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Posts Tagged ‘president’

Obama Lied To The People To Get Elected

July 22nd, 2014

peggy-joseph-300x257Mac Slavo: Remember Peggy Joseph?

She’s the woman who swooned over Barack Obama’s every word and was so excited about the fact that all her problems would be solved once he became President that she broke down in tears. Read more…

Economy, Financials, Government, Healthcare, Politics

Mexican Drug Cartels Fire At US Border Control

July 22nd, 2014

50-cal-300x209Mac Slavo: The border is completely safe. So say President Barack Obama, Representative Nancy Pelosi, Senator Harry Reid and others who support the wave of illegal immigrants entering the United States.

A new report from the southern border, however, suggests otherwise. Read more…

Defense, Government

Obama Is Trying To Get Rid Of Your Guns

July 22nd, 2014

putin-ak47-2Mac Slavo: A new round of sanctions by the United States targets Russia’s financial, energy and defense sectors.

The Executive Order signed on Wednesday by President Barack Obama is being called  ”evil” by Prime Minister Dmitry Medvedev and bans, among other things, the sale of all Russian-made AK-47 Read more…

Defense, Government, World News

Strobe Talbott Says Russia Shot Down The Malaysia Airlines Plane

July 17th, 2014

boeing300X600 Paul Joseph Watson: Brookings Institution President Strobe Talbott has sensationally blamed Russia for shooting down a Malaysia Airlines plane which was hit by a Read more…

Airlines, Defense, Government, World News

The Crunch: “It’s Going to Happen In The Next Administration; Regardless Of Who Wins This Election”

August 31st, 2012

Mac Slavo: Our incumbent President says that things are getting better, jobs are being created, and America is on the road to recovery. His opponent, Governor Mitt Romney, says the opposite, but claims he has a plan that will turn things Read more…

Economy, Financials, Government

Barack Obama: 24 Statistics That Show How Much The Current President Has Messed Up Our Economy

August 22nd, 2012

Michael Snyder: Under Barack Obama, the U.S. economy has performed worse than it did under any other president since the end of the Great Depression.  After every other recession since World War II, the U.S. economy always regained what was lost and got even stronger Read more…

Economy, Government

40 Reasons That Show Barack Obama And Mitt Romney Are Essentially The Same Candidate

August 20th, 2012

Michael Snyder: What a depressing choice the American people are being presented with this year.  We are at a point in our history where we desperately need a change of direction Read more…

Economy, Government

SmartStops.net Teams With TradeKing to Facilitate Risk Management

July 11th, 2012

San Francisco, California, July 11, 2012– SmartStops.net, an online service that helps investors of all levels manage investment risk, announced today that the SmartStops BrokerLink service is now available for clients of online broker Read more…

ETF, Mutual Fund, OPTIONS, Uncategorized

Collapse: It’s Coming! Are You Ready? (Part One of Two)

June 14th, 2011

Everything is not all right. And things are going to get worse … much worse. The economy is on the threshold of calamity. Wars are spreading like wildfires. The world is on a razor’s edge.

Not so, say world leaders and mainstream media experts. Yes, there are problems, but the financiers and politicians are aware of them. Policies are already in place and measures are being taken to correct them.

Whether it’s failing economies, intractable old wars or raging new wars, the word from the top always maintains that steady progress is being made and comforts the populace with assurances that the brightest minds and the sharpest generals are in charge and on the case. On all fronts, success is certain and victory is at hand. Only “patience” is required … along with more men, more time and more money.

As far as these “leaders” and their media are concerned, the only opinions that count come from a stable of thoroughbred experts, official sources and political favorites. Only they have the credentials to speak with authority and provide trustworthy forecasts. That they are consistently, if not invariably, wrong apparently does nothing to diminish their credibility.

How can any thinking adult possibly imagine that the same central bankers, financiers and politicians responsible for creating the economic crisis are capable of resolving it? Within days of its announcement, we predicted that Bush’s TARP (Troubled Asset Relief Program) was destined to fail, and subsequently predicted the same for Obama’s stimulus package (The American Recovery and Reinvestment Act). They were no more than cover-ups; there would be no recovery.

Meet the New Plan, Same as the Old Plan

Democrat or Republican, it makes no difference. Despite the heated rhetoric, solving economic problems had less to do with the party in power and more to do with professional competence. Both sides had their turn in office. Both used their power to initiate policies that created the problems. Both sides had their shot at fixing the messes they were responsible for. Both sides failed, as we predicted. Given who they are and what they’ve done, we confidently predict an unbroken sequence of bipartisan failures in the future.

