Wednesday, March 10, 2010

The US Government is broke, insolvent...impotent.

The CFTC has a lot to answer for come March 25, 2009. The CRIMEX operations on the Gold and Silver markets are so obvious now even Stevie Wonder is complaining to his congressman. Never has a government regulator been more derelict in their duty to uphold the laws of the land than those of the CFTC. I can hear their excuse now, "We don't have the funds to police this market place properly."


Once again, and for no "logical reason", the prices of Gold and Silver where smashed by the CRIMEX's arrogant cabal of government funded banks to prevent the "logical" rise in the price of Precious Metals.

The US Government is amassing debt at an alarming rate. The price of gold should rise as a result as investors question the solvency of the government.

Unemployment rises in 30 states despite the federal governments claims that unemployment has leveled off, and is falling. Gold should rise as investors fear a further lapse in the economy.

Wholesale inventories fall at business threatening the over hyped 4th qtr GDP based on "rising " wholesale inventories. Gold should rise as investors fear a double dip recession.

Chinese exports explode contrary to economist's predictions. Silver should rise as investors sense an increased demand for this vital industrial metal.

Silver inventories on the CRIMEX are threatened by growing physical demand. Silver should rise as investors sense a rising demand for physical Silver bullion, and a growing possibility of a delivery default in the futures market.

Yet the prices of the Precious Metals fall in price.

As we well know, the government will stop at nothing to PREVENT the rise in the price of the Precious Metals. Rising prices in these tiny markets would expose the entire lie that the government seeks to conceal. The US Government is broke, insolvent...impotent.

The dyke has many holes, and the US Government is running out of fingers to fill them fast. Desperation has left them to OBVIOUS intervention and manipulation of the Gold Market. The suppression of the price of Gold is no longer a conspiracy theory, it is an obvious fact.

The entire World can see the CRIMEX operation in the Precious Metal Markets. It's there for all to see between 8:20AM est and 1:30PM est. It's become so obvious you can almost set your watch to it. 8:30AM est, poor US economic data: ATTACK GOLD. 10Am est, London PM fix is in: ATTACK GOLD. 11AM est, London physical market closes: ATTACK GOLD. It sticks out on a price chart of Gold like a sore thumb. Nowhere in a market that trades virtually 24/7 is Gold attacked in this manner but on the CRIMEX.

And worst of all Gold is attacked by US Government sponsored banks selling Gold that DOES NOT EVEN EXIST. It is blatant fraud. But with the blessings of the US Government, it is "business as usual". The government may write the laws, but they clearly feel they are above them because they "control the money".

The CFTC exists to serve the people and protect investors. Yes, the CFTC has a lot to answer to one week from today. The answers are easy. Enforce the commodity laws!

U.S. Monthly Budget Deficit Balloons to a Record
WASHINGTON—Even as government receipts posted a rare increase in February, soaring outlays pushed the country's year-to-date deficit up to a record $651.60 billion.

The government's fiscal 2010 year-to-date deficit is up 10.5% from fiscal year 2009.

The government in February alone ran its largest ever monthly deficit—$221 billion, the U.S. Treasury said in releasing its monthly budget statement Wednesday. The government in February 2009 ran a budget deficit of nearly $194 billion.

"The budget balance has deteriorated sharply over the past 2 years with outlays rising rapidly—mainly due to the government's various stimulus programs--and revenues shrinking—both because of the weak economy and the various tax cuts meant to stimulate the economy," Steven A. Wood, an economist with Insight Economics, wrote in a client note.

February 2010 marks the seventeenth consecutive month in which the U.S. has posted a budget deficit.

Unemployment rises in 30 states in January
WASHINGTON (AP) -- Unemployment rose in 30 states in January, the Labor Department said Wednesday, evidence that jobs remain scarce in most regions of the country.

The data is somewhat better than December, when 43 states reported higher unemployment rates, but worse than November, when rates fell in most states.

Still, five states reported record-high joblessness in January: California, at 12.5 percent; South Carolina, 12.6 percent; Florida, 11.9 percent; North Carolina, 11.1 percent; and Georgia, 10.4 percent.

Michigan's unemployment rate is still the nation's highest, at 14.3 percent, followed by Nevada, with 13 percent and Rhode Island at 12.7 percent. South Carolina and California round out the top five.

