What’s Really Behind Utah’s Mock Earthquake Drill

Hot on the heals of House Bill 157, which legalizes the use of silver and gold bullion as currency, the state of Utah recently completed a joint mock emergency exercise between the state’s 400 national guard personnel and 48 guardsmen from the neighboring state of Wyoming.

The mock drill is a first of its kind since Utah Governor Gary Herbert declared the first week of April as ‘Earthquake Awareness Week’ for the state’s 2.8 million residents in 2010. Sign-up for my 100% FREE Alerts

“Earthquake expert, Bob Kerry, says Utah has a one-in-four chance for a 7.0 quake in the next 50 years,” Utah’s ABC4 News stated as the lead into the reporting of Utah’s first mock emergency drill.

However, an earthquake of that magnitude hasn’t hit Utah since the 17th century, according to state records.  In fact, since 1811, the only earthquakes registered in the U.S. greater than Richter Scale 7.0 occurred multiple times in Alaska, California, and a couple of times in Missouri.  The conclusion: earthquakes in Utah, of any significance, are very rare.

In addition, the auspicious timing of Governor Herbert’s ‘Earthquake Awareness Week’ annual events raises an additional red flag that points to well-intentioned deception.  Following the fall of Lehman Brother and plunge in global stock markets, discussions of imminent financial Armageddon became widespread in the media and public discourse, not just talk among a fringe few.  Well-known financial experts suggested the risk of a U.S. dollar collapse had increased markedly, including the implications of civil unrest, possibly leading to civil war.

In an Oct. 13, 2010, post on zerohedge.com, the site’s administrator Tyler Durden (Internet name) paraphrased Gluskin Sheff’s economist David Rosenberg’s comments regarding the Fed’s ZIRP policy, stating that the Fed’s plan is very  dangerous and “positions U.S. society one step closer to civil war if not worse.”

Nearly a week later, Time magazine on Oct. 19, 2010, titled, Will the Federal Reserve Cause a Civil War?

Jan. 23, 2011, Newsweek interviewed billionaire currency speculator George Soros about the global financial crisis.  He, too, fears a revolutionary outcome to a failed U.S. dollar—an outcome that historically could lead to far worse violence, loss of life and destruction of property compared with the aftermath of a natural disaster.

An excerpt from the Newsweek article about George Soros assessment of the financial crisis:

“I am not here to cheer you up. The situation is about as serious and difficult as I’ve experienced in my career,” Soros tells Newsweek. “We are facing an extremely difficult time, comparable in many ways to the 1930s, the Great Depression. We are facing now a general retrenchment in the developed world, which threatens to put us in a decade of more stagnation, or worse. The best-case scenario is a deflationary environment. The worst-case scenario is a collapse of the financial system.”

With financial collapse comes looting, violence and the potential for an overthrow of the government.

Interestingly, Utah, a state known for its disproportionate number of religious followers of the Church of the Latter Day Saints (LDS), or Mormons, has a history of promoting self-sufficiency and preparedness as well as fostering traditional fiduciary values.

In the face of a growing concern for a precipitous fall of the U.S. dollar’s value, the state’s LDS could be behind the drive for state-sanctioned preparedness to deal with a sudden spike in crime and the resulting chaos that will most likely ensure from a lack of law enforcement personnel to deal with a currency collapse.

In 1836, Joseph Smith, founder of the LDS movement, formed the Kirtland Safety Society (KSS), a quasi-bank to service the financial needs of the Mormon community in Kirtland, Ohio.  However, after being in operation for less than two years, the bank failed as part of the Panic of 1937 and alleged mishandling of bank funds by Smith.

Though the KSS ‘bank’ failed, the Mormon tradition of individual responsibility, self-reliance and distrust of public institutions remains strong today and may account for Utah’s leadership towards the reclamation of states rights under the 10th Amendment to the U.S. Constitution, as well as the Constitutionally inspired reintroduction of gold and silver as a means of protecting from the collapse of yet another fiat currency.  And the ‘Earthquake Awareness Week’ annual drills instituted by the Governor Herbert may merely serve as a euphemistically phrased reminder of an event approaching much worse than one of Mother Nature’s periodic unpleasant catastrophes. Sign-up for my 100% FREE Alerts

Operation ‘Easter Egg’: 200 Arab Billionaires Conspire to “Kill” the Dollar

Secret talks between 200 Arab billionaires in Abu Dhabi, UAE took place during Easter weekend in April 2010 to discuss the death of the petrodollar and the realignment of military protection of Middle East oil fields, according to a source close to Jim Willie of the Hat Trick Letter.

In an exclusive interview with TruNews on Apr. 24 (full audio interview), investigative reporter and newsletter writer Jim Willie told host Rick Wiles that the oil-rich nations of the Middle East plan for an eventual ditching of the U.S. dollar as payment for oil exports from the region. Sign-up for my 100% FREE Alerts

“In Easter weekend of 2010, there was a meeting of 200 billionaires who arrived in private jets in Abu Dhabi,” Willie said.  “And I heard about it from a very good reliable source.  And they decided on a lot of things, like policy toward Iran and how they’re going to handle things like Bahrain, and what they’re going to do regarding protection, and they made a decision.  They’re going to accept Chinese protection, and they’re going to accept the potential for an arms-weapon store from Russia, and they’re going to say good-bye to the American protection.”

