Again, I apologize for the long delays between postings. It has been a very trying time for me. In the future, I will not be able to post as often as I did in the past. The conditions have changed that would make that impossible. But, I will still try to make sense of this crazy financial world and share that with you.
Since we have been in some extremely crazy times in the last several weeks (especially the last two with all the talks of the bailout packages), I thought it fitting to review some of the warnings I issued in this blog. You can be the judge on how accurate I was.
Friday, November 2, 2007... gold is $806.40, silver is $14.55, oil is $95.93 per barrel ...
The Federal Reserve lowered interest rates another quarter point to 4.5% on Wednesday to bolster the money supply and keep the economy moving. ...
The foreign exchange rates for the Great British Pound, the Euro, the Swiss Franc were all at multi-decade highs against the US dollar.
What does all this mean? The US dollar is getting weaker and weaker, eroding purchasing power of all consumers, increasing the US trade deficit and sending more money out of the country and even less entering. All of this leads to increased pressure for inflation. Now, with the Fed lowering interest rates again this week, they are trying to increase the money supply which further increases inflationary pressures. ... Gas prices will just be one of many things that will cost a lot more.
The road up ahead curves ... stay tuned.
Saturday, November 17, 2007We are not looking at an eruption, but an implosion of the economy resulting from many factors. The sub prime crash is only one indicator. The declining real estate market, the eroding value of the dollar, the rising prices of more intrinsic precious metals are climbing such as gold and silver, and the continued rising price of oil. All of these are signs.
Now, to fast forward some. When you factor in Social Security facing insolvency within the next decade; and add in the imminent failure of MediCare and MediCaid coupled with the rising number of baby boomers retiring (or trying to), and inflation rising. All of these indicators are leading up to a 'perfect storm' developing. Never before have all of these factors come together at once.
Wednesday, November 21, 2007When the sub-prime loan issue started happening in August, adjustable rate mortgages were going up and people who couldn't afford the increases started defaulting on their payments. The decrease of incoming funds to the banks started restricting what they could lend out. Private banks had to bail out smaller banks by lending federal funds to keep them open. Then the loans started going into foreclosure, and more money had to be loaned to keep the banks open. Still, thousands of people lost their homes.
This was really bad for our economy, but it was leading to something far worse. The Federal Reserve, dropped the discount rate by 1/2 of percent in their September meeting, a big drop. They had to create more credit to keep the money moving. They again lowered the discount rate another 1/4 percent in October. They were willing to risk inflation to keep the economy from completely stalling. The sudden influx of cash and credit spurred on inflation. With the increasing cost of gas and now consumer goods, everything started going up. As mentioned yesterday, when costs rise and wages don't keep up, the overall economic situation for the consumer decreases each year.
Saturday, December 1, 2007... Based on the beginning of wave 1 around Aug. 20 at $660 per ounce, gold will very likely go up to a minimum of
$960 from its point now in the coming months. The upper target is $1250 per ounce. This wave 3 will likely happen over the next six months. ...
The Elliott Wave target prices for silver on the low end is
$18.00 per ounce and the upper target is around $24.50.
Saturday, December 8, 2007Did you ever notice that the price of gas at the pump goes up almost immediately when oil prices go up? However, when the price of oil goes down, the price at the pump is slow to react. Interesting. Someone is making a lot of money on those slow fluctuations.
Monday, December 10, 2007The first thing you have to understand is that oil is the currency of the world. Every 1st world country is heavily influenced by the price of oil because of its dependency on oil for energy, transportation, and manufacturing. How long could you or anyone you know last without filling up your car with gas?
The key thing to remember that as one asset classes increases, other classes will either follow suit because they are linked, or act conversely because of the inverse relationship.
Friday, December 14, 2007So when the flow of money is controlled globally and nationally, it has a direct correlation to how businesses and consumers respond. The price of oil and interest rates are just some of the key variables that they use to dramatically influence the state of the world. Their ultimate goal is to have a world government and complete control over all financial matters. If we ever get to a cashless society, they would control who could buy or sell anything. Naturally, credit card companies would love this idea. Controlling the rates of exchange and money supply is not enough for them. Absolute power corrupts absolutely.
