Tag Archive: Federal Reserve

Feb 12

Federal Reserve & World Banks Bankrupt and Being Foreclosed On!

 Federal Reserve & World Banks Bankrupt and Being Foreclosed On!

The news has been broke, the world banks have been legally and officially  foreclosed on. Yes, reread what you have just read, the world banks have been legally foreclosed on. The Federal Reserve, The Hague, The World Bank,The United Nations, The IMF, the BIS ( Bank of International Settlements), and many others are included.

Now this news hasn’t hit mainstream media, for obvious reasons. Mass hysteria, media agreements with governments, and economic implications.  A group called “The One People’s Public Trust” released an “announcement”, a document stating they had a person on the inside gathering information for them. There is a passage that reads, ” The people, all people equally on earth have an individual, duly verified sum  certain of 5 billion, in lawful money of the United States of America gold and silver. Over 3 quintillion, 500 quadrillion, (which, by the way is a 3 and a 5 followed by 17 zeros) just and duly verified equity debt against the debtors. There is an additionally duly verified sum of 5 billion in lawful money of the United States of America, gold and silver, for each of those people damaged by the actions and systems of the debtors, over 3 quadrillion lawful money of the United States of America, gold and silver, in duly verified debt of damages against the debtors.”

Read Full Article Here: http://guardianlv.com/2013/01/in-the-money-federal-reserve-world-banks-foreclosed-on/

Dec 19

U.S. Secret Service Bans Sale of Silver and Gold Liberty Dollars on Ebay, Identified as Domestic Terrorism

In early 2011 Bernad Von Nothaus was convicted by the US government and identified as a domestic terrorist by Federal prosecutors for minting his own silver and gold coinage, and then offering those coins for sale to clients. He dubbed the  coins “Liberty Dollars” and by doing so brought upon himself the ire of the U.S. Secret Service, Federal Reserve and a host of other government agencies.

libertydollar U.S. Secret Service Bans Sale of Silver and Gold Liberty Dollars on Ebay, Identified as Domestic Terrorism

According to the government, Von Nothaus was a counterfeiter, though he made no attempts to actually counterfeit U.S. currency, but rather, provide another mechanism of exchange through the use of precious metals.

After Von Nothaus’ conviction, the Secret Service warned they would be confiscating all Liberty Dollar coins manufactured by Nothaus’ company, NorFed.


 U.S. Secret Service Bans Sale of Silver and Gold Liberty Dollars on Ebay, Identified as Domestic Terrorism

Since the shutdown of VonNothaus’ operation, many of the coins have been offered for sale or trade on mega-auction site Ebay, and this week the Secret Service took action. They contacted Ebay, which in turn advised sellers of the coins on their site that they could no longer engage in the trade of silver coins with the Norfed Liberty Dollar hallmark:

The United States Secret Service has requested the removal of all Norfed Liberty dollars on the eBay site as counterfeits. … Please do not relist this item(s). We appreciate that you chose to list this coin on our site and understand there was no ill intent on your part. Your listing fees have been credited to your account.

There is nothing special about the Liberty Dollar coins other than the fact that they are pure silver; and, of course, that they actually have intrinsic value as compared to general circulation U.S. legal tender which is, by most accounts, essentially worthless in terms of metal value.

The government disagrees with this argument, and in a press release issued by the US Department of Justice, said that the trade of such coins amounts to nothing short of terrorism because it poses a direct threat to the stability of the United States:

Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism, U.S. Attorney Tompkins said in announcing the verdict. While these forms of anti-government activities do not involve violence, they are every bit as insidious and represent a clear and present danger to the economic stability of this country, she added. We are determined to meet these threats through infiltration, disruption, and dismantling of organizations which seek to challenge the legitimacy of our democratic form of government.

The Secret Service has gotten involved in order to ensure buyers don’t get confused by thinking they are acquiring legal U.S. tender. Apparently they believe that someone who buys a silver coin for $35 may, in a state of confusion, then attempt to exchange it for a $1 soda pop in the open market.

Today they are targeting the Liberty Dollar because it “represents a clear and present danger to the economic stability” of the United States. It wouldn’t be that far a stretch of the imagination to suggest the government could make the same argument for any mechanism of exchange or store of value, especially those which contain gold and silver.

They confiscated gold in the 1930′s for much the same reasons. They may very well do it again, but this time you may be a terrorist if you have silver or gold coins at home when they come looking.

Original Article Here: http://www.shtfplan.com/precious-metals/u-s-secret-service-bans-sale-of-silver-and-gold-liberty-dollars-on-ebay_12172012

Nov 05

Quantitative Easing & What It Means To You: QE1 + QE2 + QE3 = American Bankrupt Future

The Fed announced Sept. 13, 2012, a third round of QE (I.e. QE3) in which it’s making open-ended purchases of $40 billion of mortgage debt a month as it seeks to boost economic growth and reduce unemployment. Policy makers said they will keep pumping money into the economy until there was “ongoing, sustained improvement” in the labor market. 

