Weekday NEWS to Comfort the Disturbed and Disturb the Comfortable.

Thursday 09.30.2010

KHNC Radio station in Colorado CLOSED today;
No new radio show

Economic Collapse Update: Acceleration In Autumn
By Giordano Bruno - Neithercorp Press
Our current economy is a shell game. A grand fraud designed to siphon more and more tangible wealth (not fiat wealth) from the average person and transport it post-haste into the silk lined pockets of a corporate banking minority. The goal? To reduce the self sufficiency of American citizens to the point of total fiscal and social dependence on the top 1% richest men in the world. Conspiracy theory? Not in the slightest. Just a cold hard fact of history. "Feudalism" is, sadly, rampant in the annals of human culture. Anyone who believes that our modern era is somehow different is simply fooling themselves. Elitists seek power over others, they always have and they always will, and, the most efficient way to gain control over the lives of the masses is through engineered imbalances in economy.

Western Civilization Lies Dying
By: John Kozy - MarketOracle.co.uk
The Western commercial system exists to extract more from consumers than it supplies in products and services. Its goal is profit and has never been to improve the human condition but to exploit it. When governments institutionalize this system, they place their nations on suicidal paths, because as Jefferson recognized, "Merchants have no country." It is not terrorism that threatens the security of the Western World, it is the Western World's commercial system.
A man suffering from severe chest pains collapses. His wife calls 911. An ambulance arrives, the EMTs treat the patient, place him in the ambulance's bed, and start off to the hospital. Along the way, the engine stalls. The ambulance's staff begins arguing about how to get the motor restarted. One says more gasoline is needed, another says there's water in the tank, a third says the fuel filter is clogged. While they argue, the patient lies dying.

Forget a Recession, The American Empire is Crumbling
By: Graham Summers - MarketOracle.co.uk
I look around me and I see an Empire in Decline.
The US economy is clearly in a depressionÉ not a recession, not a recovery, but a DEPRESSION. More than 40 million Americans (12%) are on Food stamps. Nearly one in five of us are unemployed of underemployed. Folks go to Wal-Mart at 11PM waiting for their government checks to clear at midnight so they can buy baby formula, milk and other necessities.
Three out of every five Americans are overweight. One in five are obese. Indeed, there are only two areas (one state, Colorado, and Washington DC) where obesity rates are under 20%.
Nearly three in four of us don't get enough sleep. Almost one third of us report having trouble falling asleep EVERY night. And almost half of us report that day-time sleepiness interferes with normal activities including work.

US politicians threaten trade war with China
Congress to vote on punitive tariffs for Chinese imports amid frustration over 'beggar-thy-neighbour' currency policy
Andrew Clark in New York - guardian.co.uk
American frustration with Beijing's trade policy boiled over today into a congressional vote that was expected to back a threat of punitive tariffs on Chinese imports to compensate for perceived manipulation of the level of the yuan.
Exporters and politicians in the US have become increasingly frustrated with the Chinese government's interventionist tendency to keep its currency artificially weak - a practice that means exports of Chinese goods are cheap around the world, while imports of foreign goods are expensive to Chinese consumers.

U.S. Debt Options of Default or Hyperinflation
By: Graham Summers - MarketOracle.co.uk
The big financial myth-buster of the week is that the alleged deleveraging of the US consumer has in fact been a giant myth. According to the Wall Street Journal, if you account for defaults, US consumers have only pared down their debts by an annual rate of 0.8% since mid-2008.
The Journal writes:
Over the two years ending June 2010, the total value of home-mortgage debt and consumer credit outstanding has fallen by about $610 billionÉ Our own analysis of data from the Fed and the Federal Deposit Insurance Corp. suggests that over the two years ending June 2010, banks and other lenders charged off a total of about $588 billion in mortgage and consumer loans.

World According to Gold: Here Comes Tokyo Rose
By: Midas Letter - MarketOracle.co.uk
Now that gold is muscling its way towards $2,000 an ounce, the forces of ignorance embodied by post-secondary-accredited yet nonetheless clueless commentators are being given voice by government sponsored media outlets such as CNN. Tokyo Rose was the generic handle accorded to any of a dozen women who, during World War 2 broadcast programming designed to undermine the morale of American troops over the radio.
Coverage such as stories like today's "The Case Against Gold" on CNN Money are designed to undermine the determination of gold accumulators who are genuinely frightened about the purchasing power of their dollars as their government 'quantitatively eases' the economy back onto its feet. By continuously counterfeiting fiat currencies and flooding the markets with such ersatz lucre, the final rush towards economic collapse is momentarily cushioned.

Gold Forecast Over $1,450/oz as Implications of Competitive Currency Devaluations Assessed
By: GoldCore - MarketOracle.co.uk
Gold has remained well bid above the $1,300/oz level and silver has risen another 0.7% and looks set to challenge the $22/oz level. Participants at the LBMA conference see gold rising to over $1,450/oz over the next year due to concerns about central banks' reaction to the economic crisis. LBMA delegates forecast silver to trade at $24/oz in 12 months time which it is a conservative estimate given the very strong technical and fundamental situation.

Gold Price Blasts through $1300.00/oz Barrier
By: Bob Kirtley - MarketOracle.co.uk
Gold prices were drifting lower during the trading session on the London Stock Exchange with a breather being the order of the day. Things changed dramatically when the New York Stock Exchange opened as gold prices reversed their loses, moving into positive territory and taking out the $1300.00/oz barrier to close at $1308.60/oz. Inflation adjustment aside, this is another new all time high, which gives us great pleasure to write about.

Gold hedges rise 2% in second quarter
Smaller miners add to global hedge book; larger players unwind
By Wallace Witkowski, MarketWatch
SAN FRANCISCO (MarketWatch) - Smaller gold miners are increasingly entering into contracts designed to buffer their results from falling gold prices, helping boost the total volume of gold hedges even as larger producers exit these positions, said GFMS Ltd. Wednesday.
The total amount of gold hedged rose 5 metric tons, or 2%, to 224 metric tons on a net basis in the three months ended in June from the March quarter, the first quarter of growth in at least 12 months, according to the London-based metals consultancy.

Silver Advances to Costliest Versus Gold in 11 Months
By Glenys Sim
Sept. 29 (Bloomberg) -- Silver climbed to the most expensive relative to gold in 11 months as investors sought to protect their wealth on speculation governments may add to monetary easing to help the recovery, weakening currencies.
The ratio of gold to silver dropped below 60 for the first time since October, falling as low as 59.8955. Silver has outperformed the yellow metal since June 30, advancing 17 percent against gold's 5.5 percent increase, as investors bought the commodity because of its comparative cheapness.
"Silver is trying to catch up with gold," said Ellison Chu, precious metals manager at Standard Bank Asia Ltd. "Gold is already at a record but silver is quite far from it."

John Paulson Lecture: "Bonds Are Wrong, Stocks Are Right"
by Tyler Durden - ZeroHedge.com
.... Gold - The price of gold has moved in correlation to the monetary base for as long as they have tracked the two data items. As the Fed prints more money, gold should rise. If the Fed were to increase the monetary base by 100% over the next 3 years, Gold should increase by that same amount. Additionally, as inflation accelerates, investors tend to push gold higher than its correlation, like in 1980 when it increased an additional 100% above the correlation. So if gold is at $1,200 now, it should hit $2,400 on the monetary expansion alone, then $4,000 as investors flee inflation. Additionally, he has offered his investors the ability to hold their investment in his fund in either US Dollars denominated or in gold denominated. Paulson himself has 80% of his assets gold denominated.

The US Does Not Own Or Control Its Money System
By: Graham Summers - MarketOracle.co.uk
What is money?
Most of our adult lives are devoted to making this stuff. Next to food, water, and sleep it's the #1 concern for most human beings in the US. Nearly 80% of divorced couples cite financial difficulties as a reason for the divorce. And the American Psychological Association reports that 73% of Americans cite money as a source of significant stress.
And yet, despite being the medium for every economic transaction in our financial system, few if any individuals actually understand what money is and how it works in today's Federal Reserve banking system.
So I ask again, what is money?
The common answer is: Dollar bills or coins.
The common answer is wrong.
The US monetary system is in fact entirely backed-by debt. Dollars are not actually assets, they are debt-backed instruments produced by the Federal Reserve. I realize this is difficult to swallow, but have a look at the Dollar bill itself.
Note the top of the bill does NOT read "US Dollar" or "official currency of the United States." Instead it reads "Federal Reserve Note."
So this bill is in fact, NOT produced or controlled by the US Government. . Instead, it's a note issued by the Federal Reserve.

U.S. Dollar Is 'One Step Nearer' to Crisis, Yu Says
By Shamim Adam and David Yong
Sept. 28 (Bloomberg) -- The U.S. dollar is "one step nearer" to a crisis as debt levels in the world's largest economy increase, said Yu Yongding, a former adviser to China's central bank.
Any appreciation of the dollar is "really temporary" and a devaluation of the currency is inevitable as U.S. debt rises, Yu said in a speech in Singapore today.
"Such a huge amount of debt is terrible," Yu said. "The situation will be worsening day by day. I think we are one step nearer to a U.S.-dollar crisis."
Yu also said China is worried about the safety of its foreign-exchange reserves including those invested in U.S. Treasuries as the U.S. currency weakens, reiterating his earlier views on the dollar assets. The U.S. will record a $1.3 trillion budget deficit for the fiscal year ending Sept. 30, the Congressional Budget Office said Aug. 19.

Dollar Set for Monthly Loss Versus Euro on U.S. Slowdown Signs
By Yoshiaki Nohara and Ron Harui
Sept. 30 (Bloomberg) -- The dollar headed for its biggest monthly loss since 2008 versus the euro as signs the U.S. economy is slowing damped demand for the nation's assets.
The dollar was set for a quarterly drop versus all of its major counterparts before data forecast to show U.S. business activity and manufacturing slowed. Federal Reserve Chairman Ben S. Bernanke is scheduled to testify in Washington today amid speculation the central bank is preparing to buy more U.S. debt. The yen traded near the strongest since the Bank of Japan intervened on Sept. 15. Japan's currency gained against the euro as Asian stocks fell, boosting demand for safer assets.

Capital controls eyed as global currency wars escalate
Stimulus leaking out of the West's stagnant economies is flooding into emerging markets, playing havoc with their currencies and economies.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Brazil, Mexico, Peru, Colombia, Korea, Taiwan, South Africa, Russia and even Poland are either intervening directly in the exchange markets to prevent their currencies rising too far, or examining what options they have to stem disruptive inflows.
Peter Attard Montalto from Nomura said quantitative easing by the US Federal Reserve and other central banks is incubating serious conflict. "It is forcing money into emerging market bond funds, and to a lesser extent equity funds. There has truly been a wall of money entering many countries," he said.

Asian Currencies to Beat Dollar, Mann Says
By Allison Bennett and Julie Hyman
Sept. 29 (Bloomberg) -- Asian currencies are the best bets against the dollar as currency markets anticipate quantitative easing from the Federal Reserve, said David Mann, head of research, Americas at Standard Chartered Plc.
"I think there are better bets out there rather than purely going with long the euro against the dollar, such as the Korean won, Indonesian rupiah and the Indian rupee," New York- based Mann said in a Bloomberg Television interview today with Julie Hyman and Mark Crumpton.

Deep Economic and Debt Frictions Triggering Competing Currency Wars
By: Jim Willie CB - MarketOracle.co.uk
Some prefatory stories are highly revealing. Bank of America is badly on the ropes. On the same weekend at the end of July, when the Bank For Intl Settlements executed a 340 ton gold swap contract, two other events happened. The London metals exchange apparently suffered coordinated delivery raids, all legal, but painful nonetheless, stripping the embattled exchange of much gold bullion. My source from the German banking fortress shared that the BIS might have rescued the London Bullion Market Assn, and thereby prevented a near default at the exchange. Spurious stories about aiding commercial banks, even the Portuguese central bank, were floated to distract the masses.

U.S. House Unites to Push China on Yuan as Frustration Mounts
By Mark Drajem
Sept. 30 (Bloomberg) -- Democratic and Republican U.S. lawmakers joined in sending a message that China must raise the value of its currency, as years of frustration resulted in the first legislation to pass a chamber of Congress on the issue.
The House of Representatives voted 348-79 yesterday for a measure that would let domestic companies petition for duties on imports from China to compensate for the effect of a weak yuan. Democrats were joined by 99 of the 178 Republicans on the vote.

House passes bill aimed at Chinese currency
By Charles Riley
NEW YORK (CNNMoney.com) -- Lawmakers say China's currency is unfairly cheap and passed a measure Wednesday that opens the door to tariffs that aim to help U.S. companies compete.
The legislation, which authorizes the Commerce Department to impose duties on imports from countries with undervalued currencies, passed the House of Representatives by a vote of 348 to 79. The Senate, however, is not expected to take up the issue until later this year.
The bill got support from both sides of the aisle, a rarity in recent sessions, with Democrats framing the legislation as a jobs issue.

The hidden tax from a yuan appreciation
Yuan rise isn't the free lunch its proponents say
WASHINGTON (MarketWatch) - Proponents of the bill trying to make it easier to impose sanctions on China over manipulating its currency say a stronger yuan is a way to bolster the economy without any cost.
After all, they reason, U.S. exports from the likes of Caterpillar, General Motors and General Electric would be more competitive in China were the yuan to have stronger purchasing power, creating an estimated 500,000 manufacturing jobs state-side without Congress having to spend a dime.

China Yuan Weakens for First Time in 13 Days After U.S. Vote
By Bloomberg News
Sept. 30 (Bloomberg) -- The yuan weakened for the first time in 13 days on speculation China won't accelerate appreciation in response to the threat of U.S. trade sanctions.
The central bank set the reference rate for daily trade weaker for the first time in three days after the House of Representatives yesterday voted 348-79 for a measure that would let domestic companies petition for duties on imports from China to compensate for the effect of a weak yuan. The yuan had gained 1.6 percent in the past 12 trading days.

Bank of England policy maker wants to debase the coinage even more
By Jeremy Warner - Telegraph.co.uk
Has Adam Posen, an external member of the Bank of England's Monetary Policy Committee, gone stark raving mad? In a speech on Tuesday to the Hull and Humber Chamber of Commerce, he advocated another bout of quantitative easing, warning in terms that advanced economies are stuck in a classic liquidity trap which requires further fierce, pre-emptive policy action to get us out. It's not inflation, but unemployment which is the real challenge for public policy, he insists.
Mr Posen derives his analysis from study of the Great Depression and Japanese experience over the past twenty years, the latter being one of his acknowledged areas of expertise. Knowledge of history is all very well, but why doesn't he try the present? As yet neither of these two parallels are relevant. We are in neither a repeat of the Great Depression nor are we playing out the policy errors that have condemned Japan to its two lost decades. Instead, we are in slow recovery mode, which though it feels very much like a recession is not a depression, and is a long way from justifying further debasement of the coinage by printing another shed load of new money.

Rahm Emanuel, White House chief of staff, expected to resign
Barack Obama's senior aide, a profane 'piledriver', looks likely to quit so he can seek to become mayor of Chicago
Chris McGreal in Washington - guardian.co.uk
Rahm Emanuel, the US president's chief of staff and the "piledriver" tasked with delivering the Obama administration's agenda, is expected to resign this week to seek to become Chicago's mayor.
The American press quoted White House sources as saying that Emanuel would quit on Friday under pressure from the president to make a decision about his future.
Obama is aware that speculation is creating instability at a time when the administration is focusing on November's midterm elections, which are expected to result in heavy losses to the Republicans.

Full text of address to Congress by Fed's Bernanke
DAYTON BUSINESS JOURNAL
Federal Reserve Chairman Ben Bernanke will address the U.S. Senate Committee on Banking, Housing and Urban Affairs Thursday, Sept. 30.
The following is the full text of his prepared remarks as released in advance on the Fed's Web site:
Regulatory Reform Implementation
Chairman Dodd, Ranking Member Shelby, and other members of the Committee, thank you for the opportunity to testify about the Federal Reserve's implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (Dodd-Frank Act).

Bernanke has votes for asset purchases, analysts say
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) - While discord at the Federal Reserve is on full display, Ben Bernanke has the votes he needs to buy government bonds if the Fed chairman decides that more asset purchases would help the economy avoid deflation and another recession, analysts say.
In a series of speeches over the past two days, Fed officials made clear that they disagree about whether to embark on a second round of quantitative easing.
"Will it work and how much would be needed to make a difference? In my view a consensus on these pivotal questions remains to come together," said Dennis Lockhart, the president of the Atlanta Fed, in a speech delivered Tuesday.

Yellen, Raskin Win Senate Confirmation as Fed Board Members
By Scott Lanman
Sept. 29 (Bloomberg) -- The U.S. Senate confirmed two nominees for the Federal Reserve Board, including Janet Yellen as vice chairman, clearing the way for the new members to vote on a potential second round of unconventional monetary easing.
The chamber today approved Yellen, currently president of the San Francisco Fed, and Sarah Bloom Raskin, Maryland's commissioner of financial regulation, in a late-night voice vote ahead of Congress's adjournment for the Nov. 2 midterm elections.
Yellen, 64, and Raskin, 49, will join the Fed's Board of Governors as policy makers debate taking action to reduce borrowing costs and help lower unemployment persisting near a 26-year high. Some economists predict Chairman Ben S. Bernanke and colleagues will resume large-scale asset purchases, or quantitative easing, at the central bank's Nov. 2-3 policy meeting.

Fed Presidents Far From Unanimous on Need for Further Easing
By Scott Lanman and Craig Torres
Sept. 29 (Bloomberg) -- Regional Federal Reserve presidents showed they're far from unanimous on whether the central bank should try to boost flagging U.S. growth with a second round of unconventional monetary easing.
Policy makers have the tools to act and should respond "vigorously, creatively, thoughtfully and persistently" to a slow recovery, Boston Fed President Eric Rosengren said in a New York speech today. He spoke minutes after Philadelphia Fed President Charles Plosser said in New Jersey that the central bank would put its credibility at stake by taking actions such as buying more securities that may fail to reduce unemployment.

Government shutdown looming?
Michael Tomasky - Guardian.co.uk
Jim DeMint, Republican senator of South Carolina/Tea Party fame, is threatening to shut the government down as of Sept. 30. It's all very complex procedural stuff, but it is well explained by this Daily Kos post from David Waldman.
The post starts out quoting Roll Call:

Traditionally, the Senate passes noncontroversial measures by unanimous consent at the end of most workdays, a process known as hot-lining. DeMint, Sen. Tom Coburn (R-Okla.) and others have fought against the practice for years and have dedicated staff members to reviewing bills that are to be hot-lined.
As a result, Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) have generally given DeMint, Coburn and others time to review legislation before proceeding with unanimous consent agreements.
But in a terse e-mail sent to all 100 Senate chiefs of staff Monday evening, Steering Committee Chief of Staff Bret Bernhardt warned that DeMint would place a hold on any legislation that had not been hot-lined or been cleared by his office before the close of business Tuesday.

Okay, got that? Let me provide a little context by saying that for the better part of two centuries, both parties permitted unanimous consent on noncontroversial bills. Until Tom Coburn and Jim DeMint came along.
Even so, Coburn and DeMint usually agree to let minor bills pass through. But this week, with adjournment scheduled for Thursday, DeMint has just threatened to personally hold back any legislation, no matter how minor, that isn't agreed to by close of business today.

Senate OKs stop-gap spending, ready to go home
By Jennifer Liberto and Jeanne Sahadi,
WASHINGTON (CNNMoney.com) -- The Senate on Wednesday passed a measure to fund the federal government another two months, the last major legislative action before lawmakers shut down and return to the campaign trail for the Nov. 2 elections.
The Senate voted 69-30 to pass and send to the House a stop-gap effort that effectively keeps the light on at agencies and major federal programs until Dec. 3. The tab for the 64 days tops $219 billion, meaning the overall budget for the new fiscal year will be $219 billion lighter, a congressional aide explained.

If the Recession Has Ended, Why Is the Fed So Worried?
By: Claus Vogt - MarketOracle.co.uk
The National Bureau of Economic Research (NBER) is the official arbiter of U.S. economic history. It sets the officially accepted dates for the beginning and the end of U.S. recessions. And on September 20, its Business Cycle Dating Committee published an important statement É
It finally declared the end of the recession that began in December 2007. Here is an excerpt from what it had to say:
"The committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion.
"The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months."

The Cost of Fed Incompetence
By: Richard Daughty - MarketOracle.co.uk
I have grown old yelling at my neighbors and family members to buy gold, silver and oil, to little-to-no avail, and I can see that they are getting bored with my same old million reasons why they should, and how their deliberate inaction only proves their stupidity, which I never tire of pointing out, so they can't say that they "didn't know" that they were stupid.
So, recently, I was standing in the street outside of Griswald's house, telling Old Man Griswald how he was an idiot for not buying gold, silver and oil as the only rational defense against the inflationary horror unleashed when his own stupid government (that he and his loathsome Leftist friends elected over and over again) was deficit-spending so unbelievably much money, dutifully created by the foul Federal Reserve, which is a complete failure as an institution if ever there was one, having destroyed 98% of the buying power of the US dollar since the Fed's inception in 1913 by creating too much money and credit, when their original purpose was to "keep prices stable," to which I cynically laugh in Sneering Mogambo Rebuke (SMR) "Hahahaha!"

Coming this November: Taxes tug-of-war
By Tami Luhby
NEW YORK (CNNMoney.com) -- State legislatures will be in a high-stakes tug-of-war with both voters and industry at the ballot box this November.
More than a quarter of the 155 ballot initiatives to be decided on Nov. 2 deal with state tax hikes, debt levels and other revenue issues. In total, there are 44 measures that could drastically change the way states fund themselves or make decisions on their budgets.
Anti-tax crusaders have long used ballot measures to keep lawmakers in check, but this year the two sides are wrestling with how to close monstrous budget gaps. State and local officials have had to raise taxes and slash services over the past three years in order to balance their budgets.

Dow 'Super Boom' to Send Gauge to 38,820, Hirsch Says
By Tara Lachapelle and Nikolaj Gammeltoft
Sept. 27 (Bloomberg) -- The Dow Jones Industrial Average will surge to 38,820 in an eight-year "super boom" beginning in 2017, according to Jeffrey A. Hirsch, editor in chief of the "Stock Trader's Almanac."
"All previous major economic booms and secular bull markets were driven by peace, inflation from war and crisis spending, and ubiquitous enabling technologies that created major cultural paradigm shifts and sustained prosperity," he wrote in a press release sent with the 44th edition of the book.

For US Corporations the Whole of the Law Shall Be
'Do What Thou Wilt' Over There
JESSE'S CAFÉ AMÉRICAIN
The trend seems to be to extend all the rights and protections of citizens to the multinational coporations while increasingly limiting their liabilities.
I have not read a legal interpretation of this, and it could be overstated in its reach, but it does fit with a disturbing trend in the US whereby more power and wealth is being concentrated in corporations who can act with increasing advantage vis-ˆ-vis the individual. Barry Ritholz has framed it quite well in his piece:

The Left Right Paradigm is Over: Its You vs. Corporations
By Barry Ritholtz
Every generation or so, a major secular shift takes place that shakes up the existing paradigm. It happens in industry, finance, literature, sports, manufacturing, technology, entertainment, travel, communication, etc.
I would like to discuss the paradigm shift that is occurring in politics.
For a long time, American politics has been defined by a Left/Right dynamic. It was Liberals versus Conservatives on a variety of issues. Pro-Life versus Pro-Choice, Tax Cuts vs. More Spending, Pro-War vs Peaceniks, Environmental Protections vs. Economic Growth, Pro-Union vs. Union-Free, Gay Marriage vs. Family Values, School Choice vs. Public Schools, Regulation vs. Free Markets.

Financial Fraud and the Global Derivatives Casino,
Mechanisms of the Scam
By: Matthias Chang - MarketOracle.co.uk
Part 1 - The Mechanics of the Derivative Scam
The fact that common folks in the US and other developed countries have not come out in arms to lynch the central bankers and their accomplices in Wall Street and other banking centres is an indication how effective the financial elites have been able to hoodwink and confuse the masses.
$Trillions have been wiped out but hardly anyone of substance has demanded criminal prosecutions. Fraud, massive frauds have been committed by top bankers, lawyers, accountants, regulators and politicians of all hues but none had to pay for their crimes.

Ireland pushed towards brink
By HUGO DUNCAN - DailyMail.co.uk
The Irish parliament reconvenes today with protesters on the streets of Dublin, the country in crisis and the government fighting for survival.
A tidal wave of economic troubles - from a sharp drop in output over the spring to the rising cost of bailing out the banking system - has pushed Ireland to the brink.
The turmoil has drawn unwanted comparisons with Greece and triggered fears that the once-mighty Celtic Tiger will be crippled by a debt crisis of its own.
Dublin's battle to convince investors it can afford to shore up a banking system devastated by the collapse of the Republic's property bubble - and cut the biggest budget deficit in the EU - faces a key test this week.

Europe hit by wave of anti-austerity protests
Marches paralyse centre of Brussels
while Spain sees first general strike in eight years
Ian Traynor and Elena Moya - guardian.co.uk
Tens of thousands of protesters took to the streets of Europe today as strikes against austerity measures that have hit public spending and services on the continent caused widespread disruption.
The main demonstrations were in Spain, Belgium and Greece, although there was co-ordinated action in more than a dozen countries including Portugal, Ireland, Slovenia and Lithuania.
One of the largest protests converged on a park in Brussels. The demonstrations in the European capital were reinforced by Spain's first general strike in eight years, which was called to oppose the Spanish government's spending cuts and reforms of the labour market and pensions. In Portugal, unions said 50,000 protesters joined a march in Lisbon and 20,000 in Porto.

Unraveling - Things are coming apart before our eyes
Fred Cederholm - SilverBearCafe.com
I've been thinking about unraveling. Actually I've been thinking about the Obama administration, unemployment, housing, Afghanistan, our economic/ financial messes, the coming November elections, October surprises, and sand. Sunday I was gone all day. I went to church, I stayed for Sunday school, I went out to eat, and I attended a memorial service for a long time friend, Bud Elkin. I thought I looked pretty good in my khaki slacks, a white knit golf shirt, and my burgundy colored sweater over the top. I needed the sweater because it was cool - Fall was rapidly descending on us here. What I didn't realize was that I had snagged the sweater around the side of the waist band. One thread of the wool yarn had apparently broken and as the day progressed, I was coming apart at the seams - literally! The progression of the unraveling was brought to my attention by numerous people during the day. Each time I thanked them for the information, but I kept TH*NK*NG why was the public not so astute at assessing the unraveling of the Obama Administration, and the US economic situation.

MetLife Probed by Regulators as Asset Accounts Called Deceptive
By David Glovin
Sept. 28 (Bloomberg) -- Regulators in three U.S. states have started or widened examinations of how life insurers pay beneficiaries after a federal judge described MetLife Inc.'s marketing of asset accounts as "inherently deceptive," even as he dismissed the underlying suit against the company.
The Sept. 10 statement by U.S. District Judge Larry Hicks in Reno, Nevada, may prompt regulators in that state, California and Georgia to use their broad legal powers to impose changes on insurers' marketing, disclosures and practices.

Meredith Whitney's new target: The states
by Shawn Tully - Fortune CNNMoney.com
The housing crash not yet realized its full impact on budgets in the most vulnerable states. It's the banking crisis all over again - and it's time to stop ignoring it.
Meredith Whitney, the superstar analyst who famously forecast disaster for America's big banks before the credit crisis struck, is now warning about another looming threat: The wreckage from over-stretched state budgets.
Today, Whitney is releasing a 600-page report, colorfully entitled "The Tragedy of the Commons," that rates the financial condition of America's 15 largest states, measured by their GDP. Whitney claims that the study is the most comprehensive, in-depth analysis of the states' murky patterns of spending, revenues and benefits programs ever assembled by the government, foundations, or another research firm.

States Are Poised to Be Next Credit Crisis for US: Whitney
By: Jeff Cox - CNBC.com Staff Writer
Crippling debts and deficits are about to make individual states the next casualty of the credit crisis, analyst Meredith Whitney told CNBC.
Speaking as her firm, Meredith Whitney Advisory Group, just released a lengthy report on the state of the states, the noted financial analyst compared the looming explosion to the collapse of the financial system in 2008 and 2009.

Corporate Mortgage Scams Threaten to Crash
an Already Shaky Housing Market
A foreclosure pandemic riddled by corruption may stall America's recovery - By Scott Thill - AlterNet
The Great Recession may have ended in June 2009, according to the National Bureau of Economic Research, but U.S. Treasury Secretary Timothy Geithner isn't buying it. Neither are recently revealed foreclosure and eviction scams at GMAC Mortgage, JP Morgan Chase, Bank of America, Wells Fargo and other too-big-to-fail financial firms swimming in both American taxpayer cash and the Federal Reserve Bank's divine intervention.
"I'm not an economist, and I'm not an academic," Geithner ducked when asked last week during a Financial Services Committee hearing to agree with NBER's suspicious assessment. "I would just say the following: This is still a very tough economy."

Housing Finance Needs U.S. Backstop, Executives Tell Lawmakers
By Lorraine Woellert
Sept. 29 (Bloomberg) -- Congress must preserve some form of U.S. guarantee on mortgages to attract private capital to the housing-finance system and stabilize a market recovering from the credit crisis, industry executives told lawmakers.
Private capital must play a bigger role in housing finance as policy makers replace the current system, which is dependent on guarantees from government-backed Fannie Mae and Freddie Mac, the executives said today in testimony prepared for a House Financial Services Committee hearing. U.S. support will still be needed to keep loans flowing to borrowers and preserve products such as 30-year, fixed-rate mortgages, they said.

D-FW foreclosures hit starter, luxury homes
DALLAS BUSINESS JOURNAL - BY Kerri Panchuk WEB REPORTER
Both affluent and entry-level homebuyers are bearing the brunt of the recession's aftermath, according to new foreclosure data compiled by Addison-based Foreclosure Listing Service Inc.
A new report from the firm says 80 percent of the homes posted for foreclosure in a 19-county area in North Texas were priced at $200,000 or below.
George Roddy, Sr., president of Foreclosure Listing Service, said, "The largest gains in residential foreclosure posting activity were found at opposite ends of the Texas housing market among entry-level homes and ultra-luxury homes."

The Real Inequality Scandal: Rich, Poor and MSM
Gang Up On American Middle Class
Steve Sailer - SilverBearCafe.com
Economic inequality has been much in the press lately. For example, Timothy Noah wrote a ten-part series for Slate trying to explain the growth in inequality. Greatly to Noah's credit, he dared consider the role of immigration in his Part 3: Did Immigration Create the Great Divergence? (albeit inadequately, as Ed Rubenstein has pointed out).
But, generally, the discussion about inequality has been missing half of the puzzle.
On the one hand, it's safe to say that over recent decades, the very rich have gotten very much richer.
The farther up the pyramid you are, the faster the growth has been. The rise in income has been slower for the top ten percent than for the top one percent, and the top one percent has lagged behind the top 0.1 percent.

Jack in the Box closures bypass Phoenix
PHOENIX BUSINESS JOURNAL - BY Mike Sunnucks
Fast food chain Jack in the Box Inc. said today it will close 40 restaurants nationwide by Sunday.
None of the closed locations are in the Phoenix market, but one Arizona location outside the Valley being closed. The San Diego chain would not disclose that location.
Jack in the Box has 178 restaurants in Arizona and 2,200 locations in 18 states.
The stores on the closure list are underperforming and are all company-owned, officials said. Most of the closures will happen in Texas and the Southeast.

U.S. Unemployment Rate Could be Higher in September vs. August
By: Asha Bangalore - MarketOracle.co.uk
The Conference Board's Consumer Confidence Index slipped to 48.5 in September from 53.2 in August. The September reading is the lowest since February 2010 (46.4). The historical low is 25.3, registered in February 2009. The University of Michigan Consumer Sentiment index also declined in September (66.6 vs. 68.9 in August). The decline in consumer outlook appears to be tied to the prevailing conditions in the job market. Although the recent recession officially ended in June 2009 and real GDP has posted growth for four straight quarters, the 9.6% unemployment rate in August is an elevated level playing an important role in the pessimistic outlook of consumers.

U.S. Social Inequality Income Gap Hits Record High
By: Global Research - MarketOracle.co.uk
David Walsh writes: Figures released Tuesday by the US Census Bureau reveal sharply worsening conditions for tens of millions of Americans under the impact of the economic crisis and the accumulation of vast wealth by a relative handful.
Some of the figures, for particular states and regions, are simply staggering. Michigan residents experienced a 6.2 percent decrease in median income in the course of one year, from 2008 to 2009, while Illinois has suffered a 24 percent increase in poverty in the past decade. More than 36 percent of Detroit's population officially lives in poverty.
Overall, the 2009 American Community Survey reveals that median household income fell in the US nearly 3 percent between 2008 and 2009, from $51,726 to $50,221. This was the second consecutive year in which household incomes dropped. Median income declined in 34 states, and increased only in sparsely populated North Dakota.

Apple's final frontier: The enterprise
By David Goldman,
NEW YORK (CNNMoney.com) -- Apple became the most valuable technology company by winning over the hearts and minds of consumers. But until recently, corporate customers have been an afterthought.
Not anymore.
Small businesses and large corporations alike are beginning to embrace Apple by supporting and purchasing iPhones, iPads and Macintosh computers for their employees and by creating applications for their customers' Apple devices.
Tim Cook, Apple's chief operating officer, noted on a July conference call with analysts that 50% of Fortune 100 companies are already deploying or thinking about using the iPad for corporate use and 80% were supporting the iPhone.

Barack Obama under fire for grossly underestimating Gulf oil spill
White House commission finds that administration lost public trust and may have sabotaged clean-up operations
Suzanne Goldenberg, US environment correspondent - The Guardian
The Obama administration lost the public trust and may have sabotaged clean-up operations in the Gulf of Mexico by grossly underestimating the amount of oil gushing from BP's broken Macondo well, according to a White House commission appointed to investigate the spill.
In a scathing critique of the administration's handling of the disaster, the two co-chairs of the commission yesterday said government officials made a serious blunder by releasing early estimates of the spill that were about 60 times too low.
"It's a little bit like Custer underestimating the number of Indians on the other side of the hill and paying a price for that," Bob Graham, a former Democratic senator from Florida, told reporters.

New Earth-like planet discovered
Gliese 581g in 'Goldilocks zone' of space where liquid water could exist is strong contender for a habitable world
Ian Sample, science correspondent - guardian.co.uk
Astronomers have discovered a potentially habitable planet of similar size to Earth in orbit around a nearby star.
A team of planet hunters spotted the alien world circling a red dwarf star called Gliese 581, 20 light years away.
The planet is in the "Goldilocks zone" of space around a star where surface temperatures are neither too hot nor too cold for liquid water to form.
"Our findings offer a very compelling case for a potentially habitable planet," said Steven Vogt, an astronomer at the University of California, Santa Cruz. "The fact that we were able to detect this planet so quickly and so nearby tells us that planets like this must be really common."
If confirmed, the planet would be the most Earth-like that has ever been discovered in another solar system and the first strong contender for a habitable one.

ROBERT GATES WANTS YOU ... AND YOUR CHILDREN
The defense secretary warned Duke University, and anyone else who would listen, about a growing divide between the public and the military that has created a minority class of professional military workers and a detached, if vaguely supportive, civilian population.
Gates said most Americans think of fighting as "something for other people to do" and said, "There is a risk over time of developing a cadre of military leaders that politically, culturally and geographically have less and less in common with the people they have sworn to defend."
He was short on solutions, but the secretary suggested more attractive pay and benefits.

China, U.S. Turn to Maritime Agenda as Military Talks Resume
By Viola Gienger
Sept. 30 (Bloomberg) -- The U.S. and China will confer on maritime issues next month as the two countries resume military talks broken off after the Obama administration announced an arms sale to Taiwan earlier this year, a Pentagon spokesman said.
That discussion will be followed by full "defense consultative talks" in Washington later this year like those held last year in Beijing, Marine Corps Colonel David Lapan said. The June 2009 sessions marked the first in 1-1/2 years after a previous China-imposed hiatus following a U.S. weapons sale to Taiwan.

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Wednesday 09.29.2010

America on the brink of a Second Revolution
2010 elections guarantee gridlock, anti-capitalist class war
By Paul B. Farrell, MarketWatch
ARROYO GRANDE, Calif. (MarketWatch) -- "What's distinctive about the Tea Party is its anarchist streak -- its antagonism toward any authority, its belligerent self-expression, and its lack of any coherent program or alternative to the policies it condemns," warns Jacob Weisberg in Newsweek. But why not three cheers for the Tea Party Express?
Admit it, something historic is brewing. And yes, it's good for America, even the anarchy. Revolution is renewal. Tea-baggers want to take on both parties, "restore honor" and "take back the country." Bring it on, the feeling's mutual.

THE TIME HAS ARRIVED: IS REBELLION AT HAND?
By Greg Evensen - NewsWithViews.com
The countdown clock and the last chance for "The Founder's Legacy" of patriotic Americans willing to lay it all on the line for a new Republic, has hit 0:00. Rebellion is no longer an option, a late night "what if" discussion around a bottle of good wine and snacks. It is now the mandated response of oath keeping citizens and Constitutional defending men and women who have heard Paul Revere in 2010. That "watchman," who made the most famous call to prepare for rebellion in the history of the world, has come again, through all of us who have been riding across our land for several years and warned of the arrival of this most critical moment. It did not materialize lightly or without a desperate realization that it was on the way, and when it did appear at the horizon, life has not and will not ever be the same. Whether you accept this assessment or not, you will be involved in its reality, prepared or not, on board with the need to reclaim this country for freedom's sake or not, courageous enough to muster with the band of the free and brave or not, you WILL still be counted among those who stood and fought with your countrymen, or posterity will judge you as cowards unworthy to live free.

