Forget About Catalonia And Brexit, The Next European Black Swan Could Be Transylvania

Over the past 100 years, the borders in Central and Eastern Europe have been redrawn time and time again, often leaving groups of people separated from their home country by new borders. Although land often changed hands relatively peacefully, suddenly finding one-selves as an ethnic minority in a new country was bound to lead to tension and resentment.

While these resentments may reveal real disenfranchisement of ethnic minorities in Central Europe, politicians, especially populist figures, have seized on the outsider narratives inherent in the diaspora experience.

As the April 2018 election approaches in Hungary, Prime Minister Viktor Orban has been reaching out to the Hungarian minority in Romania, drawing criticism from Romanian leaders, while his supporters insist he is trying to lend his support Hungarians everywhere.

Rooted in History

Tensions between Romania and Hungary can be traced back to World War I and the Treaty of Trianon.

Although the Treaty of Trianon ended hostilities between the Allied Powers and the Kingdom of Hungary, the peace came at a great price to the Austro-Hungarian successor state. Hungary lost 2/3rd of its population and territory, leaving the former imperial hub landlocked in the heart of Central Europe. Most of its territory was ceded to Yugoslavia, Czechoslovakia, and Romania, as well as Austria, Italy, and Poland. Romania was granted the entire region of Transylvania, where an estimated 1.3 million ethnic Hungarians reside, making Hungarians Romania’s largest minority.

The loss of such a large chunk of territory and population would certainly leave its mark on national memory. Recently in Hungary, politicians have been revitalizing this narrative.

Speaking on the June 4th anniversary of the Treaty of Trianon, Jànos Làzàr, Minister of the Hungarian Prime Minister’s Office, called on the beneficiaries of the treaty to apologize, insisting, “Trianon was a diktat, a historic injustice against a nation. The entire western world is indebted to Hungary.”

Lazar was careful to say that Hungary does not advocate for the redrawing of borders, rather they merely mean to ensure that the rights of minority Hungarians are protected everywhere. Romania has not taken it that way. The Romanian authorities used words like “provocative” and “dangerous” to describe the Hungarian government’s treatment of the issue.

Diaspora Politics

This isn’t the first time Lazar has intervened on behalf of Hungarians in Romania. Last spring, Lazar interceded in the case of an ethnic Hungarian brewer, Andras Lenard, in Romania who was being pressed by Heineken. Heineken was suing the upstart brewer claiming that their names, although different languages, were too similar. Hungarian politicians reacted by calling for a boycott of Heineken products as well as proposing legislation to ban the use of the Heineken red star as a communist symbol. Heineken responded by dropping the charges against Lenard.

The intervention of Hungary on behalf Lenard reflects a larger government policy of considering the Hungarian minority in Romania as Hungarians. In 2010, the Orban government expanded Hungary’s citizenship laws, making ethnic Hungarians in neighboring countries eligible for citizenship and therefore voting privileges. As the 2018 parliamentary elections appear on the horizon, Hungarian Prime Minister Viktor Orban has been encouraging Hungarians in other Central European countries to register to vote.

Orban’s critics claim that he is merely trying to leverage the 1 million eligible voters in Romania to attain a coveted 2/3rd majority in parliament for his Fidesz party. Fidesz is just two seats away from a majority that would allow them to make constitutional changes. Considering that in the 2014 elections 95% of the vote from citizens domiciled outside of Hungary went to the Fidesz party, mobilizing the Transylvanian vote is of key importance to the Orban administration. The fact that Orban may be able to mobilize thousands of votes in the diaspora is a sign that minority protection in Central Europe is an issue that should not be overlooked.

Orban doesn’t just encourage the dual-national Hungarian minority in Romania to vote in Hungarian elections, drawing further criticism from Romanian figures. In a trip to Transylvania just before the 2016 Romanian elections, Orban stirred angst against the government, claiming that the government is failing to help the ethnic Hungarians. Orban went as far as to say that the Romanian government lacks respect for the Hungarian minority. He urged them to vote in their own best interest in the elections.

Romanian critics of Orban have accused him of trying to meddle in their politics. Former President Traian Basescu even called for the removal of the Hungarian ambassador from Romania.

