Ron Paul Calls For Abolishment of Federal Reserve!

The War on Money

If you keep your money or savings in US dollars inside of the United States, you are a risk taker of epic proportions. Have you not been paying attention to what is going on?

To begin with, the US government now employs cash-sniffing dogs at most international airports. If you are carrying more than $10,000 in cash and don't declare it to the government when coming in or out of the US, your cash will be seized. Thanks to these cash-sniffing canines, US customs officials seized $3.2 million at Boston's Logan Airport last year.

Some government apologists might say, "If you aren't doing anything wrong, why would you mind being x-rayed, sniffed, patted down, detained and questioned?"

Besides the obvious absurdity of that question, the main reason this is of concern is because in every case in history when a government has inflated its currency into worthlessness they always institute capital controls. Just ask anyone from Argentina or Italy. And it won't take much to change the rules from having to "declare" $10,000 to "not being allowed" to take $10,000 out of the country.

Not to mention that if you do declare you are taking $10,000 out of the country, who knows what kind of database you will end up on. You are obviously highly suspicious if you have more than a few hundred bucks! Only Wall Street bankers and others associated with the government are supposed to have more than a couple dollars! The most ludicrous example of the War on Money came across the newswire recently, "Feds Seek $7 million in Privately Made Liberty Dollars." The news story is only about 10 paragraphs long yet it has dozens of logical absurdities. Even in the headline is one. According to the headline, part of the reason they want to seize these dollars is because they are "privately made." Yes, we wouldn't want to compete with the private Federal Reserve banking cartel.

And I know the Constitution is passé in the US, nowadays, but how in the world can this man be in trouble for making silver coins? The constitution states:

"No state shall enter into any treaty, alliance, or confederation; grant letters of marque and reprisal; coin money; emit bills of credit; make anything but gold and silver coin a tender in payment of debts."

He is in trouble because he is making currency out of gold or silver yet, the Federal Reserve, another private organization, is not doing anything wrong by making paper currency not backed by gold and silver coin?

Apparently, the thing they "got him on" was the following:

Federal prosecutors successfully argued that he was, in fact, trying to pass off the silver coins as US currency. Coming in denominations of 5, 10, 20 and 50, the Liberty Dollars also featured a dollar sign, the word "dollar" and the motto "Trust in God," similar to the "In God We Trust" that appears on US coins.

Ignoring the fact that the dollar sign was originally used for Spanish and Mexican pesos and was stolen by the US to use for its dollars and the fact that the word dollar actually comes from the word thaler which was a silver coin minted in Bohemia, according to the Feds he was trying to pass off coins, made of silver, worth more than $35/ounce, as quarters, which are now made from 92% copper and 8% nickel, and worth $0.06 in metal value.

Boy, that's quite the racket! Passing off highly valuable silver to people who were expecting to receive near-worthless copper and nickel tokens! It's a good thing they stopped him before it was too late!

Anne Tompkins, the US Attorney who was put on this important case, stated:

"Attempts to undermine the legitimate currency of this country are simply a unique form of domestic terrorism."

Anne, if attempting to undermine the currency of the US is a form of terrorism, why has Ben Bernanke not been tracked down and sent off to the Guantanamo concentration camp?

This "news" story finished by quoting an unbiased source: a group named the Southern Poverty Law Center, a group that tracks political extremism which has apparently been tracking Bernard von NotHaus, the proprietor of the silver coin making terror enterprise. According to the story, long before the government began its investigation into von NotHaus, the group was raising concerns about the popularity of Liberty Dollars among fringe groups on the far right.

"He's playing on a core idea of the radical right, that evil bankers in the Federal Reserve are ripping you off by controlling the money supply," said Mark Potok, spokesman for the group. "He very much exists in the world of the anti-government patriot movement, whatever he may say. That's who his customers are."

The US has started another war. The war on money. Anyone with any amount of cash more that will buy them a couple NFL tickets and beers for the game is suspect. And if you are one of those deluded people who thinks the Federal Reserve is evil and is ripping you off and you buy gold or silver to protect yourself, you are a domestic terrorist.

It's going to be a fun few years ahead in the US.

Jeff Berwich
April 27, 2011
www.resourceinvestor.com

 Jeff Berwick, a self-described financial freedom fighter, is the founder of Canada's largest financial website, Stockhouse.com. He now writes the libertarian, Austrian-economics based newsletter, The Dollar Vigilante and is a regular speaker at many of the world's most important investment, resource and freedom-focused conferences where he is known as the most dangerous man in finance. He will speak at the New York Hard Assets Investment Conference on "Survive & Prosper During the Collapse of the US" on Monday, May 19.

Dollar Price of Gold Not a Good Indicator of Where It Really Stands

The U.S. investor in particular generally looks at the gold price in U.S. dollars, but in reality should be looking at the price in Euros as the recent apparent price appreciation has been mostly due to dollar decline.

We are writing today from the euro gold price point of view to illustrate what's really happening to the gold price. The gold price continued to pull back as the euro price of gold stood at €1,030.41 ahead of the gold Fix. It has pulled back from €1,041 over the last couple of days and still is far away from its peak at €1,065.

However, across the Atlantic in the U.S., the dollar continues to fall against the euro and, ahead of the first London Fix, the dollar stood at $1.4631 against the Euro and continues to look anemic. Consequently, gold is higher in US dollars at $1,507.65 but lower in the euro, before the first London Fix. 

The London Fix continues to dominate the gold price in both currencies and accurately reflects London and Asian demand. The London afternoon Fix continues to reflect both European and U.S. demand for physical gold and the main global open market supply of gold. 

Prices outside the Fixes reflect the local conditions of each market where they are quoted. Physical supplies for those markets usually come either direct from individual suppliers or from London.

How can U.S. investors see the gold price clearly in global terms?

THE FALLING DOLLAR

We find that U.S. investors struggle with a global view of gold and silver markets. In the U.S. gold is seen as having a predominantly dollar price, whereas the euro price of gold more accurately describes demand and supply at this time. As a result, U.S. investors are excited by record U.S. dollar prices and fear they may fall back.