Federal Reserve Chairman Ben Bernanke in Jackson Hole, Wyoming, where he affirmed that the Fed would be prepared to act if the US economy remained in the doldrums

That doesn’t mean that further intervention will be effective in stimulating growth. As Chairman Bernanke said in Jackson Hole:

“Monetary policy cannot achieve by itself what a broader and more balanced set of economic policies might achieve; in particular, it cannot neutralize the fiscal and financial risks that the country faces.”

The Federal Reserve announced on Nov. 3, 2010 that they had decided to pump another $600 BILLION into the banking system, at a rate of $75 billion per month, for the next eight months. The economic term for this is “quantitative easing.” In plain English, it’s simply “printing money.”

Fed officials led by Chairman Ben S. Bernanke implemented $2.3 trillion in two rounds of bond purchases, known as quantitative easing, since 2008 to boost economic growth.

The Fed is going to create money out of thin air and then use it to buy government and/or corporate bonds. Historically, governments have used quantitative easing when interest rates are as low as they can go and the government wants to do SOMETHING, other than cut taxes, to try to stimulate the economy.

It’s been done before, in the Weimar Republic before Hitler took power, in Japan before the “lost decade,” in Argentina before their collapse, and in England, and the US, in response to the global financial crisis.

It is normally seen as a desperate attempt to defibrillate a dying economy, and it has a terrible track record!

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What are some of the impacts?

Of course, printing money out of thin air means that there are more dollars floating around. Unless we have a corresponding increase in GDP, that means that the dollar will probably drop in relation to foreign currencies. It means that anything purchased in Pesos, Euros, Rupees, Baht, or Yen will get more expensive — like fruits, vegetables, coffee, customer support for large companies, clothes, electronics, etc.

So far, the dollar has declined slowly because of people moving out of Yen and Euros and into Dollars. Likewise, inflation has been moderate because of cheap goods flooding the market from “going out of business sales” and people who’ve lost their jobs selling “all that they own.” This, of course, is not sustainable.

In any case, keep pumping money into an economy, without increasing production, and more dollars end up chasing after the same number of goods, which leads to inflation, or hyper inflation.

So, why is the Fed doing this?

Many people have made the argument that they’re trying to destroy the country. Let’s take that argument off the table and look at some of the other reasons why they would do it.

As a sign to other countries that we are through the worst of our financial troubles:

The argument here is that if we were in trouble, the Fed would have created $2.3 trillion or more. The fact that they ONLY created $600 Billion is somehow supposed to give our international trading partners confidence in our economy.

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Encourage corporate spending and investing:

By pumping money into government bonds and lowering the yields, corporate bonds, corporate investment, and stock in large & small companies will look more attractive. This still doesn’t seem to be a good enough reason to create $600 billion, plus now $40 billion a month out of thin air. They could have encouraged corporate spending and investing by simplifying the tax code and streamlining regulation.

Foreclosure Crisis/Credit Default Swaps:

Right now, several major banks have so many bad mortgages on their books that if they’d foreclose on them all and sell them at fair market prices, they would lose so much money that the FDIC would declare them bankrupt and shut their doors. Many of these major banks bought insurance on the mortgage bundles that they own. This insurance was called a “credit default swap.” These credit default swaps were issued by other major banks.

This injection of money by the Fed may be necessary to prevent another round of bank bankruptcies like Merrill, Lehman, and AIG. If nothing else, it’s easier for the general public to stomach than another “bailout” or “stimulus.”


 Quantitative Easing & What It Means To You: QE1 + QE2 + QE3 = American Bankrupt Future

Perhaps the FED is running out of Options:

The quantitative easing, along with the convenient timing of the recent suspension of foreclosures by Bank of America, and others, are signs that the Fed is running out of levers to pull in order to keep the banking system running in its current form.

What to do?

This is the big question. Of course, quantitative easing isn’t the problem — it’s merely an outward sign of a long term financial cancer.

So, whether you think it will lead to no inflation, some inflation, or hyper inflation, one of the smartest steps that you can take, over the next few days and weeks, is to start buying more of the foods that you currently eat than you are consuming.  Start buying gold and silver which have a long history of hard value.  Buying storable, gourmet, “survival food,” that you will actually eat, no matter what happens, is one of the wisest things you can do!

Quantitative easing is the wakeup call to get your family prepared QUICKLY, before inflation takes hold, before China drops the dollar, or before the dollar collapses!

MFS a 728x90 Quantitative Easing & What It Means To You: QE1 + QE2 + QE3 = American Bankrupt Future

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Jun 07

World Economic Collapse At Hand, Debt is Running Wild Like a Rabid Dog!

