Summer Ends

FED INTERVENTION

YIELDS SINCE 2007

2-10 Yr. Spreads

The fact that Asia obtained these traits in a different order from that of Europe is of
the greatest significance. We shall devote much of the rest of this book to examining this
subject. At this point we might point out two aspects of it. In 1830 democracy was
growing rapidly in Europe and in America. At that time the development of weapons had
reached a point where governments could not get weapons which were much more
effective than those which private individuals could get. Moreover, private individuals
could obtain good weapons because they had a high enough standard of living to afford it
(as a result of the Agricultural Revolution) and such weapons were cheap (as a result of
the Industrial Revolution).

By 1930 (and even more by 1950) the development of
weapons had advanced to the point where governments could obtain more effective
weapons (dive-bombers, armored cars, flamethrowers, poisonous gases, and such) than
private individuals.

Moreover, in Asia, these better weapons arrived before standards of
living could be raised by the Agricultural Revolution or costs of weapons reduced
sufficiently by the Industrial Revolution. Moreover, standards of living were held down
in Asia because the Sanitation Medical Revolution and the demographic explosion
arrived before the Agricultural Revolution. As a result, governments in Europe in 1830
hardly dared to oppress the people, and democracy was growing; hut in the non-European
world by 1930 (and even more by 1950) governments did dare to, and could, oppress
their peoples, who could do little to prevent it.

Turd: what is your comment on the silver COT? How extreme can the commercial go?

Head Of Iran's Revolutionary Guards: "A War With Israel Will Occur"

Submitted by Tyler Durden on 09/22/2012 - 09:44

Even as the popular ADHD affliction is preoccupied with who paid what taxes, and whether this poll shows that guy on top or this one, until tomorrow when they flip providing even more meaningless chitchat opportunities, everyone appears to have once again lost sight of the big picture, which is that two US ships continue full steam ahead toward Iran, namely the CVN-74 Stennis aircraft carrier which has crossed the Pacific ocean and is now a week away from its target, and the LHA 5 Peleliu big deck amphibious warfare ship, where they will join two other aircraft carriers and the LHD 7 Iwo Jima as summarized by the graphic below. Why is US naval presence in the Gulf soaring to a concentration not seen since the last Gulf war? The head of the Iran revolutionary guard may have an idea.

From Reuters: Israel will eventually go beyond threats and will attack Iran, the commander of Iran's Revolutionary Guards was quoted as saying on Saturday. "A war will occur, but it's not clear where or when it will be," Jafari was quoted as saying on Saturday. "Israel seeks war with us, but it's not clear when the war will occur."

And when a war does break out, the only question is what China, Russia and India will do. Iran's stance is clear: "If they (Israel) start something, they will be destroyed and it will be the end of the story for them," Jafari said, according to ISNA.

One thing is guarranteed: in one-two weeks US naval presence in the 5th Fleet will be unprecedented, consisting of at least 3 US aircraft carriers, and 2 amphibious warfare groups, excluding any other naval support the rest of the developed world will throw in.

http://www.zerohedge.com/news/2012-09-22/head-irans-revolutionary-guards...

Awesome work, thanks for your prolific posting. I do so much appreciate your work here, please keep it up. Those charts above are fascinating to me.

Regarding brokerage I was interested to learn US brokerages put assets into a pool account and insure it in case of a default by the broker. Switzerland on the other hand forces brokers to register securities in the name of the customer. For this reason Swiss banks/brokers seem to be significantly safer at least from a securities perspective. I checked one big US broker and their insurance covered damages up to 500,000 USD. Whilst that might be enough for some you also need to worry about the solvency of the insurer. Remember AIG?

In the case of CFDs, spread betting and forex trading, all that matters is the solvency of the bank you deal with as they are always the counterparty. For transactions like this I use Swissquote, who aren't the cheapest, but who do have a good track record.

Turd you might find this interesting. The price quotes on the 'exchange' if I understand this correctly are all delayed by several seconds according to this link it turns out. The 'proprietary houses' who pay a fee have first dibs within milliseconds of the actual action. -

http://maxkeiser.com/

this is therefore a short term massive wealth redistribution scheme.

Just found this on Youtube, so if you have some free time this weekend you might want to watch it. However if you think Obama is doing a fine job you'll probably want to skip it. ;)

https://www.youtube.com/watch?feature=player_embedded&v=tDY6v8KdSYs#!

or http://www.youtube.com/watch?&v=tDY6v8KdSYs#!

http://www.tfmetalsreport.com/forum/4210/gmosgenetically-modified-organisms

This is the proper address for the forum.Other was 'new topic' page.you may have already noticed.My stupidity  knows no bounds,except I usually spot it eventually.

you are correct...............most of my generation has RUINED their children.....and now they are ruining THEIR children

i, however, am definitely not guilty of this.

and i do not blame these spoiled children.

last four generations getting ready to pay for 50 years of robbing the future.

but that is human nature...........the cycle resets and starts over again.

and some ask:  human nature changes due to learning from the past?

thats pretty funny boatman says.

What a monumentally beautiful quote!!  Thank you for brilliantly coining THE perfect phrase, which will allow me to "pull it out of the hat", or "kick the sh_t off the shovel", and come out smelling like a rose, after my next (and all subsequent) verbal blunder.  Next time I go out to tank-up on good Cdn beer, I'll have it covertly written on my wrist...I'll surely need it.

THANKS, thurd aye, and for the GMO forum as well!

