“Let’s face it; many of the world’s
‘developed’ nations are insolvent … Either (they) will
default or they will try and inflate their currencies into oblivion.
Politicians can lie all they want, but the truth is that the debt obligations
of these European nations are simply too large relative to the size of their
economies.”
“In Greece, government debt now represents almost
160% of GDP and the average yield on Greek debt is around 15%. Thus, if
Greece’s debt is rolled over
without restructuring, its
interest costs alone will amount to approximately 24% of GDP. In other words,
if debt pardoning does not occur, nearly a quarter of Greece’s economic
output will be gobbled up by interest repayments!”
Puru Saxena, Do The
Math, 8/21/11
Yes, it must be emphasized that the
debt obligations of several other major nations are similarly “too
large” to. Also, ominously, the Financial Sector has manifested a
serious downtrend in recent months (e.g. see chart of XLF) -- a precursor to
the crash of many market sectors, as it was in 2007-2008.
“…the Fed has to again purchase about $900
billion more Treasuries this new upcoming fiscal year. There is no way to
avoid that and if they have to buy Agencies and more toxic bonds the figures
will be higher…
The Fed should have long ago been reabsorbed into the
Treasury, especially after observing its performance over the past few years.
The lying about what they had been doing in lending something close to $20
trillion and keeping it a secret… No matter what the outcome both the
Fed and the ECB will continue to create money and credit one way or another
and in that process achieve little except a temporary solution and
substantially more inflation… All of the Fed’s and ECB’
policies do not work. We know that already. Those who believe that the Fed
and the EB don’t know what they are doing are wrong. Both central banks
know exactly what they are doing. That is creating a framework for the
financial and economic destruction of economies of the US, UK and Europe in
order to bring about a New World Order. In order to not allow the system to
fail… Insolvent banks were legally allowed to carry two sets of books
with the approval of the US government, the Bank for International
Settlements, the BIS, and the accounting rules group FASB. What is very
important to realize here is that some of these banks that are insolvent own
the Fed. As a result they tell the Fed how much money and credit they need,
and as a result they flow to the banks in unlimited amounts…
No matter how you look at it quantitative easing is a
bailout of the financial sector. That even applies to the Fed’s purchase
of Treasury, Agency bonds and other toxic waste, because it relieves the
financial sector of the responsibility of purchasing these bonds. Those funds
are then freed up for speculation in markets. This approach to financial
crisis assures the survival and profit of the vested interests…
Their only real mission is to keep the financial sectors in
NYC, London and Europe solvent and operating. There are no other
considerations, except printing trillions of dollars to keep the stock market
up… As a result of this myopia approach wages have hardly grown,
unemployment has continued to rise and consumer purchasing power has fallen
about 10% year-on-year… None in Wall Street, banking or government has
a care about the American worker, who is earning much less than 11 years ago,
or retirees who have to find a way to exist on 1% or 2% yields on their
meager savings.
These are the same people who rig every statistic released
by government and even some issued privately.”
Bob Chapman, The International Forecaster, 9/10/11
It should be clear to all
Realistic Astute, and Non-Mainstream
Media-Bamboozled Observers by now that, like it or not, a New Era for
Investing, Economies and Politics has begun.
It is absolutely essential to understand
certain key characteristics of this New Era.
Failure to do so can lead to Investing and
Economic Ruin.
Doing so is a necessary condition
for Investing, Economic and, indeed, Political Success.
First, it is essential to
understand The Reality of the Inflation – Deflation Conundrum.
The question is: Are we now in a Deflationary
or Inflationary Period and where do we go from here?
True, there are strong
deflationary forces in play. Real Estate in the U.S. and elsewhere is still
deflating, Wages are flat or down and Unemployment is up. There has been
essentially no significant new net job creation in the U.S. or Europe for
years.
BUT, notwithstanding these deflationary
forces, the Inflationary Forces now predominate, in fact, the Trillions of “Printed/Digitized” Fiat
Dollars and Other Currencies which the Fed and its Allied Central Banks are
creating has, and is, creat(ing)
massive Price Rises in the Essentials, especially Food and Energy.