ReConnect Transylvania

ReConnect Hungary is a birthright program for Canadian and American young adults of Hungarian heritage. The program aims to help Hungarians in North America forge a sense of Hungarian patriotism through travel in the region and volunteer opportunities. Interestingly, the study trip is not limited to the country of Hungary, rather participants visit Hungary, as well as the Hungarian Diaspora in Serbia, Ukraine, or Slovakia to witness, “how young Hungarians outside Hungary are maintaining their identity and traditions.”

As of 2017 the program offers a three month long ReConnect Transylvania program. Participants in this program will spend 3-6 months working with an NGO in Transylvania to “discover the deepest layers of being Hungarian.”ReConnect Hungary also now offers a week long extension on the original two week long ReConnect Hungary program to explore Hungarian culture in Transylvania. By including the Diaspora in the discussion about Hungarian culture, this private-public partnership builds a concept of a Hungarian nation that traverses accepted borders.

ReConnect Hungary is part of a larger trend called diaspora tourism. Proponents of the trend argue that it cultivates a sense of cultural heritage abroad and encourages tourism, while critics claim local leaders are using it to manipulate foreign nationals.

Cultivating strong national identity abroad can be a powerful tool, and not just in dual-citizens. Hungary has already seen some success in this regard. In 1987 the Hungarian Human Rights Foundations, comprising of second generation American citizens, successfully lobbied congress for the removal of Romania’s Most Favored Nation status. The lobbying efforts were in response to the human rights violations of the communist regime, as well as specific abuses of the Hungarian population in Romania.

- Source, Zero Hedge

As One Economy Implodes Another Economy Explodes

The further back in history one looks, as I have heard Mike Maloney say, the further into the future one can see. What do we see as we look forward from here?

For those paying attention it is easy to see that China, along with her closest ally, Russia, are forming alliances’, growing business opportunities and retooling their domestic economies from the ground up. These nations are embracing the 21st century and 21st century technology that has the worlds attention. Well, most of the worlds attention. If you listen to the US, UK, and their allies mainstream media you would think China and Russia are still 3rd world nations with barely two sticks to rub together to create fire. Nothing could be further from the truth. If anything the Western “developed” nations, like the US, UK and their allies are the nations that are in fact stuck in the 1950’s mindset that their respective nations are in charge of the world – they are not.

If we review what has happened, just this week, in China and Russia and compare this to what is happening in the US/UK we will see polar opposite scenarios playing out.

First up, the positive side of the fence – China and Russia

The BRICS New Development Bank (NDB) has approved two loans – for a water infrastructure project in India and the other is for a transport infrastructure project in Russia.
The Board of Directors (BoD) of the NDB approved two infrastructure projects with a loan value of US$413.8 million during the 12th BoD meeting in Shanghai on November 20.

“The NDB was established to mobilize resources for infrastructure and sustainable development in BRICS and other emerging economies and developing countries, and the two projects approved today are fully in line with the Bank’s mandate and national development plans of our member countries,” said Mr. K.V.Kamath, the NDB President.

The larger loan of $345 million will be lent to the Government of the Republic of India, which will forward it to the Government of Rajasthan for rehabilitating the Indira Gandhi canal system.

It will be a multi-tranche facility so it will be drawn down in stages as the project progresses.

Moody’s Investors Service upgraded India’s credit rating to Baa2 last week from Baa3 and changed the outlook to stable from positive. Its decision was underpinned by expectations that continued progress on economic and institutional reforms will, over time, enhance India’s high growth potential and its large and stable financing base for government debt, and will likely contribute to a gradual decline in the general government debt burden over the medium term.

S&P Global Ratings rate India at BBB- with stable outlook, while Fitch Ratings has the same rating at BBB- with stable outlook.

The smaller loan of $68.8 million will be lent to the Government of the Russian Federation who will use it for the construction of a toll transport corridor connecting the Ufa city centre to the M-5 federal highway. 

The Russian economy expanded by 1.8 per cent year-om-year (y/y) in the third quarter after a near five-year high of a 2.5% y/y gain in the second quarter.

While the NDB gave the go-ahead for loans to seven projects reaching $1.5 billion in 2016, the amount of approved loans is expected to reach $2.5 in 2017.

