Tag Archives: Financial Sabotage / Espionage

New IMF Report on Greece Says Projections Are Unrealistically Optimistic

They went ahead with it, anyway

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by Eric Zuesse | Infowars.com | Originally published July 15, 2015

new IMF report on Greece, issued on Tuesday, July 14th, is titled “AN UPDATE OF IMF STAFF’S PRELIMINARY PUBLIC DEBT SUSTAINABILITY ANALYSIS,” and it says — these are quotations, not paraphrases — in summary

Greece’s public debt has become highly unsustainable. … The financing need through end-2018 is now estimated at Euro 85 billion. … Greece’s debt can now only be made sustainable through debt relief measures that go far beyond what Europe has been willing to consider so far. … Public debt cannot be assumed to migrate back onto the balance sheet of the private sector at interest rates consistent with debt sustainability until debt is much lower. Greece cannot return to markets anytime soon at interest rates that it can afford. … Medium-term primary surplus target: Greece is expected to maintain primary surpluses for the next several decades of 3.5 percent of GDP. Few countries have managed to do so. …

Shortfalls in program implementation during the last year led to a significant increase in the financing need [which was] estimated only a few weeks ago. … The preliminary (mutually agreed) assessment of the three institutions is that total financing need through end-2018 will increase to Euro 85 billion, or some Euro 25 billion above what was projected in the IMF’s published DSA [Debt Sustainability Analysis] only two weeks ago. … 

Debt would peak at close to 200 percent of GDP in the next two years. This contrasts with earlier projections that the peak in debt—at 177 percent of GDP in 2014—is already behind us.

By 2022, debt is now projected to be at 170 percent of GDP, compared to an estimate of 142 percent of GDP projected in our published DSA.

Gross financing needs would rise to levels well above what they were at the last review (and above the 15 percent of GDP threshold deemed safe) and continue rising in the long term.

Moreover, these projections remain subject to considerable downside risk, suggesting that there could be a need for additional further exceptional financing from Member States.

ADDITIONAL:

Though this report revises the previous IMF estimates, which had been issued just two weeks ago, the new report was (according to the Wall Street Journal) “circulated to eurozone officials over the weekend and published more broadly Tuesday.” This would mean that when the Greek government and its creditors reached agreement on Sunday night, July 12th, they already knew that the estimates on which their deal was reached were unrealistically optimistic. They went ahead with it, anyway.

The Greek public had overwhelmingly voted a week earlier to reject a deal that was less draconian than the one which was reached on July 12th, and yet the Greek government, which had urged them to vote against it, promptly ignored that vote against it, which the Greek government had been calling for. And, now, it appears that both sides to the deal even knew that its terms are impossible, yet ignored that, and agreed to it.

The persistent and ongoing deceit here is hard to square with widespread allegations that the EU is at all democratic. The origin of this loan and earlier loans to Greece (euphemistically called ‘bailouts,’ as if it weren’t the banks which were being bailed out by the taxpayers, instead of the Greek public, who had never received the benefits of those loans anyway) had been private investors in Greek government bonds, receiving high interest rates on these junk bonds, which turn out to have been guaranteed by Western publics bailing out Western banks. Between 2010 and 2015, the IMF and other Western taxpayer-supported debt-transfer agents, bought those bum loans and thus transferred those risks from private investors onto taxpayers. And now, this continues, though with one major added poison pill for the Greek public: “privatization.” Greek government assets, including everything from highways to health care, will be sold off to investors at steeply depreciated prices, so that the Greek public will have not only skyrocketing taxes but also disappearing government services. Obviously, the youth-unemployment rate of near 50% will become much worse, and virtually all young Greeks will move elsewhere in Europe, while their parents will die, or even increasingly commit suicide, in the soaring poverty of the Greek ghost-town state. Greece’s essential tourist industry will collapse. But the banks, and the investors in the bank stocks, will be protected. This is socialism for the rich, capitalism for the poor. Call it fascism.

 

Investigative historian Eric Zuesse is the author, most recently, of  They’re Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, and of  CHRIST’S VENTRILOQUISTS: The Event that Created Christianity.

Sealed HSBC Report Shows U.S. Managers Battling Clean-up Squad

Managers from unit battled auditors with four-part strategy — Discredit, Deny, Deflect and Delay

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by Greg Farrell | Bloomberg | Originally published July 7, 2015

HSBC Holdings Plc, smarting from a $1.9 billion fine for providing banking to money launderers and sanctions-dodgers, promised U.S. officials it would clean up its act.

Within a year, its reform efforts met resistance from leaders of HSBC’s U.S. investment-banking unit — some of whom mounted a campaign of bullying, footdragging and discrediting against in-house watchdogs, according to previously unreported details from a report by the bank’s court-appointed monitor.

HSBC agreed to submit to the monitor’s oversight in late 2012, as part of a pact with the U.S. Justice Department that required it to bolster its in-house controls. Armed with that directive, HSBC compliance officers singled out a half-dozen clients whose activities could put the London-based bank at risk — including a Saudi bank that had been linked to Sept. 11, 2001, hijackers — and advised the U.S. investment-banking division to consider dropping those relationships.

There was no indication that the U.S. managers jumped to investigate. Instead, some of them requested that the six banks’ alleged sins be omitted from an in-house audit that compliance-team members were preparing to submit to HSBC’s top executives. The compliance team’s final audit omitted specifics about the banks, according to the monitor’s report.

As that audit took shape, U.S. investment banking managers put up other resistance, according to the court-appointed monitor’s report: One manager shouted at a compliance officer for wasting his time and dismissed her findings. Overall, the report says, managers from the unit battled auditors with what one compliance officer characterized as a four-part strategy — Discredit, Deny, Deflect and Delay.

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Maintaining the Illusion of Stability Now Requires Ever-Greater Extremes

Brittleness is being passed off as stability

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by Charles Hugh Smith | Of Two Minds | July 10, 2015

 

This much-needed re-set to an economy that serves the many rather than the few is what the Powers That Be are so fearful of.

On the surface, everything still looks remarkably stable in the core industrial economies. The stock markets in Japan, Germany and the U.S. are only a few percentage points off their highs, and we’re constantly assured that inflation no longer exists and official unemployment is low.

In other words, other than the spot of bother in Greece, life is good. Anyone who signs on the dotted line for easy credit can go to college, buy a car or house or get another credit card.

With more credit, everything becomes possible. With unlimited credit, the sky’s the limit, and it shows.

Europe is awash with tourists from the U.S., China and elsewhere, and restaurants are jammed in San Francisco and New York City, where small flats now routinely fetch well over $1 million.

In politics, the American public is being offered a choice of two calcified, dysfunctional aristocracies in 2016: brittleness is being passed off as stability, not just in politics but in the economy and the cultural zeitgeist.

But surface stability is all the status quo can manage at this point, because the machine is shaking itself to pieces just maintaining the brittle illusion of prosperity and order.

 

Consider what happened in Greece beneath the surface theatrics.

1. Goldman Sachs conspired with Greece’s corrupt kleptocracy to conjure up an illusion of solvency and fiscal prudence so Greece could join the Eurozone.

2. Vested interests and insiders gorged on the credit being offered by German and French banks, enriching themselves to the tune of tens of billions of euros, which were transferred to private accounts in Switzerland at the first whiff of trouble. When informed of this, Greek authorities took no action; after all, why track down your cronies and force them to pay taxes when tax evasion is the status quo for financial elites?

3. If Greece had defaulted in 2010 when its debt was around 110 billion euros, the losses would have fallen on the banks that had foolishly lent the money without proper due diligence or risk management. This is what should have happened in a market economy: those who foolishly lent extraordinary sums to poor credit risks take the resulting (and entirely predictable) losses.

4. But since the big European banks that were on the hook for the 110 billion in bad debt were highly leveraged (estimates are 30 to 1), then a mere 5% loss in their capital would render them insolvent–a Lehman Moment of cascading defaults that the European leadership could not allow, as not only would their cronies lose fortunes but they would lose power when the fragile house of cards they’d constructed collapsed.