The United States is a dead man walking
By Sheriff Jim R. Schwiesow, Ret. - NewsWithViews.com
The story is that when a condemned convict has finally exhausted his appeals, stays, and pre-execution pleas and is making that final walk to the execution chamber his last faltering steps are marked by these echoing words, "Dead man walking." The words are chilling and at the same time prophetic as they mark with a certainty that soon - very soon - the vital physical functions that sustain life and animate the being will be terminated and he will go from life to death and exist only as a memory.
It occurs to me that nations and civilizations are like men in that they live and function, establish relationships, make enemies and friends, inhabit a temporary space as an infinitesimal speck in a boundless universe, enter into a terminal stage and die, are mourned for a while, and then exist only as a memory. Some live longer than others, some are more prominent than others, some are more benevolent than others, some are more evil than others, but all enter into that final stage and ultimately perish.

States Are Poised to Be Next Credit Crisis for US: Whitney
By: Jeff Cox - CNBC.com Staff Writer
Crippling debts and deficits are about to make individual states the next casualty of the credit crisis, analyst Meredith Whitney told CNBC.
Speaking as her firm, Meredith Whitney Advisory Group, just released a lengthy report on the state of the states, the noted financial analyst compared the looming explosion to the collapse of the financial system in 2008 and 2009.
"The similarities between the states and the banks are extreme to the extent that states have been spending dramatically and are leveraged dramatically," she said. "Municipal debt has doubled since 2000, spending has grown way faster than revenues."

Gold soars above $1,300 an ounce
Yellow metal back at record high; silver also returns to 30-year peak - By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold cast off initial weakness to settle at a fresh record high above $1,300 an ounce Tuesday, thanks to a weaker dollar and the worst reading on U.S. consumer confidence in seven months.
It was quite a comeback for gold, which started the day in the red but managed to finish above the key psychological mark of $1,300 an ounce.

China set to take centre stage in gold market
By Jan Harvey - Berlin
(Reuters) - The easing of restrictions on China's gold imports should boost its influence on global bullion trade as Chinese investors turn to the open market to satisfy their hunger for the metal, the World Gold Council said.
Chinese gold demand is expected to show at least single digit percent growth this year at a time when high prices are curbing buying in other major physical markets like India, the WGC's Far East managing director Albert Cheng said on Tuesday.

Gold prices set record high on investor worries
By Sandy Shore, Associated Press
Gold prices settled at a record high Tuesday as investors looked for a safety net after sorting through a batch of mixed economic news.
Gold also got a helping hand from a weaker dollar as it rose $9.70 to settle at $1,308.30 an ounce. Earlier in the day, it reached $1,311.80 an ounce.
It's the latest in a series of recent record-setting days for gold as investors seek alternatives to the jittery stock market as prospects for the economy remain uncertain. Many analysts expect the price to continue to climb.

Gold rallies to another record high
By Ben Rooney
NEW YORK (CNNMoney.com) -- Gold prices continued to push higher Tuesday, reaching another record high, amid ongoing concerns about the economy.
Gold futures for December delivery rose $9.70 to settle at $1,308.30 an ounce, topping Monday's all-time closing high of $1,298.60 an ounce.
The metal has hit a series of record highs in recent weeks, including a new all-time trading high of $1,311 an ounce earlier Tuesday.
Gold is up 4.7% over the last month, and has gained more than 30% so far this year.

Is the Gold Rally Strictly a US Dollar Phenomenon?
JESSE'S CAFÉ AMÉRICAIN
One sometimes hears that 'gold is only rallying in US dollars.'
One can always point out that since the US dollar is still the world's reserve currency, it affects everything and everyone that hold it in their reserves or their assets on deposit. A good part of the recent crisis in Europe was caused by the severe deterioration in dollar denominated financial assets held on deposit in commercial banks by private customers, who started to demand their money, in dollars. This precipitated a dollar squeeze and a liquidity crisis.
There is clearly a safe haven trade in gold denominated in US dollars.

Gold well supported by Central Bank buying
By Dan Denning - CommodityOnline.com
The two biggest members of the former Communist/Red/Central Planning club yesterday finalised a deal yesterday to send 300,000 barrels a day of Russian oil to the Chinese city of Daqing for the next twenty years. It's a $26 billion loan-for-oil agreement that comes with an actual oil pipeline between eastern Siberia and north-east China.
--Why wasn't this story front page news? Because gold is making new highs and oil is not. Oil is a jilted commodity at the moment. Traders remember what it did to them in 2008 after the bubble popped. But if you're a contrarian, you want to pay attention to the stories that are not making headlines. Hence, oil.

Stay in Cash and Gold; don't buy stocks at all
The Gold Report: The National Bureau of Economic Research announced last week that not only are we out of the recession but that in fact, it ended in June 2009. They did note that it was the longest recession since the Great Depression. Did this announcement surprise you?
Porter Stansberry: On one hand, I expected the authorities to come out and say everything is getting better at some point, and I also expected that pumping enough money into the economy could stimulate some economic activity. So, I guess in that way, I was expecting it.

John Paulson's Scary Speech:
Double Digit Inflation By 2012, Gold At $4,000
by Courtney Comstock - businessinsider.com
John Paulson scared the pants off of a packed audience at New York's University Club recently as he warned them of huge changes in the economic environment in the years to come.
Forbes' Bob Lenzer reports Paulson's saying:
"If you don't own a home buy one."
"If you own one home, buy another one, and if you own two homes buy a third and lend your relatives the money to buy a home."
Paulson has been bullish on housing for a while now (he runs a housing recovery fund), but this is him hitting super-bull territory. His reasoning is that home prices are great, the bond market is dead, and commodities like gold, which he also has a big prediction for, are on the rise.

US Mint working to finalize 2011 Buffalo Gold Coin plans;
2010 sales suspended
By Allen Sykora of Kitco News - CommodityOnline.com
(Kitco News) - The U.S. Mint is working to finalize plans to produce 2011 American Buffalo one-ounce gold bullion coins after sales of the 2010 coins were halted last week.
The agency sent a memorandum to authorized dealers, dated Sept. 23, announcing that the inventory of 2010 American Buffalo one-ounce gold bullion coins was depleted. No additional ones will be manufactured.
Sales for the year to date were 209,000, said Tom Jurkowsky, director of public affairs for the U.S. Mint. The 2010 coins were first offered April 29. The figure is up from 200,000 of the coins sold in 2009, when they were only available for the October-December period.

Money transfers could face anti-terrorism scrutiny
By Ellen Nakashima - Washington Post Staff Writer
The Obama administration wants to require U.S. banks to report all electronic money transfers into and out of the country, a dramatic expansion in efforts to counter terrorist financing and money laundering.
Officials say the information would help them spot the sort of transfers that helped finance the al-Qaeda hijackers who carried out the Sept. 11, 2001, attacks. They say the expanded financial data would allow anti-terrorist agencies to better understand normal money-flow patterns so they can spot abnormal activity.

Shut Down the Fed (Part II)
By Ambrose Evans-Pritchard - Telegraph.co.uk
I apologise to readers around the world for having defended the emergency stimulus policies of the US Federal Reserve, and for arguing like an imbecile naif that the Fed would not succumb to drug addiction, political abuse, and mad intoxicated debauchery, once it began taking its first shots of quantitative easing.
My pathetic assumption was that Ben Bernanke would deploy further QE only to stave off DEFLATION, not to create INFLATION. If the Federal Open Market Committee cannot see the difference, God help America.

Markets could correct in October-November: Marc Faber
IndiaTimes.com
You are known as Mr Contrarian in India. You always like to advise the reverse of what the global consensus is. The current global consensus is 'buy emerging markets and sell US bonds'. What is your take?
That's correct and there in general, I am still positive about economic growth in the emerging world. But what disturbs me at the present time is that in late August, sentiment was very negative worldwide and people said that Dow will drop to 1000 and so forth and so on. Suddenly now, the consensus is that you have to be in equities, you have to be in gold, you have to be in assets because central banks around the world will print money. That is correct, they will print money. But sentiment has become so universally bullish that about all assets, including especially emerging economies - in US dollar terms - are up. The Indian market this year is already up 19%, Malaysia 28%, the Philippines, Indonesia and Thailand each over 40%.

Debtflation
By David Galland, Managing Editor, The Casey Report
.... First off, I want to congratulate the reader for trying to anticipate the conditions that might mark the end of the gold bull market. Because, make no mistake, the gold bull market will come to an end - and when it does, it's not going to be pretty for those who stubbornly stay too long at the party.
As to the possible triggers for gold's big sell-off, the reader's contention is directionally correct when he points out that this could occur when real interest rates (T-bill rates minus CPI) become high enough. At that point, as a non-yielding asset, gold will become less attractive to investors looking for income. And, gold will fall.
However, the situation today is significantly different than during Volcker's term as the head of the Fed.

U.S. House Likely to Urge China to Raise Its Currency
By SEWELL CHAN - NYTimes.com
WASHINGTON - The House is expected to give the Obama administration another tool in its diplomatic pouch to pressure China to let its currency rise in value, reflecting growing concern around the country over the loss of manufacturing jobs, persistently high unemployment and a rising trade deficit.
In what is likely to be one of Congress's last significant measures before the election, the House will vote Wednesday on a symbolic but not insignificant measure threatening China with punitive tariffs on its imports to the United States.

Obama tax plan: Who gets hit - and why
By Roberton Williams
WASHINGTON (CNNMoney) -- Roberton Williams is a senior fellow at the Urban Institute and contributor to TaxVox, the blog of the nonpartisan research organization Tax Policy Center. He was at the Congressional Budget Office from 1984 through 2006. The opinions expressed in this commentary are solely those of the writer.
President Obama's plan to raise taxes on the nation's highest income households may not quite mean what you think.
A closer look suggests that fewer people may get whacked than either Obama or his Republican critics suggest.

More Fed action: How would it work?
By Neil Irwin - WashingtonPost.com
The debate over new Federal Reserve efforts to boost the economy has rapidly migrated from "whether" to "how."
Since Fed officials met last week and signaled they are open to new steps to try to strengthen the economy, chatter has flown around financial markets about the possibility of a major new infusion of cash, on the order of $1 trillion.
Some of this talk is a little premature: It is not a given that the Fed will take action at all at its the Nov. 2-3 meeting. If economic data come in surprisingly good over the coming weeks -- or inflation shows signs of rising -- the Fed may not intervene. But here is a guide to the range of technical and strategic questions that Fed leaders will need to resolve, should they choose to act, on how to ease monetary policy and stimulate growth. These are the questions that have already started to occupy both officials within the Fed and the outside analysts who scrutinize their every move.

Congress Will Only Worsen China Trade Ties
By: Reuters - CNBC.com
Congressional passage of a bill to pressure Beijing to revalue its currency could further harm U.S.-Chinese trade relations already hampered by mutual mistrust and suspicion, U.S. companies invested in China said Monday.
With U.S. congressional elections looming on Nov. 2, many U.S. lawmakers who blame unfair Chinese trade practices for American job losses are eager to show they are taking steps to get tough with Beijing and help tackle high U.S. unemployment.
The U.S. Congress is considering legislation that would treat what lawmakers call China's undervalued yuan currency as an export subsidy, a step that would give the U.S. Commerce Department increased ability to slap duties on Chinese goods.

Final Senate jobs bill fails
By Stephen Dinan - The Washington Times
The jobs agenda put forth by Senate Democrats has begun to lose support within their own caucus, including a Tuesday vote in which a bipartisan filibuster defeated a bill to stop jobs from being shipped overseas.
The bill and a stopgap spending measure were likely the last major debates before Senators leave town this week to prepare for November's elections.
The jobs bill would have offered a payroll tax break to companies that move jobs from overseas to the United States and would have withdrawn tax writeoffs from companies that laid off U.S. workers and replaced them with employees overseas.

U.S. Economy "Close to a Destructive Tipping Point,"
Glenn Hubbard Says
by Aaron Task - TechTicker.com
"America is very close to a destructive tipping point," co-authors Glenn Hubbard and Peter Navarro warn in their new book Seeds of Destruction. "We must change how we conduct our politics and economics...or we will inevitably go the way of all once-great nations and suffer an irreversible decline."
Hubbard, dean of Columbia Business School, joined Dan Gross and I to discuss the "major structural imbalances" facing America, chief among them being the government's profligate spending.
Hubbard, you may recall, was chairman of the President's Council of Economic Advisers during George W. Bush's first term. As you might expect, he is a strong advocate of smaller government and lower taxes. But Hubbard and Navarro, a business professor at UC Irvine, are also harshly critical of Bush's "gross mismanagement" of the fiscal stimulus bequeathed to his administration by President Clinton. Specifically, Hubbard chastises his former boss for the creation of a new unfunded federal mandate, Medicare Part D.

Consumer Confidence Falls to Lowest Level Since February
By: Reuters - CNBC.com
U.S. September consumer confidence sagged to its lowest levels since February, driven by deteriorating labor market and business conditions, according to a private report released Tuesday.
The Conference Board, an industry group, said its index of consumer attitudes fell to 48.5 in September from a revised 53.2 in August.
"September's pull-back in confidence was due to less favorable business and labor market conditions, coupled with a more pessimistic short-term outlook," said Lynn Franco, director of The Conference Board Consumer Research Center.

Home prices give up ground
Consumers' confidence falls -
By Patrice Hill - The Washington Times
Home prices and consumer confidence took a turn for the worse in recent weeks, economic reports said Tuesday.
The Conference Board reported its consumer confidence index this month fell to the lowest level since February, while Standard & Poor's Corp. said that home prices decelerated again in July.
An index of prices in the top 20 American cities showed an annual gain of 3.2 percent, down from 4.2 percent in June, S&P said. Prices overall are at levels last seen in late 2003.
Home prices have been sliding since the expiration of a federal tax credit for homebuyers in April.

Anger as a Private Company Takes Over Libraries
By DAVID STREITFELD - NYTimes.com
SANTA CLARITA, Calif. - A private company in Maryland has taken over public libraries in ailing cities in California, Oregon, Tennessee and Texas, growing into the country's fifth-largest library system.
Now the company, Library Systems & Services, has been hired for the first time to run a system in a relatively healthy city, setting off an intense and often acrimonious debate about the role of outsourcing in a ravaged economy.
A $4 million deal to run the three libraries here is a chance for the company to demonstrate that a dose of private management can be good for communities, whatever their financial situation. But in an era when outsourcing is most often an act of budget desperation - with janitors, police forces and even entire city halls farmed out in one town or another - the contract in Santa Clarita has touched a deep nerve and begun a round of second-guessing.

Mistakes widespread on foreclosures, lawyers say
By Stephanie Armour, USA TODAY
Paperwork mistakes that led one of the nation's largest mortgage servicers to halt foreclosure evictions in 23 states last week have happened elsewhere and affect tens of thousands of foreclosures, say lawyers for homeowners.
Ally Financial's GMAC Mortgage (GJM) acted after manager Jeffrey Stephan gave a statement to opposing lawyers that he had signed off on legal documents for 10,000 foreclosure papers a month without following verification procedures. Those lawyers say they've obtained similar statements from employees at JPMorgan Chase (JPM) and OneWest Bank - formerly IndyMac Federal Bank - that court papers weren't properly verified before being filed.

CoreLogic: Foreclosure rate up a smidge
PHOENIX BUSINESS JOURNAL
Foreclosure rates in the Phoenix area increased slightly in July over the same period last year, according to research from CoreLogic.
The local rate of foreclosures among outstanding mortgage loans was 4.44 percent for the month of July, an increase of 0.11 percentage points compared to July of 2009, when the rate was 4.33 percent.
Foreclosure activity in the Phoenix-Mesa-Glendale area was much higher than the national rate of 3.13 percent.

Case Shiller: Phoenix home values down 0.6%
PHOENIX BUSINESS JOURNAL - BY Jan Buchholz
Home prices declined slightly in the Phoenix market, according to data released today in the S&P/Case Shiller Home Price Indices.
The negative change from June to July, however, is small at 0.6 percent. And on an annual basis from July 2009 to July 2010 home prices in Phoenix increased 3.4 percent. Twelve of the 20 major metropolitan areas surveyed registered increased prices year-over-year.
The strongest annual growth in home prices occurred in three California cities with San Francisco posting a 11.2 percent increase, Los Angeles posting a 9.3 percent increase and San Diego a 7.5 increase.

Census Finds Record Gap Between US Rich and Poor
By: Associated Press - CNBC.com
The income gap between the richest and poorest Americans grew last year to its widest amount on record as young adults and children in particular struggled to stay afloat in the recession.
The top-earning 20 percent of Americans - those making more than $100,000 each year - received 49.4 percent of all income generated in the U.S., compared with the 3.4 percent earned by those below the poverty line, according to newly released census figures.
That ratio of 14.5 was an increase from 13.6 in 2008 and nearly double a low of 7.69 in 1968.

Thousands of jobless in N.C. told they owe money to the state
BY DAVID BRACKEN - STAFF WRITER NewsObserver.com
Thousands of long-term unemployed North Carolinians could soon owe the state money because the Employment Security Commission improperly made about $28 million in payments over the last two years.
Last week, the ESC began sending out letters to about 38,000 people who it has determined were either overpaid or underpaid through no fault of their own.
Recipients, all of whom received unemployment benefits for a year or longer, are getting anywhere from one to six letters depending on the number of times their benefits have been extended.

Answers to 7 pressing health-care questions
New rules coming as first changes from health reform kick in
By Kristen Gerencher, MarketWatch
SAN FRANCISCO (MarketWatch) - Parents who want to add their adult children to their health plans and people concerned they'll burn through low annual limits on their health benefits if they get sick are about to get some relief as the health-reform provisions kick in.
Many of the changes are meant as a bridge until 2014, when for the first time health plans will be available, with subsidies for those who can't afford it, in a new insurance marketplace; most individuals will have to have coverage or face a financial penalty; and insurers won't be able to reject applicants who already have health conditions.

Healthcare Reform: A Huge Misdiagnosis
Ron Paul - InfoWars.com
This week marked six months since Congress passed the healthcare reform bill in what has become all-too-typical legislative chicanery. Those in power crafted a mammoth piece of legislation and rammed it through Congress under a dire sense of emergency. Insisting on time enough to read the bill was dismissed as dangerous and crazy in a time of crisis. We were told that if we really wanted to see what was in the bill, we would have to pass it first. I cannot imagine the founding fathers intended for Congress to legislate in this manner. I would think if a Member is not absolutely certain the entire legislation meets Constitutional muster, the default vote should be "no" in accordance with our oath of office.

Ford May Shutter 200 Lincoln Dealerships
By DAVID SCHEPP - DailyFinance.com
In a bid to better compete against European and Japanese luxury makes, Ford Motor (F) reportedly may seek to reduce the number of Lincoln dealerships in the U.S.
Nearly 1,200 dealers sell Lincoln models, five times more than sell Toyota Motor's (TM) Lexus nameplate, the nation's leading luxury brand. Though most outlets that sell Lincoln also sell Ford, 264 dealers sell only the Lincoln and Mercury nameplates.
With the Dearborn, Mich., automaker eliminating the Mercury brand by year's end, that will leave those dealers only Lincolns to sell. For many of those dealerships, that would be unsustainable, since Mercury accounts for as much as 60% of their sales. Ford said in June it would shutter Mercury after 70 years to reduce the number of duplicative models and devote more resources to the Ford and Lincoln brands.

Apple Patent Shows Future of Biometrics Isn't Security
By Tim Carmody - Wired
recent Apple patent and a strongly worded report from the National Research Council suggest that the future of biometrics lies with personalization, not security.
The U.S. Patent and Trademark Office last week granted Apple a patent for biometric-sensor handheld devices that recognize a user by the image of his or her hand. In the not-too-distant future, anyone in the house could pick up an iOS device - or a remote control or camera - and have personalized settings queued up just for them.
The patent (which Apple first applied for in 2005) protects handheld devices with one or more "touch sensors" - buttons, touchscreens or other interfaces - on any of the device's surfaces. These sensors can take a pixelized image of a user's hand, match it to a corresponding image on file, and configure the device's software and user profile accordingly.

U N SEEKS CONTROL OF PLANETS DRINKING WATER
By Jim Kouri - NewsWithViews.com
This past week was a busy one in New York City's United Nations building. Besides the speeches by Iran's president and the U.S. president, there were meetings and conferences regarding the future of planet earth. While all eyes were on the speeches and pomp and circumstance of world leaders, the denizens of U.S. newsrooms ignored what one observer termed "The Mother of All Power Grabs."
The United Nations General Assembly is considering a historic resolution recognizing the human right to "safe and clean drinking water and sanitation" initiated by the Bolivian government. Other UN members have been consulted on the resolution and the final text is expected to be presented to the President of the General Assembly.

Don't award dissident with Nobel, Beijing warns
Says it could harm Norway-China ties
By Tini Tran - Associated Press
BEIJING | China has warned the Nobel committee against awarding its coveted peace prize to a jailed Chinese dissident, the head of the Norwegian Nobel Institute said Tuesday.
A Foreign Ministry spokeswoman denied that China has exerted pressure but said choosing dissident Liu Xiaobo would go against the prize's aims.
"The person you just mentioned was sentenced to jail by Chinese judicial authorities for violating Chinese law. I think his acts are completely contrary to the aspirations of the Nobel Peace Prize," said spokeswoman Jiang Yu.

'Credible But Not Specific' Threat of New Terrorist Attack
Officials in Europe, US on High Alert for Commando-Style Raids After Capture of Suspected German Terrorist
By RICHARD ESPOSITO, RHONDA SCHWARTZ, MATTHEW COLE and ANNA SCHECTER - ABCNews.com
US and European officials said Tuesday they have detected a plot to carry out a major, coordinated series of commando-style terror attacks in Britain, France, Germany and possibly the United States.
A senior US official said that while there is a "credible" threat, no specific time or place is known. President Obama has been briefed about the threat, say senior US officials.
Intelligence and law enforcement authorities in the US and Europe said the threat information is based on the interrogation of a suspected German terrorist allegedly captured on his way to Europe in late summer and now being held at Bagram Airfield in Afghanistan.

Multi-Attack Terror Plot On European Cities
Alex Watts, Sky News Online
Intelligence agencies have intercepted a terror plot to launch Mumbai-style attacks on Britain and other European countries, according to Sky News sources.
Sky's foreign affairs editor Tim Marshall said militants based in Pakistan were planning simultaneous strikes on London and major cities in France and Germany.
He said the plan was in the advanced but not imminent stage and the plotters had been tracked by spy agencies "for some time".
Intelligence sources told Sky the planned attacks would have been similar to the commando-style raids carried out in Mumbai.

Big Doin's in Juarez
by Fred Reed - LewRockwell.com
Things change. They change. I arrived in Mexico some seven years ago amid dire warnings from all and sundry that I would instantly die of foul disease, trampling by burros, and splashing sanguinary crime. All of this I regarded as nonsense, because it was. The State Department issued travel warnings and similar alarums, but State would regard Massachusetts as hazardous. There was little to fear. Expats traveled at will and walked the streets without concern.
Things change. While crime is hardly epidemic where we live, and in most places mostly involves narcos killing narcos, and takes place mostly away from the agringada regions rife with Americans, these days there is more of it. Before, you could walk home from a watering hole after midnight without worry. Now, no. There's not a lot of worry, but more than before.

UN 'to appoint space ambassador to greet alien visitors'
A space ambassador could be appointed by the United Nations to act as the first point of contact for aliens trying to communicate with Earth. - By Heidi Blake - Telegraph.co.uk
Mazlan Othman, a Malaysian astrophysicist, is set to be tasked with co-ordinating humanity's response if and when extraterrestrials make contact.
Aliens who landed on earth and asked: "Take me to your leader" would be directed to Mrs Othman.
She will set out the details of her proposed new role at a Royal Society conference in Buckinghamshire next week.
The 58-year-old is expected to tell delegates that the proposal has been prompted by the recent discovery of hundreds of planets orbiting other starts, which is thought to make the discovery of extraterrestrial life more probable than ever before.

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Tuesday 09.28.2010

It Is A Race To The Bottom For Global Currencies And The Winner Will Be Gold
The Economic Collapse
In 2010, any nation that has a weak currency has a very significant competitive advantage in global trade. A weak currency means that the products and services produced by that nation will be less expensive for other nations. Therefore other nations will buy more of those products and services. When exports go up, employment goes up and more wealth flows into the country. Alternatively, when the value of a national currency declines, exports do down, unemployment increases and less wealth flows into the country. Therefore, dozens of exporting nations around the globe have become increasingly determined to keep their national currencies very weak in an attempt to maintain a competitive advantage in the global marketplace. Essentially what we have is a race to the bottom among global currencies. Whenever any nation wants to gain a little bit more of an edge in global trade they push the value of their currency down just a little bit more. So who is the winner in all of this? Well, that is easy. Gold, silver and other precious metals will continue to be the winners as fiat currencies all over the globe continue to decline in value.

The (Unofficial) Beginning of the Double Dip Recession
By Addison Wiggin
09/27/10 Baltimore, Maryland -
Today, we take a belated bow for calling the "official" end of the recession ... by declaring a "double dip" to be unofficially under way.
Last week, the National Bureau of Economic Research (NBER) declared the Great Recession ended in June 2009. Turns out, looking back, we called it in real-time - relying on a single obscure indicator.
It's called "capacity utilization" - that is, all the plant, equipment and other resources business have at their disposal, and what percentage of it businesses are actually putting to work.
On June 17, 2009, we pointed out that "over the last 40 years, a bottom in capacity utilization has marked the precise end of recessions."

A Candid Appraisal of the Recovery
By: John Browne - GoldSeek.com
Over the last two weeks, seemingly good economic news offered some shreds of optimism to a stock market that was desperate for a pick-me-up.
The week before last, the National Bureau of Economic Research declared that the US recession had ended back in June 2009. At the beginning of last week, news came in that month-on-month retail sales had risen by 0.4 percent. Combined with successful government debt auctions in the eurozone, increasing expectations that Republicans will take back the House (thereby blunting the leftward drift of Washington), and hopes that a new round of quantitative easing will pump up growth, mainstream analysts are developing a feeling of near-euphoria.

How Hyperinflation Really Happens
By: Steve Saville, GoldSeek.com
.... Except for the part about hyperinflation encompassing a loss of faith in the currency, the above is almost completely wrong. In particular, economies don't "overheat", economic growth causes prices to fall rather than rise, and hyperinflation is very much an extension of inflation. The author of the article doesn't even mention money-supply growth. Trying to explain inflation or hyperinflation without reference to growth in the money supply is like trying to explain why the moon orbits the Earth without reference to gravity.
All historical episodes of hyperinflation that we know of -- and we know of many -- have been step-by-step processes set in motion by, and sustained by, increases in the supply of money. After the supply of money grows at a rapid rate for a period of at least a few years, some people conclude that the inflation will be endless. These people act today in anticipation of tomorrow's money-supply-induced price rises. As time goes by, more and more people come to the realisation that the inflation will most likely be endless and begin to act (meaning: buy stuff immediately) in anticipation of future price rises, which eventually leads to the situation where prices are rising much faster than the supply of money.

One once ounce of gold: one year's wage,
One ounce of silver: one month's wage
by Vincent Bressler - GoldSeek.com
You think I am crazy?
I have been ridiculed, dismissed, hated and now I am feared, but no one has given me a reason to change my view. I am still listening.
Unbacked paper money is fraud. Most of the wealth is the world is an illusion.
Real wealth is productive capacity. The world has orders of magnitude more productive capacity than in 1929, multiples of what it had in 1989. But the paper illusions of wealth dwarf real wealth as never before. Most of that paper wealth will accrue to gold and silver.
We will continue to see deflation in terms of gold and silver, inflation in terms of paper.
From the perspective of gold, debt will default. From the perspective of paper, debt will inflate.
One way or another, debt, which is the mirror reflection of the paper wealth illusion, will be destroyed.

How Realistic Is $5,000 Gold?
By: Chris Mack - GoldSeek.com
Taking into account 11 key measurements based on historical movements and price ratios, gold is likely to exceed $5,000 and silver is likely to exceed $200 within the next 5 years. If silver reverts to its historical ratio of 16 to 1 with gold, then it could rise even higher. Let me explain.
In recent weeks gold and silver have broken through their multi-month consolidation levels, and investors are wondering where the precious metals are headed. On a short term basis both gold and silver are overbought and due for a correction that may retest the breakout levels of $1,250 on gold and $20 on silver.

Gold firmer, hovering near all-time highs
By Jim Wyckoff of Kitco News
Comex gold futures prices are trading modestly higher Monday morning. Prices are hovering near Friday's all-time high of $1,301.30, basis the most active December futures contract. A weaker U.S. dollar is still producing fresh buying interest in the gold market. December Comex gold last traded up $2.80 an ounce at $1,300.90. Spot gold was last quoted up $2.50 at $1,300.00.
The U.S. dollar index hit a fresh eight-month low Monday morning. The dollar index remains weak, technically. The inverse price relationship between the U.S. dollar index and gold appears to have strengthened recently. As long as the U.S. dollar index is in an overall price downtrend on the charts, look for gold prices to continue to trend sideways to higher.

Central banks sell the least gold since 1999
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Major central banks and the International Monetary Fund over the past 12 months have reportedly sold the smallest amount of gold since an agreement to cap gold sales was put in place in 1999.
The first year under the current agreement ended Sunday, and the low level of sales comes as Europe continues to reel from the sovereign-debt crisis that threatened to halt the global recovery.
The agreement is in the midst of its third five-year run.
Central banks account for about 20% of above-ground gold in the world, and fewer sales mean gold supplies are likely to continue to lag demand, boosting prices.

Marc Faber Interview on Chinese Yuan, Gold Prices

Gold a Bubble? NOT - EVEN - CLOSE
By Jonathan Kosares - GoldSeek.com
With the number of financial bubbles inflating and bursting over the past decade and a half, it isn't surprising that financial analysts have their "bubble-dar" honed and active. What is surprising though is the large number who have resoundingly dubbed the gold market as "the next big bubble." But is it? Most gold owners reject claims that gold is in a bubble, but they might not be sure exactly why. The most concrete and convincing evidence against gold being in a bubble, though, is right in front of us.

Gold continues growth momentum in Asia
SINGAPORE (Commodity Online): Gold prices continued upward trends in early Asian trade Monday after breaking the psychological barrier of $1300 an ounce mark last week.
Gold for immediate delivery was seen trading at $1296.41 an ounce at 12.00 noon Singapore time while U.S. gold futures for December delivery was hardly changed at $1,297.8 an ounce on the Comex division of Nymex.
Analysts said the precious yellow metal is likely to advance further towards that glittering mark as worries about the health of the global economy spurred buying from investors.

Return of Quantitative Easing Good for Gold
By Frank Holmes - 321gold.com
The Federal Reserve said two words in its statement this past week that should make every gold investor happy: Quantitative Easing. The Fed hinted that we may see additional QE measures as early as November. The news is good for gold investors because it means there could be more dollars chasing a finite amount of resources, further devaluing the U.S. dollar.
We've already seen an intervention by Japan's central bank to weaken the yen in an effort to boost the nation's sagging export sector. Japan is currently the world's third-largest economy.

When Zombies Buy Gold
By Bill Bonner
09/27/10 Baltimore, Maryland - Last week it looked like the feds' efforts to reflate the US economy might be working. Gold was hitting one new high after another. Stocks were going up too.
The Dow rose nearly 200 points on Friday. Gold hit $1,300 ... but couldn't close at that level. When trading came to an end gold was $2 short of the $1,300 mark.
What's up? It's hard to know. If gold is going up, analysts reasoned, it must mean something. What? The obvious explanation is that inflation is coming.
So the advisors told their clients to buy gold. The economy must be improving they said. The recession ended more than a year ago. The recovery hasn't been as strong as anyone wanted. But there must be a recovery underway ... and it must mean that inflation and gold will go up.

6 Reasons Why a Dollar Crisis Is Imminent
Perry D. - SeekingAlpha.com
The U.S. dollar is sliding dangerously close to a steep cliff -- a possible point of no return at which the currency could collapse and America could join the ranks of the world's banana republics.
For more than thirty years, the U.S. has resisted the restructuring, austerity and market forces required to restore the health, competitiveness and potential of its economy.
Extending a long-running policy of neglect, denial, short-sightedness, political expediency and corruption, for the past two years, the Federal Reserve has tried to prop up the increasingly uncompetitive and defective U.S. economy with what amounts to unprecedented amounts of money printing -- still in effect and slated to expand. The government as a whole has increasingly spent beyond its means, doubled down on debt and pushed the limits of inflation risks as it milks the outdated perception of the dollar as a "safe haven" for all it's worth.

Dollar pares gains against euro
Fears about Fed activity overshadow Anglo Irish Bank rating cut
By Deborah Levine and William L. Watts, MarketWatch
NEW YORK (MarketWatch) - The dollar pared gains against the euro Monday, as lingering concerns that the U.S. Federal Reserve will engage in quantitative easing overshadowed a downgrade of troubled Irish lender Anglo Irish Bank.
The euro rose above $1.35 briefly, compared with $1.3486 in North American trade late Friday. It recently traded at $1.3487, after falling to $1.3424 earlier.

Brazil in 'currency war' alert
By Jonathan Wheatley in S‹o Paulo and Peter Garnham in London - FT.com
An "international currency war" has broken out, according to Guido Mantega, Brazil's finance minister, as governments around the globe compete to lower their exchange rates to boost competitiveness.
Mr Mantega's comments in S‹o Paulo on Monday follow a series of recent interventions by central banks, in Japan, South Korea and Taiwan in an effort to make their currencies cheaper. China, an export powerhouse, has continued to suppress the value of the renminbi, in spite of pressure from the US to allow it to rise, while officials from countries ranging from Singapore to Colombia have issued warnings over the strength of their currencies.

US closer to renminbi riposte
By James Politi in Washington - FT.com
The US Congress moved closer to punishing China for allegedly manipulating its currency, as a key committee of the House of Representatives voted to advance legislation that could heighten economic tensions between Washington and Beijing.
The Ways and Means Committee, which has jurisdiction over trade, approved the currency bill on Friday with bipartisan support, paving the way for a vote in the full House next week.
The legislation would allow the US to use estimates of currency undervaluation to calculate countervailing duties on imports from China and other countries. The language of the bill was recently changed to reduce its chances of being successfully challenged at the World Trade Organisation, making it more palat?able to centrist Democrats and some Republicans, even though there are still concerns that it may not pass muster with global trade rules.

Jim Rogers - 'You cannot spend money you don't have'

20 Signs That The Economic Collapse Has Already Begun For One Out Of Every Seven Americans
The Economic Collapse
For most Americans, the economic collapse is something that is happening to someone else. Most of us have become so isolated from each other and so self-involved that unless something is directly affecting us or a close family member than we really don't feel it. But even though most of us enjoy a much closer relationship with our television sets than we do with our neighbors at this point, it is quickly becoming undeniable that a fundamental shift is taking place in society. Perhaps you noticed it when two or three foreclosure signs went up on your street. Or perhaps it got your attention when that nice fellow down the street lost his job, and he and his family seemingly just disappeared from the neighborhood one day. The Census Bureau made front page headlines all over the nation this week when they announced that one out of every seven Americans was living in poverty in 2009. Every single day more Americans are getting sucked out of the middle class and into soul-crushing poverty.
Unfortunately, most Americans don't really care because it has not affected them yet.
But this year, millions more Americans will discover that the music has stopped playing and they are left without a seat at the table.

The Cost of Fed Incompetence
By The Mogambo Guru
09/27/10 Tampa, Florida - I have grown old yelling at my neighbors and family members to buy gold, silver and oil, to little-to-no avail, and I can see that they are getting bored with my same old million reasons why they should, and how their deliberate inaction only proves their stupidity, which I never tire of pointing out, so they can't say that they "didn't know" that they were stupid.
So, recently, I was standing in the street outside of Griswald's house, telling Old Man Griswald how he was an idiot for not buying gold, silver and oil as the only rational defense against the inflationary horror unleashed when his own stupid government (that he and his loathsome Leftist friends elected over and over again) was deficit-spending so unbelievably much money, dutifully created by the foul Federal Reserve, which is a complete failure as an institution if ever there was one, having destroyed 98% of the buying power of the US dollar since the Fed's inception in 1913 by creating too much money and credit, when their original purpose was to "keep prices stable," to which I cynically laugh in Sneering Mogambo Rebuke (SMR) "Hahahaha!"

***** FYI *****

IRS to stop mailing income tax forms
By Ed O'Keefe - Washington Post Staff Writer
The Internal Revenue Service plans to stop mailing instructions and paper forms for annual income tax returns, saving the agency about $10 million a year as more Americans are filing online.
About 11.5 million people who filed paper tax returns in 2009 received the tax information in the mail, IRS said. The agency normally sends the information at the beginning of the calendar year. The mailing includes the Form 1040 and instructions that totaled 44 pages last year.
More than 96 million individuals have filed their tax returns this year via IRS e-File (up about 6 million from 2008) and an estimated 20 million paper returns were filed through paid tax preparers, according to the agency.

Securities Ruling Limits Claims of Fraud
By NATHAN KOPPEL And ASHBY JONES - WSJ.com (free)
The U.S. Supreme Court has given multinational companies a powerful new legal defense against fraud claims made by some of their investors.
The weapon for companies grows out of a June ruling that limits fraud claims in U.S. courts by private investors who bought shares on foreign stock exchanges.
The Supreme Court decided Australian shareholders who had purchased stock overseas in an Australian bank couldn't bring securities-fraud claims in a U.S. court. In order to avoid "incompatibility with the applicable laws of other countries," U.S. securities laws should govern only domestic stock purchases, the court concluded.

