymining.com/index.html
Atna Resources Ltd. TSX: ATN. http://www.atna.com/s/Home.asp
Barkerville Gold Mines TSX.V: BGM. Formerly International Wayside Gold Mines Ltd.
http://www.barkervillegold.com/s/Home.asp
Shoreham Resources Ltd. TSX-V: SMH
http://www.shoreham.ca/
ATAC Resources Ltd, TSX.V: ATC. http://www.atacresources.com/s/home.asp
Evolving Gold Corp. TSX.V: EVG http://www.evolvinggold.com/
Lydian International Ltd. TSX: LYD. Note: LYD operates in Armenia, a region carrying higher risk than our usual safer picks in NAFTA lands. http://www.lydianinternational.co.uk/
The story of rare earths and metals is mostly one of China producing and exporting, Japan, America and everyone else importing. Vital to our new technologies, and lifestyle, and critical to hybrid and electric cars, Rare Earth Elements and Heavy Rare Earths, are a strategic choke point held in China’s hands. Lately China has been squeezing that choke point. I think that AVL at Thor Lake Canada, has a property of global importance. A property with the ability to offer NAFTA access to REEs and HREs for the decades ahead. As America and the west move to reduce over dependence on oil from unstable regions, we will see demand for rare metals take off.
Avalon Rare Metals Inc. TSX: AVL. http://www.avalonraremetals.com/
We will be adding more REEs as appropriate.
Warning.
Sadly we are all in unexplored territory. The world has never before suffered a severe recession/depression while operating on fiat currency. As is widely apparent, the central banks haven’t a clue and are making up the rules as the flounder along. They never saw it coming they claim, although it was obvious to many fine writers though not unfortunately in the mainstream media, that a giant financialised derivatives gambling economy would always end badly. There are no experts now, for the simple reason that we have never before faced such a sudden synchronised and deep collapse in the global economies.
The unfortunate fact that we are operating on fraudulent currencies is highly likely to mean it all ends many months from now, in a fiat currency revulsion, but only after the monetary authorities have first tried pouring in endless amounts of newly created money. A derivatives gambling world with an estimated quadrillion dollars of face value has to be unwound and the losses absorbed. In this sort of investing environment, cash, gold and silver and tangible assets are favoured over stocks and intangible assets.
As always if thinking about making an investment, it’s important to do one’s own due diligence. No one has more at risk in an investment than you do yourself. In these difficult economic times, there will likely be several false bottoms before the real one arrives and hindsight allows us to confirm that the bottom is in. Even then, a “V” shaped rebound is highly improbable. A double dip recession seems likely. Beware the false "statistical" government subsidised "recovery." It is a "recovery" bought from a future of fiat currency collapse.
Graeme Irvine
London Irvine Report: www.londonirvinereport.com/
Graeme@londonirvinereport.com
Monday, 5 April 2010
The End of the Constitutional Republic
Baltic Dry Index. 2991 -07
LIR Gold Target by 2019: $3,000.
“Republics decline into democracies and democracies degenerate into despotisms.”
Aristotle. 384-322 BC.
We open for the new week with two of the most troubling articles of the fraud driven, derivatives gambling, global financial calamity so far. The G-1, the City of Light on the hill to the world, has left the constitutional republic behind, and turned itself into a halfway house to criminal dictatorship and tyranny. The tragedy of ancient Greek democracy seems to be repeating in the early decades of the 21st century. Though it is by no means certain that the forces of law and order and constitutional republicanism won’t at some stage reassert control, for now all the signs in America suggest just the opposite. But first this, the tax challenged US Treasury Secretary Timothy Geithner has either just demonstrated great diplomatic tact and aplomb by delaying a report branding China a currency manipulator, infuriating America’s largest creditor in the process, or has just kow-towed to China’s recent warning’s from China’s leadership, not to do it or else. In the tottering bankrupt, monetizing west it will be seen as the former. In the rising countries that make up the “BRIC,” Brazil, Russia, India and China, it will be seen as another sign that Pax-Americana is over. The truth is somewhere in between, but the days of a sole fiat dollar reserve standard are numbered.
“This and no other is the root from which a tyrant springs; when he first appears he is a protector.”
Plato. 428-348 BC.
Geithner Delays Currency Report, Urges Flexible Yuan for China
April 4 (Bloomberg) -- U.S. Treasury Secretary Timothy F. Geithner delayed a scheduled April 15 report to Congress on exchange-rate policies, sidestepping a decision on whether to accuse China of manipulating the value of the yuan.
Geithner in a statement yesterday urged China to move toward a more flexible currency and said a series of meetings over the next three months will be “critical” to bringing policy changes that lead to a stronger, “more balanced” global economy. The delay comes as Chinese President Hu Jintao is scheduled to visit Washington for a nuclear summit April 12-13.
The Treasury chief faces demands from Congress to label China a currency manipulator for keeping the value of the yuan little changed from about 6.83 to the dollar for almost two years. Geithner is instead betting that China will take steps on its own in the next several months to strengthen its currency, analysts said.
----Geithner’s statement said countries such as China “with inflexible exchange rates” can promote global growth by “combining policy efforts to strengthen domestic demand with greater exchange-rate flexibility.”
“A move by China to a more market-oriented exchange rate will make an essential contribution to global rebalancing,” he said.
Lawmakers Critical
Lawmakers from both parties said Geithner is wrong to expect that negotiations will prompt such a move from China’s leaders. With the U.S. unemployment rate hovering near a 26-year high, some lawmakers say China’s policies give its exporters an unfair advantage over their U.S. competitors.
“We are disappointed, but not surprised, by the administration’s decision,” Senator Charles E. Schumer, a New York Democrat, said in an e-mailed statement yesterday. “After five years of stonewalling, punctuated by occasional, but halting action by the Chinese, we have lost faith in bilateral negotiations on this issue.”
Legislation
Schumer, along with four other senators including South Carolina Republican Lindsey Graham, last month introduced legislation to require the Treasury to determine if a nation had a currency misaligned with the dollar and make it easier to respond by imposing import duties.
-----The latest delay “is probably the politically smart thing to do,” with Hu planning to be in Washington for talks with President Barack Obama, said Charles Freeman, a China expert at the Center for Strategic and International Studies in Washington.
“I’m not sure Treasury really knows what it wants to do yet,” said Freeman. “It’s testing the political waters on Capitol Hill.”
Geithner said April 2 that Hu’s visit, along with a meeting of Group of 20 finance ministers and central bank governors this month and a U.S.-China Strategic and Economic Dialogue scheduled for May, will offer “the best avenue for addressing U.S. interests at this time.”
http://www.bloomberg.com/apps/news?pid=20601087&sid=azQRzn_a9eP8
Now back to the death of the constitutional US Republic. An ends justifies the means rapid transition into a state/bankster controlled, semi constitutional, faux democracy has occurred. One where the masses are not to be trusted, and the operatives of state are unaccountable to serious rule of law at their option. This has big implications for America’s moral authority to lead in the world and in the west, and big implications for most of the west’s grand alliances. It is one thing when a small irrelevant state like Greece descends into state criminality. When the world’s only, if bankrupt, superpower does it, the whole global world order goes into unpredictable transition. It has big implications for investment decisions also. Such a state is to be feared, and is parasitic to wealth creation and global resources. It is no place for the rest of the world’s savings to be invested. Wealth destruction and ruin lie in all systems not based of capitalism and reliable rule of law, and equality under that law. Without that, there simply is no contract between those ruled and those in the position of exercising power. One’s wealth become subject to appropriation by caprice, vagary, avarice, and dictat of the rulers and their cronies. Up first, Karl Denninger covers last week’s developments fed out on “a good day to bury bad news,” to use the Tony Blair 2001 method of Nu Labour government.
“When the tyrant has disposed of foreign enemies by conquest or treaty and there is nothing to fear from them, then he is always stirring up some war or other, in order that the people may require a leader.”
Plato. 428-348 BC.
The Fed Admits To Breaking The Law
April 1 (Bloomberg) -- After months of litigation and political scrutiny, the Federal Reserve yesterday ended a policy of secrecy over its Bear Stearns Cos. bailout.
In a 4:30 p.m. announcement in a week of congressional recess and religious holidays, the central bank released details of securities bought to aid Bear Stearns’s takeover by JPMorgan Chase & Co. Bloomberg News sued the Fed for that information.
The problem is this: The Fed is not authorized to BUY anything other than those securities that have the full faith and credit of The United States.
In addition Ben Bernanke has repeatedly claimed that these deals would not cost anyone money. But the current value looks differently:
Assets in Maiden Lane II totaled $34.8 billion, according to the Fed, which set their current market value in its weekly balance sheet at $15.3 billion. That means Maiden Lane II assets are worth 44 cents on the dollar, or 44 percent of their face value, according to the Fed.
