Providing yet more commentary on the budget deal and background on our national debt, BrotherJohnF explains the numbers behind this fiasco and shows why the US government is already bankrupt. If it weren’t for the phony numbers being expressed by government agencies, it would be too obvious. (See US Debt Clock here.)
What is it about a comedian that gives him that uncanny ability to put the shocking and sad truths right in front of our eyes, and yet make us laugh at them? First up is Jon Stewart showing how the main-stream media has wavered on its reporting stance of JP Morgan’s takeover of Bear Stearns in 2008 and its recent $13 billion settlement with the Justice Department over ‘alleged’ financial misdeeds.
And then there’s the slightly more serious delivery of the reality of our socioeconomic conditions in the western world by Russell Brand in this BBC interview by Jeremy Paxman.
While the comedian usually does a good job of showing us the issues, their ideas on how to solve society’s problems can be questionable. Peter Schiff takes up the opposition to Brand’s socialist remedy in the following video.
Conspiracy theories are only theories until they become conspiracy facts. The straws are blowing in the wind as this main-stream CNBC panel discusses the reasoning behind Germany’s gold repatriation. The Bundesbank (Central Bank of Germany) recently stated they have plans to move their gold held at other central banks back to the Father Land. This includes moving 374 tonnes from France’s Banque de France & 300 tonnes from the New York Federal Reserve Bank. Could it be that, as Pimco’s Bill Gross opined, that the central banks of the west are starting to lose faith in one another?
The ‘bad idea’ to attempt to resolve the national debt problem by minting a trillion-dollar platinum coin. Supporters say the US Treasury would be able to deposit said coin with the Federal Reserve to act as an asset, backing part of the outstanding debt.
As Jim notes, this is not an honest approach to discussing the root problem – which is based in the monetary system, itself.
Besides that, the idea is preposterous and just shows how crazy this system has become. Things don’t hold value because someone says they have value. A thing has value based on the public/market demand for that thing.
Prior to 1971, government spending was constrained by both interest rates and the fact that there was some semblance of a gold-backed currency via Bretton Woods. But today, we have neither constraint – the Fed’s zero percent interest rate policy combined with the current, purely fiat monetary system has created the unstoppable spending spree that has led us to these extreme levels of debt. If there is anything left at all as a bar against further spending, it is the debt ceiling. But even that is now being threatened with a proposal to remove it entirely.
The just announced appointment of Jacob Lew as Treasury Secretary. Jim is holding judgement in order to see if there will be any honest discussion regarding the real problems of the monetary system.
All this talk in Washington about going after the rich to pay more taxes is just a smoke screen. As Rick Santelli explains in the clip below, the arguments between the Democrats and Republicans are using numbers that ignore inflation & mislead the public on who they’re actually targeting with tax increases.
To say that the tax increases will only affect those making $250K/year is really talking about those making $165K/year (in 1993 dollars), which is a 35% miss when it comes to being honest about the actual situation our economy is facing.
Or worse, when they talk about only taxing the millionaires and yet begin their arguments with finding ways to tax those making $250K/year, that’s a 75% miss.
The main point is that by ignoring the inflation, these government leaders are purposely hiding their ever-increasing extortion of wealth from the middle class, not from the rich!
From the main-stream media: CNBC’s Rick Santelli reports from the floor of the Chicago Mercantile Exchange and expounds on our government leaders’ misguided pursuits to establish an unlimited (and unregulated) debt policy. (Not that the ceiling debate will make any difference in the long run – because to fix the debt problem, spending cuts that cost politicians their careers would need to be undertaken. But with a ceiling in place, at least there’s some semblance of recognition that there’s a real problem with the national debt and its unstoppable growth.)
The illusion of choice continues to be exposed, although one wonders if the public is either too hypnotized or too apathetic to recognize what’s really happening. Jimmy Rogers had earlier inferred on CNBC that neither Obama nor Romney understood enough about economics to make appropriate comments on policy.
