GREENWICH, Conn. – The Dow Jones and Standard & Poor’s 500 indexes reached record highs on Thursday, having completely erased the losses since the stock market’s last peak, in 2007. But instead of cheering, we should be very afraid.
Over the last 13 years, the stock market has twice crashed and touched off a recession: American households lost $5 trillion in the 2000 dot-com bust and more than $7 trillion in the 2007 housing crash. Sooner or later — within a few years, I predict — this latest Wall Street bubble, inflated by an egregious flood of phony money from the Federal Reserve rather than real economic gains, will explode, too.
SANTA FE, N.M. (AP) — For more than a decade, he packed and repacked his treasure chest, sprinkling in gold dust and adding hundreds of rare gold coins and gold nuggets. Pre-Columbian animal figures went in, along with prehistoric “mirrors” of hammered gold, ancient Chinese faces carved from jade and antique jewelry with rubies and emeralds.
Forrest Fenn was creating a bounty, and the art and antiquities dealer says his goal was to make sure it was “valuable enough to entice searchers and desirable enough visibly to strike awe.”
Occasionally, he would test that premise, pulling out the chest and asking his friends to open the lid.
Trends forecaster Gerald Celente says, “The United States is provoking North Korea. They keep putting more and more sanctions on them. It’s economic warfare.” Celente is worried that “economic warfare” will turn into a shooting war. Celente warns, “This is just another losing war that’s going to end up with weapons of mass destruction annihilating millions if this madness is not stopped.” On the topic of the Cyprus banking crisis, Celente says it’s coming to the U.S. and points out he predicted this a year and a half ago. Celente says, “Tax on deposits? Can any adult say stealing your money?” What about the recent lackluster performance of gold and silver? Can it still protect you? Celente says, “Suppose you can’t get your money out of the banks. Suppose they just screwed you. You need food or fuel. You’d like a couple of pieces of gold or silver in your hand. You think that would buy you anything?” On the subject of Homeland Security stockpiling hollow point ammunition, Celente says, “That we are even having this discussion shows how fascist things have become. How much of history has to be repeated before we see it is repeating itself, again?” Join Greg Hunter as he goes One-on-One with Gerald Celente, Publisher of the Trends Journal.
Almost certainly prices for goods in Cyprus will rise as a result of its banking crisis, because the imposition of capital controls will restrict imports, leading to supply bottlenecks. In addition residents will no longer be complacent about keeping money on deposit, but seek other alternatives. Large depositors may be trapped, but smaller local depositors will draw them down for cash to stock up on things needed tomorrow while they are available.
Cypriots will therefore change their preferences from money in the bank in favour of goods. And the lessons from Cyprus are not being lost on ordinary folk across the eurozone, so bank depositors elsewhere are likely to alter their preferences away from bank deposits as well, depending on how they view the soundness of their own banks.
Rest easy, Canadians, for your bank accounts are going to be made as safe as those bank accounts in Cyprus. Just take a look at the Canadian government’s budget plan for 2013, particularly pages 144 and 145 of Economic Action Plan 2013. There the Canadian government promises to use Canadian deposits to save “systematicaly important” banks (emphasis ours).
The Government proposes to implement a “bail-in” regime for systemically important banks.This regime will be designed to ensure that, in the unlikely event that a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital. This will reduce risks for taxpayers. The Government will consult stakeholders on how best to implement a bail-in regime in Canada. Implementation timelines will allow for a smooth transition for affected institutions, investors and other market participants.
Those bank liabilities that will be allowed to be converted into regulatory capital? Those include customer accounts. Apparently bailing “out” banks with tax money is too 2012. Now bail “ins” with customer money are all the rage. When a bank deemed “systematically important” finds itself in trouble, taxpayers won’t be on the hook to provide the funds to rescue the bank from its bad decisions. Instead the bank will get to look inward, toward its own customers and the funds in their accounts. The Cypriot model is catching on.
When we discuss gold stocks we often refer to gold and silver stocks. Today we take a look at the silver stocks specifically.
Below is a chart of our partially weighted producers index which contains 14 of the largest silver producers. We didn’t cherry pick the 14. We went down the list and that includes a handful of companies which have really struggled in recent years. Anyway, the 56% in the current cyclical bear is well in line with history. Previous downturns have been 51% and 49% and then 85% from 2007-2008.
Just last week Yiannakis Omirou, Cypriot House of Representatives President, was calling for the nation to accept it is “time for responsibility” as they progressed towards a final solution; and yet today, as Cyprus’ Famagusta reports, he believes the ‘Troika-imposed’ responsibility will, “turn Cyprus into a colony of the worst possible type.” His ‘Icelandic’ solution is to “leave the Troika and EMS behind,” to ensure “national independence, national sovereignty, moral integrity, and economic independence.” He may have a point; judging from the chart below of the Troika’s poster-child Greece, relative to Iceland, things are not going so well. As Omirou ominously concludes, “if we remain bound by the Troika and the memorandum Cyprus’ destiny is already foretold and there will be no future.”
James Corbett of corbettreport.com and Broc West of apperspective.net are pleased to bring you the latest edition of their monthly video series, “The Asia-Pacific Perspective.” In this episode, we cover:
Our April Fool’s wish: someone in the inner circle of power would finally tell the truth.
In an unprecedented abandonment of his carefully scripted responses to Congressional questions, Federal Reserve Chairman Ben Bernanke unleashed what appeared to be a heart-felt and spontaneous disavowal of the financial and political systems of the United States.
Asked a question about the wealth effect, Bernanke paused and said, “The wealth effect. Ah, right.” He then smiled faintly and shook his head. “You want to know about the wealth effect? Well, I’ll be candid with you. This whole thing is a kleptocracy–the financial system, the political system, it’s one big kleptocracy. That’s the real wealth effect.”
Seeming to find his footing, Bernanke continued with a passion that startled the audience. “You know, I told myself to just repeat the party line for another year so I could step down quietly and let Yellen or another of the toadies take over, but I realized that I can no longer stomach the lies, the obfuscation and the plundering.”
Whether or not Italian President Giorgio Napolitano intended to step down or it was just a rumor, following ECB President Mario Draghi phone call, Napolitano denies resignation reports.
Napolitano pledged on Saturday that he would stay in office until the end of his term on May 15 following reports that he planned to step down to break the deadlock created by last month’s election, which left no party able to form a government.
Months of Pressure on Bersani and Silvio Berlusconi
The ECB clearly does not want to take a chance that Beppe Grillio’s Five Star Movement will win the next election, so the pressure is on by the ECB for a different result.