GLOBAL MONEY WAR REPORT
DEBASED CURRENCY COMPETITION
SOVEREIGN BOND BREAKDOWN
CENTRAL BANK DISCREDIT

* Intro Monetary Fragments
* Cyprus Stench & Tax Template
* Bank Seizures Under Guise of Restructure
* BRICS Fund Dawn
* Chinese Yuan Wins Global Reserve
* USDollar Loses Global Reserve


HAT TRICK LETTER
Issue #109
Jim Willie CB, 
“the Golden Jackass”
21 April 2013

Editor Note: Due to the extreme situation among bail-ins linked to bank busts and the gold market ambush assault, not much attention is paid this month to Europe. Apologies to the many European clients, but space and time are at a premium. The continent is simmering on the verge of collapse, to be sure. The bank runs are just beginning, an extension of the lost confidence aft er the illicit Cyprus account taxes. The rate of business failures in Italy and Spain is alarming. The capital flight out of Italy (including gold bullion) is astonishing, matching that out of France where the Tobin financial tax is a spectacular flop. Corruption at the top is the other common link among Italy, Spain, and France. Like Cyprus, the nation of Italy might be forced to forfeit its central bank gold, which could cause riots in Rome. The European leaders have no idea what capitalism is anymore, and will preside over total collapse as their socialist solutions laced with bank welfare will make all worse. My hope is to cover Europe in more depth in compensation next month.

"Totalitarianism, however, does not so much promise an age of faith as an age of schizophrenia. A society becomes totalitarian when its structure becomes flagrantly artificial: that is, when its ruling class has lost its function but succeeds in clinging to power by force or fraud. Such a society, no matter how long it persists, can never afford to become either tolerant or intellectually stable." ~ George Orwell

"Notwithstanding Bernanke's assurances about eventually, gradually making a smooth exit, the Fed is domiciled in a monetary prison of its own making. These [unsustainable fiscal] policies have brought America to an end-stage metastasis. The way out would be so radical it cannot happen." ~ David Stockman (budget director in Reagan Admin, referring to a geriatric cancer stage in the American republic)

"The growth of the Internet will slow drastically, as the flaw in Metcalfe's Law, which states that the number of potential connections in a network is proportional to the square of the number of participants, becomes apparent. Most people have nothing to say to each other! By 2005 or so, it will become clear that the Internet's impact on the economy has been no greater than the fax machine's." ~ Paul Krugman 1998 (bonafide moron and lackey winner of a meaningless Nobel Economics Prize, whose stupidity is being revealed over time)

"Money enjoys almost insatiable demand. This attribute has ensured repeated episodes of gross over-issuance that has plagued mankind for centuries. These days, Money is the domain of the government debt and central banking nexus. The monetary black plague is back and it has spread globally like never before. Yet it is virtually invisible and comes with a surprisingly protracted incubation period." ~ Doug Noland (the Prudent Bear)

"The developed world has now become a fully operational Something-for-Nothing society. Once a Something-for-Nothing psychology has been fully implemented, the majority of its citizens have become the functional equivalent of locusts! Once they have achieved voting majorities, the economies they inhabit are much like a farmer's field. They eat everything down to the roots and next years seed corn. Nothing is left to create future wealth and total destruction of production of wealth is the result." ~ Ty Andros (indirect reference to capital destruction)

## INTRO MONETARY FRAGMENTS

◄$$$ SOME SAGE COMMENTS ON THE MESSY GLOBAL SITUATION, THE BREAKDOWN COMING, AND THE ADVENT OF BARTER. $$$

The trusted source with global gold market and banker connections has provided some valued comments. His points, my edits to make it flow, which should be read as a guide of what is to come. The speculations have turned rampant, with many irrelevant analyses of the old fading school. Centered on Europe, as his comments came before the April 12th and 15th gold market smashdown, evidence of banker suicide. The new billboard item accepted is that France has joined the PIIGS, another broken Club Med nation. They will be included in the Latin Euro with steep devaluation and resulting price inflation. Russia and China are assuming the leadership in the sphere of influence formed by the BRICS countries. Jim Willie's observation that the USDollar is being replaced as a trade settlement currency is correct. The currently used Euro could collapse before the USDollar does, due to the added political complexity. The Western world banks are all defacto bankrupt and the many pension funds replete with vacant promises. The Western economies run at a 25% inflation rate. The inflation has not been recognized yet, since the viral growth of central bank money creation is currently contained within the ring fenced banking system. Whoever keeps money in the bank, in stocks, bonds, and life insurances will end up losing almost everything. Precious metals in bars and coins are excellent to own in protection for what will unfold.

Even the Troika is stealing Gold from Cyprus, but that is only the beginning. Spain, Portugal, Italy, and France are next for supposed predatory solutions. The people cannot seem to stop the grabs from the higher shelves done by the elite. Once people fully comprehend the truth with facts on how they are subjected to mega government scams, a big problem for the power jockeys will be presented. The people of Cyprus just had a taste of how that works. All others in the West will soon find out. Curiously, coffee, alcohol, and medical supplies will also become treasured items. A friend of The Voice just bought ten thousand one-liter bottles of AAA vodka for 6.9 Euros each. He can sell bottles for a 30% profit later on, like when the Euro currency implodes. People have begun preparation. What comes is a new trade system. Barter will rule royally, having been introduced with the Chinese Yuan Swap Facilities. More formal barter platforms will arrive. The gold trade settlement will be introduced in time as the eventual device for transactions, pushing aside the toxic USDollar. The immediate new trend is the secretive grabs of gold bullion from the troubled Southern European nations. The rush by people all over the world into physical is on, even though the bankers will enable the discharge.

◄$$$ CANADIAN PUBLIC TELEVISION AIRED A SHOW ON MAJOR BANKS AND THEIR CORRUPT INFLUENCE ON THE GOLD MARKET. IT WAS LED BY ERIC SPROTT AND JOHN EMBRY. THE SHOW WAS AN IMPORTANT EXPOSURE OF ILLICIT CONTROLS AND MANIPULATION IN THE GOLD MARKET. THE TIMING WAS PERFECT, IN RESPONSE LIKE AN ECHO TO THE MID-APRIL GOLD MARKET AMBUSH THAT REEKS OF CORRUPTION. THE BANK CARTEL IS SLOWLY BEING REVEALED FOR SOME OF ITS INSIDIOUS FACES. $$$

The Jackass heard about the important big bank exposure show back in October from Bill Murphy of GATA. So it has been over six months in arriving on the air. My guess is they removed key negative damning points in order to win approval to present it. However, it was indeed hard hitting in its content. The leading duo from Sprott Asset Mgmt was the driving forces of presenting the case of illicit market controls and price manipulation. The show's title cited the secret world of gold and its hisotry. Of the 30 minutes duration, a sufficient 20 minutes were devoted to the current corrupted gold market, but the information was dense and potent. Sprott and Embry made the case for empty insolvent big New York and London banks, the likelihood for big bank collapses, empty Fort Knox with no gold bullion in reserves, naked shorting of gold futures contracts, frequent price manipulation, and more.

The high impact show featured other notables like Andrew Maguire who focused on gold price manipulation, done on a regular basis with repeated methods. It featured Sporn, the lawyer who won a lawsuit against Morgan Stanley in 2004 for improper vault fee charges without metal in storage for account holders. It featured CFTC commissioner Bart Chilton, but his portrayal was more a buffoon with good intentions with no budget or power. It featured Frank Venoroso on the backgrounds of central bank gold history. It mentioned how Russia & China are in a major accumulation phase, as the Eastern nations are aggressive buyers while the Western nations are working to control the gold market even as they are discharging gigantic volumes of gold from their own banks. Only one factual error was cited. The show claimed that the USGovt paid gold owners in the 1930 decade a price of $35 per ounce. In fact, they were paid only $20 per ounce for their gold. The US Federal Reserve promptly pushed the gold price to $35 in order to recapitalize the US banking system. A small but critical error.

In the October conversation with Murphy, my expressed hope was for the show to be aired and released in full glory. But my suspicion was for it to be heavily diluted in its message. It apparently was not diluted much. Although JPMorgan and HSBC were each cited as chief price manipulator agents, a missing complicitous player in ScotiaBank was not mentioned, a possibly compromise. My concern expressed months ago was that threats of losing broadcast license might be involved, or even threat of having the producer's daughter killed. Plenty of precedent. Last summer, when a CNBC online executive showed a nasty segment on multi-$trillion banker loans arranged by central banks, all his children were killed with their throats cut, and the nanny was blamed and killed (naturally a suicide). See the Canadian Broadcast of the "Secret World of Gold" the DocZone video (CLICK HERE).

◄$$$ JAMES TURK FORESEES ENORMOUS FINANCIAL DESTRUCTION AHEAD. HUGE AMOUNTS OF MONEY DEPARTED CYPRUS BEFORE THE SHUTDOWN, WHICH HAS ULTERIOR MOTIVES SINCE A BAILOUT WOULD HAVE BEEN EASY AND CHEAP. EXPECT MASSIVE WEALTH VANISHING FROM BANK CONFISCATIONS. A MAJOR BANK FAILURE CONTAGION IS COMING. $$$

James Turk, founder of Gold Money, offered several key quotes. They are taken in segments molded together. He said, "The [Gold price] downdraft is a final desperate attempt by the shorts and central planners to shake out some more physical metal from weak hands. I do not think they will be successful given that both Gold & Silver have rallied several times from these support levels over the past couple of years. What Cyprus makes clear is the realization that there is not enough money in the world to bail out the banks. So to keep the political experiment called the European Union alive, the oligarchs in Brussels have now resorted to stealing depositor money. The important point here is if they can steal it in Cyprus, they can do the same in Spain, Italy, or any other country where the banks are insolvent. The reality is that most of the global banking system is insolvent. It is essential to have money outside the banking system, and the best way to do that is to own physical Gold & Silver.

The oligarchs in Brussels are taking it from the remaining depositors in the Cypriot banks. The conclusion is that banks are dangerous to your wealth. It is important to note that the Euro Central Bank could have avoided this mess by simply printing up several billion Euros and giving it to the banks, in effect sweeping the mess under the rug. Instead, the Eurocrats decided to play hardball. One has to ask why. The reason for this is because they are getting ready for bigger bank failures. The Dutch EU minister said taking depositor money is going to be the template throughout the EU, which should send shivers up the spine of everyone, whether or not they have money on deposit in a bank. When this year began, I was saying that we will a see another Lehman-type collapse in 2013. Cyprus is the tremor, but the real earthquake is not far away." See the King World News interview (CLICK HERE).

◄$$$ STANDARD FARE INCOMPETENT REPORTING IN THE FINANCIAL MEDIA IS PART & PARCEL TO THE PROPAGANDA. ERRORS ARE PLAIN AND EGREGIOUS, BUT NO MATTER SINCE THE PAPER FINANCIAL MARKETS ARE BEING SOLD TO THE SHEEPLE, DEFENDED TO THE END. $$$

The Jackass watches with an eye toward the propaganda and false teachings committed by the financial media. A few stories stuck out. Bloomberg news presented a brief story, claiming that the business capital expenditures (CAPEX) will catch up to job growth which has been on the upswing. Nothing could be further from truth. The jobs data is full of gimmicks like double counting the part-time jobs. Business investment results in job creation, and always leads to economic development that produces jobs. A second deceptive story focused upon the lax Japanese QE monetary policy by the Bank of Japan. The Bloomberg talking toots claimed the stimulus will benefit all the major nations by promoting more trade. That is obviously untrue, since price inflation has befallen the Japanese Economy, while rising costs have hit the exporting companies who hoped to benefit. When all major nations engage in competitive currency devaluations, no nation benefits. Worse, all practicing nations suffer from a rising cost structure and global trade declines. Then another example of reporting propaganda laced with bias. Last week, Bloomberg reported that the Chinese Economy is really struggling with 7.7% GDP growth, with warning signals flashing. Get real! They might be challenged to build domestic demand more broadly, but the nation is entering an industrialization era. Their main challenge is to vomit the USDollar cancer that has infected their economic structure, banking system, and reserves stash.

