goldsilver.com
Tuesday, October 25, 2011
We Pay Tax for the Privilege to Have Currency
Michael Maloney, CEO and Founder of goldsilver.com speaks at the Casey Research/Sprott Summit When Money Dies.
The sold-out When Money Dies summit was a huge success, with attendees and participants alike receiving much to think about. If you missed it, you can still "be there," via a full set of audio recordings. These are available now, in CD or MP3 format for your convenience. http://bit.ly/whenmoneydies
Saturday, October 22, 2011
Worried About Silver? Listen to Eric Sprott’s Stump Speech
by John Rubino on October 21, 2011
Hedge fund manager Eric Sprott’s speech at this week’s Silver Summit turned a room full of nervous precious metals owners into pumped-up silver buyers. Some of the highlights are posted below, and here’s a link to a recent Financial Sense interview where he makes many of the same points.
* The US Mint sells about the same dollar amount of gold and silver coins, which means it sells 50 ounces of silver for every ounce of gold. It’s more or less the same story at GoldMoney and Sprott Money.
* Ten times more silver than gold is produced each year, and the ratio in the earth’s crust is 15:1, so how can the price be 50:1? Expect a return to the historical norm of 15:1, which implies that silver will outperform gold.
* The supply/demand picture has seen a 380 million ounce per year positive swing — in a 900 million ounce market. Where is the silver coming from?
* The paper silver markets trade a billion ounces a day and the world only produces 900 million in a year. The amount available for settlement of these futures contracts is something like 1.5 million ounces, ludicrously little compared to the amount of paper.
* “On the physical side I’m seeing only buyers.”
* “There are a lot more people who can afford a one-ounce silver coin than an ounce of gold.”
* Gold will be a reserve currency and silver will also play a role.
* “We tried to buy 15 million ounces of silver and had to wait three months — and some of the silver we got was manufactured after we ordered. So there’s not a lot of silver sitting on shelves waiting for people to buy it.”
* “Somewhere along the line some manufacturer will say ‘I can’t get the silver I want’ and the jig’s up.”
* People will prefer gold and silver to having money in a bank where there’s tremendous counterparty risk. Three months ago Dexia was considered to be the best capitalized European bank and now they’ve been nationalized.
* “You go to some of the biggest names who own gold and ask them about silver and a lot of them haven’t even looked at it.”
* Central banks are selling gold surreptitiously.
* “It’s shocking how undervalued the junior miners are…Gold and silver stocks are growth stocks. They all have a plan to increase production dramatically. Small miners can start a new mine and double in size…The relative value of gold stocks will become apparent with time…The breakout, when it comes, will be very sudden.”
Full disclosure: The staff at DollarCollapse is massively long precious metals, especially silver.
Original source
Hedge fund manager Eric Sprott’s speech at this week’s Silver Summit turned a room full of nervous precious metals owners into pumped-up silver buyers. Some of the highlights are posted below, and here’s a link to a recent Financial Sense interview where he makes many of the same points.
* The US Mint sells about the same dollar amount of gold and silver coins, which means it sells 50 ounces of silver for every ounce of gold. It’s more or less the same story at GoldMoney and Sprott Money.
* Ten times more silver than gold is produced each year, and the ratio in the earth’s crust is 15:1, so how can the price be 50:1? Expect a return to the historical norm of 15:1, which implies that silver will outperform gold.
* The supply/demand picture has seen a 380 million ounce per year positive swing — in a 900 million ounce market. Where is the silver coming from?
* The paper silver markets trade a billion ounces a day and the world only produces 900 million in a year. The amount available for settlement of these futures contracts is something like 1.5 million ounces, ludicrously little compared to the amount of paper.
* “On the physical side I’m seeing only buyers.”
* “There are a lot more people who can afford a one-ounce silver coin than an ounce of gold.”
* Gold will be a reserve currency and silver will also play a role.
* “We tried to buy 15 million ounces of silver and had to wait three months — and some of the silver we got was manufactured after we ordered. So there’s not a lot of silver sitting on shelves waiting for people to buy it.”
* “Somewhere along the line some manufacturer will say ‘I can’t get the silver I want’ and the jig’s up.”
* People will prefer gold and silver to having money in a bank where there’s tremendous counterparty risk. Three months ago Dexia was considered to be the best capitalized European bank and now they’ve been nationalized.
* “You go to some of the biggest names who own gold and ask them about silver and a lot of them haven’t even looked at it.”
* Central banks are selling gold surreptitiously.
* “It’s shocking how undervalued the junior miners are…Gold and silver stocks are growth stocks. They all have a plan to increase production dramatically. Small miners can start a new mine and double in size…The relative value of gold stocks will become apparent with time…The breakout, when it comes, will be very sudden.”
Full disclosure: The staff at DollarCollapse is massively long precious metals, especially silver.
Original source
Thursday, October 20, 2011
Eric Sprott: "Forces are at Work that can Move the Prices Down."
At the Casey Research/Sprott Summit When Money Dies, Louis James spoke with Sprott Inc. founder Eric Sprott on the risk involved in holding money in banks, and the likely future of precious metals stocks.
The sold-out When Money Dies summit was a huge success, with attendees and participants alike receiving much to think about. If you missed it, you can still "be there," via a full set of audio recordings. These are available now, in CD or MP3 format for your convenience. http://bit.ly/whenmoneydies
Tuesday, October 18, 2011
HOLY BAILOUT - Federal Reserve Now Backstopping $75 Trillion Of Bank Of America's Derivatives Trades
dailybail.com
OCTOBER 18, 2011
This story from Bloomberg just hit the wires this morning. Bank of America is shifting derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC.
This means that the investment bank's European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn't get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound. The Fed wants to "give relief" to the bank holding company, which is under heavy pressure.
This is a direct transfer of risk to the taxpayer done by the bank without approval by regulators and without public input. You will also read below that JP Morgan is apparently doing the same thing with $79 trillion of notional derivatives guaranteed by the FDIC and Federal Reserve.
What this means for you is that when Europe finally implodes and banks fail, U.S. taxpayers will hold the bag for trillions in CDS insurance contracts sold by Bank of America and JP Morgan. Even worse, the total exposure is unknown because Wall Street successfully lobbied during Dodd-Frank passage so that no central exchange would exist keeping track of net derivative exposure.
This is a recipe for Armageddon. Bernanke is absolutely insane. No wonder Geithner has been hopping all over Europe begging and cajoling leaders to put together a massive bailout of troubled banks. His worst nightmare is Eurozone bank defaults leading to the collapse of the large U.S. banks who have been happily selling default insurance on European banks since the crisis began.
---
Bloomberg
Excerpt:
Bank of America Corp. (BAC), hit by a credit downgrade last month, has moved derivatives from its Merrill Lynch unit to a subsidiary flush with insured deposits, according to people with direct knowledge of the situation.
The Federal Reserve and Federal Deposit Insurance Corp. disagree over the transfers, which are being requested by counterparties, said the people, who asked to remain anonymous because they weren’t authorized to speak publicly. The Fed has signaled that it favors moving the derivatives to give relief to the bank holding company, while the FDIC, which would have to pay off depositors in the event of a bank failure, is objecting, said the people. The bank doesn’t believe regulatory approval is needed, said people with knowledge of its position.
Three years after taxpayers rescued some of the biggest U.S. lenders, regulators are grappling with how to protect FDIC- insured bank accounts from risks generated by investment-banking operations. Bank of America, which got a $45 billion bailout during the financial crisis, had $1.04 trillion in deposits as of midyear, ranking it second among U.S. firms.
“The concern is that there is always an enormous temptation to dump the losers on the insured institution,” said William Black, professor of economics and law at the University of Missouri-Kansas City and a former bank regulator. “We should have fairly tight restrictions on that.”
more
OCTOBER 18, 2011
This story from Bloomberg just hit the wires this morning. Bank of America is shifting derivatives in its Merrill investment banking unit to its depository arm, which has access to the Fed discount window and is protected by the FDIC.
This means that the investment bank's European derivatives exposure is now backstopped by U.S. taxpayers. Bank of America didn't get regulatory approval to do this, they just did it at the request of frightened counterparties. Now the Fed and the FDIC are fighting as to whether this was sound. The Fed wants to "give relief" to the bank holding company, which is under heavy pressure.
This is a direct transfer of risk to the taxpayer done by the bank without approval by regulators and without public input. You will also read below that JP Morgan is apparently doing the same thing with $79 trillion of notional derivatives guaranteed by the FDIC and Federal Reserve.
What this means for you is that when Europe finally implodes and banks fail, U.S. taxpayers will hold the bag for trillions in CDS insurance contracts sold by Bank of America and JP Morgan. Even worse, the total exposure is unknown because Wall Street successfully lobbied during Dodd-Frank passage so that no central exchange would exist keeping track of net derivative exposure.
This is a recipe for Armageddon. Bernanke is absolutely insane. No wonder Geithner has been hopping all over Europe begging and cajoling leaders to put together a massive bailout of troubled banks. His worst nightmare is Eurozone bank defaults leading to the collapse of the large U.S. banks who have been happily selling default insurance on European banks since the crisis began.
---
Bloomberg
Excerpt:
Bank of America Corp. (BAC), hit by a credit downgrade last month, has moved derivatives from its Merrill Lynch unit to a subsidiary flush with insured deposits, according to people with direct knowledge of the situation.
The Federal Reserve and Federal Deposit Insurance Corp. disagree over the transfers, which are being requested by counterparties, said the people, who asked to remain anonymous because they weren’t authorized to speak publicly. The Fed has signaled that it favors moving the derivatives to give relief to the bank holding company, while the FDIC, which would have to pay off depositors in the event of a bank failure, is objecting, said the people. The bank doesn’t believe regulatory approval is needed, said people with knowledge of its position.
Three years after taxpayers rescued some of the biggest U.S. lenders, regulators are grappling with how to protect FDIC- insured bank accounts from risks generated by investment-banking operations. Bank of America, which got a $45 billion bailout during the financial crisis, had $1.04 trillion in deposits as of midyear, ranking it second among U.S. firms.
“The concern is that there is always an enormous temptation to dump the losers on the insured institution,” said William Black, professor of economics and law at the University of Missouri-Kansas City and a former bank regulator. “We should have fairly tight restrictions on that.”
more
Every Silver Pullback Is A Gift - Mike Maloney
Listen to Mike Maloney's thoughts on the current price action in silver. Learn why he sees this as short term noise, and that we are ultimately headed for far higher prices for precious metals.
Hong Kong becomes first centre for gold trading in yuan
Yuan notes China has been seeking a bigger international role for its currency
Continue reading the main story
Related Stories
Hong Kong has become the world's first place to offer gold trading in yuan, cementing its status as an offshore hub for the Chinese currency.
The Chinese Gold & Silver Exchange Society (CGSE) said it will offer offshore renminbi-denominated spot gold contracts to investors.
The move comes amid a push by Chinese authorities for a more international role for its currency.
Hong Kong is the world's third-largest gold trading centre.
"By attracting both local and international investors, the Renminbi Kilobar Gold is a significant step towards internationalizing the renminbi," said Haywood Cheung, president of CGSE.
It also consolidates Hong Kong's position as an offshore renminbi centre by providing investors with a new alternative in leveraged trading of renminbi, which has until now been lacking”
The growth of the Chinese economy coupled with a push by the authorities for a more global role for their currency has seen an increased demand for yuan-denominated investment products.
At the same time Hong Kong has been trying to promote the city as the offshore trading hub for the yuan.
The demand has grown further by the increasing amount of offshore deposits of the Chinese currency in the city which rose 6.4% in August to 609bn yuan ($95bn; £60bn).
more
Continue reading the main story
Related Stories
Hong Kong has become the world's first place to offer gold trading in yuan, cementing its status as an offshore hub for the Chinese currency.
The Chinese Gold & Silver Exchange Society (CGSE) said it will offer offshore renminbi-denominated spot gold contracts to investors.
The move comes amid a push by Chinese authorities for a more international role for its currency.
Hong Kong is the world's third-largest gold trading centre.
"By attracting both local and international investors, the Renminbi Kilobar Gold is a significant step towards internationalizing the renminbi," said Haywood Cheung, president of CGSE.
