The Way I See It

by Chuck Madere

As I sit here at my computer, I think about my 60 plus years under the sun. I humor about the days of my youth and the love of my family that was felt by all my sisters and brother. I had a complete family until the day death paid us a visit and took my father at the age of thirty-four.

My mother never remarried but raised us kids five under the age of eight till she past away at the age of fifty-two. She and dad were reunited again only to see two of their daughters arrive there with them within three years of mom’s death. Two plus five equals seven minus four equals three. And three is what is left of our family today. My brother and his twin sister and me.

It sure was not easy growing up without a father back then. Mom had no money to speak of except what she got from Social Security and dad’s pension. We were considered poor but to us we were rich beyond measure. We were a family growing up in the sixties. I decided to go into the army at seventeen but was rejected because of blood found in my urine. 1Y was my classification which meant that they could call me back anytime they wanted to and re-test me, and that they did often for the war was on big time then.

I enlisted into the Army again and was rejected again. I got drafted twice and rejected those times as well. I guessed God didn’t want me to go to war but had other things planned for me. I wrote a letter to the draft board asking for a 4F classification which they then gave me. I was beginning to be a regular there and I saw hundreds pass through those lines on their way to battle.

As time past I found my place as an Industrial Maintenance Engineer. I did this type of work untilled I retired at fifty-five. I have three boys in their thirties now and they are building their lives with their wives. All during those years I could see that we as a people supposedly united for a common good were pitted against ourselves by a higher power. A power that cares nothing about us and cares only for power and money to control.

What happened to us?

Our nation is just over two hundred years old and we the people can’t get anything together for the good of all. We tell a good tale but when it come to deliver the goods we stumble and fall. The way I see it is if we don’t start doing what we came here for in the first place this great nation will come to an end. Do your history checking if you don’t know what I’m talking about.

How many of you wake to work to sleep to wake and do it all again waiting for a day off. The answer is we all do that and we have been led to believe this is the way of life. This is not living. The way I see it is we are paid for our work in fiat currency that the Federal Reserve System of banks give us and we gladly take them in lieu of real money not even knowing that there is a difference. We take what they give us like sheep being led to the slaughter.

The Federal Reserve is a privately own company with no ties to the government. They have as much Federal in them as Federal Express and we don’t know that. The banks have been raping us for just about one hundred years now and we go along with it.

Ever wonder where they get the money they lend out? Me too. I know that the moment you sign to repay them with the loans we take out, magically the money is created out of thin air. The only guarantee is your signature to repay. We all need to stay away from these banks and only deal in real assets like gold and silver. HUH you say. Yes, gold and silver is real money. The money that you work for everyday. Look at your paycheck before you take it to the bank. What does it say you are to be paid in? FRN or dollars? Dollars is what it says, but the bank give you their IOU because they don’t have any real dollars to give you. If they did they would not be in business very long. The way I see it.

Chuck Madere

Go Here and Learn about Real Money http://goldsilver.com/970

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When the Dollar Rallies, the Market Will Crash

by Mike Whitney
by Mike Whitney
Recently by Mike Whitney: Lehman Died So TARP and AIG Might Live

Interest rates. The Fed does not need slinky women in plunging necklines to peddle money. All it needs is low interest rates. When rates are pushed lower than the rate of inflation, the Fed provides a subsidy for borrowing. This is not as hard to grasp as it sounds. If I offered to give you $1.00 for very 90 cents you gave me in return, you would buy as many dollars from me as you could. The Fed operates the same way. It generates market activity by creating incentives for borrowing. Borrowing leads to speculation, and speculation leads to steadily rising asset prices. This is how the game is played. The Fed is not an unbiased observer of free market activity. The Fed drives the market. It fuels speculation and controls behavior by fixing interest rates.

When Lehman Bros flopped last year, markets went into freefall. A sharp correction turned into a full-blown panic. The bubble burst and trillions of dollars in credit vanished in a flash. Trading in exotic debt-instruments stopped overnight. A global sell-off ensued. Markets crashed. For a while, it looked like the whole system might collapse.

