James Rickards-Financial Collapse and Massive Shortages in Gold Coming

Financial Collapse and Massive Shortages in Gold Coming 

By Greg Hunter’s USAWatchdog.com

Financial expert and best-selling author James Rickards’ latest book predicts “the coming collapse of the international monetary system.”  One of the sign posts is countries like Russia declaring it will shed the U.S. Dollar as reserve currency in international trade.  Rickards explains, “Putin said he envisions a Eurasian economic zone involving Eastern Europe, central Asia and Russia.  The Russian Ruble is nowhere near ready to be a global reserve currency, but it could be a regional reserve currency.”

Rickards’ latest best-selling book, “The Death of Money,” was released in April.  Even Rickards is surprised at how fast the economic situation is unfolding.  Richards says, “If you ask me what has happened since you finished writing the book that comes as a surprise, I would say a lot of the things I talk about in my book are happening faster than I would have expected.  Things that I thought would happen in the 2015 or 2016 time frame seems to be happening now in some ways.  If anything, the tempo of events is faster than expected.  Therefore, some of these catastrophic outcomes may come sooner than I wrote about.”

Rickards goes on to say, “Right now, we are on the precipice now.  When you are on the precipice, it doesn’t mean you fall off immediately, but you are going to fall off because you can see the forces in play.  What I tell clients and investors is it’s not as if we are going to make some mistakes and some bad things are going to happen.  The mistakes have already been made.  The instability is already in the system.  We’re just waiting for that catalyst that I call the snowflake that starts the avalanche.   You don’t worry about the snowflakes; you worry about the snow and that it’s unstable and it’s just waiting to collapse.  That’s what the system is right now; we are just waiting for a catalyst.  People ask me all the time, what could it be?  Technically, my answer is it doesn’t matter because it will be something.  It could be a failure to deliver physical gold.  It could be an MF Global financial failure.  It could be a natural disaster.  It could be a lot of things.  The thing investors need to understand is the catalyst doesn’t matter.  It’s coming because the instability is already there.”

On gold manipulation and when it will end, Rickards says, “It will end when the physical shortage gets to the point that someone fails to deliver; which, at that point, there will be a buying panic.  There could be a buying panic or what some people call a demand shock.  One of the things I said about gold manipulation is if I was the manipulator, I would be embarrassed at this point.  The manipulation is obvious.  The evidence is coming in from all directions. . . . The manipulation is clear.  When will it end?  It will end when there is a physical shortage that pops up somewhere, or it will end with a short squeeze.”
James Rickards, author of the best-selling new book called “The Death of Money.”

rest of story - USAWatchdog >>>

The great deceiver: The Federal Reserve

Dr. Paul Craig Roberts

Is the Fed “tapering?” Did the Fed really cut its bond purchases during the three month period November 2013 through January 2014? Apparently not if foreign holders of Treasuries are unloading them.

From November 2013 through January 2014 Belgium with a GDP of $480 billion purchased $141.2 billion of US Treasury bonds. Somehow Belgium came up with enough money to allocate during a 3-month period 29 percent of its annual GDP to the purchase of US Treasury bonds.

Certainly Belgium did not have a budget surplus of $141.2 billion. Was Belgium running a trade surplus during a 3-month period equal to 29 percent of Belgium GDP?

No, Belgium’s trade and current accounts are in deficit.

Did Belgium’s central bank print $141.2 billion worth of euros in order to make the purchase?

No, Belgium is a member of the euro system, and its central bank cannot increase the money supply.

So where did the $141.2 billion come from?

There is only one source. The money came from the US Federal Reserve, and the purchase was laundered through Belgium in order to hide the fact that actual Federal Reserve bond purchases during November 2013 through January 2014 were $112 billion per month.

In other words, during those 3 months there was a sharp rise in bond purchases by the Fed. The Fed’s actual bond purchases for those three months are $27 billion per month above the original $85 billion monthly purchase and $47 billion above the official $65 billion monthly purchase at that time. (In March 2014, official QE was tapered to $55 billion per month and to $45 billion for May.)

Why did the Federal Reserve have to purchase so many bonds above the announced amounts and why did the Fed have to launder and hide the purchase?

Some country or countries, unknown at this time, for reasons we do not know dumped $104 billion in Treasuries in one week.

Another curious aspect of the sale and purchase laundered through Belgium is that the sale was not executed and cleared via the Fed’s own National Book-Entry System (NBES), which was designed to facilitate the sale and ownership transfer of securities for Fed custodial customers. Instead, the foreign owner(s) of the Treasuries removed them from the Federal Reserve’s custodial holdings and sold them through the Euroclear securities clearing system, which is based in Brussels, Belgium.

We do not know why or who. We know that there was a withdrawal, a sale, a drop in the Federal Reserve’s “Securities held in Custody for Foreign Official and International Accounts,” an inexplicable rise in Belgium’s holdings, and then the bonds reappear in the Federal Reserve’s custodial accounts.

What are the reasons for this deception by the Federal Reserve?

