Crank Up The Printing Press, Shutdowns Over!

China is Making a Move Against the US Dollar

While 20-year highs for the CNY may be enough for many to question the USD's ongoing reserve status, it is clear that there are many other plans afoot that undermine the dominance of the greenback. On the global financial stage, China is playing chess while the U.S. is playing checkers, and the Chinese are now accelerating their long-term plan to dethrone the U.S. dollar. You see, the truth is that China does not plan to allow the U.S. financial system to dominate the world indefinitely. Unfortunately for us, the U.S. debt spiral cannot go on indefinitely. Our debt is growing far, far more rapidly than our GDP is, and therefore our debt is completely and totally unsustainable. The Chinese understand what is going on, and when the dust settles they plan to be the last ones standing.

- Source, Zero Hedge, read the full article here:

http://www.zerohedge.com/news/2013-10-18/9-signs-china-making-move-against-us-dollar

JPMorgan To Pay Record $13 Billion Mortgage Settlement, Criminal Case Remains

Under the guidance of Jamie Dimon, adjudged by the mainstream media to be the greatest banker the world has ever known (hyperbole accepted), a late night Friday phone call (we assume not a drunk-dial) between Attorney General Eric Holder and JPMorgan's general counsel, confirms, according to the WSJ, that JPMorgan will settle their residential mortgage bond suits with the DoJ for $13 Billion - the biggest settelement ever for a single company. Bloomberg reports that an additional $2 billion was added during the negotiations last night. Who knows: perhaps Dimon feels the same about Holder as the rest of the population and made it quite clear, at a cost of another $2 billion.

The final wording of the deal is to be finalized but as part of the deal the DoJ expects JPM to cooperate with the continuing criminal probe of the bank's RMBS issuance - which remain unresolved. The settlement is 'unsurprisingly' in line with JPM's expected litigation expenses for Q2/Q3 13 but it would appear they expect worse to come still as the total litigation reserve was recently increased.

- Source, Zero Hedge, read the full article here:

http://www.zerohedge.com/news/2013-10-19/jpmorgan-pay-record-13-billion-mortgage-settlement-criminal-case-remains

Why Gold Production is Going to Zero

In an excellent new piece entitled, “The growing 90% club and why gold production is going to go to zero”, Hinde Capital’s Co-Founder and CFO, Mark Mahaffey, asserts that it’s only a matter of time before world gold production goes to zero. That end-point is approaching quickly he implies, as the cost to pull an oz. of gold out of the ground is growing faster than ever before.

Here is an excerpt from Mark’s piece:

“If gold prices stay at the current levels for a prolonged period of time, do not be surprised if gold production falls much closer to zero. From an investor’s perspective it is a treacherous minefield. Of course, there are companies who really do have high grade ore reserves who can really claim to mine at $800/ ounce but these are very rare, maybe less than 5% of the 2000 quoted companies. The Northern Miner writes that out of their survey of 1400 Toronto listed firms, 721 currently have less than $200k cash in the treasury.

(click to enlarge)

While the big caps that make up the GDX index are unlikely to go out of business in the short term and may offer some trading opportunities for a bounce here, the very nature of this desperate business remains. Huge capital is required a long time before there is even the sniff of future cash flow. All companies can go to zero but mining companies get there much faster than most. Strangely it might well be the demise of 1000 mining companies over the next year that is the most bullish reason for the survivors.

If gold production really does fall off a cliff, the standard laws of supply and demand should be a huge positive factor for the price of gold. The sentiment in the gold market is horrendous led by the media and the price action. It is down 25% on the year. If you were looking for an asset class with a high margin of safety, (production cost) that was universally hated with no speculative long positions for a long term value portfolio allocation, you could do a lot worse than gold bullion at $1250 ounce.”

Mark also notes within the piece that:

“In the resource business where the price of gold changes by the second, there is always the possibility that in the future the price will rise above the production price and so there is an inherent call option in the stock price. Unfortunately this has to be offset by thecarrying cost of the asset. If it’s in your back garden, carrying cost is pretty minimal. If you are having to pay even skeleton salaries, keep up permitting, ownership rights, pay listing fees etc., then these carrying costs will eat in to the call option value pretty quickly.”

To read Mark Mahaffey’s article in full, visit: HindeCapital.com

-Source, Bull Market Thinking:

http://bullmarketthinking.com/hinde-capital-why-gold-production-is-going-to-go-to-zero/

The Majority of Investments Will Decline

Gold and silver will become some of the best investments in the future as they are a store of “Economic Energy”, a term coined by Mike Maloney. On the other hand, most paper assets are not a store of this economic energy, but rather what I call, “Energy IOU’s.” Energy has to be burned to create the economic activity to satisfy and pay back these paper assets.