Here is the debt in 2009–mostly owed to private banks and bondholders:

5. The status quo’s solution: transfer all the private bank debt to the taxpayers of the Eurozone members and loan Greece another 200+ billion euros in exchange for the illusion of reform and a squeezing of average Greek households to pay the interest due on the ballooning debt.

Here is the debt in 2015–almost all was shifted onto the backs of Eurozone taxpayers:

6. Five years later, the debt has exploded to 340 billion euros, triple the debt that should have been written off in 2010 when it became clear Greece could not pay the debt down or even service the interest payments.

7. Five years of austerity and suffering by the Greek people have all been for naught, as the entire euro system is untenable, the debt cannot be paid and the simulacra reforms did nothing to change the power structure or the corrupt, dysfunctional status quo in the country.

8. To maintain the surface illusion of stability for five years, the Powers That Be tripled the debt, vastly increased the risk of default and the damage a default would unleash, and caused undue suffering above and beyond the costs of default and a return to a national currency–a re-set that, if undertaken when it became clear there was no way the debt could be paid in 2010, would already be over and done.

This re-set, while painful in the short-term, is the only mechanism available to force reforms on a self-serving kleptocracy and rid the economy of a dependence on unsustainable credit expansion.

This much-needed re-set to an economy that serves the many rather than the few is what the Powers That Be are so fearful of, for it is the few who garner most of the gains of a corrupt, fully financialized neofeudal system and it is these few who fund the election campaigns of the politicos who are so desperate to maintain the perquisites of the Financial Nobility.

Austerity is meted out to debt-serfs while those at the top transfer tens of billions to their private accounts.

There are variations of this basic flow of income from serfs to the nobility, of course; stock market bubbles are inflated by authorities, insiders sell, sell, sell as credulous banana merchants and wage-earners buy, and then when the bubble bursts, these same authorities ban selling by the small-fry bagholders.

But this is not real stability; it is a brittle simulacrum of stability, an illusion that has required the status quo to pursue extremes of policy and debt that are intrinsically incapable of yielding stability.

In effect, the status quo has greatly increased the system’s vulnerability, fragility and brittleness–the necessary conditions for catastrophic collapse–all in the name of maintaining a completely bogus facade of stability for a few more years.

 

 

 

 

 

Brazil’s Economy Just Imploded

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The latest Keynesian success story…

Zero Hedge   December 29, 2014

China may have mastered the art of fabricating economic data to a level unmatched by anyone except the US Department of Labor, but its derivative countries have much to learn. And none other more so than one of China’s favorite sources of commodities over the past decade: Brazil. It is here that things are going from worse to catastrophic, as disclosed in today’s update of Brazil’s fiscal picture.

Here are the disturbing facts showing that behind the world’s propaganda growth facade, it is all hollow: Brazil’s consolidated public sector primary fiscal balance, which posted a significantly worse than expected R$8.1bn primary deficit in November driven by the R$6.7bn deficit of the Central Government,dipped into negative territory: -0.18% of GDP, driven by the significant deterioration of the Central Government finances.

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USA Today: Is a 1987-type Market Crash 37 Days Away?

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Matt Krantz
USA Today

April 2, 2014

Image: Vimeo

Investors marveling at the striking similarities of the bull market today to the one that ended in 1987 are hoping history doesn’t repeat itself.

 

If it does, the market could be in some serious trouble in 37 trading days. In 37 trading days, the ongoing bull market would be 1,311 trading days old, says Jim Paulsen of Wells Capital Management. That is a scary date because it was on the 1,311 trading day after the start of the 1982 bull market that the Standard & Poor’s 500 suffered its biggest one-day crash in history on Oct. 19, 1987. That crash snuffed out what had been a powerful market rally starting in 1982.

Normally these kinds of things are just market oddities. But investors are taking this one seriously since there are such strong similarities with the 1982 bull market and the one the market is currently in. For instance, the current bull run has marked a 175% rally from the low, which is where the 1982 bull was at this point in its run, Paulsen says.

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Corporate Interests Behind Ukraine Putsch

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JP Sottile
consortiumnews.com

March 29, 2014

In many ways, the farmland of Ukraine was the backbone of the USSR. Its “fertile black soil” generated over a quarter of the USSR’s agriculture. It exported “substantial quantities” of food to other republics and its farms generated four times the output of “the next-ranking republic.”

In many ways, the farmland of Ukraine was the backbone of the USSR. Its “fertile black soil” generated over a quarter of the USSR’s agriculture. It exported “substantial quantities” of food to other republics and its farms generated four times the output of “the next-ranking republic.”

On Jan. 12, a reported 50,000 “pro-Western” Ukrainians descended upon Kiev’s Independence Square to protest against the government of President Viktor Yanukovych. Stoked in part by an attack on opposition leader Yuriy Lutsenko, the protest marked the beginning of the end of Yanukovych’s four year-long government.

That same day, the Financial Times reported a major deal for the U.S. based agri-business titan of Cargill.

Despite the turmoil within Ukrainian politics after Yanukovych rejected a major trade deal with the European Union just seven weeks earlier, Cargill was confident enough about the future to fork over $200 million to buy a stake in Ukraine’s UkrLandFarming. According to Financial Times, UkrLandFarming is the world’s eighth-largest land cultivator and second biggest egg producer. And those aren’t the only eggs in Cargill’s increasingly-ample basket.

On Dec. 13, Cargill announced the purchase of a stake in a Black Sea port. Cargill’s port at Novorossiysk — to the east of Russia’s strategically significant and historically important Crimean naval base — gives them a major entry-point to Russian markets and adds them to the list of Big Ag companies investing in ports around the Black Sea, both in Russia and Ukraine.

Cargill has been in Ukraine for over two decades, investing in grain elevators and acquiring a major Ukrainian animal feed company in 2011. And, based on its investment in UkrLandFarming, Cargill was decidedly confident amidst the post-EU deal chaos. It’s a stark juxtaposition to the alarm bells ringing out from the U.S. media, bellicose politicians on Capitol Hill and perplexed policymakers in the White House.

It’s even starker when compared to the anxiety expressed by Morgan Williams, President and CEO of the U.S.-Ukraine Business Council — which, according to its website, has been “Promoting U.S.-Ukraine business relations since 1995.” Williams was interviewed by the International Business Times on March 13 and, despite Cargill’s demonstrated willingness to spend, he said, “The instability has forced businesses to just go about their daily business and not make future plans for investment, expansion and hiring more employees.”

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Western Looting Of Ukraine Has Begun

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Paul Craig Roberts
March 30, 2014

It is now apparent that the “Maiden protests” in Kiev were in actuality a Washington organized coup against the elected democratic government. The purpose of the coup is to put NATO military bases on Ukraine’s border with Russia and to impose an IMF austerity program that serves as cover for Western financial interests to loot the country. The sincere idealistic protesters who took to the streets without being paid were the gullible dupes of the plot to destroy their country.

Politically Ukraine is an untenable aggregation of Ukrainian and Russian territory, because traditional Russian territories were stuck into the borders of the Ukraine Soviet Republic by Lenin and Khrushchev. The Crimea, stuck into Ukraine by Khrushchev, has already departed and re-joined Russia. Unless some autonomy is granted to them, Russian areas in eastern and southern Ukraine might also depart and return to Russia. If the animosity displayed toward the Russian speaking population by the stooge government in Kiev continues, more defections to Russia are likely.

The Washington-imposed coup faces other possible difficulties from what seems to be a growing conflict between the well-organized Right Sector and the Washington-imposed stooges. If armed conflict between these two groups were to occur, Washington might conclude that it needs to send help to its stooges. The appearance of US/NATO troops in Ukraine would create pressure on Putin to occupy the remaining Russian speaking parts of Ukraine.

Before the political and geographical issues are settled, the Western looting of Ukraine has already begun. The Western media, doesn’t tell any more truth about IMF “rescue packages” than it does about anything else. The media reports, and many Ukrainians believe, that the IMF is going to rescue Ukraine financially by giving the country billions of dollars.

Ukraine will never see one dollar of the IMF money. What the IMF is going to do is to substitute Ukrainian indebtedness to the IMF for Ukrainian indebtedness to Western banks. The IMF will hand over the money to the Western banks, and the Western banks will reduce Ukraine’s indebtedness by the amount of IMF money. Instead of being indebted to the banks, Ukraine will now be indebted to the IMF.