While the U.S. pressures the international community to sanction Iran, China fears the move would cut its imports of Iranian oil, which in 2010 reached 12 percent of total Chinese imports of crude.  Saudi Arabia, on the other hand, reportedly fears that its oil revenue is in danger as the world moves increasingly off the dollar standard—a problem that Beijing’s strong renminbi currency offers as a solution to Saudi Arabia’s depleting cash-cow commodity.

Reminiscent of a deal struck between Russia and China in November 2010 to replace the dollar with renminbi and rubles to settle trade between the two countries, a meeting between China’s Premiere Wen Jiabao and members of the Saudi royal family was held a little more than a year later to discuss a back-up plan to the Iranian quagmire.

According to a Jan. 16, 2012, article in China Daily, “In what Riyadh calls ‘the largest expansion by any oil company in the world’, Sinopec’s deal on Saturday with Saudi oil giant Aramco will allow a major oil refinery to become operational in the Red Sea port of Yanbu by 2014.

“The $8.5 billion joint venture, which covers an area of about 5.2 million square meters, is already under construction. It will process 400,000 barrels of heavy crude oil per day. Aramco will hold a 62.5 percent stake in the plant while Sinopec will own the remaining 37.5 percent.

“The move reflected the two countries’ ‘firm willingness to join hands in coping with challenges and safeguard common interests amid profound adjustments to global situations’, Wen told Saudi Crown Prince Nayef bin Abdul-Aziz upon arrival in Riyadh late on Saturday.”

In January 2012, Iran shocked the world with a retaliation against a U.S.-led freeze of Iranian S.W.I.F.T transactions with an announcement that the third-largest Middle East oil producer will no longer accept U.S. dollars as payment for Iranian oil and that it would, instead, accept gold in addition to other currencies from China and India, among other nations, as settlement.

Mar. 29, 2012, New Delhi-based The Indian Express reported that a trade deal had been reached and signed between the leaders of the BRICS countries of Brazil, Russia, India, China and S. Africa—with Russia and China as the two lynchpin members of the extended agreement with India (nuclear weapons capabilities), Brazil and S. Africa.  The agreement includes dropping the dollar as settlement of trade between the five-nation compact.

The article stated, “The five-nation grouping of Brazil, Russia, India, China and South Africa (BRICS) today took the first step towards promoting trade in local currency, and also agreed to work towards creating a new development bank on the lines of the World Bank.”

Willie’s source told him the next step in the process to protect the BRICS, Iran and the oil cartel of the Arab nations is to strike the fatal blow to U.S. dollar hegemony with the “dollar kill switch.”

Russia’s overt intentions to protect Syria and Iran from U.S. aggression signals the tacit willingness of the BRICS to merge with Middle East members of OPEC, with Russia and China lending its military muscle to the expanded group of nation states.

But the kingpin of OPEC, Saudi Arabia, has one condition before it can take the final step: China must convince Iran to cooperate with the United States regarding Iran’s nuclear ambitions.

According to a cable leaked by WikiLeaks, published by the NY Times, a meeting in Riyadh between Foreign Minister Yang Jiechi of China and King Abdullah was held on Jan. 13, 2009, in which it was revealed that “Saudi Arabia understood China was concerned about having access to energy supplies, which could be cut off by Iran.”

“ . . . A later cable noted simply, ‘Saudi Arabia has told the Chinese that it is willing to effectively trade a guaranteed oil supply in return for Chinese pressure on Iran not to develop nuclear weapons,’”  the Times stated.

On April 26, 2012, Associated Press broke the story that suddenly Iran might be cooperating with the U.S.-led international pressure on the Persian state.  But Iran’s apparent decision to acquiesce to U.S. demands came following a meeting between Iran with Russia.

“TEHRAN, Iran — Iran’s official news agency says Iran might ratify the additional protocol of the nuclear Non-Proliferation Treaty (NPT),” stated AP.

“The IRNA report Thursday quoted Iran’s ambassador to Moscow, Reza Sajjadi. He said it could be part of a Russian framework under which Iran would stop expansion of its nuclear program if the West halts further sanctions,” the news wire agency added.

While the 200 Arab billionaires’ plan to execute a “dollar kill switch” may be a “year or two” away, according to Willie’s source, the foundations for an alternative to the U.S. dollar are clearly in place and solidifying rapidly.

Willie told his source that a “dollar kill switch” sounds like an end to the petro-dollar and “the Saudis have agreed to move on.”  Willie told TruNews’ that his source responded, “Bingo!” Sign-up for my 100% FREE Alerts

IT’S OFFICIAL: Keynes was Wrong—A Response to Henry Blodget

Yahoo Finance contributor Henry Blodget has, for now, taken the position that Paul Krugman and the Keynesians have it right, austerity doesn’t work.

Look at Greece; it’s austerity plan has kicked off an economic death spiral there.  Lower government spending reduces GDP, which reduces tax revenue, which requires further spending cut, and so on.  To right the problem requires government spending on projects designed to foster economic growth through investment, say the Keynesians. Sign-up for my 100% FREE Alerts

All sides of the economic debate agree on one thing, that is, avoiding the ‘liquidity trap’ in the first place, because, ultimately, someone has to pay during the Kondratiev Winter.  The question, then, becomes a political one, not an economic one.  Who pays?