You said:

don't you think QE will be continued past the 'wealth effect' failure in the DOW ..........to finance the country until the currency  comes to a crisis point and then there is a partial default?

or maybe you believe that crisis point is reached in mid 2014.......probly it is what your charts tell you.

What i meant is that the efficiency of QE to prop up wealth effect (without increasing inflation heavily, remeber- that is another debate that needs to be covered a bit more thoroughly, as it misleads people into thinking that GOLD and SILVER prices are somehow linked to the actual inflation visible as CPI or Shadowstats- they are not, the are linked only to the USA debt and money supply arising from it, while everyday inflation would appear if USD would circulate- but they do not , at least not enough to bring this monetary inflation into real economy) will degrade to 0. If CPI kind inflation gets too big, by further devaluation of USD, the things will go out of hand, business will stop as metrics disappear, and there will be no wealth effect whatsoever. Of course, if there will be no huge inflation in real economy which without QEs would have been in deflationary gap spiral already from 2009, printing will continue longer than effect will be 0, but not too much longer as it is driving USA debt to unsustainable levels and threatening with real hyperinflation which will arise if USA default will be deemed imminent ( which it is) . So, at one point of the game, the printing will have to be stopped, and partial default engineered in a way that brings NOT inflation, but deflation. The whole policy of the USA is already from perhaps before 2008 moving in the direction that would make such partial default possible. That partial default is a thing that my charts predict  ( and hence end of QEs ) in about early 2016. And after that, collapse of the PM bubble.

Have You ever seen a banker that would accept hyperinflation ( that is , cancelation of all debts nominated in USD the same bankers have been giving out for decades?) . You think, but they will get collateral!  . Imagine a banker getting 2% when inflation is 10%, not to speak about hyperinflation. If the currency remains strong, banker will get collateral if loan is defaulted. If its not defaulted, he will receive interest payments in good money. If money is inflated, he will receive REPAYMENT of the loan in worthless paper. So, bankers will make a choice to default USA debt, partially, in a way that is deflationary or neutral for USD. That will be in FEDs hands, as it seems today. My favorite idea for today is that government will default to the FED, and the FED will have worhless treasuries in its asset  size. Inflationary would be repricing of other assets by accounting tricks to move the assets back in line with liabilities - FRN in paper and digital. Deflationary would be to demand more solid collateral from banks that have loans from FED, to recreate the asset side , which will create a chain reaction in banking system, drying out credit=deflating money supply. That is why PM prices will then drop.

QE3 generates speculative frenzy which may drive PM prices up for a short time faster than exponential they have been following but as such, 1 trillion addition to US debt within a year only ads about 6% to USA public debt and 3% to total debt  ( incl. private/corporate) , so PM prices should add these 6% or 3% to the usual growth of USA public debt by about 6-10% a year , and less so in total debt- so PM prices due to monetary inflation+QE3  should increase around 10% /year in 2012-2013. However, real inflation lags far behind despite Shadowstats etc as most of this new money does not circulate- not because FED controls it, but because everyone is deleveraging and afraid to invest. Capital preservation instead of accumulation.

So , yes , I think QE effects will vanish from all spheres in end of 2014, and after 1-2 years bankers will wind up this episode in a massive deflationary event- which will involve partial default on debt owned to FED. Before that, US military will make sure that USD is still worlds reserve currency , may be even more so, accepted for e.g Central Asia resources and military protection racket that most (ALL) Western countries have outsourced to the USA.

At the same time, military engagements will serve to policize the country to bring population under feudal control of government vassals - bureaucracy, technocrats, specialists police, etc, - intermediaries between politicians and voters.

After 2016-2017 when deflation will set in, worldwide, militarization will remain the only deflationary gap closing activity so actively unstable world will be preferable to the USA in that time, but arms race will gain momentum in all able countries. I do not think any big conflicts will happen yet as no one is ready to oppose USA in conventional warfare, and nuclear threats are not made so easily.

So the USA will continue to expand the empire to reduce the costs of resources and labor. So will other potential empire builders- China, Russia + someone, may be Europe. What ever the coalitions, in some time there will be again 2 or 3 blocks (empires) with largely similar potential and aim for one empire under their leadership, as dwindling resource base will ask for further elimination of transaction costs by removing all barriers- just to retain status quo. Nation states will play no role in this-in scarcity, they are unaffordable.

Something like this should unravel after 2016-2017 and continue for many years as empires strengthen around their cores. And then...

Of course, on a brighter note we may see new accumulated energy source being made available to everyone. But, as Tainter has put it, under dwindling economy, the resources spent on research will be eaten up by more basic needs and militarization, hence the effort for new energy source will be decimated and, may be that would be enough to kill possible success.

appreciate the comeback and i agree with almost everything.

Someone had mentioned that now that the price of silver was heading towards $35, we may see a hike in MARGINS on the futures.  I highly doubt it.  Why?  Because during the run of silver from $17 to $49, JPMorgan was not shorting the markets.  As Bill Murphy stated from his source... JP Morgan was not allowed to participate in the silver market at this time.

That is why the COMEX had to use 5 margin hikes in 10 days.  Today, we see that Morgan et al are indeed shorting the market as the price heads higher... so there is no need for a MARGIN HIKE.

Have you seen RHODIUM??  Down $175.00 or 13%

I recently wrote Ned Schmidt about his last article dated in Aug stating that silver should not be invested in.  After I sent an email, he must have been inspired to write another article further calling those invested in silver ... crazy.

I really plan on CRUCIFYING his precious metal forecasts when gold goes over $2,000 and silver $50.