It also consolidates Hong Kong's position as an offshore renminbi centre by providing investors with a new alternative in leveraged trading of renminbi, which has until now been lacking”
The growth of the Chinese economy coupled with a push by the authorities for a more global role for their currency has seen an increased demand for yuan-denominated investment products.
At the same time Hong Kong has been trying to promote the city as the offshore trading hub for the yuan.
The demand has grown further by the increasing amount of offshore deposits of the Chinese currency in the city which rose 6.4% in August to 609bn yuan ($95bn; £60bn).
more
Brad Meltzer's Decoded: Fort Knox Gold? and Confederate Gold
Brad Meltzer's Decoded: Fort Knox Gold?
New television series by history channel is investigating the Declaration of Independence. Which also examines the question of whether the U.S. government really still has any gold in the vault at Fort Knox, Kentucky. The program, to be broadcast on the History Channel, stresses the secrecy and unaccountability of the government in regard to anything related to gold.
http://www.history.com/shows/brad-meltzers-decoded/videos/brad-meltz-decode
------------------------
Brad Meltzer's Decoded: Confederate Gold
Legend has it that millions of dollars worth of missing gold and silver from the Confederate treasury are still buried in secret hiding places across America. Brad and his team investigate.
http://www.history.com/shows/brad-meltzers-decoded/videos/playlists/season-1-full-episodes#brad-meltzers-decoded-confederate-gold
New television series by history channel is investigating the Declaration of Independence. Which also examines the question of whether the U.S. government really still has any gold in the vault at Fort Knox, Kentucky. The program, to be broadcast on the History Channel, stresses the secrecy and unaccountability of the government in regard to anything related to gold.
http://www.history.com/shows/brad-meltzers-decoded/videos/brad-meltz-decode
------------------------
Brad Meltzer's Decoded: Confederate Gold
Legend has it that millions of dollars worth of missing gold and silver from the Confederate treasury are still buried in secret hiding places across America. Brad and his team investigate.
http://www.history.com/shows/brad-meltzers-decoded/videos/playlists/season-1-full-episodes#brad-meltzers-decoded-confederate-gold
Monday, October 17, 2011
Bank Closing Information
October 14, 2011
These links contain useful information for the customers and vendors of these closed banks.
loadingLoading Data.. Country Bank, Aledo, IL
First State Bank, Cranford, NJ
Blue Ridge Savings Bank, Inc., Asheville, NC
Piedmont Community Bank, Gray, GA
Source
These links contain useful information for the customers and vendors of these closed banks.
loadingLoading Data.. Country Bank, Aledo, IL
First State Bank, Cranford, NJ
Blue Ridge Savings Bank, Inc., Asheville, NC
Piedmont Community Bank, Gray, GA
Source
Saturday, October 15, 2011
Gold and silver legal tender in Utah-On the Edge with Max Keiser-10-07-2011
In this edition of the show Max interviews David Morgan from Silver-Investor.com.
He will talk about the new law implemented in the state of Utah making gold and silver legal tender.
So from now on the merchants in the state of Utah will start accepting gold and silver coins on a voluntary basis.
There is a depository that was set up where people can put their gold and silver into and are being issued a debit card which makes the whole transaction process pretty transparent.
And now you can walk to any store and buy whatever you want to buy with your debit card.
http://www.presstv.com/Program/203419.html
Ron Paul- House Floor Speech 'American Republic Almost Completely Dead' - NaturalNews.tv
Ron Paul- House Floor Speech 'American Republic Almost Completely Dead' - NaturalNews.tv
Video Information
The Last Nail The last nail is being driven into the coffin of the American Republic. Yet, Congress remains in total denial as our liberties are rapidly fading before our eyes. The process is propelled by unwarranted fear and ignorance as to the true meaning of liberty. It is driven by economic myths, fallacies and irrational good intentions. The rule of law is constantly rejected and authoritarian answers are offered as panaceas for all our problems. Runaway welfarism is used to benefit the rich at the expense of the middle class. Who would have ever thought that the current generation and Congress would stand idly by and watch such a rapid disintegration of the American Republic? Characteristic of this epic event is the casual acceptance by the people and political leaders of the unitary presidency, which is equivalent to granting dictatorial powers to the President. Our Presidents can now, on their own:
1. Order assassinations, including American citizens,
2. Operate secret military tribunals,
3. Engage in torture,
4. Enforce indefinite imprisonment without due process,
5. Order searches and seizures without proper warrants, gutting the 4th Amendment,
6. Ignore the 60 day rule for reporting to the Congress the nature of any military operations as required by the War Power Resolution,
7. Continue the Patriot Act abuses without oversight,
8. Wage war at will,
9. Treat all Americans as suspected terrorists at airports with TSA groping and nude x-raying.
And the Federal Reserve accommodates by counterfeiting the funds needed and not paid for by taxation and borrowing, permitting runaway spending, endless debt, and special interest bail-outs.
And all of this is not enough. The abuses and usurpations of the war power are soon to be codified in the National Defense Authorization Act now rapidly moving its way through the Congress. Instead of repealing the 2001 Authorization for the Use of Military Force (AUMF), as we should, now that bin Laden is dead and gone, Congress is planning to massively increase the war power of the President. Though an opportunity presents itself to end the wars in Iraq, Afghanistan, and Pakistan, Congress, with bipartisan support, obsesses on how to expand the unconstitutional war power the President already holds. The current proposal would allow a President to pursue war any time, any place, for any reason, without Congressional approval. Many believe this would even permit military activity against American suspects here at home. The proposed authority does not reference the 9/11 attacks. It would be expanded to include the Taliban and "associated" forces—a dangerously vague and expansive definition of our potential enemies. There is no denial that the changes in s.1034 totally eliminate the hard-fought-for restraint on Presidential authority to go to war without Congressional approval achieved at the Constitutional Convention. Congress' war authority has been severely undermined since World War II beginning with the advent of the Korean War which was fought solely under a UN Resolution. Even today, we're waging war in Libya without even consulting with the Congress, similar to how we went to war in Bosnia in the 1990s under President Clinton. The three major reasons for our Constitutional Convention were to:
1. Guarantee free trade and travel among the states.
2. Make gold and silver legal tender and abolish paper money.
3. Strictly limit the Executive Branch's authority to pursue war without Congressional approval.
But today:
1. Federal Reserve notes are legal tender, gold and silver are illegal.
2. The Interstate Commerce Clause is used to regulate all commerce at the expense of free trade among the states.
3. And now the final nail is placed in the coffin of Congressional responsibility for the war power, delivering this power completely to the President—a sharp and huge blow to the concept of our Republic.
In my view, it appears that the fate of the American Republic is now sealed—unless these recent trends are quickly reversed.
The saddest part of this tragedy is that all these horrible changes are being done in the name of patriotism and protecting freedom. They are justified by good intentions while believing the sacrifice of liberty is required for our safety. Nothing could be further from the truth.
More sadly is the conviction that our enemies are driven to attack us for our freedoms and prosperity, and not because of our deeply flawed foreign policy that has generated justifiable grievances and has inspired the radical violence against us. Without this understanding our endless, unnamed, and undeclared wars will continue and our wonderful experience with liberty will end.
Learn more at: http://www.campaignforliberty.com/
Video Information
The Last Nail The last nail is being driven into the coffin of the American Republic. Yet, Congress remains in total denial as our liberties are rapidly fading before our eyes. The process is propelled by unwarranted fear and ignorance as to the true meaning of liberty. It is driven by economic myths, fallacies and irrational good intentions. The rule of law is constantly rejected and authoritarian answers are offered as panaceas for all our problems. Runaway welfarism is used to benefit the rich at the expense of the middle class. Who would have ever thought that the current generation and Congress would stand idly by and watch such a rapid disintegration of the American Republic? Characteristic of this epic event is the casual acceptance by the people and political leaders of the unitary presidency, which is equivalent to granting dictatorial powers to the President. Our Presidents can now, on their own:
1. Order assassinations, including American citizens,
2. Operate secret military tribunals,
3. Engage in torture,
4. Enforce indefinite imprisonment without due process,
5. Order searches and seizures without proper warrants, gutting the 4th Amendment,
6. Ignore the 60 day rule for reporting to the Congress the nature of any military operations as required by the War Power Resolution,
7. Continue the Patriot Act abuses without oversight,
8. Wage war at will,
9. Treat all Americans as suspected terrorists at airports with TSA groping and nude x-raying.
And the Federal Reserve accommodates by counterfeiting the funds needed and not paid for by taxation and borrowing, permitting runaway spending, endless debt, and special interest bail-outs.
And all of this is not enough. The abuses and usurpations of the war power are soon to be codified in the National Defense Authorization Act now rapidly moving its way through the Congress. Instead of repealing the 2001 Authorization for the Use of Military Force (AUMF), as we should, now that bin Laden is dead and gone, Congress is planning to massively increase the war power of the President. Though an opportunity presents itself to end the wars in Iraq, Afghanistan, and Pakistan, Congress, with bipartisan support, obsesses on how to expand the unconstitutional war power the President already holds. The current proposal would allow a President to pursue war any time, any place, for any reason, without Congressional approval. Many believe this would even permit military activity against American suspects here at home. The proposed authority does not reference the 9/11 attacks. It would be expanded to include the Taliban and "associated" forces—a dangerously vague and expansive definition of our potential enemies. There is no denial that the changes in s.1034 totally eliminate the hard-fought-for restraint on Presidential authority to go to war without Congressional approval achieved at the Constitutional Convention. Congress' war authority has been severely undermined since World War II beginning with the advent of the Korean War which was fought solely under a UN Resolution. Even today, we're waging war in Libya without even consulting with the Congress, similar to how we went to war in Bosnia in the 1990s under President Clinton. The three major reasons for our Constitutional Convention were to:
1. Guarantee free trade and travel among the states.
2. Make gold and silver legal tender and abolish paper money.
3. Strictly limit the Executive Branch's authority to pursue war without Congressional approval.
But today:
1. Federal Reserve notes are legal tender, gold and silver are illegal.
2. The Interstate Commerce Clause is used to regulate all commerce at the expense of free trade among the states.
3. And now the final nail is placed in the coffin of Congressional responsibility for the war power, delivering this power completely to the President—a sharp and huge blow to the concept of our Republic.
In my view, it appears that the fate of the American Republic is now sealed—unless these recent trends are quickly reversed.
The saddest part of this tragedy is that all these horrible changes are being done in the name of patriotism and protecting freedom. They are justified by good intentions while believing the sacrifice of liberty is required for our safety. Nothing could be further from the truth.
More sadly is the conviction that our enemies are driven to attack us for our freedoms and prosperity, and not because of our deeply flawed foreign policy that has generated justifiable grievances and has inspired the radical violence against us. Without this understanding our endless, unnamed, and undeclared wars will continue and our wonderful experience with liberty will end.
Learn more at: http://www.campaignforliberty.com/
Friday, October 14, 2011
James Turk Interview Video
They talk about the dynamics of the gold market and how it has entered the second phase of its bull market. They look at ETF, central bank and coin demand. They also look at the huge paper-to-physical mismatch. Eric calculates that only 0.75% of financial assets are currently in gold.
They discuss the importance of owning physical, not paper gold, and keeping it yourself or with a trustworthy company that gives you direct access to it. They talk about GATA and the significance of the work they do. They also talk about Sprott PHYS and PSLV and how they allow holders the option to redeem their physical metal, unlike most other ETFs.
They talk about fiat currencies and their flaws. The dollar, the euro and how bank leverage has built up since the Fed was established in 1913, setting the stage for a huge crash. Eric talks about bank failure Friday, the numbers released by the FDIC and all the signs pointing to the coming train wreck.
They talk about the attempts to prevent liquidation of bad assets and how governments are throwing good money after bad. Eric then talks about the 3 conditions that he thinks are necessary to see gold as overvalued, and how we are very far from that point at this stage. Both James and Eric see gold as reaching a parabolic phase before the bull market runs its course. They also comment on how little confidence most mining companies have in gold. This interview was recorded on August 4 2011 in London.
Eric Sprott is a shareholder of GoldMoney.
Original source
U.S. Collapse Predicted
Casey Research Chief Economist Bud Conrad believes the United States is acting as a late-stage empire, acting aggressively on the world stage, lowering its moral standards and debasing its currency. In this exclusive interview with The Gold Report at the Casey Research/Sprott Inc. "When Money Dies" Summit, he explains the options for how the inevitable collapse will occur.