Ever since the beginning of the financial crisis and quantitative easing, the question has been before us:  How can the Federal Reserve maintain zero interest rates for banks and negative real interest rates for savers and bond holders when the US government is adding $1.5 trillion to the national debt every year via its budget deficits?  Not long ago the Fed announced that it was going to continue this policy for another 2 or 3 years. Indeed, the Fed is locked into the policy. Without the artificially low interest rates, the debt service on the national debt would be so large that it would raise questions about the US Treasury’s credit rating and the viability of the dollar, and the trillions of dollars in Interest Rate Swaps and other derivatives would come unglued.
In other words, financial deregulation leading to Wall Street’s gambles, the US government’s decision to bail out the banks and to keep them afloat, and the Federal Reserve’s zero interest rate policy have put the economic future of the US and its currency in an untenable and dangerous position.  It will not be possible to continue to flood the bond markets with $1.5 trillion in new issues each year when the interest rate on the bonds is less than the rate of inflation. Everyone who purchases a Treasury bond is purchasing a depreciating asset. Moreover, the capital risk of investing in Treasuries is very high. The low interest rate means that the price paid for the bond is very high. A rise in interest rates, which must come sooner or later, will collapse the price of the bonds and inflict capital losses on bond holders, both domestic and foreign.
The question is: when is sooner or later?  The purpose of this article is to examine that question.
Let us begin by answering the question: how has such an untenable policy managed to last this long?
A number of factors are contributing to the stability of the dollar and the bond market. A very important factor is the situation in Europe.  There are real problems there as well, and the financial press keeps our focus on Greece, Europe, and the euro. Will Greece exit the European Union or be kicked out?  Will the sovereign debt problem spread to Spain, Italy, and essentially everywhere except for Germany and the Netherlands?
Will it be the end of the EU and the euro?  These are all very dramatic questions that keep focus off the American situation, which is probably even worse.
The Treasury bond market is also helped by the fear individual investors have of the equity market, which has been turned into a gambling casino by high-frequency trading.
High-frequency trading is electronic trading based on mathematical models that make the decisions. Investment firms compete on the basis of speed, capturing gains on a fraction of a penny, and perhaps holding positions for only a few seconds.  These are not long-term investors. Content with their daily earnings, they close out all positions at the end of each day.
High-frequency trades now account for 70-80% of all equity trades. The result is major heartburn for traditional investors, who are leaving the equity market. They end up in Treasuries, because they are unsure of the solvency of banks who pay next to nothing for deposits, whereas 10-year Treasuries will pay about 2% nominal, which means, using the official Consumer Price Index, that they are losing 1% of their capital each year.  Using John Williams’ (shadowstats.com) correct measure of inflation, they are losing far more.  Still, the loss is about 2 percentage points less than being in a bank, and unlike banks, the Treasury can have the Federal Reserve print the money to pay off its bonds.  Therefore, bond investment at least returns the nominal amount of the investment, even if its real value is much lower. (For a description of High-frequency trading, see: http://en.wikipedia.org/wiki/High_frequency_trading )
The presstitute financial media tells us that flight from European sovereign debt, from the doomed euro, and from the continuing real estate disaster into US Treasuries provides funding for Washington’s $1.5 trillion annual deficits. Investors influenced by the financial press might be responding in this way.  Another explanation for the stability of the Fed’s untenable policy is collusion between Washington, the Fed, and Wall Street. We will be looking at this as we progress.
Unlike Japan, whose national debt is the largest of all, Americans do not own their own public debt.  Much of US debt is owned abroad, especially by China, Japan, and OPEC, the oil exporting countries. This places the US economy in foreign hands.  If China, for example, were to find itself unduly provoked by Washington, China could dump up to $2 trillion in US dollar-dominated assets on world markets. All sorts of prices would collapse, and the Fed would have to rapidly create the money to buy up the Chinese dumping of dollar-denominated financial instruments.
The dollars printed to purchase the dumped Chinese holdings of US dollar assets  would expand the supply of dollars in currency markets and drive down the dollar exchange rate. The Fed, lacking foreign currencies with which to buy up the dollars would have to appeal for currency swaps to sovereign debt-troubled Europe for euros, to Russia, surrounded by the US missile system, for rubles, to Japan, a country over its head in American commitment, for yen, in order to buy up the dollars with euros, rubles, and yen.