The Fed’s emergency intervention pulled the system back from the brink, but the economy is still wracked with deflation. Billions in toxic waste now clog the Fed’s balance sheet. The dollar has fallen like a stone.

When the financial system blows up and credit is sucked down a capital-hole, the economy goes into a downward spiral. Businesses slash inventory and lay off workers, workers have to cut back on spending and credit. That creates less demand for products, which leads to more lay-offs. This is the vicious circle policymakers try to avoid. That’s why Fed chair Ben Bernanke wheeled out the heavy artillery and launched the most aggressive central bank intervention in history.

The Fed dropped rates to zero, but its Quantitative Easing (QE) program (which monetizes the debt) actually pushes rates even lower to roughly negative 2 percent.

Bernanke has underwritten every sector of the financial system with government guarantees. He has provided full-value loans for dodgy collateral which is worth only a fraction of its original value. The market can no longer operate without the Fed. The Fed IS the market, which is why it is foolish to talk about a "recovery". The idea of recovery implies a free-standing system based on supply and demand. But, for now, the government provides the demand, which is why there is no market and no recovery. Analysts at Goldman Sachs sum it up like this:

"How much of the rebound in real GDP was due to the fiscal stimulus, and where do we stand in terms of the effects of stimulus thus far? Although precise answers are impossible at this juncture, several aspects of the report are consistent with our estimates that the fiscal package enacted in mid-February as the American Recovery and Reinvestment Act (ARRA) would have accounted for virtually all of the growth reported for the third quarter."

Positive growth is an illusion created by government spending. The economy is still flat on its back. Consumer spending and credit are in sharp decline. Unemployment is steadily rising (although at a slower pace) and wages are flatlining with a chance of falling for the first time in 30 years. Deflationary pressures are building. The talk of a "jobless recovery" is intentionally misleading. Jobs ARE recovery; therefore a jobless recovery merely points to asset-inflation brought on by erratic monetary policy. Surging stocks shouldn’t be confused with a genuine recovery.

The Fed faces stiff headwinds ahead. Low interest rates can have unintended consequences. The "cheapness" of the greenback has made the dollar the funding currency for the carry trade. Investors are borrowing low-cost dollars and using them to purchase higher-interest assets elsewhere. The process, which is rapidly escalating, is fraught with peril as economist Nouriel Roubini points out in an article in the Financial Times:

"Since March there has been a massive rally in all sorts of risky assets… and an even bigger rally in emerging market asset classes (their stocks, bonds and currencies). At the same time, the dollar has weakened sharply, while government bond yields have gently increased but stayed low and stable…

But while the US and global economy have begun a modest recovery, asset prices have gone through the roof since March in a major and synchronized rally… Risky asset prices have risen too much, too soon and too fast compared with macroeconomic fundamentals.

So what is behind this massive rally? Certainly it has been helped by a wave of liquidity from near-zero interest rates and quantitative easing. But a more important factor fueling this asset bubble is the weakness of the US dollar, driven by the mother of all carry trades. The US dollar has become the major funding currency of carry trades as the Fed has kept interest rates on hold and is expected to do so for a long time. Investors who are shorting the US dollar to buy on a highly leveraged basis higher-yielding assets and other global assets are not just borrowing at zero interest rates in dollar terms; they are borrowing at very negative interest rates…

Every investor who plays this risky game looks like a genius – even if they are just riding a huge bubble financed by a large negative cost of borrowing…

…This policy feeds the global asset bubble it is also feeding a new US asset bubble…
The reckless US policy that is feeding these carry trades is forcing other countries to follow its easy monetary policy… This is keeping short-term rates lower than is desirable… So the perfectly correlated bubble across all global asset classes gets bigger by the day.

But one day this bubble will burst, leading to the biggest co-ordinated asset bust ever: if factors lead the dollar to reverse and suddenly appreciate… the leveraged carry trade will have to be suddenly closed as investors cover their dollar shorts. A stampede will occur as closing long-leveraged risky asset positions across all asset classes funded by dollar shorts triggers a co-ordinated collapse of all those risky assets – equities, commodities, emerging market asset classes and credit instruments." ("The Mother of all Carry Trades Faces an Inevitable Bust," Nouriel Roubini, Financial Times.)

