Denial Won't Make It Go Away

Gold revs its engine and squeals down the track
SAN FRANCISCO (MarketWatch) -- The U.S. Federal Reserve gave gold the fuel it needed to restart its engine and the precious metal has already driven through the trading range barrier it's been stuck in for the past month.

Gold futures had been trapped in a $50 trading range between $860 and $910 an ounce on the New York Mercantile Exchange since May 28. It climbed past $920 in electronic trading Thursday evening as the U.S. dollar slumped in reaction to the Fed's failure to signal urgency to raise rates to curb inflation.

On Wednesday, the Fed decided to hold short-term interest rates steady at 2%, but sharpened its focus on inflation, saying that the risks posed to the economy by upward pressure on prices have increased. See full story.

"Gold broke decisively out of the trading range that had constrained it as investors came to realize that the Federal Reserve won't be able to begin a rate-hike campaign until 2009," said Brien Lundin, editor of Gold Newsletter.

"People are finally coming out of the fog and realizing that we're in a world of hurt and people are plain scared," said Dale Doelling, chief market technician at Trends In Commodities.

"Stocks are in the toilet, the dollar is getting hammered, oil is going through the roof, food commodities are in the stratosphere [so] there's only one solution," he said. "Buy gold! Buy silver! Buy them because they're the only defense against what's happening in all the other markets."
http://www.marketwatch.com/news/story/gold-revs-its-engine-squeals/story.aspx?guid=%7B859C0FA3%2DEB68%2D4DC8%2DA361%2D0629E1A6F5D7%7D


Intervention Will Not Stop the Dollar’s Slide
By: Peter Schiff, Euro Pacific Capital, Inc.
This week the Federal Reserve took a step closer to acknowledging reality. Unfortunately it didn’t let that admission move it from a policy course firmly guided by fantasy. In its policy statement, Bernanke & Co. took the important step in noting that inflation expectations had taken hold in the country at large. However, in asserting that it expects inflation to moderate this year and next, the Fed gave no indications that these heightened expectations are gaining traction within the Open market Committee itself. As a result, it signaled no likelihood that it was actually prepared to do something to fight a problem which it doesn’t really believe exists in the first place.

In fact, by indicating that they expect inflation to moderate, the Fed is saying that elevated expectations are unwarranted. In other words, Bernanke claims that despite the fact that so many people are carrying umbrellas, he still believes it will be a sunny day. The takeaway from the statement is that no rate hike is forthcoming. The markets saw this position for what it is….capitulation to inflation and a weakening dollar. No surprise then that the gold responded with the biggest single day gain in more than 20 years!
http://news.goldseek.com/EuroCapital/1214585926.php


Stocks Tumble Toward Bear Market On Rising Economic Concerns
U.S. stocks slumped last week, pushing the Dow Jones industrial average to the brink of a bear market on mounting concern that write-downs and record oil prices will keep eroding profit and economic growth.

"The market is dealing with anxiety about further losses and also coming to grips that we're in a significantly slower period of economic growth," said Kevin Cronin, head of investments at Putnam Investments. "People thought the worst was behind us."
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/28/AR2008062800262.html


Barclays warns of a financial storm as Federal Reserve's credibility crumbles
Barclays Capital has advised clients to batten down the hatches for a worldwide financial storm, warning that the US Federal Reserve has allowed the inflation genie out of the bottle and let its credibility fall "below zero".

"We're in a nasty environment," said Tim Bond, the bank's chief equity strategist. "There is an inflation shock underway. This is going to be very negative for financial assets. We are going into tortoise mood and are retreating into our shell. Investors will do well if they can preserve their wealth."

The bank said the full damage from the global banking crisis would take another year to unfold.
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/27/cnbarclays127.xml


Here today, one word has gotten The US Federal Reserve, general equity investors, The White House, and anybody foolish enough to waste their time watching CNBC to the edge of this systemic financial meltdown. Choosing to hide behind this one small word will cost millions BILLIONS. Life as they know it, is about to vanish for those unfortunate enough to be associated with this word:

DENIAL

For over six months now there has been denial that the US is in a recession. Arguing over the "definition" of what constitutes a recession does not make them go away, or any less severe. For the past 6 years there has been denial that the US Stock markets have been in a "bear market". Even today, the Washington Post clings to the idea that the DOW INDEX is still not in a bear market:

"The Dow retreated 4.2 percent, to 11,346.51, and needs to fall another 0.1 percent to complete a bear-market decline of 20 percent from its October record."

I like the word "pathetic" here. Friday the DOW crashed through an eight year support zone at 11,750. The Dow began it's "bear market" in the Spring of 2000 with the bursting of the Dot-com Bubble". It was only through the levitation tricks of the PPT that the Dow was able to give the illusion that there was no bear market the past six years. Adjusted for inflation, the DOW has been trapped in a horrific bear market slide that has slowly sucked the "wealth" out of all those in "denial".