Maiden Lane III, which has $56 billion of assets at face value, is worth $22.1 billion, or 39 cents on the dollar, according to the Fed’s weekly balance sheet. A similar calculation for the Bear Stearns portfolio couldn’t be made because of outstanding derivatives trades.
In other words, they have lost more than half of their value.
This was and remains a blatantly unlawful activity.
The Fed has effectively usurped Article 1 Section 7 of The Constituion which reads in part:
All bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills.
The Fed effectively appropriated taxpayer funds without authorization of Congress. At the time these facilities were put in place neither TARP or any other Congressional authorization existed for them to do so, and to date no bill has been put through Congress authorizing the expenditure of taxpayer funds, either through putting them at risk or via outright expense, for this purpose.
Nor does it stop with a "mere" Constitutional violation - The Federal Reserve Act's Sections 13 and 14 do not permit Fed asset purchases except, once again, for items carrying "full faith and credit" guarantees. Credit-default swaps and trash mortgages most certainly do not meet these qualifications.
I know I've harped on this for more than two years, but here we have a raw admission of exactly what was done - and there is simply no way to construe any of it in a light that conforms with either The Constitution or black-letter statutory law.
What's worse is that Tim Geithner, head of the NY Fed at the time, was very much involved in this - that is, he in effect personally, along with Ben Bernanke, usurped the power of the United States House.
The Fed has spent two years trying to hide this from the public and Congress. It has fought off both Congressional demands for disclosure and multiple FOIA lawsuits, the latter of which has resulted in a series of adverse rulings (and, it appears, was ultimately going to force disclosure anyway.)
These actions are unacceptable but promising "never to do that again" is insufficient. In a Representative Republic where the rule of law is supposed to be paramount - that is, where we do not crown Kings and relegate everyone else to the status of knaves, unlawful actions such as this demand that strong and unmistakable sanction also be applied to all wrongdoers in addition to protection against future abuse.
In this case this means that both Geithner and Bernanke must go - for starters.
Amending The Federal Reserve Act of 1913 (as Chris Dodd has proposed to prevent future lending bailouts) is not sufficient in that The Fed did not lend in this case, it purchased, and by buying what we now know were trash loans it violated the black letter of existing law.
There is only one effective remedy for an institution that has proved that it will not abide the law: it must be stripped of all authority that has been in the past and can be in the future abused.
This means that The Fed, if we are to keep it at all, must be relegated to a body that only practices and provides monetary policy - nothing more or less - and that all monetary operations must be performed openly, transparently, and within those constraints.
We cannot have a republic where an unelected body is left free to violate The Constitution with wild abandon and those acts are then allowed to stand.
One final thought: If the individuals responsible for this blatant black-letter violation of the law do not face meaningful sanction for these acts, and neither does The Fed as an institution, can you fine folks over at The Executive, Judiciary and Legislative branches of our government please explain to us ordinary Americans why we should obey any of the laws of this land when you will not enforce the laws that already exist?
http://market-ticker.denninger.net/archives/2147-The-Fed-Admits-To-Breaking-The-Law.html
Below, President Ronald Reagan’s Assistant Secretary of the Treasury, speaks out one last time against how the last two decades have altered America, hopefully though not forever. Stay long precious metals, preferably outside of US and UK jurisdiction. Our world is in transition in a way that somewhat resembles the tumultuous change in China 1949. Lest anyone forget, the rise of a communist dictatorship in China did nothing good for the masses of Chinese people.
“Tyrants have always some slight shade of virtue; they support the laws before destroying them”
Voltaire.
Truth Has Fallen and Taken Liberty With It
By PAUL CRAIG ROBERTS March 24, 2010
There was a time when the pen was mightier than the sword. That was a time when people believed in truth and regarded truth as an independent power and not as an auxiliary for government, class, race, ideological, personal, or financial interest.
Today Americans are ruled by propaganda. Americans have little regard for truth, little access to it, and little ability to recognize it.
Truth is an unwelcome entity. It is disturbing. It is off limits. Those who speak it run the risk of being branded “anti-American,” “anti-semite” or “conspiracy theorist.”
Truth is an inconvenience for government and for the interest groups whose campaign contributions control government.
Truth is an inconvenience for prosecutors who want convictions, not the discovery of innocence or guilt.
Truth is inconvenient for ideologues.
