50 Factors Launching Gold
http://goldsilver.com/news/excellent-read-50-factors-launching-gold-jim-willie-cb/
Jim Willie
APRIL 20, 2011
1) USFed is stuck at 0% for over two years and printing $1.7 trillion
in Quantitative Easing, otherwise called monetary hyper inflation. They
are not finished destroying both money and capital.
2) USFed tripled its balance sheet, with over half of it bonds of
exaggerated value, while it gobbled up toxic mortgage bonds as buyer of
last resort. The mortgage bonds have turned worthless. The USFed waits
for a housing revival to bail itself out, but it will not arrive.
3) Debt monetization has gone haywire, as over 70% of USTBond
sales from the USFed printing press. The QE was urgently needed, since
legitimate buyers vanished. Even the primary dealers have been reimbursed
in open market operations within a few weeks.
4) PIMCO has shed its entire USTreasury Bond holdings, seeing no
value. They joined many foreign creditors in an unannounced buyer boycott
in disgusted reaction to QE which is essentially a compulsory unilateral
debt writedown.
5) Growing USGovt deficits have run over $1.5 trillion annually, with
absent cuts, obscene entitlements, endless war. The prevailing short-term
0% interest rates are out of synch with exploding debt supply and rising
price inflation.
6) Unfunded USGovt liabilities total nearly $100 trillion for medicare,
social security, pensions, and more. The obligations are never included
in the official debt. It represents insult to injury within insolvency.
7) Standard & Poors warned that USGovt could lose AAA rating in lousy
credit outlook, one chance in three within the next two years. Ironically,
the announcement came on the day when the USGovt exceeded its debt
limit. The network news missed it.
8) State & Municipal debt have collapsed, as 41 states have huge
shortfalls, and four large states are broken. They might receive a
federal bailout. It could be called QE3, maybe QE4.
9) Coordinated USTBond purchases from Japanese sales have relieved the
USFed, as other major central banks act as global monetarist agents. The
sales by Japan are vast and growing. Witness the last phase in unwind of
Yen Carry Trade, where 0% borrowed Japanese money funded the USTreasury
Bonds and US Stocks.
10)Quantitative Easing, a catch word for extreme monetary inflation and
debt monetization, has become engrained into global central bank policy,
soon hidden. It is so controversial and deadly to the global financial
structures that it will go hidden, and attempt to avoid the furious anger
in feedback by global leaders. This is the most important and powerful
of all 50 factors in my view.
11)The FedFunds Rate is stuck near 0%, yet the actual CPI is near 10%,
for a real rate of interest of minus 9%. Historically a negative real
rate of interest has been the primary fuel for a Gold bull. This time
the fuel has been applied for a longer period of time, and a bigger
negative real rate than ever.
12)The USGovt claims to have 8000 tons of Gold in reserve, but it is
all in Deep Storage, as in unmined ore bodies. The collateral for the
USDollar and USTreasury debt is vacant. It is in raw form like in the
Rocky Mountain range or Sierra Nevada range.
13)Fast rising food prices, fast rising gasoline prices, and fast
rising metals, coffee, sugar, and cotton serve as testament to broad
price inflation. So far it has shown up on the cost structure. Either
the business sector will vanish from a cost squeeze or pass on higher
costs as end product and service price increases.
14)The entire world seeks to protect wealth from the ravages of inflation
& the American sponsored QE by buying Gold & Silver. The rest of the world
can spot price inflation more effectively than the US population. The
United States is subjected to the world's broadest and most pervasive
propaganda in the industrialized world.
15)The European sovereign debt breakdown with high bond yields in
PIIGS nations points out the broken debt foundation to the monetary
system. The solutions like with Greece in May 2010 were a sham, nothing
but a bandaid and cup of elixir. Spain is next to experience major
shocks that destabilize all of Europe again, this time much bigger than
Greece. The Portuguese Govt debt rises toward 10% on the 10-year yield,
while the Greek Govt debt has risen to reach 20% on the 2-year yield.
16)Germany is pushing for Southern Europe bank climax in their Euro
Central Bank rate hike. Europe will be pushed to crisis this year,
orchestrated by the impatient and angry Germans. They have no more
appetitive for $300 to $400 billion in annual welfare to the broken
nations in Southern Europe.
17)Isolation of the USFed and Bank of England and Bank of Japan has
come. The small rate hike by the European Central Bank separated them
finally. The Anglos with their Japanese lackeys are the only central
banks not raising rates. With isolation comes all the earmarks on the
path to the Third World.
18)The shortage of gold is acute, as 51 million gold bars have been sold
forward versus the 11 million held by the COMEX in inventory. Be sure
that hundreds of millions of nonexistent fractionalized gold ounces are
polluting the system. Word is getting out that the COMEX is empty of
precious metals.
