Monday, March 22, 2010

Spending Money To Save Money

The currency markets continued their consternation today over the future of Greece, her debts, and the supposed effect it will have on the Euro community. This of course again weighed on the Precious Metals as "uncertainty' once again drove the lemmings into the safe-have we laugh at, the US Dollar.

The Dollar once again found stiff resistance to any move higher just above 81 on the US Dollar Index. The Dollar began a slow fade around 9AM est. and sits near it's low of the day here mid afternoon. I can only chuckle at the madness.

The Precious Metals got whacked right on schedule as the CRIMEX opened at 8:20AM est this morning. Gold QUICKLY fell from 1105 to 1092 in about 30 minutes wherein the Dollar topped out, rolled over, and Gold began a bounce that lasted until 30 minutes before the CRIMEX close, topping at 1102 around 1PM est.

Gold bounced at support near 1090 as many have suggested it would. It remains to be seen how much follow thru we can expect in light of this weeks $144 BILLION in Treasury Auctions. Every effort will be made to persuade investors that US Debt is a much safer investment than Gold.

Today's Dollar bid and hit on Gold both appear ridiculous considering the US Congress had managed to throw another $1 TRILLION log onto the all consuming debt inferno overnight with the passage of the historically flawed Health Care Bill. Only in American can a politician convince doubters that he is saving money and cutting the federal budget deficit while spending money. Money he doesn't even have mind you.

Bored by the deceit on the CRIMEX I turned to review the other crime being committed in Washington. The passage of Obamacare. Talk about crimes of the century... Change nobody believes in.

Governments never give us anything; they simply take. Small governments take a small amount and large governments take…everything.
-Larry LaBorde, Silver Trading Company

It was more than amusing last evening listening to the Democrats tout their health care bill. More than one misguided advocate compared their health care bill to the passing of Medicare in 1966 and Social Security in 1935. I suppose if you look at these "social programs" as the unfunded liabilities that they are, then yes the Democrats health care bill is comparatively another burden of debt on an already overburdened society of unfunded debt. In many respects, the Democratic health care bill has simply pushed America one step closer to a hyperinflationary depression.

Healthcare Bill to Cause U.S. Hyperinflation By 2015
The National Inflation Association today issued a warning to all Americans of a potential outbreak of hyperinflation in the U.S. by year 2015 caused primarily by the healthcare bill and rising interest payments on our national debt.

Medicare was created in 1966 at a cost of $3 billion per year and the House Ways and Means Committee estimated in 1966 that in 1990 the cost of Medicare would reach $12 billion per year. Instead, the actual cost of Medicare in 1990 was $107 billion (792% more than what was projected) and today Medicare costs $408 billion annually. In 2003, the White House Office of Management and Budget estimated that the Iraq War would have a total cost of $50 to $60 billion. So far, we have already spent $713 billion on the Iraq War (over 1,000% more than what was projected).

The Congressional Budget Office is estimating that the health care bill will cost $940 billion over the next 10 years, but if history is any indication, the actual cost will likely be several trillion dollars. NIA believes the health care bill will be the final nail in the coffin of the U.S. economy and will just about guarantee that we will see hyperinflation by the year 2015.

The U.S. government last week reported a record monthly budget deficit for February 2010 of $220.9 billion. Total tax receipts for the month were only $107.5 billion compared to outlays of $328.4 billion. The total U.S. deficit for the first five months of fiscal year 2010 was $651.6 billion, with tax receipts of $800.5 billion and outlays of $1.45 trillion. The deficit was up 10.5% for the first five months of fiscal year 2010 over the same period in fiscal year 2009.

We are now at a point where if the U.S. government taxed Americans 100% of their income, the tax receipts generated would not be enough to balance the budget. Likewise, if the U.S. government cut 100% of its spending including defense, but kept paying Social Security, Medicare and Medicaid, we would still have a budget deficit. NIA believes it will be impossible for the U.S. to have a balanced budget ever again.

Medicare, the crutch every Democrat leans on to support their Health care Bill, has proven over the life of it's existence to be horrifically more costly than the politicians who created it lead us to believe. Will Obamacare be any different?

House sends health care overhaul bill to Obama
On the cusp of succeeding where numerous past congresses and administrations have failed, jubilant House Democrats voted 219-212 late Sunday to send legislation to Obama that would extend coverage to 32 million uninsured Americans, reduce deficits and ban insurance company practices such as denying coverage to people with pre-existing medical conditions.