The world is holding onto trillions of dollars of Energy IOU’s masquerading as assets that will have no future… and the future is now here.

The U.S. economy and world are heading toward an ENERGY WALL and the majority of the public and investors are not prepared for the ramifications. Certain investments will hold their value or show significant gains, while the majority will decline.

Gold and silver will be driven up to extreme levels in the future as investors switch out of increasingly worthless paper assets and into the precious metals to protect their wealth before it evaporates.

- Source, SRSRocco:

http://srsroccoreport.com/the-key-factor-to-push-gold-silver-to-new-highs/the-key-factor-to-push-gold-silver-to-new-highs/

Gold and Silver To Extreme Values

The precious metal investors are actually sitting on gold mine, and they don’t even know the real reason why this is true. Many analysts are focusing on the huge amount of debt and fiat money in the system to be invested in gold and silver, but the fundamental root cause continues to go unnoticed.

While the massive amount of debt, derivatives and fiat money are indeed excellent reasons to own the precious metals, they are the mere symptoms and not the disease itself. The advanced societies of the world were built on an economic system that can only survive if it continues to grow. Without growth, the $100′s of trillions in derivatives and debts would implode — along with it the Suburban Retail-Commercial-Housing economy.

The key ingredient that drives the growth of the world’s economies is energy. The most vital energy component of the global economy is oil. Peak oil would have come and gone, if it wasn’t for the $trillions in new debt that allowed non-commercial oil resources such as shale oil to be extracted. Basically, the U.S. and world are purchasing a percentage of oil it cannot afford.

There is a great deal of energy disinformation published on the MSM and internet. Several of the well-known alternative media analysts on the internet have been beating the drum for shale oil & gas. Even though shale energy has been a boost to the U.S. economy, it will not be long-lived — regardless of the hype and overly optimistic forecasts.

One of the most recent energy falsehoods being advertised, is that the U.S. is now the largest oil producer in the world surpassing Russia & Saudi Arabia...

- Source: SRSRocco, Read the full article here:

http://srsroccoreport.com/the-key-factor-to-push-gold-silver-to-new-highs/the-key-factor-to-push-gold-silver-to-new-highs/

Alasdair Macleod Breaks Down $680 Million Gold Order

In this episode of the Keiser Report, Max Keiser and Stacy Herbert, discuss the EBT 'free lunch' card chaos at Walmart when an 'unlimited' benefits glitch causes card holders to pile shopping carts high with 'free' goods, while on Wall-Street, the 'free lunch' card of Quantitative Easing has caused a similar misallocation of capital into property and toxic debt instruments. Finally, they discuss the world about to shut off America's 'free lunch' card, otherwise known as the Exorbitant Privilege' of having the world's reserve currency. In the second half, Max interviews Alasdair Macleod of GoldMoney.com about the $640 million sell order of gold. They also discuss Alasdair's new theory on money supply (FMQ) and his differences with Professor Fekete, a recent guest on the Keiser Report, regarding whether or not there is deflation.

- Source, Keiser Report:

http://www.maxkeiser.com/

Hierarchy of Price Fixing

In this episode of the Keiser Report, Max Keiser and Stacy Herbert, discuss the good news for the economy as compensation payments for fraud trickles into the local economy and then they introduce the concept of the People's Price Fix and a Keiser's Hierarchy of Price Fixing. In the second half, Max interviews Professor Antal E. Fekete of FeketeResearch.com about Fed induced hyper-deflation and why the American Austrians were wrong to predict that quantitative easing would cause inflation.

- Source, Maxkeiser.com

The Implosion of Debt Will be Extremely Unpleasant

This is just the beginning. As the problems in the US and the world economy start to deteriorate in 2014, I could easily see US borrowings and the Fed’s balance sheet expanding by several trillion dollars. Eventually it will be much more than that (trillions of debt) as the dollar falls, interest rates rise, and the hyperinflationary economy starts.

But the printing of money will not have any effect (on the economy). The central banks’ policies have caused debt to expand exponentially. This has greatly enhanced the wealthy, and given the masses the illusion that they are better off, when all they have is a massive debt that can never be repaid. If we just look at the richest 1% in the US, they have an average of 20% debt vs assets. But the masses, 80% of the people, have 90% debt vs assets. This, of course, doesn’t include government debt that is also the people’s debt.

The implosion of this debt will be extremely unpleasant for the world. So I am sad to say that it will be a horrible time that the world is going to go through. It will take a very long time to unwind all of this (debt), but the start (of this unwind) could be very quick. In my view we will see a very long decline.