Today many whose goal once was the discovery of truth are now paid handsomely to hide it. “Free market economists” are paid to sell offshoring to the American people. High-productivity, high value-added American jobs are denigrated as dirty, old industrial jobs. Relicts from long ago, we are best shed of them. Their place has been taken by “the New Economy,” a mythical economy that allegedly consists of high-tech white collar jobs in which Americans innovate and finance activities that occur offshore. All Americans need in order to participate in this “new economy” are finance degrees from Ivy League universities, and then they will work on Wall Street at million dollar jobs.
Economists who were once respectable took money to contribute to this myth of “the New Economy.”
And not only economists sell their souls for filthy lucre. Recently we have had reports of medical doctors who, for money, have published in peer-reviewed journals concocted “studies” that hype this or that new medicine produced by pharmaceutical companies that paid for the “studies.”
The Council of Europe is investigating the drug companies’ role in hyping a false swine flu pandemic in order to gain billions of dollars in sales of the vaccine.
The media helped the US military hype its recent Marja offensive in Afghanistan, describing Marja as a city of 80,000 under Taliban control. It turns out that Marja is not urban but a collection of village farms.
And there is the global warming scandal, in which NGOs. the UN, and the nuclear industry colluded in concocting a doomsday scenario in order to create profit in pollution.
Wherever one looks, truth has fallen to money.
Wherever money is insufficient to bury the truth, ignorance, propaganda, and short memories finish the job.
I remember when, following CIA director William Colby’s testimony before the Church Committee in the mid-1970s, presidents Gerald Ford and Ronald Reagan issued executive orders preventing the CIA and U.S. black-op groups from assassinating foreign leaders. In 2010 the US Congress was told by Dennis Blair, head of national intelligence, that the US now assassinates its own citizens in addition to foreign leaders.
When Blair told the House Intelligence Committee that US citizens no longer needed to be arrested, charged, tried, and convicted of a capital crime, just murdered on suspicion alone of being a “threat,” he wasn’t impeached. No investigation pursued. Nothing happened. There was no Church Committee. In the mid-1970s the CIA got into trouble for plots to kill Castro. Today it is American citizens who are on the hit list. Whatever objections there might be don’t carry any weight. No one in government is in any trouble over the assassination of U.S. citizens by the U.S. government.
As an economist, I am astonished that the American economics profession has no awareness whatsoever that the U.S. economy has been destroyed by the offshoring of U.S. GDP to overseas countries. U.S. corporations, in pursuit of absolute advantage or lowest labor costs and maximum CEO “performance bonuses,” have moved the production of goods and services marketed to Americans to China, India, and elsewhere abroad. When I read economists describe offshoring as free trade based on comparative advantage, I realize that there is no intelligence or integrity in the American economics profession.
Intelligence and integrity have been purchased by money. The transnational or global U.S. corporations pay multi-million dollar compensation packages to top managers, who achieve these “performance awards” by replacing U.S. labor with foreign labor. While Washington worries about “the Muslim threat,” Wall Street, U.S. corporations and “free market” shills destroy the U.S. economy and the prospects of tens of millions of Americans.
-------Americans have bought into the government’s claim that security requires the suspension of civil liberties and accountable government. Astonishingly, Americans, or most of them, believe that civil liberties, such as habeas corpus and due process, protect “terrorists,” and not themselves. Many also believe that the Constitution is a tired old document that prevents government from exercising the kind of police state powers necessary to keep Americans safe and free.
Most Americans are unlikely to hear from anyone who would tell them any different.
I was associate editor and columnist for the Wall Street Journal. I was Business Week’s first outside columnist, a position I held for 15 years. I was columnist for a decade for Scripps Howard News Service, carried in 300 newspapers. I was a columnist for the Washington Times and for newspapers in France and Italy and for a magazine in Germany. I was a contributor to the New York Times and a regular feature in the Los Angeles Times. Today I cannot publish in, or appear on, the American “mainstream media.”
For the last six years I have been banned from the “mainstream media.” My last column in the New York Times appeared in January, 2004, coauthored with Democratic U.S. Senator Charles Schumer representing New York. We addressed the offshoring of U.S. jobs. Our op-ed article produced a conference at the Brookings Institution in Washington, D.C. and live coverage by C-Span. A debate was launched. No such thing could happen today.
For years I was a mainstay at the Washington Times, producing credibility for the Moony newspaper as a Business Week columnist, former Wall Street Journal editor, and former Assistant Secretary of the U.S. Treasury. But when I began criticizing Bush’s wars of aggression, the order came down to Mary Lou Forbes to cancel my column.