Saturday, December 15, 2007This past week I've been discussing the inter-relationships among a number of key indicators that drive the world economy. With the price of oil at near record highs and the fallout of the sub-prime mortgage crisis, the global economy was at an edge and was in danger of going into hyperinflation followed by depression. Thousands had lost their homes to defaults, and many banks were on the verge of bankruptcy due to the reduced cash flow from the defaults.
On Thursday Dec. 13th, the 5 major central banks from around the world (the Federal Reserve, the Bank of England, the European Central Bank, the Swiss National Bank, and the Bank of Canada), pooled $114 billion to prop up the global economy by injecting cash into the money markets. On Monday, the Fed will auction off $20 billion in loans and accept a wide range of collateral to spur on the economy. The Bank of England will auction off 11.35 billion pounds on Tuesday. "The banks hope that the new term auction facility at favourable rates will boost liquidity, ultimately benefiting their economies by making it easier for businesses and consumers to borrow money to invest and spend on goods and services."
My personal take on this latest move is that the imminent collapse of the US economy was happening faster than expected. Drastic measures never taken before had to be implemented because some elements of the plan were not fully in place.
Saturday, December 29, 2007...gold and silver both shot up in value to $839.50 per ounce and $14.81 per ounce respectively.
In January, I expect this trend to continue and even pick up speed. Since putting 114 billion available to banks in loans has not encouraged spending, the value of the dollar will continue to plummet. This will spur on inflation. Double digit inflation for 2008 will almost be assured. The Fed will continue to reduce interest rates, but it will likely slow things down just temporarily as it has since Sept. Gold and silver and other precious metals will continue to climb in value as I mentioned on my Dec. 1st post. The target price I set for gold is $1250 and silver is $24.50 per ounce within 6 months. Those even may be low considering the perfect economic storm that is developing.
The wildcard that remains is what will happen to the price of oil. If oil continues to go up significantly in early 2008, that will accelerate things considerably. If oil inches up, it will be more gradual. The other major developments that can strengthen the economic storm will be events like the US invasion of Iran and the replacement of the US dollar with the Amero. However, I do not expect these events to happen until 2009.
Saturday, January 12, 2008I've also mentioned that the US dollar has been losing its value over the last year. This has been one of many reasons why gold and silver has been appreciating significantly. The dramatic steps that the Federal Reserve has taken to prop up the dollar has risen the value of the dollar temporarily, as stated in previous Saturday posts. However, since Christmas, the value has started to plummet again, just as I pointed out it would. This week, the US dollar index fell to 76.02.
This is having a ripple effect on other markets as well, as I have also pointed out in previous posts. The stock market is starting to feel the pinch of the sluggish economy. Since the beginning of the 4th quarter, the NASDAQ has fallen more than 6%. The Dow Jones Industrial Average has also dropped 5.6%.
The point I am reiterating is that the economy is headed for a fall. Over the past several months I've given many reasons for this, but the facts are being validated each week. The signs are there.
Saturday, January 26, 2008This week was very interesting in the financial world. On Monday, the markets were closed in the US because of Martin Luther King, Jr. day; however, stock markets worldwide sank drastically amid concerns about the overall health of the US economy and a pending recession. The current credit crunch as result of last August's sub-prime mortgage meltdown makes the matters worse. These concerns heightened this week due to declining corporate profits and the worse housing report on record. For the first time on record, year-over-year housing prices dropped 13% against 2007 prices. This caused the Federal Reserve to take a drastic step.
Before trading opened on Tuesday, the Fed slashed interest rates three quarters of a percent or 75 basis points. The federal funds rate now is 3.5% and the discount rate was lowered to 4.0%. This was the largest rate drop in 24 years. This move came 8 days before their next scheduled meeting suggesting that they are responding to a problem that couldn't wait. Immediate stimulus to the economy is needed to prevent the market from going into a free-fall.
Saturday, February 2, 2008The biggest economic problem in history has not been of wars, but what has led to those wars. That is greed.
This week gold closed at $908.70. Silver continued its upward trend to close at $16.84 per ounce. The US dollar index continued its slide to close at 75.47 against the other world currencies. It is nearing an all time low of 74.50, set just a couple months ago.