But U.S. dollar record prices are not due to record gold demand but to the falling dollar.

A record gold price in the euro was seen a while back at €1,065. Should the U.S. dollar fall to $1.50 against the euro we must see the dollar price of gold stand at $1,597.50 if gold were to merely equal record euro prices. If the dollar continues to fall, the gold price will move up through $1,600 and more, without moving up in the euro!

UNDERSTANDING WHY

Until U.S. investors adjust to these realities, we expect only the more globally focused U.S. investors to value gold as a protection against a falling dollar. The global viewpoint will look at the dollar as just another currency, albeit the world's main one. With its structural problems, it has virtually ceased to measure value. It is now both the tool, as well as the consequence, of the U.S. monetary authorities.

As a tool, there is no doubt that the U.S. stands to gain considerably in international trade if the dollar continues to fall. With the falling dollar, the price of U.S. goods in foreign currencies falls too. The Trade Balance of the U.S. has been a fact of life for more than a decade and is unlikely to return to a surplus, simply because U.S. manufacturing has been outsourced to places like China and other parts of Asia, by U.S. companies seeking lower labor costs and greater profits. 

This remains a structurally unchangeable fact until U.S. wages, measured in foreign currencies such as the Yuan, are cheaper than foreign wage levels. No doubt then U.S. manufacturers will then want to relocate back home. By then, Asian manufacturing companies will be so entrenched that U.S. companies will find it difficult to compete with the people they taught. The dollar has to tumble considerably more for this to be even remotely attractive to U.S. manufacturers.

As a consequence of loose monetary policy out of consideration for the U.S. economy, a near complete disregard for the dollar's role internationally, the dollar has and will cheapen much more. That will be the case if other nations' monetary authorities permit it to [without trying to undermine their own exchange rates]. If they don't, currencies will cheapen together making precious metals still stronger. 

By implication, a global ‘reserve currency' has to serve as a currency that is capable of defining the value of products and remaining stable enough for prices to provide sufficient profits for businesses to continue. An unstable declining currency clearly fails to do that. It will eat profits up [Often between 5 and 30% of price]. For instance, a price set when the dollar was at $1.25 to the euro may incorporate such margins. If it falls to $1.50 against a dollar-priced product, the entire margin disappears. Meanwhile, where an exporter prices in the dollar [which is usually the case] and buys forward exchange rate cover to protect his margins, his contract costs will rise to reflect the instability of the dollar and his costs creep higher and higher over time. This makes manufacturing an exchange rate gamble or extra cost to his business that raises prices. But he does have the option of not using the U.S. dollar in international trade. But this lowers the use of the dollar in international trade, eventually lowering the exchange rate of the dollar even more.

We believe that the current myopic view of the gold price in the U.S. dollar will continue for a while still, until there is a shock that will force a more global perspective. It may happen slowly or suddenly. The earlier investors arrive at this viewpoint, the greater the profits they will make out of the precious metals and the more effectively they will protect their existing wealth against a falling dollar. 

Julian Phillips
April 27, 2011
www.mineweb.com
BENONI

Dollar Collapse Ahead!?

US Commerce Department has released dim numbers for US growth in the first quarter. If you consider that the economy has to grow at a rate of 2.5% just to create enough jobs to accommodate a growing population and more efficient workers, that's not good news for unemployment. Peter Schiff, president of Euro Pacific Capital weighs in.

Ron Paul: People Will Panic out of the Dollar

Ron Paul is America's leading voice for limited, constitutional government, low taxes, free markets, a return to sound monetary policies, and a sensible pro-America foreign policy.

Gerald Celente: 'Bernanke Devaluing the Dollar'

Federal Reserve Chairman Ben Bernanke spoke to the press today during an undeniably dire time for the American economy. During that very speech, the US dollar hit a three year low and gas prices rose yet again. Should Americans be concerned? Absolutely, says Gerald Celente, director at the Trends Research Institute. While Bernake may have taken to the press, Celente says Ben's "jive talk" shouldn't be trusted as he devalues the dollar and distastes the economy.

Silver Demand Is Here And It's Booming!

Silver Price Plunges, Sprott Refutes “Top” Calls

SILVER PRICE NEWS – The silver price plunged $1.89 to $45.08 Tuesday as the sell-off in the price of silver intensified.  Just one day after nearly reaching $50 per ounce for the first time since 1980, the silver price has now fallen 9.5% in less than two days.  Nonetheless, the silver price remains higher by 45.7% year-to-date, far outpacing the large majority of other asset classes.

Liquidation in investments tied to the silver price, such as silver ETFs and silver stocks, has been fast and furious.  The iShares Silver Trust (SLV), the world’s largest silver ETF, retreated $1.71, or 3.7%, to $44.12 per share on Tuesday.  The Global X Silver Miners ETF (SIL), a basket of mid- and large-cap silver stocks, dropped $0.81, or 2.8%, to $27.74 per share.  Notable decliners alongside the silver price included SIL components Hecla Mining (HL) and Pan American Silver (PAAS), with losses of 1.9% and 1.3%, respectively.

The sharp negative reversal in the silver price this week, coupled with the near-parabolic advance in recent months, has brought out a chorus of calls for a top in the price of silver.  Several investment professionals on Minyanville.com – including Todd Harrison, Fil Zucchi, and Jeff Cooper, among others – have initiated short positions in investments tied to the silver price, based on recent bearish technical indicators and extremely bullish sentiment.

Cooper noted that while “this doesn’t mean the silver bull market is over,” it does indicate that “there is a better than average likelihood of a wicked washout if there is follow through from Monday’s reversal” in the silver price.

While the folks at Minyanville are deservedly well respected in the financial community, when it comes to the silver price it is worthwhile to also check with those that have a more concentrated focus on precious metals.  One of the foremost silver price bulls over the past decade has been Eric Sprott, founder of Sprott Asset Management.  In his firm’s latest “Markets At A Glance,” Sprott and colleague Andrew Morris reiterated their very bullish thesis on the silver price in spite of its already-substantial climb.