“In the aftermath of a massive debt binge like the one we went on from 1980-2007, when the private sector collapses and then retreats to lick its wounds and deleverage,” stated Blodget, “the best way to help the economy work its way out of its hole is for the government to spend like crazy.

“Or, rather, if not the ‘best way,’ at least the least-worst way.”

Because the amount of debt from the private sector and government sector has reach levels which strangle economic growth, job creation and real incomes, adding more debt to a system that desperately wants to deleverage is natural behavior among its participants.  Therefore adding direct injections of money into a delevering economy will more likely cause consumer-price inflation and worsen the most important driver of aggregate demand, rising real income.

Economist Hyman Minsky stated in 1982:

Stable growth is inconsistent with the manner in which investment is determined in an economy in which debt-financed ownership of capital assets exists, and the extent to which such debt financing can be carried is market determined. It follows that the fundamental instability of a capitalist economy is upward. The tendency to transform doing well into a speculative investment boom is the basic instability in a capitalist economy.

In other words, participants during an asset boom period of the Kondratiev cycle were tricked into believing wealth could be created through ever-rising stock and real estate prices, driven by debt.  However, following nearly four years of the Winter period on the K-wave and declining asset prices, participants no long have the appetite for speculation (as they now see it for what it always was) and risk.  Those who took on too much got burned.  The mood has changed.

Naturally, the behavior of the consumer/investor has markedly changed, and all media propaganda leveled at consumers don’t square with their personal experience.  Confidence has been lost and the attempt to ‘trick’ the consumer to increase spending without gains in real income growth (further eroded by rising CPI) only serves to infuriate them, increasing the level of distrust for the system.

“Hyman Minsky (1977) and Charles Kindleberger (1978) have in several places argued for the inherent instability of the financial system but in doing so have had to depart from the assumption of rational economic behaviour …,” Fed Chairman Ben Bernanke wrote in 2000.  “I do not deny the possible importance of irrationality in economic life; however it seems that the best research strategy is to push the rationality postulate as far as it will go.”

Getting back to Blodget.  Further debt won’t ‘solve’ the problem of the tremendous forces of the Kondratiev Winter, but adding debt can impede the process of righting debt levels to match GDP.  How the two reconcile at a more sustainable level is in the hands of the Fed and foreign creditors.  Will savers be punished by the process of debasing the currency, or will debt be cleansed from the system through default or debt jubilee?

In other words, will savers and pensioners be punished by low interest rates and high inflation (for all), or will the lenders accept the loss and reward savers for their prudence?  Real or nominal GDP must decline to match the destruction of debt cleansing from the system.

There is only one other alternative, however, to the undeniable process.  War.  Napoleon and Hitler attempted that route.  Could that be the out for the Fed?

And for Blodget to argue that WWII and the massive government spending to fund the war lifted the U.S. out of the Great Depression is a specious one.  Could we consider that following the conclusion of WWII, the United States was the only significant industrial power not to have had its infrastructure and manufacture capacity destroyed by bombs?

Additionally, in 1944, the U.S. dollar became the world’s reserve currency.  Trade conducted in a currency issued by the only surviving industrial economy open for business on Day 1 of a peacetime economy lifted the U.S out of the Great Depression—despite the debt. Sign-up for my 100% FREE Alerts

Warren Buffett’s Dirty Little Secret

Billionaire investor and master of skimming life insurance premiums from young families fearful of leaving children behind with no means of support finds himself ingratiating himself with the American people in the hopes of deflecting one simple secret.  He’s a giant wolf in sheep’s clothing.

When that sudden death of fortune hit the Buffett family in 2008-9, his lack of planning for the unexpected was waived—all premiums were magically paid in full for the oligarch.  Sign-up for my 100% FREE Alerts

Your young family is too small and insignificant to matter, but the Oligarch of Omaha is too big to fail, we are told.  T.A.R.P and the higher taxes it implies down the road is essentially Buffett’s means for collecting on the back end of an unhedged empire, a gun to the head leveled by the U.S. Treasury’s collection agency—the I.R.S.  That, too, costs Buffett nothing.

“OUR leaders have asked for ‘shared sacrifice.’ But when they did the asking, they spared me,” Buffett began his Aug. 11, 2011 Op-Ed piece of the NY Times entitled “Stop Coddling the Super-Rich”.

Very clever.  He’s one of us, now, and he’s willing to pitch in for the sake of the country.  Touching, really.

Not only has Buffett been “spared” during the crisis, but he and his friends have benefited from Uncle Sam’s fascist business model for decades.  Would monopoly buster Teddy Roosevelt overlooked ‘too-big-to-fail’ mega banks, AIG and Wal-Mart’s raping and pillaging of each and every city downtown?

Now, Buffett wants, in addition to the premiums the young couple pays to him each month, he believes it’s also okay for the couple to be forced by way of I.R.S gunpoint to pay Buffett again to bailout his AIG and the dominoes of related Ponzi paper he has amassed.  That’s fascism with a chuckle, a Coke and See’s peanut brittle, and from the avuncular old man whose other monopolist billionaire friend Bill Gates finds so “loveable.”

