## KEY QUOTES
"Those who are able to see beyond the shadows and lies of their culture will never be understood, let alone believed, by the masses." ~ Plato
"It is utterly amazing how the world's leading financial experts, even those in the gold camp, overlook the essentials for a stable global financial structure. 1) gold trade payment system for fair settlement, 2) gold backed currency system for legitimacy, and 3) honesty in monetary policy to prevent $trillion counterfeit. Only Gold & Silver basis for currency and trade satisfies the requirements. It is coming, with a shock, to arrive in steps, the supporting platforms under construction." ~ the Jackass
"We, Asian and African countries, demand that the United Nations reform to function optimally as the world body that puts justice for all nations first. For me, the global imbalance is getting more and more suffocating. There is a shifting world reality. Those who say the global economic problems shall only be solved through the World Bank, the Intl Monetary Fund, and the Asian Development Bank, these are obsolete ideas. There needs to be change. It is imperative that we build a new international economic order that is open to new emerging economic powers." ~ Joko Widodo (Indonesian President, in address to the United Nations)
"Whatever goes on out there with all the manipulations, it won't last forever. It is like people at a beach watching the water recede before the tsunami comes rolling in and consumes them, or before an earthquake strikes. The animals will leave the area long before it happens. I don't believe, I don't hope, I don't think. Instead I know what is going to happen. Gold & Silver will not only survive what is coming, but the two precious metals will be at the core of the new monetary system soon to emerge after the giga Global Reset event. Humanoids are just incredibly stupid fuckheads. And Jim Willie can quote me!" ~ the Voice (suspected as hired consultant on entire Reset)
"At the moment there is little indication that generalized financial imbalances are emerging." ~ Mario Draghi (head of the EuroCB, a arrogant fool)
"The power which the strong have over the weak, the employer over the employed, the educated over the unlettered, the experienced over the confiding, even the clever over the silly, the forebearing or inoffensive use of all this power or authority, or a total abstinence from it when the case admits it, will show the gentleman in a plain light." ~ Robert E Lee (leader of Confederate Army in US Civil War)
"If we want to have an educated citizenship in a modern technological society, we need to teach them three things: reading, writing, and statistical thinking." ~ H.G.Wells
"The so-called rulers, political and economic elites of these [Western] countries love us only when we are poor and are begging with an outstretched hand [as in the Boris Yeltsin era of the 1990s]. As soon as we begin to speak about our interests, they feel geopolitical rivalry. I read various documents while being the head of FSB [Russian Federal Security Service], including the interception of international terrorist conversations, they wrote to each other 'IT IS A UNIQUE HISTORICAL MOMENT, WE HAVE AN OPPORTUNITY TO REND THE CAUCASUS OFF FROM RUSSIA, NOW OR NEVER.' My colleagues, many presidents, prime ministers, told me then that they had decided for themselves that Russia would stop existing in its current form. The only question was when it would happen and what would be the consequences. Meaning that it [Russia] is a major nuclear power." ~ Vladimir Putin
"Russia and China and Germany will serve as giant locomotives with massive pulling strength traction, torque, and leverage for the Eurasian Trade Zone railway. Expect the late entries of Japan and South Korea to be rear positioned locomotives to come. The union will feature eventually a locomotive powering the front and back. The tail end can instantly become the leading end and vice versa, at the flick of a switch. This chain will feature no weak links, and will operate rail cars on every continent." ~ JillG (Hat Trick Letter client from Hawaii)
"If the gold market (the gold price) is ever liberated, then governments and central banks are going to lose power. They will fight to the end for this power. They can shut the markets down. They can outlaw certain financial instruments. They can outlaw possession of gold. They can confiscate gold. They can throw people in jail as terrorists just because they want to get out of the financial system. We may end up with a totalitarian system in the West when the metal runs out." ~ Chris Powell (Gold Anti-Trust Action founder)
"I think we are fairly close to a systemic breakdown and if that occurs, the price changes in all asset classes are going to be extreme. Gold & Silver bullion and their respective equities are arguably the cheapest assets on the planet today and remain historic safe havens, even if most of the morons in our society fail to realize that fact at the present time. I have always found that buying under-valued, under-owned and most assuredly under-loved quality assets to have been a sound strategy. The fact that we are at historic extremes in everything today just reinforces that opinion. I may be under-estimating the opposition but I think they are in deep trouble. I would much rather be playing our hand rather than theirs at this moment." ~ John Embry (Chief Investment Strategist, Sprott Asset Mgmt)