The American corporate media does not serve the truth. It serves the government and the interest groups that empower the government.
-----These trillion dollar wars have created financing problems for Washington’s deficits and threaten the U.S. dollar’s role as world reserve currency. The wars and the pressure that the budget deficits put on the dollar’s value have put Social Security and Medicare on the chopping block. Former Goldman Sachs chairman and U.S. Treasury Secretary Hank Paulson is after these protections for the elderly. Fed chairman Bernanke is also after them. The Republicans are after them as well. These protections are called “entitlements” as if they are some sort of welfare that people have not paid for in payroll taxes all their working lives.
With over 21 per cent unemployment as measured by the methodology of 1980, with American jobs, GDP, and technology having been given to China and India, with war being Washington’s greatest commitment, with the dollar over-burdened with debt, with civil liberty sacrificed to the “war on terror,” the liberty and prosperity of the American people have been thrown into the trash bin of history.
The militarism of the U.S. and Israeli states, and Wall Street and corporate greed, will now run their course. As the pen is censored and its might extinguished, I am signing off.
Paul Craig Roberts was an editor of the Wall Street Journal and an Assistant Secretary of the U.S. Treasury. His latest book, HOW THE ECONOMY WAS LOST, has just been published by CounterPunch/AK Press. He can be reached at: PaulCraigRoberts@yahoo.com
http://www.counterpunch.org/roberts03242010.html
While the USA, the UK and the old European powers were never faultless democracies with perfect rule of law for all, and in the UK at least, under Blair and Brown we have traduced long cherished and hard won personal freedoms from the Crown, what we have now approaches more 18th century style capitalism, rather than the late 19th century – 20th century capitalism in which we prospered. I doubt many will prosper under state assisted, crony banksterism. The very conditions that drove much the European population to flee poverty in Europe for a better life in the new world. While America is hardly likely to go off the rails murderous Bolshevik communist Russia style, nor Germany or Italy European fascist style, reversing an elitist power grab in a continent sized virtual empire, historically has never been fast.
In global warming news, don’t tell the scoundrels at the University of East Anglia’s dodgy “man-made global warming from CO2,” Climate Research Unit, but south Florida just had coldest start to a year on record. Wrong sort of CO2 in North America, I presume.
“The foundation of every state is the education of its youth.”
Diogenes. 412-323 BC.
Forecasters: S. Florida Winter Among Coldest Ever
Apr 2, 2010 11:00 am US/Eastern
Record Low Average Temperatures Set For Miami Beach, West Palm Beach, Naples
Cooler Than Normal Temps, Higher Rainfall Expected In April
MIAMI (CBS4) ― Unless you spent this winter somewhere else, you know it was chilly, at least by South Florida standards. Now, with the data in, the National Weather Service has made it official. The first 3 months of the year were the coldest ever reported in Miami Beach, Naples, and West Palm Beach, and was among the coldest winters ever for Ft. Lauderdale and Miami.That information was included in an analysis of winter weather patterns conducted by the National Weather Service weather forecast office in Miami.Forecasters sat March set record cold readings for Miami Beach, which was 5.8 degrees colder than normal, on average, and for Naples, where the average temperature was almost a degree colder than the previous record.
Forecasters say, overall, there were only a handful of days where temperatures were above normal in South Florida.Miami temperatures averaged almost 5 degrees below normal, making the January-March period the 9th coldest ever, while Ft. Lauderdale had it's 4th coldest period ever.While the cold weather of winter appears to be over, that doesn't mean South Florida won't continue to see cooler-than-normal temperatures, according to the National Weather Service.Their outlook claims cooler than normal coastal water temperatures in Florida will combine with the continued "el Nino" weather pattern to likely keep April temperatures below the norm.
The May forecast sees temperatures closer to normal, but that comes with the likelihood rainfall will be greater than normal.All of South Florida also saw an increase in rainfall when compared to previous years, but West Palm Beach, with almost 11 inches of rainfall in March, saw it's 5th wettest march ever. Miami Beach, with just over 4 inches of rain in March, saw it's 9th wettest March ever.
http://cbs4.com/local/RECORD.LOW.TEMPERATURE.2.1607771.html#addComments
“Our government has kept us in a perpetual state of fear. Kept us in a continuous stampede of patriotic fervor-with the cry of grave national emergency. Always there has been some terrible evil to gobble us up if we did not blindly rally behind it by furnishing the exorbitant funds demanded. Yet, in retrospect, these disasters seem never to have happened; seem never to have been quite real."
General Douglas MacArthur. 1957.
At the Comex silver depositories Thursday, final figures were: Registered 53.78 Moz, Eligible 62.06 Moz, Total 115.84 Moz.
+++++
Crooks & Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
Up first this week, time to pull the plug on tax and work shy Greece, says one of the world’s leading experts on sovereign default. “Mr. Papandreou, tear down this wall of financial deceit.”
“The present will not long endure.”
Pindar. 518 -446 BC.
The IMF should impose default on Greece to end the charade
By Ambrose Evans-Pritchard Last updated: April 2nd, 2010
I just had lunch with Carmen Reinhart, author of `This Time is Different: Eight Centuries of Financial Folly” and a world authority on sovereign defaults.
Suitably, she was wearing a medallion of a Spanish silver coin dating from 1580, celebrating Philip II’s third default in eighteen years.
----Professor Reinhart said Greece cannot hope to escape from its debt trap under the current EU austerity plan. The cure of devaluation is blocked by EMU membership. The restrictive monetary policy of the European Central Bank — a contraction of both M3 money and lending to firms, record low core inflation — must inevitably unleash deflationary forces in Club Med states already trapped in credit busts.
A country can in theory deflate its way back to competitiveness by an `internal devaluation’, ie relative wage cuts, in this case by 20pc to 25pc.
Benito Mussolini cut wages by 20pc or so in 1928 when Italy returned to Gold with his Lira Forte policy, but he had Fascist controls on the unions, and Camicie Nere to assist. Italy was not in any case facing the aftermath of a property boom.
It may not be possible for a country to execute such a policy when it already has a public debt above 100pc of GDP, or in Greece’s case nearing 130pc by next year. Debt dynamics take over. The policy leads to a self-feeding spiral in compound interest. This will become evident very soon if — as some economists predict — Greece’s economy contracts by 4pc to 5pc this year.
Ireland is experimenting with this cure. We are seeing the consequences. Nominal GDP has fallen 18.7pc since the top of the boom, according to Barclays Capital.
Real GDP has fallen by less, 12.6pc. The rest is the effect of deflation. But what matters most for debt is nominal GDP. The same debt load has to be financed from a nominal economy that has shrunk by almost a fifth. That is why deflation can be so deadly, as it was from 1930-1933.
-----Greece is another story. It did not invest its EU and EMU windfalls in a well-educated workforce and high-tech enterprise. It spent the money on public payrolls – and submarines — and cut the retirement age as low as 54 for some. We will find out whether it has now gone beyond the point of no return.
Professor Reinhart said Europe will have to bite the bullet and accept `debt-restructuring’ or grapple with unending disaster. Since Germany obviously will not agree to provide the massive long-term finance at cheap rates needed to nurse Greece through the crisis – let alone direct subsidies – there is no alternative: lenders must agree to stretch maturities on Greek debt, and accept an interest rate haircut. “I don’t think the markets have yet understood this,” she said with dry understatement.
She said the model is the Uruguay default in 2003, conducted under the auspices of the IMF when she was working at the Fund. “Everybody got together in a civilized way, and it was very successful,” she said.
The average haircut was 13pc. Maturities were shuffled. Uruguay was praised all round.
Greece is a tougher nut to crack. French banks with €80bn and German banks with €40bn (and British banks too) that bought so much Greek debt at a few basis points over German Bunds in 2006 and 2007 will have to accept a bigger discount to atone for their epic error, perhaps 25pc — though Prof Reinhart did not put a figure on it.
----A Greek default would be twice the size of the two largest defaults in history put together — Argentina and Russia — at least in nominal terms, nearing €300bn. The “demonstration effect” in a long string of countries both inside and beyond EMU might be chilling.
----But is anybody in a position of power in Europe yet willing to contemplate such a solution for Greece? Is France? or Germany? or the European Commission? Or is the ruling machinery of EMU so twisted in ideological knots, and prey to conflicting national agendas, that nothing can be done beyond staging empty summits in Brussels that gain less and less market traction each time? This last deal has been tested within days. Greek spreads are through the roof again. Tuesday’s €1bn snap issue of bonds was horrendous.
---On a parting note, Professor Reinhart says the only budget deficit that matters in a crisis is the “cash deficit”, and this reached 16pc of GDP in Greece last year — not the 12.7pc officially registered under “accrual” accounting.