The Beltway Incompetents are in the driver’s seat. What person with a healthy instinct for self-preservation would believe the promises of politicians or trust the judgment of central bankers or Wall Street financiers whose only real interest is self interest?

Not “Business as Usual”

In the 1920s, US President Calvin Coolidge declared, “The business of America is business.” Four score and 10 years later, the business of America has become war: The forty-year War on Drugs; The ten-year War on Terror; the Afghan War (longest in American history); the eight-years-and-no-end-in-sight Iraq War; the covert wars in Pakistan and Yemen; and most recently, the “time-limited, scope-limited kinetic military action” in Libya.

While the justifications for engaging in these wars were all different, all were murderous, immoral, interminable, ruinously expensive and abject failures. Why would anyone believe the optimistic battle communiqués issued by the “czars” in charge and the battlefield brass who keep reassuring the public that reapplying previously failed strategies would, this time, lead to success?

Yet even in the face of their proven failures and gross incompetence, anyone daring to challenge the party line or the conventional wisdom is dismissed as an “alarmist,” “fear monger,” or “gloom-and-doomer.” However unwelcome our forecasts may be – pessimism, optimism, like or dislike are all irrelevant – only their accuracy counts. We correctly forecast:

  • Afghan and Iraq Wars would be debacles
  • Bursting of the housing bubble
  • The “Gold Bull Run”
  • The “Panic of ’08″
  • European Monetary Union crisis
  • Failure of US bailout/stimulus packages to revive housing and create jobs
  • Falling governments, spreading civil wars and social upheaval on a global scale

We also said that the Federal Reserve’s sighting of economic “green shoots” in March 2009 was a “mirage” and predicted that their much vaunted “recovery” was no more than a temporary solution, a quick-fix to be followed by “The Greatest Depression.” And now, in June 2011, with the Dow on a down trend and the economic data increasingly pointing in the direction of Depression, Washington and Wall Street remain in denial. The only debate among the “experts” is whether or not a “double dip” recession is likely.

However, for the man on the street – pummeled by falling wages, higher prices, intractable unemployment, rising taxes and punitive “austerity measures” – “Depression,” not “recession,” and certainly not “prosperity,” is just around the corner.

To be continued in Part Two.

Regards,

Gerald Celente
for The Daily Reckoning

[Editor's Note: The above Trend Alert is available as part of a subscription to The Trends Journal, which is published by Gerald Celente. The Trends Journal distills the ongoing research of The Trends Research Institute into a concise, readily accessible form. Click here to learn more about and subscribe to The Trends Journal.]

Collapse: It’s Coming! Are You Ready? (Part One of Two) originally appeared in the Daily Reckoning. The Daily Reckoning provides over half a million subscribers with literary economic perspective, global market analysis, and contrarian investment ideas.

Read more here:
Collapse: It’s Coming! Are You Ready? (Part One of Two)




The Daily Reckoning is a contrarian e-letter, brought to you by New York Times best-selling authors Bill Bonner and Addison Wiggin since 1999. The DR looks at the economic world-at-large and offers its major players – investors, politicians, economists and the average consumer – some much-needed constructive criticism.

Uncategorized

Gold Soaring In Comparison To Stocks

June 10th, 2011

A seminal speech was delivered a few weeks ago by President Obama at the State Department, in it he outlined a radical switch of policy in the Middle East.  Such an error in judgement was made once before when Jimmy Carter suggested that we democratize Iran.  What occurred was  destruction of an ally in the Shah and replacing him with a purported force for democratization in the persons of the Ayatollah and the Mullahs.

Just look at what we got stuck with.  Our present course in the Middle East may be a repetition of this error.   There is no guarantee that what may be thought to be democratic for Westerners, may be counterproductive in a completely different arena.

Far from there being an Arab Renaissance, we may be witnessing the formation of a Islamist Spring, followed by an Arab Winter.  Hope may rise eternal that American style democracy can emerge from a fundamentalist, theocratic mindset.  This may be a thin blanket for a cold night.  Anti American and Israeli sentiments may not be far from the surface of what is though of as a movement toward Jeffersonian Style Democracy.   Suffice it to say, The U.S. may be imposing Western beliefs on Middle Eastern customs and traditions established for over a thousand years.

Such developments may well constitute exactly the opposite of what our strategists are planning.  Black swan anyone?  Turbulence, instability and uncertainty have usually been a prescription for precious metals and natural resources as a safe haven.

From where is all the money coming to pay for all these planned excursions?  Can an already troubled financial system handle additional burdens that threaten to break the camel’s back?