Taking all the deflating and
inflating Factors together leaves us with, for example, with 11.4% Real CPI
in the U.S. and with similar figures in developed and developing
economies – all threshold Hyperinflationary.
Shadowstats.com calculates Key Statistics the way
they were calculated in the 1980s and 1990s before Official Data Manipulation
began in earnest. Consider
Bogus Official Numbers vs. Real
Numbers (per Shadowstats.com)
Annual U.S. Consumer Price Inflation reported September 15, 2011
3.8% 11.4%
(annualized August, 2011 Rate)
U.S. Unemployment reported September 2, 2011
9.1% 22.8%
U.S. GDP Annual Growth/Decline reported August 26, 2011
1.55% -2.83%
U.S. M3 reported September 9, 2011 (Month of August, Y.O.Y.)
No Official Report 2.30%
And the massive amount of printed/digitized
dollars that the ECB U.S. Fed and three other banks promised (on September
15, 2011) to loan European bank will surely be an additional
Hyperinflationary force.
This leads us Immediately to one
Major Threatened Sector – Vulnerability of Pensions.
As Jeff Nielson points out, since nearly 1/4
of many nations’ GDP is consumed in paying interest on Debt to
Mega-Bankers and since many pensions funds’ assets are typically
deployed in Assets which are, and will be, most hurt by such asset allocations,
these funds assets are increasingly at risk from
both prospective hyperinflation and outright default.
“Western pension crisis”… has two primary
drivers… nearly ¼ of the GDP of these various economies consumed
in paying interest… these economies can never generate the same average
level of return we experienced when our economies were in relative
health… the propensity for pension fund managers to buy the worst
investments in the marketplace.
...these pension fund administrators have allowed their decisions
to be “heavily influenced” by the Western financial *****
syndicate – i.e. multinational bankers…
“pension reform”: (should) require pension fund
administrators to invest in the same financial products they are purchasing
for pension beneficiaries – at least in their own pension accounts.”
“Salvation For Western Pension Funds”
Jeff Nielson, lemetropolecafe.com, 9/10/11
This leads us to another Achilles heel of
developed Western Nations, especially the USA.
The U.S. has (and is) engaged in shipping
jobs overseas through a variety of so-called “Free Trade”
agreements.
The argument by Free Traders is
that Americans will benefit from cheaper imported goods.
But the unemployed and
underemployed Americans cannot buy cheaper goods at any price, and they (all
50 million of them when members of their households are included) impose
additional huge social safety net costs (food stamps, welfare, free health
care, education, unemployment insurance) on those who are still working, far
outweighing the ostensible benefits of “Free Trade.”
Instead, a reasonable multilateral
Tariff system (“Fair Trade”) could solve the problem, but none
appears to be in sight.
“Republicans stupidly cling to trade agreements as a
means to boost the US economy. This is a staple crony capitalism policy. How
did GATT work out? What about MFN for China? Anyone want to defend how NAFTA
helped the US economy?
All trade agreements of recent vintage have induced US
large corporations to boost foreign production and cut US jobs. US
corporations and solons’ main rationalization for the trade pacts has
been to proclaim that the trade pacts will bring lower priced goods to the
US. This only benefits those that have jobs…Fair trade pacts, quid pro
quo, should be the standard.”
Bob Chapman, The International Forecaster, 9/10/11
And we need not comment Further
(than we have in previous articles) on the inability and unwillingness of
Economic Policy Leaders, e.g. at the ECB, Fed, U.S. Treasury, etc. to provide
effective and sustainable Solutions for Economic, Financial, and
Employment Problems. A prime example is the Sovereign Debt Crises. It
appears increasingly likely that certain nations will have to choose between
National Failure and Mega-Bank Failure.
Black Swan author Nassim Talef sums up the Solution to this Problem rather Nicely:
“People who were driving a
school bus blindfolded (and crashed it) should never be given a new bus.”
But a changing of the Drivers (the
Fed-led Mega-Bank Cartel and subservient politicians) is not likely any time
soon.