As countries near default, they typically find all kinds of way to disguise their troubles, by shifting debts between government agencies and delaying payments.
“In the end, everything comes out of the woodwork. You realize that it is even worse than you thought,” she said.
http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100004699/the-imf-should-impose-default-on-greece-to-end-the-charade/
“A democracy is nothing more than mob rule, where fifty-one percent of the people may take away the rights of the other forty-nine.”
Thomas Jefferson (1743 - 1826)
The monthly Coppock Indicators finished March:
DJIA: +168 UP. NASDAQ: +370 UP. SP500: +196 UP. The great Bull market goes on with the all three continuing higher in positive numbers.
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Help the LIR fight Banksterism, the EU, and for sound money.
If you can, help the LIR stay around and make a difference. Please make a donation at the PayPal link on the website or better still become a sponsor for what looks like an exciting 2010. Capitalism not banksterism.
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Sunspots – A 22 year colder world? (From 2004?)
Spotless Days April 04 Current Stretch: 0 days
2010 total: 6 days (7%)2009 total: 260 days (71%)Since 2004: 776 daysTypical Solar Min: 485 days
http://www.spaceweather.com/
The long minimum seems to have ended.
New Solar Cycle Prediction
http://science.nasa.gov/headlines/y2009/29may_noaaprediction.htm
Is the Sun Missing Its Spots?
http://www.nytimes.com/2009/07/21/science/space/21sunspot.html?8dpc
Are Sunspots Different During This Solar Minimum?
-----But something is unusual about the current sunspot cycle. The current solar minimum has been unusually long, and with more than 670 days without sunspots through June 2009, the number of spotless days has not been equaled since 1933.
----During the period from 1645 to 1715, the Sun entered a period of low activity now known as the Maunder Minimum, when through several 11- year periods the Sun displayed few if any sunspots. Models of the Sun's irradiance suggest that the solar energy input to the Earth decreased during that time and that this change in solar activity could explain the low temperatures recorded in Europe during the Little Ice Age.
----The same data were later published [Penn and Livingston, 2006], and the observations showed that the magnetic field strength in sunspots were decreasing with time, independent of the sunspot cycle. A simple linear extrapolation of those data suggested that sunspots might completely vanish by 2015.These observations caused researchers to wonder whether the characteristics of sunspots are different now than in other solar cycles.http://www.leif.org/EOS/2009EO300001.pdf
Big freeze could signal global warming 'pause'
The Arctic conditions which have brought Britain to a standstill over the past week could be the start of a "pause" in global warming, some scientists believe.
Published: 9:20AM GMT 11 Jan 2010
http://www.telegraph.co.uk/earth/environment/globalwarming/6965342/Big-freeze-could-signal-global-warming-pause.html
Sunspot cycle 24: Together with sunspot cycle 25, the next two global cooling cycles. The new “Dalton Minimum?” Twenty Nine months now with low sunspots numbers, and counting. March was the 29th month of yet another low number of 15.4 http://en.wikipedia.org/wiki/Dalton_Minimum
Smoothed sunspot numbers (SSN). 2007, Oct. 0.9. The end of cycle 23.
Sunspot cycle 24: Nov 1.7. Dec 10.1. Jan 3.4. Feb 2.2. Mar 9.3 April 2.9. May: 2.9. June 3.1. July 0.5. August 0.5. Sep 1.1 Oct. 2.9. Nov. 4.1 Dec 0.8. Jan 1.5. Feb 1.4. Mar 0.7. Apr 1.2. May 2.9. June 2.6. July 3.5. Aug. 0.0. Sep 4.2. Oct 4.6. Nov 4.2. Dec 10.6 Jan 13.1 Feb 18.6 Mar 15.4.
Sunspots. http://solarscience.msfc.nasa.gov/SunspotCycle.shtml
The count. http://sidc.oma.be/products/ri_hemispheric/
Why a New Minimum. http://sesfoundation.org/dalton_minimum.pdf
The “Carrington Event,” September 1, 1859.
http://science.nasa.gov/headlines/y2008/06may_carringtonflare.htm
Current Space Weather.
http://www.swpc.noaa.gov/
What happened to global warming?
http://news.bbc.co.uk/1/hi/sci/tech/8299079.st
This week’s featured links: Silver & Gold Miners + Rare Metals.