We read about debt limit, budgetary woes, foreclosures, unemployment, Eurozone debt crisis, the possible loss of a AAA credit rating and a myriad of domestic travails.  Shouldn’t we first repair our own home first?  Sound money and a sound fiscal body is vital for our national health.

Interestingly, the precious metals and mining indices are moving higher, while the equity markets are declining showing relative strength breakouts.  The Dow-Gold Ratio has shown a major breakdown through the 8 to 1 ratio.  We are seeing an eerily similar setup to the Great Depression and the 1970’s where paper money such as equities are seen as less valuable than hard assets.  Investors are seeking protection in precious metals due to this dollar devaluation and disappointing economic recovery.  Despite bailouts, record low interest rates and quantitative easing the Dow-Gold ratio shows that the economic recovery has been ineffective and inflationary.

Gold and Silver are showing signs of fortitude during these equity sell offs maintaing its status as an authentic safe haven .  A significant continuation in trend may be beginning where precious metals may move higher while equities continue to correct as investor look to hold real money over paper.  This breakdown in the Dow Gold Ratio signifies major inflation and economic weakness ahead.

The S&P is showing negative divergences between price and momentum an indication of further price decline.  The absence of relief rallies over five weeks in equities and the outperformance of gold indicates investors are interested to hold hard assets going into the conclusion of QE2.  All eyes are on the financial markets as QE2 expires.  Investors are exiting the dollar as well as equities and moving into hard assets.  The market may be signaling future accommodative measures especially if the equity market continues declining.

I invite you to follow my favorite sectors (precious metals, uranium and rare earths) with me on a daily basis with my technical intelligence reports and intra day chart videos by clicking here.

Read more here:
Gold Soaring In Comparison To Stocks

Commodities

Gold Soaring In Comparison To Stocks

June 10th, 2011

A seminal speech was delivered a few weeks ago by President Obama at the State Department, in it he outlined a radical switch of policy in the Middle East.  Such an error in judgement was made once before when Jimmy Carter suggested that we democratize Iran.  What occurred was  destruction of an ally in the Shah and replacing him with a purported force for democratization in the persons of the Ayatollah and the Mullahs.

Just look at what we got stuck with.  Our present course in the Middle East may be a repetition of this error.   There is no guarantee that what may be thought to be democratic for Westerners, may be counterproductive in a completely different arena.

Far from there being an Arab Renaissance, we may be witnessing the formation of a Islamist Spring, followed by an Arab Winter.  Hope may rise eternal that American style democracy can emerge from a fundamentalist, theocratic mindset.  This may be a thin blanket for a cold night.  Anti American and Israeli sentiments may not be far from the surface of what is though of as a movement toward Jeffersonian Style Democracy.   Suffice it to say, The U.S. may be imposing Western beliefs on Middle Eastern customs and traditions established for over a thousand years.

Such developments may well constitute exactly the opposite of what our strategists are planning.  Black swan anyone?  Turbulence, instability and uncertainty have usually been a prescription for precious metals and natural resources as a safe haven.

From where is all the money coming to pay for all these planned excursions?  Can an already troubled financial system handle additional burdens that threaten to break the camel’s back?

We read about debt limit, budgetary woes, foreclosures, unemployment, Eurozone debt crisis, the possible loss of a AAA credit rating and a myriad of domestic travails.  Shouldn’t we first repair our own home first?  Sound money and a sound fiscal body is vital for our national health.

Interestingly, the precious metals and mining indices are moving higher, while the equity markets are declining showing relative strength breakouts.  The Dow-Gold Ratio has shown a major breakdown through the 8 to 1 ratio.  We are seeing an eerily similar setup to the Great Depression and the 1970’s where paper money such as equities are seen as less valuable than hard assets.  Investors are seeking protection in precious metals due to this dollar devaluation and disappointing economic recovery.  Despite bailouts, record low interest rates and quantitative easing the Dow-Gold ratio shows that the economic recovery has been ineffective and inflationary.

Gold and Silver are showing signs of fortitude during these equity sell offs maintaing its status as an authentic safe haven .  A significant continuation in trend may be beginning where precious metals may move higher while equities continue to correct as investor look to hold real money over paper.  This breakdown in the Dow Gold Ratio signifies major inflation and economic weakness ahead.

The S&P is showing negative divergences between price and momentum an indication of further price decline.  The absence of relief rallies over five weeks in equities and the outperformance of gold indicates investors are interested to hold hard assets going into the conclusion of QE2.  All eyes are on the financial markets as QE2 expires.  Investors are exiting the dollar as well as equities and moving into hard assets.  The market may be signaling future accommodative measures especially if the equity market continues declining.