- Source, Egon von Greyerz via King World News:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/10/9_Governments_Will_Start_Panicking_As_Chaos_%26_Crisis_Accelerates.html

Obama to Announce Janet Yellen as FED Chairman

The WSJ is reporting tonight that Obama is set to announce ultra-dove Janet Yellen as Ben Bernanke’s replacement as Fed Chairman(woman) in a Wednesday afternoon press conference.
While gold and silver have not even blinked on the news in overnight Globex/Asian trading, don’t be fooled: a Yellen nomination is MASSIVELY bullish for the metals, as Yellen’s ultra-dovish monetary policy is likely to make Helicopter Ben’s reign look like Ebenezer Scrooge has been running the Fed the past 8 years.

- Source, The Silver Doctors:

http://www.silverdoctors.com/obama-to-announce-yellen-fed-nomination-wednesday/

Matt Taibbi - Wall Street Hedge Funds Are Looting the Pension Funds

In his latest article for Rolling Stone, Matt Taibbi reports that Wall Street firms are now making millions in profits off of public pension funds nationwide. "Essentially it is a wealth transfer from teachers, cops and firemen to billionaire hedge funders," Taibbi says. "Pension funds are one of the last great, unguarded piles of money in this country and there are going to be all sort of operators that are trying to get their hands on that money."

- Source:

http://www.democracynow.org/2013/9/26/matt_taibbi_on_how_wall_street

Jim Grant - Why I'm Bullish on Gold

Jim Grant appears on Bloomberg TV and explains how credit crisis affect the market. He also explains why he is bullish on gold.

- Source, Bloomberg:

http://www.bloomberg.com/

Billionaire Predicts End of US Dollar as World's Reserve Currency

Canadian billionaire businessman Ned Goodman predicts the end of the U.S. Dollar as the world's reserve currency. He says the transition out of the U.S. Dollar will become, "...quite ugly."

- Source, Cambridge House:

http://www.cambridgehouse.com/

A Taper in a Teapot

David Franklin of Sprott's Thoughts:

This week’s meeting of the Federal Open Market Committee (FOMC) had traders, market commentators and investors almost in a frenzy as they tried to predict the outcome. This was the meeting where economists expected the Fed to announce the ‘tapering’ of its monthly purchases of $85 billion of Treasury securities and mortgage-backed bonds. According to a Bloomberg News survey of 34 economists last week, they expected the Federal Reserve to taper its monthly bond buying by $10 billion, to $75 billion.1 But they were wrong.

Market reaction was harsh when Mr. Bernanke suggested in June that it would be “appropriate to moderate the monthly pace of purchases later this year [and] continue to reduce the pace of purchases in measured steps through the first half of next year, ending purchases around mid-year”. The real damage was felt by the bond market with the yield on the 10-year note increasing from 2.16% to as high as 3%. This 39% increase in yield had bond investors facing an annual loss for only the third time in 33 years.2 However, after guiding towards a reduction in stimulus for the last four months ‘tapering’ was not to be – at least not yet.

The FOMC “decided to await more evidence that progress will be sustained before adjusting the pace of its purchases”.3 They concluded that “downside risks” to the outlook have diminished, the tightening of financial conditions observed in recent months, if sustained, could slow the pace of improvement.”4 Gold and silver rocketed upwards and the Dow Jones Industrial Average and the S&P 500 were both pushed to new all-time nominal highs. In fact, monetary accommodation in 2013 is much larger than the headlines would suggest.

According to data compiled by Bloomberg, the Fed’s balance sheet has been increasing at an average rate of $91.9 billion each month during 2013 – yes, more than the $85 billion headline number. While the Fed has been buying assets at a rate of $85 billion per month, they have also been further adding to their purchases by investing earned interest and proceeds from maturing bonds. The largest single monthly addition to their balance sheet in 2013 was during the month of April when the Federal Reserve added $114.7 billion of assets, almost $30 billion more than the stated purchases of $85 billion. These monthly additions vary given the timing of maturing bonds but the accommodation provided by the Fed is much larger than the headlines suggest.

For weeks now, gold bears have been out in force believing that ‘tapering’ would mark another leg down for gold. Given the drop in the gold price each time tapering is even hinted at, one might not be surprised at this prediction. But with tapering delayed, gold and the other precious metals appear to have found a bottom and now have limited downside.

While much ink has been spilled about ‘tapering’ of assets purchases, it now seems that this extended discussion of reducing monetary accommodation was nothing more than a ‘taper in a teapot’.

- Source, David Franklin via Sprott's Thoughts:

http://www.sprottgroup.com/thoughts/articles/a-taper-in-a-teapot/

Chris Duane - Gold and Silver Manipulation Will End With a BANG

In Chris Duane's latest video he discusses how the gold and silver manipulation that has been plaguing us for years will not end with a whimper, but with a bang. Will the system have to collapse before gold and silver are set free?