Although the gold/silver ratio has fallen from over 60 to its current level near 30, Sprott contended that he would not be surprised to see the ratio reach single digits “before settling into a more sustainable equilibrium.  “All indications lead us to believe that there is now roughly an equal amount of investment flowing into silver and gold on a dollar-for-dollar basis,” Sprott continued, “And although the price ratio of silver to gold has fallen substantially since the highs of 2009, our analysis strongly suggests that this ratio must move lower to restore a fundamental balance between supply and demand.”

Sprott went on to provide a quantitative analysis to demonstrate that silver has only “8% of the capacity for investment that gold does despite having equal if not more dollars flowing into it,” as well as discussing other favorable supply-demand factors for the price of silver.

While Sprott did not provide a specific silver price target, his forecast for a substantially lower gold/silver ratio, coupled with his continued bullish outlook on gold, implies much higher silver prices ahead.  “The fiat money experiment has failed,” Sprott wrote.  “And in this context, we believe the Market has assigned world reserve currency status to gold – not USD, not EUR, and not JPY. In our opinion, gold’s continued appreciation vis-à-vis every currency is assured because the great flight from fiat has only just begun. Like gold, silver also has a long monetary history, and as such, investors are now also buying silver as protection from the ravages of fiat currency debasement.”

“Yet, when compared to gold,” Sprott continued, “it is silver that offers the most attractive value proposition by virtue of the gross mispricing of its scarcity, which, we might add, has existed for many years… as this new bimetallic standard takes root, silver investors will continue to be justly rewarded with marked outperformance. We truly believe that this is the investment opportunity of a lifetime.”

Source

Peter Schiff:'There Is More Capitalism in Communist China Than There Is in America'

April 25, 2011 CNN

Keiser Report: Fleeing Dollar Flood & Fraud

This week Max Keiser and co-host, Stacy Herbert, report on the world fleeing the dollar flood and the dollar fraud and about Jamie Dimons worst nightmare. In the second half of the show, Max talks to Matt Taibbi about the real housewives of Wall Street.

Roberts:'America Must Blame Itself For Economic Fall to China'

As the IMF predicts China to overtake the US as the economic leader by 2016, who can we look to blame for this downfall of the dollar? Former Regan administration official and ex-US Assistant Secretary of the Treasury Paul Craig Roberts says America has no one to blame but itself and that this comes as no surprise.

IMF bombshell: Age of America Nears End!

BOSTON (MarketWatch) — The International Monetary Fund has just dropped a bombshell, and nobody noticed.

For the first time, the international organization has set a date for the moment when the “Age of America” will end and the U.S. economy will be overtaken by that of China.

IMF sees China topping U.S. in 2016

According to the latest IMF official forecasts, China's economy will surpass that of America in real terms in 2016 — just five years from now. Brett Arends looks at the implications for the U.S. dollar and the Treasury market. And it’s a lot closer than you may think.

According to the latest IMF official forecasts, China’s economy will surpass that of America in real terms in 2016 — just five years from now.Put that in your calendar. 

It provides a painful context for the budget wrangling taking place in Washington, D.C., right now. It raises enormous questions about what the international security system is going to look like in just a handful of years. And it casts a deepening cloud over both the U.S. dollar and the giant Treasury market, which have been propped up for decades by their privileged status as the liabilities of the world’s hegemonic power.

According to the IMF forecast, whomever is elected U.S. president next year — Obama? Mitt Romney? Donald Trump? — will be the last to preside over the world’s largest economy. 

Most people aren’t prepared for this. They aren’t even aware it’s that close. Listen to experts of various stripes, and they will tell you this moment is decades away. The most bearish will put the figure in the mid-2020s. 

China’s economy will be the world’s largest within five years or so.

But they’re miscounting. They’re only comparing the gross domestic products of the two countries using current exchange rates. 

That’s a largely meaningless comparison in real terms. Exchange rates change quickly. And China’s exchange rates are phony. China artificially undervalues its currency, the renminbi, through massive intervention in the markets. 

 The comparison that really matters

The IMF in its analysis looks beyond exchange rates to the true, real terms picture of the economies using “purchasing power parities.” That compares what people earn and spend in real terms in their domestic economies. 

Under PPP, the Chinese economy will expand from $11.2 trillion this year to $19 trillion in 2016. Meanwhile the size of the U.S. economy will rise from $15.2 trillion to $18.8 trillion. That would take America’s share of the world output down to 17.7%, the lowest in modern times. China’s would reach 18%, and rising.

Just 10 years ago, the U.S. economy was three times the size of China’s.

Source

Precious Metals - On the Edge with Max Keiser

Brad Cooke, CEO of Endeavour Silver, is Max's guest in this edition of Press TV's On the Edge with Max Keiser where they have an excellent discussion about precious metals. Enjoy the show.

Bob Chapman's Friday Report on Gold & Silver

Europe struggles with financial weaknesses, but other nations have those problems as well, 4 trillion for Europe bailout a prediction, money policy indicates that prices have a lot further to fall, you must understand the bigger picture and the motivations of the powerful to understand where the economy is going, Japan seeks to avoid problems, but must create more debt.

Keiser Report: As Gold As Gold !

This time Max Keiser and co-host, Stacy Herbert, report on downgrades, gold bars and third worlds. In the second half of the show, Max talks to Taki Oldham, director of The Billionaires Tea Party, about tea parties, astroturfing and Ayn Rand.

Jim Rogers: All Parabolic Moves End Badly

INTERNATIONAL. Legendary global investor and chairman of Singapore-based Rogers Holdings, Jim Rogers warned that if silver continues to go up like it has been over the past 2 or 3 weeks and reaches triple digits in 2011, he will probably start to think about selling because then 'you've got a bubble'.

Speaking to Financial Survival Radio, Rogers said: " My hope is, silver and gold and all commodities will continue to go up in an orderly way for another ten years or so, and eventually the prices will be very, very high".

"I hope something stops it going up in the foreseeable future and we have a correction," he added.