The Gold Report: At the Casey Research/Sprott Inc. Summit, you gave a presentation called, "A Crisis of Confidence." After all the government stimulus from the U.S. and the rest of the world aimed at injecting liquidity and keeping interest rates low, why didn't any of it work? Why is the economy still hurting?
Bud Conrad: First, printing money doesn't create wealth. Putting bits in a computer doesn't create wealth. When politicians hand out money, they are the ones who get powerful and the banks get wealthy. The middle class with savings gets hurt. What creates wealth is people working and creating things.
Internationally, the Chinese are papering over their slowing growth rate by providing liquidity, but paper money systems will collapse. That is the reality. The global financial system is supremely unstable. When people wake up to the fact that this is a "king ain’t got no clothes" economy, we will see a run to the exits.
TGR: It seems like we are saying that the currency is going to fail because of debt to gross domestic product (GDP), not because governments can print money. If governments were disciplined, then would printing money be a problem?
BC: When the U.S., and therefore every other country, went off the last vestige of the gold standard, we were placed in a fairyland. That is even more important than the debt. It is linked. Debt is the result of the ability to print money. If there were redeemability, the U.S would have stopped issuing debt when it ran out of money. Without fiat currency, the country wouldn't have reached the current level of debt.
No government is disciplined. My question is: "Why are people letting them get away with it? Why aren't people out protesting in the streets?" Thousands of bankers should be in jail right now. There is an attitude of resignation in young people today that dismays me. Maybe they know they can't fight city hall.
TGR: If we are all resigned that whatever is going to happen will happen, how can people protect themselves?
BC: A lot of people probably believe that everything will be okay. When we have a financial collapse and people stop getting their payments and they see bankers and government contractors getting rich, maybe people will take matters into their own hands. It could be dangerous to be in the streets because people who are hungry will rob you.
TGR: If the bubble has already broken in the U.S. stock and real estate market and is getting ready to burst in China, are there any upside opportunities?
BC: In a paper money/fiat currency collapse, the things to hold are real assets—gold and oil will look like you are making money. Gold doesn't change. It is just gold. When the price goes up, the metal isn't any different. Only the dollar is going down.
There is also a moral component to the question. A lot of people are getting out of the country. This is where I was born and where my family lives and I am an American so I probably won't go anywhere, but a lot of people are considering moving out of the U.S. to protect themselves and their assets.
TGR: What is your biggest fear for your children?
BC: That the government has turned it into a totalitarian state where the people don't have personal freedoms to assemble, think and live their lives without surveillance, over-taxation and subservience to the state. I worry that my children and grandchildren could be impoverished by conflict, by a society that dissipates it resources in wars that only destroy wealth, rather than creating anything.
I also worry about how they will fuel their economic growth. Fossil fuels created the abundance of our generation like humanity has never experienced before. We have used half of the dinosaur remains out there. If we use it all up, then we will have to reduce the number of people on the planet. Now we need to start thinking about what is next. I don't know how my grandchildren will live in an abundant society when energy becomes so expensive and scarce that we have big wars over it. It's already happening. Energy explains the conflicts in the Middle East more than religion ever could.
TGR: You have said we are entering Cold War II. Can you explain that?
BC: Everyone is uncomfortable with the role we played in the Middle East. They fear we could enter a World War III. But a cold war is not a conflict between the main parties. We didn't battle with the Russians directly. We fought in Vietnam. The same is going on with China in an economic war over resources. The U.S. bombs the place in hopes that a new government will come in and give us cheap oil while China is busy winning contracts for the access to resources in many far-flung regions from oil in Africa to soybeans in South America. China is building cultural centers and roads to mines in an attempt to gain the favor of the people while gaining access to resources. Our approach of bombing people just makes enemies and is very expensive. It is another example of the stupidity of a late-stage empire.
TGR: You have referred to the fight over access to oil, but I hear the U.S. is the Saudi Arabia of natural gas. Can that replace oil in the future?
BC: Like any extractive resources, we have to approach this new technology with care. Fracking can leave a messed up underground and contaminate water. But natural gas is abundant and affordable and it can make a difference.
TGR: What about uranium?
BC: The problem is not just the radiation and the bad design of the early plants revealed by Fukushima. The problem is that it isn't price competitive. We can build nuclear plants safely, but it isn't cost effective compared to oil or natural gas. There will still be a uranium mining business in replacing spent nuclear fuel, but not in building new plants for a while.
TGR: You mentioned we will soon have two retirees collecting benefits for every one worker. What is the solution for the imbalance between workers and beneficiaries short of older people wandering off into the desert so they won't be a liability on their families?
BC: The government will continue to print money to meet its obligations to retirees, but the problem is that those dollars won't buy as much in the future. That is why people are trying to find protection for their retirement assets. Those relying on Social Security will find it difficult.
TGR: We have heard about a possible economic slowdown or collapse in China, but it has one of the highest personal savings rates in the world. Wouldn't that mitigate some of the economic turmoil of a real estate bubble bursting?
BC: China is strong because it has gone through so many revolutionary problems during the lifetime of people who can still remember. The Chinese know how bad it can be so they fight to avoid returning to economic subsistence levels. What China has done economically puts Japan's economic miracle to shame. The country has overbuilt during the last few years, but it has a lot of people and the one-child policy is being dismantled. It will manage any bubble bursting well. We, in the U.S., have an arrogance of wealth and that blinds us to possible problems. That is why we are unwilling to take the strong necessary steps to right our economic disasters of too much debt, too much government and little concern for concentrating on economic development.
TGR: You said you are expecting a recession next year and a weaker economy or "stagflation." Will that be limited to the U.S. or will it impact the entire world economy?
BC: The U.S. economy will suffer greatly because we are unprepared for how serious the situation will become, but this is a worldwide phenomenon. Inflationary central bank printing is going on in Europe and China so they will be impacted as well. The world is interconnected so what happens in the U.S. does spill over into other economies and the other way around. The European weak countries failing will cause several big European banks to fail, be nationalized and cause debt crisis for U.S. banks as well. International contagion is particularly true when the U.S. starts wars to divert people from thinking about the economy. Wars damage productivity of personal consumption and therefore the perceived wealth of individuals.
I think of the U.S. as a late-stage empire. There are lots of ways to collapse. The Third Reich collapsed cataclysmically. The British Empire wound down in a gentlemanly fashion. I think the U.S. is headed to Roman type of collapse where the internal dissipation was as big a problem as the external conflicts. We have a culture of corruption with no accountability. In this most recent crisis, no bankers have been indicted, never mind convicted, compared to the Savings and Loan crisis, when thousands went to jail.
TGR: How are you protecting your wealth?
BC: I have some precious metals and energy. I expect interest rates to rise.
TGR: You are predicting a weaker economy. When are interest rates going to move?
BC: How about now? I warn you, I have been wrong before. I predicted the debasement of currency would require higher interest rates to get people to invest. I didn't give enough credit to the Federal Reserve's ability to manipulate the market. We are now at record low rates and the government deficit is at such extremes that rates can only go up. I don't know how it will all unravel. But at some point people will wake up to this sham and they won't want to keep their money in banks. Then they will go buy physical assets, gold and food and, sometime later, real estate.
TGR: After all this bailing out, what will be the trigger point for a collapse?
BC: We all want to know that. We look at the numbers and I can't see it going on for the rest of the decade. When it goes, it could go very rapidly. The markets feed on themselves more now than at any other point in time. What happened over a period of years in the Great Depression could take weeks this time around. Currency collapse could happen quickly. The collapse is already happening in Europe and more countries may follow Greece.
This is not war; it is merely the collapse of a currency. People aren't wiped out by the thousands. But their savings are. Currency disintegration is not unusual. It happens all the time—about once a generation a collapse happens in every country. The fact that the U.S. dollar is the second oldest in existence today is an anomaly, an anomaly that may come to an end soon.
Bud Conrad holds a Bachelor of Engineering degree from Yale and an MBA from Harvard. He has held positions with IBM, CDC, Amdahl and Tandem. Conrad, a futures investor for 25 years and a full-time investor for a decade, is also sought after as keynote speaker in Dubai, New Zealand, Vancouver, New York and many other cities. He has appeared on TV on CNBC, FOX, and on many radio shows. As chief economist at Casey Research, he produces original analysis.
For the complete audio collection of the Casey Research/Sprott Inc. Summit "When the Money Dies," click here.
Original source
The Gold Report: At the Casey Research/Sprott Inc. Summit, you gave a presentation called, "A Crisis of Confidence." After all the government stimulus from the U.S. and the rest of the world aimed at injecting liquidity and keeping interest rates low, why didn't any of it work? Why is the economy still hurting?
Bud Conrad: First, printing money doesn't create wealth. Putting bits in a computer doesn't create wealth. When politicians hand out money, they are the ones who get powerful and the banks get wealthy. The middle class with savings gets hurt. What creates wealth is people working and creating things.
Internationally, the Chinese are papering over their slowing growth rate by providing liquidity, but paper money systems will collapse. That is the reality. The global financial system is supremely unstable. When people wake up to the fact that this is a "king ain’t got no clothes" economy, we will see a run to the exits.
TGR: It seems like we are saying that the currency is going to fail because of debt to gross domestic product (GDP), not because governments can print money. If governments were disciplined, then would printing money be a problem?
BC: When the U.S., and therefore every other country, went off the last vestige of the gold standard, we were placed in a fairyland. That is even more important than the debt. It is linked. Debt is the result of the ability to print money. If there were redeemability, the U.S would have stopped issuing debt when it ran out of money. Without fiat currency, the country wouldn't have reached the current level of debt.
No government is disciplined. My question is: "Why are people letting them get away with it? Why aren't people out protesting in the streets?" Thousands of bankers should be in jail right now. There is an attitude of resignation in young people today that dismays me. Maybe they know they can't fight city hall.
TGR: If we are all resigned that whatever is going to happen will happen, how can people protect themselves?
BC: A lot of people probably believe that everything will be okay. When we have a financial collapse and people stop getting their payments and they see bankers and government contractors getting rich, maybe people will take matters into their own hands. It could be dangerous to be in the streets because people who are hungry will rob you.
TGR: If the bubble has already broken in the U.S. stock and real estate market and is getting ready to burst in China, are there any upside opportunities?
BC: In a paper money/fiat currency collapse, the things to hold are real assets—gold and oil will look like you are making money. Gold doesn't change. It is just gold. When the price goes up, the metal isn't any different. Only the dollar is going down.
There is also a moral component to the question. A lot of people are getting out of the country. This is where I was born and where my family lives and I am an American so I probably won't go anywhere, but a lot of people are considering moving out of the U.S. to protect themselves and their assets.
TGR: What is your biggest fear for your children?
BC: That the government has turned it into a totalitarian state where the people don't have personal freedoms to assemble, think and live their lives without surveillance, over-taxation and subservience to the state. I worry that my children and grandchildren could be impoverished by conflict, by a society that dissipates it resources in wars that only destroy wealth, rather than creating anything.
I also worry about how they will fuel their economic growth. Fossil fuels created the abundance of our generation like humanity has never experienced before. We have used half of the dinosaur remains out there. If we use it all up, then we will have to reduce the number of people on the planet. Now we need to start thinking about what is next. I don't know how my grandchildren will live in an abundant society when energy becomes so expensive and scarce that we have big wars over it. It's already happening. Energy explains the conflicts in the Middle East more than religion ever could.
TGR: You have said we are entering Cold War II. Can you explain that?
BC: Everyone is uncomfortable with the role we played in the Middle East. They fear we could enter a World War III. But a cold war is not a conflict between the main parties. We didn't battle with the Russians directly. We fought in Vietnam. The same is going on with China in an economic war over resources. The U.S. bombs the place in hopes that a new government will come in and give us cheap oil while China is busy winning contracts for the access to resources in many far-flung regions from oil in Africa to soybeans in South America. China is building cultural centers and roads to mines in an attempt to gain the favor of the people while gaining access to resources. Our approach of bombing people just makes enemies and is very expensive. It is another example of the stupidity of a late-stage empire.
TGR: You have referred to the fight over access to oil, but I hear the U.S. is the Saudi Arabia of natural gas. Can that replace oil in the future?