There were some signs of job creation. Thirty-one states added jobs in January, up from only 11 in the previous month. But the job gains weren't enough, in many cases, to lower the unemployment rate.

China exports leap 46% in February
Reporting from Beijing - China's exports rose 46% in February from a year earlier, beating expectations and setting the stage for more calls to increase the value of the Chinese currency, analysts say.

The figure, which was announced Wednesday, was underpinned by a bounce back in demand from the United States, the European Union and Japan.

Trade tensions have mounted over China's artificially low currency, the renmenbi. Competing exporters say it gives China an unfair advantage at a time when the rest of the globe is still seeking to recover from the financial crisis.

Chinese policymakers say they cannot consider appreciation until economic conditions are more stable. Chinese Premier Wen Jiabao said Friday the country would keep the value of the renmenbi at an "appropriate and balanced level" this year.

February's increase marks the third consecutive month exports have grown from the same time a year earlier.

"The strong export recovery should provide support for those who advocate for a resumption of RMB appreciation," said Tao Wang, head of China Economic Research for UBS Securities, in a report released Wednesday.,0,3514889.story

A rising Chinese currency will equate to a falling US Dollar. This is a very BULLISH outlook for Gold. Unless of course you work for a US Government funded CRIMEX bank...

Treasury receives record bids for 10-year notes
NEW YORK (MarketWatch) -- The Treasury Department sold $21 billion in 10-year notes /quotes/comstock/31*!ust10y (UST10Y 3.72, +0.02, +0.54%) on Wednesday at a yield of 3.735%.The auction is a reopening, meaning the debt sold will carry the same coupon and maturity date as the original securities issued quarterly. Bidders offered to buy 3.45 times the amount of debt being sold, the highest since at least 1995 and compared to an average of 2.85 at the last for reopenings of 10-year notes. Indirect bidders, a class of investors that includes foreign central banks, bought 35.1%, compared to an average of 41.7% of the last four reopenings. Direct bidders, which include domestic money managers, purchased another 17.5%, versus 8.5%, on average.

Yeah, sure they did...

Foreigners buying slightly fewer Treasurys, Pimco says
NEW YORK (MarketWatch) -- Newly released data on last month's Treasury auctions show allotments to foreign investors shrank compared with previous months, said Tony Crescenzi, portfolio manager at Pacific Investment Management Co.

A snowball rolls downhill slowly at first...

Consumer Confidence Lowest Since March 2009
NEW YORK (Reuters) - U.S. consumer confidence fell in March to its lowest level in a year, as high unemployment and the ways in which the government is using taxpayer money draw mounting apprehension in households, a research group said on Tuesday.

Investor's Business Daily and TechnoMetrica Market Intelligence said their IBD/TIPP Economic Optimism Index slipped to 45.4 in March from February's reading of 46.8.

It was the lowest level the gauge has hit since March 2009. Readings above 50 indicate optimism, while those below 50 point to pessimism.

"Confidence has been hurt by continued job declines and concerns about the economy's lack of vigor," said Terry Jones, associate editor of Investor's Business Daily.

"Despite the spending of trillions of dollars of taxpayer money on stimulus and 'too-big-to-fail' bailouts, the economy doesn't appear to have entered into anything resembling a self-sustaining expansion," Jones said, adding that persistent attempts to pass a "wildly unpopular" health care bill has added to Americans' apprehensions.

Those surveyed still remain uncertain about their household finances in the near term. The gauge's personal financial outlook measure dropped 5.2 percent to 50.7 for March.

How can this be possible? The stock market is UP 60% since March 2009. So much for the government's management of expectations...

Fed Audit Bitterly Opposed By Treasury
The Treasury Department is vigorously opposed to a House-passed measure that would open the Federal Reserve to an audit by the Government Accountability Office (GAO), a senior Treasury official said Monday. Instead, the official said, the Treasury prefers a substitute offered by Rep. Mel Watt (D-N.C.), and would like to see it enacted as part of the Senate bill.

The Watt measure, however, while claiming to increase transparency, actually puts new restrictions on the GAO's ability to perform an audit.

Secretary Tim Geithner, Assistant Treasury Secretary Alan Krueger and Gene Sperling, a counselor to the secretary, held a briefing Monday with new media reporters and financial bloggers during which they discussed the Fed audit and other topics.

Asked whether he supports the House-passed measure to open the Fed to an audit, which was cosponsored by Reps. Alan Grayson (D-Fla.) and Ron Paul (R-Texas), a senior Treasury official said he is intensely opposed to it.

The official said the measure would undermine the independence of monetary policy and could restrict the ability of the Fed to act in times of crisis. He said that the GAO already has audit authority and that the chairman routinely testifies before Congress.

A member of Congress, told of the unnamed Treasury official's comment, asked not to be named and said that Geithner, a former Fed president, should recuse himself from Fed audit legislation discussions, given that the audit would cover his own actions during the crisis.

And Rep. Grayson said he finds Treasury's opposition to the audit troubling. "There is a growing feeling on the part of real Democrats that the president is getting bad advice from people who have sold out to Wall Street," said Grayson. "And opposing a measure that passed overwhelmingly in the House with bipartisan support at the [Financial Services] Committee level, based up on legislation that now has 317 cosponsors in the House, shows that the president may be getting bad advice."

The idea that the Fed's mission would be undermined by an audit, said Grayson, "is a scarecrow erected by people who want to cover up the actions of the Fed for their own purposes, including those who actually have worked at part of the Fed, to prevent accountability at any cost."

Geithner served as president of the New York Fed during the financial crisis.

"It's interesting that the Fed regards the simple fact that people find out what it does as somehow being unduly restrictive. We are a government of laws, not of men," said Grayson.

"It's certainly no surprise that banking insiders at Treasury don't want transparency at the Fed," said Jesse Benton, a spokesman for Rep. Paul. "They are wrapped up in the central bank shenanagins too, and do not want their wheelings and dealings out in the open any more than Alan Greenspan or Ben Bernanke,"

If there's nothing to hide...

Is The Federal Reserve Insolvent?
The ongoing troubles at the GSEs are no secret: it is public knowledge that Fannie had a 5.38% delinquency rate at December, while Freddie just passed the 4% threshold in January; both continue to rise rapidly each month. The fact that the mortgage-bond spread has just hit a record tight is merely an ongoing artifact of the Fed's endless meddling in the mortgage market, with the sole purpose of keeping rates artificially low, and preventing banks from being forced to take massive writedowns on their entire loan book. This is all well known. What, however, seems to have escaped public attention is what the impact of these delinquencies is on the one largest holder of Mortgage Backed Securities, the Federal Reserve. What also seems to have escaped the public is that the Fed is now the world's largest bank, with total assets near $2.3 trillion. We provide a weekly update of the Fed's balance sheet and while we briefly note the liability side, our, and everyone else's, attention, is traditionally focused on the asset side. Yet a more detailed look at the liability side reveals something very troubling, specifically that the Fed's capital, i.e. equity buffer, which as of most recently was $53.3 billion (a comparable metric for plain vanilla banks is their equity buffer, or Tier 1 Capital, or however the FASB wants to define it on any given day when it is covering up massive capital shortfalls) is in fact negligible and could well be substantially negative, if the Fed were to account for the rapidly rising level of delinquencies in its one largest asset holdings: the $1.027 trillion in settled MBS. And while there is no possibility of a run on the Fed, the reality is that the Fed now likely runs with a negative real capital balance, meaning that the US Federal Reserve is now essentially insolvent.

Bottom line:

Gold was hit today to defend the 10-year Treasury auction.

Silver was hit because it is moving up too fast.

In all likelihood, today's hit on the Precious Metals will be reversed, much as it was last night in Asia, again tonight. The Asians love these sale prices we gift to them each day.

Gold bounced at a 38% retracement of the recent leg up off the 1044 low in early February. The present uptrend remains intact. Gold's 50 day moving average is presently 1110.45.

Despite vigorous efforts to slow the rise in Silver as demands for physical bullion increae dramatically, Silver remains above critical price support at 16.92. Silver's 50 day moving average is presently 16.84.

Of special note is the HUI Index resilience today in the face of the CRIMEX attack on the Precious Metals. This represents a vote of confidence in the continued rise in Precious Metals prices despite the fallicious setbacks instigated by the criminal government funded Gold Cabal.

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