Insider Selling To Buying Surpasses 1,400-1
by Tyler Durden - ZeroHedge.com
For all those who thought last week's "dramatic" improvement in the ratio of insider selling to buying from 650:1 to "just" 290:1 was a sign things are turning and insiders may soon be selling only 100 or so times more stock per week than buying, we have some bad news. According to Bloomberg, the latest ratio of insider selling to buying was 1,411 to 1. Let us repeat: 1,411 to 1. Needless to say, corporate insiders are totally buying the Fed reflation story, and the economic recovery. Like, totally.

Scientists, Secrets and Wall Street's Lost $4 Trillion
Pam Martens - SilverBearCafe.com
Thanks to an ever growing influx of Ph.D.s from the Ivies and an insatiable demand for an algorithmic trading edge by secretive hedge funds and proprietary trading desks at the largest firms, Wall Street has become part physics lab, part casino, part black hole.
What Wall Street bears no relationship to any longer is its primary mission in the U.S. economy: to be a fair and efficient allocator of capital to worthy businesses and innovators to propel job growth while also providing a medium for allowing investors to buy or sell stocks and bonds of those businesses at a fair price.

New FDIC rules require banks to share some risk
By Marcy Gordon - AP via WashingtonTimes.com
WASHINGTON (AP) - Federal regulators are insisting that banks share some risk when issuing the type of asset-backed securities that nearly toppled the financial system two years ago.
The Federal Deposit Insurance Corp. is requiring banks hold at least 5 percent of the securities on their books, as part of new rules the regulator adopted Monday that were required under the new financial overhaul law. Banks would be required to purchase their share of the securities beginning Jan. 1.

Default Is In Our Stars
Not in ourselves.
Paul Krugman - NYTimes.com
I think it's fair to say that a majority of economists believe that excessive private debt played a key role in getting us into this economic mess, and is playing a key role in preventing us from getting out. So, how does it end?
A naive view says that what we need is a return to virtue: everyone needs to save more, pay down debt, and restore healthy balance sheets.
The problem with this view is the fallacy of composition: when everyone tries to pay down debt at the same time, the result is a depressed economy and falling inflation, which cause the ratio of debt to income to rise if anything. That is, we're living in a world in which the twin paradoxes of thrift and deleveraging hold, and hence in which individual virtue ends up being collective vice.

Gerald Celente On The Collector's Coach Show!

What's Pushing China to Become More Assertive
By VISHESH KUMAR - DailyFinance.com
China's rapid economic expansion has been marked with a rise in stature on the world stage as well. But so far, the country that displaced Japan as the world's second-largest economy this year has been careful not to throw its weight around.
However, with its economy growing at faster than 10% a year even as much of the developed world struggles, tensions are mounting. And Beijing now seems to be taking a far more assertive tack, a development that could be crucial for markets as approaching congressional elections in the U.S. set the stage for more confrontation around currency revaluations.

China-Russia energy deals mark 'new era'
(China Daily)
Sino-Russian partnership cemented as leaders pursue common interests
BEIJING - China and Russia signed more than a dozen agreements on Monday to boost energy cooperation as leaders of the two countries hailed a deepening strategic partnership.
President Hu Jintao and Russian President Dmitry Medvedev witnessed the signing of 15 commercial deals as well as one on fighting terrorism, separatism and extremism.
One of the key deals was signed by China National Petroleum Corporation (CNPC) and Russia's Transneft over the operation of the oil pipeline that stretches from Skovorodino in eastern Siberia to Daqing in Northeast China.
The Russian section of the pipeline was completed last month, and the two leaders attended the completion ceremony of the Chinese section after their meeting on Monday.

The China Chicken Trade Wars
247WallSt.com
The Chinese Ministry of Commerce plans to put a levy on broiler chicken parts sent to the most populous nation in the world by American poultry farmers. The tariffs could be as high as 105.4%. "The final ruling is that the there is a causal relationship between the U.S. dumping of broiler products and the losses suffered by the Chinese industry,"the Ministry said
The program will hurt some US chicken producers, and it is a wonder that they did not agree to the demands of the People's Republic to set prices more fairly.
The fight over chickens is only one salvo in a barrage between the US and China over whether goods are dumped in each others markets. Underlying these disputes are rising tensions over the value of the yuan. The House Ways and Means Committee has approved legislation that would punish China if it does not reset its currency-or rather would force the Commerce Department to do so. Whether the entire House will approve a bill is not certain. The President might also veto it.

Will the Export Economy Spark a Global Currency War?
By CHARLES WALLACE - DailyFinance.com
In a fragile economy, every country wants to expand its exports, and low currency values can help make products cheaper to international buyers. Could countries' efforts to stay competitive be sparking a currency war?
Some signs of conflict have already popped up. For example, the U.S. is pushing China to allow the yuan to rise, with Congress scheduled to consider a measure that could lead to retaliation this week. Earlier this month, the Japanese government sold yen to lower that currency's value, drawing some international criticism.

Emerging nations to outgrow rich ones by 2015, World Bank says
By Sandrine Rastello (c) 2010 Bloomberg News
Sept. 27 (Bloomberg) -- Emerging nations will account for a bigger portion of the global economy than developed countries by 2015, as middle-class populations from southeast Asia to Latin America expand while public and private investment grows, according to a World Bank report.
"Developing countries have come to the global economy's rescue," Otaviano Canuto, World Bank vice president for poverty reduction and economic management, said in an e-mailed statement. "They are the new locomotives of growth which will move global growth forward while high-income countries remain stagnant."

Durable Goods Fall, But Business Spending is Up
By Chris Gaffney
09/27/10 St. Louis, Missouri - As Chuck informed all of you on Friday, I have got the conn on the Pfennig today and tomorrow as he was called down to Jacksonville for a few meetings. As always, Chuck left me with a few tidbits to get me going, so I'll kick off today's missive with Chuck's view of the markets:
On Friday, the US data printed much softer than expected, and for the first time in a long time, bad data results did not mean a dollar rally! Instead, fundamentals would have the dollar selling off from a Durable Goods Orders print that fell 1.3%, and New Home Sales that were flat ... And that's what happened!
The euro (EUR) added to its gains moving well into the 1.34 handle. And the Aussie dollar (AUD) is now within' spittin distance of 96-cents!

Bill Bonner on Deflation,
U.S. Treasury Bonds and the Trade of the Decade
By Kate Incontrera
09/26/10 Baltimore, Maryland -
Welcome to the DR Video Series. A few times a month, we will post interviews, video shorts and insights from today's top minds. As a Daily Reckoning reader, you'll have first crack at these exclusive videos - we'll let you know each time one is posted.
In the first part of this two-part interview, the Daily Reckoning's own Eric Fry sits down with Bill Bonner at the Agora Financial Investment Symposium in Vancouver to discuss a multitude of topics: what the speakers had to say at this year's event, Bill's thoughts on the credit deleveraging cycle, why he remains anti-Treasury ... and why his "Trade of the Decade" still looks like a great bet. Enjoy!

Bill Bonner on Deflation

Housing: Stuck and Staying Stuck
Inventories of Unsold Homes Are Swollen, but Anticipation of Further Price Declines Makes Buyers Scarce.
By NICK TIMIRAOS And SARA MURRAY - WSJ.com (free)
For months, home buyers and sellers have been stuck in a curious stalemate, with sellers reluctant to lower prices and buyers staying on the sidelines.
New data suggest the standoff eased slightly last month, as sales of existing, or previously owned, homes rose 7.6% from July's extremely low levels, according to figures released Thursday by the National Association of Realtors.
But while the housing market may have halted a slide that began in April after federal home-buyer tax credits expired, it still faces a long recovery, and buyers remain scarce. The August figures were the lowest for any month since 1997 except for July.

Blumenthal seeks foreclosure info from company
BY KEITH LORIA - LegalNewsline.com
HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General Richard Blumenthal announced on Monday that his office is looking into the actions of a mortgage company that allegedly filed defective foreclosure documents.
Blumenthal is demanding that GMAC/Ally Finance, Inc., which allegedly filed these defective foreclosure documents in Connecticut, freeze all foreclosures in the state.
"I am demanding a freeze in all GMAC/Ally foreclosure actions to forestall horrendous, illegal harm against homeowners," Blumenthal said.

New rules ban promises to cut your debt in half
By Blake Ellis
NEW YORK (CNNMoney.com) -- New rules muzzling debt-settlement companies go into effect Monday, preventing these firms from making grandiose promises they have no intention of keeping.
In the past, these for-profit telemarketing companies promised to renegotiate consumers' debt and even potentially cut it in half. They didn't warn customers, however, about the fees they would incur -- or that it could take years to see relief.
That all changes Monday. Federal Trade Commission rules now require these debt settlement companies to be more upfront and honest about their services. That means they must disclose how much money customers will fork over and how long the settlement process will take. And they're no longer allowed to swear to cut your debt in half if they can't.

$250,000 A Year Doesn't Translate Into Being 'Rich' Anymore
Elaine Meinel Sipkis - SilverBearCafe.com
The catastrophe which is overtaking the Japanese culture and society has also been slowly creeping up on the US. The insidious nature of this depressive, destructive social dynamic is rooted in a desire to ZIRP things down as much as humanly possible and thus, 'survive'. Those who have a hand on the true levers of power, that is, the importers and political powerful, thrive and increase their wealth and political power (note all the billionaires running our government) while encouraging the populace to believe that zero interest and zero growth is perfectly fine.

An Ode to Entrepreneurs: Middle-class? Long Gone!
J. Speer-Williams - PPJ Gazette
Like swans of legend, American entrepreneurs sing their final, beautiful song before they just fade away.
When everyone who is employed works for the state or federal government, we'll all likely be as impoverished as the citizens of the old Soviet Union. Remember the Soviets standing in long lines, with falling snow, to buy what they could from a dwindling short supply of consumer goods, goods they could barely afford, like two left boots, both of the wrong sizes?
Having too many people working for the government is the antithesis of prosperity. And it's estimated that for every "green" job the government creates, they'll eliminate 2.2 jobs from the real world of private enterprise, at a cost of about $700,000.00 a piece.

The Send Jobs Overseas Act
Ending the deferral of foreign income is another tax on U.S. employment. - WSJ.com - (free)
Democrats may be dodging a vote on the Bush-era tax cuts, but that doesn't mean they don't want to raise taxes before November. Witness this week's showdown in Congress over increasing the tax on the profits of American companies with foreign subsidiaries to punish firms that relocate plants overseas. How much more harm can this crowd do before it's run out of town?
Like so many others, this tax increase is being promoted by President Obama, who declared last week that "for years, our tax code has actually given billions of dollars in tax breaks that encourage companies to create jobs and profits in other countries. I want to change that."

People@Work: Plugging the Gap Between Jobs and Skills
By DAVID SCHEPP - DailyFinance.com
Despite the lingering recession and high unemployment, a vast number of employers worldwide are having difficulty finding workers they need to fill specific jobs. In the U.S., 52% of companies report problems attracting critical-skill employees, while nearly the same number say it's tough to find high-performing, talented workers, according to a recent survey by workplace consultancy Towers Watson and WorldatWork, a nonprofit research organization.
With some 15 million Americans unemployed, it's seemingly incomprehensible as to why companies can't find the talent they need. Part of the problem is that many laid-off workers simply lack the skills needed by employers, says Christopher Collins, professor of human resource management at Cornell University's ILR School.

19 Surprising Facts About the Deindustrialization of America
Michael T. Snyder - SeekingAlpha.com
The United States is rapidly becoming the very first "post-industrial" nation on the globe. All great economic empires eventually become fat and lazy and squander the great wealth that their forefathers have left them, but the pace at which America is accomplishing this is absolutely amazing.
It was America that was at the forefront of the industrial revolution. It was America that showed the world how to mass produce everything from automobiles, to televisions, to airplanes. It was the great American manufacturing base that crushed Germany and Japan in World War II.
But now we are witnessing the deindustrialization of America. Tens of thousands of factories have left the United States in the past decade alone. Millions upon millions of manufacturing jobs have been lost in the same time period. The United States has become a nation that consumes everything in sight and yet produces increasingly little.

Surprise! Blue collar jobs are coming back
By Chris Isidore
NEW YORK (CNNMoney.com) -- As the labor market continues to struggle, one surprising bright spot stands out amid the list of battered industries -- factory jobs.
Manufacturing employment began its decline long before the recession, losing jobs every year since 1998. But since the start of this year, there's been a 1.6% gain in manufacturing jobs -- about twice the pace of growth in other private sector jobs.
Even if manufacturing hiring stays flat the rest of this year, the industry is poised to post its biggest percentage gain in jobs since 1994.

Keiser Report No.80:

State eyes unclaimed cash as a quick fix
Mich. could take forgotten money in 3 years instead of up to 15
Ron French / The Detroit News
Lansing -- Michigan's budget problems would be even worse if state residents had better memories.
The state budget deficit is being balanced partly on a projected influx of $208 million from bank accounts, payroll checks and safety deposit boxes that have been misplaced or forgotten by their owners.
Under a deal struck between Gov. Jennifer Granholm and legislative leaders to erase $484 million in red ink, the time that businesses have to turn over forgotten property to the state would be reduced to three years. After that, the unclaimed money goes into the state's general fund. Previously, financial institutions had between five and 15 years to turn over the contents of dormant accounts or safety deposit boxes.

Connecticut and California join probe of Ally, order foreclosures freeze
By Ariana Eunjung Cha and Brady Dennis Washington Post
Attorneys general in Connecticut and California ordered Ally Financial's GMAC mortgage unit to freeze all foreclosures within their borders, joining a growing list of states investigating whether the firm and other lenders improperly kicked people out of their homes.
Connecticut Attorney General Richard Blumenthal on Monday accused Ally of using "defective foreclosure documents" in its filings and said he ordered the moratorium "to forestall horrendous, illegal harm against homeowners." California Attorney General Edmund G. Brown Jr. on Friday called Ally's document review process a "sham."

ObamaCare's Hotel California
WSJ.com (free)
The state moves to impose price controls you can never leave.
California, the novelist Wallace Stegner famously wrote, is like the rest of America, only more so - meaning that wherever the country is headed, the Golden State is probably there already. So the state's ObamaCare advance planning deserves closer scrutiny, given that it mirrors the regulatory and ideological model that the White House favors for everyone else.
In a matter of days, California will set a precedent for the future of the U.S. individual and small-business insurance markets via ObamaCare's "exchanges," where people will purchase coverage at heavily subsidized rates. The exchanges don't start up until 2014, but the states were given wide bureaucratic latitude in how they're run, and Sacramento is using this flexibility to convert them into a pretext for imposing de facto price controls on the insurance industry.

California eyes $5 billion bank loan
By Ben Rooney
NEW YORK (CNNMoney.com) -- California is in talks with Wall Street banks to secure up to $5 billion in short-term loans following an exceptionally long budget impasse.
Treasurer Bill Lockyer said Monday at a banking conference in New York that is working on a deal with Bank of America Merrill Lynch, JPMorgan Chase, Goldman Sachs and others.
But the final loan amount will not be known until California's legislature resolves a record-long budget impasse, according to Joe DeAnda, a spokesman for Lockyer.

Health Insurers Finally Get Some Oversight
In the past, these companies ran wild with no accountability
By KATHLEEN SEBELIUS - WSJ.com (free)
In the last two weeks, my department has been accused of "thuggery" (this editorial page) and "Soviet tyranny" (Newt Gingrich). What prompted these accusations? The fact that we told health-insurance companies that, as required by law, we will review large premium increases and identify those that are unreasonable.
There's a long history of special interests using similar attacks to oppose change. In the mid-1960s, for example, some claimed Medicare would put our country on the path to socialism.
But what is really objectionable about these comments is not who they're attacking, but what they're defending. These critics seem to believe that any oversight of the insurance industry is too much, and that consumers would be better off in a system where they have few rights or protections.

A Historical Perspective of the Social Security Nightmare
By Joel Bowman
09/27/10 Buenos Aires, Argentina - "The arrogance of officialdom should be tempered and controlled, and assistance to foreign hands should be curtailed, lest Rome fall."
- Marcus Tullius Cicero, 55 B.C.
What rhymes with Cicero? Not much. But if, as the saying goes, history itself rhymes, today's welfare-warfare state has plenty worth holding up against the soft, fading light of that long-fallen empire: Corrupt politiciansÉpredatory bankersÉruinous military misadventures to faraway landsÉa gluttonous citizenry feeding at the trough of public monies and, of course, the insidious, ridiculous illusion that any single participant could have made one jot of difference to the great charade as it unfolded before their very eyes.

Opt Out of Social Security
By Ian Mathias09/27/10 Baltimore, Maryland - "The Social Security Trust Fund is misnamed. It cannot be trusted, and it is not funded."
-Former US Comptroller General David Walker, July 2010.
If David Walker - who was essentially the US government's accountant from 1998-2008 - can make jokes like that about Social Security, we're in trouble. Indeed, as we noted in our essay "The End of Social Security as We Know It", the Social Security Trust recently began paying out more than it is taking in. Over the next 75 years, the Fund will require an additional $5.4 trillion to pay for scheduled benefits.
Given the deplorable fiscal condition of the Social Security Trust Fund, some forward-looking Americans are asking, "Why can't I just opt out?" Even middle-aged members of the Baby Boom generation are wondering if there will be any Social Security left for them when the time comes ... and if they wouldn't be better off abandoning the government's mandatory retirement plan.
So can you opt out? In a word, yes.

Let's Put Patients and Doctors Back in Control of Healthcare!

Movie Review of 'Wall Street: Money Never Sleeps'
By Jo Ann Skousen
09/27/10 Dobbs Ferry, New York - "Wall Street: Money Never Sleeps" (2010). Oliver Stone, director. 20th Century Fox, 133 minutes.
In some ways "Wall Street: Money Never Sleeps" (2010) feels more like a remake than a sequel of "Wall Street" (1987), the iconic film that focused on the inner workings of the financial markets and the scandals involving junk bonds and insider trading of the 1980s. The film earned Michael Douglas an Oscar for his portrayal of Gordon Gekko, the ruthless insider who takes down several companies before he is finally caught. His character's name has become so tied to Wall Street shenanigans that business schools reference him in their courses. Hedge fund manager Anthony Scaramucci called his investment memoir, "Goodbye Gordon Gekko" (2010), knowing that no one would have any trouble understanding the reference in the title. Similarly, libertarian reporter John Stossel borrowed Gekko's most famous line, "Greed'is good" for the title of one of his best known TV specials (1998).

'Wall Street: Money Never Sleeps'
Presents the Next Generation of Financial Sharks
By BRUCE WATSON - DailyFinance.com
Between 1974 and 2009, Oliver Stone directed seventeen films on subjects ranging from the Vietnam war to ancient Macedon, Jim Morrison to George W. Bush. But in all that time -- and all those films -- he never made a sequel. It seems likely that much of Stone's reluctance to step twice in the same river has to do with his themes: his films often capture and crystallize an historical moment, like the loss of national innocence in the Vietnam-based Platoon or the explosion of greed in 1987's Wall Street. Returning to the same well could easily veer into self-parody.
Then again, sometimes history repeats itself and -- for once -- Stone has followed suit. The director's eighteenth film and his first-ever sequel, Wall Street: Money Never Sleeps, opens today across the country. Bringing back Gordon Gekko, the seductive villain from the first Wall Street, Stone's latest morality tale once again shows the danger -- and irresistible attraction -- of outrageous amounts of money.

Democrats fear Midwestern meltdown
By MAGGIE HABERMAN - Politico.com
Two years after President Barack Obama swept the Midwest, Democratic fortunes in the region are sagging, with the GOP poised to make big gains by scooping up disaffected independent voters in a wide swath of states hit by job losses, budget woes and political scandal.
From Ohio to Iowa, there's a yawning stretch of
heartland states whose citizens voted for Obama and congressional Democrats in 2008, but who have lost patience waiting for an as-yet undelivered economic revival that was first promised in 2006, and then two years later. Now, they look set to stampede toward the out-of-power party.

S. 510:
12 Reasons Why The Food Safety Bill From Hel
Could Be Very Dangerous For The U.S. Economy
TheComingEconomicCollapseBlog.com
As you read this, there is a bill before the U.S. Senate that has the potential to change the U.S. food industry more than any other law ever passed by the U.S. Congress. In the name of "food safety", the U.S. government would be given an iron grip over the production, transportation and sale of all food in the United States. Hordes of small food producers and organic farmers could potentially be put out of business. If this bill becomes law, the freedom to grow what you want, eat what you want and to share food from your gardens with your neighbors could be greatly curtailed. It would give the FDA unprecedented discretion to regulate U.S. food production. A version of this bill was already passed by the U.S. House of Representatives last summer, and now S. 510, also know as the FDA Food Safety Modernization Act, is in front of the U.S. Senate and it is expected to pass easily.

Obama's Wars: Revolt of the Generals, Part 2
By Jed Babbin - The American Spectator.org
How has President Obama mismanaged the Afghanistan war? Bob Woodward's new book counts the ways. There's a president retreating after a "generals' revolt," domestic politics overriding any concern with the war's outcome and -- according to the leaked portions of the book due out today -- much more. But the White House is praising Obama's Wars, not condemning it.
If you are confused, dear reader, take comfort in the fact that you are no more so than our president.
Before we get to the revealing parts of Woodward's book, it's time to pull back on the stick and gain a little altitude. What Woodward's book reveals is a president whose sole concern -- regardless of the issue -- is how it will affect his domestic political position.

Hamas political leader vows to continue fight against Israelis
By the CNN Wire Staff
Damascus, Syria (CNN) -- The political leader of Hamas said in an interview Monday that the Islamist group will continue to fight what he called Israel's occupation of Palestinian territory, declaring the group's resistance "a legitimate and just cause, and therefore we will win no matter what."
Khaled Meshaal's comments on CNN International's "Prism" come amid a turning point in recently renewed peace talks between Israel and the Palestinians. New construction began at settlement sites in the disputed West Bank territory Monday, just hours after the expiration of a 10-month Israeli government moratorium on building.

North Korean leader's son apparently promoted to general
By the CNN Wire Staff
(CNN) -- North Korean leader Kim Jong Il's youngest son apparently was among more than 30 military promotions announced Monday by his father during celebrations of the Workers' Party of Korea's 65th anniversary, North Korea's state news agency reported.
Kim Jong Un has been widely rumored to be his ailing father's anointed successor.
Kim Jong Il's sister, Kim Kyong Hui, was apparently also promoted to general, according to the state-run KCNA news agency.
While it has been speculated that Kim Jong Un will succeed his father, details about him are scarce in North Korea and out.

China plays by its own currency rules
By Peter Lee - Asia Times Online
The past two years have been tough on China-oriented Western economists. China's archaic mercantilism, tight capital controls, over-regulated financial sector, managed exchange rate and, above all, its need to purchase and sterilize massive inflows of foreign exchange were, according the theorists, leading the country to economic calamity.
However, Western triumphalism in 2008 took a tumble as the West's most sophisticated financial innovators led the world economy off a cliff. Meanwhile, China's ham-fisted socialists saved China and, to a certain extent, the rest of the world with an enormous stimulus program (US$586 billion in domestic spending plus significantly relaxed limits on bank lending) that, as a ratio of the gross domestic products (GDP), dwarfed America's stimulus spending by a factor of more than five.

US stirs South China Sea waters
By Clifford McCoy - Asia Times Online
A cooperative announcement from the United States and Association of Southeast Asian Nations (ASEAN) on Friday included reference to navigation and maritime security, an issue of rising rancor between the US and China in the South China Sea. Southeast Asian nations welcomed the US's commitment, but Washington's growing involvement in the group's prickly territorial issues with China threatens to spark a new regional flash point.
The joint US-ASEAN statement came after a luncheon between US President Barack Obama and leaders of ASEAN member states on the sidelines of the United Nations' General Assembly meeting in New York. The meeting was co-chaired by Vietnamese president Nguyen Minh Triet, who currently serves as ASEAN's chairman, and marks the second time Obama has met with regional leaders since last November in Singapore.

***** Important! *****

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Monday 09.27.2010

Regulators seize 3 failing wholesale corporate credit unions
By Daniel Wagner, Associated Press
WASHINGTON - Federal regulators took over three key lenders to U.S. credit unions, after losses on mortgage investments threatened to topple them. The move was a reminder that parts of the financial system are still burdened by the toxic assets two years after the financial crisis peaked.
The National Credit Union Administration voted Friday to place into conservatorship three corporate credit unions: Members United Corporate Federal Credit Union of Warrenville, Ill; Southwest Corporate Federal Credit Union of Plano, Texas; and Constitution Corporate Federal Credit Union of Wallingford, Conn.

Credit Unions Bailed Out
U.S. Backs $30 Billion in Bonds to Stabilize Key Institutions;
Subprime Legacy
By MARK MAREMONT And VICTORIA MCGRANE - WSJ.com (free)
Two years after the peak of the financial crisis, the federal government swooped in to stabilize a crucial part of the credit-union sector battered by losses on subprime mortgages.
Regulators announced Friday a rescue and revamping of the nation's wholesale credit union system, underpinned by a federal guarantee valued at $30 billion or more. Wholesale credit unions don't deal with the general public but provide essential back-office services to thousands of other credit unions across the U.S. The majority of retail credit unions are sound, but they will have to shoulder the losses through special assessments over the next decade.

North County Bank, Arlington, Washington, becomes the 127th ailing bank on the FDIC hit list for 2010. The FDIC estimates that the cost to the Deposit Insurance Fund (DIF) will be $72.8 million.
North County Bank, Arlington, Washington, was closed today by the Washington Department of Financial Institutions, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with Whidbey Island Bank, Coupeville, Washington, to assume all of the deposits of North County Bank.

Haven Trust Bank Florida, Ponte Vedra Beach, FL
September 24, 2010 - 5:08 pm
The 126th FDIC-insured institution to croak in the nation this year, is also the 24th in Florida. Haven Trust Bank Florida, Ponte Vedra Beach, FL, was shuttered by the agency tonight at an estimated cost to the Deposit Insurance Fund (DIF) of $31.9 million.
Haven Trust Bank Florida, Ponte Vedra Beach, Florida, was closed today by the Florida Office of Financial Regulation, which appointed the Federal Deposit Insurance Corporation (FDIC) as receiver. To protect the depositors, the FDIC entered into a purchase and assumption agreement with First Southern Bank, Boca Raton, Florida, to assume all of the deposits of Haven Trust Bank Florida.

Bank of Granite is facing possible Nasdaq delisting
By RICHARD CRAVER, RICHARD CRAVER | Winston-Salem JOURNAL
For the second time in a year, Bank of Granite Corp. is facing a potential delisting from the Nasdaq Stock Market.
The bank, based in Granite Falls, has its mortgage operation and a branch on Jonestown Road in Winston-Salem.
The bank said yesterday that it received notice Wednesday from Nasdaq that because the bid price on its stock has been below $1 a share for 30 consecutive business days, it "no longer complies with the minimum bid price requirement for continued listing."

Trashing the dollar to save the economy
By Tom Petruno - Market Beat - LATimes.com
Most Americans have never traveled abroad. U.S. economic policy may guarantee that your dream trip remains deferred.
If something's got to be sacrificed to put the domestic economy on the road to a sustainable recovery, the dollar's value against other currencies seems a good candidate.
That's what the Federal Reserve signaled this week - and what Congress, in no uncertain terms, is telling the Chinese.
A new devaluation of the buck carries risks. Always high on any Wall Street list of potential calamities is the idea of a sudden collapse of the dollar. That still seems remote, though perhaps less so than in the past.

Gold is the final refuge against universal currency debasement
States accounting for two-thirds of the global economy are either holding down their exchange rates by direct intervention or steering currencies lower in an attempt to shift problems on to somebody else, each with their own plausible justification. Nothing like this has been seen since the 1930s.
By Ambrose Evans-Pritchard - Telegraph.co.uk
"We live in an amazing world. Everybody has big budget deficits and big easy money but somehow the world as a whole cannot fully employ itself," said former Fed chair Paul Volcker in Chris Whalen's new book Inflated: How Money and Debt Built the American Dream.
"It is a serious question. We are no longer talking about a single country having a big depression but the entire world."
The US and Britain are debasing coinage to alleviate the pain of debt-busts, and to revive their export industries: China is debasing to off-load its manufacturing overcapacity on to the rest of the world, though it has a trade surplus with the US of $20bn (£12.6bn) a month.

The global politics of gold
FinanceAndEconomics.com
Very little attention is given to the global political consequences of the strength of gold, but we can be sure that the strategy analysts in the Pentagon and elsewhere are acutely aware of the difficulties created between the old communist bloc on one side, and America, the UK and Europe on the other. If they are not, they are not doing their job at a time when they know Russia is running spy networks in the US, and possibly knows what is left in Fort Knox down to the bar. The ex-communists are playing from a position of increasing strength, and the West from weakness; but the issues are complex, requiring some deductive guess-work.

$1,300? Some say gold may hit $2,300!
By Paul R. La Monica
NEW YORK (CNNMoney.com) -- Gold finally traded above $1,300 an ounce Friday morning. So is that the peak or can the precious metal actually head even higher?
As tempting as it is to say that gold is an absurdly overvalued yellow bubble, several pretty savvy people say there are compelling reasons for gold to keep climbing.
Some investors are worried that the Federal Reserve's commitment to buying more Treasurys could mean higher inflation down the road. So far, inflation has not been a near-term problem. And the chart at the top of this page clearly shows that gold can go up without inflation pressures.

Gold's next hurdle is 1980's inflation-adjusted peak
By Claudia Assis, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold hit a long-anticipated high-water mark Friday, briefly breaking through $1,300 an ounce. But the precious metal still has a long way to go to reclaim its inflation-adjusted all-time highs.
A gold investor who bought an ounce of the metal at its January 1980 peak would need gold to advance by more than $1,000 an ounce from today's record levels to come out ahead when 30 years of inflation are taken into account.

The Hedge Funds are Buying Gold for a Reason
By: Ivory Johnson - CNBC.com
Many experts have called gold a bubble for the last five years, even as it outperformed the equities' market by almost 200 percent during the same time frame. Others, on the other hand, believe it is being manipulated for a quick profit at the expense of retail investors.
The truth is the United States Treasury must refinance 36 percent of the debt this year and 60 percent by 2013, and unlike Greece who can't print money to refinance their obligations, the United States Federal Reserve has no such restraints.

Sentiment remains positive towards gold, silver
By Debbie Carlson of Kitco News - Commodity Online
(Kitco News) - Gold and silver hit milestones this week, with gold breaching $1,300 an ounce and silver a 30-year high, investor sentiment remains positive toward to the precious metals.
Silver is outpacing gold and has for the week and so far for the month. Looking at the futures on the Comex division of the New York Mercantile Exchange, December silver is up 10.1% on the month and closed the week with a 2.8% rise, settling at $21.399. Gold, meanwhile, is up 3.8% this month and gained 1.6% this week, settling at $1,298.10.

Nothing can stop bullion bull
LONDON (Commodity Online): If you go through a Financial Times report on gold, you will be busy putting all your money in gold basket by now.
According to the leading business paper, gold is heading for more records and the prices can any time breach the psychological barrier of $1,300 per ounce next week.
Gold was trading at $1,296.85 on Friday in London. Before this gold had already set five new records in this week itself. According to Financial Times, the reasons for the latest bull run in bullion are fears that renewed monetary easing by the Federal Reserve could lead to sharp falls in the US dollar and, eventually, a jump in inflation have sent the gold price to a string of record highs this week.

IRAN: Gold bazaar on strike
as merchants square off with government over tax hike
LATimes.com
Tehran's main gold bazaar is usually glittering with precious baubles and jewelry fit for royalty, but the last several days have seen it shuttered and empty as the union of goldsmiths and jewelers strikes against a 3% value-added tax.
"We'll stay on strike until the negotiation gets results," Ali Mosavi, a goldsmith in the bazaar, told Babylon & Beyond. "This is the third year we are protesting and so far we have been able to resist [the tax hike]."
The strike appears to be affecting the retail and wholesale gold markets of Tehran's main bazaar as well as the markets of other Iranian cities like Esfahan, Mashhad and Tabriz, but not non-union jewelry stores outside the bazaars.

Oil Rises for Second Day as Dollar Slump Boosts Commodities
By Christian Schmollinger
Sept. 27 (Bloomberg) -- Oil rose for a second day in New York as the dollar dropped against the euro, bolstering the appeal of commodities as an alternative investment.
Crude extended its 1.7 percent gain on Sept. 24 after the euro strengthened against the greenback following a report showing German business confidence at a three-year high. The dollar also slumped as policy makers indicated they may lower interest rates. U.S. durable goods orders not including transportation items climbed more than expected.

Silver Jumps to 30-Year High; Gold Rises to Record, Tops $1,300
By Pham-Duy Nguyen and Nicholas Larkin - Business Week
Sept. 24 (Bloomberg) -- Silver climbed to the highest price since 1980 as the dollar's slump boosted demand for precious metals as alternative assets. Gold climbed to a record, topping $1,300 an ounce.
Silver has jumped 27 percent this year, and gold has gained 18 percent, outperforming global equities, Treasuries and most industrial metals. Today, the dollar fell to the lowest level since February against a basket of six major currencies as the Federal Reserve keeps borrowing costs low and moves closer to easing monetary policy to bolster the U.S. economy.

Silver prices on the verge of a major move to the upside
The long awaited break above the former key resistance level of $18.50 gave an extremely positive sign to silver bulls but, in the short-term, we may see some consolidation.
Author: David Levenstein - MineWeb.com
JOHANNESBURG -
Silver has been on fire in the last few weeks and the price has moved from $17.50 to a hair above $21/oz in six weeks. That is an increase of 20%! Not bad if you have been long, too bad if you have been short.
Last Monday, not only did the grey metal break the psychologically important $20 an ounce level, it remained above $20 for most of the week sending prices of this precious metal to a 30-month high. At the moment there is a lot of momentum in silver as investors snap up bullion bars, bullion coins while funds add silver to their positions, and it seems that there is still some steam left in this current move that may take prices above $21 before we see a pull-back.

Pushing on a String
By: John Mauldin - GoldSeek.com
Let's Shift the Focus
An Invitation to an Inflation Party
Ten Years and Counting
This week the Fed altered their end-of-meeting statement by just a few words, but those words have a lot of meaning. It seems they are paving the way to a new round of quantitative easing (QE2), if in their opinion the situation warrants it. A trillion dollars of new money could soon be injected into the system. Tonight we explore some of the implications of a new round of QE. Let's put our speculation hats on, gentle reader, as we are moving into uncharted territory. There are no maps, just theories, and they don't all agree.

A Red-Alert Threat to the Regime
by Gary North - LewRockwell.com
AUDIT THE GOLD
In 2011, Congressman Ron Paul will introduce a bill in the House of Representatives calling for an audit of the gold held by the Federal Reserve System on behalf of the United States government. If he can successfully promote this bill by the phrase, "Show us the gold!" he will inflict enormous damage on the American Establishment. This damage could conceivably spread to the entire international Establishment, which rests on the sovereignty of the central banks over their domestic governments.
Most of those few Americans who have ever heard of the Federal Reserve System operate under the illusion that the government is sovereign over the FED. On paper, this is true. Operationally, it isn't. We know this, because no government agency audits the FED.

Bernanke Says Financial Crisis Damage Inhibiting U.S. Recovery
By Craig Torres and Joshua Zumbrun
Sept. 25 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said damage from the financial crisis has left the U.S. economy growing at a slower pace than policy makers want even as the central bank's more than $1 trillion in bond purchases have reduced interest rates.
"By buying mortgage-backed securities and Treasuries we did, I think, additionally stimulate the economy," Bernanke said yesterday in response to a question after he spoke at a Princeton University conference.

Signs of accelerating economy not in sight
Upcoming data this week unlikely to boost confidence
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) - The U.S. recession evidently ended two summers ago, but the millions of Americans still out of work don't want to hear it.
Even though the latest data suggests the U.S. economy is expanding, growth is so slow it's barely noticeable. The nation's unemployment rate of 9.6% stands near a 27-year high and there's little evidence that the economy is gaining steam.
Data for the upcoming week, which includes reports on consumer confidence, manufacturing and personal income, are unlikely to alter the bigger picture. None of those indicators is expected to show sharp movement one way or the other.

Fed chief Ben Bernanke wants closer look at speculative buying
By Jeannine Aversa, Associated Press
WASHINGTON - Fed policymakers must better understand speculative buying in financial markets to help prevent another financial crisis, Federal Reserve Chairman Ben Bernanke said Friday.
Frenzied buying fed a housing bubble that burst, plunging the economy into a recession in 2007, the worst downturn since the 1930s. While many lessons were learned from the crisis, Bernanke, in prepared remarks, said additional research is needed to explain when and why bubbles start.

Why QE2 + QE Lite Mean The Fed Will Purchase Almost $3 Trillion In Treasurys And Set The Stage For The Monetary Endgame
by Tyler Durden - ZeroHedge.com
Recently the debate over when QE2 will occur has taken a back seat over the question of what the implications of the Fed's latest intervention in monetary policy will be, as it is now certain that Bernanke will attempt a fresh round of monetary stimulus to prevent the recent deceleration in the economy from transforming into outright deflation. Whether or not the Fed will decide to engage in QE2 on its November 3 meeting, or as others have suggested December 14, and maybe even as far out as January 25, the actual event is now a certainty. And while many have discussed this topic in big picture terms, most notably David Tepper, who on Friday stated that no matter what, stocks will benefit from QE2, few if any have actually considered what the impact of QE2 will be on the Fed's balance sheet, and how the change in composition in Fed assets will impact all marketable asset classes. We have conducted a rough analysis on how QE2 will reshape the Fed's balance sheet. We were stunned to realize that over the next 6 months the Fed may be the net buyer of nearly $3 trillion in Treasurys, an action which will likely set off a chain of events which could result in rates dropping all the way to zero, stocks surging, and gold (and other precious metals) going from current price levels to well in the 5 digit range.