I invite you to follow my favorite sectors (precious metals, uranium and rare earths) with me on a daily basis with my technical intelligence reports and intra day chart videos by clicking here.

Read more here:
Gold Soaring In Comparison To Stocks

Commodities

Steroids Wearing Off! Key Sectors Slumping! Urgent Action Required!

June 10th, 2011

Mike LarsonI’ve been a huge football fan for years. I started watching Dallas Cowboys games when I was five because I loved the star on the team’s helmets. I cheered for the Miami Dolphins because I live in South Florida. And then after I went to college in Boston, I adopted the New England Patriots as my team — an affiliation that carries to this day.

One thing I’ve always hated to see was when the game would be corrupted by steroids. I remember when Lyle Alzado of the Los Angeles Raiders struck fear into the hearts of opposing teams in the early 1980s. But it turned out his aggressive style of play and incredible strength turned out to stem largely from drug use. He died a broken man of brain cancer at 43.

It’s not just football, either. How many baseball greats are now turning out to be nothing more than juiced-up pretenders? Heck, even cycling great Lance Armstrong is under a cloud today due to doping allegations made by former teammates.

It’s truly sad, and in the end, what’s the point? Why try to get an unfair edge if it just ends up killing you in the end? Or if your medals and rings and trophies just get stripped away?

Why am I bringing this up?

Because we’re seeing the same, sorry thing happen here to the U.S. economy! Washington has been trying to pump the economy full of easy money for the better part of two years now. Yet it hasn’t worked! And despite all that, the addicts on Wall Street are once again jonesing for another hit!

What’s going to happen in the markets as a result? What does this mean for you? And most importantly, what can you DO about it? Here’s my take …

Why You Can’t Keep Propping
up an Ailing “Player” Forever

Beginning in March 2009 and continuing all the way through present day, Washington has been trying to juice the economy. It began with the bogus “stress tests.” They helped spike the value of bank and real estate stocks, allowing companies to sell equity and buy themselves some time.

We were told the trillions in stimulus programs would cure our economic woes.
We were told the trillions in stimulus programs would cure our economic woes.

It continued with the $1.25 trillion QE1 program … the $600 billion QE2 boondoggle … payroll tax cuts … the HAMP mortgage modification effort … an almost-$900 billion economic stimulus bill … and more.

We were told these would drive unemployment down substantially.

We were told these would prevent a double-dip in housing.

We were told these efforts would — for once and for all — plug the massive balance sheet holes in the banking system.

We were told there would be virtually no negative side effects.

And we were told months ago that the economy had entered a self-sustaining, healthy recovery.

But Treasury Secretary Timothy Geithner … Federal Reserve Chairman Ben Bernanke … President Obama’s economic advisors … and virtually all the major Wall Street economists got it wrong. All we did was pump the economy up with monetary steroids — buying us some short-term performance at the cost of long-term health.

We’re now $14.3 trillion in debt, and Geithner is raiding every government account he can to keep us under the debt ceiling. Plus, we’re running up a trillion-dollar deficit for the third straight year, something no country in the history of the world has ever done.

And what do we have to show for it?

  • A confirmed double-dip in housing,
  • A rising cost of living,
  • A renewed jobs market threat, with unemployed Americans taking a record-long amount of time to find work,
  • And a fresh roll over in bank stocks, with companies like Bank of America giving up every penny of gains they’ve made in the last two years.
Advertisement

Wall Street’s Plea: “Brother, Can
You Spare Some More QE?”

Bottom line: The print, borrow, spend program is NOT working! Yet in the wake of the dismal May jobs report, Wall Street is back to begging Helicopter Ben Bernanke for more free money! And when they don’t get it, like some spoiled kid, they take their toys and go home.

On Tuesday, the Fed chairman offered no hint that QE3 would be forthcoming.
On Tuesday, the Fed chairman offered no hint that QE3 would be forthcoming.

Just witness what happened late Tuesday …

Bernanke gave a speech on the economic outlook at the International Monetary Conference in Atlanta. He said the economy appeared to be weakening again, but failed to promise QE3. Result? Stocks rolled over into the close.

Meanwhile, the same economic “experts” like Paul Krugman who told us that if we just borrowed, printed and spent enough money, everything would be fine, are still at it. They’re asking for even more of the same medicine that didn’t work in the past … twice!

Look folks, the plain, unvarnished truth is that our economy needs a long period of convalescence to heal. We need to work off the massive excesses built up during the tech stock and real estate bubbles. All the steroids in the world won’t do the trick!