When asked about the banking crisis on a popular daytime program, Buffett insists we stop picking on the bankers.  Why?  Because he made the exact same mistake as JP Morgan, Goldman Sachs, Morgan Stanley, as well as Citi and other NY money center banks, yet benefited from T.A.R.P no less, in fact, more, than any other human alive.

And how about Buffett’s “Buy American. I Am” article published in the NY Times in October 2008?  He reminds the reader of how bad things were in the Great Depression, but America came back.  The DJIA went from a low of 66 to 11,497.

He ends with:

I don’t like to opine on the stock market, and again I emphasize that I have no idea what the market will do in the short term. Nevertheless, I’ll follow the lead of a restaurant that opened in an empty bank building and then advertised: “Put your mouth where your money was.” Today my money and my mouth both say equities. Emphasis added.

Less than two years later, in 2010, Buffett is heralded by a complicit press of the fascism model as the one to follow back into the stock market.  His $34 billion “bet” on the future of America by buying Burlington Northern railroad was the feature story to a gullible American public.  If Buffett is buying “equities”, so should you, is the message.

What Buffett doesn’t tell you is that, his investment in Burlington Northern is really a camouflaged bet on inflation.  And lots of it, too.  But he sells his expectations of a much, much lower dollar as a ‘bet on America’.

Essentially, Buffett’s purchase of Burlington Northern kills several birds with one stone.

First, he is finally hedged for a decline in the U.S. dollar and further erosion of his paper empire.  In gold terms, Berkshire Hathaway class A stock is down nearly 75 percent against the arch enemy of the Fed and the U.S. dollar, gold.

But Buffett has a problem.  He cannot recommend gold; it would disrupt his relationship with the Fed and the fascist business model friends in Washington, of which, he has been the top crony and charming cheerleader—the Ted Bundy of Wall Street.

And to show his undying allegiance to the mob bosses in Washington, he made a complete fool out of himself (fraternity display of allegiance) with Berkshire Hathaway annual report diatribe against sound money, slapping the face of his father, who was a strong advocate of sound money for the people prior to “Sir” Allen Greenspan’s entrance to the hard-money chorus.

Buffett must be very big on actuarial tables.  What are the odds that the dollar defies 3,500 years of success in retaining value?  No fiat currency of the past three-plus millennia has survived—ever.  But Buffett won’t reveal the parlor trick of why he’s poo-pooing the idea.

The purchase (biggest ever for Buffett) of a railroad and its assets of land and cars will retain value during high inflation; it’s his sneaky hedge to a problem he sees coming but ain’t telling.  Inflation.

And, the best feature of all in the purchase of a railroad is: in the case of hyperinflation in America and the civil unrest it will most assuredly cause, the Feds are expected to tax real money, gold, at confiscatory rates as a form of capital control to support the dollar.  Again, it’s another job for the hit-men at the I.R.S.  But, if the military has to be deployed to protect vital infrastructure, Buffett’s railroad will be a part of that protection. Very clever.

The guy just can’t get himself to go it alone.  Buffett constantly needs a freebie by the Feds, but he wants you to believe he is a risk-taker and confident of a robust U.S. economy.  What a dirty little secret this guy lives with—and apparently he feels no guilt.  There’s a psychiatric term for people like Buffett, somewhere. Sign-up for my 100% FREE Alerts

Surprise Second-Half Gold Rally, Says Guru Economist

The man whose passion for urging investors to load up on gold bullion since the Fed tipped its monetary policy hand following the collapse of Lehman Brothers in 2008, has jumped a notch in intensity in his latest update for gold investors.

Stephen Leeb, economist and best-selling author, told King World News Washington lawmakers and Federal Reserve Board of Governors have been so reckless with their handling of U.S. budget deficits and monetary policy in response to the collapse of the global credit Ponzi scheme that he wants to move to Canada before the crisis in Europe blows up—because, after all, a repeat of the past will most likely strike again.  Sign-up for my 100% FREE Alerts

It was Europe that triggered the greatest economic depression in U.S. history—the Global Depression of 1873-96.  Then it was the U.S.’s turn to return the favor during the decade of the 1930s following the 1929 U.S. stock market crash which quickly spread to London, Paris and across the rest of continental Europe.

According to Leeb, the relatively sanguine Leading Economic Indicators (LEI) data streaming in of late is now topping.  The second half of the year will reveal what the Fed most likely already knows is coming, a catastrophe—the beginning of the next leg down in the global economy that will turn the most defiant of the reality confronting the U.S. into true believers.

Jim Rogers of Rogers Holdings and economist John Williams of shadowStats.com, too, expect the worst of the trouble to gather steam after the election.  The Fed is expected to preempt the downturn in the LEI with more QE.

“QE3 to me seems to be a 80-20 probability right now, within the next 3-4 months, or maybe even 90-10 given that there’s an election out there,” said Leeb. “I don’t see any reason not to be in gold at this point, even from a relatively short-term basis.”

“Long term, the case is so powerful it’s . . you know . . it’s crazy,” Leeb added. “Gold, gold junior miners, you know, you’re not going to believe what it gets to in five years.  I mean this is a gift—all these prices at this point, all of them.”

Leeb goes on to say the eurozone is seriously flawed, as the Maastricht Treaty of 1992 didn’t account for the problems that may arise considering the disparate economic models between member nations.  As an example, Germany’s culture of production and stable fiscal and monetary policy starkly contrasts with Spain’s culture of collectivism leanings and zestful social lifestyle.