On Wednesday, the Federal Reserve cut interest rates another 50 basis points, knocking the federal funds rate to 3.0% and the discount rate to 3.5%. The Fed is doing everything it can to keep the economy moving by making cheap money available to banks and businesses. Even the analysts are having a hard time denying that a recession is in full swing.
Nathan Rothschild manipulated the market when Napoleon lost at Waterloo. He sold British bonds at the top of the market and bought them back for a fraction of their worth later that afternoon. By the way, do we have a war going on now? Do we have huge companies and a few bigwigs that are getting rich over the miseries of others in Iraq and Afghanistan? Incidently, what is Iraq and Afghanistan known for? Iraq has lots of oil fields and Afghanistan is the closest path to the sea for oil pipelines from rich oil fields in the southern part of the former Soviet Union. Is the war really on terror or is it just a way to get immense profits?
Furthermore, there will be others today that buy houses, loans, commodities, etc. when prices hit rock bottom. However, we have not come close to hitting rock bottom yet. The economic storm is only getting started. We still have Social Security, Medicare, and Medicaid facing insolvency in the coming years. How will millions of baby boomers pay for their "necessary" prescription drugs after they retire?
Rest assured, there will be people that will profit immensely from these contrived events. Will you just be another victim of their greed?
Saturday, February 9, 2008The sub-prime mortgage debacle means nothing to most people except the thousands that lost their homes. A recession doesn't mean much to people until their jobs are downsized. A depression starts waking people up, but usually too late. Bank failures are not new (remember the Savings & Loan scandals of the 1980s), but that will wake up some more people. How many banks have been bailed out in the last several of months?
Saturday, February 16, 2008Today our dollar has the same buying power of 4 cents when compared to the same dollar in 1913. That year we had no national debt, today it is above $9 trillion and rapidly growing.
Is it going to take another stock market crash similar to 1929 where it lost more than 33% of its value in a month before we awake to the implications? The price of gold has gone up more than 50% in the last 18 months to $902.50 as of Friday from $560 per ounce in October of 2006. Silver has also gone up more than 50% in the same time period from $11.01 per ounce to $17.11 on Friday. Oil has hit again $95 a barrel, closing at $95.69 on Friday. The US dollar index closed at 76.03, less than one and one half points off an all time low against the other major world currencies. Can we not see the signs?
Incidentally, we should be aware of an escape clause that we have. This is the very one that presidential candidate Ron Paul is just hoping he can invoke if elected. The last provision of the Federal Reserve Act of 1913, Sec. 30, states, "The right to amend, alter or repeal this Act is expressly reserved." This language means that Congress can at any time move to abolish the Federal Reserve System, or buy back the stock and make it part of the Treasury Department, or to alter the system as it sees fit. It has never done so.
Monday, February 18, 2008It is interesting to note that President Bush and his administration has spent more money than all other presidents combined. And that was just in his first term! Melanie Hunter, a CNSNews.com Senior Editor, on November 4, 2005, reported that according to the Treasury Department, from 1776-2000, the first 224 years of US history, 42 US presidents borrowed a combined $1.01 trillion from foreign governments and financial institutions, but the Bush administration borrowed $1.05 trillion in his first term as president alone. Do you think spending has gone down in his second term?
Saturday, March 1, 2008This last Friday, gold closed higher again at
$975.10 per ounce. Silver, also up, closed at
$19.86 per ounce. Oil rose again and closed at $101.79 per barrel. The US dollar index closed at an all time low of
73.77 against the other major world currencies. If you've made no changes in the last year, and with inflation being over 10%; your net worth has eroded by at least 10%. The immediate future does not see any major signs of improvement either.
Saturday, March 15, 2008Gold rose again, finally topping the $1000 per ounce barrier closing on Friday at $1003.30 per ounce, of course a record. Silver also gain again this week closing at $20.72 per ounce. The price of oil hit another record closing at $110.15 per barrel. As pointed out many times in this blog, oil is very key to inflation and the price of many things we buy. The price of oil and food are the main components on why real inflation has been in double digits the last couple of years, with no letup in sight. Also, the value of the US dollar index has dropped to a new all-time low at 71.65, again for the 3rd week in a row. This index measures the strength of the dollar against the other world currencies including the Euro, the British pound, the Swiss franc, Japanese Yen, Australian dollar, and others.