Fortunately, you CAN take steps to protect yourself. You can avoid losing money if stocks and the economy sink. In fact, you can turn lemons into lemonade and rack up profits from fading sectors like real estate, banking, consumer durables, and more.

That’s what I’m already helping my subscribers do — and if you’d like to join them for just $2.73 per day, click here to learn more.

Your other option?

Sit by and do nothing while Washington and Wall Street sink further into the debt, deficit, and downturn abyss. I trust that sounds as unattractive an option to you as it does to me.

Until next time,

Mike

Read more here:
Steroids Wearing Off! Key Sectors Slumping! Urgent Action Required!

Commodities, ETF, Mutual Fund, Real Estate, Uncategorized

The War on Digital Currency

June 9th, 2011

A joke for you, Fellow Reckoner: How many Senators does it take to change a light bulb? Oh, wait, we’ve got a better one: How many Senators does it take to dismantle a cryptographically secured, completely decentralized, Peer-to-Peer (P2P) network of voluntary, free market traders exchanging goods and services across six continents using tens, perhaps hundreds, of thousands of individual computers and some of the most advanced cyber technology and software coding known to date?

Answer: we don’t know…but Senators Charles Schumer (D, New York) and Joe Manchin (D, West Virginia), seemingly immune to common ignominy, have taken on the challenge anyway.

Your editor has no idea of the cybercryptography aptitude of the two senators but, as with most endeavors undertaken by politicians in the name of “your own damned good,” practical experience and a sufficient understanding of the issue at hand are rarely prerequisites for intervention, again, “on your (unsolicited) behalf.”

The two erstwhile wonks took to the presses this week, demanding something be done about one particular free-market affront to authority.

We are referring, of course, to the latest furor surrounding bitcoin, a P2P cyber currency setting the virtual – and, some would argue, actual – world ablaze. (We first brought you the story a couple of weeks ago, when bitcoins were trading for roughly B$1 = US$7.5. As of this morning, they’ve shot up to B$1 = US$31.5. See “An Emerging Free Market Currency” and “How Governments Distort the Value of Money” for a “bit” of background about them and about the pitfalls of government-backed currencies in general.)

Long story short, bitcoin is a limited supply, decentralized digital currency; a free market alternative to state issued notes and coins. As such, it poses a direct – though entirely non-violent – threat to the state’s monopoly on counterfeiting. This, cry the powers that be, must not be tolerated. Of course, before any politico can act, they must first have a distraction, a fall boy, a pretense, a reason for rescuing us from the horror that is our own decision-making capacity. We picked it in that first column, the relevant portion of which is reprised here:

Another cause for concern among bitcoin skeptics is that, as the economy of the free market currency expands it will inevitably begin posing a threat to the state’s own money-printing racket. It will, thereby, raise the ire of bankers and politicians who will have every incentive to make the currency illegal in order that they may protect their own monopoly and continue cheating their citizens of the value of their president-stamped notes and coins. Given the state’s nature when it comes to these matters (and here we refer readers to the recent and despicable case against Bernard von NotHaus) there is every reason to expect that it will indeed crack down…and hard.

Here we expect all the usual arguments from all the usual suspects: “Bitcoin transactions are anonymous and therefore provide cover for peddlers of child pornography and drug traffickers,” they will contend.

But the astute reader knows in his gut there is something very wrong with this line of thinking right from the beginning. Cash is anonymous too. People by things deemed illegal by the state with state-issued currency all the time. So what? Does this mean US dollars should be banned? Some people drive their cars recklessly, with little or no regard for their own safety or for others’. Should we ban cars?

The question, however, is not whether the Feds should do something (moral considerations have rarely, if ever, stopped them before), but whether they could do something, even if they wanted to…

Now that we have a little background, let’s get back to those busybody senators. As one might imagine, a virtually untraceable currency – such as bitocin or…umm…CASH! – might find use as a medium of exchange to purchase both white and black market products like, say, drugs. Such was the case with Silk Road, a website where users (literally) can buy illegal substances with bitcoin.

Said Senator Chuck of Silk Road and bitcoin in a news conference on Sunday:

“Literally, it allows buyers and users to sell illegal drugs online, including heroin, cocaine, and meth, and users do sell by hiding their identities through a program that makes them virtually untraceable.” Apparently, the senator wants Silk Road shut down immediately with bitcoin, no doubt, soon to follow. The pair have written to Attorney General Eric Holder and the DEA asking that action be taken to crackdown on Silk Road.