“The euro is not going to last . . . Spain right now has about 25 percent unemployment, Leeb explained.  “They’re being forced to be austere to satisfy the needs of the euro, and that’s just not going to fly.  It’s no going to fly.”

Unlike some economies, such as the United States of post WWII, massive debt and deficits incurred by Spain cannot be grown into, according to Leeb.  U.S. production capacity and global position relative to its competitors after the devastation of Europe during WWII allowed U.S. deficits approaching 30 percent of GDP to quickly shrink to a surplus within several short years.  In contrast to the example of Spain, its model and position on the world stage cannot achieve anywhere near similar results.  Ditto for Greece, Portugal and other European nations.

“What does Spain produce?  I’m not even sure what Spain produces . . . They’re not a country that can really grow their way out of the kind of mess that they’re in right now.  And if that’s the case, soon or later something is going to break.

“And curiously enough, Eric, that is what’s holding gold; that’s the difference between gold being $1,600 today and gold being at maybe $2,500.”

Leeb continued by telling investors that the price of gold today already reflects the expectation of another plunge in the gold price in sympathy with a collapse in the euro, similar to the drop in gold following the surprise collapse of Lehman Brothers and the immediate liquidity a sold gold position provided the global financial system during that crisis in 2008.

Is FX Concept’s John Taylor wrong about gold’s probable fall to the $1,000-$1,200 level before retracing to new highs?  And for the time frame of his prediction, Taylor said in a Bloomberg interview in the summer of 2011 that sometime in April or May (of 2012) gold would become a super bargain.

Leeb says, probably not so.

“ . . . in Europe, it’s the same kind of calculus [a Lehman-like event].  People feel that there will be a major event.  When, is the only question,” Leeb said.  “And they’re a little bit scared to get into gold with both feet until that event is out of the way.  So my advice to people is, not buy that conventional wisdom because, it doesn’t usually play out the way people think [it will play out].

“But if it does, have a little money in reserve because, any drop you see in gold based on some catastrophe in Europe is probably going to be the greatest buying opportunity of your life.  And I’m not really kidding about that.”

Leeb is so convinced of gold’s meteoric rise following a potential sharp drop in its price that he even suggested buying the precious metal using margin.  Sign-up for my 100% FREE Alerts

Source: KWN

Eric Sprott: Record Silver & Gold Prices this Year

Speaking with GoldSeek Radio, billionaire investor Eric Sprott of Sprott Asset Management argued that gold and silver bullion will reach record highs this year.

“I think that gold was the investment of the last decade, and I suggested that silver will be the investment of this decade,” Sprott told GoldSeek’s host Chris Waltzek.  Sign-up for my 100% FREE Alerts

After bottoming near the $280 level in 2000, gold soared to as high as $1,200 before closing 2010 at approximately $1,100, for a 294 percent gain for the 10-year period.  On the other hand, silver began the year 2000 at $5 and ended 2010 at $16.25, for a 225 percent gain for the same period.

Sprott believes the precious metals will make new highs this year, a prediction not supported by Jim Rogers of Rogers Holdings and Marc Faber of Marc Faber Limited and publisher of the Gloom Boom Doom Report.  Though Rogers and Faber are bullish on gold and silver in the long term, both gentleman have said 2012 will be the year of further consolidation and a possible test of the 40-month moving average near the $1,200 level.

“I think both gold and silver will trade before the end of the year at new highs,”  Sprott told SilverSeek.com.

On gold stocks, Sprott said ETFs and trusts, such as the gold and silver trusts he offers, have diverted a lot of money out of the gold and silver mining shares and into the metals.

“I think it’s undoubtedly true that the amount of money going into gold-like products, such as ETF’s and our trust, have definitely taken away from the stocks,” he said, and added that it’s now silver’s turn to shine brighter than gold.

“And the reasons I come that conclusion is by watching what people do with their money,” Sprott continued.  “So for example, when we analyze, for example, the U.S. Mint sales.  They sold as many dollars of silver as they sold dollars of gold last year in terms of gold coins.  That means that essentially, with silver trading at a 50 to one ratio, people bought 50 times the amount of silver as did they gold.”

In addition to demand statistics, Sprott noted the available supply coming to market each year will put a lot more upward pressure on silver when compared with gold.

“The amount of silver that’s available for investment each year is 450 million ounces and the amount of gold that’s available for purchase is about 70 million ounces, which means you have a ratio of about six-and-a-half to one is amount of silver you can buy versus gold,” he explained.

“For the life of me, I can’t see why silver would massively outperform gold over the next few years.”  Sign-up for my 100% FREE Alerts

Utah Goes Rogue to Save Itself, Gold & Silver Now Legal Tender

After months of public outcry over Washington’s out-of-control fiscal and monetary policies, Utah Governor Gary Herbert signed into law Utah House Bill 157 Currency Amendment allowing gold and silver bullion as legal tender within the state to settle retail transactions and debts. Sign-up for my 100% FREE Alerts

Though several other states have proposed similar legislation, Utah becomes the first state of the Union to actually pass a law providing ammunition to fight back the ill effects of the Federal Reserve’s malicious debauching of the U.S. dollar.