Now the looting can begin. The IMF loan brings new conditions and imposes austerity on the Ukrainian people so that the Ukraine government can gather up the money with which to repay the IMF. The IMF conditions that will be imposed on the struggling Ukraine population will consist of severe reductions in old-age pensions, in government services, in government employment, and in subsidies for basic consumer purchases such as natural gas. Already low living standards will plummet. In addition, Ukrainian public assets and Ukrainian owned private industries will have to be sold off to Western purchasers.

Additionally, Ukraine will have to float its currency. In a futile effort to protect its currency’s value from being driven very low (and consequently import prices very high) by speculators ganging up on the currency and short-selling it, Ukraine will borrow more money with which to support its currency in the foreign exchange market. Of course, the currency speculators will end up with the borrowed money, leaving Ukraine much deeper in debt than currently.

The corruption involved is legendary, so the direct result of the gullible Maiden protesters will be lower Ukrainian living standards, more corruption, loss of sovereignty over the country’s economic policy, and the transfer of Ukrainian public and private property to Western interests.

If Ukraine also falls into NATO’s clutches, Ukraine will also find itself in a military alliance against Russia and find itself targeted by Russian missiles. This will be a tragedy for Ukraine and Russia as Ukrainians have relatives in Russia and Russians have relatives in Ukraine. The two countries have essentially been one for 200 years. To have them torn apart by Western looting and Washington’s drive for world hegemony is a terrible shame and a great crime.

The gullible dupes who participated in the orchestrated Maiden protests will rue it for the rest of their lives.

When the protests began, I described what the consequences would be and said that I would explain the looting process. It is not necessary for me to do so. Professor Michel Chossudovsky has explained the IMF looting process along with much history here:

One final word. Despite unequivocal evidence of one country after another being looted by the West, governments of indebted countries continue to sign up for IMF programs. Why do governments of countries continue to agree to the foreign looting of their populations? The only answer is that they are paid. The corruption that is descending upon Ukraine will make the former regime look honest.

 

Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments. His internet columns have attracted a worldwide following. His latest book, The Failure of Laissez Faire Capitalism and Economic Dissolution of the West is now available.

HSBC imposes restrictions on large cash withdrawals

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BBC News
January 26, 2014

 

HSBC's latest rule follows a worldwide trend towards capitol controls by major banks. Credit: ell-r-brown via Flickr

HSBC’s latest rule follows a worldwide trend towards capitol controls by major banks. Credit: ell-r-brown via Flickr

 

Some HSBC customers have been prevented from withdrawing large amounts of cash because they could not provide evidence of why they wanted it, the BBC has learnt.

 

Listeners have told Radio 4′s Money Box they were stopped from withdrawing amounts ranging from £5,000 to £10,000.

 

HSBC admitted it has not informed customers of the change in policy, which was implemented in November.

 

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Financial Times: Demand Physical Gold Because Paper Price Manipulation Will End “Catastrophically”

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Tyler Durden
Zero Hedge

January 25, 2014

What have we done: after a series of reports in late 2012 in which we showed, with no ambiguity, that not only might the Bundesbank’s offshore held gold be severely “diluted” (follow our 2012 exposes on German gold here, here, here, and here), but that on at least one occassion, the Fed and the Bank of England conspired against the Buba in returning subpar quality gold, the Bundesbank shocked everyone in early January 2013 when it announced it would repatriate 300 tons of gold helt in New York and all of its 374 tons of gold held in Paris.

As many have said, if you don't actually hold gold, you don't own it.

As many have said, if you don’t actually hold gold, you don’t own it.

But convincing the Bundebsbank to demand delivery was peanuts compared to changing the tune of the Financial Times – that bastion of fiat “money”, and where the word gold is mocked and ridiculed, and those who see the daily improprieties in the gold market as nothing but “conspiracy theorists” – to say the magic words: “Learn from Buba and demand delivery for true price of gold”, adding that “one day the ties that bind this pixelated gold may break, with potentially catastrophic results.”

In other words, precisely what we have been saying since the beginning.

Welcome to the ‘conspiracy theorist’ club, boys.

From the FT’s Neil Collins: “Learn from Buba and demand delivery for true price of gold: One day the ties that bind the actual and the traded commodity will snap:

A year ago the Bundesbank announced that it intended to repatriate 700 tons of Germany’s gold from Paris and New York. Although a couple of jumbo jets could have managed the transatlantic removal, it made security sense to ship the load in smaller consignments. Just how small, and over how long, has only just become apparent.

Last month Jens Weidmann, Bundesbank president, admitted that just 37 tons had arrived in Frankfurt. The original timescale, to complete the transfer by 2020, was leisurely enough, but at this rate it would take 20 years for a simple operation. Well, perhaps not so simple. While he awaits delivery, Herr Weidmann is welcome to come and look through the bars in the Federal Reserve’s vaults, but the question is: whose bars are they?

In the “armchair farmer” fraud you are told: “Look, this is your pig, in the sty.” It works until everyone wants physical delivery of their pig, which is why Buba’s move last year caused such a stir. After all nobody knows whether there are really 260m ounces of gold in Fort Knox, because the US government won’t let auditors inside.

The delivery problem for the Fed is a different breed of pig. The gold market is far more than exchanging paper money for precious metal. Indeed the metal seems something of a sideshow. In June last year the average volume of gold cleared in London hit 29m ounces per day. The world’s mines are producing 90m ounces per year. The traded volume was many times the cleared volume.

The paper gold in the London Bullion Market takes the familiar forms that bankers have turned into profit machines: futures, options, leveraged trades, collateralised obligations, ETFs . . . a storm of exotic instruments, each of which is carefully logged, cross-checked and audited.

Or perhaps not. High-flying traders find such backroom work tedious, and prefer to let some drone do it, just as they did with those money-market instruments that fuelled the banking crisis. The drones will have full control of the paper trail, won’t they? There’s surely no chance that the Fed’s little delivery difficulty has anything to do with the cat’s-cradle of pledges based on the gold in its vaults?

John Hathaway suspects there is. He worries about all the paper (and pixels) linked to gold. He runs the Tocqueville gold fund (the clue is in the name) and doesn’t share the near-universal gloom of London’s gold analysts, who a year ago forecast an average $1700 for 2013. It is currently $1,260.

As has been remarked here before, forecasting the price is for mugs and bugs. But one day the ties that bind this pixelated gold may break, with potentially catastrophic results. So if you fancy gold at today’s depressed price, learn from Buba and demand delivery.

 

 

Obamacare falling apart at the seams: Indiana moves to nullify healthcare law

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Michael Lotfi
benswann.com

January 20, 2014

The state legislatures of Oklahoma, Georgia, South Carolina, Tennessee and now Indiana have all taken steps to nullify the federal healthcare law.

Tenth Amendment Center national communications director Mike Maharrey said that this could create a formidable bloc, pulling the rug out from under the already flailing federal act.

“If five states pass something like this, they’re going to be paying attention,” he said. “And if ten or fifteen do it? It’s game over for Obamacare.”

Indiana state Rep. Timothy Harman (R) along with two co-authors have introduced legislation which would virtually nullify Obamcare within the state of Indiana if passed.

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Germany Has Recovered A Paltry 5 Tons Of Gold From The NY Fed After One Year

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Zero Hedge

January 20, 2014

On December 24, we posted an update on Germany’s gold repatriation process: a year after the Bundesbank announced its stunning decision, driven by Zero Hedge revelations, to repatriate 674 tons of gold from the New York Fed and the French Central Bank, it had managed to transfer a paltry 37 tons.

 

This amount represents just 5% of the stated target, and was well below the 84 tons that the Bundesbank would need to transport each year to collect the 674 tons rateably over the 8 year interval between 2013 and 2020. The release of these numbers promptly angered Germans, and led to the rise of numerous allegations that the reason why the transfer is taking so long is that the gold simply is not in the possession of the offshore custodians, having been leased, or worse, sold without any formal or informal announcement.