Monday, March 17, 2008On Friday, the Wall Street investment bank Bear Stearns became the first major casualty of the Great Depression of this century. The Federal Reserve, the US central bank, is leading a desperate struggle to prop up one of Wall Street's largest and most historic investment banks, as the credit crisis threatened to spiral into a full-blown banking crisis. The Federal Reserve agreed to offer financing for a proposed buyout from JP Morgan Chase bank and accept $30 billion of Bear Stearns' illiquid assets as collateral. Fed chairman, Ben Bernanke, who pumped $200 billion of loans to cash-strapped institutions last week, said more would be available to help others in distress.
Meanwhile, one UK economist warned that the world is now close to a 1930s-like Great Depression, while New York traders said they had never experienced such fear. The Fed's emergency funding procedure was first used in the Depression and has rarely been used since.
Obviously, as I've been pointing out for months, there will be many problems with the economic storm that has been brewing. Bear Stearns is just the first of many banks that will have to close their doors. We will be examining in more detail the effects of these problems this week and the conditions that have led up to the problems. Ultimately though, this is all part of a planned event by the international bankers that run the World Bank and International Monetary Fund (IMF).
Tuesday, March 18, 2008
Today, the Federal Open Market Committee meeting voted and lowered the federal funds rates to banks by 75 basis points down to 2.25% from 3.00%. This means the Fed is continuing to try and keep the economy moving by making credit more readily available for banks and businesses alike. The banks will find it easier to lend to businesses with a lower rate and in turn can open new loans with the deposit and interest payments made by the businesses.
The good news in all of this is the Fed is not currently repeating the mistakes made in the first Great Depression that began in 1929. After the initial fall of the stock market in October, 1929, the Fed raised interest rates to 6% on November 1, 1929 making the liquidity problem at that time even worse. That constricted an already short money supply and caused the nation to sink deeply into the depression. That action then was by design to ultimately acquire more than two thirds of the farms of America and make the farmer tenants on their own lands.
I've received credible information that the international bankers will collapse the US economy in September 2008. This was linked to the closed door session of Congress last Thursday on March 14th, 2008, letting our policymakers in Washington know ahead of time. Whether this will hold true, only time will tell.
In this century's Great Depression, the aim will be different, but similar. Their aim this time will be grab as much residential and commercial real estate as possible. Once a majority of homeowners are renters again, their level of control will be even greater and they will have another piece of their plan in place.Thursday, March 27, 2008$200 billion is the approximate total amount of write-downs announced so far as a result of the current credit crisis.
$14.1 trillion is the size of the entire U.S. economy
And $53 trillion is (drum roll please) the approximate size of this country's bill for the Social Security and Medicare promises we've made. According to the latest Social Security and Medicare Trustees report (and I use that term loosely since it has the word "trust" in it) released earlier this week, the economic asteroid will first make impact in the year 2019 when the Medicaid trust fund becomes insolvent.
Realizing that Americans have become pretty much numb to these kinds of ridiculous sounding proposals, U.S. Treasury Secretary Henry Paulson tried to up the ante this week. "Without change," he said,
"Rising costs will drive government spending to unprecedented levels, consume nearly all projected federal revenues, and threaten America's future prosperity."
Translation: Every single tax dollar that is sent to Washington will be used to pay for just these two programs.
Monday, March 31, 2008Over the weekend, the Federal Reserve has sponsored a plan to revamp regulation of the financial system. Did anyone see this coming? ... Their new plan will broaden the control the Federal Reserve has significantly.
For example, the Treasury plan calls for the merger of the Securities and Exchange Commission and the Commodity Futures Trading Commission. The powers of the Securities and Exchange Commission would go into a super agency responsible for business conduct and consumer protection. What does this have to do with the credit crisis in the subprime mortgage industry? Over-leveraged mortgage backed securities is what caused the problem with Bear Stearns.