“We want to fund projects that are creative and bring benefits to the local people and environment,” NDB Vice-President Zhu Xian said earlier. Source

After conducting a couple of searches for long term infrastructure projects that are being funded this week, I find a sad lack of any funding for any such projects in the west. What we were able to find were excuses, lies and a very serious need for infrastructure projects within the United States. If the US is going to remain the top economy in the world, it needs to address the crumbling infrastructure and stop funding so many unConstitutional wars.

What is the overall state of the nation’s infrastructure?The U.S. population has more than doubled since the 1960s, when most of the country’s major infrastructure systems were designed. Many are reaching the end of their lifespan, and are dangerously overstretched, experts say.

The American Society of Civil Engineers (ASCE) has compiled regular “report cards” on the state of U.S. infrastructure since the 1980s. In its 2017 report, the ASCE finds that the nation’s infrastructure averages a “D,” meaning that conditions are “mostly below standard,” exhibiting “significant deterioration,” with a “strong risk of failure.” The group estimates that there is a total “infrastructure gap” of nearly $1.5 trillion needed by 2025.

Other analysts agree that the shortfall is large. The U.S. Department of Transportation (DOT) estimates that over $800 billion is required just to shore up the nation’s roads and bridges. McKinsey researchers say that $150 billion per year will be required between 2017 and 2030 to keep abreast of all the country’s infrastructure needs. Source

Here is a short video produced by the American Society of Civil Engineers (ASCE). This group of people should know a thing or two about the importance and maintenance of roads, railway, bridges and water systems.

If our so-called “leadership” continues to ignore infrastructure and continue to waste our investment dollars on war we will awaken to much higher taxes, fewer jobs and our world, the United States, will have one of the worst road, bridge, railway and water systems in the world.

- Source, Rory Hall via Sprott Money

How Much Longer Can the Petrodollar Survive?

Jerry Robinson, explains why a dollar crash may be imminent, what it will mean for your investments and how to protect yourself.

Is the end of the Petro Dollar era upon us?

- Source, Jay Taylor Media

The Abandonment of Honesty: How They’re Hiding the Truth from Us

From deception on the micro-scale of consumer goods packaging and ingredients labeling, to the mega-scale of falsified government employment and inflation statistics, is the propaganda we are being fed intentionally designed to CONCEAL THE TRUTH so as to prevent alerting the masses to the caving economy and rampant loss of: employment, earning power, and buying power? Are we being LIED TO about the ongoing THEFT of our current and future financial freedom?

- Source, Reluctant Preppers

Bitcoin is a Reflection of the Hidden Panic in the Markets

Bitcoin’s rapid rise in value is sending a warning signal, according to former Fed insider Danielle DiMartino Booth. She says, “To me, Bitcoin is a reflection of panic. It’s a reflection of people trying to get money into a safe place knowing the major governments of the developed world have got their printing presses running 24/7. 

It is a reflection of anxiety in fiat currencies and the fact it’s not practical to go back to a gold standard. What scares me about Bitcoin is the central bankers are studying it to figure out how the blockchain works.

They are going to be controlling our spending with blockchain technology that is being perfected in the crypto currency universe.I am not a gold bug, but we do know that in times of corrections that there is no place to hide in traditional asset classes that you can get at your Merrill Lynch brokerage. 

Gold and silver in the precious metals complex are the only places to hide and get true diversification and safety.”

- Source, USA Watchdog

John Rubino: A Repeat of the 1970's Inflation or Even Worse?

John Rubino gives his thoughts on the increase in the money supply, velocity of money and what it means for the Fed’s monetary policy in light of debt levels.

- Source, Jay Taylor Media

Hyperinflation Watch: 300% Obamacare Premium Increases

Over the past several months, Democrats have jumped on every opportunity possible to blame the Trump administration for yet another year of staggering Obamacare premium increases. Ironically, despite arguments from the Left that Trump’s defunding of Obamacare’s marketing budget would cause 2018 signups to plunge, as Politico recently noted, they’re actually up in 2018…which begs the question:was the Obama administration just wasting $100 million a year in taxpayer money for nothing? Shocking thought, we know.

Meanwhile a fresh barrage of outcries from Democrats, most notably Ms. Nancy Pelosi, came after Trump’s decision to cut federal subsidies, an action which the CBO insisted could result in devastating premium increases of up to 20%.