Explaining his wish, Rogers warned that "a parabolic move and all parabolic moves end badly".

Most investors don't notice something until there's a good, nice bull market in place, such as with gold and silver, he said, adding after ten years of price rises in gold, people are starting to notice.

"Eventually, everybody's going to be owning gold, and then we'll all have to sell our gold. But that's a long way from now, he predicted.

The legendary investor doesn't consider the recent increases in precious metals as parabolic.

"If silver continues to go up like it has been over the past 2 or 3 weeks, yes, then it would get to triple digits this year. And then we'll have to worry. It's not parabolic yet". 

"There's never one in history that hasn't popped," he noted.

The price of gold bullion jumped above US$1500 per ounce on Wednesday, setting new Dollar and Sterling highs but falling sharply against the Euro as the single currency rose to its highest level since 2009.

"Silver prices remain very strong, but seem to have run ahead of the fundamentals," says bullion bank Scotia Mocatta's latest Metal Matters monthly.

With silver setting its 8th new 31-year high in 13 trading days so far in April, "If gold corrects expect silver to follow," says Scotia. "Longer-term [gold] investors generally seem comfortable to hold their existing positions...[yet] the level of interest is low considering how much uncertainty there is in the market and how weak the dollar has been."

Rogers advises watching the dollar and the price action in deciding when it is time to exit precious metals.

"Maybe the US dollar is going to become confetti in 2011, and if that's the case and silver goes to US$150, then obviously I wouldn't sell my silver. It would be the US dollar which is collapsing. But if silver goes up... without currency collapse, I would be very worried," he told Financial Survival Radio

"There's no question in my mind that all commodities will be a huge bubble someday. But I don't think that bubble is going to happen in 2011," Rogers added.

Following last week's news that the University of Texas' endowment managers have switched from a derivatives to physical allocated gold position, "One of the most interesting highlights is the massive growth in physical gold bar investment," writes David Wilson at French bank Societe Generale, commenting on the 66% jump in gold-bar sales reported by the GFMS consultancy for full-year 2010 worldwide.

"If suddenly all the pension funds wake up and say, I've got to own gold, they may start thinking about it more and more. But the thing that's been getting people's attention is the fact that gold has been going up so much. That's the wrong way to invest. Where were these guys five, ten years ago? asked Rogers.

"That's when they should have been doing all of this".

April 20, 2011
www.bi-me.com

$5,000 Gold & $300 Silver are Credible Numbers!

Q: What do CNBC, George Soros, Warren Buffet and every other mainstream investment commentator on the price of gold have in common for the last ten years?

A: They are all wrong.

All the time, every year, ten out of ten years in a row. If you continue to  pay attention to such disinformation, you will lose money. Definitely. No question. Guaranteed.

Each and every year, their vapid comments on the future gold price prove to be complete bollocks, yet year after year, and day after day, millions of readers watchers and listeners tune in for another dose of horribly incorrect information.

These days, the number of perpetually inaccurate predictions forecasting an end to the gold boom are thoroughly drowned out by the now multitudinous voices screaming from the rooftops for gold to go much higher. About 90 percent of that is the herd mentality at work. Early predictions for $1,000 gold, which seemed extreme and outlandish just two years ago, turned out to be very conservative. So its easy now to lay claim to being “the one who predicted the gold bull market”.

Bandwagon riders aside, there are compelling reasons to support a much higher gold price, and more importantly, a narrowing of the ratio between the gold price and the silver price. One year ago, the silver to gold ratio was 63 ounces of silver for every ounce of gold. Today that ratio is 35:1. Its fallen by nearly half in one year.

In terms of pure performance, whereas gold has delivered a solid gain of 26.51% in the course of the last year, silver has outshone gold spectacularly, turning in a gain of 123.55%, making it the commodity trade of the year by far. The effect of that performance is to dramatically alter the perception of investors in terms of its desirability as a precious metal. Its long been a psychological barrier to silver’s progress, in my opinion, that a precious metal could be had so cheap.

But as the prices of both monetary metals grows, and their price differentials narrow, investors want an idea of where the future is heading in terms of these prices. Can they continue to grow so dramatically in price, or is there a point at which their price appreciation curve will level out and become more incremental? Or, is there a point at this the upward price curves will plunge steeply downward? And at what point, if every, will the price curves of silver and gold converge? What exactly is the appropriate ratio of gold versus silver? Do we buy bullion, coins, ETF’s, Gold Funds, Senior Miners or Junior Explorers? Which is safest? Which is riskiest?

First lets consider the ratio question. If the ratio suggested in the title were to become reality, that would mean a ratio of only ten ounces of silver to buy one ounce of gold. If the ratio curve were to continue climbing in favour silver at the present rate, it would approach 10:1 within another year.

But if the ratio were to reflect numbers pegged to certain fundamental realities, then perhaps we could deduce a more rational price differential with better certainty. According to John Stephenson’s Little Book of Commodity Investing, there is 16 times more silver in the earth’s crust than gold.

So on that basis alone, the correct  price ratio is arguably 16:1. Silver bulls like to point out that silver is unique among monetary metals because of its wide ranging industrial applications, as well as in photography and jewelry. As the silver price continues to consolidate its price differential with gold, it is likely that process modification and substitution will occur wherever possible in the manufacturing supply chain to replace silver, which will dampen industrial demand. Thanks to silver’s unique chemical attributes, however, that effect will be muted.

2009 statistics from the Silver Institute show that global supply of silver was more or less equal to the global demand for silver from all classes including manufacturing and bullion minting. Government stocks of silver are estimated to have fallen by 13.7 million ounces over the course of 2009, to reach their lowest levels in more than a decade. Russia again accounted for the bulk of government sales, with China and India essentially absent from the market in 2009. Regarding China, Gold Fields Mineral Services states that after years of heavy sales, its silver stocks have been reduced significantly.

If the silver ratio is heading to 16:1, that implies a near term price range of $90 - $100 per ounce.

If gold goes to $5,000 an ounce, and the silver/gold price ratio remains 16:1, there’s silver at $312.50 per ounce.