The American Recovery and Reinvestment Act
Our Tax Dollars at Work
Martin Andelman
On Feb. 13, 2009, Congress passed the American Recovery and Reinvestment Act of 2009 (ARRA). President Obama signed it into law four days later as a direct response to the economic crisis. The ARRA had four immediate goals, according to the government's site:

1. Create new jobs.
2. Save existing jobs.
3. Spur economic activity and invest in long-term growth.
4. Foster unprecedented levels of accountability and transparency in government spending.

Good goals, I would have to say, all of them. So, how's it going? I mean, enquiring minds want to know, right? I would think so.

Treasury Said to Prepare AIG Exit, Repayment Plan for Unveiling
By Hugh Son and James Sterngold
Sept. 27 (Bloomberg) -- The U.S. Treasury Department may announce plans as early as this week to return American International Group Inc. to independence and recoup taxpayer money from the insurer's bailout, according to three people with knowledge of the talks.
The biggest part of that strategy is for Treasury to begin converting its $49 billion preferred stake into common stock for sales by the first half of next year, said the people, who declined to be identified because the negotiations are private. The timing of an announcement depends on the pace of talks between regulators and the New York-based insurer, and discussions may extend beyond this week, the people said.

Low Inflation Not Always Deflation Risk
By: Reuters via CNBC.com
Low U.S. inflation is not necessarily a deflation risk, a top Federal Reserve official said on Friday, according to Market News International.
Jeffrey Lacker said the United States could experience underlying inflation between 1 percent and 1.5 percent without running the risk of falling into the prices spiral that has plagued the Japanese economy for years, Market News said.

Dollar Trades Near 5-Month Low on Expectations Economy to Slow
By Yoshiaki Nohara
Sept. 27 (Bloomberg) -- The dollar traded near a five-month low versus the euro as expectations the economy will slow added to speculation the Federal Reserve will ease monetary policy.
The dollar was close to a one-week low against the yen before U.S. reports forecast to show the economic activity fell and consumer confidence dropped. The yen slid against higher- yielding counterparts after commodities and global stocks advanced, sapping demand for Japan's currency as a refuge.

THOSE WHO KNOW WILL UNDERSTAND
by JR Nyquist - FinancialSense.com
According to some experts the U.S. economy is one "event" away from a catastrophic sequence. My own variation on this sequence goes something like this: first, the dollar collapses; second, the government's response prevents any chance for recovery; third, political unrest and destabilization begins; last, the defensive function of the state fails as external and internal enemies take advantage of the country's weakness. This sequence would likely be nonsense if it were only my sequence. Unfortunately, it is a sequence dreamt up by Soviet strategists as far back as the 1960s. It was the entire basis of the Soviet strategic blueprint of half a century ago. The writings of at least two Soviet Bloc defectors suggest that this same blueprint dictated the controlled "collapse" of Communism in Eastern Europe from 1989-91. This would differ from the uncontrolled collapse of capitalism that Soviet strategists also anticipated.

PIIGS roast: Euro debt fears return
By Paul R. La Monica
Ireland's gross domestic product fell in the second quarter. Since Ireland is one of the I's in the so-called group of troubled PIIGS nations in Europe -- Portugal, Italy, Greece and Spain make up the rest of the club -- that is not good news.
The Ireland GDP report, which was released Thursday, wasn't the only bit of troubling data from Europe either. A key index of European purchasing manager activity by research firm Markit fell sharply from August to September and was lower than what economists were expecting.

Congress Ban on Rating Delays U.S. Implementing Basel
By Yalman Onaran
Sept. 24 (Bloomberg) -- A 24-line section of the 848-page Dodd-Frank Act is delaying U.S. implementation of international rules for how much capital banks need to hold against securitized assets.
The financial-overhaul legislation, signed by President Barack Obama in July, requires regulators to remove all references to credit ratings of securities from their rules. Revised standards on how much capital banks need to hold against such assets in their trading books, approved by the Basel Committee on Banking Supervision in 2009, rely on such ratings.

On the Secret Committee to Save the Euro, a Dangerous Divide
By MARCUS WALKER, CHARLES FORELLE and BRIAN BLACKSTONE
BRUSSELS - Two months after Lehman Brothers collapsed in the fall of 2008, a small group of European leaders set up a secret task force - one so secret that they dubbed it "the group that doesn't exist."
Its mission: Devise a plan to head off a default by a country in the 16-nation euro zone.
When Greece ran into trouble a year later, the conclave, whose existence has never before been reported, had yet to agree on a strategy. In a prelude to a cantankerous public debate that would later delay Europe's response to the euro-zone debt crisis until the eleventh hour, the task force struggled to surmount broad disagreement over whether and how the euro zone should rescue one of its own. It never found the answer.

Three reasons to cheer inflation
Posted by Nin-Hai Tseng, Fortune
The Fed says it's willing to do what it takes to boost the economy, even if that means encouraging inflation. Here's how that could do the trick.
Paying higher prices for everyday items might not be a welcome development to the millions of cash-strapped and jobless Americans. But as some economists have rightfully argued, a little inflation could actually help stimulate the economy at a time of very slow growth.
True, monetary policies encouraging higher prices aren't always a good thing. In fact, it often makes people feel poorer as the price of everything from cars to TVs rise. Higher inflation weakens the U.S. dollar, since a buck buys less as prices rise. Also, if you've been socking your money away in a bank account, inflation will reduce the value of those savings.

Obama's Stimulus Plan Made Crisis Worse, Taleb Says
By Frederic Tomesco
Sept. 25 (Bloomberg) -- U.S. President Barack Obama and his administration weakened the country's economy by seeking to foster growth instead of paying down the federal debt, said Nassim Nicholas Taleb, author of "The Black Swan."
"Obama did exactly the opposite of what should have been done," Taleb said yesterday in Montreal in a speech as part of Canada's Salon Speakers series. "He surrounded himself with people who exacerbated the problem. You have a person who has cancer and instead of removing the cancer, you give him tranquilizers. When you give tranquilizers to a cancer patient, they feel better but the cancer gets worse."

Senate Will Not Vote on Extending Bush Tax Cuts Before Election
By HUGH COLLINS - DailyFinance.com
The Senate will not vote on extending any of the Bush-era tax cuts until after the November election.
"Democrats believe we must permanently extend tax cuts for the middle-class before they expire at the end of the year, and we will," Jim Manley, a spokesman for Senate Majority Leader Harry Reid said in an e-mail, Reuters reported.

Right to Rent legislation aims to slow foreclosure rate
TheTruthAboutMortgage.com
New legislation that would allow struggling homeowners to rent their homes would slow the foreclosure rate, according to a report from the Center for Economic and Policy Research (CEPR).
"With roughly one-in four mortgages underwater, the loan modification plans put forth so far have done little to help homeowners facing foreclosure," said Dean Baker, Co-Director of CEPR and an author of the report, in a release.
"Right to Rent, on the other hand, would benefit millions, provide families with real housing security, and could go into effect immediately."
The report analyzed the costs of renting versus owning a home in a number of major metropolitan cities and found that it's often much lower than the cost of ownership.

Obama health care reform imposes 3.8% tax
on all income from home sales and home rental income
by Mike Adams, the Health Ranger
(NaturalNews) The news about Obama's health care reform just keeps getting worse -- and we only find these things long after the bill has passed, of course. The newest revelation concerns a 3.8% tax on income from home sales and home rentals which will go into effect in 2013. (Note: This story has been updated to clarify who the 3.8% tax impacts, see below.)
Depending on your income level, this could end up costing you thousands of dollars from the sale of a home (even if you're a middle-class income earner). It would also place a tax burden on all rental income from any home you might rent out to others.

Housing Market:
one more reason for Bernanke to fire up the printing press
Evaldo Albuquerque - WorldCurrencyWatch.com
This year I took advantage of the tax credit for first time home buyers. But it wasn't an easy decision to make. I was really concerned that prices could fall another 10 to 15%.
But the tax credit and the fact that I was looking for a place to live (and not just an investment) made me pull the trigger. But now that the tax credit has expired, my fears of a further decline in prices are becoming more and more real.
Housing demand plummeted in July after the tax credit expired. And there are so signs of recovery. There won't be anytime soon. High unemployment and looming foreclosures will continue to put pressure on house prices.

New-Home Sales Stumble to Second Lowest Level Since 1963
By JOSEPH LAZZARO - DailyFinance.com
It was, to paraphrase Shakespeare, the summer of our discontent in the U.S. housing sector: August's new-home sales clocked in at a 288,000-unit annual rate, unchanged from July's revised rate, and the second lowest level in 47 years.
The consensus prediction of economists surveyed by Bloomberg had been that new-home sales would rise to a 290,000-unit annual pace in August. New homes sales were revised to 312,000-unit and 282,000-unit paces in June and May, respectively, making the May level the new all-time low.

Big Banks May Be Forced to Buy Back Bad Mortgage Loans
BY DON MILLER, Associate Editor, Money Morning
Major U.S. banks are under pressure from government officials, as well as groups of investors and insurers, to repurchase or modify bad mortgage loans they pooled into securities and sold to unwitting buyers.
In the latest effort, a group of investors with roughly $500 billion invested in 2,300 mortgage securities is trying to force the large banks that originated or are now servicing faulty subprime-mortgage loans to repurchase or modify them, The Wall Street Journal reported.
Some investors "had no idea that their money was being invested in mortgage-backed securities," Dallas-based attorney Talcott Franklin told The Journal. "And yet somehow these people are now the ones being punished, and that's just not right."

FORECLOSURE FRAUD LETTER TO FANNIE MAE
FROM GRAYSON, FRANK and BROWN
This should send a powerful message to each and every Foreclosure Mill out there! You are NEXT!

September 24, 2010

Michael J. Williams
President and Chief Executive Officer
Fannie Mae
3900 Wisconsin Avenue, N.W.
Washington, D.C. 20016

Dear Mr. Williams,
We are disturbed by the increasing reports of predatory 'foreclosure mills' in Florida working for Fannie Mae servicers. Foreclosure mills are law firms representing lenders that specialize in speeding up the foreclosure process, often without regard to process, substance, or legal propriety. According to the New York Times, four of these mills are both among the busiest of the firms and are under investigation by the Attorney General of Florida for fraud. The firms have been accused of fabricating or backdating documents, as well as lying to conceal the true owner of a note.

Ally Told Freddie Mac of Faulty Foreclosures Weeks Ago
By Lorraine Woellert and Dakin Campbell
Sept. 24 (Bloomberg) -- Ally Financial Inc.'s GMAC Mortgage unit told Freddie Mac that foreclosures by the auto and home lender might have been faulty weeks before halting its own evictions, according to two people briefed on the matter.
Ally informed Freddie Mac on Aug. 25 that affidavits for court proceedings might not be valid, according to a person with direct knowledge of the matter. By Sept. 1, Freddie Mac had notified its network of lawyers and stopped related foreclosures and evictions, said the person, who declined to be identified because the matter hasn't been formally disclosed. GMAC told agents to halt evictions in 23 states on Sept. 17.

California AG calls for Ally financial foreclosure freeze
TheTruthAboutMortgage.com
California Attorney General Jerry Brown today called on Ally Financial, formerly GMAC, to immediately prove that it is complying with state law, or cease and desist from foreclosing on homes in the state.
State law prohibits mortgage lenders from recording notices of default (NODs) on mortgages originated between January 1, 2003 and December 31, 2007, unless the lender contacts or makes a "diligent effort" to contact the borrower to determine loan modification eligibility.

GMAC Halts Evictions Related to Foreclosures in 23 States
When News of Forged and Robo-Signed Documents Comes Out
Martin Andelman
I'm sorry, but is GMAC ... no, wait ... Ally Financial ...I keep forgetting they're my "ally" now ...run by a 40 Mule Team of morons? Don't answer that, it was clearly rhetorical.
Okay, so here's the story ... some attorneys representing homeowners in foreclosure noticed that GAMC was saying things that weren't true, which is sometimes referred to as "lying," and then in a deposition it came out that a middle manager at GMAC was actually signing 10,000 foreclosures a month without reading the paperwork like he was supposed toÉ or, one might consider ... like any normal human being would do given they had a job signing 10,000 of anything each month. I mean ... what the ... can you even imagine?

Administration Issues Housing Market Scorecard for September
by Jann Swanson - MortgageNewsDaily.com
The Obama Administration's September Housing Scorecard produced by the Departments of Housing and Urban Development (HUD) and Treasury continues to paint a picture of a slowly stabilizing housing market, with slight marginal improvements in many areas.Even the bad news such as housing sales was mitigated by a reference to more recently released information.

Mortgage Delinquencies Drop, as Foreclosures Jump
By Jeffrey Sparshott
A government report Friday said the number of seriously delinquent mortgages fell in the second quarter for the first time in more than a year, reflecting a surge in completed foreclosures as well as lower monthly payments as homeowners negotiated loan modifications.
But while the fall in serious delinquencies - mortgages that are 60 or more days past due - is positive, the overall home lending picture remains uncertain, said Bruce Krueger, a mortgage expert at the Office of the Comptroller of the Currency. "There are mixed signals right now," Krueger said.

GMAC's Errors Leave Foreclosures in Question
By DAVID STREITFELD - NYTimes.com
The recent admission by a major mortgage lender that it had filed dubious foreclosure documents is likely to fuel a furor against hasty foreclosures, which have prompted complaints nationwide since housing prices collapsed.
Lawyers for distressed homeowners and law enforcement officials in several states on Friday seized on revelations by GMAC Mortgage, the country's fourth-largest home loan lender, that it had violated legal rules in its rush to file many foreclosures as quickly as possible.

Author explores contradictions of 'company towns'
By Steve Weinberg Special for USA TODAY
Hardy Green begins his seriously conceived, breezily written study with a built-in contradiction: "Company towns are un-American - and they are the essence of America."
Green, a former BusinessWeek magazine editor with a doctorate in U.S. history, opens the book with the example of Butte, Mont., a town pretty much created and run by Anaconda Copper. He covers 50 more before ending the book, including Hershey, Pa.; Gary, Ind.; Corning, N.Y.; and Ludlow, Colo.

Census Bureau Poverty Rate
Drastically Undercounts Severity of Poverty in America
By David DeGraw, AmpedStatus Report
While the shocking new poverty statistics from the Census Bureau indicating that a record 43.6 million Americans lived in poverty in 2009 emphatically demonstrates the severity of the economic crisis, the Census is drastically undercounting this demographic. Apparently government poverty statistics are as accurate as their unemployment statistics.
I have read many reports that simply restate what the government has said without questioning the fact that the metrics they use to calculate poverty are extremely outdated.

Wealthbridge Mortgage laying off 109
PORTLAND BUSINESS JOURNAL
Wealthbridge Mortgage Corp. will lay off its staff after a deal to sell the Beaverton mortgage company failed to close on Sept. 20.
Wealthbridge already has laid off 16 employees and will lay off the remainder of its 109-member staff on Oct. 15, according to a notice filed with the state under the Worker Adjustment and Retraining Notification Act.
"Wealthbridge Mortgage Corp. intends to close its business and permanently lay off employees due to unforeseen circumstances outside of the company's control and its inability to obtain the necessary capital to remain in business," President Scott Everett said in a letter to local and state officials.

Unemployment filings jump back up
By Annalyn Censk
NEW YORK (CNNMoney.com) -- Initial filings for unemployment insurance ticked up in the latest week, but continued to hover in the same range they have been since November, the government reported Thursday.
The number of first-time filers for unemployment benefits rose to 465,000 in the week ended Sept. 18, the Labor Department reported Thursday.
The number was higher than economists' forecasts of 450,000 for the week, according to consensus estimates by Briefing.com. It also marked an increase from the upwardly revised 453,000 initial claims filed in the previous week, which was shortened by Labor Day.

GM's IPO Will Likely Be Smaller Than First Planned
By DAVID SCHEPP - DailyFinance.com
General Motors' pending initial public offering of stock was expected to be one of the largest in history. At an anticipated $16 billion, the IPO would have been second only to the $19 billion stock offer by credit card giant Visa (V) in 2008.
But now, the nation's No. 1 automaker is revising its IPO expectations downward, anticipating it will bring in $8 billion to $10 billion when shares go public in November, Bloomberg News reports, citing unnamed people familiar with the matter.

Blast from the Past: A Warning about Socialism
Mises Daily: by Gene Epstein
Pictures of the Socialistic Future tells an engrossing story about a socialist paradise that swiftly degenerates into a societal dungeon. Originally published in an English translation back in 1893 - which adds immeasurably to its resonance - it has been reissued recently in paperback by the Ludwig von Mises Institute, a research center on free-market economics.
Utopian and dystopian fiction is often weakened by cardboard characters. Not so in this case. German author Eugene Richter (1838-1906), a libertarian politician and journalist none of us is likely to have heard of, was not only blessed with uncanny insight about the realities of socialism, he had a novelist's ability to create engaging characters.

Someone shut the lights off please!
We need a moratorium on government
by Marti Oakley - PPJ Gazette
It appears to get worse by the day; corrupt politics, corrupt politicians and an ever expanding and more threatening federal government.
I cannot think of even one person I have talked to or corresponded with, who has expressed even a modicum of fear over terrorism threats from some unknown mad man bent on killing us all off because they "hate us for our freedoms". The fear is prevalent in their conversations, generated by the continual onslaught of legislation and Executive Orders issued from a growing and malevolent government; it is this government who hates us for our freedoms. In fact, it isn't even that they hate us for our freedoms; they just hate us! While the Obama Administration was surely not the instigator of these assaults on the nation, he is happily following in the footsteps of his predecessor, George Bush the Lesser and his merry band of neo-cons, and has continued the destruction of the sovereign United States.

The Enraged vs. the Exhausted
If you thought the 1994 election was historic, just wait till this year. - By Peggy Noonan - WSJ.com $$
All anyone in America who cares about politics was talking about this week was the searing encounter that captured, in a way that hasn't been done before, the essence of the political moment we're in. When 2010 is reviewed, it will be the clip producers pick to illustrate the president's disastrous fall.
It is Monday, Sept. 20, the middle of the day, in Washington. CNBC is holding a town hall for the president. A woman stands - handsome, dignified, black, a person with presence. She looks as if she may be what she turns out to be, an Obama supporter who in 2008 put up street signs, passed out literature and tried to win over co-workers. As she later told the Washington Post, "I was thinking that the people who were against him and didn't believe in his agenda were completely insane."

Pentagon destroys thousands of copies of Army officer's memoir
By Chris Lawrence and Padma Rama, CNN
Washington (CNN) -- The Department of Defense recently purchased and destroyed thousands of copies of an Army Reserve officer's memoir in an effort to safeguard state secrets, a spokeswoman said Saturday.
"DoD decided to purchase copies of the first printing because they contained information which could cause damage to national security," Pentagon spokeswoman Lt. Col. April Cunningham said.
In a statement to CNN, Cunningham said defense officials observed the September 20 destruction of about 9,500 copies of Army Reserve Lt. Col. Anthony Shaffer's new memoir "Operation Dark Heart."

Cleaning Up the Toxic Legacy of Closed Military Bases
By BRUCE WATSON - DailyFinance.com
Military base closures can leave behind a toxic environmental legacy that's damaging and expensive to repair. In fact, the U.S. Force and Navy both rank among the top 100 polluters in America, and many of the bases they've left behind as a result of the BRAC closures have been declared Superfund sites by the Environmental Protection Agency.
For most of the 20 bases that are currently slated to close, their path to a post-military rebirth will likely involve some measure of environmental remediation conducted either by the military or by private contractors. Depending upon the level of pollution and the vitality of the community, waste cleanup can vary considerably. To get an idea of what's ahead for the bases slated to close, we've looked at two distinct cleanup cases: Loring Air Force Base in Limestone, Me., and Lowry Air Force Base in Denver.

G. Edward Griffin Weighs In On Obama's Executive Order and Codex!
By Barbara H. Peterson - Farm Wars - PPJ Gazette
After Barry Soetoro signed Executive Order #13544 on June 10, I wrote an article titled "Barry Soetoro, Imposter in Chief, Implements CODEX ALIMENTARIUS by Executive Order in the U.S.!" This article was published on June 14, and raised more than a few hackles. It was immediately rebutted on June 26 by Scott Tips of the National Health Federation in a press release titled "The Obama Executive Order - More Healthcare Bureaucracy, but Not Backdoor Codex."

The Road to World War III -
The Global Banking Cartel Has One Card Left to Play
David DeGraw
I: Economic Imperial Operations
When we analyze our current crisis, focusing on the past few years of economic activity blinds us to the history and context that are vital to understanding the root cause. What we have been experiencing is not the result of an unforeseen economic crash that appeared out of the blue with the collapse of the housing market. It was certainly not brought on by people who bought homes they couldn't afford. To frame this crisis around a debate on economic theory misses the point entirely. To even blame it on greedy bankers, while essentially accurate, also misses the most vital point.

Obama Focuses at UN on Mideast, Currency Friction With China
By Julianna Goldman and Kate Andersen Brower
Sept. 24 (Bloomberg) -- President Barack Obama used the backdrop of the United Nations General Assembly meeting to tackle tensions with China and to urge world leaders to support the Middle East peace process, two issues that are testing his economic and foreign policy plans.
The U.S. president pressed China's Premier Wen Jiabao over currency valuation during a two-hour meeting yesterday, an adviser said, as momentum is building in Congress for trade sanctions if the yuan remains what the U.S. views as undervalued.

Just in time for S.510: The EU will set world dairy standards
Europe to lead world dairy quality standards and welfare, says expert
By Mike Stones - PPJ Gazette
Europe will set the standard for the world dairy industry, specifically for milk quality and cow welfare, an international dairy expert has told a recent conference in Brussels staged by Pfizer Animal Health.
Ynte-Hein Schukken, professor of Epidemiology and Herd Health at Cornell University, US, told delegates that "Most of the milk produced throughout the developed world will be following the same standards as those set in the EU," according to UK farm publication Farmers Guardian.

Netanyahu Urges Abbas to Stay in Talks as Freeze Ends
By Gwen Ackerman and Flavia Krause-Jackson
Sept. 27 (Bloomberg) -- Israeli Prime Minister Benjamin Netanyahu urged Palestinian Authority President Mahmoud Abbas to press forward with peace talks after a 10-month partial moratorium on building in the West Bank came to an end.
"I hope that President Abbas will continue the talks and continue with me the path to peace that we began three weeks ago," Netanyahu said in a text message sent to journalists from his office.

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Friday 09.24.2010

Republicans unveil 'Pledge to America'
By Stephanie Kirchgaessner in Washington - FT.com
Republican lawmakers seeking to take back the House of Representatives in November are promising that tax cuts and a sharp cutback in government spending will revive the slumping US economy as part of their new "Pledge to America".
The proposed agenda is due to be formally unveiled on Thursday as Republicans seek to counter accusations by Democrats that they represent the party of "no". The move is meant to emulate Newt Gingrich's "Contract with Americ", a series of pledges set out by the GOP in 1994 when it took control of the House after decades of Democratic control.

GOP's agenda aims to shrink government
By Paul Kane and Perry Bacon Jr. - Washington Post Staff Writers
House Republicans will announce an expansive agenda on Thursday called "A Pledge to America" that proposes to shrink the size of government and reform Congress, offering a conservative plan of action they will pursue if they win a majority in the midterm elections.
Republicans would slash $100 billion in government spending on nonmilitary agencies and replace President Obama's landmark health-care legislation with a scaled-back version. Small businesses would be able to deduct from taxes up to 20 percent of their annual income, and the Pentagon would receive increased funding to more quickly implement a ballistic missile defense system.

Bill Clinton Calls Republicans' Plans 'Hysterical Tirades'
By Julianna Goldman
Sept. 23 (Bloomberg) -- Former U.S. President Bill Clinton called the governing agenda Republicans unveiled today an "ideological document" and warned that it would be implemented at the expense of America's middle class.
"They don't know that the model for success in the 21st century is a vigorous private sector, an effective government, a partnership, not these hysterical tirades against government," Clinton said in an interview for Bloomberg Television's "Political Capital with Al Hunt" at the Clinton Global Initiative meeting in New York.

Western U.S. at risk of double-dip recession
Five years after bubble, it's still all about housing
WASHINGTON (MarketWatch) - Most regions of the United States are showing signs of economic life, but the West could drop back into recession because the housing market is still comatose, according to research released Thursday by the Dismal Scientist of Moody's Analytics.
In a city-by-city overview, economist Steve Cochrane reported that 65 of the nation's 389 metro areas remained in recession as of July. A year ago, nearly all were. Most of the recessionary cities are in the West, especially central and northern California "where household wealth has suffered declines of over 50%, foreclosures remain high, and employment has yet to stabilize," Cochrane said.

Is the Church Causing America's Fall?
Evil exists, and the only people who can overcome it are knowledgeable, spiritual Christians. Unfortunately, most Christians are not. By Jack Heckathorne - gjcn.org
Virtually all major denominations and religions are teaching things that are totally contrary to the Bible. In addition, they are not teaching many of the life changing concepts which are found in scripture. They mix in enough truth as to make their ideas and psychology sound plausible but the messages on key points are totally opposite of GodÕs word therefore, whole biblical concepts are lost.

$700 billion too much? Why is $3 trillion OK?
By Jeanne Sahadi
NEW YORK (CNNMoney.com) -- President Obama says the country can't afford the $700 billion it would cost to permanently extend the Bush tax cuts for high-income households.
He said it would be "irresponsible" to borrow that much money just to hand out $100,000 tax cuts to millionaires.
Fair enough. The United States is staring at a serious medium- and long-term debt situation, so the less it's aggravated the better.
But why then is it OK to borrow $3 trillion to permanently extend the tax cuts for the majority of Americans -- something the president and both parties support doing?

Obama presses China's Wen on yuan's value
'More action' urged at bilateral meeting in New York
By Robert Schroeder, MarketWatch
WASHINGTON (MarketWatch) -- The United States is expecting China to move more rapidly to allow the value of China's currency to rise, President Barack Obama told Chinese Premier Wen Jiabao in New York on Thursday.
Obama made clear to Wen in a meeting on Thursday that the U.S. wants to see "more action" about the value of the yuan, senior White House official Jeff Bader told reporters after the leaders met on the sidelines of the United Nations General Assembly.

Wen Warns 20% Yuan Gain Would Cause 'Major' Upheaval
By Ye Xie
Sept. 23 (Bloomberg) -- Chinese Premier Wen Jiabao said a 20 percent rise in the yuan would cause severe job losses and trigger social instability, putting the nation on course for a clash with U.S. lawmakers demanding a stronger currency.
"We cannot imagine how many Chinese factories will go bankrupt, how many Chinese workers will lose their jobs, and how many migrant workers will return to the countryside" should China acquiesce to demands for a 20 percent to 40 percent gain, Wen said in New York yesterday. "China would suffer major social upheaval."

China claims poverty, begs for U.S. patience
Premier won't budge on yuan-dollar currency policy
By Christopher Hinton and Chris Oliver, MarketWatch
NEW YORK (MarketWatch) - Chinese Premier Wen Jiabao recommitted his country to opening its markets and instituting economic reforms, but he said U.S. demands that it change its currency policies were misguided.
"If the renminbi appreciates by 20% to 40%, according to the requests of the U.S. government, we do not know how many Chinese companies will go bankrupt and how many Chinese workers will be laid off... and there will be major turbulence in the Chinese society," Wen said Wednesday.
China's renminbi is also known as the yuan.

Japan Agrees With US on Chinese Monetary Policy
By Chuck Butler - The DailyReckoning.com
09/23/10 St. Louis, Missouri - The euphoria in the currencies and metals carried through yesterday morning, with the euro (EUR) bumping up to 1.3425, and the Aussie dollar (AUD) bumping up to 0.9568 ... But the profit taking began to step in, and soon all the lofty levels that the currencies and metals had gained for the previous 24 hours were seeing slippage, and that slippage soon became hard selling.
I had told the boys and girls on the trading desk here, yesterday, when the euro traded above 1.34, that the euro had "gapped" through 1.32, and 1.33, and I wouldn't be surprised to see the currency go back and fill in those gaps, which is another way of saying that 1.3435 wasn't going to last ... And it didn't!
The one currency that is kicking tail and taking names later this morning is the Swiss franc (CHF), which is trading above parity to the dollar once again. And versus the euro, the franc is really strong!

Unregulated Derivatives Being Sold To Your Grandmother
First Blood for Elizabeth Warren
The Daily Bail
There's been quite a stir regarding Elizabeth Warren, her background, her appointment and her role in the consumer protection agency she now oversees.
This would be a good first test of her resolve
Monetary illusionists have argued for years that "institutional investors should be fully aware of the risks involved in derivative instruments" to obscure the criminality of their scams with "sophisticated" slight of hand. And as Tavakoli has pointed out, time and again, this favorite "get out of jail pass" frequently played by Goldman and JPM, fails the sniff test of any regulator not on the Wall Street Casino's current or future payroll.

Permanent 0% On Road To Ruin
By: Jim Willie CB - GoldSeek.com
Japan has proved without confusion that 0% is a permanent stuck position. The United States will repeat the path, but with a vast mudslide. Japan has had the advantage of a strong industrial base, a sizeable trade surplus, and no war budget. Thus it has been capable of funding much of its own deficits. It does possess a big debt burden. But the US has $1 of new debt for every $1 in government revenue. The US war budget is almost as large as its total revenue. The US depends upon foreign creditors, many of whom have been thoroughly alienated. Apart from the structural and foreign angles, the US is stuck with a 0% policy. The USFed has no Exit Strategy at their avail, precisely what the Jackass has stated for over a year. It cannot manage any change, as sharp knives, machetes, and guillotines await on the other side of the monetary doorway. The present 0% road to ruin is fixed, as the USFed cannot change course from it.

Alaska's New Gold Rush
By Louis James, GoldSeek.com
Alaska is one of the most prospective and yet most underexplored areas in the world. There are good reasons for the neglect, most notably the long, cold winters and the lack of infrastructure. Whether the latter is a result of, or a cause of, there being few people in the state is an open question.
One clear result, however, is a rather small economy: Alaska's 2009 GDP was US$47.3 billion, comparable to that of the Dominican Republic or Bulgaria. The state is ranked 44th by GDP among its U.S. peers.
In terms of metals, Alaska produces gold, silver, copper, lead, and zinc. Being well endowed with natural resources, Alaska's mining history dates back to the early 1800s, when Russian explorers prospected the region, looking for placer gold. But not until after Russia sold Alaska to the United States did exploration activities start to develop rapidly, both on placer and hard rock deposits.

Are Corporate Insiders Ditching Their Firms for Precious Metals?
By Dr. Jeffrey Lewis - GoldSeek.com
Corporate insiders are flocking out of their own companies, selling $290 in stock for every $1 they buy in S&P 500 firms. With outflows of more than $439 million dollars in equities by corporate insiders and inflows in the billions flowing into precious metals ETFs and securities, would it not be safe to assume that the same insiders dumping their shares are on the buying end of the metals spectrum?
Insider Activity
Bloomberg reports weekly data on the number and value insiders in S&P500 companies buy and sell on a week to week basis. In the week ending September 17, insiders made purchases of just $1.4 million and sales of $441 million for net outflows of $439 million. Breaking down the numbers, investors should see that for every $1 of stock purchased, $290 was sold - a very clear trend. Last week, that ratio was even higher at 649:1.

What's The Call on Gold?
By: David N. Vaughn - GoldSeek.com
Banks are failing across the country at a growing rate.
Actually, the truth is that the US banking system is close to collapsing. And what's happening with gold? Gold recently struck an all time high as it climbed to a record 1,278 dollars!
Investors, and just those with plain common sense, are buying more and more gold helping to send the price of gold ever higher! As never before everyone and his or her brother is recognizing that gold is the appropriate investment as the world crumbles around us. Also, gold will be the best investment when government eventually induces inflation and only gold will outpace inflation enormously. You sure will not want to have your savings in dollars as those days are almost here.

Gold Steady Despite Dollar Rally
By: Adrian Ash - MarketOracle.co.uk
THE PRICE OF GOLD sat tight above $1290 an ounce in London on Thursday morning, holding 1.4% above last week's close as European stock markets extended their losses to 1.2% and crude oil dropped below $74 per barrel.
"Gold has remained fairly steady around yesterday's closing level, in spite of a stronger Dollar," says one London dealer in a note.
"A quiet session overnight," says another, with gold "basically tracking the Euro" against the US Dollar as Tokyo and Hong Kong joined Shanghai in closing for a holiday.
The Dollar today knocked the Euro 0.5¢ off Wednesday's 24-week high above $1.34, but it fell back against the Japanese Yen.

Undervalued Silver in a Government Spending Frenzy
By The Mogambo Guru - The DailyReckoning.com
09/23/10 Tampa, Florida - To prove that all my yelling, "Buy silver now, or you're a moron!" has paid off, silver is getting a lot more press coverage lately, like the headline "Silver Hits '80 Level; Gold Sets Fresh High," which appeared on the front page of The Wall Street Journal's "Money and Investing" section.
The reason that gold at $1,271 was hitting new record-highs, but not silver, is that silver, at $20.74 per ounce, is only at the highest price since October 1980, which is almost exactly 30 years ago.

Silver's rally strong long-term; short-term may see correction
By Debbie Carlson
(Kitco News) - Silver prices have seen a major bull rally since spiking higher in late August and long-term market watchers are bullish on the grey metal, but short-term prices could be getting ready for a correction.
As gold prices rallied so has silver as the "poor man's gold" enjoys some attention from the speculative class. For those who choose not to buy gold as an alternative currency, silver has offered an inexpensive way to invest on that thesis. Further, silver has benefitted from its dual role as an industrial metal, rallying alongside copper and other base metals as ideas of an eventual global manufacturing recovery pick up.

The Illusion of Prosperity Driven by Debt
By Rocky Vega - The DailyReckoning.com
09/23/10 Stockholm, Sweden - Michael Hirsh, author of Capital Offense: How Washington's Wise Men Turned America's Future Over to Wall Street, recently appeared on Morning Joe to talk about Wall Street's pre-crisis, decades-long encroach upon Washington that would eventually end in financial crisis.
In his estimation, the gradual takeover was about 30 years in the making. It got underway when the ideals of free market revolution were sweeping mainstream economics and all common sense of boom and bust cycles - how markets are prone to wild swings of manias and panics - was abandoned to instead funnel increasing power to financial services in hopes of ever-greater returns and economic growth.

Deflation Trend That's Become Too Obvious To Ignore
By: EWI - MarketOracle.co.uk
As the biggest credit bubble in history continues to shrink, consumer prices have stayed flat over the past several months, meaning there is no sign of inflation to come, despite growing commitments from the U.S. government.
So what's keeping inflation at bay, given all the stimulus money promised? The answer: Deflation -- an overwhelming urge for consumers to liquidate their assets for cash. And this new economic phase is finally becoming too obvious to ignore, as explained in recent commentary from the world's largest technical analysis firm.

Dreary Data on Jobs and Europe Cools Enthusiasm on Wall Street
By THE ASSOCIATED PRESS - NYTimes.com
A September stock rally weakened on Thursday as investors were disappointed by a jump in unemployment claims and more signs of trouble for Europe's economy.
The market got off to a bad start after applications for unemployment benefits rose unexpectedly last week. European stocks also sank after a lower reading on business activity in the 16 countries that use the euro and news that Ireland's economy shrank 1.2 percent in the second quarter.

30 Trillion for Quantitative Easing (QE) 2? It's Time to Get Radical!
By: Chris Kitze - MarketOracle.co.uk
Yes, it's time to get radical on the economy and no, I'm not talking about going full Karl Marx -- the politicians in Washington appear well down THAT road.. The next set of bailouts could run $30 trillion (as I'll explain in a bit) and that's probably not the end of it because all the future government entitlements are well over $100 trillion. This is not only unaffordable, any attempt to make good on even a small portion of this is a fool's errand. In addition to attempting an impossible task that is doomed to fail, we're bailing out the wrong people! Hopefully, this article will get you thinking -- feel free to leave a comment and help our discussion.

UNCLE SACHS RULES U. S. FINANCE
Greenspan, Naked Short Selling and Fraud Abide
By Wayne Jett - ClassicalCapital.com
In all Alan Greenspan's years chairing the Federal Reserve (1987-2006), "the Maestro" played only the Phillips Curve Symphony: destroy jobs to fight inflation. Now Greenspan has composed an equally dismal refrain: raise tax rates to reduce deficits. At least this service to the dominant elite is slightly less unseemly, now that he is paid directly by them rather than by their central bank.
Greenspan was interviewed for an hour by Mort Zuckerman at the New York-based Council on Foreign Relations. The CFR has 4,000-plus members who act to various degrees in a high-powered secretariat to advance "the new republic" in taking full power unencumbered by the U. S. Constitution. Greenspan told CFR the Obama stimulus spending was not nearly as successful "as many had hoped" because government deficit borrowing crowded out private growth.

Ireland faces double dip, mulls restructuring of junior bank debt
Irish borrowing costs have surged to a post-EMU record after Ireland's recovery buckled over the summer and Dublin said creditors of Anglo Irish Bank may be asked to "share" losses, a warning to bondholders that the dam may at last be breaking on debt restructuring in the eurozone.
By Ambrose Evans-Pritchard - Telegraph.co.uk
The Irish economy contracted at a 1.2pc rate in the second quarter, making Ireland the first country since the Great Recession to face a double-dip downturn. The setback is blow for hopes that Ireland can slowly grow its way out of debt, and may renew concerns that fiscal austerity without other forms of relief risks tipping the economy into a self-reinforcing spiral.
Ireland has been praised for grasping the nettle early in its debt crisis with public sector wage cuts of 13pc, leading the way for other eurozone debtors in trouble. But the reward for good behaviour has yet to come.