Paul Craig Roberts
June 6, 2012

Read Full Articale Here:  http://www.paulcraigroberts.org/2012/06/05/collapse-at-hand/

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Mar 20

The U.S. Economy: Mainstream Media says Proclaims Recovery “More LIES!”, Truth is a Total System Failure

No matter how often the pretty people on television tell us that the U.S. economy is getting better, it isn’t going to change the soul crushing agony that millions of American families are going through right now.  The stock market may have gotten back to where it was in 2008, but the job market sure hasn’t.  As I wrote about a few days ago, the percentage of working age Americans that are actually employed has stayed very flat since late 2009, and the average duration of unemployment is hovering near an all-time high.  Sadly, this is not just a temporary downturn.  The U.S. economy has been slowly declining for several decades and is nearing total system failure.  Right now, many poverty statistics are higher than they have ever been since the Great Depression.  Many measurements of government dependence are the highest that we have ever seen in all of U.S. history.  The emerging one world economic system (otherwise known as “free trade”) has cost the U.S. economy tens of thousands of businesses, millions of jobs and hundreds of billions of dollars of our national wealth.  The federal government is going into unprecedented amounts of debt in order to try to maintain our current standard of living, but there is no way that they will be able to sustain this kind of borrowing for too much longer.  So enjoy this bubble of false prosperity while you can, because things will soon get significantly worse.

As the U.S. economy experiences total system failure, it will be imperative for all of us not to wait around waiting for someone to rescue us.

And I am not just talking about the government.

Today, millions upon millions of Americans are waiting around hoping that someone out there will hire them.

Well, the truth is that our politicians have made it so complicated and so expensive to hire someone that many small businesses try to avoid hiring as much as possible.

Businesses generally only want to hire people if they can make a profit by doing so.  When our politicians keep piling on the taxes and the regulations and the paperwork, that creates a tremendous incentive not to hire workers.

Michael Fleischer, the President of Bogen Communications, once wrote an op-ed in the Wall Street Journal entitled “Why I’m Not Hiring”.  The following is how Paul Hollrah of Family Security Matters summarized the nightmarish taxes that are imposed on his company when Fleischer hires a new worker….

According to Fleischer, Sally grosses $59,000 a year, which shrinks to less than $44,000 after taxes and other payroll deductions. The $15,311 deducted from Sally’s gross pay is comprised of New Jersey state income tax: $1,893; Social Security taxes: $3,661; state unemployment insurance: $126; disability insurance: $149; Medicare insurance: $856; federal withholding tax: $6,250; and her share of medical and dental insurance: $2,376. Roughly 25.9 percent of Sally’s income is siphoned off by Washington and Trenton before she receives her paychecks.

But then there are the additional costs of employing Sally. In addition to her gross salary, her employer must pay the lion’s share of her healthcare insurance premiums: $9,561; life and other insurance premiums: $153; federal unemployment insurance: $56; disability insurance: $149; worker’s comp insurance: $300; New Jersey state unemployment insurance: $505; Medicare insurance: $856; and the employer’s share of Social Security taxes: $3,661.

Over and above her gross salary, Bogen Communications must pay an additional $15,241 in benefits and state and federal taxes, bringing the total cost of employing Sally to approximately $74,241 per year. Sally gets to keep $43,689, or just 58.8% of that total.

Are you starting to understand why so many businesses are hesitant to hire new workers?

 

The big corporations can handle all of the paperwork and regulations that come with hiring a new worker fairly well, but for small businesses hiring a new worker can be a massive undertaking. That new worker is going to have to almost be a miracle worker in order to justify all of the hassle and expense.

But the federal government just keeps piling more burdens on to the backs of employers.  That is one reason why there is such an uproar over Obamacare.  It is going to make hiring workers even less attractive.

These days, most small businesses are trying to get by with as few workers as possible, and many big businesses are trying to ship as many jobs as they can overseas.

Sadly, even if you do find a good job it can disappear at any moment.

The following is from a comment that a reader named Jeff recently left on one of my articles….

It’s sad what’s happening here in this country. So many lucky ones defend it. In America it’s not exactly about hard work anymore, it’s about who you know always. The ability to keep people stupid as well as in debt was established here well by corporations also. You cannot start a solid hiring business like you could years ago.

I know many of folks who don’t break a sweat and earn more money than I ever will in a week. The system is getting crazy only creating two extremes. I fought for this country right after 9/11 as a young naive person. Using my grandfather’s old stories to see the dream that this country was always suppose to have.

The company I still unfortunately work for (cause other places are worse), 4 years ago they froze our salaries. No raises yet, this is when the company was bought by an investment group for 500 million.

Now we are getting sold to Japan for 1 billion. A 500 million dollar profit. Sorry if I may be ignorant in this way of business. But it seems the only one who benefited from this is that group of investors. 400+ well skilled jobs lost, no raises or rewards, a whole lot more work and contract obligations to meet, and less contact with management when problems surface.

I just think the United States of America is becoming the world’s poker table.

I want out of this country so bad. I don’t even know what happen to people here. The younger generation scares me how dumb they are and everyone seems so easily bought with eyecandy.

 

Can you imagine that?

Can you imagine your boss walking in one day and declaring that the business has just been sold to foreigners and that you are about to lose your job?

In America today, it can be absolutely soul crushing to lose a job.  It isn’t as if you are going to run out and get another fantastic job in a week or two.