Every hack on Wall Street has known for years that inflation was "out of control", but the government rigged the numbers to say otherwise, and gave investors cover for their denial. "The credit crisis is over", or so the financial media led investors to denial. 80,000 jobs were created this month, or so the government statistics led investors to denial. One percent GDP is still growth, despite the 4% inflation that makes it negative growth secreted by...more denial. "This time it's different"...more denial.

It would have been so much easier if people had respected this small word: TRUTH. Live in denial and pay the consequences. Respect the truth and live free. Gold and Silver are all that is left of the Truth now, and all that is left to protect you from the ravages of Denial.

On Thursday, Gold broke higher and out of it's three month consolidation with a move of $32 to the upside. The largest single day move in Gold since 1985. This speaks volumes of Truth, as Gold now sets it's sights on "infinity and beyond".

"On Friday, gold confirmed its breakout, which means there will be little holding it back - just like there is now very little that's holding the Dow up."
- Alex Wallenwein


Dow Stock Market Crash and Iran War Herald End of US Dollar Hegemony
Wars are rarely fought over national security issues, as political leaders often claim. At rock bottom, they are mostly fought over economic issues.

Iraq and Iran (if Congress and the administration get their way) are the only two countries the US has ever attacked preemptively. They are also the only two oil-producing countries that ever went off the petrodollar. The alleged nuclear ambitions of a terrorist-sponsoring country cannot be the real reason for the planned attack – because terrorist-sponsor North Korea was not only allowed to develop nuclear weapons unmolested, it was even allowed to test-launch a potentially nuclear-tipped ICBM at the US without any military repercussions whatsoever.

There goes the "national security" rationalization for this planned attack.

This fact exposes the attacks for what they really are. tools of US monetary policy. The dollar has no real value internationally, save for the fact that the now militarily enforced necessity for countries to buy dollars in order to buy oil creates artificial demand.

The euro's existence threatens all of this, now. Oil countries have a dollar-alternative in the euro, and so does the rest of the world. The euro is designed to not be quite as inflationary as the dollar is and has been. This is done by virtue of the ECB's exclusive mandate of "price stability", another word for inflation fighting.
http://marketoracle.co.uk/Article5254.html


Bob Chapman, The International Forecaster

Let's see now. The stock market gains for the past two years or so have just been vaporized. Over the past two years, would you have made more money based on the advice you have received in the IF, to buy gold, silver and their related stocks, or would have made more listening to the inane, jackass pundits of the fane-stream financial media and their tips about the "bargains" that are out there? Let's take a trip down memory lane to find out.

The last time the Dow was at 11,346.51 or lower was on September 7, 2006, when it closed at 11,331.44, which happens to also be almost exactly the precise figure for a 20% loss and the official start of a bear market. So let's use that date for our comparison, and see what the returns look like for the 22 months or so between September 7, 2006 and June 27, 2008.

On September 7, 2006, the Dow closed at 11,331.44 as just stated, the S&P closed at 1294.02 and the Nasdaq closed at 2,155.29. Also on September 7, 2006, spot gold closed at $618.30, spot silver closed at $12.58, the XAU was at 144.95, the HUI was at 347.92.

On Friday, June 27, 2008, the Dow closed at 11,346.51 as stated above, the S&P closed at 1,278.38 and the Nasdaq closed at 2,315.63. Also on Friday, spot gold closed at $928.10, spot silver closed at $17.59, the XAU closed at 194.49 and the HUI closed at 451.06.

First, let's see how the jackasses (not to be confused with Democrats who are Jackasses with a capital "J") in the inane, fane-stream media did. The Dow essentially gets a big goose egg. The S&P posted a loss of 1.2%. And the Nasdaq had a "whopping" gain of 6.9%, or about 3.5% annualized, way behind actual inflation and still short of official inflation.

Now let's see how our subscribers have done. Spot gold is up an impressive 50.1%, which annualized is about 25%, way past inflation with enviable profits to spare. Spot silver is up a very healthy 39.8%, which annualized is about 20%, again way past inflation with goodly profits to spare. The XAU is up 34.2% and still exceeds inflation when annualized with room to spare, as does the HUI, which is up 29.6%.

Now for the kicker. The dismal results posted for the general stock markets occurred despite the full support of the PPT which saved them from collapse numerous times. The incredible results posted for gold, silver and their related shares came despite massive cartel suppression, which has been mercilessly applied to the metals and their shares in the most underhanded and illegal of fashions. If this is what happens when the Goldilocks Matrix created by the cartel is still floating around in the vapid minds of the sheople, just try to imagine and wrap your mind around what will happen when reality finally sets in. We can't wait to find out!!!

http://news.goldseek.com/InternationalForecaster/1214764950.php


PLEASE NOTE: I will be away from the markets Monday through Wednesday visiting with family. Please contact Steven R. Thornbury at MONEX Deposit Company for more on the TRUTH about Gold and Silver in my absence: 1-800-949-4653 ext. 2162