BC: Like any extractive resources, we have to approach this new technology with care. Fracking can leave a messed up underground and contaminate water. But natural gas is abundant and affordable and it can make a difference.
TGR: What about uranium?
BC: The problem is not just the radiation and the bad design of the early plants revealed by Fukushima. The problem is that it isn't price competitive. We can build nuclear plants safely, but it isn't cost effective compared to oil or natural gas. There will still be a uranium mining business in replacing spent nuclear fuel, but not in building new plants for a while.
TGR: You mentioned we will soon have two retirees collecting benefits for every one worker. What is the solution for the imbalance between workers and beneficiaries short of older people wandering off into the desert so they won't be a liability on their families?
BC: The government will continue to print money to meet its obligations to retirees, but the problem is that those dollars won't buy as much in the future. That is why people are trying to find protection for their retirement assets. Those relying on Social Security will find it difficult.
TGR: We have heard about a possible economic slowdown or collapse in China, but it has one of the highest personal savings rates in the world. Wouldn't that mitigate some of the economic turmoil of a real estate bubble bursting?
BC: China is strong because it has gone through so many revolutionary problems during the lifetime of people who can still remember. The Chinese know how bad it can be so they fight to avoid returning to economic subsistence levels. What China has done economically puts Japan's economic miracle to shame. The country has overbuilt during the last few years, but it has a lot of people and the one-child policy is being dismantled. It will manage any bubble bursting well. We, in the U.S., have an arrogance of wealth and that blinds us to possible problems. That is why we are unwilling to take the strong necessary steps to right our economic disasters of too much debt, too much government and little concern for concentrating on economic development.
TGR: You said you are expecting a recession next year and a weaker economy or "stagflation." Will that be limited to the U.S. or will it impact the entire world economy?
BC: The U.S. economy will suffer greatly because we are unprepared for how serious the situation will become, but this is a worldwide phenomenon. Inflationary central bank printing is going on in Europe and China so they will be impacted as well. The world is interconnected so what happens in the U.S. does spill over into other economies and the other way around. The European weak countries failing will cause several big European banks to fail, be nationalized and cause debt crisis for U.S. banks as well. International contagion is particularly true when the U.S. starts wars to divert people from thinking about the economy. Wars damage productivity of personal consumption and therefore the perceived wealth of individuals.
I think of the U.S. as a late-stage empire. There are lots of ways to collapse. The Third Reich collapsed cataclysmically. The British Empire wound down in a gentlemanly fashion. I think the U.S. is headed to Roman type of collapse where the internal dissipation was as big a problem as the external conflicts. We have a culture of corruption with no accountability. In this most recent crisis, no bankers have been indicted, never mind convicted, compared to the Savings and Loan crisis, when thousands went to jail.
TGR: How are you protecting your wealth?
BC: I have some precious metals and energy. I expect interest rates to rise.
TGR: You are predicting a weaker economy. When are interest rates going to move?
BC: How about now? I warn you, I have been wrong before. I predicted the debasement of currency would require higher interest rates to get people to invest. I didn't give enough credit to the Federal Reserve's ability to manipulate the market. We are now at record low rates and the government deficit is at such extremes that rates can only go up. I don't know how it will all unravel. But at some point people will wake up to this sham and they won't want to keep their money in banks. Then they will go buy physical assets, gold and food and, sometime later, real estate.
TGR: After all this bailing out, what will be the trigger point for a collapse?
BC: We all want to know that. We look at the numbers and I can't see it going on for the rest of the decade. When it goes, it could go very rapidly. The markets feed on themselves more now than at any other point in time. What happened over a period of years in the Great Depression could take weeks this time around. Currency collapse could happen quickly. The collapse is already happening in Europe and more countries may follow Greece.
This is not war; it is merely the collapse of a currency. People aren't wiped out by the thousands. But their savings are. Currency disintegration is not unusual. It happens all the time—about once a generation a collapse happens in every country. The fact that the U.S. dollar is the second oldest in existence today is an anomaly, an anomaly that may come to an end soon.
Bud Conrad holds a Bachelor of Engineering degree from Yale and an MBA from Harvard. He has held positions with IBM, CDC, Amdahl and Tandem. Conrad, a futures investor for 25 years and a full-time investor for a decade, is also sought after as keynote speaker in Dubai, New Zealand, Vancouver, New York and many other cities. He has appeared on TV on CNBC, FOX, and on many radio shows. As chief economist at Casey Research, he produces original analysis.
For the complete audio collection of the Casey Research/Sprott Inc. Summit "When the Money Dies," click here.
Original source
more on gold
Troy Ounce
The traditional unit of weight for gold is the troy ounce, being 31.1034807 grams.
32.15 troy ounces = 1 kilogram
1000 troy ounce bar = 31 kilograms
400 troy ounce gold bar = 12.5 kilograms (1000grams)
1 troy ounce = 480 grains
1 troy ounce = 20 penny weights (North America)
6.02 troy ounces = 5 taels (Hong Kong)
3.75 troy ounces = 10 tolas (Indian)
1 troy ounce = 155.52 metric carats (diamonds and gemstones).
Mint
The principal mints striking gold and or silver coins are:
Australia; Perth Mint, operated by the Western Australia government’s Gold Corporation makes the Nugget Bullion coin and special issues, such as Sydney 2000 Olympic Coins. The Royal Australian Mint mainly issues collector coins.
Austria: Austrian Mint; making Philharmoniker coin and formerly, the 100 Corona re-strike.
Canada: Royal Canadian Mint; making Maple Leaf bullion coin and special issues;
Chine; China Mint, Beijing, making Panda Coin
Singapore; Singapore Mint, part of Chartered Industries, making some special gold coin issues;
South Africa; The South African Mint, making Krugerrand and some special issues of one and two rand coins;
United Kingdom; Royal Mint, making Britannia bullion coin, Sovereigns and some special issue proof coins for other clients;
United States of America; United States Mint, making the Eagle bullion coin.
Mexico; Casa de Moneda, making Centenario coin and special issue
The traditional unit of weight for gold is the troy ounce, being 31.1034807 grams.
32.15 troy ounces = 1 kilogram
1000 troy ounce bar = 31 kilograms
400 troy ounce gold bar = 12.5 kilograms (1000grams)
1 troy ounce = 480 grains
1 troy ounce = 20 penny weights (North America)
6.02 troy ounces = 5 taels (Hong Kong)
3.75 troy ounces = 10 tolas (Indian)
1 troy ounce = 155.52 metric carats (diamonds and gemstones).
Mint
The principal mints striking gold and or silver coins are:
Australia; Perth Mint, operated by the Western Australia government’s Gold Corporation makes the Nugget Bullion coin and special issues, such as Sydney 2000 Olympic Coins. The Royal Australian Mint mainly issues collector coins.
Austria: Austrian Mint; making Philharmoniker coin and formerly, the 100 Corona re-strike.
Canada: Royal Canadian Mint; making Maple Leaf bullion coin and special issues;
Chine; China Mint, Beijing, making Panda Coin
Singapore; Singapore Mint, part of Chartered Industries, making some special gold coin issues;
South Africa; The South African Mint, making Krugerrand and some special issues of one and two rand coins;
United Kingdom; Royal Mint, making Britannia bullion coin, Sovereigns and some special issue proof coins for other clients;
United States of America; United States Mint, making the Eagle bullion coin.
Mexico; Casa de Moneda, making Centenario coin and special issue
Gold's role in the International Monetary System: Past and Present
The gold standard was a system under which nearly all countries fixed the value of their currencies in terms of a specified amount of gold, or linked their currency to that of a country which did so. At a country level, the gold standard has been credited for a long period of price stability which was supportive of economic growth. On an international level, the gold standard ushered in an era of remarkable capital flows, contributing to global trade, growth and significant global economic development. However, the strict adherence to the gold standard has also been associated with exacerbating the Great Depression, by contributing to extreme deflationary pressures in a time of significant economic decline, when expansionary monetary policies may have been more appropriate.
The gold exchange standard was also a period of relative stability and strong economic growth whereby countries tied their currencies to the US dollar, which was in turn tied to gold. Since the end of the gold exchange standard on August 15, 1971, the international monetary system has been progressing through no official international cooperative monetary system and gold has traded freely in the global markets. While gold no longer plays an official role in the international monetary system, it remains a cornerstone reserve asset accounting for 13% of total official reserves.
Furthermore, gold has been playing an increasing role among private investors, in part supported by the ease of ownership through ETFs. Private investment has also been supported by growing demand from emerging markets, in particular China and India. Gold’s lack of credit or counterparty risk, coupled with the deterioration of sovereign credit, has encouraged investors and global exchanges to increasingly use gold as a source of high quality collateral.
Source world gold council
The gold exchange standard was also a period of relative stability and strong economic growth whereby countries tied their currencies to the US dollar, which was in turn tied to gold. Since the end of the gold exchange standard on August 15, 1971, the international monetary system has been progressing through no official international cooperative monetary system and gold has traded freely in the global markets. While gold no longer plays an official role in the international monetary system, it remains a cornerstone reserve asset accounting for 13% of total official reserves.
Furthermore, gold has been playing an increasing role among private investors, in part supported by the ease of ownership through ETFs. Private investment has also been supported by growing demand from emerging markets, in particular China and India. Gold’s lack of credit or counterparty risk, coupled with the deterioration of sovereign credit, has encouraged investors and global exchanges to increasingly use gold as a source of high quality collateral.
Source world gold council
Thursday, October 13, 2011
Wednesday, October 12, 2011
China’s Pan Asia Gold Exchange: A New Playing Field for Speculators?
Posted on October 11, 2011 by China Briefing
By Vivian Ni
Oct. 11 – In an age when the assets of insolvent Western economies are becoming less reliable and international investors appreciate gold as a safe haven, the Chinese know it is time for them to play a larger role in the global gold market. The Pan Asia Gold Exchange (PAGE) – opened earlier this year allowing gold trade in China’s own local currency RMB – may make China the new epicenter of the global gold market and even trigger a bigger wave of speculative gold buying and selling.
Established on March 31 this year, the PAGE is located in Kunming, the capital city of China’s southwestern Yunnan Province (an area well-known as a major gateway to Southeast Asia). The new gold exchange – which markets itself as China’s “gold supermarket” – will allow individuals to buy physical gold or speculate in gold future contracts through an RMB account with a bank or broker. Initially, all the clients of PAGE’s two settlement banks – the Agricultural Bank of China and Yunnan’s local Fudian Bank – will be able to buy 10-ounce T+D contracts on the PAGE.
While average Chinese citizens have already gained access to purchasing and owning physical gold with the opening of the Shanghai Gold Exchange in 2002, the new exchange in Yunnan will enable people to buy gold and silver more easily at home from their computers, according to analysts.
International investors will also find access to the RMB through these gold contracts once they are allowed to purchase International Spot Contracts on the PAGE.
In addition, the PAGE aims to establish an over-the-counter gold market, where its gold price fixed at 8:00 a.m. every morning local time will be recognized as the daily opening price of the global gold market.
A recent Forbes magazine editorial written by Robert Lenzer believes the impact of the PAGE will be huge, because it will enable the RMB – instead of U.S. dollars – to become the dominant currency in one of the most important speculative commodities for the first time. Furthermore, the PAGE’s integration with global gold market operations will likely head the spot market in gold for China away from London’s Metals Exchange or the New York Mercantile Exchange and Commodity Exchange (COMEX).
The PAGE may also rise as an alternative playing field for global gold investors because of the potential changes it brings to the existing mechanism in dominance. On PAGE, a gold buyer will be able to receive a 90-day International Spot Contract and actual title to the gold he/she purchases, while currently, the spot price of gold is still greatly impacted by London’s futures market. For every purchase of paper gold, both the London Bullion Market Association (LBMA) and COMEX are supposed to only have 10 percent allocated contracts backing them, and the other 90 percent is held in unallocated accounts.
Analysts looking on the bright side believe the emergence of the PAGE will help break the LBMA members’ market monopoly and bring greater transparency to the market as gold will be priced in terms of an alternative currency.
However, Lenzer uttered his concern over effective regulation on the market. It may become more difficult for the Western gold market regulators – who often have an interest in seeing a reduced gold price – to govern China’s action. As a result, the little controlled speculative fervor may drive gold prices to a new high and investors may see greater price discrepancies between the exchanges.