Here comes the Fed with a solution - give us more control so these events won't happen in the future. If you go back to previous posts in this blog on the History of Money, JP Morgan did this in the Panic of 1907. Franklin D. Roosevelt (at direction from the Federal Reserve) did this in 1933 with the Executive Order 6102 making it illegal to hoard gold by US citizens. The Great Depression was caused by the international bankers. Many farms were lost and handed over to the banks. These events all have one goal, to strip the money from the public and send it to the international bankers who do control the Federal Reserve. How much more can we put up with? When do we actually stand up and say "No more!"?
Take at look at this comment from a finance professor at Drexel University.
"These proposals address regulatory problems that may be generally necessary, but none of the suggestions provide ways of dealing with the crisis and economic roots of the crisis," said Joseph Mason.
Wednesday, April 2, 2008The spiral continues. Even though the Fed and JP Morgan came to the rescue of Bear Stearns, as I pointed out a couple of weeks ago, this is only the first casualty. Freddie Mac and Fannie Mae have received billions in credit from the Fed to continue operation while writing off some of these bad loans. What major bank or investment company will be next?
As banks and companies merge when the weaker companies are gobbled up, more control over the public is gained. Here's an insight. JP Morgan Chase, Goldman Sachs, Lehman Brothers, and Citibank will survive no matter what because they own shares in the Federal Reserve. Other banks and financial institutions may be suspect.
Saturday, April 19, 2008
All of the current moves are designed to increase federal control and minimize the rights of the citizens. With the future plans of the manipulators, the population must be docile and controlled. Remember when I described during the History of Money series the Hegelian dialect of thesis, antithesis, and synthesis. An event is created to cause a problem, resources are made available to combat or correct the conditions of the problem, and then a solution is created that they always wanted that would not have been possible if the problem didn't exist. This formula is used over and over again in history.
Well, the current plan that Tom Raum refers to is to have the Federal Reserve to have more and much broader power and eliminate the "smaller" agencies currently in charge of financial regulation like the SEC (Securities and Exchange Commission) and the FTC (Federal Trade Commission). Again, they are trying to consolidate the power base. Fewer players and more power make is easier to implement their plans. Beware of the changes coming later this year!
The price of oil will likely really shoot up the next month as the travel industry prepares for the upcoming vacation season in the United States. The price at the gas pump always spikes right before Memorial Day so that early vacationers of the summer season are hit with the increased prices. This makes for some huge profits for the oil companies.
Saturday, April 26, 2008So, now many of the pieces are in place for their plan. You have heard many of these topics discussed in this blog over the last several months - government, politics, business leaders, markets, judicial system, military, the media, entertainment, etc. As long as they have a few key people in every major area listed, they are able to steer the public and policy to favorable terms for their goals. However, because most people do not like being deceived, their plans must be made in secret. That is why you don't hear much about groups like the Council on Foreign Relations, The Trilateral Commission, and the Bilderberg group. Furthermore, they have quasi government agencies to carry out many of their directives such as the World Bank, the International Monetary Fund, the United Nations, the Federal Reserve, the IRS, etc.
Is total control such a far fetched idea now?
... the price of oil continued setting new record levels closing at $118.91 per barrel. The US dollar index rose slightly to 72.67 against the other major world currencies. It should be noted that the Euro, set a all time record against the dollar this week hitting $1.60 USD for one euro before retreating.
Saturday, May 3, 2008For months, I have passed a lot of information to my readers about many topics. Most of them are extremely important to my future, your future, the future of our country, and the future of the entire world. Have you recognized the importance? Have you acted on the information? Have you taken steps to protect yourself? Or, have you confined yourself to wait and see what happens? As always, the choice is yours.
As I have mentioned in previous posts in this blog regarding one of my mottoes
(the IKC principle) -
Information is not Knowledge without Action,
Knowledge creates Choices,
Choices allow us to Change our lives.