Everyone who watches the market has noticed the inverse correlation of stocks to the dollar. When the dollar fades, stocks soar. And when the dollar strengthens, stocks plunge. Eventually, the dollar will reverse-course and stage a comeback, probably when Bernanke stops his printing operations. That will trigger the next severe correction which will burst bubbles across all asset classes.

Bernanke’s success in reflating sagging asset prices has depended entirely on interest rate manipulation and liquidity injections. There’s been no effort to patch household balance sheets, increase production, or strengthen overall demand. It’s a clever trick by a master illusionist, but it has its costs. When the dollar rallies, markets will crash. And Bernanke will be responsible.

November 7, 2009

Mike Whitney [send him mail] lives in Washington state.

Copyright © 2009 Mike Whitney

brought to you by: Chuck Madere

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Kiss Your Freedoms Goodbye If Health Care Passes

by Andrew Napolitano 

- FOXNews.com

- November 06, 2009

• Congress recognizes no limits on its power
• It doesn’t care about the Constitution
• It doesn’t care about your inalienable rights
• If this health care bill becomes law
• America, life as you have known it
• Freedom as you have exercised it
• Privacy as you have enjoyed it will cease to be

Tomorrow, the House of Representatives will vote on a 2,000 page bill to give the federal government the power to micromanage the health care of every single American

 

The bill will no doubt pass. It will raise your taxes, steal your freedom, invade your privacy, and ration your health care.

 

Even the Republicans have introduced their version of Obamacare Lite. It, too, if passed, will compel employers to provide coverage, bribe the states to change their court rules, and tell insurance companies whom to insure.

We do not have two political parties in this country, America. We have one party; called the Big Government Party. The Republican wing likes deficits, war, and assaults on civil liberties. The Democratic wing likes wealth transfer, taxes, and assaults on commercial liberties. Both parties like power; and neither is interested in your freedoms. Think about it. Government is the negation of freedom. Freedom is your power and ability to follow your own free will and your own conscience. The government wants you to follow the will of some faceless bureaucrat.

When I recently asked Congressman James Clyburn, the third ranking Democrat in the House, to tell me "Where in the Constitution the federal government is authorized to regulate everyone’s healthcare–, he replied that most of what Congress does is not authorized by the Constitution, but they do it anyway. There you have it. Congress recognizes no limits on its power. It doesn’t care about the Constitution, it doesn’t care about your inalienable rights, it doesn’t care about the liberties protected by the Bill of Rights, it doesn’t even read the laws it writes.

America, this is not an academic issue. If this health care bill becomes law, life as you have known it, freedom as you have exercised it, privacy as you have enjoyed it, will cease to be.

When Congress takes away our freedoms, they will be gone forever. What will you do to prevent this from happening?

Judge Andrew Napolitano is Fox News Channel’s senior judicial analyst.

I am reposting this in hopes to awake those of you that take our American way of life serious.

Chuck Madere

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Gold Market Breaking News

Gold Market Breaking News 11/4/09

India, the world’s biggest gold consumer, bought 200 metric tons from the International Monetary Fund for $6.7 billion as central banks show increased interest in diversifying their holdings to protect against a slumping dollar.

The transaction, equivalent to 8 percent of world annual mine production, was the IMF’s first such sale in nine years and propels India to the ninth-biggest government owner globally, according to figures from London-based research company GFMS Ltd. The country previously held 358 tons, the data show. The news was a "surprise because everybody was talking about China being the buyer," said James Moore, an analyst at TheBullionDesk.com.
Source: Bloomberg.com
India just bought 7,054,792 ounces of gold to protect themselves from a falling dollar.  As a US citizen with more risk, how much should you consider purchasing?

Got Gold and Silver? You will need some soon. Visit

http://goldsilver.com/970  Today

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