“The Financial Times reports that the European Central Bank has
secretly distributed E100 billion to Greek banks and billions more in secret
to other European banks and, in doing so, has gained great "sway over eurozone politicians" -- you know, the people
actually elected to run their countries.
“Infinite secret money is infinite secret power, and it's great that
the FT is interested in this aspect of central bank secrecy. Is it too much
to hope that the FT someday will show similar interest in the secrecy imposed
by central banks on their interventions in the gold market, interventions
detailed by GATA here?”
Central Bank secretly distributes infinite money”
Powell, Secretary/Treasurer Gold Anti-Trust Action Committee Inc, 5/22/12
No surprise that The Cartel (Note 1) of
Central Bankers continues to pump more Q.E. into the Financial System to
preserve the Mega-Banks’ Power and Profits. Once The Cartel Bankers
begin QE (i.e., Fiat Money Printing) they can’t stop. The problem is, Infinite Q.E. – The Biggest One – is
ultimately a Recipe for Disaster for Citizens and Investor-Citizens alike
since it eventually creates Dangerous Price Inflation.
“It's going to happen – as surely as we'll see QE4, QE5,
and on and on and on.
“That's the problem with reckless money printing. It's like jumping
into a swimming pool. You can't ever "un-jump."
“So now it's just a question of timing the announcement for maximum
Prepare for More Money Printing,” Jeff Clark, 5/15/12
QE can not be
stopped any time soon, but it can be Profitably Corralled as we explain.
But first a bit more context is needed.
Consider that a Covert (albeit de facto) QE3 has already been
implemented in the last 6 months via The Fed’s Operation Twist and the
ECB’s LTRO program.
Moreover, consider that the potentially
Toxic (because highly leveraged) Derivatives Positions at the Mega-Banks are
of the same Order of Magnitude that they were before the 2007-2009 Financial
Specifically, consider the Multi-Trillion
Dollar Derivatives Positions at the Four largest Banks (Sept 30, 2011) and
compare it with their Total Assets.
AMOUNT OF DERIVATIVE CONTRACTS
COMMERCIAL BANKS AND TRUST COMPANIES IN DERIVATIVES
30, 2011, $ MILLIONS
JPMORGAN CHASE BANK NA
CITIBANK NATIONAL ASSN
BANK OF AMERICA NA
GOLDMAN SACHS BANK USA
Compare the approximate $4.7 Trillion
combined Assets of these four largest Banks with their approximate $232
Trillion Notional Derivatives Exposure (as of September 30, 2011.
Stress Test Anyone?
Consider in addition, for example, the
Best Estimates of the Capital Injection needed to “save” the
Spanish Banks – around One Trillion Euros.
No wonder yields on 10 year Spanish
Government Notes are approaching the Hyper-Toxic 7%.
A major problem in that each additional
Injection of QE creates less and less Markets Boosting effect. Just as a Drug
Addict needs more and more, with increasingly less effect.
Jeff Clark is correct, additional QE
Tranches are coming “surely … we’ll see QE4, QE5 and on and
on and on”.
But unlimited QE (i.e., unlimited
Monetary Inflation) inevitably brings Price Inflation, which we are already
seeing round the World. In the U.S., for example, 9.94%, annualized per
shadowstats.com, already Threshold Hyperinflationary. Food Prices, e.g., are
off their highs, but they have not really dropped that much, have
So Neither Monetary nor
Intensifying Price Inflation can be stopped, any time soon (though
ultimately, the QE-Paper-Edifice is likely to collapse).
But the effects of Hyperinflation can be
The following excerpt from Sharps Pixley gives us a clue as to how.
“Central banks gold purchase data in April cheered the gold
market on Thursday, however. Mexico, Kazakhstan and Ukraine added about
204,000 ounces in April. The Philippines added a whopping 1.033 million
ounces in March with gold now at 13.6% of its total reserves. UBS highlighted
the Philippines’ gold purchase is significant as this is the second
largest monthly Central Bank’s purchase after Mexico’s purchase
of 2.5 million ounces in March 2011.World Gold Council (WGC) reported that
central bank purchases were 80.8 tonnes in Q1 2012
or around 7% of global gold demand. What is more interesting is that WGC is
now confident that central banks will continue to buy gold and has added
official sector purchases as a new element of gold demand while eliminating
official sector sales as a negative supply factor.”
“Central Bankers Bought More Gold while European Leaders Kept
Austin Kiddle, Sharps Pixley,
If there is any group that should
know the effect of, and remedies for, infinite Fiat Money Creation, it is the
And what are they doing? They are buying
And notice that in the recent Equities
Market Downdraft, Gold is acting as a Safe Haven Asset, stubbornly
refusing to move lower than the $1550s to $1560s range. Buying Timing is Key.
Notice also that recently the Mining
Shares have performed better than Equities-in-General. The aforementioned are
why Deepcaster has added Mining Shares
Recommendations and other Monetary Inflation Surmounting Recos,
including High Yield Recommendations (See Notes 2 and 3) aimed at achieving a
Total Return (Gain + Yield) in excess of Real Inflation, to his Portfolios.
Thus, Guidelines for building a “Corrall” with both Wealth Protection and Profit
1) Buy Physical
Gold and Silver at the right time.
2) Buy Quality
Mining Shares whose Fundamentals and Key Technicals
are quite Bullish now.
3) Do not be
satisfied with Achieving anything less than a Total annualized Return in
excess of the Real Inflation level of 10% otherwise, you will Surely
lose Purchasing Power.
4) Aim to shift
investments into Sectors which are resistant to and Profit from Monetary, and
thus Price, Inflation.
“Q.E. to Infinity” as Jim
Sinclair puts it, is here, now. And Deepcaster will
be forecasting the timing of the next QE Tranche, implemented “for maximum
impact” as Jeff Clark correctly notes.