The USEconomy by contrast is growing 1% to 2% per year in GDP, provided one accepts the 5% to 6% lie on that growth. Translated, the USEconomy has been stuck in a minus 4% to 5% annual recession every single year since 2008, and cannot exit the quicksand to gain any traction. The US stock market is not an indicator of future economic growth, but rather a blemish to display rampant monetary inflation and market control through intervention. The US financial reporting has become a travesty. The financial news networks cannot offer competent reporting, since the policies enacted are almost uniformly destructive. It is hard to know whether the reporters parrot the editorial message while dim-witted on matters economic, or whether they go through the motions of reciting the editorial message even though it is known to be patently false. Probably both. The nation is full of economic stupidity and business folly.

◄$$$ MOMENTUM INDICATES THE ARRIVAL IN A BAD PLACE IS ASSURED FOR THE UNITED STATES. THE MANY PATHWAYS ARE WELL ALONG. REVERSING THE PROCESS WOULD REQUIRE MANY NATIONAL INITIATIVES AND MOST OF ITS RESOURCES, BUT THEY HAVE BEEN CO-OPTED. MORE THIRD WORLD EVIDENCE FOR UNITED STATES. SEXUALLY TRANSMITTED DISEASE PRODUCES NEW CASES FASTER THAN COLLEGE DEGREES ARE ROLLED OFF. $$$

Stopping the momentum of the direction toward decay and Third World conditions, much less reversing it, appears to be totally impossible. The power center is firm and defended by the criminal fascist bankers. Sadly and tragically, it is game over. What remains is defense at the personal level. See the Zero Hedge guest article (CLICK HERE). One of the most insidious and disappointing aspects of this whole mess is the belief that the past does not matter, since the future momentum is so established. Past criminal activities are not pursued, because we are here today. The laws cannot be reversed, because we are here today. Secy State Hillary made this clear a couple months ago during the Benghazi hearings, when cornered on numerous lies. They do not matter, because we are here today. The US Constitution does not matter anymore, because we are here today. Another insidious detail has cropped. up. New data at the Centers for Disease Control & Prevention in Atlanta revealed that one third of Americans have a sexually transmitted disease. The author concluded in stark terms that the nation is producing venereal disease faster than college graduates. The decline into the Third World is occurring at an exponential rate, complete with moral bankruptcy and spread of disease. Next could come pressure for legalized prostitution, since mothers with children struggle to survive. Exactly like in the Third World, even parts of Central America. See the Natural News article (CLICK HERE).

◄$$$ NORTH KOREA ANGLES TO CONSIDER. THE USGOVT NEEDS A DISTRACTION FOR SYSTEMIC BREAKDOWN, WHILE CHINA TESTS THE USGOVT IN MILITARY REACTION. MUCH ADO ABOUT NOTHING. BUT PERHAPS GREAT THEATER. THE JACKASS PREFERS THE MOVIES, BUT NOT THE RECENT FLICKS PRODUCED BY THE USGOVT SECURITY AGENCIES. $$$

For over thirty years of my adult life, the approach has been to ignore every single story about North Korea as nonsense, propaganda, saber rattling, and posturing between the super-giants. So far, a good approach, and nothing missed. Bear in mind that the story is told by the US-controlled press. The North Korean boys are being set up for a possible false flag blame on a staged attack on US soil, plenty of precedent. The NKGovt is staffed by an adolescent mentally deficient pervert. The bust in progress within the United States urgently requires the blame to go elsewhere. The USEconomy implosion must have a distraction so that the US nazi bankers cannot be blamed. With the Iran blame game fading on the vine, NK comes to the fore as an easy patsy which also cannot protect itself well. The public is falling for the NK story easily, since shallow and gullible. Also, the sequestration budget cuts are hurting the defense industry. So they require a reason to negate it under exceptional circumstances in the name of national security. The defense budget must be kept so as to defend against the great menacing NK threat. So shallow and plain!

The other side to consider is that China is toying with the Boyz in WashingtonDC to test the USMilitary response mechanisms. China has long used North Korea as a deviant psychotic bastard child to rattle the US cages as sick sport. Another geopolitical finance motive could be at work also. Beijing could be using NK as a pressure point in order to impose its will on the USGovt, sort of a firm stiff-arm while the USDollar rejection proceeds without interruption. China might be freezing the US while it proceeds with the USDollar isolation through the Eastern channels and BRICS nation sites. The Chinese are testing the US resolve with a pipsqueak rogue nation, with nothing to offer in commodity might like Iran (oil & gas) but with a real nuclear arsenal. The usage of NK by China might be punishment for abusing Iran by the USGovt.

◄$$$ ONE THIRD OF THE WORLD LITHIUM SUPPLY IS UNDER CHINESE CONTROL, HAVING RECENTLY CHANGED OWNERSHIP. THE MARKET FOR DEVICE BATTERIES WILL GO UNDER CHINESE CONTROL. $$$

One third of world lithium supply just went under the control of private hands with ties to the Chinese Govt. The private Chinese firm named Chengdu Tianqi paid $850 million to acquire Talison Lithium, which operates the Greenbushes lithium mine in Australia. The Chinese firm is their chief customer. Talison supplies about 80% of the Chinese lithium market. The China Development Bank provided the financing for the takeover. An American rival named Rockwood Holdings was outbid for the Talison acquisition. See the MineWeb article (CLICK HERE). The consequences of rapid Chinese trade surpluses are vast. The Beijing leaders are cornering several markets.

◄$$$ AN OLD ARTICLE DOCUMENTS THE UNITED NATIONS STUDY ON NEW YORK BANKS AND DRUG MONEY LAUNDERING. THE FLOW IS HUGE. THE DEPENDENCE IS HUGE. THE CRIMINALITY IS HUGE. $$$

The Jackass has frequently made claims that the big US banks are dependent upon narcotics money laundering in constant brisk movement. The United Nations advisor made the argument in late 2009. The source has surfaced again. The details are mindboggling. Drug money has saved the big Western banks during the global crisis. The UN chief for the study on Drugs & Crime stated that $352 billion in criminal proceeds were effectively laundered by financial institutions. See the UK Guardian article (CLICK HERE) from 2009.

◄$$$ GAZPROM IS FORMING A NATGAS CARTEL TO BE EQUIVALENT IN POWER TO O.P.E.C. DOMINATED BY THE ARABS. THE CYPRUS GAS FIELDS WILL PROVE TO BE THE SITE OF A MAJOR STRUGGLE THAT WILL TIP THE BALANCE TOWARD ASIA. NOTICE HOW QATAR TRUMPS THE SAUDIS ON THE PETRO-DOLLAR TABLE. THE NATGAS CARTEL WILL DISRUPT THE PETRO-DOLLAR UNITY AND PROBABLY WRECK IT. SYRIA IS AT THE CENTER OF A NASTY BATTLE FOR NATGAS PIPELINE DELIVERY, A BATTLE BETWEEN SHIITES AND SUNNIS NOT REPORTED. $$$

Russian President Vladimir Putin is a no-nonsense lion. He is angry and motivated. He will be pushing the giant energy firms under his wing to form an energy cartel. The most evident consortium that seems to be emerging is the natural gas cartel led by Gazprom, which includes a growing list of nations and important projects. In the process, he is working an end-around maneuver of Saudi Arabia itself. Enter the Mediterranean Gas Wars, the ringleader for which is Gazprom. Watch as the Saudis are pushed to the margin on the geopolitical stage, and their all-important Petro-Dollar fades into obscurity. The death of the USDollar might be a secondary objective.

William Engdahl has been a leading analyst on the energy wars for a decade. He believes the Cyprus events obscured the battle waged behind the scenes for control of the expanding European natural gas market. It is a high pitched battle. The strategy used by Gazprom and the Kremlin might be to unseat the USDollar by capturing natural gas and rendering the Saudis as bystanders. The bizarre conflict over Cyprus and even Syria could be central to the new gas wars and geopolitical chess. Putin is a master chess player. As background, note that in December 2011, Noble Energy discovered a field offshore Cyprus estimated to hold at least seven trillion cubic feet of natural gas. The same Noble Energy found huge gas reserves off the Israeli shore in 2010, giving the nation some measure of energy independence. But the plot thickens.

Syria is in the way, both as a political host of a tyrant and as an obstacle for the development of Qatar's natgas business. The West seems painfully unaware, but the Saudis and Qataris are major backers to bring down the Assad regime in Syria, for Shiite sectarian reasons and for their vested interest related to natgas. Qatar has bid to become a major LNG gas exporter. Its North Field is contiguous to the South Pars gas field owned by Iran in the middle of the Persian Gulf. On political grounds, Qatar is backed by Turkey against the Assad regime in Syrian. As footnote, a petard was hoisted against the Saudis for their role, the assassination of Saudi Prince Bandar by HezBollah in August. The Persian Gulf Arabs (the moderates) wants Assad off the map, in Engdahl's words. The chaos in Syria might see the tyrant swept away, maybe to a tomb. A key event took place in July 2011, when Syria, Iran, and Iraq signed a $10 billion agreement for a pipeline from Port Assalouyeh in Iran en route to Damascus in Syria through Iraq. Iran plans to extend the pipeline from Damascus to a seaport in Lebanon where it can deliver natgas to EU markets. Some new competition has complicated the picture. In August 2011, a discovery was made by Syrian exploration firms of a huge new gas field near the their southern border with Lebanon. According to informed Algerian sources, the new Syrian gas discoveries are believed to be of equal magnitude as in Qatar. That means very big.

The military angle is simple. The US and British Militaries prefer the moderate Arabs and thus support the anti-Shiite Muslim Brotherhood. The Syrians are Shiitte and aggressive, hosting the HezBollah, in my opinion the most fearsome Islamic militant group on the planet. The pipeline from Iran has the risk of become a prized Shiitte gem asset, a major poker chip. The Iran-Iraq-Syria gas pipeline to supply Europe would be a defacto Shiite pipeline from Shiite Iran via Iraq (with Shiite majority) onto Shiite stronghold Alawite Syria. Naturally, Qatar backs an anti-Shiite Muslim Brotherhood solution for a new reshaped Syria. The emirate nation of Qatar is dominated by Sunnis, as is Saudi Arabia. This entire sectarian conflict is never reported in the US press, nor is the killing of Prince Bandar. The Qataris host both the USMilitary and various US universities, including a branch campus for Carnegie Mellon University (my alma mater), for which the Jackass was once asked to apply for a teaching post. Given my distaste for extreme nasty heat, crossfires of violent radical groups, and absent women in bikinis on the beach, a decline was given.

Russia has found itself in a very precarious awkward position. The Kremlin has been a steady supporter of the Assad regime, not because of their beneficence but instead due to desire to defend Russian naval rights at the strategic Syrian port of Tartus. Russia has provided the Assad thugs with missiles. In the last month, Russia has done the unthinkable, when it signed a deal with Israel. The Tamar floating gas platform will direct its natgas output to Gazprom. The geopolitical energy business is multi-lateral in nature. The Tamar field will begin to produce natgas in 2013, with some devoted for export. Recall Noble Energy in late 2010 also discovered an enormous natural gas field offshore to Israel in the Levantine Basin. The Tamar deal with Russian Gazprom complicates the energy war and the Syrian map.

Gazprom has reportedly during the banking crisis offered Cyprus to develop its gas fields, but it demanded a stake. For its part, Cyprus urgently requires a strong partner to develop its newfound gas wealth, to offset its banking losses. They must enlist a strong partner like Russia, in order to confront Turkey, which claims rights over Turkish Cyprus waters. However, Gazprom holds heavy leverage over Turkey, as supplier of 40% of Turkish gas for its industry. Moscow and Gazprom will emerge the net winner from these hidden Mediterranean gas wars. See the excellent RT News article (CLICK HERE). Putin will take Cyprus and Israel and Iran under his wing to form the gas cartel. The United States will fade into the background. The future will tell whether Qatar will cooperate and work toward compromise with Syria. Dangerous times ahead!