When you are unemployed, people look at your differently.  It gets to the point where you don’t even want to interact with other people because you know that your unemployment is probably going to be the number one topic of conversation.

When you are out of work for six months or more, it is easy to feel like a failure – especially when so many other people are looking at you as if you are a failure too.

But in most cases, individual Americans are not to blame for not being able to find work.

Rather it is the entire system that is failing all of us.

The U.S. economy is bleeding good jobs and the middle class in America has become a bizarre game of musical chairs.  When the music stops each round you might lose your spot.  You just never know.

Looking for work in the United States in this economic environment can be a demoralizing endeavor.  For example, a recent Esquire article described what one unemployed man named Scott Annechino found when he attended a job fair in San Francisco….

A glass elevator carries him to the third floor, where the front-desk girl, who knows it’s her job to be cheerful, told him the job fair is supposed to be.

A pasty kid, maybe thirty, in a too-big shirt and a cheap tie, greets him and tells him the companies are set up in rooms along the hall and that he should definitely visit all of them. Annechino, forty-four years old, wearing his best suit and shined black shoes, walks to the first exhibitor: Devcon, a home-security company. The door is closed, no one inside. Annechino looks around for an explanation. “Oh, I just got an e-mail from my contact there saying they wouldn’t be able to make it today,” the pasty kid says, fingering his BlackBerry.

A couple of other potential employers who were supposed to be here didn’t make it, either — Konica Minolta, Santa Clara University. “Yeah …” the kid says. Annechino moves to the next room. State Farm. They’re looking for people who can put up fifty grand to start their own insurance agency. The Art Institute is next, mostly looking for people who might want to go to art school. New York Life. The U. S. Army, where men wearing fatigues and combat boots offer brochures.

That’s it.

If you want to check out the rest of the sad unemployment stories in that article, you can find them right here.

But even if you do have a job, that doesn’t mean that everything is just fine.  Average American families are finding that the prices of the basic things that they need are rising much faster than their paychecks are.

According to one recent study, more than half of all Americans feel as though they are really struggling to afford just the basics at this point….

“Every retailer wants to think ‘Everything I sell is worth it! Shoppers will love it’, but the hard reality is 52% Americans feel they barely have enough to afford the basics,” said Candace Corlett, president of WSL/Strategic Retail.

Just buying food and gas is a major financial ordeal for many families these days.  On average, a gallon of gasoline in the United States now costs $3.83.  Many Americans burn up a huge chunk of their paychecks just going back and forth to work in their cars.

So what is the solution?

Well, according to the Obama administration the answer is even more government dependence.  The federal government is now actually running ads encouraging even more people to go on food stamps….

Can you believe that?

Apparently having 46.5 million Americans on food stamps is not enough.  The federal government is spending our tax money on advertisements that try to convince even more Americans that they need to be on food stamps.

What the American people really need are good jobs, but those keep getting shipped out of the country.

Meanwhile, people are becoming increasingly desperate.

For example one Colorado man was recently caught stealing parts from toilets in public restrooms….

Donald Allen Citron, 48, faces 18 charges, including burglary and theft. He’s accused of stealing toilet parts from several locations, including Southwest Plaza Mall, University of Denver, and Craig Hospital.

Most of the crimes happened in just a few minutes, but police Citron is a plumber and all he needed was a wrench and a screw driver to steal pipes and the plumbing in toilets. The items he’s accused of stealing are valued at around $6,400.

They are calling him “the crapper scrapper”.

Other Americans are not willing to stoop to crime and instead suffer quietly and anonymously.

A reader named Katie recently left the following heartbreaking comment on one of my articles….

I’m almost homeless. Through no fault of my own I’d like to point out. I don’t drink, smoke, or do drugs. I don’t even eat fast food unless I have too.

Four years ago I had a house, car, family, stuff, an IRA, and really everything that people in this country aspire to. I had a great job that I enjoyed so did my boyfriend. Even our relationship was great.

We didn’t get hit by the economy right away. We were in Katrina damaged parts of the country and there was still a lot of construction going on and the economic boom that comes with it.

Then I got laid off. Doesn’t seem to matter that I go to interview after interview. I use indeed, monster, craigslist, and newspapers to search for jobs even outside my area.

Now my boyfriend has passed away suddenly, and his family got everything. I personally have only a living father left, who hasn’t the room but I’m camping in his yard. All my friends say they don’t have the room either. Which makes me wonder just how much of friends they are. Considering if the situation was reversed I have in the past and would open my home to anyone that needed help.