Saturday, May 10, 2008The increased price of oil not only drives up the price of gasoline, but also everything else. Food will cost more because of increased transportation costs. This also affects most other markets as well, so inflation as a whole goes up. In previous posts in this blog (November 20, 2007), it is important to understand the distinction of core inflation and real inflation. Core inflation, which is reported on news programs, measures the prices of selected consumer goods, but excludes the costs of food and energy. Thus, this figure means very little because everyone is truly affected by the price of food and gas. Therefore, they use this to core inflation number to soften and confuse the public on the real effects. Real inflation is well into double digits.
That is why inflation is really an invisible tax, affecting everyone. The Federal Reserve has so much more power than most people realize.
Thursday, May 15, 2008a war or preemptive tactical nuclear strike on Iran will not be about their nuclear program, but about the macroeconomic reasons behind the American hegemony being eroded and the Iranian Oil Bourse trading in oil transactions other than the USD.
When an event does happen, it will likely happen in the Strait of Hormuz, the narrowest point between Iran and Saudi Arabia is 34 miles. Roughly 40% of all oil traded globally pass through this strait on way to global oil ports. Currently, some 16-17 million barrels of oil are carried through the narrow channel on oil tankers every day according to the U.S. Energy Information Administration (EIA). Ninety percent of oil exported from Gulf producers is carried on oil tankers through the Strait. Over 75 percent of Japan's oil passes through the Strait.
Because of the strategic location of the Strait, Iran has installed sophisticated anti-ship missiles on the Island of Abu Musa, and therefore controls the critical Strait of Hormuz – where all of the Persian Gulf bound oil tankers must pass. Iran also has a very robust military capability.
Friday, May 16, 2008When a wayward and corrupt fiscal policy and fiat currency, coupled with runaway government spending, forces a nation to only be able to sustain the value of its currency with bullets, the citizenry of the country involved in wars primarily to sustain its currency have historically first became slaves to their government, and then to the nations that finally conquer them. ... towards the end of the Roman reign, the Roman Empire was doing exactly what America is doing today; attempting to sustain a failed fiat money system with bullets.
Understanding fiat money is not an easy task, and the Federal Reserve, World Bank, and International Monetary Fund have purposely made it that way. They do not want the American people to realize that the money in their wallet loses its value with each new dollar that they print. They do not want people to understand that our money does not become money until it is borrowed. When the Federal Reserve has money printed, when it is in uncut sheets of paper, it is not yet money. After it is cut, bundled, and placed into the Federal Reserve vaults, it still is not money. It only becomes money once it is borrowed.
Saturday, May 24, 2008The price of gold increased this week to close on Friday at $925 per ounce. Silver also increased to $18.22 per ounce, up more than a dollar per ounce from last week. The price of oil continued to set new weekly highs closing at $131.70 per barrel. The US dollar index also fell to close at 71.99. How long can the credibility of the dollar last?
Over the last few weeks I have made comments about several invisible taxes - one being inflation and the other being the increased costs of fuel (oil, gas, and all the derived products). These invisible taxes are devastating on the general public unless their income is going up substantially. This is why a economic collapse of our markets is very likely, the only question being the timing.
Monday, July 14, 2008Back on March 17th, 2008, I reported in this blog about the first casualty of the Great Depression of this century. That report was about the imminent collapse and subsequent bailout of Bear Stearns, one of America's longest tenured investment banks. At that time, I mentioned that this would only be the first of many bank failures. Today, we will look at the second casualty - IndyMac, a California based bank that closed its doors on Friday.
IndyMac is ground-zero of the sub-prime crisis and the poster-child of imprudent lending. Founded in 1985 by Countrywide Bank, whose own recent failure was masked by its acquisition by Bank of America, IndyMac pioneered the issuance of so-called Alt-A mortgages to borrowers who do not fully document their income or assets, which typically means borrowers with blemished credit histories or real estate speculators looking to 'flip' houses during the bubble years. Alt-A mortgages were considered to be less risky than the subprime loans which started the current financial crisis last year, so IndyMac's plight may cause everyone to re-think that credit quality fairy tale.
Tuesday, July 15, 2008The FDIC deposit fund only has $53 billion of assets, and around 10% or perhaps more of that is now going to be used to bail-out IndyMac. So how safe is the FDIC?