However, what will certainly not help mute “conspiracy theorists” is today’s update from today’s edition of Die Welt, in which we learn that only a tiny 5 tons of gold were sent from the NY Fed. The rest came from Paris.

As Welt states, “Konnten die Amerikaner nicht mehr liefern, weil sie die bei der Federal Reserve of New York eingelagerten gut 1500 Tonnen längst verscherbelt haben?”

Or, in English, did the US sell Germany’s gold? Maybe. The official explanation was as follows: “The Bundesbank explained [the low amount of US gold] by saying that the transports from Paris are simpler and therefore were able to start quickly.” Additionally, the Bundesbank had the “support” of the BIS “which has organized more gold shifts already for other central banks and has appropriate experience – only after months of preparation and safety could transports start with truck and plane.” That would be the same BIS that in 2011 lent out a record 632 tons of gold…

Going back to the main explanation, we wonder: how exactly is a gold transport “simpler” because it originates in Paris and not in New York? Or does the NY Fed gold travel by car along the bottom of the Atlantic, and is French gold transported by a Vespa scooter out of the country?

Supposedly, there was another reason: “The bullion stored in Paris already has the elongated shape with bevelled edges of the “London Good Delivery” standard. The bars in the basement of the Fed on the other hand have a previously common form. They will need to be re-melted [to LGD standard]. And the capacity of smelters are just limited.”

So… New York Fed-held gold is not London Good Delivery, and there is a bottleneck in re-melting capacity? You don’t say…

Furthermore, Welt goes on to “debunk” various “conspiracy websites” that the reason why the gold is being melted is not to cover up some shortage (and to scrap serial numbers), but that the gold is exactly the same gold as before. Finally, to silences all sceptics, the Bundesbank says that “there is no reason for complaint – the weight and purity of the gold bars were consistent with the books match.” In conclusion, Welt reports that in 2014 “larger transport volumes” can be expected from New York: between 30 and 50 tons.

Here we would be remiss to not point out that the reason why the German people and the Bundesbank have every reason to be sceptical is that as Zero Hedge reported exclusively in November 2012, before the Buba’s shocking repatriation announcement and was the reason for the escalation in lack of faith between central banks, it was the Fed and the Bank of England who in 1968 knowingly sent Germany “bad delivery” gold.  Which is why we have a feeling that the pace of gold transportation will certainly not accelerate until such time as the German people much more vocally demand an immediate transit of all their gold held at the New York Fed: after all, it’s there right – surely the Bundesbank can be trusted to melt the gold (if any exists of course) into London Good Delivery or whatever format it wants.

Unless of course, the gold isn’t there…

From November 9, 2012:

Bank Of England To The Fed: “No Indication Should, Of Course, Be Given To The Bundesbank…”

Over the past several years, the German people, for a variety of justified reasons, have expressed a pressing desire to have their central bank perform a test, verification, validation or any other assay, of the official German gold inventory, which at 3,395 tonnes is the second highest in the world, second only to the US. We have italicized the word official because this representation is merely on paper: the problem arises because no member of the general population, or even elected individuals, have been given access to observe this gold. The problem is exacerbated when one considers that a majority of the German gold is held offshore, primarily in the vaults of the New York Fed, and at the Bank of England – the two historic centres of central banking activity in the post World War 2 world.

Recently, the topic of German gold resurfaced following the disclosure that early on in the Eurozone creation process, the Bundesbank secretly withdrew two-thirds of its gold, or 940 tons, from London in 2000, leaving just 500 tons with the Bank of England. As we made it very clear, what was most odd about this event, is that the Bundesbank did something it had every right to do fully in the open: i.e., repatriate what belongs to it for any number of its own reasons – after all the German central bank is only accountable to its people (or so the myth goes), in deep secrecy. The question was why it opted for this stealthy transfer.

This immediately prompted rampant speculation within various media outlets, the most fanciful of which, of course, being that the Bundesbank never had any gold to begin with and has been masking the absence all along. The problem with such speculation is that, while it may be 100% correct and accurate, there has been not a shred of hard evidence to prove it. As a result, it is merely relegated to the echo chamber periphery of “serious media” whose inhabitants are already by and large convinced that all gold in the world is tungsten, lack of actual evidence to validate such a claim be damned (just like a chart of gold spiking or plunging is not evidence that a central bank signed the trade ticket, ordering said move), and in the process delegitimizing any fact-based investigations that attempt to debunk, using hard evidence, the traditional central banker narrative that the gold is there and accounted for.

And hard evidence, or better yet a paper trail of inconsistencies, is absolutely paramount when juxtaposing the two most powerful forces of our times: i) the central banking-led status quo (which is de facto the banker-led oligarchy whose primary purpose in the past several centuries has been to accumulate as much as possible of the hard asset-based fruits of people’s labour, who toil in exchange for “money” created out of thin air – a process which could be described as not quite voluntary slavery, but the phrase would certainly suffice), and ii) “everyone else”, especially when “everyone else” still believes in the supremacy of democratic forces, accountability, and an impartial legal system (three pillars of modern society which over the past 4 years we have experienced time and again have been nothing but mirages). Because without hard evidence, not only is the case of the people against central bankers non-existent, even if conducted in a kangaroo court co-opted by the banker-controlled status quo, it becomes laughable with every iteration of progressively more unsubstantiated accusations against the central banking cartels.

Finally, when it comes to cold, hard facts, which expose central banks in misdeed, even the great central banks have to be silent, as otherwise the overt perversion of justice will blow up the mirage that modern society lives in a democratic, laws-based world will be torn upside down.

And while others engage in click-baiting using grotesque hypotheses of grandeur without any actual investigation, reporting or error and proof-checking to build up hype and speculation, which promptly fizzles and in the process desensitizes the general public and those actually undecided and/or on the fences about what truly goes on behind the scenes, Zero Hedge travelled (metaphorically) in space – to London, or specifically the Bank of England Archives – and in time, to May 1968 to be precise.

While there we dug up a certain memo, coded C43/323 in the BOE archives, official title “GOLD AND FOREIGN EXCHANGE OFFICE FILE: FEDERAL RESERVE BANK OF NEW YORK (FRBNY) – MISCELLANEOUS”, dated May 31, 1968, written by a certain Mr. Robeson addressed to the BOE’s Roy Bridge as well as its Chief Cashier, and whose ultimate recipient is Charles Coombs who at the time was the manager of the open market account at the Fed, responsible for Fed operations in the gold and FX markets.

This memo, more than any of the other spurious and speculative accusation about Buba’s golden hoard, should disturb German citizens, and of course the Bundesbank (assuming it was not already aware of its contents), as the memo lays out, without any shadow of doubt, that the BOE and the Fed, effectively conspired to feed the Bundesbank due gold bars that were of substantially subpar quality on at least one occasion in the period during the Bretton-Woods semi-gold standard (which ended with Nixon in August 1971).

The facts:  

At least two central banks have conspired on at least one occasion to provide the Bundesbank with what both banks knew was “bad delivery” gold – the convertible reserve currency under the Bretton Woods system, or in other words, to defraud – amounting to 172 barsThe “bad delivery” occurred even as official gold refiners had warned that the quality of gold emanating from the US Assay Office was consistently below standard, and which both the BOE and the Fed were aware of. Instead of addressing the issue of declining gold quality and purity, the banks merely covered up the refiners’ complaints 

It is this that the Bundesbank, the German government, and the German people should be focusing on. If in the process this means completely ridiculing the Buba’s “she doth protest too much” defense strategy that what is happening in the media is a “phantom debate” as per Andreas Dobret’s recent words, so be it. In fact, one may be well advised to ignore anything Buba has said on this matter, because in attempting to hyperbolize the matter out of irrelevancy, the Buba is now cornered and will have no choice now but to explain just what the true gold content of the gold even in its possession is, let alone that which is allocated to the Buba account 50 feet below sea level, underneath the infamous building on Liberty 33.