If something happens to him I really don’t know what I’m going to do. I need to get on my feet and I know that jobs are hard to come by. I’m sick of the people who have jobs saying ‘get a job you lazy bum’. I’m hardly lazy and I’m trying desperately to be employed; not being homeless would be rather awesome in my opinion. I’m not picky, regardless of my degree I’ll pick up trash or clean toilets. McDonald’s, Taco Bell and the other fast food places don’t even bother with a call back. And when I call to inquire about my application it’s always the same, ‘we will call you when we make a decision’. Such a cop-out.

So no. In my (granted meaningless opinion) the economy is not getting better. To even suggest that when unemployment is so high or the rate of food stamps. Is utter ludicrous at best. I notice that those talking heads on the cable news and radio never seem to mention that the homeless shelters have a higher occupancy level than ever before. Nor would they mention the fact that we have those shelters in abundance now across the country in comparison to the Great Depression.

I’m getting real tired of hearing how great the economy is doing. When obviously it’s not. All you have to do is open your eyes and see. Business are not coming back yet and foreclosed homes sit empty everywhere. The unemployment rate only counts the people who are getting unemployment benefits. So the people who fall off the unemployment benefits don’t get counted. Because the must have gotten a job, right? Hardly. In fact the homeless in this country are almost never counted correctly. It’s too hard to count them all, or at least that’s the excuse.

I know it’s meaningless, especially to those who see homeless and immediately have a bias, but that’s my opinion on the current state of our economy. You can count me in the 80%. Only a fool would see this as a recovery.

Please say a prayer for Katie and the millions of other Americans just like her.  It can be absolutely soul crushing to lose everything that you ever worked for and not see any light at the end of the tunnel.

Unfortunately, the U.S. economy is not going to be improving in the long run.  What we are experiencing right now is about as good as it is going to get.  The truth is that it is pretty much downhill from here.

It is fairly simple to figure out what is happening to us as a nation.

You can’t keep buying far more than you sell.

You can’t keep spending far more than you bring in.

You can’t keep running up debt in larger and larger amounts indefinitely.

The U.S. economy is running on borrowed money and on borrowed time.

At some point, both are going to run out.

Are you ready for that?

Feb 15

States seek currencies made of silver and gold

A growing number of states are seeking shiny new currencies made of silver and gold.

Worried that the Federal Reserve and the U.S. dollar are on the brink of collapse, lawmakers from 13 states, including Minnesota, Tennessee, Iowa, South Carolina and Georgia, are seeking approval from their state governments to either issue their own alternative currency or explore it as an option. Just three years ago, only three states had similar proposals in place.

“In the event of hyperinflation, depression, or other economic calamity related to the breakdown of the Federal Reserve System … the State’s governmental finances and private economy will be thrown into chaos,” said North Carolina Republican Representative Glen Bradley in a currency bill he introduced last year.

Unlike individual communities, which are allowed to create their own currency — as long as it is easily distinguishable from U.S. dollars — the Constitution bans states from printing their own paper money or issuing their own currency. But it allows the states to make “gold and silver Coin a Tender in Payment of Debts.”

To the state legislators who are proposing state-issued currencies, that means gold and silver are fair game, said Edwin Vieira, an alternative currency proponent and attorney specializing in Constitutional law.  And since gold has grown exponentially more valuable, while the U.S. dollar continues to lose ground, the notion has become increasingly appealing to state lawmakers, he said.

The state gold rush: Utah became the first state to introduce its own alternative currency when Governor Gary Herbert signed a bill into law last March that recognized gold and silver coins issued by the U.S. Mint as an acceptable form of payment. Under the law, the coins — which include American Gold and Silver Eagles — are treated the same as U.S. dollars for tax purposes, eliminating capital gains taxes.

Since the face value of some U.S.-minted gold and silver coins — like the one-ounce, $50 American Gold Eagle coin — is so much less than the metal value (one ounce of gold is now worth more than $1,700), the new law allows the coins to be exchanged at their market value, based on weight and fineness.

Local currencies: In the U.S., we don’t trust

“A Utah citizen, for example, could contract with another to sell his car for 10 one-ounce gold coins (approximately $17,000), or an independent contractor could arrange to be compensated in gold coins,” said Rich Danker, a project director at the American Principles Project, a conservative public policy group in Washington, D.C.

South Carolina Republican Representative Mike Pitts proposed a currency system that would allow people to use any kind of silver or gold coin — whether it’s a Philippine Peso or a South African Krugerrand — based on weight and fineness. Pitts said in the bill, which currently has 12 co-sponsors, that the state is facing “an economic crisis of severe magnitude.”

Republican representatives from Washington State followed suit in January, introducing a bill that would also allow any gold and silver coins to be considered legal tender based on metal values. Minnesota, Iowa, Georgia, Idaho and Indiana are also considering similar proposals.

Many of the bills would make it possible for residents to exchange the physical coins for goods and services, so you could use coins to buy anything from groceries to a car as long as the store chooses to accept them.