Of course, if Trump is responsible for 20% of Obamacare’s premium hikes in 2018, then perhaps Nancy Pelosi should explain to the Dixon family in Charlottesville, VA precisely who is responsible for the other portion of the 235% premium hike they just received.

As the Washington Post points out this morning, the Dixons, a family of 4 in Virginia, were shocked earlier this month to find that their Obamacare premiums were going to surge from roughly $900 per month in 2017 to over $3,000 per month in 2018.

Ian Dixon, who left his full-time job in 2016 to pursue an app-development business, did so because the ACA guaranteed that he could still have quality coverage for his young family, he said.

But when the 38-year-old Charlottesville husband and father of a 3- and a 1-year-old went to re-enroll this month, his only choice for coverage would cost him more than $3,000 a month for his family of four, which amounted to an increase of more than 300 percent over the $900 he paid the year before. And this is for the second-cheapest option, with a deductible of $9,200.

“Helpless is definitely a good word for it,” Dixon said. “Rage is also a good word for it.”

Of course, Democrats and the MSM also applauded Obamacare’s ‘great success’ earlier this year when several counties that were previously feared to be left with no coverage options in 2018, suddenly picked up a carrier. That said, perhaps Bloomberg, Reuters, NBC, etc. should reconsider just how meaningful these Obamacare monopolies are if the premiums charged are so high that no one can afford them anyway…
Earlier this year, Aetna and Anthem pulled out of the Albemarle market, citing too much unpredictability and risk. A smaller carrier, Optima, came in to fill the void. Consumers in the area went from having 19 plans offered in the options from Aetna and Anthem to only five coverage options with Optima.

Several factors led to Optima’s offering such high-priced plans, said Michael Dudley, the president of Optima.

First, small communities like Charlottesville tend to be pricier to cover because there is a small patient pool to balance out risks. So Optima took a cue from the carriers who had already ditched the market when actuaries predicted it was a place where the insurance companies might be paying out more to cover claims than it receives in premiums.

It is also a more expensive coverage area because the primary provider is University of Virginia Health System, an academic medical center that charges higher rates for its care than a community hospital. Optima will include UVA Health System in-network, unlike many carriers who have dropped the big medical centers as a cost-saving measure.

…perhaps local business owner Shawn Cossette can provide the Obamacare cheerleaders within the media some helpful insights…
Among them was Shawn Marie Cossette, 55, who runs her own event and floral design business in Charlottesville. Last year, she purchased an Anthem silver plan for $550 a month for herself. This year, under Optima, a silver plan would cost her $1,859 monthly.

“It’s a huge percentage of my income,” she said. “I really believed in the ACA. I really feel everyone deserves the right to health insurance, but who can afford those prices if you don’t qualify for subsidies?”

- Source, Zero Hedge

How Much Longer Can the Petrodollar Survive?

Jerry Robinson, explains why a dollar crash may be imminent, what it will mean for your investments and how to protect yourself.

- Source, Jay Taylor Media

The FED's Bubblenomics Run Amuck

If you Google “dot com bubble,” you will get nearly 1.2 million hits, and 3.3 million hits if you Google “tech bubble.” A Google search of “housing bubble” will return nearly 11 million hits. (The searches were conducted on March 29, 2017). And if you search Amazon books for financial crisis 2008 you will get more than 1200 hits.

Given all the books, monographs, essays, articles, and editorials that have been written about back-to-back bubbles that occurred within two decades, one would think there would be nothing else to write about.

The purpose of this book is to present to the general public, my fellow academicians and policymakers with an brief account and review of one of the most turbulent periods in United States history without the usual jargon academics are noted for.

As the two quotes from the Federal Reserve’s website above reveal, the Fed has been given the responsibility by the Congress of the United States to essentially promote sustainable prosperity, stabilize prices and maximize employment. During the past 100 years of the Federal Reserve’s operations, the economy has grown substantially (see Figure 1 for data since 1929), but the path to higher living standards have been interrupted by depressions/ recessions, a few bouts with double-digit price inflation and occasionally widespread unemployment. Although the Congress has expected the Federal Reserve to be a wise and prescient “helmsman,” navigating the economy from becoming overheated or plunging into a recession or worse, the Fed’s track record belies its mandates.