## CYPRUS STENCH & TAX TEMPLATE

◄$$$ THE CYPRUS EVENT IS A FLASH POINT EVENT. THE TIPPING POINT REMAINS IN PROGRESS, WITH BANK RUNS AND DEEP INSOLVENCY THE RISK. CONFIDENCE IN BANKS IS FAST ERODING. WITHOUT IT, THE PEOPLE WILL STORE IN THEM ONLY THE BARE MINIMUM FOR FUNCTIONAL USAGE. $$$

Deep damage was done with the Cyprus bank haircuts, the unilateral tax levied on private accounts by the vile EU commisars. The effect on bank usage and perception of safety is clear and palpable, not to mention irreversible. Insiders moved EUR billions out of Cyprus banks before the bank holiday and after the banks closed, via branches in London and Russia. Confiscation of the depositor funds is planned for future European bank failures. Also, Canada, the United States, the United Kingdom, and New Zealand have similar plans on public record. Confidence in the safety of banks has been drastically reduced. People are awakening to changes in the bank accounting practices, with deep vulnerability. Money in banks is not safe, since easily confiscated, just electronic bits easily altered overnight. On the upper level, the Bank of Japan has deployed a highly aggressive money printing strategy that is assured to end badly. It will cause great stress in the upper levels of the bond and currency markets.

Paul Craig Roberts believes firmly that the tipping point has been passed. My quibble is with the term tipping point. More accurately a flash point has occurred. Roberts implies that the flash point has been followed by something more pervasive. He believes the world is moving fast away from the USDollar in trade usage, which combined with heavy monetary expansion has created a tipping point. He might be exactly right. He refers to a tipping point in the system that requires confirmation by a tipping point event at the ground level. Roberts pointed out that desperation, bank fears, dollar weakness, a banking catastrophe, accounting fraud, panic, derivatives, and greed make for a list of items to fill the background, certain to push the corrosive process into overdrive.

Roberts wrote, "The fact that the Federal Reserve is short selling bullion means that there is something desperate going on. I assume it is related to the USDollar. If the dollar drops sharply in exchange value, the Fed cannot control the interest rate and the bond price, and so all of the bubbles would blow up. All of the recent reports of countries moving away from the dollar to settle their international payments have most likely caused a great many countries to look at getting out of dollars. We not only have the BRICs moving away from the use of the dollar, but also China, Japan, and all of the East Asians. Recently we have even seen reports out of Australia that they are going to deal directly with China in their own currency. So this drop in demand for dollars when the Fed is creating one trillion new dollars every year means the exchange value of the US dollar is untenable." Full agreement by the Jackass. He makes the case for an unstable condition for the USDollar with respect to Gold. See the Gold Seek article by GE Christenson, aka Deviant Investor (CLICK HERE and HERE).

◄$$$ THE BANK OF CYPRUS WAS VOTED BEST BANK FOR PRIVATE BANKING IN 2012. SAVERS BEAR THE BRUNT OF BANK REFORM IN CYPRUS. IN CYPRUS EVEN THE DEPOSITORS IN THE GOOD BANK FACE ALMOST A TOTAL WIPE-OUT. CYPRUS LEADERS AND POLITICIANS REMOVED THEIR MONEY SAFELY FROM THE BANKS IN PLENTY OF TIME. THE ELITE TAKE CARE OF THEIR OWN. $$$

The respected EuroMoney magazine rated the Bank of Cyprus #1 in 2012 for private banking. The hypocrisy is loud. They eclipsed the European banks as the offshore safe haven, offering a higher interest rate yield to savers. Such deception to target them for deep bank liabilities to the northern masterdom. Cyprus was a stern competitor, a safe haven, and a Russian enclave, but no more. See the Ritholtz article (CLICK HERE). The lesson from Cyprus is that savers and not the secured bond holders were targeted to bear the brunt in bank reform and resolution. Depositor anger is acute with widespread feelings of betrayal. Hidden motive abounds. See the Reuters article (CLICK HERE). The situation is so upside down that the depositors in the so-called Good Bank face a near total confiscation loss. See the Zero Hedge article (CLICK HERE). Grand loss was spared the leaders, the parliament members, and the wealthy connected from the island nation. The elite had their loans forgiven, while removing their personal funds in arranged open back doors. The 99% public were thrown under the bus in callous manner, the same old same old. The political fallout continues. See the Zero Hedge article (CLICK HERE). Russian President Putin announced a restructure of the EUR 2.5 billion Cyprus debt, a small but important symbol in aid. See the RT News article (CLICK HERE).

◄$$$ CYPRUS WAS UNIQUE, AN ANOMALY WITH OUTSIZED RISK THAT PERHAPS HAD TO BE ELIMINATED. ITS BANK ASSETS WERE SEVEN TIMES THE ECONOMIC SIZE. IT OFFERED SAFE HAVEN AND HIGHER INTEREST YIELD. OBSERVE THE MOTIVE TO WRECK IT. $$$

Cyprus grew out of control in size and risk deployed. Its banking sector was permitted to grow to seven times the native economy size, but with low levels of equity and high risk assets. The EU bank stress tests recently conducted were frauds once more. Bank assets swelled in value to EUR 126.4 billion at the end of January, from EUR 78 billion in 2007 when the island nation enclave adopted the Euro currency. The Spanish banking assets total just over three times the size of its native GDP. In Cyprus, the banks offered 4.5% on deposits, compared with 1.5% in Germany for instance. The place was a magnet for money, much to the displeasure of the EU commisars.

◄$$$ CONFUSION SPREAD AMONG EUROPEAN COMMISSIONERS, AS CHAIRMAN OF THE CYPRUS BAILOUT OF MEETINGS DENIED THE ISLAND BANK BAILOUT WAS THE TEMPLATE FOR FUTURE BAILOUTS TO BE APPLIED TO SOUTHER EUROPEAN NATIONS. MUCH CONFUSION OVER THE DENIAL. MANY BELIEVE LUXEMBOURG IS NEXT FOR A BANK TAX. $$$

The Cyprus deal will serve as a template for future bank restructurings in the EuroZone. The bank officials call it a request for aid to recapitalize, yet no option to decline will be given. The political charade became as clumsy as it was revealing. The Dutch Finance Minister and Eurogroup chairman Jeroen Dijsselbloem chaired the meeting on Cyprus. He apparently wished to use the implausible deniability veil of deceit. He directed the plan executed upon Cyprus. The template was revealed but finally denied by the Euro Central Bank due to political fallout and perhaps fear of public reprisal. Hours after the Cyprus deal was struck, Dijsselbloem informed the public, for at least those paying attention and not fast asleep, that in the event of a serous risk to a bank, the shareholders and the bondholders will be required to contribute toward the recapitalization of the bank, and if necessary the uninsured deposit holders.

In the process of public theater of the absurd, the bankers revealed which country is next to be whacked on private accounts; it is Luxembourg next as target. That country is Luxembourg, whose foreign minister Jean Asselborn went public about German criticism. He said, "Germany does not have the right to decide on the business model for other countries in the EU. It must not be the case that under the cover of financially technical issues, other countries are choked." Note that Luxembourg is strikingly similar to Cyprus. They have a large financial sector, a lenient tax structure, and a lot of foreign money inflows. Their public criticism against the ubermeisters in Berlin is not permitted. See the Zero Hedge article (CLICK HERE) and the Business Insider article (CLICK HERE).

◄$$$ THE EASTERN ORTHODOX CATHOLIC CHURCH LOST EUR 100 MILLION IN CYPRUS. THE EASTERN CATHOLIC CHURCH HAS RUSSIAN TIES. $$$

The European Union abused the power of the Euro Central Bank and Intl Monetary Fund. They wrecked the formerly independent island of Cyprus. But in so doing, they  seized the assets of the Eastern (Greek) Orthodox Church. The untold trait of the Euro bankers is their atheistic and marxist leanings. They might have fantasized about seizing renegade bank assets for over a decade. The Vatican should be extremely nervous about their massive Italian and Spanish property holdings in nations which could be next on the confiscation block. The other (Eastern) Catholic Church stands to lose more than EUR 100 million in the bailout deal reached in brutal style. Its leader Archbishop Chrysostomos expressed alarm openly, and spoke of lost jobs and multiplied hungry. See the John Galt article (CLICK HERE). Rome and the Vatican have connections to Western central banks and the associated security agencies. The Eastern Orthodox Church has connections to the Russian central bank and the ex-KGB forces. It is sometimes called the Russian Orthodox Church. Be on the lookout for some old fashioned Russian vengeance, which has always looked different from the Sicilian mafia revenge exacted.

◄$$$ THE CYPRUS EVENTS BENEFIT RUSSIA. THE PRIZE REMAINS EUROPE. THE OLD GUARD RESIST THE EASTERN WINDS. MANY RUSSIAN ACCOUNTS WERE SPARED, AND RUSSIAN BANKS WERE UNTOUCHED. MONEY WILL RETURN TO RUSSIA. GAZPROM WILL WAIT FOR THE RIGHT CONDITIONS TO POUNCE, AS CONDITIONS INSIDE CYPRUS WILL SURELY DETERIORATE. $$$

Despite the outrage from lost Russian accounts in Cypriot bank accounts, the crisis ultimately will help Russia. The Western news stories are full of erroneous information. The pounce by the EU commisars was partly motivated to halt the Russian encroachment, not in banking as much as energy trade. Close to 60% of Russian exports, primarily oil & gas, are directed to the European Union nations plus Switzerland. Russians do have billions of Euros deposited in Cyprus banks, and the imposed tax on large depositors affected many Russians. But Moscow is adversely affected due to its own outdated business practices. Most foreign direct investment (FDI) does not com e to Russia from the heart of the European Union, but rather from offshore areas like Cyprus, the British Virgin Islands, and Bermuda. By contrast, Germany accounted for only 4% of FDI in Russia. The dirty Russian money in Cyprus banks is an overblown rag story, an easy topic for the distorted Western press. However, the bulk of the exiting cash flowing out over the years was motivated so that Russian investors could protect their money from possible litigation in Russian courts, which are primitive tools of the Kremlin.

Paradoxically, the diverse problems in Europe benefit Russia. Some money hidden offshore funds might be forced to come home. Russia is rising in prominence, while Europe is faltering. They have built exit plans. The wealthy Russians have been buying up European real estate, including some kitchi London areas. Over three million Russians have European Union residency permits. The Russian Govt considered bailing out Cyprus. But the Kremlin quickly realized that a complete rescue could ultimately cost $26 billion to $51 billion to cover depositor withdrawals and to recapitalize the full banking system. Moreover, they understood that wresting control over the Cyprus financial system would give Russia no significant voice in the EuroZone. Instead, Russia has a perspective focused upon the energy trade. In the balance is Gazprom, which seeks exploration rights for offshore gas fields around the island nation. The oil fields are in waters claimed by Turkey. They will bide time, and make their move when the current situation worsens much more. No doubt it will deteriorate.

The benefits to Moscow came in three ways. 1) The Russian commercial bank VTB in Cyprus was not forced to seize any client accounts. Hence it might emerge from the crisis as the island's strongest and most trusted financial institution. 2) While the Russian Govt decided not to help Russian private account holders, it declared that Russian businesses incorporated on Cyprus could receive financial support from VEB, a Russian state owned bank. 3) Lastly, several Russian oligarchs like Alexei Mordashov, Andrei Akimov, and Yuri Kovalchuk were adequately warned. They withdrew their funds in early March. The movement within Moscow to bail out Cyprus had lost many potential supporters. Any costly rescue initiative would have been too much for Russia, in view of a growing deficit and upcoming demands for the 2014 Winter Olympics venues.