However, most people aren’t going to walk around with such valuable coins in their pockets, said Vieira. Plus, calculating the value of the coins — especially if they come from different parts of the globe and are of different sizes and shapes — will get tricky.

See Full Ariticle at CNNMoney.com

 

Jan 26

Gold Climbing Back to $2,000 on News that Federal Reserve Vows to Keep Rates Low & Home Sales Fall

Oil rose to near $100 a barrel Thursday in Asia after the U.S. Federal Reserve said it would keep interest rates at record lows at least until 2014 to help jump-start the world’s biggest economy.

As we suspected yesterday, crude oil prices edged higher after an overtly dovish FOMC announcement sank the US Dollar. The move higher was muted by a pickup in inventories however, where the weekly build more than doubled expectations. Looking ahead, a mixed set of US economic data is ahead, with expectations calling for a slowdown in Durable Goods Orders but improvements on the composite Leading Indicators index and New Home Sales. However, the earnings calendar may prove most market-moving as a hefty dollop of industrials report results, with traders particularly interested in guidance from the likes of Caterpillar Inc as a proxy gauge of the global business cycle (and thereby oil demand prospects).

The U.S. central bank, which has kept its benchmark interest rate near zero for three years, said Wednesday that it doesn’t plan to raise the rate before late 2014.

That caused the dollar to turn lower against major currencies, which makes dollar-priced oil less expensive for holders of other currencies.

“That would mean the U.S. dollar would continue to be cheap versus other currencies, and there is typically an inverse correlation between the value of the dollar and commodity pricing,” said Victor Shum, an energy analyst at consultancy Purvin & Gertz in Singapore.

The median sales price for a new home fell 2.5 percent to $210,300 last month, the biggest drop in four months. Compared to December last year, the median price was down 12.8 percent.

There were a record low 157,000 new homes on the market last month and at December’s sales pace, it would take 6.1 months to clear them, up from 6.0 months in November.

Spot Gold (NY Close): $1710.57 // +44.90 // +2.70% 

Not surprisingly, gold soared after the Federal Reserve extended its pledge to keep interest rates at “exceptionally low” levels to the end of 2014 from the previously promised mid-2013. With the central bank determined to keep borrowing costs near-zero for the foreseeable future and recent US economic data pointing to a pickup in activity, inflation expectations are understandably climbing and boosting demand for the yellow metal as a store-of-value hedge. Indeed, the 2-year breakeven rate – a measure of inflation expectations derived from bond yields – soared to the highest in nearly 7 months after the FOMC outcome crossed the wires.

Spot Silver (NY Close): $33.16 // +1.12 // +3.49%

As with gold, silver prices soared higher after the dovish FOMC outcome stoked future inflation bets, with more of the same seemingly likely ahead. Likewise in line with its more expensive counterpart, the spotlight now turns to US economic data to see if positive momentum resumes or falters, with the latter scenario likely to defuse what will otherwise almost certainly amount to another major advance for precious metals. Prices are testing resistance in the 38.78-33.30 region, with break higher exposing 35.30. Near-term support lines up at 31.04.

Aug 09

Gold near $1,800 after biggest 3-day rally EVER! Get Some Before It Jump to $2,500!

Gold hit a record high on Tuesday in its biggest three-day rally since the  depths of the financial crisis in 2008, as investor fears over the threat to the  global economy from the European and U.S. debt crises hit assets seen as higher  risk.

Though spot prices retreated from highs as stock markets opened higher in the  United States, they remained up 1.4 percent on the day at $1,739.60 an ounce at  9:42 a.m. EDT, having earlier peaked at $1,778.29.

“The short run uptrend is intact,” said VTB Capital analyst Andrey  Kryuchenkov. “Panic dominates for now and even though we have rebounded a bit on  the broader market, people will still fear liquidating substantial gold  longs.”

The price of gold hit a record high this week, climbing to over $1,700 an ounce. With panic rising and the stock market falling, some people are considering investing in gold or moving funds from the volatile market into gold.

Is the price enough to drive you to  the pawn shop? We want to know: have you or are you planning to sell any  gold? Have you thought about digging through an old drawer or jewelry box for gold to sell? What will you do with the money?

Gold has risen by about 7 percent this month, driven by flows of cash out of  equities, bonds and currencies, after the United States lost its top-notch  credit rating.

The US dollar ticked down against major currencies following the release of Fed’s rate decision at 2:15 pm ET Tuesday. The Federal Open Market Committee or FOMC , Fed’s policy making arm, maintained its key interest rate unchanged at between 0.00 percent to 0.25 percent. Presently, the greenback is trading near 1.6266 versus the British pound, 1.4295 against the euro, 0.7187 versus the Swiss franc and 76.97 versus the Japanese yen.

The Best investment right now is GOLD!  Buy and HOLD!

gft blog ad image2 Gold near $1,800 after biggest 3 day rally EVER! Get Some Before It Jump to $2,500!