And what, pray tell, is coming down the pike to support a gold price of $5,000?

First and foremost, the United States dollar.

The whole global financial system is trapped in a situation whereby we have no choice but to permit the United States to continue counterfeiting money. There is no single political force or voice or even prospect with the knowledge and the power to put a stop to the insanity into which we continue to spiral on a daily basis. That means, despite the unanimous chorus from the financial media mainstream, which anesthetizes the human race in an effort to thwart violent protest by design, the fabrication of electronic dollars will continue apace. For years.

In terms of strict nominal value, that implies a proportional increase in the prices of, well, everything. Inflation is the direct outcome of monetary expansion in the absence of economic growth. Therefore, gold and silver will be direct beneficiaries of such policy.

At the same time, sovereign and large capital pool (LCP) investors in U.S. debt are seeking to exit their holdings of U.S. dollars, The world’s largest bond fund, PIMCO, and its acerbic chief Bill Gross, are now shorting the U.S. dollar. China has stated repeatedly that it will reduce its holdings of U.S. debt. This is sending a signal to the rest of the sovereign wealth and LCPs that the U.S. dollar should be abandoned. That means, when the convulsions that seize the global financial system, such as that of 2008, manifest themselves, investors will flee less and less to the U.S. dollar, and more and more to other currencies – especially gold and silver.

So not only does the price of gold appreciate in strictly nominal terms, but demand for it is growing even as it grows exponentially in price. That’s why, given this illogical yet nevertheless existing stupidity, the more expensive gold and silver get, the greater will be their demand as a replacement for U.S. dollar denominated safe haven asset classes.

The third major factor that is going to drive gold to $5,000 and silver through $300 is related to the first two. Governments, always reactive and never proactive, will eventually start to ratify gold and silver as official currency alternatives as a result of public pressure.

The decision by the people of Utah to do just that was big news recently, even though technically and legally, it always was legal tender in that state. It is this final legitimizing step by regional governments that will open the eyes of the otherwise hypnotized American public. For now, the move is painted as fringe by the idiotic mainstream, who are unwitting pawns for the financial services industry – U.S. Federal Reserve – U.S. Treasury trio of economic under-miners.

But contrary to global public perception, this has been a recurring theme in the United States economy, pretty much from day 1.

The Daily Astorian, a newspaper of the day in Astoria, Oregon, on May 9th, 1876 published a story the following of which is an excerpt:

The people of this country are tolerably familiar with depreciated money. The great mass of them have had nothing else for the last fourteen years. We are accustomed to depreciated Greenbacks, National Bank Notes, Nickels and Silver, and there are those living who can recall the time when Gold was worth less than Silver.

The biggest perpetrators of what we, the people, must soon designate as criminals, else suffer the continuing consequences of no jobs and no future, are the United States Federal Reserve, the United States Treasury, The Commodities and Futures Trading Commission, and the Securities Exchange Commission.

“Oh but wait,” say some. “The United States Federal Reserve is not a government body….its private.” And? The Federal Reserve is nothing more and nothing less than the off-balance sheet entity of the U.S. Treasury that permits the illegal fabrication of dollars out of thin air without prosecution. Of course this off-balance sheet entity is not an official government body. It was designed that way, exactly as Enron set up LJM L.P., to hide losses and perform sundry distasteful and illegal acts in an effort to support its parent entity.

When an entity is formed specifically to operate outside of the publicly elected offices of government, but is given dominion over the most important property of the voting public – its money – and when that entity acts in direct opposition to the interests of the public to whom it owes a fiduciary duty, then its status as government or private really becomes irrelevant. All that matters in terms of its identity is its treasonous and fraudulent activity.

The management of Enron went to jail for their larcenous culture of hiding from shareholders the true extent of their losses, and the illegal nature of their everyday operations. With a bit of luck and perseverance, the same fate will yet befall Bernanke, Paulson, Summers, Rubin, Geithner, Gensler, Shapiro and the rest of the Ivy league thieves. In the meantime, the best defense against their intentional destruction of the United States currency is selling dollars to buy gold for capital preservation and silver for low-risk capital appreciation.

The day will come when, instead of teaching that these leaders were nobly trying to ease the pain of financial forces beyond their control, today’s politicians will instead be accurately portrayed as naïve, negligent, and just plain stupid populists whose ignorance of real economic matters  was exactly the ingredient necessary to permit the psychopathic and misanthropic banking community to form the financial policies of their governments. Unfortunately, the only ones likely to be alive by the time that happens are now in diapers.

By:James West

After ‘Storm’ Passes Gold Will Still Be Strong!

Analysts are calling the recent spike in gold prices the “perfect storm,” with global political turmoil, a weak dollar; and growing inflation in the Eurozone, emerging economies, and in the United States—despite the fact the U.S. Federal Reserve is still in denial. What they are implying is that gold is being "propped up" by a steady flow of negative information. The real story is that the dollar is being propped up by history's biggest credit bubble.

The gold spot price has gone up 5 percent since April 1, falling just short of $1,500 an ounce at close of trade today. Futures have been even more volatile. And there’s no doubt that when wars and civil wars are breaking out in country after country, inflation is raging and the U.S. dollar is dropping, investors are turning to the safe haven of gold, as they have throughout history.

But to dismiss gold’s rise as a “perfect storm,” as though we’ll just ride it out and gold prices will drop back to "normal" again, is to ignore the larger and more stable trends here. Those of us who got on this gold bull back at the turn of the millennium have ridden it steadily upward, with only a few short-term dips along the way. Now the price hikes are picking up steam, but that’s only the typical pattern for what is arguably the second phase of the classic bull market, when the large institutional investors and central banks begin to catch a clue. No doubt natural and human-made disasters will bring added volatility, but when things settle down in the world, or humanity adapts to the chaos, gold still has a long way to climb. For one thing, valued in inflation-adjusted dollars, gold is worth only half what it was at the peak of the last bull, as reported by CNN’s Money.com.