"The Voice does not deny that the Banker Cabal owns significant gold in private accounts, like in the Carlyle Group. But in early 2014 early he dropped the key little nugget that they made a big mistake when trusting certain vaults. It was a big error of judgment. They will not have access to their gold in these vaults, since the gold is gone. Many vaults including some of theirs have been cleared out in reaction to the shortages. The destination for most buying has been Asia. The cabal does not have total control by any means, especially of the many large gold vaults." ~ the Jackass (kind of like rehypothecation in reverse, a sweet irony)
"Nobody pays any attention to rules, orders, policies guidelines, pacts, plans, or anything from Washington anymore. They only pursue how to block their next chess move, usually well telegraphed, and how to obstruct their next major criminal deed in defense of the fatally wounded USDollar." ~ the Voice
"Eventually the US leaders will be on their knees begging not to be isolated and quarantined, but the world will say GET LOST & STAY IN THE CORNER. Then comes the Chinese Commercial Colonization, which will have many good sides in rebuilding the economically war-torn nation. The US has much skilled labor in the waiting room. However, the new labor market surge will not include expansive fringe benefits or generous workmen's compensation or sweet life insurance policies. The United States desperates needs a much larger industrial base after a generation of outsourcing. It will be China that leads the project. The new industry will be urgently needed to bring a halt to the devaluation sequence in the New Scheiss Dollar, since deficits (fiscal & trade) will be massive and difficult to bring down." ~ the Jackass
"All too many times the phrase 'GOOD ENOUGH FOR GOVERNMENT WORK' has been heard, meaning inferior quality laced with laziness and high cost. Think about the attitude it implies toward the performance of work or the quality of product to meet requirements in a Government contract. The results of that attitude give you a program like the over-engineered and costly F-35 fighter jet, way over budget and laughed at around the world! It is the Poster Boy for a bad program. Government spending in the United States is at 35% of total national GDP. Private industry should give more respect to government contracts, and provide the best work, because in most cases the federal spending is on building the infrastructure. All private businesses use the roads, bridges, railways, and ports to function and remain in business. Take a closer look at the mess seen in most infrastructure these days, The Society of Civil Engineers has rated US infrastructure a D minus. The nation is running a 2015 country on 1978 infrastructure, which does not bode well for our economic future. But do not worry, as we are about to pour a $trillion into projects to upgrade our nuclear ICBM missile force. We are busy protecting the junk we call infrastructure for the next 40 years. Such is at the macro level. The micro level is just as bad. You see the vast array of convenience stores with their $30,000 spent in security equipment to protect rather minor inventory supply, as well as those $100 in candy bars and $50 of twinkies on the rack." ~ a bright angry HTLetter subscriber
"There will be serious, deadly consequences to our [as in United States] irresponsibility, which emanated from both party's lack of financial discipline. At some point the Federal Reserve will lose control of the bond market. Our fiat currency will only be worth the paper it is printed on. The top-heavy Western socialist welfare state societies will collapse under their own weight." ~ Todd Wood (US economist and author of the book "Currency" which portrays the imminent US collapse and rise of resource rich Russia)
"I could end the deficit in five minutes. Just pass a law that says that anytime there is a USGovt deficit of more than 3% of GDP, all sitting members of Congress are ineligible for re-election." ~ Warren Buffet
"I need two clones, one for managing emails, one for doing research. Then the main me handles the rest of tasks like writing reports with analysis and doing interviews." ~ the Jackass
"Do not become addicted to the water, for it will make you weak." ~ Immortal Joe (new movie "Road Warrior")
## INTRO SHORT SUBJECTS
◄$$$ MONEY VELOCITY IS FALLING DANGEROUSLY TOWARD CLEAR SYSTEMIC FAILURE TERRITORY, IN CONTRAST TO THE FAST RISING MONEY SUPPLY FROM THE DISASTROUS QE MONETARY POLICY... STARK EVIDENCE OF FAILURE FOR THE QE INITIATIVE IS WITHING VIEW... THE USECONOMY IS STUCK IN DEPRESSION, SHOWN IN THE DATA. $$$
The official insanity continues. The QE to Infinity is a massive failure, but desperate backstop for Wall Street banks, a huge backdoor bailout for their toxic bond portfolio. With no critical mass of USGovt debt purchase from investors, the QE had to be put in place, and kept in place. But the QE effect to kill capital is seen in the powerful decline in Money Velocity, as plant & equipment are retired, businesses shut down, and credit extension is curtailed. The banker syndicate cannot stop the QE spew of monetary flow, which has converted the USDollar into a toxic paper. The USGovt debt default would occur within weeks without the bond coverage. So the capital destruction continues, and the economic collapse proceeds toward the conclusion, marked by systemic failure and debt default and launch of a replacement USDollar.