The drawbacks are evident. Still a sizeable amount of Russian money is located in Cyprus banks. Although the Russian Economy could face a 1% hit to its GDP, the imported crisis will surely aggravate other problems for Russia's private sector. The absent rule of law in Russia had induced many businesses to store their money abroad, like in Cyprus banks. The tactic falls short, and much money is returning where it will face taxes and other impositions. Several havens like Iceland, Latvia, and Cyprus are no longer considered financially safe. The Kremlin has its own unpopular tax programs, designed to impose levies on the diverse underground market for which Russia is famous. The new tax hikes are aimed at mid-sized businesses. Incredibly over 300 thousand small businesses have closed since the start of this year, as the Kremlin has introduced new laws that paralyze independent non-governmental organizations. If a larger segment of the Russian business community were to demand better governance, more democracy, and an effective court system, it might cause instigate a true challenge for the current Kremlin regime. See the New York Times article (CLICK HERE).

◄$$$ THE RUSSIANS MIGHT SEEK THE NAVAL PORT IN CYPRUS FOR USAGE BY THE PESKY RUSSIAN FLEET. NATURAL GAS FIELDS AND THE PORT HAVE ADDED SOME SPICE TO THE HIGH JINKS CONFLICT AND THE TABLE OF WAR. $$$

Appeals to Russia by Cyprus for aid have been made. The Kremlin might wish to be handed the important naval port in exchange for a bailout. The Ekathimerini report gave an update on the status of negotiations between the two countries. The Russians will demand some extraordinary form of compensation. A naval port in Cyprus for the Russian fleet is a trump card. Access to the offshore natural gas reserves would be a full house in the emerging poker match. The Cyprus game might have a very hidden important energy angle in addition to the Russian banking angle. Cyprus is near Turkey, not the central area of the Mediterranean Sea, offering a strategic eastern outlet for the historically landlocked Russia. The Great Bear nation has for centuries lusted after port access. See the Business Insider article (CLICK HERE).

## BANK SEIZURES UNDER GUISE OF RESTRUCTURE

◄$$$ USGOVT BANK LAWS HAVE RADICALLY CHANGED, WITH ALMOST NO AWARENESS BY THE AMERICAN PUBLIC. NO MORE DEPOSIT INSURANCE EXISTS IN THE UNITED STATES OR ENGLAND, JUST CONVERSION TO WORTHLESS STOCK AND ORDERLY LIQUIDATION. US-BANK DEPOSITS WILL NOT BE INSURED AND ARE SUBJECT TO CYPRUS TYPE INTERVENTION PER NEW F.D.I.C. ORDERLY LIQUIDATION AUTHORITY (OLA). NICE WORDS FOR BANK ACCOUNT TAX BY FORCE. FIRST COME THE BANK RESTRUCTURINGS, THEN THE USTREASURY BOND RETURN TO ISSUER, THEN THE USDOLLAR ISOLATION, FINALLY THE BIG USDOLLAR DEVALUATION. $$$

The new zipwords will be Bail-in and Orderly Liquidation, which make legal and present as sophisticated the private bank account thefts that come, as soon as the next quantum step in decline occurs within the United States and United Kingdom. Last December 2012, an important directive on vicious bank restructure was signed into law, done unilaterally by the central banks, without public knowledge or approval. The objective is to maintain financial stability. The method is private account taxes, otherwise called confiscations. The FDIC-BOE document is entitled "Resolving Globally Active, Systemically Important, Financial Institutions" and can be found on the USGovt website (CLICK HERE).

The bank cartel directive dovetails in a lovely mesh with Title II of the Dodd-Frank Act, which provides the FDIC with new powers to resolve SIFI firms (systemically important, financial institutions) by establishing the orderly liquidation authority (OLA).  The bank officials has set the rules by which they will seize private accounts as they see fit, by whatever criterion they want. They will save the wealthy funds, and grab the common people's funds, without any doubt. The motive for the draconian collectivist Stalin-like seizures by the FDIC and Bank of England is to manage the next stage of financial collapse, expected to be on a truly grand scale, much larger than either the taxpayers or Congress is willing to underwrite. The process calls for some depositor accounts to be converted into bank firm stock, thus enhancing equity ratios. But the stock will be worthless, since the firms will remain deeply insolvent. In the United States, the new equity would become capital in newly formed operating entities. A new class of creditors would become the owners of the resolved firm. No exceptions are indicated for insured deposits in the US, as the FDIC has been completely transformed. Not 1% of the population is aware in my opinion. The deposits under $250,000 formerly protected by FDIC insurance are not exempted. All are subject. See the Silver Doctors article (CLICK HERE).

The insidious nature of the bank accounting must be detailed. Legally the bank owns any depositor funds as soon as they are put in the bank. The funds become bank assets, and the individual becomes unsecured creditors. The bank will dole out the money upon demand, unless it goes bust. Under the FDIC-BOE plan, the people's accounts can be converted into bank equity, and not delivered in cash upon demand, in the event of a decision to restructure amidst threat of failure. The people who used to keep a deposit account for ready cash to pay the bills are in for a shock. In both the US and UK, the newly converted equity would become capital in the newly formed operating entities, perhaps even under the same name so as not to alarm the intellectually dormant and mentally inept. They will be the new zombie firm equity shareholders. Some confusion remains on the British insured deposits, which will surely be subjected to future modifications that permit seizures. Former bank accounts once protected by FDIC will run risk of wipeout, just like Lehman Brothers and Fannie Mae and AIG shareholders. Past lessons are clear.

In the US, depositors have actually been put in a worse position than Cyprus deposit holders, especially when their banks have played in the derivatives arena. The banks have been using their depositor funds to manage derivatives exposures, with implicit regulatory approval, the depositors subordinated, not separate. The unsecured creditors from previous depositor rank & file are in line to receive what the Lehman Brothers investors received, about eight cents on the dollar. The MF-Global account holders received zero. The 2005 bankruptcy reforms made the counter-parties to derivative contracts senior to unsecured lenders. The reform was a vicious attempt to impoverish the nation by stripping the people of wealth. The irony is sickening. The actual posting of partial collateral (like 2% or 5% or 10%) by a derivative counter-party makes the creditor Secured, while the depositor who puts up 100 cents on the dollar is deemed Unsecured. Therein lies the duplicity and vicious motive to strip the nation of its wealth, in preparation for a debt slave police state when poverty prevails by dictum.

What comes is far worse than a tax. An FDIC confiscation of deposits to recapitalize the banks is far different from a simple tax on taxpayers to pay government expenses. Taking depositor funds is simply theft. Deposit insurance has failed, as the FDIC is a captured entity by the bank syndicate. Trust required to make the banking system work is in the process of full collapse. Most people remain ignorant, and will remain ignorant until they lose their bank accounts. The Cyprus style template to be imposed on the US will amount to a tax on the middle class, gutted by the housing bust. They will become vassals in the new state. See the Truth Dig article by Ellen Brown, chairman of the Public Banking Institute (CLICK HERE).

◄$$$ CANADA HAS INCLUDED THE DEPOSITOR HAIRCUT BAIL-IN PROVISION FOR SYSTEMICALLY IMPORTANT BANKS IN THE 2013 BUDGET. IRISH BANKS ARE ON THE VERGE OF PULLING A CYPRUS TAX ON ACCOUNTS. $$$

Titled Economic Action Plan 2013 and tabled in the House of Commons by Minster of Finance James Flaherty on March 21st, the official 2013 Canadian budget contains an explicit provision that Canada will pursue the Bail-in model for systemically important banks used in future bank failures. Depositor haircuts will occur in Canada, which is no different from the United States in central bank activity, big bank vulnerability to toxic bonds, and lies about its gold reserves. The insidious language to the plan is plain. The usage of depositor funds is central to the plan to restructure the systemically important financial institutions. Like with the US plan, the big banks that find themselves depleted of capital can seize deposit funds, convert them to stock shares, and continue as hollowed insolvent firms. They were insolvent even after using depositor funds in equity ratios. However, that newly designed capital will vaporize in the following months, for the simple reason that no solution would be ordered. The zombie banks will remain zombie banks. The only difference is the transformation of private individual accounts into zombie entities. Confiscating wealth from depositors will not reduce risks for taxpayers, since their private accounts will be gone, replaced by worthless paper. See the Budget GC article (CLICK HERE). Only people with assets held in physical Gold & Silver will survive the storm. See the Boom Bust Blog by Reggie Middleton for information on the global banking crisis, and imminent plans to be imposed on Irish bank account holders (CLICK HERE).

◄$$$ THE SWISS HAVE JUST JOINED THE BAIL-IN CROWD FOR BANK CONFISCATIONS. THEIR BANK REGULATOR HAS REVISED THE 1934 BANKING ACT TO ALLOW BAIL-IN DEPOSIT CONFISCATIONS. TRULY GIGANTIC ACCOUNTS LIE IN SWITZERLAND THAT DWARF CYPRUS. A GRAND CLIMAX EVENT IS COMING. $$$

On Friday, the Swiss Financial Market Supervisory Authority (FINMA) has quietly joined the growing parade of Western nations who have amended banking laws to allow depositor bail-ins upon the next banking crisis. The event stage is set. The leading Western nations seem in unison in bank confiscation plans. The curious part is that the depositor funds are nowhere adequate to address a fraction of the insolvency problem. My firm belief is that the laws are being re-written ex-post facto to cover past confiscation evident within their accounting, as in past criminal violations covered up. The big banks improperly used the depositor funds in their ratio calculations, and probably usurped the funds altogether as a regular practice years ago, like since 2008. Switzerland, once the ultimate safe haven for banking deposits across the world, the land of yodels is preparing to confiscate (steal) depositors funds. Their bank accounts could be the largest in the world, along with some in London. No protection is afforded anywhere other than physical Gold & Silver in your own possession, and the locations for gold vault security really can be counted on the fingers of one hand. They are Hong Kong, Dubai, and possibly Singapore. Eventually add Russia to the list of secure vault locations. See the Silver Doctors article (CLICK HERE).

◄$$$ JIM ROGERS BELIEVES BANKS ARE GOING TO BE LOOTED EVERYWHERE, UNDER THE GUIDING HAND OF THE INTL MONETARY FUND. POVERTY AWAITS. WHAT REMAINS IS THE TRIGGER EVENT FOR OFFERING THE THIEVES PROPER COVER. EXPECT A CASCADE OF WORLDWIDE CONTROLS DUE TO CYPRUS EXAMPLE, FOLLOWING THE BIG IMPORTANT SEQUENCE OF DAMAGING BANK RUNS. $$$

Self-styled Jim Rogers was on CNBC in late March. He had a dire warning. He said, "If politicians say do not worry, then understand you have to worry and they will loot your bank account. Run for the hills and hurry to get your money out." He went on to describe how the IMF condones stealing people's money. He warned that trusting the politicians will result in a quick bankruptcy. Amazingly the CNBC reporter agreed with him on the threat and need to remove money from the banks. Rogers was plain when he stated his expectation that private bank accounts will be looted everywhere. See the Sherrie Questioning All video (CLICK HERE).

The warnings have been given by both USFed Chairman Bernanke and Fed Governor Jeremy Stein. The inevitable event of a failed Systemically Important Financial Institution (SIFI) will result in possibly total loss of deposit accounts, not just tax haircuts. Stein was clear. See the Zero Hedge article (CLICK HERE). The part that remains unclear and still part of the mystery is the fate of private bank accounts in small and medium-sized banks, even some larger regional banks. If a string of Wall Street bank failures occurs, then time will tell if the contagion will spread to the other thousands of banks. My conjecture is the contagion will indeed spread, but to a minor extent, not to a wide extent. Some regional banks will be affected, die, and confiscate funds, since they contain rancid toxic derivatives without investor knowledge.

Foreign depositors in European banks will not accept that Cyprus was a one of a kind event. The bank runs have begun, yet not in heavy volume. Expect foreign corporations including European corporations to soon begin pulling funds out of the European banks. They will seek safety elsewhere, perhaps in Gold. They will deploy plans to minimize the amount of cash on hand in Europe by shifting to non-European banks and making transfers as needed. Those withdrawals, when they occur in accelerated fashion, will eventually create a massive liquidity crisis in Europe. The reasonable financial steward to corporations will assume that the risk in Europe has risen, which warrants different strategies for managing institutional deposits. In Europe, depositing money in a bank is no longer considered the automatic no-brainer option. See the Stratfor article (CLICK HERE).