Original source
By Vivian Ni
Oct. 11 – In an age when the assets of insolvent Western economies are becoming less reliable and international investors appreciate gold as a safe haven, the Chinese know it is time for them to play a larger role in the global gold market. The Pan Asia Gold Exchange (PAGE) – opened earlier this year allowing gold trade in China’s own local currency RMB – may make China the new epicenter of the global gold market and even trigger a bigger wave of speculative gold buying and selling.
Established on March 31 this year, the PAGE is located in Kunming, the capital city of China’s southwestern Yunnan Province (an area well-known as a major gateway to Southeast Asia). The new gold exchange – which markets itself as China’s “gold supermarket” – will allow individuals to buy physical gold or speculate in gold future contracts through an RMB account with a bank or broker. Initially, all the clients of PAGE’s two settlement banks – the Agricultural Bank of China and Yunnan’s local Fudian Bank – will be able to buy 10-ounce T+D contracts on the PAGE.
While average Chinese citizens have already gained access to purchasing and owning physical gold with the opening of the Shanghai Gold Exchange in 2002, the new exchange in Yunnan will enable people to buy gold and silver more easily at home from their computers, according to analysts.
International investors will also find access to the RMB through these gold contracts once they are allowed to purchase International Spot Contracts on the PAGE.
In addition, the PAGE aims to establish an over-the-counter gold market, where its gold price fixed at 8:00 a.m. every morning local time will be recognized as the daily opening price of the global gold market.
A recent Forbes magazine editorial written by Robert Lenzer believes the impact of the PAGE will be huge, because it will enable the RMB – instead of U.S. dollars – to become the dominant currency in one of the most important speculative commodities for the first time. Furthermore, the PAGE’s integration with global gold market operations will likely head the spot market in gold for China away from London’s Metals Exchange or the New York Mercantile Exchange and Commodity Exchange (COMEX).
The PAGE may also rise as an alternative playing field for global gold investors because of the potential changes it brings to the existing mechanism in dominance. On PAGE, a gold buyer will be able to receive a 90-day International Spot Contract and actual title to the gold he/she purchases, while currently, the spot price of gold is still greatly impacted by London’s futures market. For every purchase of paper gold, both the London Bullion Market Association (LBMA) and COMEX are supposed to only have 10 percent allocated contracts backing them, and the other 90 percent is held in unallocated accounts.
Analysts looking on the bright side believe the emergence of the PAGE will help break the LBMA members’ market monopoly and bring greater transparency to the market as gold will be priced in terms of an alternative currency.
However, Lenzer uttered his concern over effective regulation on the market. It may become more difficult for the Western gold market regulators – who often have an interest in seeing a reduced gold price – to govern China’s action. As a result, the little controlled speculative fervor may drive gold prices to a new high and investors may see greater price discrepancies between the exchanges.
Original source
China installs gold vending machine, plans 2,000 more
Author: Shivom Seth
Posted: Monday , 10 Oct 2011
MUMBAI -
China has joined the United States, Germany, Italy and the United Arab Emirates, in hosting an ATM machine that dispenses bullion and gold coins. In Beijing's 800-year old Wangfujing shopping district, shoppers can use bank cards and cash to buy certified gold bars and coins.
China's first ATM dispensing gold bars and coins was switched on over the weekend of September 25, and then swiftly switched back off again. The equipment had to be shut down the same day because it was not producing receipts due to a small technical glitch, said an industry observer.
The German-imported gold vending machine was then officially installed during the Chinese National Day holidays, which fell in the first week of October.
Despite the initial hiccups, there are plans to roll out 2,000 more of the ATMs nationwide. The machines are operated jointly by Beijing Agricultural Commercial Bank and a gold trading German firm. Plans call for installing more of them in secure locations and in private clubs at banks and at landmark buildings in large cities across the Asian country.
Gold vending machines are already used in some countries. The Chinese government is keen to encourage sales of gold in a country which has seen gold demand soaring 27% last year.
At the ATM, the maximum limit for each withdrawal has been set at 2.5 kilo or one million yuan ($157) worth of gold.
China is the second largest consumer of gold in the world. For some time now, the government has been actively discouraging real estate investment and speculation to cool down property prices.
The gold ATMs retrieve pricing every 10 minutes, and in exchange for cash, debit or credit cards, provides gold coins, wafers or bars in high-end boxes 24 hours a day, 365 days of the year.
A report by the World Gold Council in May showed that China had edged out India as the largest gold consumer in the first quarter of this year, snapping up 90.9 tonnes of the metal. It also said the demand for jewellery in China soared 21% in the same period.
Albert Cheng, managing director of the Far East at the World Gold Council had reportedly said in March 2010, that the Council had predicted gold demand in China to double by 2020, ``We now believe this doubling may in fact be achieved sooner. China's appetite for gold has increased rapidly over the past few years,'' he said
Gongmei Gold Trading, the company that installed the ATM, said it can hold up to 200 kilograms of gold at once, in varying denominations.
In May 2010, Germany-based firm Gold said that it would churn out 50 gold machines a month. It launched its first ATM in Abu Dhabi's Emirates Palace Hotel and opened a second one in Germany.
By next month, the Chinese gold-vending machines are expected to include a gold buy-back facility.
Original source
Posted: Monday , 10 Oct 2011
MUMBAI -
China has joined the United States, Germany, Italy and the United Arab Emirates, in hosting an ATM machine that dispenses bullion and gold coins. In Beijing's 800-year old Wangfujing shopping district, shoppers can use bank cards and cash to buy certified gold bars and coins.
China's first ATM dispensing gold bars and coins was switched on over the weekend of September 25, and then swiftly switched back off again. The equipment had to be shut down the same day because it was not producing receipts due to a small technical glitch, said an industry observer.
The German-imported gold vending machine was then officially installed during the Chinese National Day holidays, which fell in the first week of October.
Despite the initial hiccups, there are plans to roll out 2,000 more of the ATMs nationwide. The machines are operated jointly by Beijing Agricultural Commercial Bank and a gold trading German firm. Plans call for installing more of them in secure locations and in private clubs at banks and at landmark buildings in large cities across the Asian country.
Gold vending machines are already used in some countries. The Chinese government is keen to encourage sales of gold in a country which has seen gold demand soaring 27% last year.
At the ATM, the maximum limit for each withdrawal has been set at 2.5 kilo or one million yuan ($157) worth of gold.
China is the second largest consumer of gold in the world. For some time now, the government has been actively discouraging real estate investment and speculation to cool down property prices.
The gold ATMs retrieve pricing every 10 minutes, and in exchange for cash, debit or credit cards, provides gold coins, wafers or bars in high-end boxes 24 hours a day, 365 days of the year.
A report by the World Gold Council in May showed that China had edged out India as the largest gold consumer in the first quarter of this year, snapping up 90.9 tonnes of the metal. It also said the demand for jewellery in China soared 21% in the same period.
Albert Cheng, managing director of the Far East at the World Gold Council had reportedly said in March 2010, that the Council had predicted gold demand in China to double by 2020, ``We now believe this doubling may in fact be achieved sooner. China's appetite for gold has increased rapidly over the past few years,'' he said
Gongmei Gold Trading, the company that installed the ATM, said it can hold up to 200 kilograms of gold at once, in varying denominations.
In May 2010, Germany-based firm Gold said that it would churn out 50 gold machines a month. It launched its first ATM in Abu Dhabi's Emirates Palace Hotel and opened a second one in Germany.
By next month, the Chinese gold-vending machines are expected to include a gold buy-back facility.
Original source
Tuesday, October 11, 2011
Pass the China Currency Bill
By Peter Morici
The China Currency Bill is the most significant jobs bill the US Congress could pass. It enjoys the bi-partisan support of nearly 80 Republican and Democratic senators, yet President Barack Obama and House Speaker John Boehner oppose it, illustrating both are out of touch with the problems besetting the American economy.
The nearly US$600 billion trade deficit is destroying more American jobs than the mortgage crisis, too much business regulation, and high healthcare costs combined.
Americans haven't forgotten how to make things or compete. Unlike what President Obama would have us believe, Americans are not undereducated dolts, unenlightened in the ways of global competition. Rather, through a failure to act on issues.
Simply, the US economy suffers from too little demand for what Americans make. Americans are spending again, but since the first quarter of 2009, the trade deficit is up 55%. In the second quarter, it was nearly $600 billion or 4% of gross domestic product (GDP) - thanks almost entirely to surging imports of subsidized imports from China, barriers to US exports into the Middle Kingdom and higher oil prices.
Every dollar that goes abroad to purchase Chinese goods or oil that does not return to purchase exports is lost purchasing power that could be creating American jobs. Halving the nearly $600 billion annual trade deficit would create at least 5 million jobs.
To keep Chinese products artificially inexpensive on US store shelves, Beijing undervalues the yuan by 40% - simply, it prints yuan and purchases about US$450 billion annually in currency markets to keep its currency and exports cheap. In the bargain, it uses some of those dollars to subsidize oil imports and drive up gasoline prices in the United States.
In addition, China provides domestic industries with more than 200 export subsidies and blocks competitive imports of US cars, alternative energy products and just about anything else it chooses to promote. Currency manipulation, subsidies and insidious barriers to the sales of foreign products ranging from cars to solar panels violate the letter and spirit of China's World Trade Organization obligations to promote freer trade and provide open access to foreign goods in its markets.
All President Obama does is complain, Speaker Boehner prefers to do even less, and both, with feet planted firmly in the past, cling each to ideological prescriptions that do little to address these problems.
President Obama remains faithful to Food Co-Op Capitalism - more government spending, income redistribution, overregulation, industrial policies, and free trade agreements that don't reduce the trade deficit and destroy jobs. Meanwhile Speaker Boehner adheres to Knickers Era Capitalism - indiscriminate cuts in taxes, spending and regulation. Both have failed America - the former since 2008, when the Democrats took control of the House and bloated the bureaucracy and deficit, and the latter during the first six years of the Bush presidency.
The China Currency Bill would permit US firms and workers harmed by China's 40% undervalued currency to obtain relief through offsetting duties until China stops intervening in currency markets. That should jog China into finally compromising on the issue. If not, it would move some jobs back to the United States that should not have left in the first place. The senate was reportedly set on Tuesday to pass the bill.
American companies like GE and Caterpillar which have outsourced American jobs and corporate functions to China and are now clients of Beijing's protectionism have convinced President Obama the China Currency Bill is protectionist and would start a trade war.
What China does is protectionist and America is already in a trade war - China is throwing rocks and President Obama is throwing words. China is bullying America, President Obama refuses to stand up to the bully, and Speaker Boehner is just fine with that.
Growing up in a tough blue-collar neighborhood and the smallest boy at school, I learned that whining about bullies doesn't work. Sometimes you just need to get a big stick and strike back. After a few hard blows, even big bullies can be brought to reason.
The world is a messy place and full of nasty people. Americans must address it as they find it, not as Obama's friends in neatly pressed Brooks Brothers suits tell us it should be.
Peter Morici is a professor at the Smith School of Business, University of Maryland School, and former Chief Economist at the US International Trade Commission.
(Copyright 2011 Peter Morici)
Original source
The China Currency Bill is the most significant jobs bill the US Congress could pass. It enjoys the bi-partisan support of nearly 80 Republican and Democratic senators, yet President Barack Obama and House Speaker John Boehner oppose it, illustrating both are out of touch with the problems besetting the American economy.
The nearly US$600 billion trade deficit is destroying more American jobs than the mortgage crisis, too much business regulation, and high healthcare costs combined.
Americans haven't forgotten how to make things or compete. Unlike what President Obama would have us believe, Americans are not undereducated dolts, unenlightened in the ways of global competition. Rather, through a failure to act on issues.
Simply, the US economy suffers from too little demand for what Americans make. Americans are spending again, but since the first quarter of 2009, the trade deficit is up 55%. In the second quarter, it was nearly $600 billion or 4% of gross domestic product (GDP) - thanks almost entirely to surging imports of subsidized imports from China, barriers to US exports into the Middle Kingdom and higher oil prices.
Every dollar that goes abroad to purchase Chinese goods or oil that does not return to purchase exports is lost purchasing power that could be creating American jobs. Halving the nearly $600 billion annual trade deficit would create at least 5 million jobs.