The pathogenesis will continue without interruption. The insanity on the USDollar road stops when the East stops accepting USTreasury Bills in trade, and forces the re-installation of Gold Trade Standard. Then comes the New Scheiss Dollar from the cradle of USDept Treasury. What follows will be a sequence of painful devaluations, and a rapid slide into the Third World. The measure Money Velocity is defined as the rate at which money is exchanged from one transaction to another, and how much a unit of currency is used in a given period of time. Velocity of money is typically measured as a ratio of GNP to a country's total supply of money. Simply put, when the merry-go-round does not spin fast enough, the USEconomy machine collapses. This has been a steady Jackass refrain for over two years, and the indictment against QE for failure. The conclusion lies directly ahead, not in years but rather in months.
◄$$$ MORGAN STANLEY IS IN LINE TO SELL THEIR OIL TRADING OUTFIT TO A US-HEDGE FUND RUN BY TUDOR... SOUNDS LIKE THE PLATT STORY... WALL STREET IS LOSING PLAYERS AT THE TABLE, WITH LESS PRESENCE IN THE CONTROL ROOM. $$$
Depletion of American levers and cogs continues. Investment bank Morgan Stanley has come to an agreement on the sale of its US-based division of oil trade. Their Global Oil Merchanting will change hands to trading house Castleton Commodities Intl, the contract signed. The Wall Street Journal broke the story, which results in Morgan Stanley ceasing to be a mjaor global oil trader. The deal is worth between $1bn and $1.5bn. The sale will be completed in the second half of 2015, subject to approval by regulators in the US and European Union. Earlier attempts of Morgan Stanley to sell the asset to foreign buyers twice were thwarted. The acquisition is not totally complete.
Castleton Commodities International, with Connecticut HQ, consists of a group of investors that includes hedge fund managers Paul Tudor Jones and Glenn Dubin. The trading house will receive contracts and inventory units of Morgan Stanley, with its team of about 100 traders. Morgan Stanley started to sell crude oil in 1980. The firm has the most significant natural reserves related to energy on Wall Street. Recently, however, the volume of transactions fell sharply. In a US Senate report submitted last year, the bank used to charter 100 tankers per month, but last year the figure fell to under 15 per month. See Vesti Finance (HERE) in Russian.
◄$$$ METRO NEW YORK CITY ANECDOTE ON BUSINESS ACTIVITY FROM THE BACK END... POWERFUL USECONOMIC RECESSION IS CLEAR. $$$
Hat Trick Letter client MarkS in Metro New York had an unusual addition to share. The business activity in the Big Apple has dwindled significantly, the measure being highly unusual and not subject to fudging, unless biological rot is considered. He wrote, "I am a 21st Century garbage man. I have been cleaning up other people's crapp for nearly three decades, hazardous waste, industrial cleaning, etc. One of our bigger subcontractors that we partner with from time to time is a permitted transporter and landfill agent. They used to haul up to 300 cans on a daily basis. These cans are roll-off boxes, as in 30 cubic yard dumpster containers that transport special waste. Refer to special waste, as opposed to MSW municipal solid waste. These wastes are from construction and/or manufacturing operations. Well, surprise to learn, that they are hard pressed to move 100 cans per day. Simply put, industry is not producing nearly as much waste because they are not producing as much stuff, not by a long shot. By any metric, that is one hell of a haircut. The recession is very clear and strong." He cites at least a 65% reduction in movement, output, and implied activity, a huge decline in the USEconomy. A society can always be measured, if not judged, by its garbage. The measure joins tax receipts, electricity usage, and freight traffic as good indicators that are difficult to gimmick and fudge.