Full May 1968 memo from the BOE to the NY Fed: highlights ours:

MR. BRIDGE

THE CHIEF CASHIER

U.S. Assay Office Gold Bars

1.  We have from time to time had occasion to draw the Americans’ attention of thepoor standards of finish of U.S. Assay Office bars. In addition in 1961 we passed on to them comments from Johnson Matthey to the effect that spectrographic examination did not support the claimed assay on one bar they had so tested(although they would not by normal processes have challenged the assayand that impurities in the bar included iron which caused some material to be retained on the sides of crucible after pouring.

2. Recently, Johnson Matthey have put 172 “bad delivery” U.S. Assay Office bars into good delivery form for account of the Deutsche Bundesbank. These bars formed part of recent shipments by the Federal Reserve Bank to provide gold in London in repayment of swaps with the Bundesbank. The out-turn of the re-melting showed a loss in fine ounces terms four times greater than the gross weight loss. Asked to comment Johnson Matthey have indicated verbally that:-

(a) the mixing of “melt” bars of differing assays in one “pot” could produce a result which might be a contributing factor to a heavier loss in fine weight but they did not think this would be substantial ;

(b) a variation of .0001 in assay between different assayers is an extremely common phenomenon;

(c) over a long period of years they had had experience of unsatisfactory U.S. assays

3. It is not, however, possible to say that the U.S. assays were at fault because Johnson Matthey did not test any of the individual bars before putting them into the pot.

4. The Federal Reserve Bank have informed the Bundesbank that adjustments for differences in weight and refining charges will be reimbursed by the U.S.Treasury.

5. No indication should, of course, be given to the Bundesbank, or any other central bank holder of U.S. bars, as to the refiner’s views on them. The peculiarity of the out-turn will be known to the Bundesbank: it has so far occasioned no comment.

6. We should draw the attention of the Federal to the discrepancy in this (and any similar subsequent such) result and add simply that the refiners have made no formal comment but have indicate that, although very small differences in assay are not uncommon, their experience with U.S. Assay Office bars has not been satisfactory.

7. We hold 3,909 U.S. Assay Office bars for H.M.T. in London (in addition to the New York holding of 8,630 bars). After the London gold market was reopened in 1954 we test assayed the bars of certain assayers to ensure that pre-war standards were being maintained. It might be premature to set up arrangements now for sample test assays of U.S. Assay Office bars but if it appeared likely that the present discontent of the refiners might crystallise into formal complain we should certainly need to do this.  In the meantime I would recommend no further action.

31st May 1968

P.W.R.R.

To summarize: Bank of England discovers discrepancies with US Assay Office gold bars, notifies the NY Fed that its gold bars have major “bad delivery” issues, but, and this is the punchline, on this occasion, we’ll keep it quiet, because the Bundesbank got these bars. This is merely one documented assay occasion: one can imagine that of the hundreds of thousands of gold bars in official circulation, the “good delivery” quality of bars outside of the US, and perhaps BOE, official holdings has progressively declined over the decades of Bretton Woods. One can also only imagine what has happened to all those “good delivery” bars currently held by the Fed as custodian at the NY Fed. Literally: imagine. Because there is no way to check what the real gold consistency of these gold bars is, and whether the refiners found ongoing future inconsistencies with “good delivery” standards of bars handed off to other “non-core” central banks. And, yes, without further evidence the above is merely speculation.

As to the remaining relevant facts: the US ran out of good delivery gold in March 1968 and only had coin bars remaining. Which is why it closed the gold pool and went to a two-tier price system. The Bundesbank went on to cover some of the outstanding gold debts of the Fed to the gold pool. Subsequently, the US then did several deals with the BOC to get a substantial amount of gold to pay back the Bundesbank which was sent over to England from March until June 1968. One can, again, only speculate on the quality of said gold. The Fed then created unsettled accounts to account for these transfers between itself and the Buba.

In light of the above facts and evidence, one can see why the Buba is doing all in its power to avoid the spotlight being shone on the purity of its gold inventory: after all the last thing the German central banks would want is someone to go through the publicly available archived literature, to put two and two together, and figure out that it does not take one massive “rehypothecation” (see “to Corzine”) event for German gold credibility to be impaired: all it takes is death from a thousand micro dilutions over the decades to get the same end result. Because chipping away one ounce here, one ounce there for years and years and years, ultimately adds up to a lot.

We eagerly look forward to the Buba’s next iteration of self-defence. We can only hope that this one does not include a reference to a “phantom debate”, to “East German terrorist Simon Gruber” or to Goldfinger, as it will merely further destroy any remaining credibility the Bundesbank may have left in this, or any other, matter.

 

 

Stocks Slide as Bernanke Announces More QE Infinity

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JeeYeon Park
cnbc.com

June 19, 2013

Stocks accelerated their selloff in the final hour of trading to end near session lows Wednesday, after the Federal Reserve said it will maintain its bond-buying program, though Chairman Ben Bernanke hinted that the FOMC plans to moderate purchases later this year.

“They don’t tie themselves officially into anything but it’s clearly what they’re going to do,” said Jim Paulsen, chief investment strategist at Wells Capital Management. “I think he’s more clearly said today than at any other time that he’s going to taper before the end of the year, and there’s a possibility he could be done by the middle of next year.”

The Dow Jones Industrial Average tumbled more than 200 points, wiping out most of its gains from the last two sessions. The blue-chip index logged its seventh-straight triple-digit move.

 

Read more

Obama’s Super Secret Treaty Which Will Push The Deindustrialization Of America Into Overdrive

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Michael Snyder
theeconomiccollapseblog.com

June 3rd, 2013

Did you know that Barack Obama has been secretly negotiating the most important trade agreement since the formation of the World Trade Organization?  Did you know that this agreement will impose very strict Internet copyright rules, ban all “Buy American” laws, give Wall Street banks much more freedom to trade risky derivatives and force even more domestic manufacturing offshore?  If you have not heard about this treaty, don’t feel bad.  Obama has refused to even give Congress a copy of the draft agreement and he has banned members of Congress from attending the negotiations.

The plan is to keep this treaty secret until the very last minute and then to railroad it through Congress and have it signed into law by October.  The treaty is known as “the Trans-Pacific Partnership”, and the nations that are reported to be involved in the development of this treaty include the United States, Canada, Japan, South Korea, Australia, New Zealand, Chile, Peru, Brunei, Singapore, Vietnam and Malaysia.  Opponents of this treaty refer to it as “the NAFTA of the Pacific”, and if it is enacted it will push the deindustrialization of America into overdrive.

The “one world” economic agenda that Barack Obama has been pushing is absolutely killing the U.S. economy.  As you will see later in this article, we are losing jobs and businesses at an astounding pace.  And each new “free trade” agreement makes things even worse.

For example, just check out the impact that the recent free trade agreement that Obama negotiated with South Korea is having on us

–A 10 percent decline of U.S. exports to Korea –The U.S. trade deficit with Korea has climbed 37 percent –U.S. auto industry has been crippled –Loss of U.S. control where international trade, banking and finance is concerned –A projected 159,000 jobs will be lost

Wait a second – I though that “free trade” agreements were actually supposed to increase exports.

So why have they declined by 10 percent?

Did someone make a really bad deal?

And of course we have all seen the economic devastation that NAFTA has wrought.

When NAFTA was pushed through Congress in 1993, the United States actually had a trade surplus with Mexico of 1.6 billion dollars.  By 2010, we had a trade deficit with Mexico of 61.6 billion dollars.

And “free trade” with China has turned out to be a complete and total nightmare as well.

Back in 1985, our trade deficit with China was approximately 6 million dollars (million with a little “m”) for the entire year.

In 2012, our trade deficit with China was 315 billion dollars.  That was the largest trade deficit that one nation has had with another nation in the history of the world.

But instead of learning from the mistakes of the past, Barack Obama is pressing for more “free trade” agreements.

The New York Times is calling the Trans-Pacific Partnership “the most significant international commercial agreement since the creation of the World Trade Organization in 1995“.  It is reportedly going to include a whole host of provisions which would never be able to get through Congress on their own.  Even though this treaty will affect all of our daily lives, the Obama administration is keeping this treaty a total secret.  In fact, Obama won’t even show it to Congress even though members of Congress have asked repeatedly to see it…

The agreement, under negotiation since 2008, would set new rules for everything from food safety and financial markets to medicine prices and Internet freedom. It would include at least 12 of the countries bordering the Pacific and be open for more to join. President Obama has said he wants to sign it by October.

Although Congress has exclusive constitutional authority to set the terms of trade, so far the executive branch has managed to resist repeated requests by members of Congress to see the text of the draft agreement and has denied requests from members to attend negotiations as observers — reversing past practice.

While the agreement could rewrite broad sections of nontrade policies affecting Americans’ daily lives, the administration also has rejected demands by outside groups that the nearly complete text be publicly released.

So exactly who in the world does this guy think that he is?  Why won’t Obama let us know exactly what is in this treaty?

Fortunately, there have been a few leaks.  One thing that we have discovered is that this new treaty would reportedly ban all “Buy American laws“.

That certainly would not be popular if it got out.

And do you remember SOPA?

The American people wanted nothing to do with the very strict Internet copyright provisions of SOPA and loudly expressed their displeasure to members of Congress.

Unfortunately, now the provisions of SOPA are back.  It is being reported that most of the provisions of SOPA have been quietly inserted into this treaty.  If this treaty is enacted, those provisions will become law and the American people will not be able to do anything about it.

And according to the New York Times, there are all sorts of other disturbing things that have been slipped into the treaty…

And yet another leak revealed that the deal would include even more expansive incentives to relocate domestic manufacturing offshore than were included in Nafta — a deal that drained millions of manufacturing jobs from the American economy.

The agreement would also be a boon for Wall Street and its campaign to water down regulations put in place after the 2008 financial crisis. Among other things, it would practically forbid bans on risky financial products, including the toxic derivatives that helped cause the crisis in the first place.

 

Are you starting to understand why the Obama administration is keeping this treaty such a secret?

If the details of this treaty were revealed to the American people right now, it would create such an uproar that Congress would never approve this treaty.

So please share this article with as many people as you can.  We have got to get the American people educated about this.

Enough damage has already been done to the U.S. economy by “free trade” agreements.  Just consider the following statistics…

-The United States has lost more than 56,000 manufacturing facilities since 2001.

-Back in the year 2000, there were more than 17 million Americans working in manufacturing.  Now there are less than 12 million.

-There are less Americans working in manufacturing today than there was in 1950 even though the population of the country has more than doubled since then.

-According to the Economic Policy Institute, America is losing half a million jobs to China every single year.

-According to Professor Alan Blinder of Princeton University, 40 million more U.S. jobs could be sent offshore over the next two decades if current trends continue. ’ -Today, corporate profits as a percentage of U.S. GDP are at an all-time high, but wages as a percentage of U.S. GDP are near an all-time low.

-Without enough good jobs, more Americans are becoming dependent on the government.  If you can believe it, the number of Americans on food stamps has gone from about 17 million in the year 2000 to more than 47 million today.

-Overall, the United States has run a trade deficit of more than 8 trillion dollars with the rest of the world since 1975.

 

And things continue to get even worse.  The Institute for Supply Management manufacturing index declined to 49.0 in May.  Any reading below 50 indicates contraction.

That was the lowest reading that we have seen since June 2009.  Just like most of the rest of the world, we are rapidly heading toward another major economic downturn.

And if you want a perfect visual example of what deindustrialization is doing to America, just look at the city of Detroit.

It was once one of the greatest manufacturing cities in the history of the world, but now it is a rotting, decaying, festering hellhole.

According to the New York Times, there are now approximately 70,000 abandoned buildings in Detroit, and at this point the city is so broke that there is talk that the female giraffe at the Detroit Zoo could be sold off to help pay the bills.

For much more on how deindustrialization is ripping the guts out of the U.S. economy, please see the following articles…

1) “55 Reasons Why You Should Buy Products That Are Made In America

2) “40 Ways That China Is Beating America

3) “Show This To Anyone That Believes That ‘Things Are Getting Better’ In America

4) “10 Amazing Charts That Demonstrate The Slow, Agonizing Death Of The American Worker

5) “22 Stats That Show How The Emerging One World Economy Is Absolutely Killing American Workers

 

What Barack Obama is trying to do is a mind blowing mistake.

The “one world” economic agenda that he is pursuing is destroying the American worker and the American middle class.

U.S. workers are being thrown into a global labour pool with workers on the other side of the planet that live in countries where it is legal to pay slave labour wages.

Do you want to directly compete with a worker on the other side of the globe that is doing your job for a dollar an hour with no benefits?

If not, you need to stand up and make your voice be heard.

There is no way in the world that American workers should have to compete for jobs with workers making slave labor wages in communist China.

What we desperately need are some red-blooded economic patriots to arise and to tell both political parties that we do not want this “one world” economic agenda.

 

 

David Stockman: “The Error Of Central Banking Has Become Universal”

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zerohedge.com

May 30, 2013

In the old normal (“when we had an honest Fed,” under Volcker), David Stockman explains to CNBC’s Rick Santelli, “the market could judge what Congress and the White House was doing and decide where the risk/reward equation was and how to price the bond, the note, the bills,” but in the new normal, “today, the market is entirely rigged.” Stockman is no fan of deficits and as he notes “is no fan of money-printing,” pointing out that “it’s not honest,” for the Fed to fund these chronically growing deficits and “created an unsustainably dangerous financial system.”

In the brief interview, Stockman (of The Great Deformation fame) sums it up perfectly to a just-as-concerned Santelli, when he notes, “the error of central banking has become universal.” We’re taxing the futures generations, he concludes, “they’re going to thank you for the massive disaster that was handed to them.” The honesty will never come…

“You have both parties in the military complex and we’re still spending billions for defence.

So the honesty will be in the raising of taxes.

The honesty will come when you tell the middle class you’re not going to get a tax cut – you’re going to pay more.

Then they will wake up.

Then they will march on Washington and demand that we do something about the giant programs that are drifting today because everybody thinks the Fed will take care of the debt.”

 

Watch the CBS Report filed here…

 

 

 

Washington Signals Dollar Deep Concerns

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Paul Craig Roberts Infowars.com May 19, 2013

Over the past month there has been a statistically improbable concurrence of events that can only be explained as a conspiracy to protect the dollar from the Federal Reserve’s policy of Quantitative Easing (QE).

Quantitative Easing is the term given to the Federal Reserve’s policy of printing 1,000 billion new dollars annually in order to finance the US budget deficit by purchasing US Treasury bonds and to keep the prices high of debt-related derivatives on the “banks too big to fail” (BTBF) balance sheets by purchasing mortgage-backed derivatives. Without QE, interest rates would be much higher, and values on the banks’ balance sheets would be much lower.

Quantitative Easing has been underway since December 2008. During these 54 months, the Federal Reserve has created several trillion new dollars with which the Fed has monetized the same amount of debt.

 

One result of this policy is that most real US interest rates are negative. Another result is that the supply of dollars has outstripped the world’s demand for dollars.

These two results are the reason that the Federal Reserve’s policy of printing money with which to purchase Treasury bonds and mortgage backed derivatives threatens the dollar’s exchange value and, thus, the dollar’s role as world reserve currency.

To be the world reserve currency means that the dollar can be used to pay any and every country’s oil bills and trade deficit. The dollar is the medium of international payment.

This is very helpful to the US and is the main source of US power. Because the dollar is the reserve currency, the US can cover its import costs and pay for its cost of operation simply by creating its own paper money.

If the dollar were not the reserve currency, Washington would not be able to finance its wars or continue to run large trade and budget deficits. Therefore, protecting the exchange value of the dollar is Washington’s prime concern if it is to remain a superpower.

The threats to the dollar are alternative monies–currencies that are not being created in enormous quantities, gold and silver, and Bitcoins, a digital currency.

The Bitcoin threat was eliminated on May 17 when the Gestapo Department of Homeland Security seized Bitcoin’s accounts. The excuse was that Bitcoin had failed to register in keeping with the US Treasury’s anti-money laundering requirements.

 

Washington has stifled the threat from other currencies by convincing other large currencies to out-print the dollar. Japan has complied, and the European Central Bank, though somewhat constrained by Germany, has entered the printing mode in order to bail out the private banks endangered by the “sovereign debt crisis.”