Dr. Marc Faber on the Federal Reserve and Hyperinflation
By Ron Hera - GoldSeek.com
The Hera Research Newsletter (HRN) is delighted to present the following powerful interview with noted speaker and best selling author Dr. Marc Faber, whose newsletter, The Gloom Boom & Doom Report, highlights unusual investment opportunities. Dr. Faber is a popular speaker at investment seminars and conferences around the world and is best known for his contrarian investment approach.
Born in Zurich, Switzerland, Dr. Faber went to school in Geneva and Zurich and finished high school with the Matura. He studied Economics at the University of Zurich and, at the age of 24, obtained a PhD in Economics magna cum laude.

Audience Reaction To Greenspan's Cfr Speech
"That Was Scary As Shit..."
The DailyBail.com
Keynesian Alan Greenspan Gets Religion, Issues Warning To Obama & Congress: "The Stimulus Failed! Stop Spending!"
Another Keynesian has come around from the dark side. How long until Krugman, Delong, & Romer admit the multi-trillion dollar error of their ways. Never. They are political economists, trolls really, and they are focused on extending the power of the Federal government and winning elections for Democrats. Now onto Sir Alan's conversion. Extremely enlightening speech from Greenspan yesterday sponsored by the Council on Foreign Relations (CFR). Greenspan says watch gold prices, stop the futile attempts at stimulus, let the Bush tax cuts expire, and slash government spending quickly and aggressively. Check out some of the quotes below.

Senate Democrats postpone tax cut vote until after elections
By Lori Montgomery - Washington Post Staff Writer
Senate Democrats said Thursday that they had abandoned plans for a pre-election showdown with Republicans over taxes, postponing any vote on extending Bush administration tax cuts until after the November midterms.
Democrats discussed the issue during a caucus luncheon but left the final decision to Senate Majority Leader Harry Reid (D-Nev.). Late Thursday, Reid spokesman Jim Manley said, "We will come back in November and stay in session as long as it takes to get this done."

Forbes list: America's super-rich get richer
America's super-rich got even richer this year with the country's wealthiest 400 people increasing their collective value to $1.37 trillion (£870 billion.)
By Nick Allen in Los Angeles - NYTimes.com
A total of 217 tycoons on the list, which is compiled annually by Forbes magazine, boosted their fortunes while only 84 saw a decrease.
It took at least $1 billion (£640 million) just to be included and the combined worth of the group was up eight per cent from last year, vastly outperforming the stock market.
The exclusive club now accounts for about 2.6 percent of all private wealth in the US, and its members are worth a similar amount to the gross domestic product of Spain or Canada.

Chrysler Auto Workers Caught Drinking & Smoking Pot

Recession Officially Over ... Someone Tell the Unemployed
By Bill Bonner - The DailyReckoning.com
09/23/10 Delray Beach, Florida - Yesterday, the Fed's FOMC group announced that it was standing pat. Yes, it might have to do something in the future. But for now, it is neither exiting its stimulus monetary position ... nor is it adding to it.
The stock market didn't know whether that was good or badÉso it didn't do much of anything. The Dow went down 24 points. But gold soared to a new record - up $17.
Officially, the recession is behind us. That's the good news. Officially, it ended in June of '09.
The bad news is - so what? Recession or no recession, people are having a hard time finding jobs and making ends meet. The US economy continues rumbling and trundling along. It is a Great Correction ...

Weekly jobless claims rise 12,000 to 465,000
Continuing claims drop 48,000 to 4.49 million
By Jeffry Bartash, MarketWatch
WASHINGTON (MarketWatch) - The number of people who filed new claims for unemployment benefits jumped 12,000 to 465,000 in the latest week, underscoring the lack of hiring in a weak U.S. labor market.
New claims for jobless benefits had dropped two straight weeks, but part of the decline stemmed from a disruption in the government's data collection caused by the Labor Day holiday in early September. Claims often rise briefly after the holiday.

Desperate Americans Begin To Turn Houses into Restaurants

Debt, changing media habits topple Blockbuster
By Mae Anderson - Associated Press
NEW YORK (AP) - Blockbuster Inc., once the dominant movie rental company in the U.S., filed for Chapter 11 bankruptcy protection on Thursday, after reeling from mounting losses, rising debt and competitors that have better catered to Americans' changed media habits.
Blockbuster will continue to operate its 3,000 U.S. stores. But the move, long expected, marks the end of an era that Blockbuster and its gold-and-blue torn ticket logo helped establish - of Americans visiting video-store chains for the latest movie-rental releases. Increasingly, Americans are forgoing Blockbuster and watching movies via video subscription services like Netflix Inc., video on demand and vending machine services such as Coinstar Inc.'s Redbox.

U.S. August Home Sales Were Actually Terrible!
By: Sy Harding - MarketOracle.co.uk
Sometimes I long for the days when newspapers and magazines were the main sources of economic information for investors. They took the time to analyze data before their headlines and reports influenced investor thinking.
With television and the Internet, the goal is not accuracy but speed.
With investors glued to their TV sets when each economic report is due, those reporting it must comment instantly, giving a kneejerk reaction without time to analyze the data. And with investors constantly surfing the Internet looking for the latest news for guidance, the first websites to carry the headline corresponding to the latest economic report is going to get the millions of 'hits' that produce higher advertising revenue.

Canadians become top out-of-state homebuyers in Ariz.
By Haya El Nasser, USA TODAY
The collapse in housing prices and a strong Canadian dollar are luring north-of-the-border buyers to Arizona and other states where the weather is warm and the housing cheap.
Canadians surpass Californians this year as top out-of-state buyers of Phoenix-area real estate. The Canadian dollar is gaining, up from an average of 80 cents on the U.S. dollar in 2005 to 97 cents last week. At the same time, home prices in the Phoenix area have dropped about 50% from their peak in early 2007.

Union calls off Arizona SB 1070 boycott
PHOENIX BUSINESS JOURNAL
The United Food and Commercial Workers Union has called off its boycott of Arizona over the Senate Bill 1070 immigration law.
The UFCW and other unions have been part of economic and tourism boycotts in the state, which Arizona Gov. Jan Brewer and others say hurt the state's already lagging economy.
Brewer's campaign was organizing a protest in front the UFCW's Phoenix offices over the boycotts.
The grocery workers union said Thursday it is calling off its boycott and will work toward more positive outcomes on the contentious immigration front.

F.C.C. Opens Unused TV Airwaves to Broadband
By EDWARD WYATT - NYTimes.com
WASHINGTON - The Federal Communications Commission approved a proposal on Thursday that would open vast amounts of unused broadcast television airwaves for high-speed wireless broadband networks and other unlicensed applications.
The change in available airwaves, which were freed up by the conversion of television signals from analog to digital, constitutes the first significant block of spectrum made available for unlicensed use by the F.C.C. in 20 years.
It was a victory that did not come easily, or quickly, however. The F.C.C. first approved a similar measure in 2008, but the technical requirements for unlicensed devices drew objections from 17 companies or groups on both sides of the issue, forcing the commission to redraft its proposal.

Cyberwar Chief Calls for Secure Computer Network
By THOM SHANKER - NYTimes.com
FORT MEADE, Md. - The new commander of the military's cyberwarfare operations is advocating the creation of a separate, secure computer network to protect civilian government agencies and critical industries like the nation's power grid against attacks mounted over the Internet.
The officer, Gen. Keith B. Alexander, suggested that such a heavily restricted network would allow the government to impose greater protections for the nation's vital, official on-line operations. General Alexander labeled the new network "a secure zone, a protected zone." Others have nicknamed it "dot-secure."

from February 15, 2009 . . . still true; but worse
Land Of The Free And Home Of The Broke:
The United States Of Insolvent
The DailyBail.com
The heretofore unthinkable is getting some notice. The impending passage of the $800 billion federal stimulus is stoking the fires. We are a nation on an ever-steadying path to insolvency. David Walker was correct, we are Rome. I have been waiting to do this piece for awhile. As a 21 year-old rookie at still fledgling CNN Washington in the summer of 1987, I got to know one of our senior producers while I rotated through the graveyard shift. Charlie covered the overnight from Washington and never had anything to do because Atlanta was in charge from our Larry King sign-off at 10 pm until they tossed back at 7 am the next morning. (This was the summer of Oliver North and the Iran Contra hearings and Atlanta wanted someone on stand-by in DC just in case.) Mostly, Charlie just read to pass the time and talked.

Republicans shape up for midterm attack
By Edward Luce in Washington - FT.com
"Folks, wake up!" Barack Obama, the US president, told Democrats on Monday night at a fundraising event for a party that appears to be sleepwalking to defeat in November. "Don't compare us to the Almighty, compare us to the alternative."
On Thursday the Republican party will go some way towards obliging the US president's request. Dubbed the "new Contract with America" after the iconic manifesto that Newt Gingrich, the Republican leader, unveiled ahead of the 1994 landslide, Republicans will attempt to counter Mr Obama's charge that they are the "party of no" by unveiling an agenda for governing.

October SURPRISE could be "out of this world"
E.T. . . . phone Rome!

Vatican And ET Disclosure

CNN Report on the UFO Disclosure Movement

CODEX ALIMENTARIUS:
The Elephant in the room they don't want you to see!
Codex isn't coming ... its already here!
By Barbara H. Peterson - PPJ Gazette
Why is there so much denial by consumer advocate groups such as the National Health Federation(1) (NHF) about Barry Soetoro implementing the U.S. Codex council via Executive Order(2)? What is it that they don't want you to see? Just do the research, and you will discover that we have been up to our eyeballs in Codex since 1962 and don't even know it.
Codex is a subsidiary body of the Food and Agriculture Organization (FAO) of the United Nations and the World Health Organization (WHO). Codex develops international food safety and quality standards, such as standards concerning the safety of food additives. Standards set by Codex traditionally served as a minimum floor for less developed countries. The U.S. has participated in Codex since its formation in 1962 and has shared its technical expertise in efforts to aid less developed countries.

US House puts oceans, coasts under UN:
Senate vote will seal the deal
by Carmen Reynolds, Paul McKain and Karen Schoen - infowars.com
"It's too late; it'll just have to be stopped in the Senate," Tom, the young male answering the phone in U.S. Rep. John Boehner's (R-Ohio)Washington D.C. office, said about HR 3534 (CLEAR Act). This is the globalist bill designed to give away our land, oceans, adjacent land masses and Great Lakes to an international body, and makes us pay $900 million per year until 2040.
HR 3534 is a thinly disguised permanent roadblock to American energy which drives American companies out of the Gulf, delays future drilling, increases dependency on foreign oil, implements climate change legislation and youth education programs; but most important, it mandates membership in the Law of the Sea Treaty without the required two-thirds vote to ratify it in the U.S. Senate. Read more at LOST below

Justice Department Report Criticizes FBI Spying On Anti-war Groups
by Kurt Nimmo - Infowars.com
The Justice Department's Inspector General has issued a report critical of the FBI for its spying on anti-war activists, animal-rights groups, and environmentalists. The report, entitled A Review of the FBI's Investigations of Certain Domestic Advocacy Groups, said the "terror" investigations were "unreasonable and inconsistent with FBI policy."
In fact, since the creation of the FBI in 1935, the agency has served as a secret police force and has been used against official enemies of the state, including the civil rights and anti-war movements.

NUGENT: Freedom versus Shariah
Americans must choose because the systems can't coexist
By Ted Nugent - The Washington Times
We've been told there are so-called moderate Muslims who deplore terrorism and that Islam has been hijacked by extremists.
If there are in fact moderate Muslims, they have been quiet as mosque mice regarding their views. For example, Americans don't know if moderate Muslims recognize Israel, what they think about women's rights, or if they believe the proposed New York City mosque should be moved to another location out of concern and sensitivity for the families of the victims of Sept. 11, 2001.
We also don't know if there are other freedom-loving and freedom-fighting Muslims who respect the rights of others to burn the Koran, draw cartoons of Muhammad in newspapers, hold marches to condemn Hamas and other terror organizations, write unflattering books about Islam, and vigorously support allowing people of other faiths to practice them in the city of Mecca, where all religions except Islam are currently outlawed.

Social Engineering Bill In Senate Will Force You Into City
by Bob Livingston Personal Liberty Digest
A social engineering bill to restrict residence in the suburbs and rural areas and force Americans into city centers has passed the United States Senate Banking Committee and is on the fast track to passage in the Senate.
The bill is called the Livable Communities Act (SB 1619) and it was introduced by corruptocrat outgoing Senator Christopher Dodd (D-Conn.). It seeks to fulfill the United Nation's plan Agenda 21, adopted at the Earth Summit in Rio de Janeiro in 1992 and signed onto by "New World Order" President George H.W. Bush.

US walks out on Ahmadinejad
Iranian president: 9/11 was a U.S. conspiracy
By Colum Lynch - WashingtonPost.com
Iranian President Mahmoud Ahmadinejad today delivered a highly provocative U.N. speech that challenged the U.S. assertion that Islamic terrorists carried out the 9/11 attacks, and suggested that elements within the U.S. government may have orchestrated the attacks to justify military aggression on behalf of Israel in the region.
The remarks triggered an immediate walkout by the U.S. delegation and its allies, who accused the Iranian leader of engaging in an anti-Semitic rant.

US government behind Sept 11 attacks, Ahmadinejad says
Mahmoud Ahmadinejad, the president of Iran, caused fresh outrage on Thursday when he said most people believed the US government was behind the September 11 attacks, prompting the American, British and several European delegations at the United Nations to walk out.
By Alex Spillius in New York - NYTimes.com
In a speech to the UN General Assembly, Mr Ahmadinejad said it was mostly US government officials who believed a "powerful and complex terrorist group" was behind the four suicide plane hijackings in 2001.
Another theory, he said, was "that some segments within the American government orchestrated the attack to reverse the declining American economy, and its grips on the Middle East, in order to save the Zionist regime".

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Thursday 09.23.2010

Cost Of Holding Dollars Just Went Up
The LFB - Seekingalpha.com
Complete separation in Usd-Equity trade correlations have been seen overnight as the allure of holding the Usd as a safety play was finally rejected, after running at a very high percentage link that saw Usd Up- S/P Down and vice versa.
The move to sell the dollar index down to test support at 80.00 while equity markets were also sold lower may be the first signal that the cost of holding the dollar, and the premium required to insure safety, is going up.

Devaluing the Dollar
BY STEVE SAVILLE
There is regularly talk about the Fed (or Treasury) devaluing the US dollar, but how do you devalue something that doesn't have a fixed measurement? Specifically, what would the Fed/Treasury devalue the dollar against and how would they go about it? In a recent interview with Eric King, Jim Rickards posits that the Fed could bring about a general dollar devaluation by using its open market operations to bid up the gold price, the idea being that devaluing the dollar against gold would scare people out of dollars and thus cause a reduction in the dollar's purchasing power. Would this work?

That Rumbling Sound Is Dollar Giving Way
By: Rick Ackerman - GoldSeek.com
For nearly twenty years, we haven't flinched from our prediction that the massive debt build-up of the last generation would precipitate out as a deflationary bust. That is what we still expect, although we now believe there is likely to be a hyperinflationary phase at some point as the financial system implodes. But the bottom line is that no matter how things play out, America's standard of living will fall more steeply than at any other time since the Great Depression. As for the deflation-vs.-hyperinflation "debate," it is useful only to the extent it helps predict how mortgage debtors will fare as economic disaster unfolds. We seriously doubt they will be "saved" by the kind of hyperinflation that would put hundred-thousand-dollar bills in Joe Homeowner's wallet. Imagine how mortgage lenders would react if Joe could peel off three or four of those bills and say, "Okay, pal, we're square." This scenario will seem particularly unlikely to those who believe that these economic hard times have been engineered by Masters of the Universe intent on stealing our property. Trust us on this: If there's a hyperinflation, it is the rentiers who will get screwed most ruinously, not the little guys.

Currency Crisis Has Begun
By Toby Connor, GoldSeek.com
It's been my position for a while that Bernanke's monetary policy would eventually create a currency crisis in the world's reserve currency.
I warned that crisis would begin as soon as it became apparent the dollar was caught in the grip of the 3 year cycle decline.
I had three conditions that had to be met before I was willing to call the beginning of the end. The first condition was for the dollar to move below `82. That was the warning shot that problems were developing.
The second and third conditions were a move below long term support (80) and a failed intermediate cycle.

Foreign Currency Wars fuel Gold's Rally to $1,300 /oz
by Gary Dorsch, GoldSeek.com
With the price of gold zeroing in on yet another major milestone, - $1,300 /oz, some heavy hitters in the marketplace are beginning to wonder if the yellow metal's rally, is getting a bit too frothy, or even worse, whether a speculative bubble is brewing, that might ultimately deflate under its own weight, and lead to a sharp correction. On Sept 15th, famed hedge fund trader George Soros said that gold prices might continue to rise, but warned that that gold is the "ultimate bubble."

Dollar sinks and gold soars as Fed signals it wants to stoke inflation
-- Tom Petruno - LATimes.com
Investors and traders dumped the dollar and sent gold to yet another record high Tuesday, taking their cues from the Federal Reserve's apparent readiness to drive interest rates down further and inflation up.
The markets' verdict was clear: They believe Fed Chairman Ben S. Bernanke is willing to debase the dollar to avoid the risk of the economy falling into deflation.
The euro currency surged to a seven-week high of $1.326 from $1.306 on Monday. The DXY index, which measures the dollar's value against six other major currencies, slid 1.2% to 80.40, its lowest level since mid-April.

Gold Jumps to Record as Fed Policy Statement Drives Dollar Down
By Pham-Duy Nguyen and Anna Stablum
Sept. 22 (Bloomberg) -- Gold futures climbed to a record $1,298 an ounce after the Federal Reserve said it was willing to ease monetary policy further to boost the U.S. economy, triggering a slump in the dollar.
The metal surged to an all-time high for the fifth straight session. The greenback declined to a six-month low against a basket of major currencies. The Fed signaled yesterday it may expand its near-record $2.3 trillion balance sheet as soon as November. Silver rose to the highest closing price since 1980.

Gold hits record after Fed raises deflation specter
By Polya Lesova and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold futures soared to new record Wednesday, fueled by fears of deflation after the Federal Reserve signaled it may inject more cash into the financial system to support the U.S. recovery.
Silver hit a 30-year high as precious and base metals were further aided by a weaker dollar. Copper hit a five-month high, while platinum reached its best in four months.
The U.S. currency came under heavy selling pressure in the wake of the Fed's latest policy announcement on Tuesday. See more on the euro's latest gains against the U.S. dollar.

Gold Climbs to Record, Silver Jumps to 30-Month High on Dollar
By Wendy Pugh and Glenys Sim
Sept. 22 (Bloomberg) -- Gold climbed to a record for a fifth day after the Federal Reserve said it was willing to ease monetary policy further to boost the U.S. economy, triggering a slump in the dollar. Silver jumped to a 30-month high.
Bullion for immediate delivery advanced as much as 0.5 percent to $1,293.35 an ounce, before trading at $1,289.75 at 3:45 p.m. in Singapore. Gold, which often moves counter to the dollar, has advanced about 18 percent this year and is heading for its 10th annual gain.

Gold/Silver Ratio Analysis
By: Jordan Roy Byrne - MarketOracle.co.uk
The Gold/Silver ratio has just broken in favor of Silver. In other words, the ratio has broken to the downside. This development along with persistent strength in Gold has prompted the mainstream gurus and "experts" to talk up Silver. We've been writing about the potential in Silver on more than one occasion.

Fiat Currency Wars, Competitive Devaluations Fuel Gold's Rally to $1,300/oz
By: Gary Dorsch - MarketOracle.co.uk
With the price of gold zeroing in on yet another major milestone, - $1,300 /oz, some heavy hitters in the marketplace are beginning to wonder if the yellow metal's rally, is getting a bit too frothy, or even worse, whether a speculative bubble is brewing, that might ultimately deflate under its own weight, and lead to a sharp correction. On Sept 15th, famed hedge fund trader George Soros said that gold prices might continue to rise, but warned that that gold is the "ultimate bubble."

Sinai Says Fed's Sept. 21 Statement Means 'Gotta Buy Gold'
By Joshua Zumbrun and Tom Keene
Sept. 22 (Bloomberg) -- The Federal Reserve's statement yesterday that inflation is below levels consistent with the central bank's mandate for price stability means it's time to buy gold, said Allen Sinai, chief global economist at Decision Economics Inc. in New York.
"That's code for we don't want to go the way of Japan so we're going to print money," Sinai said in a radio interview today on "Bloomberg Surveillance" with Tom Keene. "You gotta buy gold when those two central banks are doing what they're doing."

No end to gold's surging price ahead?
With gold having come within spitting distance of $1300 so far this week, year-end targets are again being revised upwards.
Author: Lawrence Williams - Mineweb.com
DENVER - Gold has been continuing its recent price pattern this week - moving up, consolidating, moving up again and reaching new highs on each upwards step. Markets are a little fickle, but there does seem to be a certain momentum developing which, on the current pattern will push the yellow metal through $1300 and then perhaps go on much higher. As long as continuing doubts remain about the true state of the global economy, and about the moves being made to try to stop major economies descending into depression, which tend to be gold positive, one can see little reason why this pattern should not continue.

Who Are the Experts on Gold?
by Gary North - LewRockwell.com
The experts on gold are the people who publicly recommended that investors purchase gold when gold was under $300. They recommended that people purchase gold when gold was at $300, $400, $500, $600, $700, $800, $900, $1000, $1100, and, finally, $1200.
The non-experts on gold are the people who never told investors to invest in gold at any price, and who are now saying that gold is going to decline in price, and therefore it is not a good investment.
I have personally monitored the gold market ever since 1963. I guess you would call me an old hand in the gold market. I have seen gold bugs come and go, and I have seen gold haters come and go. I have seen many arguments in favor of gold, and I have seen many arguments against gold.

Deflation fears drive up gold prices
By John Waggoner, USA TODAY
Gold shot up $17.80 Wednesday, to an all-time high of $1,290.50 an ounce for October delivery, driven by weakness in the value of the U.S. dollar.
Investors often rush to precious metals when they're worried about the value of paper money. Normally, that means inflation fears.
But inflation is dead. The consumer price index, the government's main gauge of inflation, has risen just 1.1% since August 2009. Bond traders, who usually demand higher yields to compensate for inflation, have driven down the yield of the two-year Treasury note to 0.43%, near a record low.

Gold Prices Hit Record High Following Fed Meeting
By HUGH COLLINS - DailyFinance.com
Gold prices jumped to record highs Wednesday, a day after the Federal Reserve's latest policy meeting.
The price of bullion reached a new record of $1,294.95 an ounce, before slipping to $1,293.10 an ounce, Reuters reported.
The Fed's statement Tuesday that it is "prepared to provide additional accommodation if needed," was interpreted by some analysts as a willingness to engage in additional monetary stimulus.

Gold Prices Still Far From Real Record Highs
by Cullen Roche - SeekingAlpha.com
The chatter of a bubble in gold is gaining more and more momentum and while I believe there is a high probability of an irrational bubble forming in gold we are still far from being in bubble territory. If you consider gold in real terms we're still 91% from the all-time highs (via Bloomberg):
The CHART OF THE DAY shows the gold price relative to January 1980, when the metal reached $873 an ounce. Yesterday's record close in New York trading equals $454.88 an ounce in real terms, reflecting an increase in the U.S. consumer price index, according to data compiled by Bloomberg.

Gold ready to touch $1,300/ounce
LONDON (Commodity Online): Gold is just kissing distance from $1300 per ounce as the dollar sank after the US Federal Reserve hinted at more stimulus spending if the tepid US economic recovery cools further.
The yellow metal jumped to $1,293.35 an ounce on Wednesday at the London Bullion Market, after breaching $1,290 dollars on Tuesday.
A combination of a weakening dollar and the Federal Reserve indicating it may loosen monetary policy further is pushing gold to record highs.
While some are calling for it to run out of steam around the $1,300 level, the momentum still clearly remains to the upside.

Make or Break Time for Silver
by MadHedgeFundTrader - ZeroHedge.com
Those who took my advice to load up on silver a month ago are laughing all the way to the bank. The white metal outperformed gold better than 1.6:1 ratio that I predicted. Silver is now trading at a 30 year high, is overbought, and bumping up against key technical resistance.
Unsurprisingly, I have been flooded by emails from readers asking what to do next. Short term traders, those in the futures markets, and anyone using a degree of leverage should take the money and run. As I have pointed out with my hugely successful agricultural trades this summer (corn, wheat, sugar, coffee, soybeans), we now live in a zero return world, and the 13% gain silver has posted since August 23 puts you way ahead of the pack. Mean reversion can be such a bitch that it makes your ex wives appear like a convent full of nuns.

Dollar Near Five-Month Low Before Housing Report; Kiwi Weakens
By Ron Harui
Sept. 23 (Bloomberg) -- The dollar traded near a five-month low against the euro before a U.S. report today that may show existing home sales were close to a 10-year low, adding to signs the world's largest economy is struggling to recover.
The greenback was within half a yen of a one-week low versus Japan's currency before separate data in the coming week that economists said will show durable goods orders fell and consumer confidence declined, backing the case for the Federal Reserve to keep interest rates near zero. New Zealand's dollar fell the most in a week after the government said the economy expanded at a slower pace than economists forecast.

Bernanke Lied to Us
TraderMark - SeekingAlpha.com
I have to change my viewpoint on the market (not the economy) due to Ben's act of lying. Just 3 weeks ago at Jackson Hole he implied there needed to be material drop in economic activity for the Fed to consider additional policy responses.
So what had changed since that meeting? While the economic data was not great, it did not degrade in any significant manner ... in fact that (along with the promise of QE #2) was the tenet on why the stock market was rallying, right? Things were not getting worse? Double dip off the table? Yet 3 weeks later he basically hands the market a bouquet saying QE2 is coming? Just an outright lie from this seat.

Bernanke Drops the Ball Again
Rob Parenteau - SilverBearCafe.com
Fed Chairman Ben Bernanke's remarks to the Economic Symposium in Jackson Hole, Wyoming:

Notwithstanding some important steps forward, however, as we return once again to Jackson Hole I think we would all agree that, for much of the world, the task of economic recovery and repair remains far from complete... Central bankers alone cannot solve the world's economic problems.

Had the chairman stopped right there, not just for dramatic pause, but for good, and dramatically stepped down from the podium, boldly walking off stage in front of his brethren from the world's monetary policy elite, he would have qualified for a Cuban cigar, a Nobel Prize and an early all-expense-paid retirement. Not necessarily in that order, but you get the picture.

Tale Of The TARP Two Years Later
How The Elite Media Perpetuated The Lies
Dean Baker - SilverBearCafe.com
Two years ago, the top honchos at the Fed, Treasury and the Wall Street banks were running around like Chicken Little warning that the world was about to end. This fear mongering, together with a big assist from the elite media (i.e. NPR, the Washington Post, the Wall Street Journal, etc.), earned the banks their $700 billion TARP blank check bailout. This money, along with even more valuable loans and loan guarantees from the Fed and FDIC, enabled them to survive the crisis they had created. As a result, the big banks are bigger and more profitable than ever.
Now, the same crew that tapped our pockets two years ago is eagerly pitching the line that their bailout was good for us. It may be the case the history books are written by the winners, but that doesn't prevent the rest of us from telling the truth.

Fed Gunning for Inflation
By DAVID REILLY - WSJ.com (free)
Ben Bernanke has loaded the gun. But the prospect of another round of the balance-sheet expansion through quantitative easing raises the specter of the Federal Reserve going into even more uncharted territory.
First, the Fed's statement that "inflation is likely to remain subdued for some time before rising to levels the committee considers consistent with its mandate" gave a clearer picture that the central bank's aim right now is the promotion of inflation.

Geithner Backs New Finance Rules, Extended Tax Cuts, to U.S. Lawmakers
By DANNY KING - DailyFinance.com
International banking regulations agreed upon in Basel, Switzerland, last week will reduce the probability of a future financial meltdown, U.S. Treasury Secretary Timothy Geithner said before the House Financial Services Committee today.
The so-called Basel III rules will, among other things, require banks to more than triple the percentage of equity held against risk-weighted assets, said Geithner. The Treasury secretary also argued that tax breaks for the middle class and small businesses should be extended, though he was noncommittal about extending George W. Bush's tax cuts for the wealthiest U.S. citizens beyond this year. He was also vague on when a chair for the newly created Consumer Financial Protection Bureau would be nominated or named.

Geithner confident U.S. banks can meet new global capital standards
By Martin Crutsinger, Associated Press - USAToday.com
WASHINGTON - Treasury Secretary Timothy Geithner said Wednesday that U.S. banks are in a good position to meet new global capital standards because of the stress tests conducted in the United States last year.
In testimony to the House Financial Services Committee, Geithner praised the new global rules on capital adopted at a meeting earlier this month in Basel, Switzerland.

Obama, Warren and The Imperial Presidency
The Senate should vote on all senior appointments within 60 days. But the president should give it a chance to vote.
By BRUCE ACKERMAN - WSJ.com (free)
President Obama's appointment of Elizabeth Warren late last week is another milestone down the path toward an imperial presidency. During America's first 150 years, Ms. Warren's appointment as a special adviser to the White House would have been unthinkable. Today, it's par for the course.
Only in 1939 did Franklin Roosevelt win the right to appoint six "special assistants." To gain congressional approval, he pledged that his assistants would act strictly as advisers. Thus they did not require Senate confirmation.

Warren Will 'Reach Out' to Banks, Review Credit Cards

Summers Stature Will Make Replacing Him a Tough Task
By Hans Nichols
Sept. 22 (Bloomberg) -- For all of Lawrence Summers's drawbacks, a strong-willed and intellectual economist who critics say is difficult to work with, President Barack Obama faces a tough task in finding a replacement with the stature of the departing director of the National Economic Council.
Summers will return to Harvard University, where he has served as president and is a professor on a two-year leave, by the end of the year, the White House said yesterday. He will leave the economic team at a time when the nation is still recovering from the worst recession since the 1930s, and following elections in which the president's party faces the possible loss of control of the House and perhaps the Senate.

Two of Obama's closest advisers among those likely to leave in White House shuffle
By Anne E. Kornblut and Scott Wilson - Washington Post Staff Writers
In his nearly two years in office, President Obama has relied on a very small clique of advisers that serves as his most trusted sounding board on politics and policy.
Members of his staff describe Obama as wary of outsiders and reluctant to widen his inner circle. As one of his advisers bluntly put it, the president "doesn't like new people."
Like it or not, he will soon be surrounded by them as an expected staff shuffle will deprive Obama of two of his closest aides and an influx of replacements will take their places within the West Wing.

New chief of staff would let Obama reset White House tone
If Rahm Emanuel resigns to run for Chicago mayor, as expected, the president would get a chance to reconfigure the White House staff - and signal how he intends to govern for the next two years.
By Peter Nicholas, Tribune Washington Bureau
Reporting from Washington - President Obama may soon make one of the most fateful personnel decisions of his tenure, naming a new chief of staff whose job will be to help revive a presidency battered by the weak economy and a Republican resurgence.
Rahm Emanuel, who now holds the position, is expected to resign soon to run for mayor of Chicago, giving Obama a chance to reconfigure a White House team that has seen little high-level turnover.

Emanuel Likely to Leave White House for Mayoral Bid
By Julianna Goldman and John McCormick
Sept. 22 (Bloomberg) -- Rahm Emanuel, President Barack Obama's chief of staff, is likely to leave the White House before the November congressional elections to run for mayor of Chicago, people familiar with the matter said.
Emanuel, who would be seeking to replace Chicago Mayor Richard M. Daley, could depart by early October, after Congress leaves for recess to campaign for the midterm elections, the people said on condition of anonymity. One person close to Emanuel said a final decision hasn't been made. Obama is "not aware that he's made any decisions" about leaving to run for mayor, White House press secretary Robert Gibbs told reporters traveling with the president to New York today.

Treasury's Herbert Allison Becomes Latest Economic Official To Go
By JONATHAN BERR - DailyFinance.com
When Herbert Allison was named to oversee the government's $700 billion bank bailout in 2008, Scott Talbott, chief lobbyist for the Financial Services Roundtable, hailed him for his "wealth of experience with buying, selling, protecting, and managing assets to protect the taxpayer investment and strengthen the economy." That may have been true, but it looks like it wasn't enough to prolong his career in government service.
According to CNBC, Allison, Assistant Secretary of the Treasury for Financial Stability, is the latest member of the Obama economic to leave ahead of what many expect to be crushing losses for the Democrats in November. Lawrence Summers tendered his resignation as chairman of National Economic Council yesterday, saying that he wanted to return to Harvard University where he had previously been president. Office of Management and Budget Peter Orzag and Christina Romer, chair of the Council of Economic Advisors, have also recently quit. Treasury Secretary Timothy Geithner is the last member of President Barack Obama's cadre of economic experts left and his tenure seems to be on increasingly shaky ground.

FOMC statement, Pres. Obama's CNBC town hall

Differing views on bailout emerge as manager of TARP fund resigns
Herbert Allison joins the Obama administration in calling the $700-billion program a success. Critics say its losses, though less than feared, are still too large and that it failed to achieve its original goal. - By Jim Puzzanghera, Los Angeles Times
Reporting from Washington - As one of the most controversial chapters in U.S. economic history draws to a close, the Obama administration and its critics are writing very different obituaries of the $700-billion fund that bailed out Wall Street and the domestic auto industry.
Treasury Secretary Timothy F. Geithner said the much-maligned Troubled Asset Relief Program "succeeded in ways that none of us could have imagined." And Herbert M. Allison Jr., who resigned Wednesday as TARP's head, said the fund laid the foundation for the nation's recovery - "at a fraction of the cost that was originally anticipated."

SEC Blasted on Goldman
Suit's Timing 'Suspicious,' Watchdog Says; Heat on Agencies as Crisis Cases Lag
By KARA SCANNELL, LIZ RAPPAPORT And THOMAS CATAN
WASHINGTON - The Securities and Exchange Commission's internal watchdog said the timing of a fraud lawsuit against Goldman Sachs Group Inc. filed by the SEC was "suspicious," suggesting agency officials tried to distract attention from a report criticizing the SEC for failing to detect an alleged Ponzi scheme.
Republican lawmakers asked SEC Inspector General H. David Kotz earlier this year to investigate how the SEC decided to file its April suit against Goldman, which settled the case in July for $550 million. The federal lawsuit alleged wrongdoing in a sale of mortgage securities called Abacus 2007 AC-1, and was filed as Senate Democrats were taking up the financial-regulation bill.

Seattle Bank unit faces California class-action suit
PUGET SOUND BUSINESS JOURNAL (SEATTLE) - BY Kelly Gilblom
The Seattle Mortgage Co., a unit of Seattle Bank, has been hit with a lawsuit in California that claims illegal activities in its lending practices involving senior citizens.
The lawsuit, intended to be a class action, claims the mortgage company was illegally paying fees to its mortgage brokers and overcharging borrowers on the cost of loan origination. Though no exact dollar figure has been sought in reimbursement costs and damages, claims would likely total about $56 million, the lead attorney for the plaintiff said.

Treasury 10-Year Yield Is Near Three-Week Low Before Home Sales
By Wes Goodman
Sept. 23 (Bloomberg) -- Treasury 10-year yields were near a three-week low before an industry report that economists said will show sales of existing homes in the U.S. remain muted.
Two-year yields were within three basis points of a record low as some investors said economic growth is slow enough that the Federal Reserve will increase Treasury purchases as soon as its November meeting to help keep borrowing costs low. The Treasury Department is scheduled to announce today the sizes of two-, five- and seven-year note sales scheduled for next week.

The Emerging Global Fed
Alex Newman - SilverBearCafe.com

(Editor's Note: The Federal Reserve is a bought and paid for group of stooges that act as a tool of the most evil individuals to ever inhabit the Earth. Bob Chapman and I agree, the evil individuals are the illuminati. The illuminati is made up, exclusively, of devil worshipers. If you are not aware of that fact, it is because you are a lazy putz who has not done your homework. They already control the banking system and all facets of our government and, If not stopped, they will become the slave masters of your children and your children's children. The world is full of morons that want to burn Korans (or Bibles). How about a campaign to burn central bankers? - JSB)

The Federal Reserve has been a nightmare for the American people. It inflates the money supply, thereby devaluing already-existing money and placing a massive hidden tax on the people via rising prices. It also uses its monopoly power to cause interest rates to go up or down, usurping the rightful place of the market and causing massive malinvestment and generally an improper and unproductive allocation of resources.

Wen Says Structure, Not Yuan, Causes Trade Surplus
By Ye Xie
Sept. 22 (Bloomberg) -- Chinese Premier Wen Jiabao said the yuan's value isn't causing the U.S. trade deficit with his country, rejecting President Barack Obama's assessment that China is keeping the currency cheap to aid exports.
"The main cause of the U.S. trade deficit is not the exchange rate of the Chinese currency, but the structure of investment and savings," Wen said at a meeting with U.S. business leaders including Goldman Sachs Group Inc. Chief Executive Officer Lloyd Blankfein in New York today. "There's a trade imbalance between the U.S. and China, which is not something we want to see. China doesn't pursue a trade surplus intentionally."

Pelosi Urges Action on China Currency as Panel Considers Measure
By Mark Drajem and James Rowley
Sept. 23 (Bloomberg) -- House Democratic leaders began a final pre-election push for legislation that would authorize trade sanctions against China if the nation's currency remains undervalued.
"It is time for Congress to pass legislation that will give the administration leverage in its bilateral and multilateral negotiations with the Chinese government -- so that U.S. businesses and workers have a more level playing field in world trade," House Speaker Nancy Pelosi said yesterday in a statement, as the Ways and Means Committee set a session for tomorrow to draft the legislation.