The Federal Reserve's primary tool, open market operations, the buying and selling of US government securities with money created out of thin air, is supposed to provide sufficient "liquidity" to grease the wheels of commerce so the US economy reaches its optimal output of goods and services and maximizes employment. Thus, the Federal Reserve has what every American wishes it had, an unlimited checking account.

The US Congress created the Federal Reserve in 1913 to stabilize the economy after the Panic of 1907, and was “sold” to the American people as a measure to rein in the banks for their reckless behavior and enormous power over the economy. The fact that bankers and their allies helped draft the Federal Reserve Act seems to have been downplayed by most economists and financial historians. Others have taken a less sanguine view of central banking.

Critics of the Federal Reserve have put the blame squarely on the shoulders of former Federal Reserve chairmen, Alan Greenspan and Ben Bernanke, and their colleagues at the Federal Open Market Committee (FOMC) for voting to inflate the supply of money and credit in order to “stimulate” the economy to maintain "aggregate demand." Both Greenspan and Bernanke defended their decisions to keep interest rates low during the second half of the 1990s and the run-up to the housing bubble of the 2000s.

Although numerous observers of the Federal Reserve's monetary policies were warning of the incipient dot com bubble of the 1990s, Greenspan and his colleagues at the Federal Reserve brushed off their warnings, even though the former Fed Chairman himself did warn of “irrational exuberance” of stock prices in a December 1996 speech. Nevertheless, after the bubble burst in 2000 and the economy entered a mild recession, the Fed did what it always has done to "combat" an economic downturn--lower interest rates to boost output and employment.

As the federal funds rate — the rate banks borrow from each other for overnight loans — fell to 1 percent in 2003 and was kept there for a year, critics assert that the Fed helped ignite a housing bubble that led to the greatest financial crisis since the Great Depression (see Figure 2). In fact, some analysts pointed out that the housing boom actually began in the 1990s and accelerated after the relatively mild 2001 recession to its bubble peak in 2006. The 30- year mortgage rate also declined precipitously, making housing more attractive for many new homebuyers. (See Figure 3) We will discuss interest rates and the housing market in chapter 1. 

So why another book on financial bubbles? The goal here is to integrate several fundamental economic and financial issues such as money, prices, interest rates, financial markets, banking, entrepreneurship, economic cycles and, of course, central banking (in chapter 1) in order to review how both policymakers and economists have assessed the US economy. In other words, if policymakers maintain that a market economy is inherently unstable and they believe they have the tools to guide employment and output on the correct path, then why did the US economy experience so much financial and economic turmoil during the past two decades? And for that matter for the past 100 years since the Federal Reserve was created in 1913?

In addition, what were Federal Reserve policymakers thinking and saying as the dot com bubble and housing bubble were unfolding? Moreover, what were economists from various schools of thought writing in real time about the boom and bust of the late 1990s and of the first decade of the 21st century? We will review their major writings and speeches in chapters 2 through 7.

In chapter 2 Alan Greenspan's speeches, testimony to Congress and other public statements during the 1990s and early 2000 will be reviewed and analyzed. Chapter 3 will focus on Ben Bernanke’s views as the housing bubble was unfolding after he became Fed chairman in January 2006. In chapter 4 the analyses and forecasts of other Fed officials such as Janet Yellin and former Dallas Fed Pres. Richard Fisher will be examined. In addition, a review of several research papers by Fed economists during the booms and busts will also be scrutinized.

Chapter 5 will highlight the views of prominent Keynesian economists while chapter 6 will focus on the analyses of well-known monetarists and supply siders. In chapter 7, the essays and other public presentations-- both written and media – of economists writing in the Austrian school tradition will be scrutinized as well.

The bottom line is what lessons have been learned by policymakers, economists, financial analysts and others who are interested in understanding how the Federal Reserve conducts its policies "to promote optimal macroeconomic performance." If the Federal Reserve's critics are correct, that the Fed’s "groupthink" ignored the warnings of individuals during the 1990s and early 2000's, then the public and members of Congress should call for a reassessment of the central bank’s mission and policies—and its very existence.

If Federal Reserve officials are "blameless" for the economy’s booms and busts, then how can the average American small business owner, employee, corporate executive and retiree manage their economic and financial affairs knowing that they will have to live through more painful economic cycles in the years and decades ahead? In other words, if a market economy is always susceptible to booms and busts, then how can the Federal Reserve better “manage” the U.S. economy to avoid a painful episode like the Great Recession of 2008 – 09 in the future?