With US trillion dollar deficits stretching as far as the eye can see, and voodoo economics the order of the day at the central banks, I think it is now time to begin selectively scaling into precious metals companies that mostly meet the following criteria:
Adequate cash reserves. Good management. Strong in-ground reserves or prospects. NAFTA based, or else located in countries with strong rule of law.
Endeavour Silver Corp. TSX: EDR. http://www.edrsilver.com/s/Home.asp
Semafo TSX: SMF http://www.semafo.com/home_company_intro.php
ATW Gold Corp. TSX.V: ATW. http://www.atwgold.com/
US Silver Corp. TSX.V: USA. http://www.us-silver.com/s/Home.asp
Excellon Resources Inc. TSX: EXN. http://www.excellonresources.com/
First Majestic Silver Corp. TSX: FR http://www.firstmajestic.com/s/Home.asp
New Jersey Mining Company. OTCBB: NJMC
http://www.newjerseymining.com/index.html
Atna Resources Ltd. TSX: ATN. http://www.atna.com/s/Home.asp
Barkerville Gold Mines TSX.V: BGM. Formerly International Wayside Gold Mines Ltd.
http://www.barkervillegold.com/s/Home.asp
Shoreham Resources Ltd. TSX-V: SMH
http://www.shoreham.ca/
ATAC Resources Ltd, TSX.V: ATC. http://www.atacresources.com/s/home.asp
Evolving Gold Corp. TSX.V: EVG http://www.evolvinggold.com/
Lydian International Ltd. TSX: LYD. Note: LYD operates in Armenia, a region carrying higher risk than our usual safer picks in NAFTA lands. http://www.lydianinternational.co.uk/
The story of rare earths and metals is mostly one of China producing and exporting, Japan, America and everyone else importing. Vital to our new technologies, and lifestyle, and critical to hybrid and electric cars, Rare Earth Elements and Heavy Rare Earths, are a strategic choke point held in China’s hands. Lately China has been squeezing that choke point. I think that AVL at Thor Lake Canada, has a property of global importance. A property with the ability to offer NAFTA access to REEs and HREs for the decades ahead. As America and the west move to reduce over dependence on oil from unstable regions, we will see demand for rare metals take off.
Avalon Rare Metals Inc. TSX: AVL. http://www.avalonraremetals.com/
We will be adding more REEs as appropriate.
Warning.
Sadly we are all in unexplored territory. The world has never before suffered a severe recession/depression while operating on fiat currency. As is widely apparent, the central banks haven’t a clue and are making up the rules as the flounder along. They never saw it coming they claim, although it was obvious to many fine writers though not unfortunately in the mainstream media, that a giant financialised derivatives gambling economy would always end badly. There are no experts now, for the simple reason that we have never before faced such a sudden synchronised and deep collapse in the global economies.
The unfortunate fact that we are operating on fraudulent currencies is highly likely to mean it all ends many months from now, in a fiat currency revulsion, but only after the monetary authorities have first tried pouring in endless amounts of newly created money. A derivatives gambling world with an estimated quadrillion dollars of face value has to be unwound and the losses absorbed. In this sort of investing environment, cash, gold and silver and tangible assets are favoured over stocks and intangible assets.
As always if thinking about making an investment, it’s important to do one’s own due diligence. No one has more at risk in an investment than you do yourself. In these difficult economic times, there will likely be several false bottoms before the real one arrives and hindsight allows us to confirm that the bottom is in. Even then, a “V” shaped rebound is highly improbable. A double dip recession seems likely. Beware the false "statistical" government subsidised "recovery." It is a "recovery" bought from a future of fiat currency collapse.
Graeme Irvine
London Irvine Report: www.londonirvinereport.com/
Thursday, 1 April 2010
A Happy Easter to All
Courtesy of the greats Bellini and Handel, and the excellent Welsh soprano Elin Manahan Thomas, Graeme's tribute to all for Easter 2010. A happy Easter and Passover to all. Our thoughts and prayers go out to all in the military and their families, to all affected by the atrocity in Moscow, and all suffering from the flooding in the USA and the earthquakes in Haiti and Chile.
Giovanni Bellini The Resurrection. 1475-79(Best with headphones.)
"Eternal source of light divine
With double warmth thy beams display
And with distinguished glory shine
To add lustre to this day."
Handel 1713
Elin Manahan Thomas, soprano
Cadeirlan Llandaf / Llandaf Cathedral
26 Lonawr, 2009 / 26 January, 2009
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