Bill combating China currency to advance
By Howard Schneider - Washington Post Staff Writer
House leaders are moving forward with legislation to combat China's currency policies, adding to pressure from the Obama administration and giving lawmakers an election-year chance to vote on a sensitive trade matter.
The House Ways and Means Committee plans to vote Friday on a bill that would expand the Commerce Department's power to impose duties on Chinese imports in response to that country's currency being undervalued on world markets.

Chinese PM Pushes Back as U.S. Currency Bill Looms
By REUTERS - NYTimes.com
NEW YORK/WASHINGTON (Reuters) - Chinese Premier Wen Jiabao pushed back on Wednesday against U.S. pressure to revalue the yuan, as U.S. lawmakers threatened to penalize China for keeping its currency artificially low.
Wen, who is due to meet U.S. President Barack Obama in New York on Thursday during the U.N. General Assembly, said in a speech to U.S. business leaders the yuan exchange rate had no relation to U.S. trade deficits and should not be politicized.

U.S. presses for fewer Western Europeans on the IMF board
By Howard Schneider - Washington Post Staff Writer
The Obama administration has launched a battle to cut the number of Western Europeans on the board of the International Monetary Fund and make room for more representatives from developing countries.
Taking on a cluster of small nations such as Belgium and the Netherlands, the administration has threatened to to let the board dissolve unless the Europeans give up two or three of the nine seats they hold. The U.S. appointee to the IMF board, Meg Lundsager, in August blocked a vote needed for new board elections, part of an effort to redistribute power within the IMF and, the administration says, sustain the agency's credibility in newly influential parts of the world.

Central Banks Still Stuck in Crisis Mode as Recovery Weakens
By Scott Lanman and Jana Randow
Sept. 23 (Bloomberg) -- The world's major central banks are having a tough time exiting crisis mode, prolonging aid or raising the prospect of reviving unconventional stimulus tools as the global recovery loses momentum.
The U.S. Federal Reserve said Sept. 21 it's prepared to ease monetary policy further if needed and has highlighted asset purchases as an option. The Bank of England yesterday signaled policy makers are moving closer to adding stimulus. The European Central Bank extended liquidity support for banks into 2011 on Sept. 2.

Banking System Collpase, on the Edge of The Precipice, Basel III
By: Matthias Chang - MarketOracle.co.uk
The Global Too Big To Fail Banks are so precarious that literally anything can trigger a collapse in the coming months.
I have read recent commentaries on Basel III posted to various renowned websites and financial publication, but they missed (or deliberately misled) the underlying message of the proposals, the implementation of which will be delayed till 2017 and some till 2019.
Basel III is pure spin and its timing was to assuage the deep-seated fears that there are no solutions in sight to save the fiat money system and fractional reserve banking.

Hooray, the Recession Is Over!
Mises Daily: by Robert P. Murphy
Some days, it's embarrassing to be a professional economist. On Monday, the National Bureau of Economic Research (NBER) officially declared that our recession had ended - 15 months ago. Yes, that's right, just as more and more analysts are worried about the economy imploding again, the NBER announces that the recession ended back in June 2009. The whole episode underscores the crudity of mainstream economics.

Blockbuster plans to file Chapter 11 bankruptcy
By David Lieberman, USA TODAY
Hundreds of communities may soon lose their local video stores. Blockbuster - the company that helped to turn movie renting into a national pastime - is set to file for Chapter 11 bankruptcy protection today, Bloomberg News reports, citing an unnamed person who knows about the plan.
Blockbuster declined to comment.
A filing would come about a month before the 25th anniversary of the opening of Blockbuster's first store, in Dallas. " 'End of an era' summarizes it neatly," says John Tinker, senior media analyst at Maxim Group, a brokerage firm.

Home video biz has become 'quite baffling to consumers'
By David Lieberman, USA TODAY
Apple CEO Steve Jobs sang a familiar tune this month when he described a big selling point for his newly revamped Apple TV. The device, which connects TV sets to the Internet, will make it "really simple" for people to rent movies on demand, he said.
Maybe it will be simple. But the cascade of new products, policies and pricing schemes for watching movies at home is making one of the USA's most popular pastimes "quite baffling to consumers," says Tom Adams, president of research firm Screen Digest.

Gerald Celente on The Gary Null show 20 Sept 2010

Tax credit bonanza for small businesses
By Catherine Clifford, - CNN.com
NEW YORK (CNNMoney.com) -- Across the country, small businesses are talking to their accountants about a hefty tax credit that could make health insurance a little more affordable.
Six months after sweeping health care reform was enacted, the cost of health insurance remains one of the most pressing issues facing small businesses. Premiums typically run 18% higher for small businesses than for larger companies.
The health care law called for the expansion of state-run exchanges aimed at helping small businesses find affordable coverage. But not until 2014. To bridge the gap, the law also established a slew of significant tax credits to small firms starting this year.

Big sales from tiny shops
In kiosks, trucks and other teeny spaces, entrepreneurs with big dreams but little money are shaking up the retail scene.

1. A restaurant on wheels; Chris' Little Chicago - Austin
2. A small island in a big mall; Mama Always Said - Lone Tree, Colo.
3. Eggs, veggies and architectural advice; J Arthur Design - Seattle
4. A tiny spot off the beaten path; The Little Soap Shop - Astoria, New York
5. Ephemeral shops in empty spaces; Holiday pop-up shops, Portland, Ore.

Good News for Housing: 30-Year Fixed Rate Mortgages at Their Lowest Point in History
Calafia Beach Pundit - SeekingAlpha.com
Thanks to 2.5% yields on 10-yr Treasuries and the ongoing improvement in the efficiency and liquidity of the mortgage-backed securities market (which has resulted in a tightening of the spread between conforming and jumbo rates), homebuyers today can take advantage of the lowest 30-yr fixed-rate mortgages in history, whether for a conforming or a jumbo loan.
One reason rates are so low is that demand for mortgage loans is also relatively low, as reflected in the above chart, which shows a measure of all mortgage applications for the purchase of a single-family home. The volume of new mortgage applications has fallen significantly since the peak of the housing market in 2005, but I note that the current volume is still higher than pre-1997 levels. Things have really cooled off, but they haven't ground to a halt by any means.

U.S. house prices lowest in nearly six years
Prices fall 0.5% in July, and June price drop revised to 1.2%
By Steve Goldstein, MarketWatch
WASHINGTON (MarketWatch) - U.S. house prices fell 0.5% in July to the lowest level in nearly six years, according to data released Wednesday by the Federal Housing Finance Agency.
The 0.5% seasonally adjusted drop in monthly prices came after a 1.2% drop in June; the FHFA initially reported that June prices slipped 0.3%.
Over 12 months, prices are down 3.3%. The FHFA said that the July index is roughly the same value as was seen in September 2004.

Ally Financial legal issue with foreclosures may affect other mortgage companies
By Ariana Eunjung Cha - Washington Post Staff Writer
Some of the nation's largest mortgage companies used a single document processor who said he signed off on foreclosures without having read the paperwork - an admission that may open the door for homeowners across the country to challenge foreclosure proceedings.
The legal predicament compelled Ally Financial, the nation's fourth-largest home lender, to halt evictions of homeowners in 23 states this week. Now it appears hundreds of other companies, including mortgage giants Fannie Mae and Freddie Mac, may also be affected because they use Ally to service their loans.

Amid mountain of paperwork, shortcuts and forgeries mar foreclosure process
Ariana Eunjung Cha and Brady Dennis - WashingtonPost.com
The nation's overburdened foreclosure system is riddled with faked documents, forged signatures and lenders who take shortcuts reviewing borrower's files, according to court documents and interviews with attorneys, housing advocates and company officials.
The problems, which are so widespread that some judges approving the foreclosures ignore them, are coming to light after Ally Financial, the country's fourth-biggest mortgage lender, halted home evictions in 23 states this week.

Foreclosures comprise nearly 50 percent
of Phoenix existing-home activity
NationalMortgageProfessional
Two negative trends are currently clouding the Phoenix, Ariz. area housing market, according to a new report from the W. P. Carey School of Business at Arizona State University. August marked the third consecutive month that the median existing-home price dropped in the Valley. Also, foreclosures made up their highest percentage of existing-home activity since back in January.
"Foreclosures accounted for 45 percent of the existing home market activity in August," said Associate Professor of Real Estate Jay Butler, who authored the report. "When you add in resales of previously foreclosed-on homes, all of this foreclosure-related activity represents a full two-thirds of the market's transactions in August."

More than half seeking mortgage-relief have fallen out of program
By Alan Zibel, Associated Press - USAToday.com
WASHINGTON - The Obama administration's flagship mortgage-relief effort is failing to ease the foreclosure crisis as more than half of those who have enrolled have fallen out of the program.
As of August, approximately 680,000 homeowners who applied to get their mortgage payments lowered, or about 51%, have been disqualified, the Treasury Department said Wednesday. That's up from about 48% in July.
The report gives ammunition to critics who say the program has failed to slow the tide of foreclosures. They say it's better to let troubled homeowners lose their homes and home prices fall.

Man's home sold out from under him in foreclosure mistake
By Harriet Johnson Brackey - South Florida Sun-Sentinal
When Jason Grodensky bought his modest Fort Lauderdale home last December, he paid cash. But seven months later, he was surprised to learn that Bank of America had foreclosed on the house, even though Grodensky did not have a mortgage.
Grodensky knew nothing about the foreclosure until July, when he learned that the title to his home had been transferred to a government-backed lender. "I feel like I'm hanging in the wind and I'm scared to death," said Grodensky. "How did some attorney put through a foreclosure illegally?"

GMAC Foreclosures Drew Earlier Sanctions for 'False Testimony'
By Dakin Campbell and Lorraine Woellert
Sept. 22 (Bloomberg) -- Ally Financial Inc.'s GMAC Mortgage unit, which halted evictions in 23 states last week after finding employees didn't verify foreclosure documents, was sanctioned in 2006 for similar practices, court documents show.
GMAC gave "false testimony" when it justified foreclosures by submitting sworn affidavits signed by a mortgage executive who later said in a deposition she didn't actually review the loan documents or sign in the presence of a notary, according to a 2006 court order filed in Duval County, Florida. In response to the sanctions, GMAC Mortgage directed employees to "read and fully understand" court documents before signing.

Saving Americans Requires Sticking It to Them
Commentary by Jonathan Weil
Sept. 23 (Bloomberg) -- The banks were saved by the American people. Now who will save the people from the banks?
Last week, in a rare and possibly fleeting victory for the little guy, Ally Financial Inc.'s mortgage-servicing unit temporarily halted evictions tied to foreclosures in 23 states. This came after some attorneys for homeowners caught the company saying things that weren't true in its court filings.

Housing Starts and the Unemployment Rate
by CalculatedRisk
.... Usually near the end of a recession, residential investment1 (RI) picks up as the Fed lowers interest rates. This leads to job creation and also household formation - and that leads to even more demand for housing units - and more jobs, and more households - a virtuous cycle that usually helps the economy recover.
However this time, with the huge overhang of existing housing units, this key sector isn't participating. So in this recovery there is less job creation, less household formation, and less demand for housing units than in a normal recovery. This is sort of a circular trap for both GDP growth and employment that will persist until the excess housing units are absorbed.

Wal-Mart's CEO Provides The Starkest Visual Of The Modern Bread Line Yet Submitted by Tyler Durden - ZeroHedge.com
In today's Art Cashin Comments there is a stunning admission by none other than the CEO of Walmart on what modern day bread lines look like. To wit: Profits And Baby Formula - Our pal, Rich Yamarone, over at Bloomberg picked up an eye-opening statement made by the Wal-Mart CEO last week.

I don't need to tell you that our customer remains challengedÉYou need not go farther than one of our stores on midnight at the end of the month. And it's real interesting to watch, about 11 p.m. customers start to come in and shop, fill their grocery basket with basic items - baby formula, milk, bread, eggs - and continue to shop and mill about the store until midnight when government electronic benefits cards get activated, and then the checkout starts and occurs. And our sales for those first few hours on the first of the month are substantially and significantly higher.

D.C. woman is evicted, and with her, 30,000 pounds of belongings
By Theresa Vargas - Washington Post Staff Writer
Evicted, Eloisa Diaz stood on Otis Place NW on Wednesday, her financial struggles and habit of collecting household goods - enough to crowd four street corners - exposed for all to see.
Evictions happen every day, more so during a recession that has pushed unemployment and foreclosures to historic highs. But few evictions create such a dramatic scene: jumbled mounds of goods, more than could be carted away by three moving trucks, each able to carry more than 10,000 pounds.

Obama Steps Up Defense of Health-Care Overhaul Law
By Nicholas Johnston
Sept. 22 (Bloomberg) -- President Barack Obama said politicians who want to repeal this year's health-care overhaul should have to explain to people who need insurance that they won't be able to buy it.
"I want them to look you in the eye and say sorry," he said, "you can't buy health insurance."
"I don't think that's what this country stands for," the president said at a backyard gathering today in Falls Church, Virginia.

*****

How Seniors Will Pay for ObamaCare
In many areas, Medicare Advantage enrollees will lose about one-third of their health insurance benefits. The cuts will finance new subsidies for younger people.
By JOHN C. GOODMAN - WSJ.com - $$
Today marks the six-month anniversary of the enactment of the Patient Protection and Affordable Care Act, widely known as ObamaCare. It is a day when the first significant round of benefits kicks in, and the Obama administration is taking every opportunity to tout them to the American public.
Insurers, we are being told, will no longer be able to impose annual limits or lifetime caps on benefits, and they will face a higher standard before than can drop anyone's coverage. Children will be guaranteed access to insurance, regardless of health condition. And there is more to come in the future.
[note: if you don't have a paid subscription, copy the title and paste into Google; then click on the link and you will be able to read the entire article]

GM must sell for $134 a share for U.S. to recover investment
By Peter Whoriskey - Washington Post Staff Writer
In order for the United States to recoup all of its $50 billion investment in General Motors, it must sell its ownership stake at $134 a share, according to the special inspector general of the government's bailout programs.
The estimate comes as the automaker readies itself for a public stock offering, setting the stage for the government to withdraw from its majority stake in the company.
The price needed for a full recovery of the U.S. investment is far higher than shares of the automaker have ever reached, and some analysts and government officials have expressed doubts that the United States will be able to recover the money.

GOP's 'Pledge to America' lays out a governing agenda
By Deirdre Walsh and Dana Bash, CNN
Washington (CNN) -- House Republican leaders will unveil a 21-page "Pledge to America" on Thursday that presents a "governing agenda" for what Republicans would do if they win control of Congress in November.
CNN obtained a copy of the document Wednesday.
The plan focuses primarily on jobs and the economy, with a short reference in the "preamble" to the party's position on social issues.

Senate Democrats may abandon plans for showdown on tax cuts
By Lori Montgomery - Washington Post Staff Writer
Senate Democrats are considering abandoning plans for a preelection showdown with Republicans over expiring tax breaks for the wealthy, saying a lack of consensus within the party and a desire to focus on job creation may delay a vote until after the November elections.
Instead of spending their time tussling over income tax rates, some Senate Democrats are pressing their leaders to stage a debate over companies that ship jobs overseas, an issue that proved politically potent in a Pennsylvania special election this year. With unemployment at 9.6 percent, these Democrats say a measure to create jobs would speak more directly to the concerns of voters anxious about the economy.

Boeing wins Pentagon contract to build a solar-powered drone that can stay aloft for five years
-- W.J. Hennigan - LATimes.com
With four scrawny fuselages and wings stretching more than the length of a football field, Boeing Co.'s solar-powered drone looks a bit like a flying antenna.
But the government is hoping that the aircraft, dubbed the SolarEagle, will one day be capable of flying for five straight years at 60,000 feet.
Last week, Boeing announced it had won an $89-million contract with the U.S. Defense Advanced Research Projects Agency to develop a prototype of the SolarEagle that can demonstrate it can stay aloft for 30 days by 2014. Eventually, Chicago-based Boeing sees the SolarEagle hovering at stratospheric altitudes for at least five years.

Unsustainable cow manure
Paul Driessen - SilverBearCafe.com
Seek a sustainable future! Wind, solar and bio-fuels will ensure an eco-friendly, climate-protecting, planet-saving, sustainable inheritance for our children. Or so we are told by activists and politicians intent on enacting new renewable energy standards, mandates and subsidies during a lame duck session. It may be useful to address some basic issues, before going further down the road to Renewable Utopia.
First, when exactly is something not sustainable? When known deposits (proven reserves) may be depleted in ten years? 50? 100? What if looming depletion results from government policies that forbid access to lands that might contain new deposits - as with US onshore and offshore prospects for oil, gas, coal, uranium, rare earth minerals and other vital resources?

A Return to Feudalism?
by Lynn Swearingen - PPJ Gazette
The Recession has been over for 14 months, Housing Starts are up 10.5% in August, and all around everything is just "less bad". Of course the President has relayed this information to us on the same day that he attempted to pay $1 for 4 apples in a Philadelphia Farmers Market.
If ever there was a more fitting example of the return to the Landowner/Serf relationship as in the above NPR article, I'd like to see it.

On Doing Economic History | Thomas E. Woods, Jr.

Hillary to CFR:
Unilateralism Lite for a New American Moment
by Webster G. Tarpley
Secretary of State Hillary Clinton's address to Wall Street bigwigs of the Council on Foreign Relations in New York City on the eve of this year's session of the United Nations General Assembly documents the startling degree to which the mental processes of the US ruling elite have become disconnected from world reality. Hillary's Leitmotiv in this speech was a constant harping on the reality and imperative necessity of US world leadership, which she claimed had opened the immediate perspective for a "New American Moment" on her watch. To this extent, she sounded very much like any neocon of the Bush-Cheney era. But Hillary did offer some slight variations on the usual note of triumphalism, which of course goes back to Madeleine Albright's slogan of the United States as the "indispensable nation." Hillary's unilateralism comes dished up in a slightly more appealing camouflage than was the case with the neocon plug-uglies. The current US line under Obama can therefore be described as unilateralism in disguise, unilateralism in drag, or unilateralism lite.

Clinton spewing rhetoric, arrogance and hypocrisy

Police State America
Vox Day - SilverBearCafe.com
Authority has always attracted the lowest elements in the human race. All through history mankind has been bullied by scum. Those who lord it over their fellows and toss commands in every direction and would boss the grass in the meadow about which way to bend in the wind are the most depraved kind of prostitutes. - P.J. O'Rourke, "A Parliament of Whores"
Americans have long been accustomed to respect the police according to the Norman Rockwell portrait of the friendly, small-town peacekeeper. But those days have been gone for decades as the helpful revolver-carrying policeman of yore has been gradually replaced by a steroid-abusing, paramilitarized bully in black body armor with a bad attitude. Driven by an insatiable demand for revenue on the part of state and local governments, the police forces of America have been pillaging American private property like vandals sacking Rome; millions of dollars worth of private property has been seized without warrant and without any charges being filed under the cover of the drug war.

Feds: Privacy Does Not Exist in 'Public Places'
By David Kravets - Wired.com
The Obama administration has urged a federal appeals court to allow the government, without a court warrant, to affix GPS devices on suspects' vehicles to track their every move.
The Justice Department is demanding a federal appeals court rehear a case in which it reversed the conviction and life sentence of a cocaine dealer whose vehicle was tracked via GPS for a month, without a court warrant. The authorities then obtained warrants to search and find drugs in the locations where defendant Antoine Jones had travelled.
The administration, in urging the full U.S. Court of Appeals for the District of Columbia to reverse a three-judge panel's August ruling from the same court, said Monday that Americans should expect no privacy while in public.

T-Mobile Claims Right to Censor Text Messages
By David Kravets - Wired.com
T-Mobile told a federal judge Wednesday it may pick and choose which text messages to deliver on its network in a case weighing whether wireless carriers have the same "must carry" obligations as wire-line telephone providers.
The Bellevue, Washington-based wireless service is being sued by a texting service claiming T-Mobile stopped servicing its "short code" clients after it signed up a California medical marijuana dispensary. In a court filing, T-Mobile said it had the right to pre-approve EZ Texting's clientele, which it said the New York-based texting service failed to submit for approval.

The Art Of The Bug-Out Bag
By Giordano Bruno
Neithercorp Press - 09/22/2010
The bug-out-bag is probably the most clichŽd emergency preparation in the history of survivaldom. Some people focus so much on compiling their BOB that they lose track of much more important survival matters, while others are so biased against the 'bug out' concept that they refuse to even consider putting one together. In the world of survival research, preppers sometimes position themselves on the far ends of the opinion spectrum. To be sure, some strategies simply do not work and will never work, and to be uncompromising in those instances is reasonable, especially when you are dealing with such extremes as economic collapse. However, in my endless war against 'assumption', I would point out that rigidity in thinking often leads to tragedy for those in the midst of a social breakdown. Adaptability is the key to survival, and because of this, we cannot discount certain options out of hand.

Development Goals Uncertain; Would Leave Almost 1 Billion People Below $1.25 per Day - Webster G. Tarpley
As the UN General Assembly gathers in New York, world attention focuses on the tragic dysfunctionality of the UN institution and its major components, especially the International Monetary Fund and the World Bank. On the one hand, the end of the Cold War has left the United States (along with the NATO states Britain and France) in a position of dominance within the Security Council which has been systematically abused, first for the unprovoked aggression against Iraq, and now for the buildup of a strike against Iran, as well as for economic sanctions and economic warfare against these and other states on the US hit list. Of the major flashpoints of world conflict which were evident 60 years ago, the Security Council has ratified the solution of only one, Germany, while Israel-Palestine, Kashmir, and the Korean peninsula are time bombs which continue to tick. Worse, new conflict zones are materializing around Iran and the territorial disputes of the South China Sea, in which the Obama regime appears determined to meddle. The Security Council in turn has reduced the General Assembly to a shadowy irrelevance, depriving more than 190 countries of a legitimate voice. This is not a good record.

Tarpley: 'Globalization is failing'

Canada's government loses bid to end gun registry
BBC.co.uk
Conservatives such as Prime Minister Harper say the registry is wasteful and ineffective
Canada's minority government has lost a bid to end a rifle and shotgun registry which police say helps to trace guns used in crimes.
Members of parliament voted 153 to 151 to defeat a bill that would have ended the registry, but Conservative PM Stephen Harper vowed to try again.
He said opposition to the regulation was stronger "than it has ever been".
Opponents say the programme is ineffective and treats rural Canadian hunters and farmers like criminals.

Amid Tension, China Blocks Crucial Exports to Japan
By KEITH BRADSHER - NYTimes.com
HONG KONG - Sharply raising the stakes in a dispute over Japan's detention of a Chinese fishing trawler captain, the Chinese government has placed a trade embargo on all exports to Japan of a crucial category of minerals used in products like hybrid cars, wind turbines and guided missiles.
Chinese customs officials are halting all shipments to Japan of so-called rare earth elements, industry officials said on Thursday morning.

Toyota's Troubles Double as China Threatens Action
By: Pravda - marketoracle.co.uk
Misfortunes of Japanese automaker Toyota Motor Corp continue. Chinese authorities are threatening to fine the group for bribing dealers. The company, providing cheap loans to three of its dealers, forced them to issue loans to buyers not through the banks of the country, but directly through Toyota. The amount of the fine is 140 thousand Yuan ($20 thousand 650). Damages will amount to 426.3 thousand Yuan ($65 thousand 500).
According to Chinese authorities, a formal decision on penalties will come into force within three working days if Toyota fails to file a request for rehearing on this issue. Meanwhile, the company denies any such allegations and claims that no notification from Beijing on the penalty has been received, The Associated Press reports.

Cuba understands what US doesn't
As even the Cuban government lays off workers, we can't seem to face the looming problems posed by our own bloated public payrolls.
By Bill Fleckenstein - MSN Money
It might seem obvious, but one of the fundamental rules of investing is "don't lose money." That rule is also one of the more important and unnoticed casualties of the Greenspan-to-Bernanke era at the Federal Reserve.
Why? Because once you stop worrying about loss of capital, lots of bad things can happen (in addition to losing money).
For those who need proof, just look at our two most recent asset bubbles. People and companies got up to a lot of mischief and were usually not worried that they might lose money. A lot of them behaved accordingly, which is to say, recklessly.

Russia May Sell More Weapons to Syria, Serdyukov Says
By Ilya Arkhipov and Lyubov Pronina
Sept. 22 (Bloomberg) -- Russia will complete the delivery of anti-ship missiles to Syria this year and may sell more arms to the Mideast nation after assessing the impact on the regional balance of power, Defense Minister Anatoly Serdyukov said.
"All weapons within the earlier contract will be delivered by year end," Serdyukov said in an interview in Moscow. Syria has made new requests "that are being considered at present," he said. "Pre-contract work can last a few months to a few years. There is no guarantee a contract will be signed in the end."

Barack Obama's administration 'divided' over Afghan war
BBC.co.uk
Bob Woodward made his name exposing the Watergate cover-up
US President Barack Obama's senior advisers have been waging internal battles over Afghan policy for 20 months, according to a new book.
Obama's Wars by Bob Woodward is said to portray an uncertain administration as the president agrees to a troop surge of 30,000.
In one excerpt leaked to US media, US special envoy Richard Holbrooke sums up US policy by saying: "It can't work."
In another, President Obama tells a meeting he wants an exit strategy.

Bob Woodward book details Obama battles with advisers over exit plan for Afghan war
By Steve Luxenberg - Washington Post Staff Writer
President Obama urgently looked for a way out of the war in Afghanistan last year, repeatedly pressing his top military advisers for an exit plan that they never gave him, according to secret meeting notes and documents cited in a new book by journalist Bob Woodward.
Frustrated with his military commanders for consistently offering only options that required significantly more troops, Obama finally crafted his own strategy, dictating a classified six-page "terms sheet" that sought to limit U.S. involvement, Woodward reports in "Obama's Wars," to be released on Monday.
According to Woodward's meeting-by-meeting, memo-by-memo account of the 2009 Afghan strategy review, the president avoided talk of victory as he described his objectives.

Iran is far from united behind Mahmoud Ahmadinejad
Opposition figures, moderate politicians and even hard-liners openly criticize the divisive Iranian president.
By Borzou Daragahi and Ramin Mostaghim, Los Angeles Times
Reporting from Beirut and Tehran - In New York, Iranian President Mahmoud Ahmadinejad can boast that he's the talk of the town, appearing on television shows with the likes of Christiane Amanpour and Larry King, hobnobbing with fellow heads of state and addressing the United Nations General Assembly on Thursday.
In Tehran these days, the outspoken hard-line politician is under withering attack from all political directions. His detractors in recent weeks have included assorted fundamentalist clergymen who have accused him of interfering in religious affairs, a judiciary that humiliated him by delaying the release of American hiker Sarah Shourd, the editor of a right-wing newspaper handpicked by supreme leader Ayatollah Ali Khamenei, the moderate head of the powerful Assembly of Experts, and a member of parliament who condemned him for praising the pre-Islamic Persian king Cyrus, who is an icon of secular nationalists.

IRAN: Protest chants erupt across Tehran as authorities step up pressure on opposition - Alexandra Sandels in Beirut - LATimes.com
Chants of "Allah akbar", or "God is great," rang out into the night.
Once again, Iranian opposition supporters took to the rooftops of Tehran on Monday night, voicing their opposition to the authorities amid a ratcheting up of pressure on reformist leaders Mir-Hossein Mousavi and Mehdi Karroubi, according to opposition websites and video footage uploaded to the internet.

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Wednesday 09.22.2010

A Tale of Two Recoveries
The state of the economy after a year of 'rebound.'
WSJ.com (free)
It's official: The Great Recession ended 15 months ago, in June 2009. That was the word Monday from the economists at the National Bureau of Economic Research, the outfit that tracks the U.S. business cycle based on a variety of economic variables.
By their calculations, the downturn that began in December 2007 lasted 18 months, or the longest on record since the 43-month plunge of the Great Depression. On the other hand, the recession was only two months longer than the 16-month downturns of 1973-1975 and 1981-82, the two other most serious post-World War II periods of falling economic growth. The 2007-2009 downturn was painful but not extraordinary in historical context.

An Economic Wake-Up Call
by Simon Johnson, NYTimes.com
Before 1913, recessions in the United States were long (22 months on average) and painful (with little by way of social protection). They were often set off by financial crises, and the creation of the Federal Reserve in 1913 was intended -- by both left and right -- to at least reduce the probability that bank failures would lead to huge job losses.
Supporters of the Fed argue that the shorter duration (10 months on average) and reduced devastation of post-1945 recessions are due in part to the way monetary policy has operated -- including "easing" interest rates when the economy is slowing down (known more recently as the "Greenspan put"; meaning that the Fed implicitly put a floor under asset prices). The moral hazard that this produced -- in other words, you are not so careful about making bets when you feel that someone else will help protect you on the downside -- was limited, Greenspan and others argued, by the natural functioning of self-interest and market mechanisms.

Death to deficits by 'a thousand cuts'
By Jeanne Sahadi, senior writer
NEW YORK (CNNMoney.com) -- Every politician running for election to Congress professes to worry deeply about the country's debt situation, but no one is specific about what he would do, save for rhetoric like "cut spending" or "raise taxes."
The moderate-progressive think tank Center for American Progress on Tuesday tried to call everyone's bluff.
In a new report called "A Thousand Cuts," the group addresses the magnitude of spending cuts that would be required if lawmakers want to get the annual deficit down to the equivalent of 3% of the economy by 2015, a goal that President Obama has set.

Malpractice at the Bernanke Federal Reserve
Robert Auerbach - HuffingtonPost.com
During September 2008 hysteria hit the financial markets and the economy dived. Hundreds of billions of Lehman Brothers' liabilities dried up when it went bankrupt on September 16. A day later the Federal Reserve gave AIG an initial bailout of $85 billion. AIG was unable to pay its huge losses on insurance products that were exempt from insurance regulations. The following week the Fed announced that two large investment banks, Goldman Sachs and Morgan Stanley, would be made commercial banks allowing them readily available borrowing authority from the Fed's "discount window."

Fed: Recovery continues to slow
By Chris Isidore
NEW YORK (CNNMoney.com) -- The U.S. economic recovery continues to lose steam, the Federal Reserve said Tuesday, but the central bank unveiled only tougher language but no new policies to try to spur growth.
While the Fed said it expects improvement ahead, it cautioned "the pace of economic recovery is likely to be modest in the near-term."
The Fed left its federal funds rate at close to 0%. That overnight lending rate, which is used as a benchmark to set the rates paid on a wide variety of business and consumer loans, has been at that level since December 2008.

How High Will Gold Gold This Fall?
By Jeff Clark, Senior Editor, Casey's Gold & Resource Report
The gold price has been hitting ever-new records over the past couple weeks, now closing in on the $1,300 mark. Some gold followers are saying this is extremely bullish for the near-term price since it broke so decisively through its June 28th high of $1,261. If they're right, how high might this particular surge go?
While the endgame for gold is far off in my opinion, it's worth looking at short-term surges, especially if you're trying to determine to buy at a particular level. Plus, it's just darn fun.

Gold is going to double in the next five years
CommodityOnline.com
.... Frank Holmes: You're basically dealing with probabilities. The only certainties are that we're going to pay taxes and we're going to die; after that it's probabilities. At U.S. Global, we try to apply our matrix of top-down macro models. We also look at cycles. You're, historically, in a festive, emotional buying season for gold at this time of year. There's a difference between the mind and the heart. The bulk of the world's gold demand is jewelry and that's for the heart. Recently, there's been more and more of the mind, which means making decisions based on currency concerns. I think when those mind and heart forces overlap; you can get these big moves.

Gold Hits Another Record as Dollar Tumbles On Fed Announcement
Kurt Nimmo - Infowars.com
It is yet another example of the indispensability of gold as a hedge against the bankster engineered economic implosion. Earlier today, the precious metal reached a new record as the dollar tumbled further on the Fed announcement it will continue its habitual manipulation of monetary policy by keeping interest rates artificially low.
Gold reached $1,290.40 an ounce at 2:43 p.m., according to Bloomberg. At the same time, the beleaguered dollar fell 1.3 percent against a basket of six major currencies. Gold has surged 17 percent this year, heading for a 10th straight annual gain.

More gold gains, sideways dollar vs major currencies
By Allen Sykora of Kitco News
(Kitco News) -- Gold should keep rising in the fourth quarter but with potential for profit-taking pullbacks that could impede its progress, strategists with FOREX.com said Tuesday.
Meanwhile, the U.S. dollar is likely to move sideways against the world's other most heavily traded currencies, but could weaken against so-called minor currencies, they said during a Webcast outlining forecasts for the fourth quarter.
FOREX.com, a division of GAIN Capital Group LLC, has a trading platform with volume of $250 billion per month. Market participants can trade 45 currency crosses, along with gold and silver.

Who Will Buy the Last 88.3 tonnes of I.M.F. Gold?
By: Julian D. W. Phillips - SafeHaven.com
As you all know Bangladesh bought 10 tonnes of the gold on sale from the I.M.F. last week. This leaves 88.3 tonnes to sell now. The 10 tonnes that Bangladesh bought cost them around $1,260 an ounce. This tells us that price was not a determinant in the matter. This may surprise many, but it does highlight something about why central banks in general are buying gold now.
The potential, not just for currency crises, but serious foreign exchange structural problems is huge. The international level of cooperation between nations is poor [as we are seeing in the U.S. China faceoff over the Yuan exchange rate against the Dollar] leaving us uncertain at the prospect of unstable currency markets. This has vastly increased the attraction of gold as a reserve asset. As such the price paid for gold in foreign exchange reserves is hardly relevant. When that dark and rainy day comes its use in settling pressing foreign obligations will heavily outweigh what the gold cost. It's having the gold to pay these obligations or guarantee foreign currency obligations that will matter then.

Jim Rickards- Gold Standard is Plan B and
Revalue Gold at $5000+ (Dollar is Collapsing)

Why Gold is Going Higher
Chris Puplava - SilverBearCafe.com
Gold hit an all-time high today, rallying up to $1283.80 an ounce at one point. Gold is certainly overextended and ripe for a short-term correction, though I am still bullish on the shiny metal in terms of my longer term view. My bullish view on gold stems from the fact that the U.S. government is trying to kick the can down the road in terms of the misallocation of resources and cumulated debt.

Inflationary Understatement
By: The Mogambo Guru - SafeHaven.com
he Market Oracle newsletter jumps into the inflation-deflation debate, and says, "Debt deleveraging deflation completely ignores the fact that we are NOT living in the 1930's, but in a globalised world economy that is seeing the convergence of real GDPs where the developing world is eating up the [world's] resources at a faster pace then the west is cutting back on consumption."
Something in my Puny Mogambo Brain (PMB) went, "Ding!" when I instantly recognized this as a classic case of the age-old supply/demand dynamic where price equilibrates demand with supply, in this case the increasing demand from the "developing world" is swamping demand from the "developed" world, meaning an increased demand, but with no mention of the physical supply of resources, which are hard to increase and are, in the short run at least, absolutely fixed.

Fed Prepared to Ease Further to Revive Economy
Fed Prepared to Take Steps to Foster Growth, Refrains From Asset Purchases - By Craig Torres
Sept. 21 (Bloomberg) -- The Federal Reserve said it's willing to ease monetary policy further to spur growth and support prices while refraining today from expanding its holdings of securities.
"The committee will continue to monitor the economic outlook and financial developments and is prepared to provide additional accommodation if needed to support the economic recovery and to return inflation, over time, to levels consistent with its mandate," the Federal Open Market Committee said today in a statement in Washington.

Today's FOMC QE Bombshell Shows Why Share Buybacks And M&A Will Now Accelerate
Vincent Fernando, CFA - businessinsider.com
The Fed expects continued low U.S. inflation and weak economic growth according to today's FOMC statement.
They even made it clear that they are prepared to deliver additional quantitative easing if necessary, which means that the Fed will err on the side of caution and interest rates are likely to remain lower for longer.
Now jump over to the many international companies who sit on growing cash piles earning nothing, but are faced with uncertain growth prospects for new investment, and today's FOMC statement only emphasizes why share buybacks and M&A will accelerate going forward.

Fed Stands Pat and Says It Is Still Ready to Buy Debt
By SEWELL CHAN - NYTimes.com
WASHINGTON - Officials at the Federal Reserve signaled on Tuesday for the first time that they were worried that the slow-moving economic recovery could be undermined by very low rates of inflation, and hinted strongly that it might resume buying vast amounts of government debt to spur the recovery. While the central bank's Federal Open Market Committee did not take any new steps on interest rates, it communicated in unmistakable terms its concerns about the fragility of the economic recovery and a threat to stable prices.
It said that underlying inflation levels, which have hovered at about half the Fed's 2 percent target rate, were "somewhat below those the committee judges most consistent, over the longer run, with its mandate to promote maximum employment and price stability."

Fed pledges more economic aid
Lenient policy strays from inflation-fighting mission, critics say
By Patrice Hill - The Washington Times
The Federal Reserve pledged Tuesday to provide more aid to the economy should the sluggish recovery slow even more in coming weeks.
Signaling the likelihood of more lenient money policies in coming weeks, the nation's central bank took no immediate steps on interest rates but noted that consumer spending - the biggest engine of economic growth - "remains constrained by high unemployment, modest income growth, lower housing wealth and tight credit."