“Gold has been on a tear since late January, when the metal traded as low as $1,320 an ounce. But the rally kicked into high gear this week, with gold touching new highs every day except Monday. Of course, the records this week are not adjusted for inflation. Gold rose to $825.50 per ounce on Jan. 21, 1980, which is $2,211.65 in today's dollars, according to the Minneapolis Fed Calculator.”

But there are lots of other factors affecting the market today that weren't part of the mix in 1980.

• There is far more currency in circulation today than there was in 1980—and with the Fed’s quantitative easing and other easy-money policies, the quantity continues to grow. Throughout history, the fate of fiat currencies is always the same: The free market revalues all that debased currency to account for all the gold. Today, there is more than ten times more currency in circulation than there was in 1980.
• The world has more investors today than it did in 1980. Then, the Soviet Union and China prohibited private investment, and in emerging economies such as those of India and Latin American nations simple day-to-day survival was a struggle. Today, the world has an “investor mindset.” The number of people allowed to and inclined to buy gold has increased exponentially.

All these fundamental realities say this gold bull still has a long way to climb. Sure, wars and insolvent governments and spiking inflation will push prices up as well. But even when those short-term crises have passed and the reporters have all gone home, gold and silver will still be the best way to protect your wealth for the long haul.

Source

Jim Rogers: "US will lose economic war"

China has become the world's fastest growing economy, what can the US be taught from the Chinese as the US economy continues to struggle? Jim Rogers, co-founder of the Quantum Fund says that US citizens should save and invest their money as their Chinese counter parts have. The Chinese are saving and investing an average of 35% of their income, taking an age old US principle and using it to their advantage.

Inflation Explained !!

David Morgan Analyzes a Dollar Collapse, ROLLOVER 1981

Marc Faber: Future Value of US Dollar Will Be Zero

World Bank President: 'One Shock Away From Crisis'

The president of the World Bank has warned that the world is "one shock away from a full-blown crisis".

Robert Zoellick cited rising food prices as the main threat to poor nations who risk "losing a generation".

He was speaking in Washington at the end of the spring meetings of the World Bank and International Monetary Fund.

Meanwhile, G20 finance chiefs, who also met in Washington, pledged financial support to help new governments in the Middle East and North Africa.

Mr Zoellick said such support was vital.

"The crisis in the Middle East and North Africa underscores how we need to put the conclusions from our latest world development report into practice. The report highlighted the importance of citizen security, justice and jobs," he said.

He also called for the World Bank to act quickly to support reforms in the region.

"Waiting for the situation to stabilise will mean lost opportunities. In revolutionary moments the status quo is not a winning hand."

Food price changes Q1 2010 to Q1 2011
Source: World Bank Development Prospects Group
Maize	74%
Wheat	69%
Palm oil	55%
Soybeans	36%
Beef	30%
Rice	-2%

At the Washington meetings, turmoil in the Middle East, volatile oil prices and high unemployment were also discussed.

IMF chief Dominique Strauss-Kahn raised particular concerns about high levels of unemployment among young people.

"It's probably too much to say that it's a jobless recovery, but it's certainly a recovery with not enough jobs," he said.

"Especially because of youth unemployment... there is now a risk that this will be turned into a life sentence, and that there is a possibility of a lost generation," he said.

source

6 Banks Shuttered; Makes 34 Closed in '11

WASHINGTON (AP) -- Regulators on Friday shut down a total of six banks in Alabama, Georgia, Minnesota and Mississippi, boosting the number of U.S. bank failures this year to 34. There were 157 bank closures in 2010 amid the shattered economy and piles of bad loans.

The Federal Deposit Insurance Corp. seized the banks, the largest by far being Superior Bank, based in Birmingham, Ala., with $3 billion in assets and about 70 branches in Alabama and Florida.

A newly chartered bank subsidiary of Houston-based Community Bancorp LLC was set up to take over Superior Bank's assets and deposits. The new subsidiary is called Superior Bank NA.

In addition, the FDIC and Superior Bank NA agreed to share losses on $1.84 billion of the failed bank's loans and other assets.

Superior Bank received $69 million in taxpayer funds in December 2008 under the government's financial bailout program, Treasury Department data show.

Its failure is expected to cost the deposit insurance fund $259.6 million.

Also shuttered were Birmingham-based Nexity Bank, with $793.7 million in assets; Bartow County Bank of Cartersville, Ga., with $330.2 million in assets; New Horizons Bank in East Ellijay, Ga., with $110.7 million in assets; Rosemount National Bank in Rosemount, Minn., with $37.6 million in assets; and Heritage Banking Group, based in Carthage, Miss., with $224 million in assets.

AloStar Bank of Commerce, also based in Birmingham, agreed to assume the assets and deposits of Nexity Bank. Hamilton State Bank, based in Hoschton, Ga., is assuming the assets and deposits of Bartow County Bank. Citizens South Bank, based in Gastonia, N.C., is acquiring the assets and deposits of New Horizons Bank. Central Bank, based in Stillwater, Minn., is assuming those of Rosemount National Bank. Trustmark National Bank, based in Jackson, Miss., is taking those of Heritage Banking Group.

In addition, the FDIC and AloStar Bank of Commerce agreed to share losses on $384.2 million of Nexity Bank's loans and other assets. The agency and Hamilton State Bank are sharing losses on $247.5 million of Bartow County Bank's loans and other assets. The agency and Citizens South Bank are sharing losses on $84.7 million of New Horizons Bank's assets. The FDIC and Trustmark National Bank are sharing losses on $156.4 million of Heritage Banking Group's assets.

The failure of Nexity Bank is expected to cost the deposit insurance fund $175.4 million. The failure of Bartow County Bank is expected to cost $69.5 million; that of New Horizons Bank $30.9 million; Rosemount National Bank, $3.6 million; and Heritage Banking Group, $49.1 million.

Georgia has been one of the hardest-hit states for bank failures. Sixteen banks were shuttered in the state last year. The shutdowns of Bartow County Bank and New Horizons Bank brought to eight the number of bank failures in the state this year.

California, Florida and Illinois also have seen large numbers of bank failures.