The Fed realized that its policy of Quantitative Easing initiated in order to support the balance sheets of “banks too big to fail” and to lower the Treasury’s borrowing cost was putting pressure on the US dollar’s value. Tapering was a way of reassuring holders of dollars and dollar-denominated financial instruments that the Fed was going to reduce and eventually end the printing of new dollars with which to support financial markets. The image of foreign governments bailing out of Treasuries could unsettle the markets that the Fed was attempting to sooth by tapering.

A hundred billion dollar sale of US Treasuries is a big sale. If the seller was a big holder of Treasuries, the sale could signal the bond market that a big holder might be selling Treasuries in large chunks. The Fed would want to keep the fact and identity of such a seller secret in order to avoid a stampede out of Treasuries.

More…

Non-Farm Employment Nonsense: Down The Rabbit Hole

The US economy is a house of cards. Every aspect of it is fraudulent, and the illusion of recovery is created with fraudulent statistics.   – Dr. Paul Craig Roberts

While mainstream America will be greeted with news about the huge number of new jobs “created” in April, the truth is that the number of people employed in this country declined in April – by a significant amount.

I’m not going to go through the brain damage of dissecting the numbers other than report the fact that the Labor Force declined by 806,000. Most of that number is likely people who fell off the cliff of long-term jobless benefits. The labor force participation rate is now below 63%. The last time it was this low was March 1978.  This graph shows the “Civilian Labor Force Participation Rate,” which is the number of people employed plus the number of people considered “unemployed” as a percentage of the size of “working age” population.

In addition to nearly  one million people “disappearing” from the labor force, the Government’s nefariously fraudulent “birth/death” model plugged 234,000 jobs into its statistical model.

Given the natural monthly growth of the population in this country, and given that over a million workers either disappeared down the rabbit hole or were fabricated by the Government statisticians,  it is likely that April in actuality experienced a big decline in jobs.  But the Government would never admit to that.

At least we can see from the reaction to the number in the markets that the stock market and the gold/silver market do not believe the report. More >>>

Payrolls in U.S. Rise by Most Since 2012, Unemployment at 6.3%

Here is your first example of messaging the statistics,  the "Participation Rate" which means nearly 900,000 people dropped out of the work force, that will negate any gain. the second example is the GDP numbers below in next story excerpt.

By Michelle Jamrisko May 2, 2014 5:30 AM MT

Employers boosted payrolls in April by the most in two years and the jobless rate plunged to 6.3 percent as companies grew confident the U.S. economy is emerging from a first-quarter slowdown.

The 288,000 gain in employment was the biggest since January 2012 and followed a revised 203,000 increase the prior month that was stronger than initially estimated, Labor Department figures showed today in Washington. The median forecast in a Bloomberg survey of economists called for a 218,000 advance. Unemployment dropped from 6.7 percent to the lowest level since September 2008 as fewer people entered the labor force. Wages and hours worked were stagnant.

Households spent more freely as the first quarter drew to a close and manufacturing accelerated, helping explain why companies such as Ford Motor Co. (F) are taking on more workers. The figures corroborate theFederal Reserve’s view that the expansion is perking up after stagnating last quarter.

“The job market is starting to click on all cylinders — the engine is not running very fast, but all cylinders are moving,” Robert Stein, deputy chief economist at First Trust Portfolios LP in Wheaton, Illinois, said before the report. His firm is the second-best forecaster of payroll growth for the past two years, according to data compiled by Bloomberg. For the Fed, it “fits right within their wheelhouse, and wouldn’t alter in any way what they’re likely to do.”

Forecasts for April payrolls ranged from increases of 155,000 to 292,000, according to the Bloomberg survey of 94 economists. Last year, the U.S. added more than 194,000 jobs each month, compared with about 186,000 in 2012. Economists surveyed by Bloomberg on April 4-9 project payroll gains to match 2013.

More…

U.S. Economy Starts Year With a Whimper

 I would imagine, the economy might have contracted in the 1st quarter but the government would not release a negative number which could easily be massaged up without any flack from the major media.

GDP Growth Stalls as Frigid Weather, Weak Exports Curtail Activity

Wall Street Journal

U.S. growth nearly stalled in the first three months of the year, fresh evidence that the economic expansion that began almost five years ago remains the weakest in modern history.

Gross domestic product, the broadest measure of goods and services produced across the economy, grew at a seasonally adjusted annual rate of 0.1% in the first quarter, the Commerce Department said Wednesday. It marked the second-worst quarterly performance since the recession ended in mid-2009.

The weak GDP reading came as Federal Reserve officials voted to continue withdrawing their support for the economy based on the expectation—shared by many private economists—that growth would rebound, as it already started doing as the weather improved. “Economic activity has picked up recently, after having slowed sharply during the winter in part because of adverse weather conditions,” the central bank said in its policy statement Wednesday.

Harsh weather likely slowed first-quarter business investment and discretionary consumer spending. It could have even blocked exports—which notched their sharpest decline since the recovery began—from reaching ports.  More >>>