Ron Paul then notes that the established banking powers, i.e. the Fed, will be equally served by either the Republican or the Democrat… “they both know how to play the game and they represent a one-party system.” This system depends on the Fed to keep printing money for bail-outs and government spending. [Under such a system, isn’t it obvious that the real power does not reside in the White House?] Furthermore, Paul states, “I’ve been in this business for a long time and believe me, there is essentially no difference from one administration to another, no matter what the platform.”
The US is coming up fast on the so-called Fiscal Cliff, but neither of the two political parties’ candidates are openly discussing the potential economic calamity or any remedies to overcome any resultant disaster. On this CNBC interview, Lloyd Blankfein, CEO of Goldman Sachs, Alan Simpson & Erskine Bowles of the Deficit Commission discuss the reasons why so many major corporations are holding their cash at this uncertain juncture.
CNBC’s European Squawk Box had an interesting interview session with author and economist, Richard Duncan. Looking back over the last 40 prosperous years, ever since the last remaining link between the US dollar and gold was removed, the world has evolved into a form of financial creditism. Duncan notes that the central banks of the world have been able to provide easy credit and the world has greatly benefited. However, there comes a point where borrowers are unable to take on more debt. If the government does not step in and provide QE or some other kind of spending programs, there will be another Great Depression. Duncan even goes on to say that, in fact, a depression is unavoidable and inevitable, but it can be delayed if the government decides to benefit society further by spending on 21st century technologies in the nano science and medical fields, for example.
Another interesting part of this segment that should be noted is where the panel brings up the comparison of the present situation with the past, where central banking policy was to raise interest rates rather abruptly in order to curb reckless borrowing. “When you throw money into the system ….. the good guys out there won’t borrow and spend because they’re too cautious. It’s the bad guys who come in and borrow and spend. … There’s lots of bad guys around, we can see them all over the place – we know they’re there!” Touché.
Here’s Chris Powell of GATA explaining the motivation for central banks to keep the gold price under control. Powell also notes that potential gold investors should only buy physical gold, which they can actually hold in their hands. He estimates that 70-80% of all the gold people think they own doesn’t really exist! The paper forms of ‘investment gold’ such as ETFs or unallocated accounts likely do not have the physical gold supporting all the paper claims. Through rehypothecation schemes, gold leasing and swaps arrangements, there is simply not enough physical metal to back all the paper claims.
Eric Sprott is interviewed on CNBC and gives some new perspectives on gold and silver investing for main-stream viewers. He mentions how the central banks of the world do not like to see the price of gold go higher because that would be a sign of the true weakness in their fiat money as they continually print more to fight the contagion in their economies. He also expects silver to out-perform gold and gives some interesting statistics for his reasoning.
Which presidential candidate would you be most be confident would NOT lie to you? Here’s Ron Paul on CNBC taking up the philosophical arguments no other candidates are discussing, including one hell of a debate on gold and the debasement of the dollar with Morgan Stanley’s Stephen Roach.
Television ads promoting precious metals as safe havens against profligate government spending have been denied by main-stream networks. Swiss America created two such commercials to be aired on TV only to be denied by NBC, MSNBC, CNBC, ABC, CBS, CNN/HLN and the Discovery Channel. The networks claim the commercials violate certain standards they try to uphold.
Google TV, however, will be airing the ads. Score another win for the Internet!!!! See the full story as well as the other ad at Swiss America.
Many people are suspicious and doubt that the SPDR GLD ETF actually has all the physical gold it says it has. Here’s a CNBC video, where Bob Pisani was one of the few people in the world who was able to visit HSBC’s vault somewhere in London and was able to see all those beautiful stacks of gold bars.
This may have eased some suspicions, but some are still concerned. Some people suspect that the GLD ETF may not have sole ownership ties to these bars of gold due to central bank gold leasing programs in addition to the fact that there isn’t enough physical gold in the world to back the volume of daily paper trades in the gold futures and options markets.
Update September 9, 2011
Wow, talk about trashing a concept – here’s a video that lays out all the weaknesses in the GLD prospectus. As you watch the video and learn about the prospectus, keep in mind the three main players behind the SPDR GLD Shares: