Wednesday, June 9, 2010

Bumbling Ben Guarantees Market Collapse

NEW YORK (AP) -- Oil prices rose to near $75 a barrel Wednesday, after Fed Chairman Ben Bernanke said European debt problems should not have a major impact on the U.S. economy.

NEW YORK (AP) -- The Dow Jones industrials climbed back above 10,000 Wednesday after Federal Reserve Chairman Ben Bernanke said debt problems in Europe might only amount to a "modest" drag on the U.S. economy if the financial markets can halt their slide.

I find it incredulous that people still listen when this silver tongued "wizard" opens his mouth. Have investors and traders not learned there lesson yet. Bumbling Ben Bernanke is full of sh*t. The man has diarrhea of the mouth folks. When Bumbling Ben make assurances, it is time to pack it in, and head for the hills. Has this "academic failure" ever been right about anything?

Take these now infamous Bumbling Ben quotes for instance:

March 28, 2007: “The impact on the broader economy and financial markets of the problems in the subprime markets seems likely to be contained.”

May 17, 2007: “We do not expect significant spillovers from the subprime market to the rest of the economy or to the financial system.”

Feb. 28, 2008, on the potential for bank failures: “Among the largest banks, the capital ratios remain good and I don’t expect any serious problems of that sort among the large, internationally active banks that make up a very substantial part of our banking system.”

June 9, 2008: “The risk that the economy has entered a substantial downturn appears to have diminished over the past month or so.”

July 16, 2008: Fannie Mae and Freddie Mac are “adequately capitalized” and “in no danger of failing.”

A blind man would have a better chance of finding a penny in the street than Ben Bernanke would have of ever being right about anything. Bumbling Ben today told the entire "listening" World that the debt problems in Europe WILL have a major impact on the US Economy. If Ben felt the need to tell the Congress that Europe's debt crisis will not affect the US Economy, you can damn well bet that it will in a calamitous way.

The highlight of Bumbling Ben's testimony today in front of the House Budget Committee was his comment that the economy is getting better, but that jobs and housing are likely to remain weak. How can the economy, which is 70% driven by consumer spending and a strong housing market, be getting better if jobs and housing are "likely to remain weak"? I was laughing so hard at that comment I think I pulled a rib cage muscle.

I straightened up in time to here this choice quote fall from the wizard's diarrhea stained lips:

"We will take the actions necessary to ensure stability and continued economic recovery."

Are those helicopters I hear overhead? What has the Fed done to date to "ensure stability and ...economic recovery"? They have pumped over $2 TRILLION into the banking system!

In the words of Randy Bachman, "You ain't seen nothin' yet." What we have seen the Fed do, behind closed doors I might add...without consent of the Congress, the White House, OR the American print money at an alarming rate and distribute it to their friends, and withhold it from their enemies. The quantitative easing to date, if you will, has only just begun. They're not finished by a long shot.

Ah, the necessary actions of a central bank in the midst of a debt crisis. Print money!

Gold, the TRUTHSAYER, is onto Bumbling Ben's Monopoly game. Now reaching new all-time nominal highs in all the major currencies, Gold has set it's sights on exposing the US Federal Reserve, and their Federal Reserve Notes we call money, as the frauds that they truly are.

After breaking out at 1227 Monday, Gold quickly scampered 2% higher to 1251. 2% is as far as the Gold Cartel will allow Gold to move higher without an effort to take the wind from it's sales. And right on cue, Gold was taken back down from it's recent all-time high today. But, technically, that was a good thing. Gold came down and retested Monday's breakout. This is the kind of action we want to see. We saw it in April and May of this year when gold ran to it's interim peak at 1249, and we are seeing it again here as Gold looks to mover towards the 1300 level and it's next interim peak.

The CRIMEX goons might be able to "slow" Gold ascent, but they are unable to stop it...

In the charts posted here I have attempted to show Gold's potential should Monday's breakout be for real. Gold has now successfully closed above 1227 three days in a row. The CRIMEX goons clearly have their backs against the wall as June delivery demands now account for 75% of their warehouse stocks available for delivery. With this CRIMEX Gold shortage now common knowledge in the Gold pits, it would seem the goons should find it difficult to scare investors and traders out of their long Gold positions here. Some supply might be coaxed from profit takers at higher prices, but it is going to take quite a load of naked sales to meet knew demand if prices continue to rise. This would only further weaken the goons position, and force a very frightening short squeeze of the goons.

On these charts I have attempted to draw three different views of Monday's breakout above 1227, and the projection towards the potential move higher for each. In an odd coincidence, all three projections arrive at the same number of 1287. Should Gold reach 1287, I suspect this is where the goons will begin to put a wall up in front of it. Momentum in a run higher will most likely take Gold to and just through 1300 however. Round numbers almost always encourage a pause, and/or profit taking in a rising market. [The first trip to 1250 in mid-May for example.]