That leaves gold and silver. The enormous increase in the prices of gold and silver over the last decade convinced Washington that there are a number of miscreants who do not trust the dollar and whose numbers must not be permitted to increase.

The price of gold rose from $272 an ounce in December 2000 to $1,917.50 on August 23, 2011. The financial gangsters who own and run America panicked. With the price of the dollar collapsing in relation to historical real money, how could the dollar’s exchange rate to other currencies be valid? If the dollar’s exchange value came under attack, the Federal Reserve would have to stop printing and would lose control over interest rates.

The bond and stock market bubbles would pop, and the interest payments on the federal debt would explode, leaving Washington even more indebted and unable to finance its wars, police state, and bankster bailouts.

 

Something had to be done about the rising price of gold and silver.

There are two bullion markets. One is a paper market in New York, Comex, where paper claims to gold are traded. The other is the physical market where personal possession is taken of the metal–coin shops, bullion dealers, jewellery stores.

The way the banksters have it set up, the price of bullion is not set in the markets in which people actually take possession of the metals. The price is set in the paper market where speculators gamble.

This bifurcated market gave the Federal Reserve the ability to protect the dollar from its printing press.

 

On Friday, April 12, 2013, short sales of gold hit the New York market in an amount estimated to have been somewhere between 124 and 400 tons of gold. This enormous and unprecedented sale implies an illegal conspiracy of sellers intent on rigging the market or action by the Federal Reserve through its agents, the BTBF that are the bullion banks.

The enormous sales of naked shorts drove down the gold price, triggering stop-loss orders and margin calls. The attack continued on Monday, April 15, and has continued since.

Before going further, note that there are position limits imposed on the number of contracts that traders can sell at one time. The 124 tons figure would have required 14 traders with no open interest on the exchange to sell all together in the same few minutes 40,000 futures contracts. The likelihood of so many traders deciding to short at the same moment at the maximum permitted is not believable. This was an attack ordered by the Federal Reserve, which is why there is no investigation of the illegality.

Note also that no seller that wanted out of a position would give himself a low price by dumping an enormous amount all at once unless the goal was not profit but to smash the bullion price.

 

Since the April 12-15 attack on the gold price, subsequent attacks have occurred at 2pm Hong Kong time and 2 am New York time. At this time activity is light, waiting on London to begin operating. As William S.Kaye has observed, no entity concerned about profits would choose this time to sell 20,000 to 30,000 futures contracts, but this is what has been happening.

Who can be unconcerned with losing money in this way? Only a central bank that can print it.

Now we come to the physical market where people take possession of bullion instead of betting on paper instruments. Look at this chart from ZeroHedge. 

The demand for physical possession is high, despite the assault on gold that began in 2011, but as the price is set in the non-real paper market, orchestrated short sales, as in the current quarter of 2013, can drive down the price regardless of the fact that the actual demand for gold and silver cannot be met.

 

While the corrupt Western financial press urges people to abandon bullion, everyone is trying to purchase more, and the premiums above the spot price have risen. Around the world there is a shortage of gold and silver in the forms, such as one-ounce coins and ten-ounce bars, that individuals demand.

That the decline in gold and silver prices is an orchestration is apparent from the fact that the demand for bullion in the physical market has increased while naked short sales in the paper market imply a flight from bullion.

What does this illegal manipulation of markets by the Federal Reserve tell us? It tells us that the Federal Reserve sees no way out of printing money in order to support the federal deficit and the insolvent banks. If the dollar came under attack and the Federal Reserve had to stop printing dollars, interest rates would rise. The bond and stock markets would collapse. The dollar would be abandoned as reserve currency. Washington would no longer be able to pay its bills and would lose its hegemony. The world of hubristic Washington would collapse.

 

It remains to be seen whether Washington can prevail over the world demand for gold and silver. Can the dollar remain supreme when offshoring has deprived the US of the ability to cover its imports with exports? Can the dollar remain supreme when the Federal reserve is creating 1,000 billion new ones each year, while the BRICS, China and Japan, China and Australia, and China and Russia are making deals to settle their trade balances without the use of the dollar?

If the consumption-based US economy deprived of consumer income by jobs offshoring takes a further dip down in the third or fourth quarter–a downturn that cannot be masked by phony statistical releases–the federal deficit will rise. What will be the effect on the dollar if the Federal Reserve has to increase its Quantitative Easing?

A perfect storm has been prepared for America. Real interest rates are negative, but debt and money are being created hand over foot. The dollar’s demise awaits the world’s decision how to get out of it. The Federal Reserve can print dollars with which to keep the bond and stock markets high, but the Federal Reserve cannot print foreign currencies with which to keep the dollar afloat.

 

When the dollar goes, Washington’s power goes, which is why the bullion market is rigged. Protect the power. That is the agenda. Is it another Washington over-reach?

Dr. Paul Craig Roberts is the father of Reaganomics and the former head of policy at the Department of Treasury. He is a columnist and was previously the editor of the Wall Street Journal. His latest book, “How the Economy Was Lost: The War of the Worlds,” details why America is disintegrating.

ALERT: All Of The Money In Your Bank Account Could Disappear In A Single Moment

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Michael Snyder Economic Collapse April 4, 2013

What would you do if you logged in to your bank account someday and it showed that you had a zero balance and your bank had no record that you ever had any money in your account?  What would you do if all of the money in your bank account suddenly disappeared in a single moment?  If you had not kept any paper records, which most Americans do not, it would be exceedingly difficult to prove to the bank that you actually had any money in the bank.  If you don’t think that something like this could ever happen in the United States, you might want to think again.  Cyber attacks against major banks in the United States are becoming more powerful and more sophisticated with each passing month.  In fact, major U.S. bank websites have been offline for a total of 249 hours over the past six weeks.

 

And just last month, thousands upon thousands of Chase customers logged into their bank accounts only to discover that their balances had all been reset to zero.  Anyone that would want to cause complete and total economic chaos in the United States could accomplish it very easily by wiping out all of our bank account records.  So please do not keep all of your money in a single bank, and from now on please keep a paper copy of all of your bank account statements.  At some point it is likely that one of these cyber attacks will cause permanent damage to our banking system, and you want to be protected.

The mainstream media has generally been very quiet about the massive cyber attacks against our major banks, but behind the scenes authorities are truly alarmed.  They don’t know how to stop these attacks, and they just keep getting more intense and more sophisticated.

 

Could you imagine how you would feel if you logged in to your bank account and all of your money was gone?  That is exactly what happened to some Chase customers last month.  The following is from a recent CNET article

JP Morgan Chase denied this evening that it had suffered a hack that many customers claimed had suddenly reduced their checking account balances to zero.

After discovering the apparently empty accounts via the Internet or mobile devices, many Chase banking customers turned to Twitter to express their frustration and show screen shots of zero balances. Other users were greeted with messages that their bank account balances were unavailable.

 

But this was most definitely not an isolated incident.  That same article noted that Chase and many of our other large banks have had their websites taken down for extended periods of time lately…

Customers’ suspicions about a possible security breach are natural, with the zero balances appearing less than a week after a massive distributed-denial-of-service attack rendered Chase’s Web sites useless for many hours. Customers trying to use the site’s tools were instead greeted with a note that the site was “temporarily down.”

Hackers have ratcheted up their assaults on financial institutions in recent months, using DDoS attacks to take down Wells Fargo, Bank of America, Chase, Citigroup, HSBC, and others.

 

In fact, as I mentioned above, major U.S. bank websites have been offline for an astounding 249 hours over the last six weeks alone.  The attacks just keep getting larger and bank officials are becoming very alarmed about the power of these cyber attacks.  The following is from an article that was posted on CNBC this week…

Major U.S. bank websites have been offline a total of 249 hours in the past six weeks, perhaps the clearest indication yet that American companies are prime targets in an unrelenting, global cyber conflict.

 

The heavier-than-usual outages are the result of a remarkable, sustained attack that began seven months ago and repeatedly knocks banks offline for hours at a time, frustrating consumers and bank security professionals alike.