The 157 bank closures last year topped the 140 seized in 2009. It was the most in a year since the savings-and-loan crisis two decades ago.

The FDIC has said that 2010 likely would mark the peak for bank failures. Already this year the pace of closures has slowed: By this time last year, regulators had closed 50 banks.

The 2009 failures cost the insurance fund about $36 billion. The failures last year cost around $21 billion, a lower price tag because the banks that failed in 2010 were smaller on average. Twenty-five banks failed in 2008, the year the financial crisis struck with force; only three were closed in 2007.

From 2008, the year the financial crisis struck, through 2010 bank failures cost the fund $76.8 billion.

The growing number of bank failures has sapped billions of dollars out of the deposit insurance fund. It fell into the red in 2009, and its deficit stood at $7.4 billion as of Dec. 31.

The number of banks on the FDIC's confidential "problem" list rose to 884 in the final quarter of last year from 860 three months earlier. The 884 troubled banks is the highest number since 1993, during the savings-and-loan crisis.

The FDIC expects the cost of resolving failed banks to total around $52 billion from 2010 through 2014.

Depositors' money -- insured up to $250,000 per account -- is not at risk, with the FDIC backed by the government. That insurance cap was made permanent in the financial overhaul law enacted in July.

Source

David Morgan: The Play in Silver

David Morgan Interview on Fox News, April 15th.

The Reason Silver Has Been Rising Faster Than Gold

Analysis of the different advance which has occurred in the silver price vis-à-vis gold in the past few months where the former has substantially outperformed the latter.

Silver is breaking new records at around $40 and gold is touching new highs of close to $1,460. Looking back, over the past few years we have seen gold rise from around $312 to $1,460 a rise of 4.68 times and silver from around $6 to $40 a rise of 6.67 times. 

But this does not give a clear picture, so we went back over the last year and what did we see? Since early 2009, gold has moved from $900 to $1,460, a respectable 62%. Over the same period silver has moved from $10 to nearly $40 a remarkable 400%. Why the difference in relative performance?

Both metals have moved as money. Gold and silver Exchange Traded Funds have attracted massive investments in the developed world where trust in the monetary system is far higher than it is in the emerging world. But it was the underlying gold and silver that attracted investors. Waning confidence in the value of paper currencies gave way to demand for precious metals as a store of value retainers for investors. 

Gold and silver have substantial differences as value retainers which help us to identify why the two metals have differed so much in performance.

• Gold is and has always been the 'senior' monetary metal held by Central Banks as money until 1971 and after that as a valuable reserve asset in the vaults of central banks.
• Silver was rejected as money and as a reserve asset by the mid-fifties, despite it being treated as money throughout the ages before that.
• Both gold and silver have been attacked as money through 'official' sales from the seventies until last year. But gold was sold to undermine the reality that it is money. Silver was sold out from reserves almost completely by central banks discarding it as money, completely.
• Apart from a brief period when Egypt was at its height and supplies of silver less than those of gold, gold has always been in far shorter supply than silver and considered far more valuable than silver.
• Silver in the past few decades has been seen as a commodity, mined mainly as a by-product of base metal mining, with only 30% mined in a pure silver mine.
• Most silver is consumed whereas gold is not, which will continue to be the case until less expensive substitutes are found. This will only happen at far higher prices still.

GOLD AS AN INVESTMENT

Gold has always been the precious metal of choice for wealthy individuals, institutions and central banks. It has never been abandoned as such. Even when "Official" selling was at its peak, central banks sold only what they thought was sufficient to add credibility to the paper currency they were pushing to the centre of the system, first to add credibility to the dollar then after 1999 to the euro. With those tasks completed, Central Banks are now either holders or buyers of gold. 

The amount sold in most cases was around 20%, but in the case of the uninspired then-Chancellor Brown of the U.K.'s case, half of Britain's reserves were sold. The largest holders of gold sold none or only small amounts. So while it was underpriced and we believe still is, did not see its price 'crushed' completely. 

The path back to investment acceptance is a slow one and a long one with most of the journey still to come. We believe that we are on the brink of major changes in price levels in 2011 and beyond.

SILVER AS AN INVESTMENT

Silver had not really been an investment metal until 2004 and not a significant one until 2009.

It was a commodity metal in so short a supply that the Hunt brothers of Texas felt they could corner the market. In 1979, they took the silver price from its high of $8 an ounce [it had doubled since it stood at $4 an ounce in the mid- 1970s' already] to $50 an ounce by the early 1980's. It then fell all the way back to $5 an ounce thereafter as the Hunt Brothers found they were unable to sell the silver until prices had fallen back to those levels where they stayed until October 2003. Until 2009, it was relegated to the sidelines as an investment metal. 

It started to regain popularity as an investment metal because it began to be considered as "poor man's gold" as the gold price rose out of reach of the poorer investment classes. 

For instance, in India until its middle classes began to grow substantially, 70% of all gold bought was bought by the agricultural sector, whose income was directly related to the quality of the monsoon rains. When profits were good, they found their way into property and into gold, As the price rose, the quantity of gold available to such people fell. Then $1,500 bought five ounces of gold, but with gold at $1,460, it only buys just over 1 ounce of gold. 

In India, precious metals are used in commercial transactions so the divisibility of silver relative to gold was far greater and more flexible. It also remained affordable in larger quantities. After all, now one ounce of gold buys 36.5 ounces of silver. So, silver remains affordable far lower down the economic ladder than gold does. It therefore can attract a far wider market than gold does currently at retail levels. Bearing in mind that precious metals are attracting a huge and growing market in the emerging parts of the world, the demand, as a wealth protector, at the retail end of the market is expanding rapidly.

CATCH-UP

It would therefore be wrong to still categorize silver as a monetary metal. Its day will come, but not until its price is much higher and not until paper currencies have lost considerably more credibility than at present. 

The most difficult part of silver's rise as a wealth protector has been from October 2004 to October 2008, from when its price moved from $5 an ounce to a peak of over $20 an ounce then to fall back to than less $10 an ounce before taking off on its current path. The fall coincided with the onset of the 'credit-crunch.