Governor Christie: Put Up or Shut Up

Dollar Falls to Six-Week Low on Prospects for More Fed Easing
By Candice Zachariahs and Ron Harui
Sept. 22 (Bloomberg) -- The dollar fell to a six-week low against the euro on speculation the Federal Reserve's willingness to ease monetary policy further will damp demand for U.S. assets.
The greenback weakened against 13 of its 16 major counterparts after U.S. policy makers said at a meeting yesterday they "will provide additional accommodation if needed" as the recovery and job growth have slowed. The euro gained for a third day versus the dollar as concerns about the European sovereign debt crisis eased after investors bought the maximum amounts offered at Spanish and Irish debt sales.

Slouching Towards Bethlehem: Double Dip or Banana Split?
JESSE'S CAFÉ AMÉRICAIN

"If the 2010 contraction we are now monitoring in consumer demand for discretionary durable goods scales to the full economy as faithfully as the "Great Recession" did, the second dip will, at minimum, be 33% more painful than the first dip and will extend at least half again as long."

This is the case for trouble dead ahead, a worse decline in consumer activity and therefore GDP than the first, and the likelihood of further quantitative easing from the US Federal Reserve to patch over the inability of the political process to reform the financial system and balance the real economy because of their myriad conflicts of interest. These policy errors favoring a small minority will most likely result in a stagflation of the most pernicious and corrosive kind, high unemployment and a rising price of essentials, that may ultimately test the fabric of society. Obsession and sociopathy are not generally ruled or limited by the equilibrium of common sense and ordinary appetite, so I would not expect the powerful minority to draw back from the brink of this crisis voluntarily: a classic scenario for exogenous change. I would enjoy the moral irony of all this if I was watching from the distant future.

Fed's Signals Push Down Dollar, Yields
By JONATHAN CHENG And TOM LAURICELLA - WSJ.com (free)
Investors braced for the prospect of further actions by the Fed to hold down interest rates, dumping the dollar and buying Treasurys and gold ahead of another potential burst of government buying of Treasurys.
Two-year Treasury yields, which decline as the price rises, fell to another low of 0.432%, while gold surged after the Federal Reserve hinted it is worried about the low level of inflation, suggesting to many that it is prepared to start a new round of stimulus to bolster the economy.

A Ride on the Currency Roller Coaster
By Chuck Butler - The DailyReckoning.com
09/21/10 St. Louis, Missouri - The Ohio Players were singing their song "Roller Coaster" as I begin today's letter. I thought the song played well with the action we've seen in the currencies lately... The Roller Coaster of Love, has turned into The Roller Coaster of Currencies ...
What am I talking about? In each of the last four or five mornings, I've come in, turned on the currency screens and seen the euro (EUR) trading stronger versus the dollar; the last three days, it's been above 1.31, only to see the single unit fall throughout the day in US trading ... but then rally again overnight ...Up, down, up, down, we need some new directions, eh?

P.R.I.N.T. Money, That's how Ben's Gonna fix the Economy
By Rocky Vega - The DailyReckoning.com
09/21/10 Stockholm, Sweden - The FreeCreditReport.com commercials are always hilarious. The nation's fiscal mess ...not so much. But, sometimes a little laughter helps to ease the pain.
Appropriately, this parody of the "New Car" ad stars several of America's biggest credit-wreckers-in-chief: Fed head Ben Bernanke alongside Treasury Secretaries Hank Paulson and Tim Geithner. Times may change, but their money-printing solutions stay the sameÉ at least inconsistency is one of few skills this team ain't lacking.

P.R.I.N.T. Money

Outlook Gloomy at Secret Billionaire Meeting
By: John Melloy - Executive Producer, Fast Money
For 25 years, legendary Wall Street strategist Byron Wien, now with The Blackstone Group, has held summer meetings with high net worth individuals to get their outlook on the global economy and investing. This year's group, totaling fifty individuals and including more than 10 billionaires, was decidedly pessimistic on the U.S. economy, investment opportunities and the Obama administration.
"They saw the United States in a long-term slow growth environment with the near-term risk of recession quite real," said Wien, in a commentary to Blackstone clients. "The Obama administration was viewed as hostile to business and that discouraged both hiring and investment. Companies and entrepreneurs were reluctant to add workers because they didn't know what their healthcare costs or taxes were going to be."

Summers Will Leave White House to Return to Harvard
By Hans Nichols
Sept. 21 (Bloomberg) -- Lawrence Summers plans to leave his job as director of the president's National Economic Council and return to Harvard University at the end of the year, the administration announced.
"I will always be grateful that at a time of great peril for our country, a man of Larry's brilliance, experience and judgment was willing to answer the call and lead our economic team," President Barack Obama said in a statement. "He has helped guide us from the depths of the worst recession since the 1930s to renewed growth."

Will Summers Reunite With Wall Street?
With Lawrence H. Summers set to depart the Obama administration, forgive us for wondering whether he will reestablish his ties to high finance.
So far we know that Mr. Summers will leave his post as the director of the National Economic Council to resume teaching at Harvard. But he was also known for spending some time on Wall Street, specifically the hedge fund D. E. Shaw, from which he collected a $5 million paycheck in 2008.
Mr. Summers also picked up $2.7 million in fees for speaking to Wall Street firms.
The White House's statement on Mr. Summers's pending departure says simply that he'll take up the position of University Professor, meaning a lot of teaching and writing. There's nothing preventing him from taking a spot at a financial shop like D. E. Shaw, where he counseled the firm's corps of traders and math wizards - and met with current and potential investors around the world.

The Game is Changing and the US is Now on the Defensive
By: Global Intelligence Report - via SafeHaven.com
The People's Republic of China's PLAN in the Indian and Pacific Oceans: The Game is Changing and the US is Now on the Defensive
Two warships of the People's Republic of China (PRC) People's Liberation Army-Navy (PLAN) docked at a port in Myanmar on August 29, 2010, in the first publicized PLAN ship visit -- but not the first actual PLAN visit -- to Myanmar.
It was a move designed to help pre-position the PRC in its relations with Myanmar in the lead up to that country's upcoming national elections. The move also ended two decades of discreet PRC approaches to its naval presence in the Indian Ocean. It also follows the open PLAN task force presence in anti-piracy operations off the Horn of Africa, and the now open commitment to use of the Pakistani Baluchistan port of Gwadar, at the entrance to the Persian Gulf.

China Won't Let Yuan Rise Soon in Poll Signaling No. 1 Economy
By Rebecca Christie
Sept. 22 (Bloomberg) -- Most global investors expect China to become the world's biggest economy over the next two decades, and they are divided over whether that will help or hurt the economies of other industrialized countries.
There's also a strong consensus that China won't move very aggressively to increase the value of its currency by the end of next year, according to a global quarterly poll of 1,408 investors, analysts and traders who are Bloomberg subscribers. Almost seven in 10 expect China to revalue the yuan by a few percent or less against the dollar, rather than a surge like the yuan's roughly 20 percent rise between 2005 and 2008.

The Long View of China's Currency
By DAVID LEONHARDT - NYTimes.com
Spend enough time with Chinese officials and economists, and you will hear a story about the Japanese yen in the 1980s.
Back then, Americans were upset about Japanese imports flowing into the country, just as they are upset about Chinese imports today. So the United States pushed Japan to let the yen appreciate, thereby making Japanese imports more expensive and American exports to Japan cheaper. Tokyo complied, and the yen surged almost 50 percent from 1985 to 1987.

Keiser Report No.79: Currency Wars Break Out

Chinese Business Gains Foothold in Eastern Europe
By JUDY DEMPSEY - NYTimes.com
BUDAPEST - The classroom walls at the Hungarian-Chinese bilingual primary school here are decorated with Chinese calendars and banners. Chinese lanterns hang from the ceilings of the main entrance hall. There are stacks of new Chinese language books in the staff room, provided by the Chinese authorities, who also send two teachers a year, depending on the school's needs.
The school cafeteria, however, serves only local fare. "No Chinese food, at least not yet," said Viktoria Schaff, one of the teachers.

White House Science Czar Says He Would Use 'Free Market
to 'De-Develop the United States'
By Nicholas Ballasy
(CNSNews.com) - In a video interview this week, White House Office of Science and Technology Director John P. Holdren told CNSNews.com that he would use the "free market economy" to implement the "massive campaign" he advocated along with Population Bomb author Paul Ehrlich to "de-develop the United States."
In his role as President Barack Obama's top science and technology adviser, Holdren deals with issues ranging from global warming to health care.

Obama Among 'Small Businesses' Facing Higher Tax Rate
By Ryan J. Donmoyer
Sept. 20 (Bloomberg) -- Senate Republican leader Mitch McConnell says President Barack Obama wants to subject half of all small-business income to a tax increase, a move that he says would strike a blow at the U.S. job-creation engine.
McConnell's numbers add up only if you consider people like billionaire investor George Soros, most movie stars and Obama himself small-business owners, tax experts say.
That's because the lawmaker is basing his figure on a broad definition of the term that experts say includes authors, actors and athletes who employ few if any workers. It also encompasses businesses that many people wouldn't consider small, such as Soros's hedge-fund firm and major law partnerships.

Obama Among 'Small Businesses' Facing Higher Tax Rate
By Ryan J. Donmoyer
Sept. 20 (Bloomberg) -- Senate Republican leader Mitch McConnell says President Barack Obama wants to subject half of all small-business income to a tax increase, a move that he says would strike a blow at the U.S. job-creation engine.
McConnell's numbers add up only if you consider people like billionaire investor George Soros, most movie stars and Obama himself small-business owners, tax experts say.
That's because the lawmaker is basing his figure on a broad definition of the term that experts say includes authors, actors and athletes who employ few if any workers. It also encompasses businesses that many people wouldn't consider small, such as Soros's hedge-fund firm and major law partnerships.

Senate Democrats want middle-class tax cut vote
By Jennifer Liberto
WASHINGTON (CNNMoney.com) -- Senate Democrats are aiming to force a vote extending tax breaks for the middle class -- and not for those in the top income bracket -- before they adjourn for the midterm elections.
But it's not clear the vote will happen; and it depends on Democrats working out a procedural deal with Republicans, two aides and Senate Majority Whip Dick Durbin, D-Ill., said Tuesday.
If the vote happens, it will likely be a test vote on extending tax cuts - now slated to expire at the end of the year - for families earning less than $250,000 and individuals earning less than $200,000.

Ron Paul at the Kitco Metals eConference (via webcam)

Senate Democrats want middle-class tax cut vote
By Jennifer Liberto
WASHINGTON (CNNMoney.com) -- Senate Democrats are aiming to force a vote extending tax breaks for the middle class -- and not for those in the top income bracket -- before they adjourn for the midterm elections.
But it's not clear the vote will happen; and it depends on Democrats working out a procedural deal with Republicans, two aides and Senate Majority Whip Dick Durbin, D-Ill., said Tuesday.
If the vote happens, it will likely be a test vote on extending tax cuts - now slated to expire at the end of the year - for families earning less than $250,000 and individuals earning less than $200,000.

Mortgage Bonds Least Likely to Refinance Rally: Credit Markets
By Jody Shenn
Sept. 21 (Bloomberg) -- Investors in U.S.-backed mortgage bonds are shifting into securities tied to debt from homeowners who are the least willing or able to refinance as the Federal Reserve helps keep interest rates near record lows.
Fannie Mae-guaranteed securities with 5.5 percent coupons that are backed by 30-year mortgages with average balances of less than $85,000 have jumped to 2.4 cents on the dollar more than similar generic debt, according to FTN Financial. The gap has more than doubled from 1.1 cents in late July.

FHA Backs Record Number of Mortgages in 2009
By Michael Kraus - TotalMortgage.com
FHA mortgages have become increasing popular in recent years. Yesterday there was a report from the Federal Financial Institutions Examination Council (which I found via Housingwire) that found the Federal Housing Administration (FHA) insured 37 percent of all mortgages originated in 2009. In 2008 FHA insured 26 percent of mortgages and 7 percent in 2007. This is a huge increase in volume for FHA and is somewhat disconcerting when the FHA's insurance fund is considered.
In case you were unaware, the FHA insures mortgages against default and is required by Congress to keep capital reserves equal to 2 percent of total liability exposure to default. As defaults on subprime (and prime) loans increased, the FHA's reserves were depleted. Earlier this summer, the FHA insurance fund fell as low as .53 percent of total liability.

Get Used To Lower Living Standards
by Yves Smith - NYTimes.com
Most Americans probably find it hard to believe that statisticians have deemed the U.S. economy to be out of recession. Unemployment and underemployment are stubbornly stuck at the highest level since the Great Depression. Capacity utilization is under 75 percent, well below pre-crisis levels. There is still a large overhang of houses in foreclosure and serious delinquency, meaning that the housing market has yet to bottom.
The ugly fact is that serious financial crises take a very long time to resolve and result in a permanent fall in the standard of living. Past historical patterns confirm the slow job creation rate: it will be many years before the excesses of the credit bubble work their way through. That means the best we can hope for, absent aggressive government action, is an economy that bumps along at a low level of what is technically growth, but is very far from what most businessmen and consumers would consider healthy.

COMFORT ZONE, TWILIGHT ZONE OR DEAD ZONE?
By Greg Evensen - NewsWithViews.com
The Anatomy of the Death of America Comfort
Many of us across America have been experiencing an unusual period of heat, humidity and high amounts of rain. Unless you have air conditioning, it has been highly uncomfortable with mold and bugs emerging all around. The other sense of atmospheric closeness is the descending veil of evil in the air that is enveloping us like a wet wool blanket. Our "comfort zone" in physical terms has been disrupted. We have seen vast amounts of mold and bugs emerging in the halls of congress as well, regardless of the weather conditions. In Washington's case, it is killer mold and scorpions. Eradication and a thorough cleaning of the house is long overdue. How much comfort are you willing to give up? How comfortable have you become being a part of this stench and rot that surrounds you and your family? Apparently, many Americans are still quite satisfied to walk in the putrefying remains of liberty and personal sovereignty. You are so used to the feel and odor of that wretched scene that you really do not remember what real freedom felt and tasted like. Comfort has given rise to fat, stupidity and waste. Time to clean house where you live as well.

Stores Scramble to Accommodate Budget Shoppers
By STEPHANIE CLIFFORD - NYTimes.com
The country's continued economic doldrums have stores scrambling for the once-ignored low-end customer, as people make fewer costly shopping trips to stock their pantries, and increasingly, can only afford inexpensive items in small quantities like those sold at dollar stores.
Dollar stores have shown the biggest gain in shopper visits over the last year out of all the retailers that sell basic consumer goods, according to market research data. Manufacturers are racing to package more affordable versions of products common at those stores, and other budget retailers, feeling the loss of customers, are trying to duplicate their success.

Jobless Rate Rises in 27 States
By MOTOKO RICH - NYTimes.com
The unemployment rate rose in 27 states between July and August, the Labor Department reported Tuesday, although only Maryland and Florida recorded statistically significant increases.
Nevada again had the highest unemployment rate in the country in August. The rate, 14.4 percent, was at its highest since the department began keeping records of state unemployment in 1976.
It was the fourth consecutive month that Nevada topped the list of states, followed by Michigan with a rate of 13.1 percent and California with 12.4 percent. North Dakota again had the lowest rate, at 3.7 percent.

Federal Pay Still Inflated After Accounting for Skills
Federal employees are paid substantially more than comparably skilled private sector workers.
By JAMES SHERK AND JASON RICHWINE
From the Heritage Foundation via WSJ.com
The Heritage Foundation has conducted two separate studies that both reach the same conclusion: Federal employees are paid substantially more than comparably skilled private sector workers. Defenders of the federal pay system, including the U.S. Office of Personnel Management (OPM), have mischaracterized The Heritage Foundation's analyses by suggesting they ignore skill differences between the public and private sectors, resulting in an "apples to oranges" comparison. On the contrary, Heritage has carefully accounted for skill differences, always comparing apples to apples.

Obama’s Aunt: ‘If I Come Here As An (Illegal) Immigrant, You Have The Obligation To Make Me A Citizen’

Auntie Z Speaks

The Uncounted Unemployed
by Mike Konczal - NYTimes.com
Recovery in output, which is the technical definition of a recession, is very different than recovery in the labor market.
The labor market is very fragile. There has been a huge spike in the amount of workers who have dropped out of the labor force entirely. There is a record high percentage of people working part time involuntarily because of slack business conditions and a lack of demand. Small businesses' largest complaint is a lack of sales and customers. And foreclosures remain near peak levels, reflecting continued weaknesses in both the housing market and employment. All of this points to an uncertain recovery.

Cessna boss Pelton: 700 layoffs are result of a stalled recovery
BY MOLLY McMILLIN - The Wichita Eagle
Cessna Aircraft told employees today that the company is cutting 700 jobs as weakness in new aircraft orders continues.
All of the layoffs will be in Wichita.
Cessna CEO Jack Pelton notified employees in a letter. Cessna also has had to adjust its production schedule downward.
"The gains made in the first half of the year in the global economy have stalled, and Cessna's performance continues to mirror the lackluster economy," Pelton said in the letter. "While cancellations have slowed, the recovery and growth we expected to see throughout the year have not materialized, and the timing of any recovery remains uncertain."

Cessna layoffs show business-jet weakness
Slashing of 700 jobs at Kansas plant not a good sign for industry as a whole, analyst says
Bertrand Marotte Montreal - From Wednesday's Globe and Mail
Reports of the business-jet market's recovery may have been premature.
Cessna Aircraft Co.'s decision to cut back production, resulting in the slashing of 700 jobs at its facility in Wichita, Kan., is not a good omen for the industry as a whole, says Beno”t Poirier, an analyst with Desjardins Securities.
"We believe the announcement indicates that the bizjet recovery is stagnating, especially in the low-end segment," Mr. Poirier said in a research note Tuesday.

Abbott to cut 3,000 jobs
By Ben Rooney
NEW YORK (CNNMoney.com) -- Abbott Laboratories said Tuesday that it will eliminate 3,000 jobs as part of a restructuring plan following its acquisition of Solvay Pharmaceuticals.
The Abbott Park, Ill.-based health care company announced plans to buy Belgium-based Solvay for $6.2 billion in February.
Abbot spokesman Scott Stoffel said the move will "streamline operations and improve efficiencies across our global pharmaceuticals business."

After plant's closure, Illinois town takes care of itself
By Judy Keen, USA TODAY
HERRIN, Ill. - Mayor Vic Ritter learned on a rainy morning in May 2006 that the Maytag plant here was going to close, eliminating almost 1,000 jobs.
"It was like somebody had hit me in the stomach as hard as they could," he recalls. "I thought we were done. Herrin's done."
He imagined people moving away, a dwindling tax base and declining school enrollment in this southern Illinois town of 12,450 with a bustling downtown, a coal-mining history and a close-knit population of European immigrants' descendants.

Officials Arrested in Los Angeles Suburb
By ADAM NAGOURNEY and REBECCA CATHCART - NYTimes.com
BELL, Calif. - The investigators from the district attorney's office showed up at the mayor's house early Tuesday morning, arrest warrant and battering ram in hand, banging on the door. When the mayor, Oscar Hernandez, ignored their shouts - "Come out!" and "Put your hands up!" - they rammed down the door and arrested Mr. Hernandez on charges of looting the treasury of his own city to enrich himself.

Mark Cuban to Face S.E.C. Insider Case Again
By PETER LATTMAN - NYTimes.com
The legal battle between the Securities and Exchange Commission and Mark Cuban is back on.
A federal appeals court on Tuesday reinstated the S.E.C.'s insider-trading case against Mr. Cuban, the Internet entrepreneur turned owner of the Dallas Mavericks basketball club. A trial court judge dismissed the lawsuit more than a year ago.
The S.E.C. brought civil charges against Mr. Cuban in November 2008, accusing him of trading on confidential information when he sold his stake in a small Internet search company just before it announced news that caused its stock price to drop.

Germany demands internet code of practice
By Gerrit Wiesmann in Berlin - FT.com
The German government has reacted to public privacy concerns about Google Street View by demanding internet companies work out a code of practice to protect the data they collect.
Thomas de Maizire, interior minister, said voluntary regulation could render legislation "at least in part redundant", a signal that the government is softening its line on regulation of new internet services.
Google this summer kicked off a controversial debate in Germany when it announced it would put photographs of streets of 20 German cities on the web by the end of the year.

BP's Shock Waves
How the oil giant's catastrophic spill in the Gulf could trigger another financial meltdown - By Matt Taibbi - Rolling Stone Politics
It was sickening enough when British oil giant BP set new standards for corporate scumbaggery in the Deepwater Horizon oil spill, turning the Gulf of Mexico into its own personal toilet and imperiling entire species of wildlife in an attempt to save a few nickels. But with the Gulf geyser finally capped, there's still a way for BP to cause an even more unthinkable disaster: an AIG-style, derivative-fueled financial shitstorm. If the company decides to declare bankruptcy - a very real possibility with these bastards - it could trigger chaos in our casino system of finance, underscoring the insane levels of leverage and systemic risk we have left in place, even after the global economic crash of 2008.

Bridgestone, Goodyear Face Deepening Rubber Shortage
By Aya Takada and Supunnabul Suwannakij
Sept. 21 (Bloomberg) -- Bridgestone Corp., the largest tiremaker by sales, is raising European prices for the second time this year and Goodyear Tire & Rubber Co. is charging more as rubber gains on prospects for the biggest shortage since 2007.
"Drought earlier this year and heavy rains later on hampered tree-tapping across Asian plantations," said Pongsak Kerdvongbundit, managing director of Phuket, Thailand-based Von Bundit Co., the largest natural-rubber producer and exporter in the world's biggest supplier. "Global production will lag behind soaring demand for at least another two years."

U.S. Nuclear Weapons Have Been Compromised by Unidentified Aerial Objects
Ex-military men say unknown intruders have monitored and even tampered with American nuclear missiles
Group to call on U.S. Government to reveal the facts
WASHINGTON, Sept. 15 /PRNewswire-USNewswire/ -- Witness testimony from more than 120 former or retired military personnel points to an ongoing and alarming intervention by unidentified aerial objects at nuclear weapons sites, as recently as 2003. In some cases, several nuclear missiles simultaneously and inexplicably malfunctioned while a disc-shaped object silently hovered nearby. Six former U.S. Air Force officers and one former enlisted man will break their silence about these events at the National Press Club and urge the government to publicly confirm their reality.

Third world America
Luiza Savage - SilverBearCafe.com
In February, the board of commissioners of Ohio's Ashtabula County faced a scene familiar to local governments across America: a budget shortfall. They began to cut spending and reduced the sheriff's budget by 20 per cent. A law enforcement agency staff that only a few years ago numbered 112, and had subsequently been pared down to 70, was cut again to 49 people and just one squad car for a county of 1,900 sq. km along the shore of Lake Erie. The sheriff's department adapted. "We have no patrol units. There is no one on the streets. We respond to only crimes in progress. We don't respond to property crimes," deputy sheriff Ron Fenton told Maclean's. The county once had a "very proactive" detective division in narcotics. Now, there is no detective division. "We are down to one evidence officer and he just runs the evidence room in case someone wants to claim property," said Fenton. "People are getting property stolen, their houses broken into, and there is no one investigating. We are basically just writing up a report for the insurance company."

How To Resist Federal Tyranny
by Fergus Hodgson - LewRockwell.com
According to Rasmussen Reports, constituent hostility to the federal government is at an unprecedented high, and twenty state attorneys general, including Louisiana's, are challenging the constitutionality of the 2010 federal health care reform. However, in his latest book, Nullification: How to Resist Federal Tyranny in the 21st Century, Thomas Woods argues for more than voter scrutiny and pleas to the United States Supreme Court. He advocates the rediscovery and use of state nullification against unconstitutional federal laws.

GOP, Tea Party Unity Spells Defeat For Obama
Republicans should be grateful tea partiers did not run as third-party candidates and split the antistatist vote.
By HALEY BARBOUR - WSJ.com
Christine O'Donnell's upset victory in last week's Delaware GOP Senate primary has generated a lot of talk in the media about where the tea party and the GOP are headed.
Tea party voters have been incited to political action by the policies of the Obama administration and the Pelosi-Reid Congress. These include a heretofore unimaginable federal spending spree, a failed package of stimulus programs, a government takeover of our health-care system, and the Democrats' insistence on raising taxes, particularly on job creators, even though job creation is our country's greatest need.

Prepare To Be Betrayed
by Llewellyn H. Rockwell, Jr. - LewRockwell.com
It's another revolutionary season in American politics, with voters preparing to do everything they can within the structure of the law to throw out the bad guys and the bad system they represent. The focus is on this amorphous thing called the Tea Party, which embodies a huge range of political impulses from libertarian to authoritarian, united under the common belief that everything is going wrong in Washington, with a common goal of upending the status quo.
Candidates that the Republican Party doesn't like are making big inroads into the party structure and, quite possibly, the election itself. That is fun to watch. The wind at their backs is the spectacular - but wholly predictable - failure of the Obama administration's economic witchcraft. Trillions and trillions created and spent and yet the suffering endures.

If You've Lost Colin Powell
By Ken Blackwell - The American Spectator.org
"If I've lost Walter Cronkite, I've lost Middle America," said President Lyndon B. Johnson at the time of the Communist Tet Offensive in Vietnam in 1968. Walter Cronkite was then the CBS News anchor man, often described as 'the most trusted man in America." Just a few weeks after he said that, LBJ withdrew from his party's nomination contest.
No one thinks President Obama is in that much trouble -- yet. But he has just been criticized by his highest profile endorser from the 2008 campaign. When retired four-star Gen. Colin Powell backed Barack Obama for President two years ago, it was a huge leg up for the liberal Democrats' prospects. Gen. Powell, a former Secretary of State and a former Chairman of the Joint Chiefs of Staff, gave Obama instant credibility on defense and foreign policy issues.

Hillary Wants Global Standards For Cookstoves
"Our long term goal is to have universal adoption all over the world," says Secretary of State Hillary Clinton.
By Eric Scheiner
(CNSNews.com) - The Global Alliance for Clean Cookstoves was announced Tuesday by Secretary of State Hillary Clinton at the Clinton Global Initiative Meeting.
The goals of the Global Alliance for Clean Cookstoves are multi-tiered. "First, a major applied research and development effort to improve design, lower costs and develop global industry standards for cookstoves" Clinton said. "Second, a broad-based campaign to create a commercial market for clean stoves, including reducing trade barriers, promoting consumer awareness and boosting access to large scale carbon financing."

Clinton to unveil US funds for clean cookstove push
By Jeff Mason
NEW YORK, Sept 21 (Reuters) - Secretary of State Hillary Clinton will announce on Tuesday a U.S. contribution of more than $50 million toward providing clean cooking stoves in developing countries to reduce deaths from smoke inhalation and fight climate change.
The U.S. funding, which will be spread over five years, is part of a Global Alliance for Clean Cookstoves being started to combat a problem officials equate with malaria and unclean water in terms of their health impact worldwide.

Italy Investigating Pope's Bank For Money Laundering
Gregory White - BusinessInsider.com
The Pope's bank in Rome, the Institute for Works of Religion, is now under investigation by the Italian state on money laundering charges.
Already the Italian authorities have frozen $30 million connected to the case.
That $30 million was sent to two different banks: JPMorgan Frankfurt and Banca del Fucino.
The investigation into the bank centers on missing data from order forms.

President Ahmedinejad Threatens U.S. With War 'Without Boundaries'
Iranian President Says Country Will Defend Its Nuclear Facilities
By THOMAS NAGORSKI, ABC News Managing Editor
Iranian President Mahmoud Ahmedinejad warned the Obama administration today that if Iran's nuclear facilities are attacked, the U.S. will face a war that "would know no boundaries."
The Iranian president, who is in New York for the annual meetings of the United Nations General Assembly, spoke at a breakfast meeting with reporters and editors at Manhattan's Warwick Hotel.
He said that Iran is on the brink of becoming a nuclear power, and warned Israel and the U.S. against attacking its nuclear facilities.

Ahmadinejad aims to change World Order

Ahmadinejad says capitalism faces defeat
By Edith M. Lederer - Associated Press - LATimes.com
UNITED NATIONS (AP) - Iran's President Mahmoud Ahmadinejad declared Tuesday that capitalism faces inevitable defeat and called for the overhaul of "undemocratic and unjust" global decision-making bodies.
In a speech on the second day of a U.N. anti-poverty summit, the Iranian leader blamed capitalism and transnational corporations for "the suffering of countless women, men and children in so many countries."

Unipolar World Will Lead to War: Mahmoud Ahmadinejad to RT

Ahmadinejad blames capitalism for poverty
By EDITH M. LEDERER - AP - WashingtonPost.com
UNITED NATIONS -- Iran's president on Tuesday predicted the defeat of capitalism and blamed global big business for the suffering of millions, but Germany's chancellor said market economies were key to lifting the world's least developed countries out of poverty.
The clash of visions at the U.N. anti-poverty summit drew a line under the stark differences on easing the misery of the one billion people living on less than $1.25 a day.

Russia May Sell More Weapons to Syria as U.S., Israel Protest
By Ilya Arkhipov and Lyubov Pronina
Sept. 22 (Bloomberg) -- Russia will complete the delivery of anti-ship missiles to Syria this year and may sell more arms to the Mideast nation after assessing the impact on the regional balance of power, Defense Minister Anatoly Serdyukov said.
The U.S. and Israel this week expressed concern that the proliferation of advanced weapons may destabilize the Middle East. Russia plans to honor existing contracts and is reviewing additional Syrian requests, Serdyukov said, after returning to Moscow from meetings with U.S. Defense Secretary Robert Gates.

Economic Talks on Hold
Spiegel.de
Netanyahu Gets The Cold Shoulder From Brussels
The EU has rebuffed a diplomatic initiative by Israel aimed at improving economic and political ties. Israel had expected the EU to restart economic negotiations in response to the resumption of Middle East peace talks earlier this month. But the EU first wants to see real progress rather than symbolism.
Israeli diplomatic overtures aimed at bettering relations with Europe have failed. The European Union is not prepared to deepen cooperation with Israel on political and economic issues, despite Israeli expectations that it would do so in response to the resumption of Middle East peace talks at the start of the month.

Globalists Plan to Dismantle Middle Class With UN Tax!! 1/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 2/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 3/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 4/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 5/6

Globalists Plan to Dismantle Middle Class With UN Tax!! 6/6

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Tuesday 09.21.2010

GOP Aims to Erode White House Agenda
Preparing for a Potential Congressional Majority, Republican Leaders Say Repeal of Health-Care Law Tops Their Priorities
By NEIL KING JR. And JANET ADAMY - WSJ.com
Eyeing a potential Congressional win in November, House Republicans are planning to chip away at the White House's legislative agenda - in particular the health-care law-by depriving the programs of cash.
The emerging plan has been devised in part to highlight the policy differences between the two main parties, especially over legislative achievements of the Obama administration that have proven unpopular with voters.

Big hole in GOP health repeal plan
'Without the president, we can't repeal [health care law],' said Mitch McConnell. By CARRIE BUDOFF BROWN Politico.com
For some Republicans, it's one of the most potent attack lines this fall, prized for its simplicity.
Want to kill the new health care law? Just starve it of cash and replace it with something else.
But there's nothing simple about it.
Experts - and even some Republicans - say a GOP-controlled Congress next year would have to struggle to erase nearly $1 trillion in health reform spending over 10 years with the flick of a pen. Key parts of the bill, like new Medicaid entitlements, would require free-standing legislation, not merely routine changes during the appropriations process.

Obama: No Decisions on Possible Geithner, Summers Departures
By Jennifer Bendery - Roll Call Staff
President Barack Obama hedged Monday on whether he planned to keep Treasury Secretary Timothy Geithner and economic adviser Larry Summers on his staff after the midterm election.
CNBC reporter John Harwood posed the question to Obama during a town hall meeting on the economy in Washington.
"I have not made any determinations about personnel," the president said. "Larry Summers and Tim Geithner have done an outstanding job, as have my whole economic team. This is tough, the work that they do. They've been at it for two years. And, you know, they're going to have a whole range of decisions about family that'll factor into this as well."

Bernanke Drops the Ball Again
By Rob Parenteau - The DailyReckoning.com
09/20/10 San Francisco, California - From Fed Chairman Ben Bernanke's remarks to the Economic Symposium in Jackson Hole, Wyoming:
Notwithstanding some important steps forward, however, as we return once again to Jackson Hole I think we would all agree that, for much of the world, the task of economic recovery and repair remains far from completeÉ Central bankers alone cannot solve the world's economic problems.
Had the chairman stopped right there, not just for dramatic pause, but for good, and dramatically stepped down from the podium, boldly walking off stage in front of his brethren from the world's monetary policy elite, he would have qualified for a Cuban cigar, a Nobel Prize and an early all-expense-paid retirement. Not necessarily in that order, but you get the picture.

Obama Criticizes China's Currency Policy, Praises Economic Team
By Hans Nichols and Kate Andersen Brower
Sept. 21 (Bloomberg) -- President Barack Obama criticized China's currency policy, praised his economic team and called predictions of a Republican takeover of the House of Representatives "premature."
China's leaders haven't done "everything they said would be done" to allow the nation's currency to rise in value, Obama said yesterday, echoing the views expressed by administration officials and lawmakers at congressional hearings last week. "What we've said to them is you need to let your currency rise," he said in an hour-long town hall discussion on the economy broadcast on CNBC television.

Dollar Falls for Second Day Versus Euro on Slow U.S. Recovery
By Candice Zachariahs and Ron Harui
Sept. 21 (Bloomberg) -- The dollar fell for a second day versus the euro on speculation the U.S. housing market will remain fragile, adding to signs the world's largest economy will take time to recover.
Australia's dollar was near the highest in two years as its central bank said higher interest rates may be needed to cope with the nation's economic growth. Malaysia's ringgit traded near a 13-year high versus the greenback as investors sought higher-yielding assets with the Federal Reserve predicted to maintain its near-zero target rate.

We Don't Have Honest Money
By Greg Hunter - USAWatchdog.com
My nephew, Luke, called me the other day vexing over the materials used in our coins. He is a finance major in grad school and was researching money when he discovered that pennies were 97.5 percent zinc and nickels were mostly copper with only a nickel coating. He told me he was going to start saving every pre-1982 penny he got because, after that, the mint stopped using 95% copper in the coin. Luke told me the copper in a pre-1982 penny was worth more than two cents. I told him, "Pretty soon the mint will have to punch coins out of plastic if the price of metal keeps going up." Then I asked, "Do you know why prices are going up?" Luke said, "Yes, it's because the Federal Reserve and its monetary policies." I was shocked and proud all at the same time! It looks like he's actually learning something in business school. Currently, it costs about 1.8 cents to make a penny and nearly 9 cents to produce a nickel. The government is considering cheaper metals to bring the cost of making coins down.

Marc Faber : I will never sell any gold !

Gold May Advance After Gaining to Record on Dollar Concerns
By Wendy Pugh
Sept. 21 (Bloomberg) -- Gold, little changed, may rise to a record for a fourth straight day driven by speculation that the dollar may weaken amid concern that the U.S. economic recovery could falter.
Bullion for immediate delivery traded at $1,278.95 an ounce at 11:49 a.m. Melbourne time after surging as much as 0.8 percent yesterday to an all-time high of $1,283.80. The Dollar Index, which measures the U.S. currency against six counterparts, dropped for a second day.

Gold closes in on fresh record high
Silver reverses lower, leaves 30-year high territory
By Claudia Assis and Myra P. Saefong, MarketWatch
SAN FRANCISCO (MarketWatch) - Gold futures traded at a new record high Monday, climbing above $1,280 an ounce as investment demand for the precious metal strengthened.
Silver turned lower, however, leaving 30-year high territory, and copper also reversed course after a brief time in the black.
Gold for December delivery rose $3.50 to $1,280.90 an ounce on the Comex division of the New York Mercantile Exchange, losing some steam as the end of floor trading approached. It earlier hit an intraday high of $1,285.20 an ounce.

Gold holds gains on economic worries
INGAPORE (Commodity Online): Gold prices continued its northern journey in Asian trade Monday, after hit record high last week, as investors worry about the economic recovery.
Gold for immediate delivery was seen trading at $1277.71 an ounce at 12.00 noon Singapore time while US gold futures for December delivery was seen trading at $1278.94 an ounce on the comex division of Nymex.
Analysts said sentiment stayed buoyant on speculation of more quantitative easing in the United States, as investors worry about the economic recovery.

Sobering Lesson for the World as Gold and Silver Set to Explode Higher
By: Howard Katz
As the old expression has it, there are: "None so blind as those who will not see."
The world is about to get a sobering lesson over the next year or two as the precious metals markets move explosively to the up side. As happens so often in the affairs of men, reality is there in front of us just sitting and being itself. Yet so few of the species homo sapiens can see it.
I have presented an alternative explanation for the blind stupidity of the Keynesian "economists" and their almost perfect record of being wrong. On March 9, 1933, Congress gave the commercial bankers the special privilege to create money out of nothing. Immediately the money supply began to increase, and today the price level is 17 times what it was on that day.

Golden Warning Lights
theTrumpet.com
Gold hit a new record high again on Friday: $1,277.50 per ounce. The precious metal has come a long way since Trumpet writer Ron Fraser wrote about it in 2002. Back then the precious metal traded for only just over $300 per ounce.
The benefit of hindsight, some might say: If only you had invested!
But the Trumpet watches the price of gold for other - far more important - reasons. For one, it is a bellwether of the global economic system and especially that of the U.S. dollar. For another, it is an indicator of where future global centers of finance will gravitate.

Gold, Oil and China
By Frank Holmes - The DailyReckoning.com
09/20/10 San Antonio, Texas - It's been a lively year for both gold and oil investors but the year to remember may be the one ahead.
Goldman Sachs is forecasting a 27 percent jump in energy and a 17 percent rise in precious metals over the next 12 months. On the oil side, Goldman credits a rebound in industrial production for a 520,000-barrel-per-day increase in China's implied oil demand in August (year over year). As you can see from the left-side chart, Chinese oil demand has remained a fairly consistent story going back several years.