◄$$$ STEPHEN LOEB BELIEVES THE WESTERN FINANCIAL STRUCTURE IS CLOSE TO COLLAPSE. HE EXPECTS POWERFUL MOVES IN THE GOLD PRICE WELL BEYOND THE $2000 MARK. $$$

Popular analyst Stephen Loeb called the current crisis a raging war on Gold, as the West moves much closer to collapse. Gold is being sold in futures contracts (naked sales, fully illicit) to mask the desperate situation the West faces going forward. He anticipates a powerfully significant short squeeze the world has ever seen in the Gold market. The trigger event in his opinion could be China suddenly announcing their gold accumulation project is sufficient to the partial backing of the Yuan currency by gold. He pointed out that Turkey is importing increased amounts of gold, to facilitate in trade settlement. He expects a growing list of countries outside of the EuroZone to import much more Gold bullion. For the Western central banks to control the Gold price is essential, in order to remove the sentinel warning signal that the financial system is near collapse.

Eastern nations are preventing any further decline in the Gold price, as nations led by China and India hold on and maintain their buying pattern. They hold firm the physical gold metal price, not to be confused with the gimmicked paper gold price posted by the COMEX. They see the picture from a much broader perspective, for its systemic failure. The barometer for what is wrong with the world is under heavy handed control, in his opinion. Loeb believes a Gold price up to $1800 or $1900 is nothing compared to what comes. See the King World News interview (CLICK HERE). Before the Loeb scenario can play out, the smashdown in the paper gold market was permitted. The short squeeze is yet to come, later on, when the Boyz are done playing their weak hand. Once played, a card cannot be played again.

◄$$$ BERNARD MADOFF HAS BEGUN TO SING. SINCE NOT KILLED IN PRISON, HE HAS STARTED TO NAME NAMES AND OFFER DETAILS ON SCUMMY BANK OPERATIONS. THE CENTRAL SYNDICATE BANK OF JPMORGAN CHASE IS UNDER STEADY CRIMINAL INVESTIGATIONS, BUT THE RISK TO COME IS SIMPLY MORE FINES. WITNESS THE TWILIGHT OF JUSTICE, AS BIG US BANKS ARE UNDERSTOOD TO HAVE FULL IMPUNITY. THE ELITE CONTROL THE SYSTEM BY HOLDING COMMAND OVER THE REGULATORS AND RULING BODIES THAT MAKE THE RULES. $$$

The background was set up with the Bank of Japan completely engulfed in illegal cross-collateralized derivatives tied to Deutsche Bank and JPMorgan Chase. They are neck deep in naked short positions tied to the Japanese Yen. Additional strictures have compounded the big bank stress, when engaged in such illicit typical steady behavior. The BOJ has imposed new limits on the cash Yen available in the Japanese treasury to continue any more bond monetization purchases. They are printed money devoted to bond purchase that nobody wants, but serve a purpose of pulling the Yen exchange rate down. Enter convicted ponzi scheme architect Bernard Madoff. He is now singing like a canary in a secret federal grand jury in New York state. Madoff has pointed the finger of blame squarely at JPMorgan Chase, at Bank of America, and at Citibank in the United States, at Deutsche Bank and at Commerzbank in Germany, and at Barclays Bank of England. He has accused these giant banks to be full co-conspirators in Madoff ponzi scheme that has become directly linked to the illegal rigging of the London LIBOR rate.

Meanwhile, back on the financial sector farm, JPMorgan Chase faces growing pressure from a string of federal investigations. Do not expect the queries to result in much more than a puff of bad wind and some tiny fines. Banker corruption has been successfully converted into manageable and even insignificant costs. Most prosecutors and courts are firmly under control by the banking syndicate. See the New York Times article (CLICK HERE). A ripe list of 28 major banks is considered above the law. That includes their senior executives and board members. Regarding any financial and professional actions, the individuals are above the law. Breaking the law is profitable under the Fascist Business Model. No person has an interest to say no. The shareholders and executive staff, even lower level staff, directly benefit from breaking the law. They will profit by participating in illegal activity, blessed as permissible by the USGovt if the bank is large enough and systemically important. Worse, they will have a vested interest to ensure it continues.

These 28 banks are worth approximately $42 trillion. In the United Kingdom, 40% of the wealth is held by the top 10%. In the United States, the top 10% hold between 81% and 94% of all the wealth in a much more severe distortion of wealth. The US middle class has been decimated in the last 20 years. The majority of the money in those top banks are made available for use in illegal but lucrative schemes, managed by the wealthiest 10%. The very people who run the banks sit on important regulatory boards, influence important Congressional and Parliamentary committees, have friends in high ministerial offices, and thus make the rules. See the GolemXIV article (CLICK HERE).

◄$$$ VENGEANCE WILL ARRIVE. THE RUSSIAN BANKS HAVE BEEN MUSCLING OUT EUROPEAN BANKS. RUSSIA PLANS TO BAN CASH TRANSACTIONS OVER $10 THOUSAND. THE TITAN US-BANKS STILL HANG ON IN RUSSIA, BUT NOT FOR MUCH LONGER. $$$

Russian investment banks controlled by the Kremlin are squeezing out foreign competitors. The post-Lehman problems have helped the process. The Russian giant bank VTB Group has seen investment banking fee income grow more than five-fold since 2005. The Western banks have fared badly. European financial institutions including UBS, Deutsche Bank, and Royal Bank of Scotland lost almost half their market share during the last seven years. Putin has steadily aided domestic allies who own their strategic businesses such as aluminum producer United Rusal, and the steelmaker Evraz. The large Sberbank and VTB have used their position to leverage follow-up business. Russian banks won 38% of fees in 2012, up from a mere 7% in 2005. The share of European firms shrank to 32% from 61% over the same period. The share for US banks fell to 20% from 27%, but expect their fat share to fall fast.

Foreign investment banks widely face regulatory demands to boost capital at home. So they are quitting or scaling back in Russian offices. The Dutch firm ING Groep and Italian firm UniCredit will shut down securities businesses soon. The Credit Suisse Group moved part of its investment banking business to London from Moscow. Filling the void are GazpromBank, OAO Sberbank, VTB (formerly known as Vneshtorgbank), and Vnesheconombank (the state development bank often called VEB). Sberbank and VTB are expanding in IPO stock offerings and merger acquisitions. Julian Rimmer is a trader of Russian equities at CF Global Trading in London. He expects the hold foreign banks maintained over bigger deals could eventually disappear. He said, "In high profile IPOs, corporates still want the expertise of Goldman Sachs and JPMorgan, but this dependence will gradually diminish as Sberbank and VTB expand their investment banking reach." See the Bloomberg article (CLICK HERE). The new Kremlin ban on cash transactions over $10,000 will surely interrupt any defense by the US firms. See the RBTH article (CLICK HERE).

## BRICS FUND DAWN

◄$$$ COVERAGE BY WESTERN PRESS OF THE B.R.I.C.S. DEVELOPMENT FUND HAS MISSED THE MAIN THRUST. THEY FOCUS ON AFRICAN RAILROADS AND NOT THE NEXT STEP OF GOLD TRADE FINANCE. IT WILL HAVE A DUAL ROLE FOR CONSTRUCTION PROJECTS BUT THE FAR MORE IMPORTANT ROLE IN FINANCE TERMS WILL BE ITS GOLD TRADE CENTRAL BANK ROLE. THE EMERGING MARKET NATIONS WILL CONVERT TRADE SURPLUS STORED AS USTBOND BANK RESERVES INTO GOLD BULLION. IT WILL BE HIDDEN AND DONE QUIETLY, SO AS NOT TO BE ATTACKED BY THE US-UK GOON SQUAD SECURITY FORCE TERRORISTS. TRADE SETTLEMENT WILL SOON BE DONE IN GOLD TRADE FINANCE. $$$

The distraction story centers upon the corrupt bias by the Intl Monetary Fund and World Bank, which favor the Western nations with sweet terms that enable confiscations. History is loaded with examples. The other part of the story used for distracted emphasis is the BRICS Development Fund devotion for construction projects. The connection by railway between Durban South Africa and Tanzania receives a lot of press attention. Let them be diverted, since in the background elaborate plans are coming into realized form for creation of a gold trade central bank, seeded with USTBonds. The BRICS nations are sick of holding toxic USTBonds in their banking system, since the USFed debases their value, while the USGovt adds to supply with gargantuan annual deficits. Neither the central bank nor the federal government is resolving their outsized chronic severe problem. Systemic failure awaits the US as a nation. Leaders of the five BRICS nations plan to create a development bank and to seed it with $50 billion shared equally between Brazil, Russia, India, China, and South Africa. Agreements have been struck. Expect the biggest share to be provided by China, which owns over $1000 billion in toxic USTBonds. The fund's creation would chart a more equitable world economic order, built upon non-USDollar trade.

At the seminal meeting, Russian President Putin gave support for the bank but cautioned it must work on market principles. The Indian trade minister expects the BRICS consortium to have a defining influence on the global order of this century. The five nations make up 20% of global GDP but boast most of its growth. The two biggest economies of the group, China and Brazil, affirmed their dedication to change the world's trade and financial architecture when they forged a three-year extension to the currency swap agreement covering up to $30 billion a year in bilateral trade. Bilateral trade totaled around $75 billion last year, with Brazil selling iron ore, soy products, and crude oil, while buying Chinese machinery, electronics, and manufactured goods. The five nations are deploying a strategy in case a new banking crisis caused USDollar trade finance to cease in function. Using this approach, they are less likely to be attacked by the USGovt and UKGovt pervasive and highly active terrorist agencies, which lays blame on the Islamics or the Chinese for every misfortune of Anglo-American making.

Here is the big hint. At the Durban summit held in early March, the BRICS leaders were also expected to endorse plans to create a joint foreign exchange reserves pool. The proposed development bank and reserves pool reflect a departure from the sinister global bank structures polluted by espionage agents at the IMF and World Bank (reams of proof elsewhere). The reserves pool of central bank money would be available to emerging economies that face balance of payments difficulties. Otherwise, it could be tapped to stabilize economies during crises. It would also convert USTBonds en masse into Gold bullion quietly and secretly, using BRICS supply chains like in South Africa and even the Congo. The SAfrican assigned task is to bring into the BRICS fold the African supply lines, where China has made tremendous inroads in the last decade. Ignore the Western reports of discord among the members on the amounts to seed the fund. It will happen. My belief is that contributions will vary by nation size and reserves wealth stored. See the CNBC article (CLICK HERE).

◄$$$ THE B.R.I.C.S. FUND WAS PROPERLY REPORTED FROM THE INDIAN PERSPECTIVE. AFRICAN DEVELOPMENT IS KEY, BUT SEED FUNDS WERE AGREED UPON IN PRINCIPAL. THE CRISIS RELIEF FUND WAS AGREED IN SEEDING, TO BE DONE IN NATIONAL PROPORTIONS. THE CONTRAST OF STORY TILT IS CLEAR. THE INDIAN GOVT IS SHOWING CLEAR DEFIANCE TOWARD THE UNITED STATES. $$$

The Western press preferred to stress the impasse and insignificance of the consortium, that the BRICS nations need more time to find unity. They supposedly had too much discord to agree of much of anything except the need to build a railroad to Tanzania. What a joke! See the Bloomberg article (CLICK HERE). However, the entire tone was positive out of the Indian financial press on the same events. Two separate tasks are to be pursued, the development fund but also the Contingency Reserve Arrangement (CRA) for crisis relief. Their coverage stressed the importance of Africa, what the Jackass claims. The Indian Prime Minister Manmohan Singh called for the new bank to be established by 2014, without giving details of proposed funding. The first projects the new bank are likely to a major road and rail corridor linking Durban and Tanzania, and an independent global undersea communication network. See the Economic Times article (CLICK HERE and HERE). Some agreement was struck, as the crisis relief CRA fund will call for seeding by $41 billion from China, $18 billion by each of Brazil, Russia, and India, and $5 billion from South Africa. The nations have already learned to apportion the responsibility. See the Hindu Business article (CLICK HERE).