Now that the pair have their straw man, we can be sure it will be used as a pretense to attack free-market currencies themselves. Stay tuned as the story unfolds on that front…

For now, we wonder what users of bitcoin are to do now that the self-appointed invigilators of free market activity are on their case? Well, for the past few weeks at least, they’ve been rejoicing. The currency has almost quadrupled in value since the Silk Road issue came to the fore.

Bitcoin enthusiasts may wish, therefore, to thank Senators Schumer and Manchin for, without their commitment to proffering illogical, largely ignorant remarks in the nation’s mainstream press, bitcoin might have taken a while longer to reach the critical mass on which it must now surely be verging. “Bravo, Senators,” we can almost here the cyber underground chorus, “Thanks for the free publicity!”

Joel Bowman
for The Daily Reckoning

The War on Digital Currency originally appeared in the Daily Reckoning. The Daily Reckoning provides over half a million subscribers with literary economic perspective, global market analysis, and contrarian investment ideas.

Read more here:
The War on Digital Currency




The Daily Reckoning is a contrarian e-letter, brought to you by New York Times best-selling authors Bill Bonner and Addison Wiggin since 1999. The DR looks at the economic world-at-large and offers its major players – investors, politicians, economists and the average consumer – some much-needed constructive criticism.

Uncategorized

US Trade Deficit Takes on a Life of its Own

June 9th, 2011

The week of “non-data” here in the US continued on Wednesday, with the markets searching for a clue as to which direction to go, and the only news they had to work with was from Greece, which didn’t bode well for the currencies, yesterday.

But the lack-o-data ends today, with the Weekly Initial Jobless Claims, and… The April US trade deficit… This trade deficit has taken on a life of its own, in that we had a recession (I call an ongoing depression) and a financial meltdown, which one would think would bring this trade deficit in line… But NOOOOOOO! That’s not happening, folks, and why? Ahhh grasshopper, this has been discussed so many times in the past, but the point here is that the manufacturing in this country has gone the way of the Pony Express… Sure, it still exists, and in some countries would be great! But for a country our size, it has wasted away in Margaritaville! And it’s not enough to offset the imports…

But then, if consumers weren’t given stimulus checks in the mail, and other forms of steal-like measures to get us to spend, then imports wouldn’t be so huge… But then because we import so much oil, one would think we would be foreign oil independent by now…

So… The currency and metals traders will get some direction today, and maybe take their collective minds off of Greece… We might also get a sniff of what the European Central Bank (ECB) is thinking, as they’re meeting as I type this morning. Remember on Monday, I told you that we would be looking for the use of the word “vigilance” and mention of the need to provide “price stability” from ECB President, Trichet. So… Any mention of those two things, and I would think the euro (EUR) gets a good push higher versus the dollar today. You see, by mentioning those two things, Trichet, cracks open Pandora’s Box of rate hikes… Now, I’ve gone on record as saying that I thought the ECB would hike rates again in July… If the statement following the meeting today goes the way I believe it will go, then you can almost “book ’em Danno” for that rate hike in July…

Speaking of central banks… The Reserve Bank of New Zealand (RBNZ) met last night, and left rates unchanged. (Remember, that back in March, the RBNZ cut rates to accommodate the economy after the earthquake.) The RBNZ was quite upbeat in their statement following the meeting… You know, when New Zealand suffered that earthquake, I said then that I thought the Kiwi people would bounce back quickly… And the RBNZ admitted last night that they underestimated the speed and momentum that the rebuilding has taken on… That’s key, folks… Because those words would lead me, or a trader to believe that it won’t be long until the RBNZ is back at the rate hike table… (I’m betting that free undercoat that it comes in the fourth quarter of this year.) The New Zealand dollar/kiwi (NZD), took the statement and ran! Kiwi has outperformed all currencies overnight!

Of course, RBNZ Governor Bollard, who I’m no fan of, had to take his usual shot at kiwi strength, saying that it was ahead of itself… Hmmm… But then he did say that he would not be intervening, as intervention cannot move a trend… WOW! Love to hear a central banker say those words! Are you listening, Japan? How about you, Brazil? Or Switzerland? And over in the US with all your back-door intervention to keep the dollar weak?

OK… Did you see the results of the OPEC meeting? Well, if you haven’t, just me telling you that the price of oil is up about $2 this morning would tell you it didn’t go well, right? Yes, our friends (NOT!) over at OPEC now have problems… I mean these guys all cheated with production levels before, but now you’ve got a real problem in the fact that not all these guys like each other. In fact some countries are joining the rebels to defeat another country, and now they must all sit down together and make policy? I laugh, because that just cracks me up! That’s not going to happen now, and it won’t happen probably ever again… That’s right, OPEC could be on the way out… And so… Oil is up $2 this morning…to $101.