But based on the evidence compiled during the research phase of this study, the Federal Reserve cannot achieve its goals. If it could, the US economy would not have had financial bubbles in the 1990s and early 2000s. That’s why the incontrovertible fact is that the Federal Reserve is a counterproductive institution, because it is the engine of inflation, creates bubbles that causes pain among a substantial percentage of the population when the bubble bursts and increases inequality by enriching the 1 percent, who realize that the Fed is their best ally in DC, because it enormously inflates the nominal value of their assets. In short, to use the contemporary vernacular, the Federal Reserve really sucks.

- Source, The Mises Institute

Hyperinflation Watch: £45 Painting In 1958 Just Sold For $450,000,000 USD

Leonardo da Vinci’s 500-year-old painting known as Salvator Mundi (Saviour of the World) is the only work in private hands. It just sold at Christie’s auction room in New York for a record $450m – almost half-billion. The painting apparently once belonged to King Charles I of England back in the 1600s. The last time it was sold at auction was 1958 when it was sold in London for a mere £45. At that time, it was generally believed to have been the work of a follower of Leonardo rather than the work of Leonardo himself.

The painting was sold by the family trust of the Russian billionaire collector Dmitry E Rybolovlev, who is reported to have bought it in a private sale in May 2013 for $127.5m. So that’s a pretty good profit. It is the highest auction price ever paid for any work of art. There are fewer than 20 of Leonardo paintings in existence. The Salvator Mundi, is believed to have been painted sometime after 1505. 

The bidding began at $100m and the final bid for the work was $400m, with the buyer’s premium, the full price up to $450.3m. The unidentified buyer was involved in a bidding contest, via telephone, that lasted nearly 20 minutes. The mystery buyer hopefully lives outside of New York so that avoids the sales tax. Purchases above $110 are subject to a 4.5% New York City Sales Tax and a 4% NY State Sales Tax. 

That makes anything bought in New York City subject to a total Sales and Use Tax of 8.875%. What is astonishing, is that with taxes, rates rise with the more people. That is counter to capitalism which dictates that prices decline with scale. Government costs rise with the scale showing something is just not right!

Obviously, this is serious money still moving off the grid!

- Source, Martin Armstrong

China’s Plans For A Reserve Currency

If all this sounds like Utopian musing, it becomes relevant in discussing China’s plans for a reserve currency, plans that in turn are central to my very bullish forecast for gold. I continue to believe, as I have been saying for more than a year, that China will launch an Eastern oil benchmark denominated in yuan exchangeable for gold. But China’s goal isn’t to destroy the dollar. In fact, the U.S. could end up benefiting. However, we need to be willing to broaden our world view so as to see U.S. interests as being better served by being part of an exquisitely integrated network in which all can thrive. The blood and guts of what I am getting at is that China’s ultimate goal isn’t to make the yuan, backed by gold, the world’s new reserve currency, though that may be a first step. China has a longer-term goal in mind.

To explain my thinking, go back to the above example of Zhengzhou. It illustrates China’s ability to do something that at first seems senseless –– a crazy anomaly – but that later is revealed as a necessary step to an intricately planned goal. In a very different context, something analogous is going on today – a seemingly inexplicable anomaly that is actually a step along a carefully crafted road, in this case China’s path to a new reserve currency.

China’ Staggering Blockchain Energy Usage

The latest anomaly is this: China recently banned cryptocurrency trading – even bitcoin no longer can be legally traded. Yet the government continues to allow highly skilled computer professionals to “mine” bitcoin. Mining bitcoin, as I have mentioned before, requires tremendous computer power and therefore a tremendous amount of energy. Because of China’s access to cheap electricity and its wide pool of skilled programmers, the country accounts for between 70 and 80 percent of the world’s bitcoin mining.

To give you some idea of what the country is donating to the world, each bitcoin transaction uses the equivalent of 3.3 gallons of gasoline. There are typically about 12,000 transactions an hour, meaning about 40,000 gallons of gasoline an hour. Because of the blockchain’s structure and the rules that govern it, the number of operations associated with each transaction is rising rapidly, by about fivefold a year. Assuming that fivefold yearly pace holds – and it could rise – and assuming China continues to do about 75 percent of bitcoin mining, it means that by the decade’s end China will be using the equivalent of about 20 million gallons of gasoline a day or close to half a million barrels of oil. That’s a lot of energy to expend, especially for a venture you do not even approve of.