The Indian leaderhip is showing some moxie and defiance toward the United States over the Iran sanctions and financial blockades. The charade has gone on long enough with the phony nuclear threat described by the USGovt fascists. The Indian PM Singh defended openly the right for Iran to develop nuclear energy. Meanwhile India has steadily defied the US-led bans against Iran. The Indian merchant banks will bypass the Iran sanctions, a gutsy strategic decision made on the public stage following the BRICS Summit meeting. The subcontinent will create a facility fund to manage the Iran oil imports on the tanker insurance role. India is set to create a multi-$million Energy Insurance Pool (EIP) fund to support local insurers which offer coverage to refiners processing Iranian crude oil. The Indian Govt will be funded by $400 million, thus extending sovereign guarantees up to INR 100 billion (=US$2 bn) for claims. The domestic insurers will contribute also in time. The fund is the official reaction to disruption of commerce by the self-aggrandizing USGovt obstructionists at the helm. Two major Indian oil refineries, Mangalore Refinery & Petrochemicals and Essar Oil have had difficulty purchasing 100,000 barrels of Iranian oil on a daily basis. The re-insurance fund averts a halt to imports from Iran. The stage is set for fuller cooperation in alternative trade settlement outside the corrupted toxic USDollar sphere. See the Rediff article (CLICK HERE) and the PressTV articles (CLICK HERE and HERE and HERE).

◄$$$ THE B.R.I.C.S. BANKS MADE FINAL A DEAL TO CREATE THE DEVELOPMENT BANK. THE WESTERN BANKS WILL BECOME MORE ISOLATED SOON, LEFT TO STEW IN THEIR WORTHLESS FIAT MONEY VATS SUPPLIED BY THE PRINTING PRESS THAT BEARS A WEIMAR NAMEPLATE. THE WESTERN PRESS IS REPORTING THE BANK PROGRESS INCORRECTLY. A GIGANTIC PARADIGM SHIFT IS IN PROGRESS, WHICH WILL CHANGE THE WAY THE WORLD CONDUCTS TRADE. IT WILL SOON NOT BE USDOLLAR-CENTRIC. THE CONCURRENT CULMINATION WILL BE A CHINESE GOLD-BACKED YUAN CURRENCY. $$$

Despite the incorrect biased self-serving Western press reports, the BRICS nations came to many agreements, and soon will finalize their contributions, the most sticky of points. The new BRICS Development Bank might be supplied with USTreasury Bonds at first. The big nations have committed $100 billion, but their liquidity in reserves lies in form of USTBonds. Look for $50 billion initially, to jumpstart the project. They are highly motivated to bypass all Anglo-American banking structures, which will pave the way toward the climax event of Gold trade settlement. Then a portion of the USTBonds will be converted to Gold bars for the core bank asset. Finally Gold Trade Notes would be used in trade settlement. Like with the Eurasian Russian-Chinese energy foundation, it will be built on the back of USTBonds in toxic discharge, given the name of Indirect Exchange. It is an official name given to shoving toxic USTBonds back down the US & London banker throats. Such is the sequence to anticipate. Expect extreme hardball, returning the toxic USTBonds back to where the US & British banks cannot reject them. Pressure tactics will be used when leverage is available, for to extract Gold bullion from the COMEX with LBMA backstop. See the Bloomberg article (CLICK HERE) and the MG article from South Africa (CLICK HERE).

Roger Weigand added a perspective. He said "Russia said this takes more time than expected for South American nations in the group, but they are dumping the international system of controls. This is very big news in my view." Dave in Denver captures the essence of the Paradigm Shift that will change the way the entire world conducts trade, no longer to be under the constant Anglo-American thumb of control. He wrote, "The [progress by BRICS nations] is important to this post because it underlies a tectonic shift in the global financial landscape going on that is not really being reported by the US media. The BRICS countries (Brazil, Russia, India, China, South Africa) met for a summit in South Africa today. They kicked off the summit by pre-announcing two significant events: 1) a work-in-progress to establish a new development bank that would rival the World Bank & IMF, and 2) Significantly, they signed a trade and currency deal in which the BRICS will conduct trade amongst themselves in their own respective currencies, altogether bypassing use of the USDollar. While both events are significant, the latter is another nail in the dollar's coffin." See the Yahoo News article (CLICK HERE) and the Seeking Alpha article (CLICK HERE). While a final comprehensive agreement to establish the new development could not be formed, the BRICS nations succeeding in establishing a $100 billion fund designed to address any financial crises among their developing economies. The fund is a precursor for the larger development fund. See the ZEE News article out of India (CLICK HERE). The Western reporting is blatantly incorrect on this entire topic.

Anticipate in the next few years, China is going to assert its economic power by rolling out some kind of gold-backed Yuan currency that will be used to replace the USDollar as the global trade reserve currency. My forecast is that it will be coincidental and equivalent (temporarily interchangeable) with the Gold Trade Notes soon to be introduced. Expect that the new gold-backed Yuan currency will also involve a significant upward revaluation of the price of Gold to accommodate the entire process and to bring legitimacy to the Gold core it features. See the Truth in Gold article (CLICK HERE).

◄$$$ THE B.R.I.C.S. NATIONS ARE TAKING HUGE STEPS WITH PROGRESS ON SEVERAL FRONTS. A TRADE COUNCIL HAS BEEN FORMED. A HIGH CAPACITY CABLE FOR COMMUNICATIONS WILL BE CONSTRUCTED. BUT MORE IMPORTANTLY, THE HYPOCRISY OF THE WEST AND THE FAILURE OF KEYNESIANS IS IN FULL VIEW. $$$

The BRICS nations are making great strides. They are eager to set up an Eastern system outside the dark shadow and hegemony from the West, complete with espionage, subterfuge, and criminal market controls. The Indians will be firm staid partners in the new alliance and established trade zone. Politics is at play on India participation, since the finance minster Chidambaram seems more motivated to appeal for Western equity participation than to pursue an exclusive BRICS function for the development fund. He is Harvard educated and a Keynesian clown who will soon to be out of a job. The key factor is Indian corporates, who are ignoring the present administration and forging ties across the BRICS walls. See the demeaning Rediff article (CLICK HERE) and the BDLive article from South Africa (CLICK HERE).

Expect a significant new project to launch soon, as the private sector will begin the construction of an undersea telecommunications cable linking the BRICS countries. They want independence. The new high capacity cable of 28,400 kilometers (=17,750 miles) linking the BRICS countries will eliminate the dependency on developed countries as interconnection points by providing for direct routes. The adept observer can notice a new unmasking of Western hypocrisy. See the Bloomberg article (CLICK HERE). The geopolitical winds are changing fast, but Western nations are too preoccupied with USDollar printing press adoration, vapid bank bailouts, theft of wealth, and extreme controls of every single major market. The floor will drop out for the USDollar in a matter of months. The gold market smashdown only offers temporary pychological lift and fleeting credibility for the USDollar system.

## CHINESE YUAN WINS GLOBAL RESERVE

◄$$$ ISTANBUL TURKEY WILL HOST A G20 SUMMIT WITH RUSSIA IN MAY. THE AGENDA IS TO RE-INVENT THE BRETTON WOOD GOLD STANDARD. THE NUTS & BOLTS WILL BE COVERED ON A RETURN TO THE GOLD STANDARD THAT IS SO URGENTLY NEEDED IN ORDER TO RESTORE STABILITY TO THE WORLD FINANCIAL SYSTEM. MOMENTUM BUILDS TO ISOLATE AND SEND THE USDOLLAR TO THE DUSTBIN. $$$


The Turks will host jointly with the Russian finance ministry a conference for the G20 nations, those pesky nations that insist on retaining their industry and collecting  wealth from tangible work not associated with pushing paper and worshipping debt. The G20 nations are no longer are motivated to continue playing the USDollar and fiat paper currency game. Their conference is entitled "Global Finance in Transition" and will take place on May 7th and 8th. The energy and importance of each new G20 Meeting grows in sequence. The hosts are key players. The event is organized by the central bank of Turkey jointly with the Reinventing Bretton Woods Committee and the Russian Ministry of Finance. The agenda has been disclosed, to re-invent the Bretton Woods Accord, otherwise known as the Gold Standard.

Several panel discussions are planned as part of the event. They will cover 1) the international financial architecture such as changes in the flow of global investments, 2) local bond markets, 3) growth in emerging economies, 4) incentives and determinants of investment. In addition it is expected that new instruments and incentives for making the global financial system safer will be suggested during the forum. The program is scheduled as ambitious, the incentives certain to overturn the entire USDollar system. The new architecture would be gold-based, and divorce from USTreasury Bonds as a destructive debt foundation. The local bond markets are direct assaults on the USTBond complex, the current standard.

The nation of Turkey is critical for the gold intermediary function in trade finance, as in trade settlement. The Russian Govt has set out to further hasten the replacement of the USDollar with all its colossal corruption. The Kremlin has had enough, done. Representatives of G20 finance ministries and central banks, international organizations, research institutions, and key businesses will participate in the conference. The opening remarks to kick off the conference will be given by the Head of Turkey's Central Bank Erdem Basci, Deputy Russian Minister of Finance Sergei Storchak, and Executive Director for the Reinventing Bretton Woods Committee Marc Uzan. See the G20 Russia article (CLICK HERE).

Turkey is defiant, and has made its choice to align with the East. It would be intrigue filled if they kicked the USMilitary off the Incirlik Air Force Base. Not gonna happen, since the United States Govt uses the base in heroin transport. The Gold Standard is coming. The Western argument put forth by the corrupted clowns that pollute Wall Street and London banks is that an inadequate amount of Gold bullion exists to cover the money. They are backwards. The problem is too much money, not an insufficient supply of gold. The Gold price will rise multiples higher to meet the need to cover the skyrocketing supply of money. Expect a Gold price between $7000 and $10,000 per ounce in the not too distant future. Expect a Silver price between $200 and $500 per ounce in the not too distant future.

◄$$$ AUSTRALIA HAS ANNOUNCED EXCLUSIVE YUAN-BASED TRADE WITH CHINA. THEIR YUAN SWAP FACILITY WILL BE USED SOLELY, AS IN NO MORE USDOLLAR-BASED SETTLEMENT OF CONTRACTS. THE BRITISH COMMONWEALTH HAS ENTERED THE CHINESE CAMP, SNIFFING THE FUTURE WINDS. $$$

Australian Prime Minister Julia Gillard is set to sign a currency deal China, further chipping away at the USDollar trade settlement standard. The currency deal will enable the Australian Dollar to be converted directly into Chinese Yuan, slashing costs for thousands of businesses and thus boosting export trade. It is to be (was) the centerpiece of the mission. China is Australia's foremost trading partner, with a total of $120 billion in trade last financial year, quite significant. China buys nearly one third of Australian exports. The core American ally nations are moving into the Chinese fold. The United Kingdom and Japan have already secured such swap barter facilities from China. London vies for the Yuan-based bond trade (Dim Sum). Tokyo will follow the leader and stick with the regional Asian unity. See the Australian article (CLICK HERE). The British gradually will leave the Americans swimming in the toxic USDollar pool.

Australia wants to cut out the USDollar in trade with China, as cost expedient and in synch with the Eastern trade trend. They wish to avoid the commercial uncertainties that arrive with the fluctuations in the greenback exchange rate. Removed would be currency conversion risks and transaction costs, like for the many mining firms that export to China. The Australian Govt has made no secret of its intentions to shift away trade from the USDollar. A recent government report entitled "Australia in the Asian Century" discussed efforts to establish direct trading between the Australian dollar and the Chinese currency. Furthermore, it went one step further, also advocating increased prominence of the Chinese Yuan as a global reserve currency. Several fronts are being worked on to support the internationalization of the Chinese currency. The Aussie officials aim to build on a $30 billion currency swap deal with China signed last year, which facilitates business transactions between leading banks in the two countries. See the Intl Business Times article (CLICK HERE). The sun is setting on the USDollar in the South Pacific, a far cry from the Rudd days where the Aussies spent A$billions wastefully when following the Bush II Admin goose step march.