19)Such extreme Silver shortage has befallen the COMEX that the corrupted
metals exchange routinely offers cash settlement in silver with a 25%
bonus if a non-disclosure agreement is signed. The practice cannot be
kept under wraps, as some hedge funds push for fat returns in under two
months holding positions with delivery demanded.
20)China has begun grand initiatives to replace its precious metal
stockpiles. They are pursuing the Yuan currency to become a global reserve
currency. As they build collateral for the Yuan, they are also elevating
Silver as reserves asset.
21)A global shortage of Gold & Silver has been realized in national mint
production. From the United States to Canada to Australia to Germany,
shortages exist. Many interruptions will continue amidst the shortages,
which feed the publicity.
22)The Teddy Roosevelt stockpile of 6 million Silver ounces was depleted
in 2003. He saw the strategic importance of Silver for industrial and
military applications. The USEconomy and USMilitary will turn into
importers on the global market.
23)The betrayal of China by USGovt in Gold & Silver leases is a story
coming out slowly. The deal was cut in 1999, associated with Most Favored
Nation granted to China. But the Wall Street firms broke the deal,
betrayed the Chinese, and angered them into highly motivated action. No
longer are the Chinese big steady USTBond buyers, part of the deal also.
24)Every single US financial market has been undermined and corrupted from
grotesque intervention, constant props, and fraudulent activity. The
degradation has occurred under the watchful eyes of compromised
regulators. Fraud like the Flash Crash and NYSE front running by Goldman
Sachs is protected by the FBI henchmen.
25)The USEconomy operates on a global credit card, enabling it to live
beyond its means. The USGovt exploits the compulsory foreign extension
of credit in USTBonds, by virtue of the USDollar acting as global
reserve currency. Foreign nations are compelled to participate but that
is changing.
26)The USMilitary conducts endless war adventures for syndicate
profits. They use the USTreasury Bond as a credit card. The wars cost
of $1 billion per day is considered so sacred, that it is off the table
in USGovt budget call negotiations, debates, and agreements.
27)Narcotics funds have proliferated under the USMilitary aegis. The
vertically integrated narcotics industry is the primary plank of nation
building in Afghanistan. The funds keep the big US banks alive from vast
money laundering.
28)No big US bank liquidations have occurred, despite their deep
insolvency. Any restructure toward recovery would have the liquidations
are the first step. The USEconomy is stuck in a deteriorating swamp
since the Too Big To Fail mantra prevents the urgent but missing step.
29)The unprosecuted multi-$trillion bond fraud over the last decade has
harmed the US image, prestige, and leadership. The main perpetrators are
the Wall Street bankers and their lieutenants appointed at Fannie Mae
and elsewhere. They bankers most culpable remain in charge at the USDept
Treasury and other key supporting posts like the FDIC, SEC, and CFTC.
30)The ugly daughters Fannie Mae and AIG are forever entombed in
the USGovt. They operate as black hole expenses whose fraud must be
contained. The costs involved are in the $trillions, all hidden from view
like the fraud. Fannie Mae remains the main clearinghouse for several
$trillion fraud programs still in operation.
31)The US banking system cannot serve as an effective credit engine
dispenser, an important function within any modern economy. It is deeply
insolvent, and growing more insolvent as the property market sinks lower
in valuation. The banks lack reserves, and hide their condition by means
of the FASB permission to use fraudulent accounting.
32)The big US banks are beneficiary of continuous secret slush fund
support from the USGovt and USFed. Their sources and replenishments
have been gradually revealed. The TARP Fund event will go down in modern
history as the greatest theft the world has ever seen, easily eclipsing
the biggest mortgage bond fraud in history.
33)The insolvent big US banks continue to sit at the USGovt teat. The
vast umbilical cord of banker welfare has not gone away. Goldman Sachs
still is in control of the funding machinery.
34)The shadow banking system based upon credit derivatives keeps
interest rates near 0%. The usury cost of money is artificially low
near nothing. As money costs nothing, capital is actively and rapidly
destroyed.
35)A vast crime syndicate has taken control of the USGovt. A vast crime
syndicate has taken control of the USMilitary. A vast crime syndicate
has taken control of the USCongress. A vast crime syndicate has taken
control of the US press networks.
36)A chronic decline of the US housing sector keeps the USEconomy in
a grand decline with constant deterioration. With one million bank
owned homes in inventory, a huge unsold overhang of supply prevents any
recovery of housing prices. Home equity continues to drain, and bank
balance sheets continue to erode.
37)Over 11 million US homes stand in negative equity. The sum equals to
23.1% of households. They will not participate much in the USEconomy,
except when given handouts. They have become downtrodden.
38)The USEconomy will not benefit from a export surge. The US industrial
base has no critical mass after 30 years of dispatch to the Pacific Rim
& China. The industry must contend with rising costs in offset to the
falling USDollar, which is cited as providing the mythical benefit. Then
can export in droves if they do so at a loss.