Saturday, July 19, 2008I will disagree slightly with James Turk as to the timing of the imminent collapse of the US dollar. I do not think it will happen this summer, but I believe it will happen in September or October for a lot of reasons. First, the Fed is unlikely to shake things up by raising rates during the summer. Many traders and power brokers on Wall Street take vacations during the summer usually causing the markets to remain fairly stagnant. Once fall returns, all bets are off. Third, the earlier closed door session of Congress in March was rumored to prepare the legislature for financial collapse in the fall. The powder keg is prepared, all that is needed is a spark. Time will tell.
Gold closed slightly lower on Friday from last week at $955.40 per ounce. Silver also closed lower this week at $18.14 per ounce.
The price of oil fell $16 per barrel the last four days closing at $128.50 per barrel. Despite these moves, the US dollar index still is languishing but rose slightly to close at 72.17.
Saturday, August 2, 2008The financial system will collapse before "zero-hour" actually occurs. I think we are seeing signs of it in the desperate measures being employed to nationalize companies which trade on market exchanges as private enterprises. There is simply no way to defend the SEC's decision to selectively enforce the prohibition of naked short selling for 17 ‘fragile' financial companies and to not enforce it for the over 5000 other companies which trade on US stock market exchanges. And plans to rescue Fannie Mae and Freddie Mac breathe of a sort of corporate nationalism. Over time this will deal a massive psychological blow to financial markets.
A couple of weeks ago, William Poole, formerly of the St, Louis Fed warned that Fannie (Mae) and Freddie (Mac) were insolvent. These aren't the warnings of bombastic flamethrowers. These are former respected and responsible government officials who courageously dare to speak the truth!
Saturday, August 9, 2008... the manipulators do not want a total breakdown of the system. If that happens, too many things are unpredictable such as a revolution. They slowly and methodically control the movements of the economies in their favor, so that they can reap the benefits and have more power and control.
With the bank failure of IndyMac, the insolvency pressures on Fannie Mae and Freddie Mac, and the SEC's decision to prohibit the naked short selling of 17 high profile financial institutions, all of these factors signify that they are losing control on the system. The financial 'wind shear' of inflation (rising prices) and deflation (shortage of liquidity due to the credit crunch) was threatening to tear the economy to pieces.
So, they come up with a new trick. No longer can they play games with the federal funds interest rate by the Federal Reserve (currently at 2%, the lowest since 2004), they began to play more with the price of oil to affect the economy and the global currencies. I ask you, what has transpired in the last three weeks that would cause oil to drop from $147 all the way to $115?
So between the drop in the price of oil and the weakening of the European currencies, the US dollar rose remarkably in strength reaching 75.90 yesterday, a gain of 2.5 index points, the highest since Feb. 21. This is steepest weekly rally by the US Dollar Index since January 2005. This action spurred the S&P 500 to its biggest weekly gain since April. The S&P added 2.9 percent to 1,296.32, the highest since June 25. The Dow Jones Industrial Average increased 3.6 percent to 11,734.32.
Every American is starting to breathe a little easier at the news and will likely resume their spending habits, exactly as the manipulators expected.Saturday, August 23, 2008Gold closed on Friday at $824.20 per ounce from $786.00 per ounce last week. Silver also closed higher at $13.41 per ounce from $12.70 per ounce last week. The price of oil closed slightly higher at $114.78 per barrel from last week before retreating after nearly hitting $122 per barrel on Thursday. The US dollar index closed slightly lower at 76.74. Oil has driven these other prices dramatically over the last several weeks.
Well, how do you think I did at reading the signs and predicting the future?Obviously, I was wrong about the demise of the dollar and the recent drop in oil prices. But in hindsight, that was part of the manipulators plans to give the Fed more power to print more money and have the much bigger banks swallow up the smaller ones at bargain basement prices. The current huge financial bailout is going to be the burden of the taxpayer, and they get more control of the system.
How have you fared over the last year? Are you getting worried? Are you taking action?
As always, the choice is yours.Set up road signs; put up guideposts. Take note of the highway, the road that you take. Jeremiah 31:21If you have comments or questions, please feel free to contact me at the address below.
Email: DeltaInspire@panama-vo.com