◄$$$ FRANCE PLANS A CHINESE YUAN SWAP FACILITY, IN A BID TO COMPETE AGAINST LONDON FOR THE CHINESE FINANCIAL BUSINESS. PARIS ALREADY HAS MORE YUAN-BASED BOND TRADE THAN LONDON. BUT TO LIFT PARIS AS A FINANCIAL CENTER, FRANCE MUST MOVE AWAY FROM THE SELF-IMMOLATION THAT IS SOCIALISM. THE WEST IS SPLINTERING IN MOVEMENTS TOWARD THE EASTERN FOLD, AND AWAY FROM THE CORRUPT ANGLO-AMERICANS. $$$

The Bank of France is working toward a Chinese Yuan Swap Facility, which would be the first on the continent. Central bank governor Christian Noyer said, "The Bank of France has been working on ways to develop a RMB liquidity safety net in the Euro area with due consideration of a supporting currency swap agreement with the Peoples Bank of China." Total Yuan deposits in Paris amount to 10 billion Yuan (=US$1.6 bn), the second largest pool in Europe after London. The goal is to raise the portion the 10% of Sino-French trade currently settled in Yuan. The Paris bankers are ambitious but full of baseless dreams. They wish to make Paris a major offshore Yuan trading hub in Europe, competing against London. Not likely, especially since the French Govt is loaded with self-destructive socialists, who will be busy preventing an implosion during capital flight northward to escape federal clutches. The planned swap line with China followed a similar step by the Bank of England to set up a reciprocal swap line between Yuan and Pound Sterling with China over a three year period.

Noyer wishes to improve the Paris position in corporate bonds and short-term negotiable debt securities markets with wider promoted usage of the Y uan. In 2011 and 2012, the total value of offshore Yuan-denominated bonds issued by French corporations was CNY 7 billion, twice the value of bonds issued by their British counterparts. The financial association Paris Europlace reported that 50% of French companies have used Yuan-denominated products and services. Broader bond sales would open up the Yuan gates further, and provide the propagating currency an opportunity for higher exchange rates. It would also serve as a key requirement for the Chinese Yuan to become a trade standard, if not a global reserve currency. Beijing officials are gradually allowing a degree of greater flexibility. See the UK Reuters article (CLICK HERE)

While the United States fiddles with $trillion budget deficits, orders constant bond monetization, pounces on gold markets, rigs the FOREX, engages in endless war, protects the corrupt big banks, and lately plans to steal private accounts in an egregious display called euphemistically Bail-ins (a la Cyprus), the rest of the world, including key elements of the Western allied formation are aligning with China. The world could be reacting to the fascist bankers and their dull plan of financial destruction centered upon USTBond ruin, turning away from the nazi master plan of a grand staged implosion. They see the future trend. They see the demise of the American Empire. They see the implosion in progress within the Untied States with unstoppable momentum. The Australian and French plans put more nails in the USDollar coffin as global reserve currency.

◄$$$ THE CHINESE HAVE RESUMED GOVT BOND ISSUANCE. THE ADVENT OF DOUBLE BARRELED ARBITRAGE IS COMING, IN BOTH GOLD AND SOVEREIGN BONDS. THE USDOLLAR IS ON THE VERGE OF A MAJOR ASSAULT, AS GOLD BULLION WILL BE PURSUED AND USTREASURY BONDS WILL BE DUMPED. THE ACTIVITY TO UNDERMINE THE USDOLLAR AND ITS USTBOND VEHICLE WILL TAKE PLACE ON THE SHANGHAI METALS EXCHANGE. $$$

The West misses the significance of the development occurring in Chinese markets. With the advent of bond futures, arbitrage between Chinese Govt Bonds and USTreasury Bonds can proceed apace. The Beijing trade in futures has been suspended since 1995. Observe the next avenue to dump USTBonds in large volume. It will become more overt and explicit. Combined with arbitrage on USDollars versus Yuan, a powerful potential has been created. The stage is being set for deeper Chinese resources brought to bear in a powerful combination that would discharge USTBonds and pursue Gold bullion, with the aid of futures devices and leverage used, to take pace at the Shanghai Metals Exchange.

The China Securities Regulatory Commission has decided to resume trading futures of government bonds following a lapse of 18 years. The prospective bond contracts bear a value of 1 million Yuan (=US$160k) and have five-year terms, with a 3% interest rate set. The basic framework including transaction targets has been completed, with rules and risk control submitted for ratification. The bonds are scheduled for a complete launch in the second quarter (now). Trade of bond futures is listed as one of its ten major goals for this year. A new trading system has been confirmed. The New York and London bankers will face some competition from their incredibly deep corruption and market controls. In all, 28 futures exchanges in 26 countries have rolled out futures for government debt, including the 15 largest economies worldwide and fellow BRICS members Brazil, Russia, India, and South Africa. The BRICS are setting up platforms to discharge USTBonds in large volumes, with almost no attention given by the West, caught in the crisis situation room. An effective systematic risk management mechanism will be enabled following the 2010 successive launches of margin trading, short selling, and stock index futures. See the Want China Times article (CLICK HERE).

◄$$$ CHINESE SOVEREIGN DEBT HOLDINGS SHOW A DROP BELOW 7% IN EUROBONDS. WITH ALL MAJOR CENTRAL BANKS DEBASING THE CURRENCIES, THE MOTIVE WILL BE ENHANCED TO DIVERSIFY OUT OF BONDS AND INTO GOLD BULLION. THEY WILL PUSH FOR THE GOLD TRADE SOLUTION AND UNSEAT THE KING USDOLLAR IN A HASTENED INITIATIVE. $$$

The foreign reserves held by China contain less than 7% in EuroBonds, reflecting a decline. In terms of currency structure, Chinese debt in USDollar terms accounted for 77.8% of the outstanding registered external debt. Debt in Euros accounted for 6.6%, while debt in Japanese Yen was 7.4%. The Chinese will not add to EuroBonds, since the continent is fracturing. The Chinese will not add JapGovtBonds, since the Bank of Japan is advertising its competitive currency debasement, a program sure to end badly. The Chinese will continue to dump the USTBonds en masse, seeking Gold bullion and infrastructure deals and energy supply in response to the unilateral USFed bond monetization and currency system debasement. It is deep and deadly. The Chinese reserves are growing leaps and bounds in Gold, but the data will not be forthcoming.

◄$$$ THE CHINESE YUAN IS TO BECOME GLOBAL RESERVE CURRENCY, AN UNDENIABLE MOVEMENT IN PROGRESS. TRADE POWER WILL BE REFLECTED IN CURRENCY UNIVERSALITY TOWARD RESERVE STATUS. THE TREND DICTATES THE CURRENCY ELEVATION. A DEATH BLOW WOULD BE THE SAUDIS ACCEPTING NON-USD PAYMENT FOR CRUDE OIL. $$$

The Intl Monetary Fund has confirmed the Chinese Yuan currency is set to become a global reserve currency at an Economic Forum in Hong Kong. The West did not offer press coverage, in usual inept style. The news should have come with shock waves and warnings of impending financial tsunamis. Instead, the New York and London criminal bankers increased their ambush on Gold. Nothing has changed, as China has been stealthily buying Gold and will also float the Gold-backed Yuan as alternative reserve currency. The USDollar is in its sunset. The announcement actually came from Zhu Min, deputy managing director of the IMF, which indicates the shift toward the East in its office emphasis. Trade dictates bank activity. With the Yuan being called a global reserve currency now even by China itself, they have laid the foundation for a grand transition, sure to cause tremendous disruption. The US faces the prospect of entry into the Industrialized Third World, its population in total darkness. Thus more motive to escape from under the mountain of gold futures contracts, and the criminal smashdown.

If Saudi Arabia permits crude oil trade in something other than theUSDollar, then game over for the USDollar as the global reserve currency. The announcement would serve as a USDollar eulogy statement, an obituary column. Crude oil is the baseline trade product. The USFed is printing the USDollar non-stop, angering the world's creditors. The currency wars are raging, pitting nation against nation in a battle to preserve export trade. The grand Paradigm Shift sudden flash event will be the introduction of either a Gold-backed currency like the Yuan, or a new system of trade settlement based upon Gold in net transactions. At the time of such a flash event, the other countries will be able to stop their currency devaluations against the USDollar because a new hero system will have arrived. Ironically and pathetically, the USDollar is supported by major nations pushing down their currencies. The USDollar will rise until it dies. See the Want China Times (CLICK HERE).

## USDOLLAR LOSES GLOBAL RESERVE

◄$$$ THE PERSISTENT ZERO INTEREST RATE POLICY, THE ENDLESS QUANTITATIVE EASING ROUNDS OF BOND MONETIZATION, THE DANGEROUSLY EXPANDING USFED BALANCE SHEET, THE OBSCENE BIG BANK WELFARE AID, THE REGULAR GOLD MARKET AMBUSHES, AND THE AGGRESSIVE WARS SCREAM OF LOST INTEGRITY AND FAILURE OF THE USDOLLAR UNDER MANAGEMENT. $$$

A systemic failure comes with frightening momentum. The United States has failed to curb corruption and debt abuse, even rampant counterfeit. Its official regulators have failed to prevent corrupt financial market infiltration. An economy run on a credit card, unspeakable market interference, unbridled debasement of the USDollar, vast undermine of the gold market, these have led foreign nations to work feverishly to avert the disaster by establishing an alternative for trade settlement and bank reserves structures. Like the Roman Empire, the American Empire is beset by corruption and ethical depravity. If not practicing satanists or narcotics advocates, these are morally bankrupt psychopaths. Permit me to be very clear. My personal belief is that the 911 attacks were a hidden nazi coup d'etat, the Patriot Act a veiled nazi manifesto, the Homeland Security a blatant Gestapo, and the private account thefts to come the climax of the financial destruction of the newest nazi nation, the United States of America, emerging from the Axis of Fascism that bonds the US to the United Kingdom and the little ally nation on the Southern Mediterranean that looks northwest to Italy.

Theft is their game. War is their sport. Bond fraud is their trade. Propaganda is their message. Narcotics is their triumph. Genocide is their heart & soul. If a poll were taken, not 1% of Americans would show awareness of these hypotheses, which the Jackass holds as verified facts. The punishment for failure to recognize the nazis in banker uniforms will be lost wealth, whereby during the implosion they have re-written the bankruptcy rules to ensure colossal citizen wealth in the grand toilet flush that inevitably comes. Never in recent history have the nazis been so wealthy, this era driven by narcotics exploit and overflowing profits.

The nazis have bribed and coerced all major forces in the world, except maybe China. Past cut deals with the United States and China have been superceded by old families coming forward to take the mantle of rule in Beijing. Instead, the Wall Street warlords betrayed China by working a deal of foreign direct investment toward factories in return for leasing the Mao Tse-Tung gold hoard, all part of the granted Most Favored Nation status that opened the door. The Chinese held up their bargain by recycling trade surpluses into USTreasury Bonds. China held its end of the bargain by leasing huge gold tonnage, and the Wall Street bankers extended their gold game beyond selling the entire Fort Knox pilfered inventory. But the USGovt betrayed China by refusing to return the leased Gold, the deadline in 2007 or so. They had sold the Chinese gold assets illicitly. The trade rivalry turned into trade friction, now heated trade war, even hot military war in Southern Africa. Ironically the hope for capitalism let loose, even freedom, and release from economic shackles lies with Russia and China, the Germans along side as counselor. The Saudis will nail the coffin shut on the USDollar.