The symptoms of rapidly rising costs of life’s necessities can be directly attributed to 10 years of money supply growth, not seen since the disastrous 1970s.   As of April ’02, M1 money supply has skyrocketed 77 percent to $2.22 trillion for April of this year.

And it’s going to get increasingly worse.  After compounding at a 5.9 percent rate throughout that 10-year period, the Fed has forecast another 17.4 percent increase in M1 through April 2013, a near trebling.

The signs of run-of-the-mill inflation metastasizing into hyperinflation now appears, giving rise to the notion that the reason for the politically unsavory executive order of the NDAA signed by Obama on New Years Day—which effectively suspends the U.S. Constitution—is to provide the legal authority to a sitting president to initiate martial law, including a civil uprising in the event of a collapse of the U.S. dollar.

Other states may soon follow Utah’s watershed legislation—and quickly.  In its annual World Economic Outlook publication, the International Monetary Fund (IMF) noted that a Eurozone breakup could rapidly disintegrate into a “full-blown panic in financial markets and depositor flight.”

Why?  The IMF knows that Greece’s economic collapse merely represents the tip of the EU iceberg.  Much larger European states, such as Spain, Italy, France, and even some have speculated, Germany, cannot survive the crushing debt loads coming due this year.  It’s truly the end of the road for a global financial system that tried an experiment of unbacked fiat currencies, globally.

“The potential consequences of a disorderly default and exit by a euro area member are unpredictable…,” according to the IMF report.  “If such an event occurs, it is possible that other euro area economies perceived to have similar risk characteristics would come under severe pressure as well, with full-blown panic in financial markets and depositor flight from several banking systems.

“Under these circumstances, a break-up of the euro area could not be ruled out.

And as Europe collapses, the U.S. will most assuredly go with it.”

Contrary to misinformation propagated by officials at the Fed and Treasury, Europe is the U.S.’s Greece—a warmup, a warning sign of systemic failure, according to many private economists and well-known financiers.

As early as the greater economic collapse of the Great Depression of the 1930s, the mother of all Depressions of the 1870s, severe recessions and depressions, currency crises and bank panics on either side of the Atlantic have rippled globally.  The Bank Panic of 1907, which began with the fall of the Knickerbocker Trust Company in New York, quickly spread to Paris and Rome, collapsing France and Italy, leading to recession in Europe.  This time, with electronic banking and communications as they are, is certainly no different.

Back then, financial ruin was creeping into the U.S. economy as the result of the U.S. Civil War of 1861-65 and the failed Greenback that funded it.  That war’s cost, reminiscent of the money borrowed and spent for post-WWII wars fought overseas, culminated into hard times more severe and lengthy than the better-known Great Depression of the 1930s.

“This could cause major political shocks that could aggravate economic stress to levels well above those after the Lehman collapse,” the report concluded.  And that’s when financial Armageddon begins in earnest, according to many the world’s well-respected economists.

It is now that, even the more disengaged Americans among the population of 310 million can wrap their minds around the bizarre sequence of political events of the past decade, beginning with the Patriot Act, then NDAA, to most recently,  Executive Order—National Defense Resources Preparedness (NDRP)—an order which gives guidance to all U.S. Departments to activate a National Defense Executive Reserve (NDER) in case of national emergency or peacetime (i.e., preparations). (1)

In other words, at the very least a currency collapse is coming.

Fox News stated on March 19:

The purpose of the order [NDRP], according to its contents, is to make sure the U.S. is prepared to mobilize technological and industrial resources ‘capable of meeting national defense requirements’ and ensure ‘technological superiority of its national defense equipment in peacetime and in times of national emergency.’

Within the context of these rapid-fire Executive Orders, pending legislation to deny or suspend passports for delinquent taxes; record gun sales; the rise of the OWS and ‘Prepper’ movement; and the record flight of Americans leaving the U.S. for good, Utah sees the writing on the wall, as do, apparently, many more Americans.

It’s only a matter of time when many of the other states sign into effect similar laws to the one just passed by Utah. Sign-up for my 100% FREE Alerts

(1) Could this be the reason for record-low gold stock valuations (compared with the price of gold bullion)—the fear of a Venezuela-like confiscation?

KWN Cyber Attacked Following Gold Market’s Deep-Throat Interview—The Secrets of the Temple Revealed

King World News is under a vicious ‘distributed denial of service’ cyber attack once again, according to GATA.org.

The attack on Friday of KWN’s servers is the latest of several previous attempts to disrupt Eric King’s broadcast of interviews that expose to the public the extent of the JP Morgan precious metals manipulation scheme—a scheme in full progress, yet still not resolved by the CFTC after two-plus years of the watchdog’s ‘review’ of the evidence. Sign-up for my 100% FREE Alerts

Friday’s attack is believed to have been prompted by proprietary trading data offered up by KWN’s Anonymous London trader regarding a large “Asian buyer” and this buyer’s trading patterns.  It now appears that, according to Anonymous, this large buyer has successfully ‘cracked the code’ of JP Morgan’s equally-large client’s algorithm used to achieve optimum and cost-effective price-suppression tactics in the gold and silver market.  The motive for such a criminal act is obvious to international financiers: capping the gold price lends support to the US dollar.