All the while, demand from the photographic sector has waned. More importantly, the uses of silver have morphed from discretionary demand to a need. Even in a downturn, the demand for silver will remain strong as its uses are considered vital now.

So as a non-monetary, more volatile precious metal, its future then was far cloudier than now. The transition from those days to 'poor man's gold was its re-birth as an investment metal. While we believe it has now returned as such to stay, it still has a lot of catching up to do. By catching up we mean that it still has to return to the concept fully, that it is a lower category investment metal respected from institutions [eventually by central banks] as well as the retail end of the market. 

Gold is already at that point. This does not mean that the gold price has reached a ceiling of any kind. It does mean that the gold price will rise relative to the value of currencies from now on with its metallic qualities being far in the background. Silver is still a long way off from that point.

Julian Phillips
April 13, 2011
www.mineweb.com

Max Keiser Bravely Fends Off the Financial Trolls

Some of the Deadliest US Corporations!

Coca Cola

America's favorite soft drink, deadly? Well, even if you choose to overlook the childhood obesity epidemic and how soft drinks market to children to get them to buy something really, really bad for them, Coca Cola corporation has wrought devastation in India, where its factories use up to one million liters of water per day, leaving tens of thousands of nearby residents dry during the drought months. Then the factories dispose of the wastewater improperly, contaminating whatever water is left.  A lawsuit in 2001 accused Coca Cola of hiring paramilitaries in Columbia which suppressed unionization in the cola plant there through intimidation, torture and murder.

 Chevron

 Several big oil companies make this list, but Chevron deserves a special place in Hell. Between 1972 to 1993, Chevron (then Texaco) discharged 18 billion gallons of toxic water into the rain forests of Ecuador without any remediation, destroying the livelihoods of local farmers and sickening indigenous populations. Chevron has also done plenty of polluting right here in the U.S.: In 1998, Richmond, California sued Chevron for illegally bypassing waste water treatments and contaminating local water supplies, ditto in New Hampshire in 2003. Chevron was responsible for the death of several Nigerians who protested the company's polluting, exploiting presence in the Nigerian Delta.

 

DeBeers

Diamonds are a girl's best friend -- unless she lives in the Ivory Coast.  "Blood" or "conflict" diamonds are the name given to minerals purchased from insurgencies in war-torn countries.  Prior to 2000 when the U.N. finally took a stand against the practice, DeBeers was knowingly funding violent guerrilla movements in Angola, Sierra Nevada, and the Congo with its diamond purchases. In Botswana, DeBeers has been blamed for the "clearing" of land to be mined for diamonds -- including the forcible removal of indigenous peoples who had lived there for thousands of years. The government allegedly cut off the tribe's water supplies, threatened, tortured and even hanged resisters.

 

 

Haliburton

Any corporation that has Dick Cheney as a CEO has got to be evil. Haliburton, a huge "oilfield services" company, profited big time from the U.S.'s invasion of Iraq when Cheney called in his boys to quell burning oil wells -- and to "help" the Iraq oil ministry pump and distribute oil. Haliburton has also been implicated in countless oil spills, including the BP disaster of 2010.    

 

Pfizer

Big Pharma gets rich when you get sick. Pfizer, the largest pharmaceutical corporation in the U.S., pleaded guilty in 2009 to the largest health care fraud in U.S. history, receiving the largest criminal penalty ever for illegally marketing four of its drugs. It was Pfizer's fourth such case. As if Pfizer's massive use of animal experimentation wasn't heart wrenching enough, Pfizer decided to use Nigerian children as guinea pigs. In 1996, Pfizer traveled to Kano, Nigeria to try out an experimental antibiotic on third-world diseases such as measles, cholera, and bacterial meningitis. They gave trovafloxacin to approximately 200 children. Dozens of them died in the experiment, while many others developed mental and physical deformities. According to the EPA, Pfizer can also proudly claim to be among the top ten companies in America causing the most air pollution. 

 

ExxonMobil

Another oil company that makes the list, ExxonMobil is perhaps best known for the 1989 Exxon Valdez oil spill which resulted in 11 million gallons of oil contaminating Prince William Sound. But they have also been responsible for a huge oil spill in Brooklyn and for aiding in the decline of Russia's critically endangered grey whale because of drilling in its habitat. The Political Economy Research Institute ranks ExxonMobil sixth among corporations emitting airborne pollutants in the United States. ExxonMobil counters not by cleaning up its act, but by funding scientific studies  which refute global warming. ExxonMobil was targeted by human rights activists in 2001 when a lawsuit alleged that ExxonMobil hired Indonesian military who raped, tortured and murdered while serving as security at their plant in Aceh. 

 

Monsanto

Big Agra makes the list with Monsanto, pushers of genetically modified foods, bovine growth hormones, and poison. Monsanto's list of evils includes creating the "terminator" seed which creates plants which never fruit or flower so that farmers must purchase them anew yearly, lobbying to have "hormone-free" labels removed from the labels of milk and infant milk replacer (through bovine growth hormone is believed to be a cancer-accelerator) as well as a wide range of environmental and human health violations associated with use of Monsanto's poisons -- most notably "Agent Orange." Between 1965 and 1972, Monsanto illegally dumped thousands of tons of highly toxic waste in UK landfills. According to the Environment Agency the chemicals were polluting groundwater and air 30 years after they were dumped.  Alabama sued Monsanto for 40 years of dumping mercury and PCB into local creeks. Plus, Monsanto is infamous for sticking it to the very farmers it claims to be helping, such as when it sued and jailed a farmer for saving seed from one season's crop to plant the next. 

 

Dyncorp

This privatized military company is often hired by the U.S. government to protect American interests overseas -- and so the government can claim no responsibility for Dyncorp's actions.  Dyncorp is best known for its brutality in impoverished countries, for trafficking in child sex slaves, for slaughtering civilians in Iraq and Afghanistan, and for training rebels in Haiti. Among some stiff competition, mercenary Dyncorp may be the deadliest and most evil corporation in the United States.

Read the Full List HERE