The two threats on my life came in 2006 for public writings on precisely this topic, complete with my listing of their modus operandi. The threats serve as personal proof. Despite all the tactics deployed, the end result will be the USDollar loses its cherished global reserve currency once ensconced in prestige. As the lost reserve status unfolds, the nation will plunge into the Third World. My firm expectation is that even after citizens are shot on the street by police and military, even after the concentration camps are open for processing with brutal executions, the American public will remain deeply ignorant. My respect for the Hat Trick Letter subscribers and gold advocates is as high as my respect is low for the American public. They are a near perfect subject ground for breeding nazi hatred while lacing distrust and betrayal within the society, the bitter fruits of nazi rule. The USA had to be wrecked in order to open the path to the upcoming brutal Western fascist rule.

◄$$$ THE USGOVT BUDGET DEFICIT IS RISING FAST. THE TAX HIKES AND OBAMACARE COSTS STRUCK HARD, INFLICTING DAMAGE TO THE USECONOMY. THE SEQUESTERED SPENDING CUTS ARE HAVING A RIPPLE EFFECT. THE AUSTERITY POISON PILL HAS BEEN SWALLOWED FINALLY BY THE UNITED STATES. THE DAMAGE WILL BE SEVERE. EXPECT THE BUDGET DEFICIT TO RISE TOWARD $1.5 TRILLION ANNUALLY AGAIN. THE USDOLLAR WILL RISE AND RISE, THEN DIE FROM GLOBAL REJECTION IN A SUDDEN FUTURE SHOCK. $$$

Nothing has been fixed, nothing reformed, no recovery possible. No big bank liquidations have occurred, no financial prosecutions pursued, no military fraud checked, no recovery possible. The ZIRP & QE & narco wars have combined with egregious economic counsel and bank syndicate criminal activity to produce unstoppable downward momentum. With no solutions being pursued, only power to be preserved by the big US bank fortress, no recovery is possible. Any fleeting obscure benefits from hyper monetary inflation have departed the economic stage, such as ripple effects from bond carry trade and consumer spending off stock gains. The USTreasury Bond ponzi is soon to come apart, not in visible ways. It will require total devotion by the USFed in bond purchase, since foreigners are seeking alternatives while diversifying on bond reserves. Worse, Eastern fortresses are discharging USTBonds in volume, which must be absorbed by the USFed and Bank of England ultimately. The damage to the USEconomy is staggering, from capital destruction due to hard asset hedges to inflation and mispriced money. The report card will be fast falling economic activity, well documented in the Hat Trick Letter, marked to market by a gaping growing gargantuan USGovt budget deficit. It is going out of control again. The tide is going out to sea for the United States.

Economist John Williams from Shadow Govt Statistics warns that the banking crisis in Cyprus has global implications. He expects more USGovt debt downgrades. He expects a USDollar selloff, which is the opposite of my forecast. It will rise until it is deeply devaluated and declared dead. Williams wrote, "The economy is still in serious trouble. The banking system is still in serious trouble. The budget deficit is exploding out of control. You have a precedence set in Cyprus that they can seize the funds. They will not guarantee all deposits. If that is the case, you may have a much worse crisis than you had back in 2008. The big problem is the government is insolvent in the long term. The global markets are looking for the United States to address its long-term sovereign solvency issues.  That is not going to happen. In response, it is going to be off to the races with a dollar sell-off. That could be the trigger for the early stages of hyper-inflation." The Jackass is firm, that the foreign currencies will be pushed down from the Competing Currency War. Thus the USDollar will rise and rise. However, my view is in synch with Williams on the end game, as the USDollar will be rejected globally in trade settlement usage. It will therefore be discarded in the global banking systems. When the global shun occurs, the USDollar will suffer at least a 50% devaluation. But the rejection and diversification will come as a quantum leap extreme shock down the road when the crisis hits a climax. The end result will be the USDollar death, probably to be replaced by a real Third World currency. See the USA Watchdog article (CLICK HERE).

The Jackass agrees about the fast rising budget deficit. However, strong disagreement comes as usual with Williams on forecasts. He is an excellent data collector and economic index specialist to avoid contamination. He lacks in forecasting capability, and has been way off for years. But my respect is high for his work. The USDollar will rise from all the Western problems, since other nations are equally damaged fiscally, but they have no protective devices like the Exchange Stabilization Fund or the Interest Rate Swap facility. They do not control the USDollar printing machinery. So foreign currencies will fall versus the USDollar. Also, the hyper-inflation within the USEconomy will come not from a USDollar selloff in the FOREX markets, but rather from a global USDollar rejection as foreign reserve currency standard in sudden shock. Williams is brilliant in dissecting and presenting accurate economic data. Stick with his strengths, and pass on his forecasts. The intermediary steps will foster great confusion and paradox. The gold market ambush has lifted the USDollar. Most currency action in the last few years has been opposite to his forecasts, which he should refrain from. But his forecasts on the budget deficit is within his domain of excellence. He produces the best and most valid economic statistics in the world for the USEconomy. The Jackass has great respect for Williams in his element.

◄$$$ THE BANK OF JAPAN HAS AMPLIFIED QUANTITATIVE EASING, AND THE YEN CURRENCY FELL. THE USDOLLAR IS SUPPORTED BY FOREIGN CURRENCY DEBASEMENT. A RISING USDOLLAR CURES ALL ILLS APPARENTLY ON THE PROPAGANDA STAGE. THE NATION IS ON COURSE FOR SYSTEMIC FAILURE. THE USDOLLAR WILL RISE UNTIL IT IS EXTINGUISHED, BOTH ITS LIFT AND REJCTION DONE AT THE HANDS OF FOREIGN NATIONS. IRONICALLY, THE TOKYO VENTURE INTO DERIVATIVES COULD BACKFIRE ON THE WALL STREET BANKERS. $$$

The Bank of Japan is utterly pathetic. With at least 30 officially sponsored QE programs, none of which accomplished anything, they have decided to embark on another. The central bank in Japan will introduce quantitative and qualitative monetary easing. All cheer the destruction to capital and wrecked corporate structures. The BOJ will hike purchases of Japanese Govt Bonds to an annual pace of nearly JPY 50 trillion (=US$530 bn). They will purchase bonds of all maturities rather than deploy the previous plan to buy only bonds within three years form maturity. They will increase purchases of exchange traded funds for stock market support, and increase purchases of real estate investment trusts for property market support. Morons and paper addicts alike cheered the hari-kari done on the financial stage, as the Japanese Yen currency fell hard. See the Zero Hedge article (CLICK HERE).

The consequence is the rise of danger, the arrival of the most likely site of systemic failure among the Eastern nations. Kyle Bass has issued warning. With style, he contends that the AIG of the world is back, namely Japan. The lead violator among currency wardens lies in Japan. Bass expects the Yen currency to die first. It has the worst debt to GDP ratio, the worst demographic trends in its population. It has near zero resources. Juxtapose the QE782 in Japan with their recent announcement that Tokyoyo will embark on brisk derivative trading activities, surely out desperation and elevated fear. Perhaps they will purchase a ripe $20 trillion in bond rate calls form the eager US banks, merchants of financial death. If the JapGovtBonds blow up, it could deliver the final death blow to the US banks on the derivative pipeline of slime. The Japanese have given the death knell for the global banking system. See the Zero Hedge article (CLICK HERE).

The motive to produce cost-push inflation should result in disasters to both Japanese exporters and individual savers. They are secretly scared of wrecking the JGBonds with rising rates, thus the need for derivative clamps. They want to produce price inflation. They strive to imitate the Bernanke Fed. The Japanese have promised to do whatever it takes to produce inflation, including unsterlized bond monetization, but in doing so, they embrace financial witchcraft and medieval alchemy. Theirs is a large economy, the third largest in the world, a good bit larger than Germany. Expect the price inflation spawned in Japan to spread worldwide, like in final product prices for cars, domestic electronics, and construction equipment. The silver lining so to speak, is that the rising consumer price inflation could provide the impetus to spark the first true Gold price breakout. See the Silver Doctors article (CLICK HERE). After the mid-April gold smashdown, Japan is likely to be the site of a fast snapback rally.

◄$$$ BRICS NATIONS CONTINUE TO DUMP THE EUROBONDS. CENTRAL BANKS IN THE WEST ARE FAST APPROACHING A MAJOR PANIC. SUCH IS THE RISK WHEN ADOPTING A LONG ENDURING BOND MONETIZATION PROGRAM. THEY HAVE DESTROYED THE FIAT PAPER CURRENCIES, THEIR BONDS, AND THEIR ECONOMIES. FASCISM COMES NEXT IN THE MOST FIERCE AND BRUTAL FASHION, IN ORDER FOR THE BANKERS TO RETAIN POWER. NO SIGN YET OF ANY BIG BANK LIQUIDATIONS. $$$

Emerging economies led by Brazil, Russia, India, China, and South Africa (BRICS) are dumping the Euro in heavy volume. They sold a combined EUR 45 billion worth in the currency in year 2012, according to the IMF. Such is the risk when the central banks lead the way on a destructive bond monetization program. The onlookers include many bond investors, who react by dumping the bonds. Then later the floor falls out, from total lack of buyers on the toxic Weimar paper. The gold market smashdown is but a symptom of the floor falling out. They know that the BRICS Development Fund is going to appear soon, and become a major factor. They know the US and Western Europe are excluded from the Eurasian Trade Zone, excluded like financial pariahs or cancer ward residents, if not financial lepers. They know the Anglo-American failure will result in the Industrialized Third World showing itself with stark blemishes and nazi brutality. The trend begun in 2012 has continued. Russia announced in March the amplified sale of EuroBonds. The other BRICS nations will follow with their own amplifed sales, done in multiple rounds. See the RT News article (CLICK HERE) and the Before Its News article (CLICK HERE).

◄$$$ VENEZUELA CONDUCTED ANOTHER 47.5% CURRENCY DEVALUATION VIA A SLIPPERY IMPORT AUCTION. THE TOTAL 72% DEVALUATION HAS HAD IMPACT IN THE LAST 50 DAYS. THE EFFECT WILL BE DEVASTATING TO THOSE WITH SAVINGS ACCOUNTS, WHILE THE PRICE INFLATION WILL RISE TOWARD 130%, GRADUALLY IMPOSED. THE BIG WINNERS ARE GOLD INVESTORS INSIDE VENEZUELA. $$$

A Venezuelan Govt foreign currency auction designed for local importers triggered a defacto currency devaluation, the second in less than 50 days. The strict currency exchange controls Venezuela had imposed since 2003 are being reversed quickly, and with violent results. They did nothing to halt capital flight, as my contact assures me that the wealthy put their money in Panama and US banks. CarlosS is former branch manager to the Jackass local bank, when living in Pennsylvania, who was taken to lunch to firm the relationship. He went on to work for JPMorgan in London, having zero good to say about the firm. His extended family congregates in New York City in Queens. He claims every wealthy friend and acquaintance removed money from within Venezuela long ago. It will return only after Chavez is gone (done). At the auction, individuals and businesses obtained limited amounts of foreign currency through the government at an official rate. Strong demand for USDollars and Euros persisted, fueling a black market which essentially drove the process. The auction plan known as SICAD involved US$200 million offered to a group of 383 chosen unnamed companies. It was a veiled devaluation. The exchange rate went from 5.3 Bolivars per USDollar to about 12.0 per US$. The import dependence has been tremendous for the nation, soon to be quelled from a staggering triple in price on imported goods and products. See the Pako Observer article (CLICK HERE).

As usual, the elite benefit from inside information. The officials and selected friends bailed out of their propped Bolivar currency ahead of the second devaluation. The real winners were Gold investors inside Venezuela in recent years. The Venezuelan Bolivar has collapsed from 860 in 2005, to over 20,000 now. Hence over a 23-fold move (2300%) in the Gold price over the last eight years in local currency terms, before the gold smashdown. See the Bull Market Thinking article (CLICK HERE). The outsized Venezuelan currency devaluation is exactly what lies in store for the USDollar, but only after it is further isolated, and ready for global rejection.

## THANKS

Thanks to the following for charts StockCharts, Financial Times, UK Independent, Wall Street Journal, Zero Hedge, Business Insider, Calculated Risk, Shadow Govt Statistics, Market Watch, and more.