China To Create Its Own Digital Currency

So why not ban mining? Because China will need the miners not for a bitcoin ecosystem, but to create an ecosystem for another digital currency. My best guess is that China’s eventual goal is to create a blockchain to serve a reserve currency, a currency that China itself does not need to manage.

In 2009, in the wake of the global financial crisis, Zhou Xiaochuan, the influential head of China’s central bank the People’s Bank of China, wrote a paper about reserve currencies in which he decried not the dollar per se but the use of any fiat currency as a reserve currency.

- Source, Stephen Leeb via King World News

As the Dollar Falls Gold Bulls Prepare to Charge

Gold was lower on Friday, Nov. 10, but finished last week with a net gain after hitting a three-week high in the Nov. 9 session. Spot gold was $9.60 lower at $1,275 after rising 0.40 percent on Nov. 8 and hitting its highest level since Oct. 20 at $1,287. December gold futures fell $13.30, or 1.03 percent, to end last week at $1,287.

Despite Friday’s dip, gold prices continued to hold firm above the October lows as the sideways drifting trend for gold continues against a backdrop of strong global equity markets and a rising crude oil price. The gold bulls are clearly gathering their strength for an attempt at regaining control of the short-term trend. In this commentary we’ll examine the prospects for their success.

Asia stocks hovered near a 10-year high late last week following record-breaking highs on Wall Street earlier in the week. However, U.S. equities showed signs of profit-taking on Thursday and Friday as the S&P 500 Index (SPX) dipped temporarily below the 15-day moving average before rallying to close above it (see chart below). Further weakness in the equity market would be a blessing in disguise for gold, as it would give the bulls something to rally around. It would almost certainly focus the attention of nervous investors back on the safe havens, making gold a logical choice to park their cash in the event of a stock market pullback.

Meanwhile in Washington, a Senate tax-cut bill, differing from one in the House of Representatives, was unveiled on Thursday. The Senate’s version of the bill calls for delaying a tax cut in the corporate tax rate by one year. It also differs from the House version in several other key areas, including property tax, mortgage interest, and medical expense deductions. The two chambers will have to resolve their differences in order to receive the president's approval. The Senate's version of the bill frustrates a Republican push to overhaul the federal tax code, and many observers expressed doubt over Congress' ability to arrive at a consensus.

- Source, Seeking Alpha

Here's How to Safeguard Your Money in Uncertain Times

When someone says "it's not about the money, it's about the money." Simon discusses different ways to protect your money in these uncertain times. The key is not in predicting but instead in preparing for the future.

- Source, TEDx Talks

James Rawles: Panic Early and Prosper, Wait and Suffer

What are the easiest things to do wrong in preparing for disaster? James Rawles, founder & Sr Editor of SurvivalBlog.com, returns to Reluctant Preppers to reveal the most common pitfalls - and more importantly - how to AVOID them! 

Do any of these sound like you?

- Video Source, Reluctant Preppers

The Fed Just Gave The Stock Market The Greatest Sell Signal In Modern American History

Why have stock prices risen so dramatically since the last financial crisis? There are certainly many factors involved, but the primary one is the fact that the Federal Reserve has been creating trillions of dollars out of thin air and has been injecting all of that hot money into the financial markets. But now the Federal Reserve is starting to reverse course, and this has got to be the greatest sell signal for financial markets in modern American history. Without the artificial support of the Federal Reserve and other global central banks, there is no possible way that the massively inflated asset prices that we are witnessing right now can continue.

The chart below comes from Sven Henrich, and it does a great job of demonstrating the relationship between the Fed’s quantitative easing program and the rise in stock prices. During the last financial crisis the Fed began to dramatically increase the size of our money supply, and they kept on doing it all the way through the end of October 2017…

Unfortunately for stock traders, the Federal Reserve has now decided to change course, and that means that the process that has created these ridiculous stock prices is beginning to go in reverse. In fact, according to Wolf Richter this reversal just started to go into motion within the past few days…

On October 31, $8.5 billion of Treasuries that the Fed had been holding matured. If the Fed stuck to its announcement, it would have reinvested $2.5 billion and let $6 billion (the cap for the month of October) “roll off.” The amount of Treasuries on the balance sheet should then have decreased by $6 billion.