To keep Chinese products artificially inexpensive on US store shelves, Beijing undervalues the yuan by 40% - simply, it prints yuan and purchases about US$450 billion annually in currency markets to keep its currency and exports cheap. In the bargain, it uses some of those dollars to subsidize oil imports and drive up gasoline prices in the United States.
In addition, China provides domestic industries with more than 200 export subsidies and blocks competitive imports of US cars, alternative energy products and just about anything else it chooses to promote. Currency manipulation, subsidies and insidious barriers to the sales of foreign products ranging from cars to solar panels violate the letter and spirit of China's World Trade Organization obligations to promote freer trade and provide open access to foreign goods in its markets.
All President Obama does is complain, Speaker Boehner prefers to do even less, and both, with feet planted firmly in the past, cling each to ideological prescriptions that do little to address these problems.
President Obama remains faithful to Food Co-Op Capitalism - more government spending, income redistribution, overregulation, industrial policies, and free trade agreements that don't reduce the trade deficit and destroy jobs. Meanwhile Speaker Boehner adheres to Knickers Era Capitalism - indiscriminate cuts in taxes, spending and regulation. Both have failed America - the former since 2008, when the Democrats took control of the House and bloated the bureaucracy and deficit, and the latter during the first six years of the Bush presidency.
The China Currency Bill would permit US firms and workers harmed by China's 40% undervalued currency to obtain relief through offsetting duties until China stops intervening in currency markets. That should jog China into finally compromising on the issue. If not, it would move some jobs back to the United States that should not have left in the first place. The senate was reportedly set on Tuesday to pass the bill.
American companies like GE and Caterpillar which have outsourced American jobs and corporate functions to China and are now clients of Beijing's protectionism have convinced President Obama the China Currency Bill is protectionist and would start a trade war.
What China does is protectionist and America is already in a trade war - China is throwing rocks and President Obama is throwing words. China is bullying America, President Obama refuses to stand up to the bully, and Speaker Boehner is just fine with that.
Growing up in a tough blue-collar neighborhood and the smallest boy at school, I learned that whining about bullies doesn't work. Sometimes you just need to get a big stick and strike back. After a few hard blows, even big bullies can be brought to reason.
The world is a messy place and full of nasty people. Americans must address it as they find it, not as Obama's friends in neatly pressed Brooks Brothers suits tell us it should be.
Peter Morici is a professor at the Smith School of Business, University of Maryland School, and former Chief Economist at the US International Trade Commission.
(Copyright 2011 Peter Morici)
Original source
Saturday, October 8, 2011
Junk silver coins in the United States and Canada
Today, the circulated coins inside the two countries contain copper and nickel, which are of far lesser intrinsic value. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Junk Silver Coins in the United States and in Canada The common junk U.S. silver coins are: • 1916-1945 Mercury Dime • 1932-1964 Washington Quarter • 1942-1945 Silver War Nickel • 1946-1964 Roosevelt Dime • 1916-1947 Liberty Half Dollar • 1948-1963 Franklin Half Dollar • 1964 Kennedy Half Dollar • 1965-1970 Kennedy Half Dollar • 1878-1921 Morgan Dollar • 1921-1935 Peace Dollar • 1971-1976 Eisenhower Dollar In Canada, most junk silver bullions are those minted before 1967 such as: • 1920-1967 Dime • 1920-1967 Quarter • 1920-1967 Half Dollar • 1935-1967 Dollar The Scarcity of Silver Coins It remains a fact that even though junk silver coins are in circulation, majority of the American population have not seen or beheld any of these silver dimes at all. Junk silver dollars have always been rare since the curtailing of its minting in 1965. The scarcity of 90% junk silver can be explained through the Gresham Law. It states that when two coins of the same face value but different intrinsic qualities are circulated together, the coin made out of precious metal is more likely to be hoarded. Thus, the one with a lesser value will remain in circulation for the longest of time. As it happened in American history when the 1965 Coinage Act was passed, the junk coins were instantly swarmed by the fortunate few. The less valuable cupro-nickel coins, although of equal face value with their junk silver counterparts, were the ones left for dispersion. To counteract the hoarding of the 90% silver bullions, the Secretary of the US Treasury resorted to making clad coins. The latter are coins made by sandwiching a copper core with two metals. Clad coins were not dated earlier than 1965. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Junk Silver Bags In buying junk silver, these coins are commonly sold collectively in cloth pouches otherwise known as silver bags. Inside the bag is an assortment of silver quarters, dimes, and half-dollars. Most U.S. junk silver bags have a $1,000 face value. Others are sold in $500 or $250. Whether it’s a dime or a quarter on the vintage silver’s face value, its metal content remains the same: every piece of junk silver coin will weight 90% silver. Hence, a bag of sterling silver will weigh about 715 ounces of silver regardless of the par value of coins inside. Determining Junk Silver Prices If you have a junk silver piece at hand, here’s a quick guide to determine your junk silver coin’s price. Take note that all silver values are pegged at $10 per ounce of silver. So to determine the actual value, the silver weight is multiplied by the current spot price of silver.
So when the price of silver goes up by ten cents, a bag of 90% junk silver coins will rise by at least $70. Investing in Junk Silver Coins Would you rather choose a 100-oz silver bar or a bag of circulated 90% silver? Either of the two will garner the same premiums. But loose silver coins are much preferred by seasoned investors because they can be readily disposed in allotments or in bags whenever the need arises. A junk silver coin has a legal tender. Survivalists, who are ever on the look-out for sudden economic collapse, think it is wiser to devote their finances on silver bullions as well. In such catastrophes, the fiat currency (wherein money used as legal tender is not made of precious metals) will be deemed worthless. Silver, as one of the known precious metals since time immemorial, can then be used as money in exchange for goods and services. |
Friday, October 7, 2011
The Chinese Mean To Control The Global Gold Market
Robert Lenzner, Forbes Staff
Get ready for the Pan Asian Gold Exchange, scheduled to open in June, 2012 in Kunming City, Yunman Province– the gateway to all of Southeast Asia. This is serious, as the Pan Asian Gold Exchange is a part of China’s five year plan– which means it is part of China’s strategy for dominance in global financial markets and the global economy.
Pan Asian will allow Chinese to speculate in gold futures contracts or buy physical gold through an account with a bank or broker. All 320 million customers of the giant Agricultural Bank of China will. simply be able to use their Renminbi, the Chinese currency, from their bank accounts to trade gold. Sounds bloody dangerous doesn’t it.
It means the spot market in gold could be headed for China– and away from London’s Metals Exchange or the Comex in New York. I’d like to know who is going to oversee and regulate all this action. For example, when the Comex raises margin requirements to dampen speculative fervor– will China bew governed by that? I doubt it very much.
In June you’ll be able to buy spot gold or futures contracts in China. It also means that the Chinese currency- not dollars– will for the first time become the ruling currency used in one of the major speculative commodities of our age. All eyes will be on the influence of the gold trade in China rather than New York, London, Switzerland or South Africa.
Another reason for registering the reality of gold as a trading vehicle, an investment for households, central banks, hedge funds, endowments. Another bullish force behind the powering of gold prices higher.
No wonder George Soros has bought back some or all of the gold position he sold around $1600 an ounce.
Original source
Wednesday, October 5, 2011
America Is on Sale
Except for a handful of hedge funds and perhaps some gold coin dealers, few investors are able or willing to stand up during a recession and proclaim that they're on a hot streak.
"I hate to say it but it has been the best three years of my life," says best-selling author and financial literacy advocate Robert Kiyosaki. "I have never made so much money - America is on sale."
Borrowing the open from Charles Dickens' A Tale of Two Cities, Kiyosaki uses the phrase, "it was the best of times, it was the worst of times," to illustrate his belief that opportunity always exists, even when the typical barometers of growth and economic vitality suggest otherwise. (For the record, the line that follows is also telling: "It was the age of wisdom, it was the age of foolishness.")
This self-proclaimed "cash-flow guy" prefers investments that "throw money in my pocket every month." He's focused on real estate, oil, gold, silver, and natural gas. Given his belief that "commercial real estate is done and individual real estate is a mess," Kiyosaki says 300-800 unit apartment complexes are "the hottest part of the market."
When asked if dividend paying blue chip stocks meet his criteria for value and cash flow, the native Hawaiian says no, and refers to a cyclical prediction from a previous book that has called for a bottom in 2016. In the meantime, he has no interest in owning shares of Exxon Mobil (XOM) or BP (BP). Instead he prefers "buy private oil drilling projects, where the entrepreneur and I are good friends."
Clearly, a man of his means, who has access to and writes books with Donald Trump, will have a different array of investment choices and opportunities available to him than the average Joe. For us mortals, his advice is 3-fold: Educate yourself, be smarter, and seek cash flow.
Kiyosaki has been a gold bug since his time in Vietnam 40 years ago. "If I have cash and I can't figure a way to put it into real estate or my business, I hold it in gold and silver," he says.
For those holding out hope that Ben Bernanke and the Fed will inject more dollars into the monetary system and markets, Kiyosaki says you've got it all wrong. "The Fed just printed like $4trillion dolllars in three years," he says. "That wipes out the purchasing power of your money and your labor. So I think the Fed and the Treasury have basically ripped off the American worker."
If he's right, perhaps it's time for a policy re-branding and would suggest, "Quantitative Teasing."
Original source"
"I hate to say it but it has been the best three years of my life," says best-selling author and financial literacy advocate Robert Kiyosaki. "I have never made so much money - America is on sale."
Borrowing the open from Charles Dickens' A Tale of Two Cities, Kiyosaki uses the phrase, "it was the best of times, it was the worst of times," to illustrate his belief that opportunity always exists, even when the typical barometers of growth and economic vitality suggest otherwise. (For the record, the line that follows is also telling: "It was the age of wisdom, it was the age of foolishness.")
This self-proclaimed "cash-flow guy" prefers investments that "throw money in my pocket every month." He's focused on real estate, oil, gold, silver, and natural gas. Given his belief that "commercial real estate is done and individual real estate is a mess," Kiyosaki says 300-800 unit apartment complexes are "the hottest part of the market."
When asked if dividend paying blue chip stocks meet his criteria for value and cash flow, the native Hawaiian says no, and refers to a cyclical prediction from a previous book that has called for a bottom in 2016. In the meantime, he has no interest in owning shares of Exxon Mobil (XOM) or BP (BP). Instead he prefers "buy private oil drilling projects, where the entrepreneur and I are good friends."
Clearly, a man of his means, who has access to and writes books with Donald Trump, will have a different array of investment choices and opportunities available to him than the average Joe. For us mortals, his advice is 3-fold: Educate yourself, be smarter, and seek cash flow.
Kiyosaki has been a gold bug since his time in Vietnam 40 years ago. "If I have cash and I can't figure a way to put it into real estate or my business, I hold it in gold and silver," he says.
For those holding out hope that Ben Bernanke and the Fed will inject more dollars into the monetary system and markets, Kiyosaki says you've got it all wrong. "The Fed just printed like $4trillion dolllars in three years," he says. "That wipes out the purchasing power of your money and your labor. So I think the Fed and the Treasury have basically ripped off the American worker."
If he's right, perhaps it's time for a policy re-branding and would suggest, "Quantitative Teasing."
Original source"
Troubling Trends in Regulations Affecting Gold & Silver Investors
GoldSilver.com
OCTOBER 04, 2011
OCTOBER 04, 2011
We are extremely proud of our purchasing customer base, our beloved Insiders. With the recent volatility in gold and especially silver, only a handful of customers sold off their bullion holdings. Hundreds and hundreds have and are still taking advantage of the price pullbacks by acquiring more ounces of tangible counter-party risk-less monies.
Smart investors are not running away from this bull market. To the contrary, they are running with both hands extended dropping fiat paper promises for the exponential future of gold and silver bullion.
Understanding the financial fundamentals and sticking to the facts, this is a key piece to solving our present puzzle in acquiring true wealth.
And so continues the puzzling news, the economic situation in Europe is not going well. Greece's potential debt default threatens not only to affect the Eurozone, but the entire globe.