"This is what change looks like," Obama said later in televised remarks that stirred memories of his 2008 campaign promise of "change we can believe in."

"We proved that this government -- a government of the people and by the people -- still works for the people."

"We will be joining those who established Social Security, Medicare and now, tonight, health care for all Americans," said Pelosi, D-Calif., partner to Obama and Senate Majority Leader Harry Reid in the grueling campaign to pass the legislation.

"This is the civil rights act of the 21st century," added Rep. Jim Clyburn of South Carolina, the top-ranking black member of the House.

GOP lawmakers attacked the legislation as everything from a government takeover to the beginning of totalitarianism, and none voted in favor. "Hell no!" Minority Leader John Boehner, R-Ohio, shouted in a fiery speech opposing the legislation. "We have failed to listen to America and we have failed to reflect the will of our constituents."

The nonpartisan Congressional Budget Office said the legislation awaiting the president's approval would cut deficits by an estimated $138 billion over a decade. For the first time, most Americans would be required to purchase insurance, and face penalties if they refused. Much of the money in the bill would be devoted to subsidies to help families at incomes of up to $88,000 a year pay their premiums.

O puh-leeeeze! Stop the parade of lies and twisted facts right here. Obamacare is in no way, shape, or form a 21st century civil rights act. Shout that dowm immediately. If the Democrats want to hang their hats on the same rack as Medicare and Social Security, let them. The two combined represent the bulk of the debt burden the nation faces today. Obamacare is sure to be the rock that tips the scales towards default on that debt.

If this is what change looks like, then somebody please poke my eyes out.

"We proved that this government -- a government of the people and by the people -- still works for the people."

Uh, yeah right... By hook and by crook, backroom handshakes, and public bribes this "legislation" was passed into law completely against the wishes of a majority of Americans. If America still had a "government of the people and by the people" this bill would have never been brought to a vote, let alone passed into law. This isn't leadership. This is the dawn of facism in America.

The single most amusing, and abused, claim of the Democrats voting for this bill was their mantra that Obamacare will "cut the deficit by $138 BILLION over the next ten years." Well BFD [big f***ing deal]! $138 Billion Dollars is a pittance when looked at in the context of America's national debt. At over $12.5 TRILLION and growing today, that $138 Billion represents ONLY 1% of the total deficit today. Considering that the deficit is projected to rise to $14 TRILLION by October of this year, it is a completely insignificant claim. To put their $138 billion Dollar savings into context, the Treasury will auction off $144 TRILLION Dollars of new debt JUST THIS WEEK! Nancy pelosi is completly full of....

Inside the Pelosi Sausage Factory
Last week Republican Rep. Mike Pence posted on his Facebook site that famous Schoolhouse Rock video titled "How a Bill Becomes a Law." It's clearly time for a remake.

Never before has the average American been treated to such a live-action view of the sordid politics necessary to push a deeply flawed bill to completion. It was dirty deals, open threats, broken promises and disregard for democracy that pulled ObamaCare to this point, and yesterday the same machinations pushed it across the finish line.

Perhaps the most remarkable Democratic accomplishment this week was to make the process of passing ObamaCare as politically toxic as the bill itself.

President Obama was elected by millions of Americans attracted to his promise to change Washington politics. These were voters furious with earmarks, insider deals and a lack of transparency. They were the many Americans who, even before this week, held Congress in historic low esteem. They'll remember this spectacle come November

America will never be destroyed from the outside. If we falter and lose our freedoms, it will be because we destroyed ourselves.
– Abraham Lincoln

Got Gold Report - Letter to CFTC on Position Limits for Gold, Silver
By: Gene Arensberg
Dear Chairman Gensler and Commissioners,

Certainly you all would agree with this statement: “No futures trader should be able to dominate the market or be able to achieve such an overwhelming size of positioning on one side of the market that it would intimidate the majority of traders in that market.” Such a statement should be foremost in the policy totem pole of futures market regulators. However, the fact is that just such an egregious situation currently exists today in the U.S. precious metals futures markets, up to now apparently with the Commission’s blessing.

The American people want to know why this Commission tolerates obvious and unfair market dominance by just a few well-connected, well-informed, well-funded and politically clever entities. Further, the American people look to you to end this inequity as one goal of this historic meeting.

Market dominance by a privileged few traders can only be accomplished if those few traders are granted a trading advantage, either by the rules themselves or by the regulator’s granting of exemptions to the rules. Truly fair and free markets cannot exist so long as one or just a few traders are allowed trading dominance.


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