And that’s what happened. This chart of the Fed’s Treasury holdings shows that the balance dropped by $5.9 billion, from an all-time record 2,465.7 billion on October 25 to $2,459.8 billion on November 1, the lowest since April 15, 2015

Does anyone out there actually believe that the immensely bloated balance sheet that the Fed has accumulated can be unwound without having an enormous negative impact on Wall Street?

And even more frightening is the fact that central banks all over the planet appear to be acting in coordinated fashion. I really like how Brandon Smith made this point…

An observant person, however, might have noticed that central banks around the world seem to be acting in a coordinated fashion to remove stimulus support from markets and raise interest rates, cutting off supply lines of easy money that have long been a crutch for our crippled economy. The Bank of England raised rates this past week, as the Federal Reserve indicated yet another rate hike in December. The Europeans Central Bank continues to prep the public for coming rate hikes, while the Bank of Japan has assured the public that “inflation” expectations have been met and no new stimulus is necessary. If all of this appears coordinated, that is because it is.

When interest rates are low and central banks are injecting money directly into the financial system, that tends to promote economic activity.

But when they raise interest rates and pull money out of the financial system, the exact opposite is true.

At this point Americans are more optimistic about the stock market than they have ever been before, and it is at this exact moment that the Fed is pulling the financial markets off of life support.

And it isn’t as if the “real economy” ever recovered in any meaningful way. Most American families are still living paycheck to paycheck, and a new economic crisis would push millions more out of the middle class.

For a long time I have been warning that the only reason why stock prices ever got this high was because of the central banks, and I have also been warning that they could crash the markets if they wanted to do so.

Hopefully there is nothing nefarious going on, but I do find it very strange that all of the major global central banks are moving toward tightening at the exact same time.

If things go south for the global economy in the months ahead, we will know exactly where to point the blame…

- Source, Economic Collapse Blog

Cryptocurrency Is Going To Push The Fiat Money System Over A Cliff

Rob Kirby discusses the latest happenings in the world of economics.

Rob says that economics is much like politics in the eyes of the MSM. The goal is to paint a certain reality, even if that reality doesn’t exist. For example, the goal with the economy is to paint the picture that everything is fine when we know it is not.

Rob spends some time discussing the role of cryptocurrency moving forward. Rob does not see the likes of crypto becoming a success all unto their own, but rather, he sees cryptocurrency becoming backed by something tangible, such as gold, silver and even diamonds.

Cryptocurrency is going to be what thrusts the world monetary system into chaos, and while the globalists would love to control crypto, Rob says they will not be successful in the end.

- Source, X22 Report

Strange Things Are Happening In The Paper Gold Market

Back in September the hedge funds that speculate with gold futures contracts got extremely bullish, which – since speculators are usually wrong when they’re overexcited – was a signal that gold would be going down for a while. It did:

Then things departed from the usual script. A falling gold price tends to make trend-following speculators bearish, which leads them to close out their long positions and expand their short bets. It also leads commercial players – the banks and fabricators that tend to be right at turning points – to start shifting from short to long.

But not this time. As the most recent commitment of traders (COT) report shows, speculators are staying long and commercials are staying short.

Here’s another way to visualize the process. The gray bars on the next chart represent the speculators and the red bars the commercials. Note how their positions tend to move in waves either away from or towards the middle line that represents zero. But lately their positions have flattened out.

The implication? It might take a bigger drop in gold’s price to make speculators and commercials switch sides.

This of course means nothing for gold’s long-term, highly-positive trend. But it does matter for traders who want to play the monthly or quarterly squiggles, and investors looking for entry points to buy bullion or mining stocks. That entry point might be a few weeks and another hundred or so dollars off.

- Source, Sprott Money

The Stranglehold Of Property Taxes And Stunting Economic Growth

Kory Watkins joins us in this inspirational and educational interview, Kory is running for Governor and shares his unique insights regarding property taxes and the philosophy behind being a Libertarian. We also discuss the pros and cons of removing property Tax, Cannabis Industry, gun ownership laws in Texas and much more.

- Source, Crush The Street