June 02, 2012
*Shadowstats.com calculates Key Statistics the way they were calculated in
the 1980s and 1990s before Official Data Manipulation began in earnest.
Bogus Official Numbers vs. Real
Numbers (per Shadowstats.com)
Annual U.S. Consumer Price Inflation reported January 19, 2012
2.96% / 10.57% (annualized December, 2011 Rate)
U.S. Unemployment reported February 3, 2012
8.3% / 22.5%
U.S. GDP Annual Growth/Decline reported January 27, 2012
1.56% / -2.70%
U.S. M3 reported February 13, 2012 (Month of December, Y.O.Y.)
No Official Report / 3.87%
And Official Source Disinformation
continues, consider Shadowstats comments on the
January 6, 2012 release of U.S. Employment data:
reported seasonally-adjusted 200,000 jobs surge in December 2011 payrolls
included a false, seasonally-adjusted gain of roughly 42,000 in the
“Couriers and Messengers” category. That gain was an artifact of
the seasonal-adjustment process and will remove itself in the January 2012
problem is that this 42,000 gain is part of a seasonal pattern that fully
reverses itself each January…”
Payroll Seasonal-Adjustment Problem”
John Williams, 1/6/12
Note 2: Deepcaster addresses the questions of Profit and
Protection in light of Fiat Currency Purchasing Power Destruction and
provides Guidelines in his article – “Essentials for Wealth
Acquisition Acceleration” found in ‘Articles by Deepcaster’ Cache.
Using such Guidelines facilitated Deepcaster’s
making buy and sell recommendations resulting in remarkable profits recently
if acquired and liquidated when we recommended, approximately*:
45% Profit on
Platinum ETF on February 8, 2012 after just 42 days (i.e., about 390% annualized!)
40% Profit on March 2012 $55 Dollar GDX
Calls on January 27, 2012 after just 23 days (i.e., about 635% annualized!)
34% Profit on Gold Royalty Streaming Company on December 5, 2011 after just
166 days (i.e., about 74% annualized!)
42% Profit on Volatility Index Futures ETN on October 3, 2011 after just 292
days (i.e. about 52% annualized!)
36% Profit on Double Short Euro ETF on September 7, 2011 after just 43 days
(i.e. about 300% annualized!)
35% Profit on Double Long Gold ETN on August 23, 2011 after just 41 days
(i.e. about 280% annualized!)
26% Profit on Double Long Gold ETN on August 17, 2011 after just 35 days
(i.e. about 260% annualized!)
25% Profit on Gold Stock on August 8, 2011 after just 201 days (i.e. about
150% Profit on Gold Stock Calls on July 13, 2011 after just 56 days (i.e.
about 975% annualized!)
*Past Profitable Performance is no assurance of future Profitable
Great Opportunity and A Dangerous Trap; Forecasts: Gold, Silver, Equities,
Crude Oil, U.S. Dollar, U.S. T-Notes, T- Bonds, & Interest Rates”
– February Letter
Fed doesn’t have a clue about markets or economics. They are dangerous
Printing money is not good for the world and will lead to more problems for
“What the Federal Reserve is doing now is ruining an entire class of
Jim Rogers, Bloomberg Interview, 6/29/11
We are not so Negative about the Near-Term Prospects for Nominal
Asset Price Growth in Certain Sectors as we were six months or
a year ago.
That is mainly because the E.U., Mega-Banks, and the Fed, have already de
facto launched a Massive Quantitative Easing 3, with more likely to come.
This QE will serve as a Major Force impelling (but not necessarily
successfully) Nominal Asset Prices UP in certain Sectors, for example,
But before one becomes too enthusiastic about the Prospects one should
consider the implications of our Forecast for Nominal Assets Prices Strength
in certain Sectors.
The practice of issuing Bogus (U.S. and other Key official) Inflation figures
obscures the Fact that Monetary Inflation (generated mainly by reckless Q.E.)
is very rapidly depreciating the purchasing Power of most Fiat Currencies
– by about 11% per year in the U.S. e.g. (per shadowstats.com).
Yield Portfolio is aimed at achieving Total Return in excess of Real
Inflation. Stocks in that Portfolio with Recent Yields of 18.5%, 8.6%, 10.6%,
26%, 6.7%, 8%, 10.6%, 10% and 15.6% when they were added to the Portfolio.
important to note is that, while massive Q.E. is a Major Inflationary Force
tending to pump up Prices in certain sectors, there are Powerful Deflationary
forces operating as well – the depreciating Housing Markets in the U.S.
and China come to mind. Real Estate in some areas in China is down over 25%,
but Food prices are up 9% year over year.
The key to identifying The Great Opportunities (and Great Potential Losses) is knowing which Sectors will likely have Inflating
Asset Prices and which will have Deflating ones.
Investors failing to Evaluate Inflation/Deflation Prospects on a Sector by
Sector Basis will have missed Great Opportunities and fallen into a
Deepcaster’s Letter --“A Great
Opportunity and A Dangerous Trap; Forecasts: Gold, Silver, Equities, Crude
Oil, U.S. Dollar, U.S. T-Notes, T- Bonds, & Interest Rates; February
Letter” -- posted in the ‘Latest Letter & Archives’
Cache at www.deepcaster.com, identifies
which Sectors will likely be helped (albeit temporarily) by this Massive QE3
and which will likely be hurt, and provides Forecasts for all. And in his
March Letter, “The Pause Before The Great Bull; 3 Buy Recos! Forecasts: Gold, Silver, Equities, Crude Oil, U.S.
Dollar/Euro, U.S. T-Notes, T- Bonds, & Interest Rates, March
Letter”, Deepcaster makes 3 Buy
Recommendations designed for Protection and Profit.