The U.S. debt is up to $14.5 trillion and our unfunded liabilities ($80 to $100 trillion) are not payable without extreme currency debasement:
Smart investors are not running away from this bull market. To the contrary, they are running with both hands extended dropping fiat paper promises for the exponential future of gold and silver bullion.
Understanding the financial fundamentals and sticking to the facts, this is a key piece to solving our present puzzle in acquiring true wealth.
And so continues the puzzling news, the economic situation in Europe is not going well. Greece's potential debt default threatens not only to affect the Eurozone, but the entire globe.
The U.S. debt is up to $14.5 trillion and our unfunded liabilities ($80 to $100 trillion) are not payable without extreme currency debasement:
The Federal Reserve is endlessly printing Federal Reserve Notes, fleecing the world's purchasing power day in, day out.
The U.S. unemployment picture and foreclosure rates are growing worse. Regardless of the distractions dragged forth, the truth is, things have to get worse before they get better.
Troubling Trends in Regulations Affecting Gold & Silver Investors
A well known digital bullion firm has recently decided to close its gold and silver accounts within the Netherlands. It appears the Autoriteit Financiële Markten, the Netherlands financial regulator, indicated that, in its view, this digital gold firm was "offering investment objects in the Netherlands without a licence" in breach of Section 2:55 of the Netherlands Financial Supervision Act. Rather than submit to regulatory requirements, this particular firm has decided to discontinue offering their services to customers within the Netherlands.
Approximately two months ago, the British government seized numerous assets from citizen's safe deposit boxes. Gold, silver, jewelry, art pieces and personal belongings at the following locations: Park Lane Safe Depository (in Park Street), Hampstead Safe Depository (on Finchley Road), and in Edware Safe Depository (on High Street in Edware).
There was an order which came directly from the government, under the pretext that those belongings could be "illegal", from the "black market" and/or from "drug businesses and money laundry". A total of 146 people were arrested and 30 of them received charges of pedophile, illegal arms possession and money laundry.
Austria recently announced a maximum of 15,000 euro purchases for precious metals per transaction, which is approximately 12 ounces of gold or 600 ounces of silver bullion.
France has followed Austria's steps in an even worse way. It has been reported France just modified a law where any transaction for metals higher than 450 euros (roughly $ 600.00) must be made through a bank transfer.
Tran Thanh Hai, general director of the Vietnam Gold Business Co, suggested that the central bank issue gold certificates to sell to individuals at prices below the market price. This would demotivate citizens from buying and selling gold on the market, creating risks and helping the country retain its foreign currency reserves.
Nguyen Dong Tien, State Bank deputy governor, revealed that the central bank will submit a draft of a decree, stating that the State Bank would control and intervene in the gold market if needed, preventing speculation and price manipulation. Trading in gold bars would also be restrained.
As many of you may recall, in the United States, a law was recently repealed (it would have gone into effect at the beginning of 2012) where all companies would have had to issue 1099 IRS tax forms for all transactions of $ 600.00 or more for goods and services.
Where are our liberties? How are we supposed to trust our governments, when they are actively moving to track and control our financial freedoms?
Mike Maloney writes in his book, Rich Dad's Guide to Investing in Gold and Silver, governments "should protect citizens against crimes against themselves or their property". He states that "when a government, in pursuit of good intentions, tries to rearrange the economy, legislate morality or help special interest, the costs come in inefficiency, lack of innovation, and loss of freedom".
Mike often exclaims what he wrote in his book... "Governments should be a referee, not an active player".
Mike Maloney writes in his book, Rich Dad's Guide to Investing in Gold and Silver, governments "should protect citizens against crimes against themselves or their property". He states that "when a government, in pursuit of good intentions, tries to rearrange the economy, legislate morality or help special interest, the costs come in inefficiency, lack of innovation, and loss of freedom".
Mike often exclaims what he wrote in his book... "Governments should be a referee, not an active player".
We must heed Mike's advice, "I believe it will be the perfect storm and there isn't anything we can do to stop it. Events are forming that, once fully converged, will result in quick and devastating economic destruction. If you think the government will help you, you are sorely mistaken".
The signs are out there. Every day, the more we read the news, the worse it gets.
When it comes to government regulations for gold and silver bullion investing, the trend is not our friend.
Before these ugly tendencies reach their climax, before it becomes too late, we must acquire our bullion while the window of opportunity remains.
The private banking establishments and the governments who serve them, they don't want to see us acquire gold and or silver bullion.
They are fully aware that if we take action and ownership of investment grade bullion, the stealing of our wealth becomes next to impossible.
The name of their game is control. They want to dominate our financial futures.
The signs are out there. Every day, the more we read the news, the worse it gets.
When it comes to government regulations for gold and silver bullion investing, the trend is not our friend.
Before these ugly tendencies reach their climax, before it becomes too late, we must acquire our bullion while the window of opportunity remains.
The private banking establishments and the governments who serve them, they don't want to see us acquire gold and or silver bullion.
They are fully aware that if we take action and ownership of investment grade bullion, the stealing of our wealth becomes next to impossible.
The name of their game is control. They want to dominate our financial futures.
Physical bullion is one of the only financial assets fully outside of their financial matrix. It is true wealth which cannot be frozen, debased, or defaulted upon.
We must free ourselves. We must claim control over our financial destinies. We must get our gold and silver bullion before it is too late!
Monday, October 3, 2011
Four Biggest Banks in America have Huge Leverage
3 October 2011
By Greg hunter’s USAWatchdog.com
I keep hammering away at the fact the Fed doled out $16 trillion in the wake of the credit crisis of 2008. This is an enormous sum that is greater than the all goods and services produced in the U.S. in a single year. Domestic banks and companies got the money, right along with foreign banks and companies. In effect, the Federal Reserve bailed out the world financial system. Now, we are right back to square one facing another financial meltdown with European banks and sovereign debt. If the Fed spent $16 trillion, why in the heck is this problem not fixed and why isn’t the world economy taking off like a rocket?” The simple answer is it wasn’t enough money.
The Bank of International Settlements pegs the total world over-the-counter (OTC) derivative exposure at around $600 trillion, but many experts say the real figure is more than twice that amount. No matter which figure you use, it is a gargantuan sum. OTC derivatives are an unregulated dark pool of money with no public market. These are basically debt bets between two entities on things such as credit risk, currencies, interest rates and commodities. According to the latest report from the Comptroller of the Currency, just four U.S. banks have an eye popping $235 trillion of OTC derivative leverage. (Click here for the complete Comptroller of the Currency report.) As a nation, U.S. banks have a total OTC derivative exposure of $250 trillion. So, the fact that just four U.S. banks have this much leverage and risk is astounding! The banks are listed below in order of size and approximate OTC exposure:
1.) JP MORGAN CHASE BANK NA OH
$78.1 trillion OTC derivatives
2.) CITIBANK NATIONAL ASSN
$56.1 trillion OTC derivatives
3.) BANK OF AMERICA NA NC
$53.15 trillion OTC derivatives
4.) GOLDMAN SACHS BANK USA NY
$47.7 trillion OTC derivatives
Considering that the total assets of these four banks are a little more than $5 trillion, I see a frightening amount of risk with a total derivative exposure of $235 trillion! This is nearly 50 to 1 leverage. On top of that, assets such as real estate or mortgage-backed securities can be held on the books at whatever value the banks think they can sell them for in the future. I call this government sanctioned accounting fraud, or mark to fantasy accounting. Who knows what the true value of the banks “assets” really are.
I am sure the banks would say that the net exposure is really not near that great because the banks have hedged their bets. The banks will probably say, by and large, these debt bets will cancel out or back up one another. It is known in the banking world as “bilateral netting.” A recent article in Zerohedge.com explained the enormous risk by saying, “The best example of how the flaw behind bilateral netting almost destroyed the system is AIG: the insurance company was hours away from making trillions of derivative contracts worthless if it were to implode, leaving all those who had bought protection from the firm worthless, a contingency only Goldman hedged by buying protection on AIG. And while the argument can further be extended that in bankruptcy a perfectly netted bankrupt entity would make someone else whole on claims they have written, this is not true, as the bankrupt estate will pursue 100 cent recovery on its claims even under Chapter 11, while claims the estate had written end up as General Unsecured Claims which as Lehman has demonstrated will collect 20 cents on the dollar if they are lucky.”(Click here to read the complete Zerohedge.com story.)
The global economy is still in trouble. Everyone is focusing on Europe because the sovereign debt crisis there is likely to cause the European Union to break apart and kill the Euro. The Head of UniCredit global securities, Attila Szalay-Berzeviczy said recently, “The euro is beyond rescue . . . . “The only remaining question is how many days the hopeless rearguard action of European governments and the European Central Bank can keep up Greece’s spirits . . . . A Greek default will trigger an immediate “magnitude 10” earthquake across Europe.” (Click here for more on that story.) If the EU goes under, do not expect all the highly leveraged U.S. banks to walk away unscathed. They will need another bailout to stay afloat.
You must remember the U.S. still is at the epicenter of the ongoing credit crisis. At the moment, America looks like it is in better shape than Europe, but that will not last. According to the latest report from John Williams of Shadowstats.com, “The root source of current global systemic instabilities largely has been the financially-dominant United States, and it is against the U.S. dollar that the global markets ultimately should turn, massively. The Fed and the U.S. Treasury likely will do whatever has to be done to prevent a euro-area crisis from triggering a systemic collapse in the United States. Accordingly, it is not from a euro-related crisis, but rather from within the U.S. financial system and financial-authority actions that an eventual U.S. systemic failure likely will be triggered, seen initially in a rapidly accelerating pace of domestic inflation—ultimately hyperinflation.”
Sure, the dollar may gain in value for a while in absence of the Euro as a competing currency, but, ultimately, the dollar too will crash, right along with a few very big banks.
Original source:
http://usawatchdog.com/four-biggest-banks-in-america-have-huge-leverage/
By Greg hunter’s USAWatchdog.com
I keep hammering away at the fact the Fed doled out $16 trillion in the wake of the credit crisis of 2008. This is an enormous sum that is greater than the all goods and services produced in the U.S. in a single year. Domestic banks and companies got the money, right along with foreign banks and companies. In effect, the Federal Reserve bailed out the world financial system. Now, we are right back to square one facing another financial meltdown with European banks and sovereign debt. If the Fed spent $16 trillion, why in the heck is this problem not fixed and why isn’t the world economy taking off like a rocket?” The simple answer is it wasn’t enough money.
The Bank of International Settlements pegs the total world over-the-counter (OTC) derivative exposure at around $600 trillion, but many experts say the real figure is more than twice that amount. No matter which figure you use, it is a gargantuan sum. OTC derivatives are an unregulated dark pool of money with no public market. These are basically debt bets between two entities on things such as credit risk, currencies, interest rates and commodities. According to the latest report from the Comptroller of the Currency, just four U.S. banks have an eye popping $235 trillion of OTC derivative leverage. (Click here for the complete Comptroller of the Currency report.) As a nation, U.S. banks have a total OTC derivative exposure of $250 trillion. So, the fact that just four U.S. banks have this much leverage and risk is astounding! The banks are listed below in order of size and approximate OTC exposure:
1.) JP MORGAN CHASE BANK NA OH
$78.1 trillion OTC derivatives
2.) CITIBANK NATIONAL ASSN
$56.1 trillion OTC derivatives
3.) BANK OF AMERICA NA NC
$53.15 trillion OTC derivatives
4.) GOLDMAN SACHS BANK USA NY
$47.7 trillion OTC derivatives
Considering that the total assets of these four banks are a little more than $5 trillion, I see a frightening amount of risk with a total derivative exposure of $235 trillion! This is nearly 50 to 1 leverage. On top of that, assets such as real estate or mortgage-backed securities can be held on the books at whatever value the banks think they can sell them for in the future. I call this government sanctioned accounting fraud, or mark to fantasy accounting. Who knows what the true value of the banks “assets” really are.
I am sure the banks would say that the net exposure is really not near that great because the banks have hedged their bets. The banks will probably say, by and large, these debt bets will cancel out or back up one another. It is known in the banking world as “bilateral netting.” A recent article in Zerohedge.com explained the enormous risk by saying, “The best example of how the flaw behind bilateral netting almost destroyed the system is AIG: the insurance company was hours away from making trillions of derivative contracts worthless if it were to implode, leaving all those who had bought protection from the firm worthless, a contingency only Goldman hedged by buying protection on AIG. And while the argument can further be extended that in bankruptcy a perfectly netted bankrupt entity would make someone else whole on claims they have written, this is not true, as the bankrupt estate will pursue 100 cent recovery on its claims even under Chapter 11, while claims the estate had written end up as General Unsecured Claims which as Lehman has demonstrated will collect 20 cents on the dollar if they are lucky.”(Click here to read the complete Zerohedge.com story.)