Finally an investor needs to
address a Prospective Crisis in Corporate Earnings and thus a
Prospective Serious Market Swoon in the Equities Markets.
David Rosenberg states it well,
“Between equities and commodities, a pretty clear
picture of softening global economic growth has re-emerged. Ignore these
signposts at your peril, as they are not being reflected in the analyst
earnings forecasts that investment banks publish and portfolio mangers listen to.”
And it is not merely the
prospective Earning’s Crisis which will cause a Market Swoon, but also
the Credit Debt, and Inflation Crises.
For Investors The Solutions are
three-fold:
1. Buy essential Tangible Assets on the Dips. And we specifically
recommend Gold, Silver and Food.
But the timing of Gold and Silver Purchases is especially important because
these Precious Metals are subject to ongoing Price Suppression Attacks by a
Fed-led Cartel (see below*) of Central Bankers and their Allies. Tracking
these Interventionals has facilitated Deepcaster’s making four Profitable (Buy and) Sell
Recommendations in the last 60 days (see Note 2 below).
2. Go local when Possible. A quick
look at the XLF shows the present and prospective Vulnerability of the
Banking Sector. Keep assets outside of Global Banking Sector when at all
possible.
3. Make Provisions for your Personal Safety. As Crises deepen Social
Chaos is likely. Just a decade ago the Argentinean Financial Crises resulted
in Power Outages, Termination of Police and Other Services, Gas Stations
Closures, Foodless Grocery Stores, and bank and retirement check failures. It
can happen where you live too are.
See Deepcaster
Article for Specific Details and Recommendations:
Maximizing Profits
from The Real Golden (& Silver) Bull (9/2/11)
Last Tango Opportunities & Traps -
Overview (8/5/11)
Profitably Playing Manipulation (7/21/11)
Superb Fortress Assets Opportunities
– Coming Soon! (6/30/11)
Finally, bear in mind that, finally, some relief is
coming to Precious Metals Partisans who have suffered from Cartel* Precious
Metal Price Suppression Attacks.
By the end of the year, the Pan Asian
Gold Exchange should be in operation in China.
This should aid considerably in achieving Real
Market Price Discovery for Gold and Silver, as opposed to the Managed
Price Discovery Mechanism characteristic of The Cartel/London-Bullion-Markets
Assn. dominated era, an Era now drawing to a close.
Best
regards,
Deepcaster
September 15, 2011
**Note 1: Shadowstats.com calculates Key
Statistics the way they were calculated in the 1980s and 1990s before
Official Data Manipulation began in earnest. Consider
Bogus Official Numbers vs. Real
Numbers (per Shadowstats.com)
Annual U.S. Consumer Price Inflation reported August 18, 2011
3.63% 11.21%
(annualized July, 2011 Rate)
U.S. Unemployment reported September 2, 2011
9.1% 22.8%
U.S. GDP Annual Growth/Decline reported August 26, 2011
1.55% -2.83%
U.S. M3 reported August 14, 2011 (Month of July, Y.O.Y.)
No Official Report 2.44%
***Note 2: Using the above Guidelines allowed
Deepcaster to make buy and sell recommendations
resulting in remarkable profits recently if acquired and liquidated when we
recommended*, approximately:
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 45% annualized!)
38% Profit on Silver on July 18, 2011 after just 201
days (i.e. about 68% annualized!)
150% Profit on Gold Stock Calls on July 13, 2011
after just 56 days (i.e. about 975% annualized!)
40% Profit on leveraged Short Treasuries ETF Puts on
April 15, 2011 after just 3 days (i.e. about 4800% annualized!)
30% Profit on Silver on April 6, 2011 after just 98
days (i.e. about 111% annualized!)
To read our recent article -- “Essentials for
Wealth Acquisition Acceleration”, go to www.deepcaster.com and click on
the ‘Articles by Deepcaster’ Cache.
Past Profitable Performance is no assurance of
future Profitable Performance.
Wealth
Preservation - Wealth Enhancement
Financial
and Geopolitical Intelligence
Gravitas,
Pietas, Virtus
|