“Interestingly, the Asian buyers have figured out the algorithms, like breaking an enemy’s code in war, and they are using the algorithmic trading to get the best prices each day for physical gold at these levels,” Anonymous told KWN in the interview that apparently prompted the attack. “The trading is just taking place at lower levels because these bullion banks and the Fed, which manage the price of gold, get overzealous in their price fixing.”

Beginning with the GATA roundtable discussion in March 2010 regarding a vital and material witness to the scheme, Andrew Maguire, and the suspicious mob-like hit-and-run incident that threatened the lives of Maguire and his female companion shortly after Maguire’s shocking announcement of his meeting with the CFTC about the JP Morgan scheme, some person or organized cyber cabal has periodically attacked King’s servers following key interviews with experts providing play-by-play commentary of the ongoing financial crimes committed by the beleaguered Fed and its primary dealer network.

GATA’s decade-long work has demonstrated how the precious metals manipulation scheme works in impressive detail, but prosecution of the case requires a witness to the fact alleged by GATA; that witness is Andrew Maguire.

Two years later, the attacks started again—and the subject of manipulation discussed by one of the world’s leading experts of the gold market, Jim Sinclair of JSMineset.com, as well as Anonymous’ witness to the “Asian buyer’s” entry into the fray, was again the catalyst for the DDoS barrage.

“The attacks started when the London trader interview piece was released April 5,” King told GATA, Friday.  “The attacks continued and intensified when our interview with Jim Sinclair’s futures market analyst, Dan Norcini, was published on April 11.  A very powerful entity did not want this information out there.” Emphasis added.

Due to privacy laws on both sides of the trade, JP Morgan’s large naked short sell-side client can’t be revealed, and the buyer’s identity can’t be disclosed either.  But the overwhelming suspicion by the gold market’s premiere experts as to whom JP Morgan’s big naked short-seller is points to the NY Fed.

Consultant to the Department of Defense Jim Rickards in his interview with TruNews Radio of Apr. 11, explains the grossly unappreciated role gold plays in geopolitics between the US and the biggest Asian buyer of the precious metal, gold: China.  But Rickards stops short at the time of the punch line.

“So Russia, China, Brazil, the other BRICS countries that you mentioned have very large dollar holdings,” Rickards told TruNews’ Rick Wiles.  “So they’re watching their savings account in effect evaporate or melt as we cheapen the dollar, so they’re looking for alternatives.  One of them is gold, but gold is very difficult to find and when you start buying it you tend to drive the price upSo if you want to buy a lot you’re going to be paying higher and higher prices.” Emphasis added.

Precisely.  China needs a counterparty to provide ‘dig up’ the gold—the weak hands.

What Rickards neglects to add in the interview with TruNews is that, for China to offer an alternative to the dollar in a new reserve currency scheme endgame, it will have to match the US’s alleged 8,150 tons and the Europe’s verified 10,000 tons of European gold to earn a seat at the BIS table.  Why else would there be a reason for a meeting in the first place?

Is it any wonder why the Germans refused to back the EFSF with German gold?  It also explains why the US and now, Germany, have no interest in auditing their respective gold holdings.  Military capabilities, oil reserves and gold holdings are secrets necessary for national security.  How much gold does China really have?  No one knows.  All mined gold within China’s borders and procured directly by the PboC are not necessarily accounted for in official disclosures.  The same can be said of Singapore and other ‘money center’ jurisdictions.

Moreover, if China’s “savings” are dominated with and denominated in dollars and euros, what would give China the upper hand in the negotiations to have the renminbi included in a new gold-backed SDR?  A collapsed dollar and euro won’t include trade surpluses anytime soon for China with a heavily weighted trade component to its GDP.  Therefore, it’s fiat currency reserves won’t mean much now that the jig is up for the dollar, and by extension the euro, of which, together represent approximately 88 percent of global paper reserves.

Therefore, Beijing needs to replace as much of its dollar holdings to gold holdings while the dollar remains a viable trading currency.  And Beijing has the patience to play the other side of the Blythe Masters gold giveaway trade.  Beijing has no plans to trash the dollar at this time unless it wants to use it as a weapon in the geopolitics of Iran—which incidentally would like to receive gold for its oil if push comes to shove in its maneuver to counter a SWIFT blockade.  Russia’s military approves of Iran’s decision.

No one is trying to run down Jim Rickards in the street.  And that’s why the Anonymous’ play-by-play of the real war has the NY Fed frantic.  Is it a coincidence that Blythe Masters has suddenly begun to make appearances on financial television to ‘explain’ JP Morgan’s position on the matter of manipulation.  And who else has the clout to impede a CFTC determination of whether the gold and silver market have been, and are, manipulated? Sign-up for my 100% FREE Alerts

Tim Geithner Spills the Beans, U.S. Debt Crisis Looms

As the European sovereign debt crisis quickly spreads to Spain (again), with the Spanish 10-year bond yield once again soaring past 6 percent (on its way to the magic red-alert yield of 7.5 percent), the half-life between sovereign debt bailouts appears to be diminishing.  Predictions of a four-year time window to prepare for the mother of all currency crises could turn out to be overly optimistic, with the latest rumblings that suggest the math won’t work a lot sooner than originally estimated by some economist and analysts focused on the problem.