The global economy is still in trouble. Everyone is focusing on Europe because the sovereign debt crisis there is likely to cause the European Union to break apart and kill the Euro. The Head of UniCredit global securities, Attila Szalay-Berzeviczy said recently, “The euro is beyond rescue . . . . “The only remaining question is how many days the hopeless rearguard action of European governments and the European Central Bank can keep up Greece’s spirits . . . . A Greek default will trigger an immediate “magnitude 10” earthquake across Europe.” (Click here for more on that story.) If the EU goes under, do not expect all the highly leveraged U.S. banks to walk away unscathed. They will need another bailout to stay afloat.
You must remember the U.S. still is at the epicenter of the ongoing credit crisis. At the moment, America looks like it is in better shape than Europe, but that will not last. According to the latest report from John Williams of Shadowstats.com, “The root source of current global systemic instabilities largely has been the financially-dominant United States, and it is against the U.S. dollar that the global markets ultimately should turn, massively. The Fed and the U.S. Treasury likely will do whatever has to be done to prevent a euro-area crisis from triggering a systemic collapse in the United States. Accordingly, it is not from a euro-related crisis, but rather from within the U.S. financial system and financial-authority actions that an eventual U.S. systemic failure likely will be triggered, seen initially in a rapidly accelerating pace of domestic inflation—ultimately hyperinflation.”
Sure, the dollar may gain in value for a while in absence of the Euro as a competing currency, but, ultimately, the dollar too will crash, right along with a few very big banks.
Original source:
http://usawatchdog.com/four-biggest-banks-in-america-have-huge-leverage/
Mainstream Media Spins Real Estate Recovery
By Greg Hunter’s USAWatchdog.com
Just about everywhere you turned yesterday, the mainstream media (MSM) was talking up the good news in the latest Case-Shiller Home Price Index report. For example, the online version of USA Today had a headline that read “Spring buying boosts home prices, market still sluggish.” The first line of the story said, “Prices rose 0.9% in July over June, marking the fourth-consecutive month of increases for the Standard & Poor’s Case-Shiller index released Tuesday.” But, buried in the same story was this little piece of information, “When adjusted for seasonal factors, home prices were essentially flat in July over June, S&P’s data show. “The housing market is still bottoming and has not turned around,” says David Blitzer, chairman of the index committee at S&P. July home prices were down 4.1% year over year, according to S&P’s index of 20 leading cities. Minneapolis and Phoenix led the declines, with prices in those areas down about 9% year-over-year.” (Click here for the complete USA Today article.)
What a spin job! “Prices were essentially flat,” and “July home prices were down 4.1% year over year.” Shouldn’t the headline have read something like “Home Prices Decline year over year– Flat for July”? Why does the MSM try to spin good news out of a rotten situation? Why do they think it is their duty to make a story look better than reality? I was in the MSM for most of my career, and I know what its duty should be. Give it to the viewer or reader straight. There is not a single inaccuracy in the USA Today story, but the spin and omissions are stupefying. Would you like an example of what I am talking about? Sure you would.
USA Today and many other news outlets such as CNBC and Fox were touting a little talking point from the report that said, “. . . 17 of 20 cities in the Case-Shiller index showed unadjusted increases in July over June. . .” This would make you think Wow! We must have a turnaround in real estate going on. Look at the actual chart from the Case-Shiller report, and focus on the last row of numbers on the right under the heading 1-Year Change (%):
July 2011 July/June June/May
July 2011 July/June June/May Metropolitan Area Level Change (%) Change (%) 1-Year Change (%)
Atlanta 104.55 0.2% 1.5% -5.0%
Boston 155.76 0.8% 2.4% -1.9%
Charlotte 112.47 0.1% 1.9% -3.9%
Chicago 117.78 1.9% 3.2% -6.6%
Cleveland 101.5 3 0.8% 1.5% -5.4%
Dallas 116.96 0.9% 1.4% -3.2%
Denver 125.9 7 0.0% 1.6% -2.1%
Detroit 72.04 3.8% 5.8% 1.2%
Las Vegas 95.48 -0.2% 0.1% -5.4%
Los Angeles 170.05 0.2% 0.3% -3.5%
Miami 141.15 1.2% 0.6% -4.6%
Minneapolis 115.25 2.6% 3.5% -9.1%
New York 168.51 1.1% 0.9% -3.7%
Phoenix 100.54 -0.1% 0.3% -8.8%
Portland 135.80 1.0% 0.0% -8.4%
San Diego 155.22 0.1% 0.2% -5.9%
San Francisco 135.28 0.3% 0.4% -5.6%
Seattle 137.57 0.1% 0.7% -6.4%
Tampa 129.61 0.8% 1.2% -6.2%
Washington 187.79 2.4% 2.2% 0.3%
Composite-10 156.23 0.9% 1.1% -3.7%
Composite -20 142.77 0.9% 1.2% -4.1%
Source: S&P Indices and Fiserv (Data through July 2011) (Click here for the complete Case-Shiller Report.)
The talking point should have been, year over year, 18 out of 20 cities had price declines! The two cities that had price increases, Detroit and Washington, were only up 1.2% and .3%!!! Who cares about monthly numbers? It is the year over year numbers that matter most!!!!! This report was spun to make a very bad market look like it was improving. It is not improving! It is an unfolding disaster, and that is a statistical fact straight from the report!!
Real estate attorney Adam Leitman Bailey dropped a real stink bomb on CNBC yesterday when he was talking about the enormous backlog of foreclosures. He said, “That’s going to take prices down to a really low level . . . I see this as a huge problem lasting at least 5 years.” Mr. Baily went on to say, “I think we’re going to have to understand that we may not have appreciation on equity in their homes for the next 30 years. And it’s really a big statement, and I know that, but so many people are underwater that they may not be able to recover unless they have cash.” One of the cheerleading talking heads on CNBC closed the interview by saying, “Depressingly, thank you very much.” Why is it “depressing” to know the truth?
Mr. Leitman said the foreclosure crisis will be around for “at least 5 years.” To me, that puts the bottom at around 2016. That is the same real estate bottom date an expert predicted in a story I did in July. The post was titled “The Only Thing You Can Count On.” (Click here to read it.)
Besides foreclosures, I think there will be another big drag on real estate– interest rates. Right now, the Fed is suppressing interest rates. The latest Fed move (the so-called “twist”) has forced interest rates on mortgages even lower. Right now, a home buyer can get a 30-year mortgage for around 4% and maybe less. When the suppression game ends, real estate prices will take another cliff dive. What do you think will happen to home prices if mortgage rates go to 8% for a 30 year loan? Prices will tumble or, at the very least, stagnate for years. The real estate market is not coming out of the tank anytime soon– no matter how the MSM spins it.
Original source :
http://usawatchdog.com/mainstream-media-spins-real-estate-recovery/#more-5873
Just about everywhere you turned yesterday, the mainstream media (MSM) was talking up the good news in the latest Case-Shiller Home Price Index report. For example, the online version of USA Today had a headline that read “Spring buying boosts home prices, market still sluggish.” The first line of the story said, “Prices rose 0.9% in July over June, marking the fourth-consecutive month of increases for the Standard & Poor’s Case-Shiller index released Tuesday.” But, buried in the same story was this little piece of information, “When adjusted for seasonal factors, home prices were essentially flat in July over June, S&P’s data show. “The housing market is still bottoming and has not turned around,” says David Blitzer, chairman of the index committee at S&P. July home prices were down 4.1% year over year, according to S&P’s index of 20 leading cities. Minneapolis and Phoenix led the declines, with prices in those areas down about 9% year-over-year.” (Click here for the complete USA Today article.)
What a spin job! “Prices were essentially flat,” and “July home prices were down 4.1% year over year.” Shouldn’t the headline have read something like “Home Prices Decline year over year– Flat for July”? Why does the MSM try to spin good news out of a rotten situation? Why do they think it is their duty to make a story look better than reality? I was in the MSM for most of my career, and I know what its duty should be. Give it to the viewer or reader straight. There is not a single inaccuracy in the USA Today story, but the spin and omissions are stupefying. Would you like an example of what I am talking about? Sure you would.
USA Today and many other news outlets such as CNBC and Fox were touting a little talking point from the report that said, “. . . 17 of 20 cities in the Case-Shiller index showed unadjusted increases in July over June. . .” This would make you think Wow! We must have a turnaround in real estate going on. Look at the actual chart from the Case-Shiller report, and focus on the last row of numbers on the right under the heading 1-Year Change (%):
July 2011 July/June June/May
July 2011 July/June June/May Metropolitan Area Level Change (%) Change (%) 1-Year Change (%)
Atlanta 104.55 0.2% 1.5% -5.0%
Boston 155.76 0.8% 2.4% -1.9%
Charlotte 112.47 0.1% 1.9% -3.9%
Chicago 117.78 1.9% 3.2% -6.6%
Cleveland 101.5 3 0.8% 1.5% -5.4%
Dallas 116.96 0.9% 1.4% -3.2%
Denver 125.9 7 0.0% 1.6% -2.1%
Detroit 72.04 3.8% 5.8% 1.2%
Las Vegas 95.48 -0.2% 0.1% -5.4%
Los Angeles 170.05 0.2% 0.3% -3.5%
Miami 141.15 1.2% 0.6% -4.6%
Minneapolis 115.25 2.6% 3.5% -9.1%
New York 168.51 1.1% 0.9% -3.7%
Phoenix 100.54 -0.1% 0.3% -8.8%
Portland 135.80 1.0% 0.0% -8.4%
San Diego 155.22 0.1% 0.2% -5.9%
San Francisco 135.28 0.3% 0.4% -5.6%
Seattle 137.57 0.1% 0.7% -6.4%
Tampa 129.61 0.8% 1.2% -6.2%
Washington 187.79 2.4% 2.2% 0.3%
Composite-10 156.23 0.9% 1.1% -3.7%
Composite -20 142.77 0.9% 1.2% -4.1%
Source: S&P Indices and Fiserv (Data through July 2011) (Click here for the complete Case-Shiller Report.)
The talking point should have been, year over year, 18 out of 20 cities had price declines! The two cities that had price increases, Detroit and Washington, were only up 1.2% and .3%!!! Who cares about monthly numbers? It is the year over year numbers that matter most!!!!! This report was spun to make a very bad market look like it was improving. It is not improving! It is an unfolding disaster, and that is a statistical fact straight from the report!!
Real estate attorney Adam Leitman Bailey dropped a real stink bomb on CNBC yesterday when he was talking about the enormous backlog of foreclosures. He said, “That’s going to take prices down to a really low level . . . I see this as a huge problem lasting at least 5 years.” Mr. Baily went on to say, “I think we’re going to have to understand that we may not have appreciation on equity in their homes for the next 30 years. And it’s really a big statement, and I know that, but so many people are underwater that they may not be able to recover unless they have cash.” One of the cheerleading talking heads on CNBC closed the interview by saying, “Depressingly, thank you very much.” Why is it “depressing” to know the truth?
Mr. Leitman said the foreclosure crisis will be around for “at least 5 years.” To me, that puts the bottom at around 2016. That is the same real estate bottom date an expert predicted in a story I did in July. The post was titled “The Only Thing You Can Count On.” (Click here to read it.)
Besides foreclosures, I think there will be another big drag on real estate– interest rates. Right now, the Fed is suppressing interest rates. The latest Fed move (the so-called “twist”) has forced interest rates on mortgages even lower. Right now, a home buyer can get a 30-year mortgage for around 4% and maybe less. When the suppression game ends, real estate prices will take another cliff dive. What do you think will happen to home prices if mortgage rates go to 8% for a 30 year loan? Prices will tumble or, at the very least, stagnate for years. The real estate market is not coming out of the tank anytime soon– no matter how the MSM spins it.
Original source :
http://usawatchdog.com/mainstream-media-spins-real-estate-recovery/#more-5873
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