Down in Brazil, the country continues to fight inflation, and at the same time, stem the currency’s gains… I don’t see that working out too well for them! Yesterday, the Brazilian Central Bank raised their internal rate 25 basis points (1/4%), which surprised the markets. You see the markets had fallen into the trap of thinking that since the government wanted to stem the currency’s gains, that they wouldn’t hike rates further for that would attract investors and push the real (BRL) higher… Gotcha! It’s one of those things like the entertainer that puts one hand out to signal to the audience to stop the applause, but the other hand is signaling for them to continue the applause…

The Brazilian government sees inflation rising and reacts with rate hikes… Inflation by the way rose to just above 6.5% in April, which is the ceiling target for the central bank. So… Once again, the need to fight inflation was greater than the government’s desire to have the real weaker… Which I might add is stupid… If they want to fight inflation, allow their currency to gain!

Well… Gold and silver continue to get sold this week… I don’t get it, but momma said there would be days like this, my momma said… Cheaper levels to buy, is the only thing I can think of… The demand for the metals remains strong… Did you hear that the US mint in San Francisco was told to take the dust covers off their presses? Yes, for quite a few decades now, all the minting of silver coins has been done in Annapolis, (I believe), but with demand for Silver Eagle Coins so high, it looks like another mint will begin to push out coins again…

So… With all this demand, why isn’t silver at $50 again? And gold heading toward $2,000? If you really want to do something about it, contact Bart Chilton at the CFTC, and ask him… Maybe he can shed some light on this…

The Aussie dollar (AUD) saw some selling after a weaker-than-expected jobs report, last night. The unemployment rate remained at 4.9%, but the job creation was lackluster, especially for a county that had been knocking the ball out of the park, when it came to job creation… Looks like a cheaper level to buy, this morning…

And the Polish Central Bank raised rates 25 basis points (1/4%) in a surprise move yesterday… The Polish zloty performed nicely after the rate announcement… I know that I don’t talk about the “Euro Wanna-Be’s” very often, so I thought I would mention that there was a rate hike in Poland yesterday! The “Euro Wanna-Be’s” is a named that I coined for the countries that were thought to be on the “fast track” to joining the euro (back in 2003!): Poland, Hungary, and the Czech Republic…

OK… Most of you know that I have long called for Treasuries to be the next asset bubble… Of course, that was long before the Fed Reserve bought about $2.7 trillion worth of Treasuries in their two rounds of quantitative easing (QE)! But, I still think that we’ll see this happen in the long run… You know, Bill Gross, manager of the world’s largest bond fund (PIMCO) also is not a fan of US Treasuries, and has made investments accordingly… Right now, he and I look like we have egg on our respective faces, because the 10-year Treasury yield has fallen to 2.94%… But, historically speaking, history shows that Gross’s calls often seem wrong before proving accurate.

“I certainly don’t have any regrets,” Gross said.

As far as myself… I feel as though I let people down that shorted Treasuries with TBT… But, like I said the other day… I normally see things long before they happen, and in the meantime people think I’m nuts for having said what I saw… So… Patience…

Now… Before I head to the Big Finish, I have to get this off my chest… OK… I want to first say that I in no way was referring or instigating anyone to shoot Ben Bernanke yesterday when I said that no one in Atlanta had gone “John Wilkes Booth” on him during his speech… Believe or not, I actually had someone accuse me of instigating a shooting of Big Ben… Geez Louise! You know… If you want me to be bland like most newsletter writers, and not have fun with people, their statements, and policies, then… No wait! I can’t change! I guess you’ll just have to leave us…

I even had a guy tell me he was unsubscribing because of that statement… I told him, fine! I guess now you’ll have to find some other place to learn about all these things for free!

Then there was this… According to a Washington Post poll… Barely half of the people surveyed support raising the debt ceiling… WOW! Do you think that people are finally getting a clue? The problem here is that a substantial number of the respondents think the US will be seriously harmed if Congress doesn’t increase the debt limit… So, just like the many times before (and there have been 80 times before that the debt limit has been raised since 1920), nobody wants to do it, but it has to be done to keep us from going into default…

OK… I don’t know where to start with this… No wait! I do know where to start! Start at the spending… Reduce the spending and you won’t need to add to the debt or raise the debt limit! Spend, spend, spend, is what we’re all about and have been for a while…

Shoot Rudy… Once again yesterday someone accused me of being political in the letter… Apparently, a newcomer to the letter… For had they been around for a while they would recall me banging on the previous administration for their deficit spending too! I am adamant about this, folks… If I banged on the previous president for his $450 billion budget deficits, I don’t see how I can let this current president skate free with is $1.5 trillion budget deficits! So… Get your facts straight before you play that politics card with me!