$20 likely to be floor for Silver
.... David Morgan: My fascination really started as a teenager, particularly with the stock market and money. Once I started researching money, I found out that a stable monetary base usually requires the backing of precious metals. But that was just the beginning. What really got me motivated about the silver market was the first bull market that I was involved in through the 1970s into 1980. I wasn't that big a silver bull at that time. I was more of a gold bull, but silver outperformed gold at the end of the market cycle so substantially that I started to study silver more diligently. I wanted to know why.
The Hunt brothers were big investors in the silver market throughout the 1970s. Everyone explained the silver boom with "it's the Hunts," but I wanted to know why the Hunts put that much money into silver. Why didn't they buy gold? What fascinated the Hunts about the silver market? Once I dug deeper, there were significant factors outside the Hunt brothers that made silver a compelling study.

MUST WATCH: The Curious Case For $936 Ounce Silver.

Fed Issues More Debt as Gold Rises
Bob Chapman - Infowars.com
On Friday, September 10, 2010, Horizon Bank, Bradenton, FL was closed by the Florida Office of Financial Regulation and the Federal Deposit Insurance Corporation (FDIC) was named Receiver. No advance notice is given to the public when a financial institution is closed.
In site of intervention by "the Working Group on financial Markets", gold has increased almost 16% year-to-date. It has done so for each of the past ten years, which has gone almost unnoticed by professionals and investors. Obviously some are watching or the price wouldn't be where it is. Commodities have been up for 11 years and nine years for Treasuries. As you know we are trend followers, so gold and silver have been kind for our readers since June of 2000. That is after we bailed our subscribers out of the stock market in the second week of April of 2000. We were at a conference and Joe Granville made the same call on that sunny Saturday, so long ago.

Fed Injects Record $5 Billion Into Stock Market With Today's POMO
by Tyler Durden - ZeroHedge.com
Today's POMO is over, and the result is a whopper: Brian Sack has just injected a record for QE Lite $5.2 billion in stock, in order to complete all the elements of today's orchestrated Obama Town Hall meeting, during which the president is now fully expected to announce that he not only managed to end the recession singlehandedly (what an opportune time for the NBER to announce its results), but that stocks are now ripping every single time he appears on TV (same goes for gold, oil, and pretty much everything else: and furthermore, Treasurys are unchanged, refuting all of Mr. Pisani's BS about capital reallocation in process). $5 billion today, add another $6 billion on Wednesday and Friday, lever up 30 times and you have some $300 billion in free buying given to the Primary Dealers so they can ramp the S&P to 1,150 by the end of the month. Job well done Mr. President. Too bad nobody but Wall Street and a few HFT prop desks care about the stock market any more.

Jim Rogers - 'Fed will end when the Dollar is destroyed'

Obama notes report indicating end to recession;
Says struggling Americans still feeling it
Newser.com
Obama says much more work needed on economy
Appearing at a town-hall meeting sponsored by CNBC, Obama says times are still very hard for people "who are struggling," including those who are out of work and many others who are having difficulty paying their bills.
The National Bureau of Economic Research, a panel of academic economists based in Cambridge, Mass., says the recession lasted 18 months, starting in December 2007 and ending in June 2009. Previously the longest postwar downturns were those in 1973-1975 and in 1981-1982. Both of those lasted 16 months.
The president said Monday that it's going "to take more time to solve" an economic problem that was years in the making.

Hah, hah, hah!. . . .
U.S. recession ended June 2009, NBER finds
18-month downturn was longest since end of World War Two
By Jeffry Bartash and Ruth Mantell, MarketWatch
WASHINGTON (MarketWatch) -- The U.S. recession that started in December 2007 ended in June 2009, making it the longest slump since World War Two, according to the National Bureau of Economic Research.
The NBER, a nonprofit group that determines when recessions begin and end, said the economy bottomed out in June 2009, followed by a slow expansion. The group said the 18-month recession was the longest since a pair of 16-month slumps in 1973-75 and 1981-82.
Yet the NBER also cautioned that its findings bear no relation to the current state of the economy or represent a forecast about the future. If another downturn occurs anytime soon, the NBER said, it would constitute a separate recession.

Recession Over, but Weakness Remains
By MICHAEL S. DERBY And MICHAEL R. CRITTENDEN - WSJ.com (free)
The organization responsible for dating changes in the U.S. business cycle said the U.S. recession that started in December 2007 ended in June of last year, but a new report highlighted the weaknesses still facing the U.S. economy.
In a statement on its website Monday, the National Bureau of Economic Research said that in determining an end to the downturn, "the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity."

Urgent Steps to Save U.S. Economy From Debt Collapse
By: Larry Edelson - MarketOracle.co.uk
In a few moments, I am going to release to you - and the general public - the broad brushstrokes of my ...
10-Step Proposal To Save America From The Fatal Blows Of A Debt Collapse ... And Give Control Of The U.S. Economy Back To The American People.

Gerald Celente: US Economy = Depression

Shut Up! You're Disturbing the Elite
by Keith Johnson - Revolt of the Plebs
So many warnings, so many solutions, and so many people who couldn't care less.
LONG AGO: A man named Noah (the conspiracy theorist of his time) warns his people that a great flood is fast approaching. His preparations for the event are largely dismissed as crazy, and he is constantly the subject of ridicule and mockery. Even as the heavy rains turn torrential; the people continue to laugh, eat, drink and dance ... right up until the water level rises high enough to sweep them all away.

Obama: I Am Not Villifying Business
By: John Carney - Senior Editor, CNBC.com
President Barack Obama strongly denied vilifying businesses at CNBC's Town Hall event on Monday.
"In every speech, every interview that I have made I've constantly said what sets America apart, what has made us successful over long term, is we've got the most dynamic free-market economy in the world. And that has to be preserved. We benefit from entrepreneurs and innovators who are going out there and creating jobs, creating business. Government can't create the majority of jobs. And, in fact, we want to get out of the way of folks who've got a good idea and want to run with it and are going to be putting people to work," Obama said.

Art Cashin: This Could Spark 'Stampede' of Short-Covering
By: JeeYeon Park - CNBC News Associate
Stocks opened higher and climbed Monday, as investors awaited President Obama's comments on the economy and the Federal Reserve's policy meeting on Tuesday. Will stocks see a fourth week of gains? Art Cashin, director of floor operations at UBS financial services, discussed his outlook.
"I think you've got a 30 percent shot [at a breakout to the upside] - the critical area is S&P 1,130 to 1,133," Cashin told CNBC.
"If they blow out through that, we can create an algorithmic stampede of short-covering."

The Myth of Debt Deleveraging Deflation
By: Brady Willett - MarketOracle.co.uk
In the third quarter of 2008 households and non profit organizations (or 'consumers') had $14.6 trillion in total debt on their balance sheets. Since then the consumer has managed to reduce this number by a mere $652 billion. By way of contrast, after reaching $79.1 trillion in the third quarter of 2007, total assets have contracted by an astonishing $12.4 trillion.

Inflationary Understatement
By The Mogambo Guru - The DailyReckoning.com
09/20/10 Tampa, Florida - The Market Oracle newsletter jumps into the inflation-deflation debate, and says, "Debt deleveraging deflation completely ignores the fact that we are NOT living in the 1930's, but in a globalised world economy that is seeing the convergence of real GDPs where the developing world is eating up the [world's] resources at a faster pace then the west is cutting back on consumption."
Something in my Puny Mogambo Brain (PMB) went, "Ding!" when I instantly recognized this as a classic case of the age-old supply/demand dynamic where price equilibrates demand with supply, in this case the increasing demand from the "developing world" is swamping demand from the "developed" world, meaning an increased demand, but with no mention of the physical supply of resources, which are hard to increase and are, in the short run at least, absolutely fixed.

COLLAPSE OF THE U.S DOLLAR - (SUPER DEPRESSION)

British Government to Seize All Paychecks
Paul Joseph Watson & Alex Jones - Infowars.com
Forget big government - the same elite whose policies caused the financial collapse are now ready to launch the next phase of their fascist takeover of the economy - by forcing businesses to send employee paychecks straight to the government, who would then deduct the "appropriate tax" before the employee receives their wage, as the statist cancer of collectivism grows.
The proposal represents another hammer blow to financial privacy, as the establishment moves towards a total cashless society where every transaction is tracked, traced and controlled by the authorities.

Colorado near last among states in Q2 income growth rate
DENVER BUSINESS JOURNAL - BY Mark Harden
Total personal income in Colorado rose 0.8 percent in the year's second quarter from the previous quarter, one of the lowest rates of growth in the nation, according to a report Monday from the U.S. Bureau of Economic Analysis.
Colorado ranked 45th among the 50 states in the rate of its personal-income growth between the two quarters, with first meaning the highest growth rate and 50th the lowest.
The national income growth rate was 1 percent between Q1 and Q2 2010. North Dakota had the highest growth rate, at 2 percent, while Nevada had the lowest, 0.3 percent.

New law creates IRS paperwork for rental owners
By: Susan Ferrechio - Washington Examiner
Need a plumber to fix a sink at your rental property? Get ready to deal with the Internal Revenue Service.
A small-business bill poised to become law includes new tax reporting requirements for rental property owners and a second provision calling for steep increases in fines for any person or business who fails to furnish correct information to the IRS, such as 1099 forms for services and purchases.
The two provisions are tucked inside the Small Business Lending Fund Act, which passed the Senate Thursday. A report issued last week by the Joint Committee on Taxation calculates that the two provisions combined would raise about $3 billion of the overall $30 billion cost of the legislation.

Banks should share Fannie, Freddie expenses
By ALAN ZIBEL AP Real Estate Writer - via The Republican-American
WASHINGTON - The nation's largest banks have an obligation to pay some of the cost for bailing out mortgage buyers Fannie Mae and Freddie Mac because they sold them bad mortgages, a government regulator said Wednesday.
Edward DeMarco, the acting director for the Federal Housing Finance Agency, said the banks this summer have refused to take back $11 billion in bad loans sold to the two government-controlled companies, in written testimony submitted for a House subcommittee hearing Wednesday. A third of those requests have been outstanding for at least three months.

Real Estate's Double Dip
By: Michael Yoshikami - CNBC.com
Here comes the second dip down for real estate and how intense this drop is is going to largely determine whether we fall into a double dip recession.
This last real estate downturn moved prices down to levels many expected were not possible.
Well, get used to the unprecedented because we believe that prices will continue to drop to even lower levels. One needs only to look at the latest results from Kaufman and Broad and Pulte to realize that housing is still incredibly soft. Even retail sales numbers from Home Depotand Lowe's are still affected by the massive erosion in a real estate equity over the past several years.
Yes real state is still a weight around the economy's neck.

Housing data not expected to sparkle
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) -- Economists don't expect many bright spots in the economic data in the coming week that will highlight the gloom of a newly-crippled housing market and a factory sector that is running out of steam after leading the recovery.
The week will be dominated by the Federal Reserve's closed-door meeting on Tuesday to set monetary policy for the next six weeks. Economists don't expect the Fed to announce a second round of asset purchases on Tuesday although many see a plan in place before the end of the year.

Home builder index stuck at multi-month low
High unemployment, glut of foreclosures remain major obstacles
By Steve Goldstein, MarketWatch
WASHINGTON (MarketWatch) - Home-builder confidence remains mired at multi-month lows, according to a report released Monday by the National Association of Home Builders.
The NAHB/Wells Fargo housing market index remained at 13 in September, tying the August reading for the worst showing since March 2009 and coming in below MarketWatch-compiled economist estimates for a reading of 14.
At 13, the index remains far below the 50 line that indicates that more builders view conditions as good than poor. There hasn't been a reading above 50 since April 2006. The worst reading was 8 in January 2009.

Golden Opportunity for Social Security
J. Bradley Jansen - HuffingtonPost.com
Director of the Center for Financial Privacy and Human Rights
The time has come to get our financial situation in order. I'm not talking about the pros and cons of another stimulus or if the Bush/Obama plans "worked" or not, but a more substantive proposal. Let's get some of our gold back from the International Monetary Fund, monetize it, and put it in the Social Security Trust Fund.
My colleague Robert Naiman suggested we cut our IMF funds when they suggest cutting Social Security benefits. (He and I worked together opposing the IMF quota increase several years ago.) His idea was in response to Dean Baker's article, "The Attack of the Real Black Helicopter Gang: The IMF is Coming for Your Social Security." I think we should call it the "Anti-Geithner Plan" in honor of the "Washington Consensus"/US Treasury/IMF/New York Federal Reserve maestro.

How Census gets it wrong on poverty
By Bruce D. Meyer and James X. Sullivan, Special to CNN
(CNN) -- When the Census Bureau released its annual U.S. poverty report last week, the news looked grim. Poverty had risen to 14.3 percent in 2009 from 13.2 percent in 2008 -- the largest single-year increase since 1980. And there is no end in sight for those struggling to make ends meet, as unemployment has remained high throughout this year.
The general message of these latest numbers is clear: The most serious recession in a generation is taking a considerable toll on our nation's poorest families.
But in several important ways, the Census gets it wrong.
Census poverty figures are based on a narrow measure of income that often doesn't accurately reflect an individual's true economic circumstances.

The Poverty Solution: Marriage or Bust
By Robert Rector - NationalReview.com
Last week, new data from the U.S. Census Bureau revealed that the U.S. just saw the largest annual increase in poverty recorded in our nation's history: In 2009, 3.7 million more Americans joined the ranks of the poor.
The recession bears part of the blame, but media outlets have failed to inform the public about the long-term root cause of poverty in this country: unwed childbearing. Buried in the Census report are startling figures revealing that the collapse of marriage is creating this crisis of poverty. Single-mother families are almost five times more likely to be poor than are married couples with children; overall, nearly 70 percent of poor families with children are headed by single parents.

For the Unemployed Over 50, Fears of Never Working Again
By MOTOKO RICH - NYTimes.com
VASHON ISLAND, Wash. - Patricia Reid is not in her 70s, an age when many Americans continue to work. She is not even in her 60s. She is just 57.
But four years after losing her job she cannot, in her darkest moments, escape a nagging thought: she may never work again.
College educated, with a degree in business administration, she is experienced, having worked for two decades as an internal auditor and analyst at Boeing before losing that job.
But that does not seem to matter, not for her and not for a growing number of people in their 50s and 60s who desperately want or need to work to pay for retirement and who are starting to worry that they may be discarded from the work force - forever.

Individual health premiums rise 3.7 percent
KANSAS CITY BUSINESS JOURNAL
The average individual health care premium increased 3.7 percent this year from 2009, according to a study of plans bought from eHealthInsurance
The study, conducted by the website's parent eHealth Inc. (Nasdaq: EHTH), includes 316,000 individual and family policies bought through eHealthInsurance active in February 2009 and 384,000 policies that were active February 2010.
Plans available on the website had average monthly premiums of $161 in 2009 - that increased to $167 in the past year. Monthly premiums in Kansas and Missouri, however, were much lower than the national average this year. Kansas' average was $120.07 a month for individual plans. Missouri's average was $125.92.

FDA Opens Hearings on Genetically Modified Salmon
Associated Press via WSJ.com (free)
WASHINGTON - Federal food regulators pondered Monday whether to say, for the first time, that it is permissible to market a genetically engineered animal as safe for people to eat.
The Food and Drug Administration is holding two days of hearings on a request to market genetically modified salmon. Ron Stotish, CEO of AquaBounty, the Massachusetts company that made the marketing request, said at the meeting Monday that his company's fish product is safe and environmentally sustainable.

Gerald Celente on Wisconsin Public Radio Ben Merens

Apple said to plan online newsstand with publishers
A proposed digital newsstand would let publishers sell magazines and newspapers to consumers for use on Apple devices, say two people familiar with the matter.
Crain's New York Business - crainsnewyork.com
(Bloomberg) - Apple Inc. is developing a digital newsstand for publishers that would let them sell magazines and newspapers to consumers for use on Apple devices, said two people familiar with the matter.
The newsstand, designed particularly for the iPad, would be similar to Apple's iBook store for electronic books, said the people, who declined to be identified because the negotiations are private. The newsstand would be separate from Apple's app store, where people can buy some publications now, they said.

Rovi Signs Technology Pact With Apple
By DAVID BENOIT - WSJ.com (free)
NEW YORK - Rovi Corp. said Monday it signed a multi-year deal with Apple Inc. that allows Apple to use Rovi's technology, and while the company declined to give more details, shares leapt to a nine-year high.
Rovi, which said all other details with the tight-lipped Apple are confidential, makes content-management software and programs for consumers electronics and services. Its products include interactive programming guides and licensing technologies that help users find and locate programs, as well as make recommendations, inside services like Apple's iTunes or cable systems.

72 Hour Notice to Fly in the US After Nov 1?
As a result of the Transportation Security Administration (TSA) and Department of Homeland Security (DHS) mandate, beginning November 1, all passengers will be required to have Secure Flight Passenger Data (SFPD) in their reservation at least 72 hours prior to departure. This is the next phase in a program that was initiated by the TSA in 2009.
In compliance with this mandate you will be required to provide Secure Flight Passenger Data:

• To purchase any ticket on or after September 15, 2010
• To travel November 1, 2010, or later regardless of purchase date
  You will be unable to travel without providing the following information.
• Full Name (first, middle and last name, as it appears on the non-expired government-issued photo ID that you will use when traveling)
• Date of Birth
• Gender
• Redress Number (if applicable)

The Shocking Truth About Money - Interview with Ellen Brown 1 of 2 Author Ellen Brown ("Web of Debt") reveals the shocking truth about money in the United States. In this 25 minute interview, Follow the Money Weekly radio host Jerry Robinson asks the tough questions about money, debt, and the Federal Reserve in America.

The Shocking Truth About Money - Interview with Ellen Brown - 2

Then there's Obama's favorite special interest, unions
By: Mark Hemingway - Washington Examiner
At a speech in Connecticut last Thursday, President Obama warned that "special interests are planning and running millions of dollars of attack ads against Democratic candidates."
For this sorry state of affairs, the president went on to blame the Supreme Court's Citizens United decision earlier this year, which ruled that many campaign finance laws violated the First Amendment. "None of them will disclose who's paying for these ads. You don't know if it's a Wall Street bank. You don't know if it's a big oil company. You don't know if it's an insurance company."
A White House official further told Politico's Mike Allen last week that the president plans to talk "a lot" about the "corporate takeover of our elections."

A Bullish Tea-Party Revolt
By: Larry Kudlow - CNBC Anchor
This past week I gave a speech to a group of investors. The organizer of the event e-mailed me the night before, asking that I please try to be optimistic. Well, that's my usual habitat. But optimism has been hard for me this year. Our muddle-through economy and lackluster stock market, challenged by so many taxing, spending, and regulating problems coming out of Washington, are the reasons why.
In fact, until recently, I've been advising people to take profits in the stock market, rather than buy-and-hold. You should keep your money before the Obama IRS takes it from you.

"Poll After Poll Shows That Both National Parties Are Deeply Unpopular With An Electorate Looking For Something New And Different"
Washington's Blog
As I noted a year ago:
Famed trend forecaster Gerald Celente is predicting that a third party candidate will be elected President in 2012....
***
The willingness of Obama/Emanuel so blatantly to disappoint those to whom they promised so much (especially young and first-time voters who were most vulnerable to Obama's transformative fairy dust) will lead them either to support a third party or turn off from politics altogether.

Battle for the Indian Ocean
Ron Fraser - theTrumpet.com
Two powers vie for control of one of the globe's most strategic seaways.
A battle royal is emerging over control and strategic influence in the Indian Ocean. Two emerging powers are vying to fill the void that is inevitably going to be created in the wake of increasing U.S. weakness.
It is inevitable that America's unsolvable economic woes are going to increasingly hit the bottom line in its military expenditures. No matter how impressive the multibillion-dollar Pentagon budgets sound, one thing is certain - they cannot remain sustainable for long given the rapidly tanking U.S. economy. With the very best of analysts agreeing that the U.S. administration has run out of workable options for resurrecting the nation's fiscal viability, rising global powers are increasingly cocking a snook at the once dominant superpower.

FYI - in depth and interesting pseudo-intellectual discussion of conflict between Islam and America from NON-TinFoil point of view; Chris Hedges shows his blatant ignorance of who conservatives really are, by and large, but it is an interesting discussion and one you should be aware of because the issues are not going away anytime soon. They still don't 'get' where the real conflict lies. . . . much deeper than politics.

Empire special - Islam and America

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Monday 09.20.2010

Bankruptcy & Closures:
Six More Bank Failures Makes 125 in 2010
247WallStreet.com
The banking devil is still heading down to Georgia, looking for bad bankers' souls to steal. The problem is that Georgia had just three of the six banks closed down on Friday. "Just..." Ohio, New Jersey and Wisconsin all got a bank closing each on Friday as well. 2010 has now seen 125 bank closures, with six in a single weekend marking one of the highest weekend tallies this year and setting 2010 to be a worse year for bank closings versus 2009.

America Out of Work
A rising sense of futility
A 54-year-old former machinist finds his options limited after losing his job two years ago.
By Alana Semuels, Los Angeles Times
In four decades in the working world, Raul Vargas has been a musician, a salesman and a construction worker. But since getting laid off from his machinist's job, Vargas hasn't landed anything but occasional day labor stints moving furniture or doing yard work.
The downturn has been tough on former factory hands such as Vargas. U.S. manufacturers have shed more than 1.6 million jobs over the last two years; these workers, on average, have remained jobless longer than the long-term unemployed in most sectors.

Gold Price Breakout, The Ominous Silent Canary
Jim Willie CB - SilverBearCafe.com
Alan Greenspan had full knowledge of his betrayal to the principles of sound money. He wrote early in his career about the only legitimate basis for a monetary system, namely Gold. His published works from four decades ago read like an indictment against his career for monetary crimes against the nation. His accommodation, giving the financial sector what they wanted, betrayed his mindset. He knew the nation courted disaster with a long delayed fuse. His quote is being circulated frequently and broadly lately, "Gold is the canary in the financial coal mine." Exactly, precisely, perfectly. Greenspan proved to be a great handler of the politicians, offering them obfuscation of the most erudite variety. They were so confused by his drivel to be immensely impressed.

Gold hits new peak of $1,283
Gold struck fresh record highs on Friday as the dollar waned on mounting expectations that the Federal Reserve will pump more money into the flagging US economy.
By Richard Evans - Telegraph.co.uk
Neil MacKinnon, an analyst at VTB Capital, told AFP: "Gold is making a new high and stocks are rallying because the markets think the Fed will print more money before the end of this year just to ensure that the US economy remains on an even keel.
"The risk for investors is that the US economy does actually fall into a 'double-dip' [recession] and not the 'soft landing scenario' which the markets are currently discounting."
Gold struck an all-time high close to $1,283 an ounce on Friday after chalking up a series of records this week. It hit $1,282.97 on the London Bullion Market before easing slightly to stand at $1,280.95.

Gold: The Luster Is Back
Clemens Kownatzki - SeekingAlpha.com
Gold has been "back in the game," so to speak, for a good decade now; in fact, it's not just been back, the price of Gold has increased almost fourfold since 2000 - not bad at all compared to the otherwise "lost decade" of investment returns.
This week alone, there were three new all-time price records for the shiny metal. The big impetus for the near $30 price jump earlier this week was the news that central banks would be net buyers of Gold for the first time since the late 1980s, purchasing about 15 tons of bullion this year.

Gold heading for $1300/ounce
LONDON (Commodity Online): Gold reached record highs above $1,280 while silver chalked up new 2-1/2 year gains on Friday on a soft dollar and concerns that more cash injections may be needed to sustain the global economic recovery.
Gold's gains came as the dollar retreated further against the euro, reaching new one-month lows of 1.3148.
A weaker dollar makes gold cheaper for holders of non US-denominated currency. The traditional relationship with the dollar is back on and amid quantitative easing fears. Everybody seems to be looking at $1,300 and it looks like we will get there.

Goldman says over to $1,300 gold could accelerate
By Allen Sykora of Kitco News
(Kitco News) - Goldman Sachs says there are some potential factors that could speed up gold's rise to the investment bank's six-month target of $1,300 an ounce.
However, Goldman also lists a long-term risk. "For gold, we maintain that the low U.S. real interest-rate environment will allow prices to continue to move higher, with a 6-month target of $1,300/oz," Goldman says.

Jim Rogers: Gold bull market has a long way to go
By Daniela Cambone of Kitco News
Singapore - Global commodities investor Jim Rogers says gold's rally and record prices are a sign that money printing is starting again and the gold bull run is far from over.
"The US has been giving the signal that it is going to print more money and Japan has recently said they are going to print more money - what is happening is that money printing is starting again and the market knows it," he told Kitco News in an exclusive interview on Wednesday.
Gold on Thursday extended the record highs hit just three days ago. Comex December gold peaked at $1,279.50 an ounce early Thursday, a record for any most-active contract. Spot gold hit a record high of $1,278.90.

Marc Faber says gold prices not expensive
Dr. Doom still bullish on gold bullion
By Chris Oliver, MarketWatch
HONG KONG (MarketWatch) - Gold's rise to a fresh record Friday won endorsement from financial advisor Marc Faber, who said the rally in bullion prices didn't appear excessive in view of the inflationary backdrop and ongoing bias of the world's monetary authorities towards weak currencies.
Faber, known as Dr. Doom for his bearish call on U.S. stocks shortly before the crash of October 1987, said he would continue to be a buyer of bullion at current levels.
"Given all the unfunded liabilities and the money printing in the world and the size of the financial assets in the world, I don't think we are in a bubble," Faber told a CLSA Investors' Forum 2010 in Hong Kong.

Gold Forecast $2,500, Silver Could Easily Reach $180
By: Lorimer Wilson - MarketOracle.co.uk
More than 95 respected economists, academics, analysts and market commentators are of the firm opinion that gold will go to $2,500 and beyond before the parabolic peak is reached. In fact, the majority (55) think a price of $5,000 or more - even as high as $15,000 - is actually more likely! As such, just imagine what is in store for silver given its historical price relationship with gold!
Precious metal bull markets have 3 distinct demand-driven stages and we are now quickly approaching or perhaps even in the very early part of the last stage which occurs when the general public around the world starts investing in gold and this deluge of capital into gold causes it to escalate dramatically (i.e. go parabolic) in price.

Will Silver de-couple from Gold?
By Julian D.W. Phillips - CommodityOnline.com
Has silver been coupled to gold?
For the last few years silver has moved in relative tandem with the gold price up to now. We called it the 'long shadow of gold' because it would rise further and fall further than gold, but they did move together. Occasionally silver did pause as gold rose but the 'shunt' effect [when a train pulls forward with a line of carriages in tow and each jumps forward as their links tighten] kicked in and it jerked forward to catch up with gold's moves. Many investors keep their eyes focused on the Gold: Silver Ratio [one ounce of gold buys x number of ounces of silver] and trade it regularly. Right now that ratio is at 1: 60. However, by coupling we also mean will they continue to act and react together on a daily basis, apart from price differentials.

Gold Is On the Move
By Mary Anne & Pamela Aden - SeekingAlpha.com
Gold is looking good. Since its summer low of $1160 in late June, it has surged to $1275. That's a nearly 10% gain in less than two months, and even though gold has again broken its all-time record high, it's poised to move still higher.
What's Driving the Gold Price Up?
There are several key factors coming together at the same time and all of them are bullish for gold. But if we had to boil it down, the bottom line is uncertainty. This makes investors nervous, which has always been good for gold. But is this response rational?
We think so. Gold is the ultimate safe haven and as the economy stumbles, demand for gold has grown. That's been the case for almost a decade. In the second quarter of 2010, for instance, the economic indicators were down and gold demand was up 36%.

$2,500 Gold Could Easily Result in $178.50 Silver - Here's Why!
By: Lorimer Wilson - SilverSeek.com
More than 95 respected economists, academics, analysts and market commentators are of the firm opinion that gold will go to $2,500 and beyond before the parabolic peak is reached. In fact, the majority (55) think a price of $5,000 or more - even as high as $15,000 - is actually more likely! As such, just imagine what is in store for silver given its historical price relationship with gold!
Precious metal bull markets have 3 distinct demand-driven stages and we are now quickly approaching or perhaps even in the very early part of the last stage which occurs when the general public around the world starts investing in gold and this deluge of capital into gold causes it to escalate dramatically (i.e. go parabolic) in price.

Gold Demand and Price Are Rising, Can Supplies Keep Up?
Przemyslaw Radomski - SeekingAlpha.com
This essay is based on the Premium Update posted on September 16th, 2010
It seems that demand for gold is rising faster than supply. It doesn't take a degree in economics to understand that if the price of something soars by some 350% you would want to dig more of it out of the ground and sell it. But mine production has remained flat even as investor demand more than doubled so far in 2010 compared to a year earlier.
Looking back at recent history the best year for mine production was in 1999 when 83.69 million ounces of new gold came out of the ground. Keep in mind that in that year the price of gold was under $300, hitting a low of $256.

Gold Rebounds, Dollar Plummets, Higher Inflation is on its Way...
By: Bob Chapman - MarketOracle.co.uk
Gold has again broken out to new highs and silver is on the cusp of doing so as well. Unfortunately more than 95% of the pundits were not on board; they believed it was going lower.
The fight for monetary supremacy between the dollar and gold for over the past 16 months has been won by gold and that is why gold is moving higher and the dollar lower. The recent intervention in the currency markets by Japan, ostensibly to weaken the yen, assisted by the US and foreign central banks, won't strengthen the dollar for any appreciable period of time. The US dollar has broken down and there is no going back.

Gold, Silver, Economy + More
By: Bob Chapman - SeekingAlpha.com
Gold has again broken out to new highs and silver is on the cusp of doing so as well. Unfortunately more than 95% of the pundits were not on board; they believed it was going lower.
The fight for monetary supremacy between the dollar and gold for over the past 16 months has been won by gold and that is why gold is moving higher and the dollar lower. The recent intervention in the currency markets by Japan, ostensibly to weaken the yen, assisted by the US and foreign central banks, won't strengthen the dollar for any appreciable period of time. The US dollar has broken down and there is no going back.

Swapping Gold for Silver Has Historical Merit
By: Dr Jeff Lewis - MarketOracle.co.uk
Precious metals investors are very much in tune to the silver to gold ratio. The ratio, which commonly trends between 20:1 to as high as 70:1, should be used as a guide to determine which precious metals will rally and when. Today, silver is at the top of the silver to gold ratio at just over 62:1, so according to history, those who swap their gold today will see higher appreciation in silver in the months and years that follow.
Swapping for Greater Appreciation
We'll have to travel in time back to 2003 to find a time when the gold to silver ratio was even remotely close to where it is today. In 2003, the ratio peaked for the last time at nearly 80:1. Since that time, gold has risen from $320 per ounce to $1240 per ounce. Silver, on the other hand, has risen from $4.80 to more than $20 per ounce. Silver racked up a 416% gain in seven years while gold lagged, but still beat any other market with a 387% gain.

It's Silver Season!
By: Dr Jeff Lewis - MarketOracle.co.uk
Back to school for some, the days before hunting seasons for others, but for silver investors, this time of the year is nothing more than silver season - the time when silver skyrockets to finish out the year.
Well Defined Trend
Excluding 2008, spot silver prices have typically soared in the last three to four months of the year. In 2006, silver added more than 13% in the last three months of the year. In 2007, silver tacked on nearly 50% in the last four months of the year. In 2009, silver gained 20% from September to the first of January. Thus, with this trend clearly still on, you should be buying.

Is Silver The Next Gold?
Abigail F. Doolittle - SilverBearCafe.com
With gold hitting a historic high this past Tuesday only to have it taken out yesterday, I thought it might be timely to take a look at another precious metal on the move: silver.
Specifically, do the charts and the basic fundamentals support the sense that silver is set to continue its recent run as well? And perhaps more tantalizing, is there any evidence that points to the idea that silver can take out its more than thirty-year-old record high of roughly $50 per ounce?

The Congress and Your Gold
Congress Has Met the Enemy - and It is Itself
NYSun.com Editorial
What an astonishing set of issues has been opened up with the announcement yesterday by Congressman Anthony Weiner that he will hold a hearing on what he calls "TV Gold Dealers." The congressman put out on his Web site yesterday a statement that makes the hearing seem like it will prepare a Weinerian form of a bill of attainder against Goldline International and Glenn Beck. Goldline is a dealer that Mr. Weiner characterized as using "conservative spokespeople like Fox News' Glenn Beck to sell overpriced gold coins."
It seems that one of the advantages perceived in respect of gold coins, as opposed to bullion, is that they would be less likely to be confiscated were the government to try in the current economic crisis, when the value of the dollar has collapsed to less than a 1,200th of an ounce of gold, to confiscate gold the way another Democratic administration, FDR's, did during the Great Depression. Mr. Weiner seems to think that worrying about another Great Depression should be illegal.

Currency War
The Economic Collapse via SilverBearCafe.com
Are you ready for a currency war? Well, buckle up, because things are about to get interesting. This week Japan fired what is perhaps the opening salvo in a new round of currency wars by publicly intervening in the foreign exchange market for the first time since 2004. Japan's bold 12 billion dollar move to push down the value of the yen made headlines all over the world. Japan's economy is highly dependent on exports and the Japanese government was becoming increasingly alarmed by the recent surge in the value of the yen. A stronger yen makes Japanese exports more expensive for other nations and thus would harm Japanese industry.

The IMF itself has become the problem as Europe's woes return
Once a quorum of big names says the game is up in a debt crisis, events move fast and furiously.
By Ambrose Evans-Pritchard - Telegraph.co.uk
Portugal neared the line on Friday when Di‡rio de Noticias cited three ex-finance ministers warning that the country might have to call in the International Monetary Fund (IMF).
One spoke of a "reckless reliance on foreign debt"; another spoke of "runaway public spending". No matter that all were complicit in euro membership, the policy that incubated this crisis and now traps Portugal in its depression.

Can the Fed Offer a Reason to Cheer?
By TYLER COWEN - NYTimes.com
REMEMBER the song "Put On a Happy Face"? Just smile, it says, and you'll "spread sunshine all over the place," even if you don't start out feeling very happy yourself.
In many ways, this is fine advice. But if you've ever tried to act on it, you know that it's not always easy to wish optimism into existence.
Optimism, or lack thereof, may seem the province of psychology, not macroeconomics. But the issue is very relevant to the difficulties that policy makers face: a deficit of optimism has much to do with why the United States economy remains stalled today.

Economists: Extend Bush tax cuts for everyone
by Chris Isidore, senior writer
NEW YORK (CNNMoney.com) -- With income tax rates set to go up on Dec. 31, Congress is hotly debating what to do next. But most economists agree: Keep them where they are.
One option, to let the tax cuts passed during the Bush administration expire for only the richest 3% of taxpayers while renewing them for everyone else, is popular among Democrats and the choice of the Obama administration.
But a panel of leading economists surveyed by CNNMoney.com disagreed.

The Fed Talks Too Much
by Bruce Krasting
Another interesting week in the markets. We saw some records broken. It is worth asking the question, "Why did this happen early in the week, and why did it reverse as the week progressed?" I have a theory. I'll leave it to you to see if it adds up. The early week highlights I thought were important:

1. The dollar hit a new all time low versus the Japanese Yen. This prompted the BOJ to intervene. The first time in six years.
2. The CHF fell below parity versus the dollar (for only a half-day).
3. Gold went on a tear.
4. The dollar got weaker across the board.
5. The 10's - 30's Treasury spread widened while the 2's - 10's spread narrowed.

United States versus China, Currency and Trade Wars
By: Richard Mills - MarketOracle.co.uk
The Chinese government, in an effort to maximize exports and minimize US imports prints their yuan to buy dollars. This prevents their currency from rising and the dollar from falling. Then it loans those same dollars back to America by buying US debt.
At the same time China:

• Puts in place purchasing restrictions
• Permits piracy
• Delays legitimate items from entering the country
• Provides massive direct subsidization of export production in many key industries
• Maintains strict non-tariff barriers to imports

In 2009 U.S. imports from China were worth $296.4 billion. U.S. exports to China equaled $69.5 billion. In the first half of 2010 the U.S. trade gap with China equaled $119.5 billion.

Leaders face 'ambitious path' at G20 in Seoul
By Gerald Helguero | IBTTimes.com
Looking ahead to the next G20 meeting in Seoul this November, leaders from the world's top 20 economic powers will continue to evaluate each other's progress on their shared highest priority of safeguarding and strengthening the global economic recovery.
Leaders "concluded that we can do much better" at their last meeting in Toronto in June, by looking at their achievements through a "Mutual Assessment Process" established at a meeting in September of 2009.

Bond Markets Get Riskier
Demand for High-Yield Junk Bonds Boosts Prices;
Investor Protections Decline
By CARRICK MOLLENKAMP and MARK GONGLOFF - WSJ.com
Bond markets are growing riskier as investors seeking steady returns bid up prices and ignore some early warning signs similar to those that flashed during the credit bubble.
Last week, prices on high-yield, or junk, bonds hit their highest level since 2007, nearly double their lows of the credit crisis. Nine months into the year, companies have sold $172 billion in junk bonds, already an annual record, according to data provider Dealogic.

The Chances of a Double Dip
By Gary Shilling - SeekingAlpha.com
Investor attitudes have reversed abruptly in recent months. As late as last March, most translated the year-long robust rise in stocks, foreign currencies, commodities and the weakness in Treasury bonds that had commenced a year earlier into robust economic growth - the "V" recovery.
As a result, investors early this year believed that rapid job creation and the restoration of consumer confidence would spur retail spending. They also saw the housing sector's evidence of stabilization giving way to revival, and strong export growth also prop