Jul 18

Gold Prices Hit Record High $1,600 Silver Over $40.30 on Fiat Currency Crisis and US Debt limit

Gold prices broke a new record Monday, driven by concerns over mounting debt worries in the United States and Europe.  Gold futures for August delivery reached a fresh high of $1,602.50 per ounce in early trading Monday.  The yellow metal has been on a roll since July 12, when it got an extra boost from the minutes of the Federal Reserve’s June policy meeting. They indicated that the central bank could be open to more monetary stimulus.  Further stimulus could undermine the U.S. dollar, triggering a flight to gold, the age-old stalwart in troubled times, when investors are afraid to put their money elsewhere.

Market does the “Hussle”

Remington-Hobbs also said that gold prices could be heavily influenced this week by what Federal Reserve Chairman Ben Bernanke says when he speaks Thursday about financial regulation.

Silver was taking its cues from gold, with prices breaking the $40-an-ounce mark for the first time since May 4. Silver rose nearly 3% on Monday to $40.13 per ounce but is still short of its April 25 record of $49.81, noted Remington-Hobbs.

Gold is also still far from its true peak, when adjusted for inflation. Gold hit its real record on Jan. 21, 1980, when it rose to $825.50 an ounce. Adjusted for inflation from 1980 dollars to 2011, that translates to an all-time record of $2,261.33 an ounce.

Silver advanced 6.92% to settle the week at $40.70 amid global suspicions including failure of the US politicians to raise the debt ceiling as the deadline for the same is approaching.

The dollar index remained settled 0.07% below previous week closing after rating agencies threaten US the possibility of losing their credit rating and by a stalled talks on raising debt ceiling.

Global equities measured by the MSCI all country world indexes, posted a 2.23% fall while the Asian benchmark index declined by 1.95%, its first since past four weeks, as the EU finance ministers declined to rule out a temporary default for Greece. On the other hand, the CRB Index, a bellwether for commodities, advanced by 0.80%.

Fitch has cut Greece’s credit grades to its lowest for any country in the world. The move from “B+” to “CCC” reflects the absence of a new fully funded and credible program by the IMF and the EU which intensified a real possibility of default.

US Debt Ceiling Concerns

The US government will need to decide on raising the debt ceiling by the beginning of August; it’s mostly likely to be passed in the next couple of weeks, but in the mean time the internet continues to explore this issue. Moody’s rating agency even went one step further and suggested the United States to eliminate its statutory limit on government debt in order to reduce uncertainty among bond holders.

beprepared 600x150 Gold Prices Hit Record High $1,600 Silver Over $40.30 on Fiat Currency Crisis and US Debt limit

 

Jun 21

IMF says Spain’s economy still facing major risks, While Gold Settles Above $1,546 on Greek Crisis Concerns

The Spanish economy still faces “considerable” risks, the International Monetary Fund has warned.

In an annual report, the IMF said the Spanish government had to continue work to reduce public spending, and increase efforts to liberalise its jobs market.

Since last year Madrid has been carrying out austerity measures to reduce the country’s public deficit.

Unlike other highly indebted eurozone nations such as Greece and Portugal, it has not needed an outside bail-out.

While the IMF did not comment on whether this remained a possibility for Spain, it warned that financial conditions could deteriorate further in the eurozone, which “could put additional pressure on sovereign and bank funding costs for Spain”.

As a result, the fund said there could be “no let up in the reform momentum” to both help boost Spain economy and ease the concerns of the financial markets.

It added that Spain’s 21% unemployment rate – the highest in Europe – was “unacceptably high”.

To help reduce unemployment, the Spanish government is continuing to change the country’s labour laws.  Madrid hopes the changes will make firms more willing to take on new staff, because historically it has been difficult for Spanish companies to make staff
redundant.

As part of Spain’s continuing austerity measures – which have sparked a number of large protests across the country – the government is also reducing the pensions of public sector workers.  Desite the IMF’s warnings, it said Spain was still on track to reduce the country’s public deficit from 9.2% of its annual economic output in 2010, to 6% this year.

Gold rose to settle above $1,546 on Tuesday, driven by a weaker dollar and uncertainty over the outcome of a confidence vote in Greece that may determine whether the country can avert a default on its sovereign debt.

Bullion also got a lift from a return of investor risk appetite, as the grains, commodity and equity markets rose across the board on hopes that the Greek government could avoid defaulting on its sovereign debt.

On the options front, gold volatility has dropped by nearly one-fifth from its peak in mid-May, as prices of the underlying gold futures have largely been rangebound after rallying to a record $1,575.79 on May 2.

“Gold has been split between taking its cue from the changes in sovereign risk, but today the sovereign risk has declined and the euro … has rallied and gold is choosing to track the euro more than it is the reduction in sovereign risk,” said James Steel, chief commodities analyst at HSBC.

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