To recap… The week of no-data ends today, and the markets can get some direction from the US trade deficit, and weekly jobs data. They can also see the color of the ECB’s thoughts, when ECB President Trichet speaks after leaving their rates unchanged this morning. The New Zealand dollar was the best performer overnight, after the RBNZ left the door open to re-enter the rate hike room (probably in the fourth quarter). Brazil did hike 1/4%, and gold and silver continue to weaken, even with strong demand…

Chuck Butler
for The Daily Reckoning

US Trade Deficit Takes on a Life of its Own originally appeared in the Daily Reckoning. The Daily Reckoning provides over half a million subscribers with literary economic perspective, global market analysis, and contrarian investment ideas.

Read more here:
US Trade Deficit Takes on a Life of its Own




The Daily Reckoning is a contrarian e-letter, brought to you by New York Times best-selling authors Bill Bonner and Addison Wiggin since 1999. The DR looks at the economic world-at-large and offers its major players – investors, politicians, economists and the average consumer – some much-needed constructive criticism.

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When Gas Prices Lead to Cutbacks

June 8th, 2011

Stocks fell again yesterday, down another 20 points or so. That’s six for six sessions in the red. And they’re down again, if only modestly, this morning. Gold is down too, off 8 bucks and change over the past 24 hours. But oil…oil is up big after, as one of the papers announced, “OPEC talks broke down in acrimony on Wednesday after Saudi Arabia failed to convince the cartel to lift production, sparking a rebound in global oil prices.” A “larger than forecast” drop in US inventories also helped push the price higher.

So let’s see… That’s a flat line for oil output, less in the reserve tank, increased global demand and more and more freshly-inked bills chasing the stuff. Seems only natural the price would eventually resume its skyward trajectory.

As you would expect, all these factors are colluding to hit American motorists rather hard this driving season. According to a new Harris Poll, 51% of Americans say they’ve cut back on other products and/or services in order to cope with higher prices at the pump. We probably didn’t need a poll to tell us that higher prices mean tougher decisions, of course, but it is interesting to see where the family budget is taking the biggest knock.

According to the poll, as cited in a riveting issue of Tire Review, “28% have cut back on dining out while 24% have cut back on groceries, 18% say they have cut back on entertainment, 11% have reduced driving, and 10% have cut back on clothing purchases.”

Of course, if you’re cruising to the local Dean & Deluca in your pimped-out Maybach, you’re probably not too worried about burning a few hundred extra dollars per week or per month on fuel. But if, as is the case for millions of workaday Americans, you’re struggling to keep/find work and living on a restricted budget, every dollar counts.

“Those with lower household income are more impacted,” the article continues, “with 65% of those with a household income of less than $35,000 a year having cut back on products or services because of higher gas prices compared to 38% of those who have household income of $100,000 or more.”

We wonder what this means for the government’s growing fleet of limousines that Eric brought to our attention yesterday. Here’s the chart again, in case you missed it the first time around:

The Number of Limousines Owned by the Federal Government

And we wonder, too, what effect this will have on “The Recovery.” Our guess is it will have no effect on it…because there was never a recovery to begin with. It was a sham…a prestidigitation…and hoax, wrapped in a con, wrapped in a scheme. Of course, you wouldn’t know that if you got your information from Whitehouse.gov. An article that appeared almost exactly a year ago (June 17, 2010) on that site reads (try not to laugh and/or cry):

“With tens of thousands of projects funded and millions of Americans on the job today, it’s hard to believe that it’s only been 16 months since President Obama signed the American Recovery and Reinvestment Act. And with so many jobs saved and created already, you might think that the Recovery Act’s greatest impact is behind us. But it’s not.”

Well, at least they were right about the last part: the “American Recovery and Reinvestment Act,” will probably do much more damage before it’s replaced by some other, equally moronic plan by the Feds to “do something.”

Joel Bowman
for The Daily Reckoning

When Gas Prices Lead to Cutbacks originally appeared in the Daily Reckoning. The Daily Reckoning provides over half a million subscribers with literary economic perspective, global market analysis, and contrarian investment ideas.

Read more here:
When Gas Prices Lead to Cutbacks




The Daily Reckoning is a contrarian e-letter, brought to you by New York Times best-selling authors Bill Bonner and Addison Wiggin since 1999. The DR looks at the economic world-at-large and offers its major players – investors, politicians, economists and the average consumer – some much-needed constructive criticism.

Uncategorized

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