So says U.S. Treasury Secretary Timothy Geithner, if lightening has indeed struck again.  Sign-up for my 100% FREE Alerts

From the weekend program, Meet the Press:

DAVID GREGORY: If we don’t deal with these debt problems we are going to be Greece in two years”

GEITHNER: “No risk of that.”

A year earlier, when Geithner was asked about scuttlebutt brewing of an impending downgrade of U.S. debt, he assured the world that there is “no risk of that” either.  Weeks later, rating agency Standard & Poor’s rocked the financial markets with an announcement of a debt downgrade of the world’s remaining superpower.

Geithner, once afforded the traditional benefit of a reasonable measure of public trust, lost all credibility on the day of the S&P announcement, as a case made that the highest-ranking Treasury ‘official’ wasn’t privy to an impending historic milestone of such gravity was never attempted by anyone in the Obama administration.

Could Geithner have slipped up again?  Does he know the dollar’s days number less than two years’ worth?

Though a stretch, as it may appear, Geithner’s otherwise carefully measured responses during his tenure as Treasury Secretary have at times been marked by fits of overplayed knee-jerk protests—’me thinks’.  As in the case of S&P, it’s become clear that Geithner may exhibit a ‘tell’ under certain moments of duress.

If U.S. debt and current account deficits weren’t so bizarrely high, coupled with a likelihood of GDP contraction in the U.S. next year coming more into focus; and a growing repulsion by overseas creditors to accumulate more debt, investors could reasonably accept Geithner’s word on the subject of solvency.

But one economist, in particular, is quite sure that 2014 will be the end of the line of 40-years-plus of deficit spending without tears.

“We’re at a scary point in time” in U.S. fiscal history, economist John Williams of ShadowStats.com told Financial Sense Newshour in March.  “Our [U.S.] circumstances are a lot worse than the European situation, in aggregate.  The European situation will work its way out one way or another, and the markets will focus back on the U.S.  I cannot see anyone wanting to buy U.S. Treasuries.”

Williams went on to say that as soon as there is any relief in the crisis in Europe, the bond vigilantes will begin to take notice of the overwhelming fiscal problems confronting the U.S. and its Greece-like characteristics.  For now, he said, the dollar is less ugly than the euro, but that won’t last very much longer.

“The U.S. is the elephant in the bathtub here . . . the European crisis is more like the little yellow rubber duck floating in the tub,” Williams added.  “There will come a time when the markets will begin focusing back on the dollar.”

And that time could be a lot sooner than many in Washington care to admit, according to Williams.  “I expect it to all come to a head in 2014.”  There will be hyperinflation, he said.  It’s only a matter of time and not much can be done about it other than drastic cuts to entitlements and accept a deflationary collapse.  And Williams isn’t giving that scenario much chance.  Sign-up for my 100% FREE Alerts

Insiders Tell Jim Sinclair, $17 Trillion in QE Coming

No matter how the Fed tries to manipulate the markets through its orchestrated communiques, more ‘quantitative easing’ is coming, says ‘Mr. Gold’ Jim Sinclair.  And this time, $17 trillion more of Sinclair’s mantra “QE to infinity” is a done deal, according to him. Sign-up for my 100% FREE Alerts

How does he know?

“How does anyone know an answer to a question?  By being told.  By having sources,” Sinclair revealed to King World News, Friday.  “I’m half a century in the business.  I’ve constantly kept up my contacts in a very unique and focused way.  Quantitative easing was made clear to me, prior to Bernanke’s speech to the Washington group, prior to quantitative easing.”

The 50-year-plus veteran of the gold market first came to use the term “QE to infinity” back as early as the summer of 2009, suggesting he knew all along that the Fed had finally reach a liquidity trap and that it was inflate or die from then on.

Nearly three years later, there’s been no chink in that assessment, as evidenced by the Fed’s subsequent QE2 program, bogus currency swaps schemes as well as the most recent backdoor bailout of Europe through the Troika earlier this year.

“The next step in the formula is the fatigue of Asia in supporting bad Western monetary habits and QE to infinity to protect the long term 28 year up-trend line in the 30 year U.S. Treasury bond market,” he said in a Jul. 2, 2009 post.

A look at a 20-year chart of the 30-year Treasury reveals the trend line Sinclair had spoken of.  Investors seeking clues to the dollars next major move could find in the chart of the 30-year bond.

Both the MACD and Slow STO indicate intermediate-term technical topping in the 30-year bond, and the trend line has held ever since the Jul. 2009 post.

As far as the outlook for the gold market, Sinclair is as bullish on gold as he’s as sure of more QE from the Fed.

The battle, he said, for the Fed is to fight the rise in the gold price for as long as possible prior to the next formal announcement of further Fed expansion of its balance sheet.  A move through “$1,764 and they [Fed] lose control.  That begins the move which is exponential.

“It’s a formidable challenge (keeping gold below $1,800).  The true range of gold is $1,700 to $2,111, but these guys are going to try to fight it like nobody’s business.”

However, the fight will be lost and the breakout above the $1,700 to $2,111 range is inevitable following the next QE announcement by the Fed on the way to trillions more.  That, Mr. gold has no doubt.

He concluded, “If we’ve done over $17 trillion already, do you think we won’t do another $17 trillion?  Of course we will.” Sign-up for my 100% FREE Alerts