Seasonality charts suggest Gold Tops in late June, and corrects into early July before building a base to assault new highs in the Fall. The volatility in today' currency markets, sovereign debt crisis' lined up like dominoes, and a darkening geopolitical landscape may make seasonality a moot point this year. Only time will tell.

For those still interested in trading Gold, a very good opportunity to profit on the short side may be just up ahead...however tread carefully as the environment Gold has moved into now has the potential to be very explosive to the upside.

As for Silver... Alas the tiny Silver market. Still under the heavy hand of the CRIMEX goons. These criminals are in deep-deep doo-doo. Their desperation is blatantly obvious now. Their actions going forward from here have the potential to destroy the CRIMEX Silver futures market for eternity. Trying to project a market that is so overwhelmingly rigged is foolish. However, recent support in the Gold/Silver Ratio[GSR] has been at 62. Should Gold run to 1287, a move to 62 in the GSR projects a Silver price of 20.75.

Knowing all too well that as soon as I begin to post charts projecting Gold's potential to move higher, the bottom all too often drops out of the market. Therefore we must take a moment to look at levels of support here should the goons maintain "control" of the price: 1224 / 1217 / 1196. Gold's 50 day moving average is now at 1186. Gold's 200 day moving average is now at 1114.

"Government spending - including government jobs - do not really make us richer. They make us poorer. If you could make people better off by hiring them to count each other, why not count them twice? Or three times?"
-Bill Bonner, The Daily Reckoning

The Bad News - Bad News on Jobs
by Brett Arends
The news on jobs isn't as bad as it seemed on Friday.

It's worse.

We already know that when you strip out the short-term Census jobs, May's jobs growth was a pitiful 41,000. But what people haven't realized is that the leading indicators for June are even worse. TrimTabs Investment Research Inc. tracks the real-time jobs picture by monitoring income tax deposits at the Treasury. And these have suddenly started falling. Based on the latest data, the firm predicts the economy will actually lose up to 200,000 jobs, net, in June. "The big news is that we have a job loss of about 200,000 coming in June," says Trim Tabs' Madeline Schnapp, "and the market isn't ready for it."

There Is No Money
By: Gary North
The voters believe that there is no connection to the liability side of citizenship. They believe fervently in the asset side of citizenship. They do not believe that the bills will ever come due for them. They believe fervently that they are entitled to every dime already promised, plus whatever more they can get Congress to enact.

They vote for their beliefs. They vote only for politicians who insist that the liability side of citizenship can be deferred or transferred to others. They vote only for politicians who promise that the asset side of citizenship will increase. Every politician knows this.

Liabilities and assets must match on every balance sheet. The government's balance sheet is the reverse of the citizenry's. Every asset possessed by a citizen is a liability to the government. Every liability must be matched by an asset. What is this asset? Future government income. Where will this come from? From taxes, from borrowing, and from borrowing from the central bank (inflation).

Citizens believe only in the asset side of their balance sheets. The assets – promised future income – must not be offset by liabilities: future taxes, including the inflation tax. The politicians encourage this belief. They vote ever-increasing assets based on future government income, but they refuse to tell voters about the size of these liabilities. They pretend that an off-budget liability is not really a liability. After all, this is what the government's own ledgers show.

The liabilities of the voters – the trust funds full of IOU's from the government on behalf of the citizenry – are counted as assets of the Social Security and Medicare systems. When anyone raises a question regarding the future source of the future funding of these assets – the general fund – he is dismissed as a crackpot, a Tea Party voter.

For voters, the trust funds' IOU's are all assets, not liabilities. For politicians, the same is true. The trust funds' IOUs from the government are assets politically, because the vast majority of voters believe that the trust funds' assets are not legal claims on their future income. The assets are future claims on someone else's future income, not theirs. "Don't tax you. Don't tax me. Tax the guy behind the tree."

Banking System Collapse: Wake Up America Your Banks Are Dying
U.S. banks are being shut down by federal regulators at a staggering pace this year, and yet most Americans seem completely oblivious to it. In fact, federal officials have already shut down 81 U.S. banks this year, which is about double the number that were shut down at this time last year. So why aren't more people upset about this? Well, part of the reason is because the FDIC is doing it very, very quietly. The bank closings for each week are announced every Friday, which means that they pass through the news cycle over the weekend almost unnoticed. For example, banks in Nebraska, Mississippi and Illinois with total deposits of almost $2.3 billion were shut down by federal regulators on Friday. So did you hear about it before now? If not, why not? Shouldn't the fact that we are experiencing a banking system collapse be headline news? But most Americans are more than happy to remain blissfully ignorant of what is going on. In fact, most Americans seem far more interested in what is happening on American Idol or Dancing With The Stars. But when the American Dream starts dying for tens of millions of Americans as the economy collapses perhaps more people will start to care.

So just how bad is the banking system crisis?

What happened to the 'Death of the dollar'?
A video interview of F. William Engdahl

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