“Literally, these banks are just in war rooms, sitting at controls trying to stop (the attacks),” said Avivah Litan, a bank security analyst with Gartner Group, a consulting firm. “The frightening thing is (the attackers) are not using as much resources as they have on call. The attacks could be bigger.”

 

So who is behind these attacks?

Some are blaming Chinese hackers, others believe that Iran is behind the attacks, and yet others are convinced that it is the work of Islamic terrorists.

It is kind of frightening that they cannot positively identify who is behind these attacks.  Whoever it is, they sure do seem to have a tremendous amount of resources and they are very sophisticated.

And in the future, it may not be hackers on the other side of the globe that are attacking our banks.  In fact, if someone wanted to “recapitalize the banks”, all they would have to do is wipe out all of our bank account records (including all backup records).  Suddenly trillions of dollars of “unsecured liabilities” (that is what our bank accounts are) would be wiped out and the banks would suddenly be solvent again.  Anyone that could not produce evidence that they actually had money in the banks would be in a lot of trouble.  It would be the largest single wealth transfer in the history of the world, and it would throw the U.S. economy into utter chaos.  This is a scenario that I am exploring in my new novel which will be coming out later this month.

 

In addition, there is the constant threat that a massive EMP burst could fry all of our electronics (including the banking records), but that is a topic that I have covered in a previous article.

And of course another way that your bank account could be wiped out in a single moment is if the government decides to “legally” steal it.  We just witnessed this happen in Cyprus.  In February, the Central Bank of Cyprus swore that such a thing could never possibly happen, but then one month later it did happen.  The politicians will lie to your face until the very day comes when they steal your money.

Sadly, a very similar thing could easily happen in the United States someday.  As I wrote about yesterday, the big banks are making incredibly reckless bets with our money.  When those bets go bad, our money could very well be used to cover those bets.

 

One way this could be accomplished is by using a practice known as “rehypothecation”.  It sounds complicated, but it really isn’t.  Basically, the banks use money that clients have entrusted to them to cover their own gambling debts.  This is how rehypothecaton is defined by Investopedia

“The practice by banks and brokers of using, for their own purposes, assets that have been posted as collateral by their clients.”

 

An excellent article by Jeff Nielson detailed how this could result in the big banks grabbing our money when their trillions of dollars of reckless bets go bad…

1) Our banking regulators knowingly allow financial institutions to engage in recklessly misleading (if not outright fraudulent) contracts with their clients, through the use of complex “small print” in their account contracts with clients.

 

2) The three largest U.S. “banks” by deposit (JP Morgan, Bank of America, Citigroup) have made bets in their own rigged casino, which total well in excess of $100 trillion, an amount which completely dwarfs their total, combined deposits (and assets).

 

3) A large portion of those bets occur in the $60+ trillion credit default swap market. Pay-outs in these markets can (and do) exceed 300 times the amount of the original bet. It is bets in this market which “blew up” AIG, requiring more than $150 billion in immediate government aid.

 

4) Following the Crash of ’08; these same banks mooched a package of hand-outs, tax-breaks and “guarantees” (i.e. future hand-outs) from the Bush regime in excess of $15 trillion, the last time their gambling debts went bad on them – and all of these banks have been allowed to dramatically increase the total amount of their gambling since then.

 

5) It would take only a minor change in the gambling contracts in which these bankers engage to allow their creditors to seize funds out of ordinary bank accounts.

 

6) The existing language for the bank accounts of these U.S. banks is possibly already so vague (and prejudicial to clients) that it would allow these banks to reinterpret the terms of these bank accounts – and allow rehypothecation to be used to rob the holders of ordinary bank accounts, people who themselves make no “bets” in markets whatsoever. Alternately, customers could be blitzed with an offer for “new and improved” bank accounts, where terms allowing rehypothecation are slipped into the contract, with the  banks knowing that the “regulators” will do nothing to warn account-holders of the gigantic risk they are taking.

 

But we are all covered by deposit insurance, right?

That is what the people of Cyprus thought too.

As we just saw in Cyprus, when there is a “banking crisis” sometimes government steps in and suddenly changes all of the rules overnight even though the vast majority of the population is against it.

Hopefully you can see that no bank account will ever truly be “safe” ever again.

Your money may be safe today, and your money may be there next week, but someday it could disappear in a single moment.

And the general public is definitely starting to lose faith in the banking system.  Google searches for the term “bank run” have been absolutely spiking recently.  Just check out this chart which shows that searches for “bank run” are now the highest that they have ever been.

 

So what should we all do to protect ourselves?

As I mentioned earlier, it is important to not have all of your money in one bank, and from now on you will want to permanently keep paper copies of all of your bank account statements.

Someday you may need those statements in order to prove that you actually had money in the bank.

Our world is becoming increasingly unstable, and at some point financial disaster is going to strike.

By taking prudent precautions now, hopefully you will be able to minimize the damage to your family.

 

 

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IMF Urges Economic Death Blow with Gasoline Carbon Tax

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Infowars.com April 3, 2013

Following the criminal plot by the IMF, the EU and the European Central Bank to steal billions from depositors in Cyprus, the banksters have hatched a new plan to steal trillions, level the economic playing field and force millions into grinding poverty.

 

Watch our Report Filed on our YouTube Channel here…

 

In order to save the earth and pay for social programs supposedly designed to help the victims of our alleged carbon crimes, the IMF says we need to pay an extra $1.40 per gallon in taxes.

“The time has come for subsidy reform and carbon taxation,” declared the IMF’s deputy director, David Lipton, last week. “The IMF will draw attention to the issue and help those who want to go forward.”

 

The IMF says impoverishing more people through burdensome taxation will reduce traffic jams and accidents by discouraging driving.

Gas in the U.S. is currently between $3.26 and $4.00 per gallon and the proposed IMF tax, if adopted, would inflict further damage on the economy.

 

“Good grief!” exclaimed Rep. Fred Upton, a Michigan Republican who chairs the House Energy and Commerce Committee. “Higher gas prices hit those who can least afford it the most as American families are forced to pay a larger percentage of their income on higher energy prices.

“Drivers across the country are already struggling to pay up to $4.00 a gallon for gas, and further price increases at the pump could be devastating to low and middle-class families and disastrous to our economic recovery. Instead of finding way to make gas more expensive, our focus needs to be on finding solutions to keep energy prices affordable.”

 

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David Stockman: Ben Bernanke Is The Most Dangerous Man In US History

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Saman Mohammadi Infowars.com April 3, 2013

Obama Ben Bernanke is to America what Osama bin Laden was to Islam: poison.

The Federal Reserve has exhausted its legitimacy. It is a morally, legally, and politically bankrupt entity.

“What I do know is that this market lives and dies by the last word of the Fed and the people at the Fed have no clue what they’re doing. Bernanke is the most dangerous man ever to hold high financial office in the history of the United States.” – David Stockman, former Director of the Office of Management and Budget (1981–1985).

Video Title – David Stockman: Ben Bernanke Is The Most Dangerous Man In US History. YouTube Video Description – [Channel: selfownership1]:

This video may contain copyrighted material. Such material is made available for educational purposes only. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 107 of the US Copyright Law.

 

Watch the Report Filed on our YouTube Channel here…

 

 

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North Korea almost certainly lacks basic technical capability to carry out its big war plan

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Max Fisher washingtonpost.com March 31, 2013

North Korea is sending lots of signals that it’s about to start World War III. While there is a real risk that some misstep or miscalculation might accidentally start a conflict, and while it is certainly possible that the country could repeat a smaller-scale attack like its November 2010 shelling of South Korea’s Yeonpyeong Island, there are some very good reasons to think that Pyongyang is bluffing about full-scale nuclear war.

Still, it’s worth asking: Could North Korea carry out its “U.S. Mainland Strike Plan,” apparently detailed on a chart in Kim Jong Un’s war room, in which it launches simultaneous missile attacks on Guam, Hawaii and major cities on the West and East coasts? What about its threatened “precision nuclear strikes” against the U.S.?

The short answer is, no, probably not. Let’s rule out the nuclear threat right now: while North Korea does have nuclear warheads, it does not appear to have mastered the technology to miniaturize them enough to put on top of a missile.

 

Read more

 

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