◄$$$ NORWAY IS REQUIRED BY A NEW LAW TO SPEND ITS NATIONAL NATIONAL WELFARE FUND... THE NORWEGIAN AUTHORITIES WILL HAVE TO START IN THE CURRENT YEAR TO SPEND THE RESERVE FUND... REAL SOVEREIGN WEALTH FUNDS ARE TO BE DISTRIBUTED. $$$
The head of the Norwegian central bank Yngve Slyngstad made the statement. The National Welfare Fund, with funds that approach the $900 billion level, is a safety cushion for the economy of Norway. This year, the authorities plan dispense 3% from the fund, about 164 billion Krone (=US$21.8 bn). The fund is utterly huge, considering Norway only has a 5 million population. At the same time, a sagging regional economy adversely affects the situation in Norway. The unemployment rate at 4.1% is the highest since 2006, although relatively low. Therefore the Oslo Govt is pressed into taking decisive action. The 2014 Fund has earned 7.6% since 2011, which critics claim is poor performance, but in light of the horrendous global financial front, such is not bad at all. See Vesti Finance (HERE) in Russian. Whereas the USGovt, UKGovt, EuroZone Govts all distribute printed money in corrosive inflation as though it is real (when fake money) like Third World African nations such as Zimbabwe, the officials in Norway release their actual savings, which has no net inflationary effect and only benefits.
◄$$$ THE SWISS NATIONAL BANK OWNS $1.1BN IN APPLE STOCK, $620MN IN EXXON-MOBIL STOCK, AND A TOTAL OF $100BN IN ITS STOCK PORTFOLIO... NOTABLY A LARGE AND GROWING PORTION OF STOCKS ARE FROM US-CORPORATIONS, NOT EUROPEAN. $$$
When the Swiss National Bank (SNB) halted the Euro-SWFranc peg a few months ago, a sizeable $32 billion hole was blown in their Euro currency reserves, held in portfolio. As offset, a whopping 18% of central bank assets are held in foreign stocks, surely part of the USD back end hedge from the Gold market short. In fact, more than one third of SNB holdings are in US equities. More specifically, the central bank owns some $37 billion worth of shares in 2548 US-listed companies, up an impressive 40% in sequential quarters. It should be noted that SNB even owns $250 million in FaceBook toilet paper stock, which capitalizes into securities an over-priced rack of disk drives run by nuisance software which enable tracking of citizens with an audible censor echo. The glaring figure is Apple stock, which went from $614.5 million in holdings as of end December 2014, to an outsized $1111.7 million as of end March 2015. Sassy Tyler Durden concluded, "SNB buys AAPL stock and lowers interest rates to force yield starved bond investors to give money to Apple, which uses the debt proceeds to buy back AAPL stock, which boosts the value of SNB's AAPL stock." It is a circular investment, tainted by negative interest rates offered by Swiss banks. See Zero Hedge (HERE). The Jackass cannot unfriend FB since not in their meddlesome network, or in any other network. All invitations are immediately deleted. Thank you. The Jackass will not be tracked like an animal, or herded like a sheep.
◄$$$ DEEP CONNECTIONS COME TO THE FORE, TO EXPOSE THE FACEBOOK FOUNDER ZUCKERBERG AS ANOTHER ROCKEFELLER... A BATTLE FOR CONTROL OF SILICON VALLEY IS UNDERWAY... WAR IN TECH LAND. $$$
The Rockefeller lineage partially explains why FB stock was entered into S&P500 without proper qualification as a stock. For 20 to 30 years, any new index stock in entry had to be in the economic mainstream, have an established business, and have significant revenues with profits. FaceBook did not qualify in any respect, but it surely enjoyed a major lift from inclusion, due to forced investment by managed funds. In what Pentagon sources say was a direct message to the Rockefeller family, a kill event appears to have occurred, even though cause of death has not been disclosed. Dave Goldberg, the Chief Operating Officer of Facebook, died in mysterious circumstances at age 47 years recently. Goldberg is a veteran Silicon Valley entrepreneur and venture capitalist. He joined Survey Monkey in 2009, an online survey that boasted election features one step more accurate than the major pollsters. Facebook is predominantly owned by the David Rockefeller grandson Mark Zuckerberg (described better as an asshole than a nerd). Pentagon sources claim a message was given by the armed forces to the Silicon Valley oligarchs that from now on the high tech industry in California would be under military control. Times are moving way past bizarre. See New York Times (HERE). One must also wonder if the USGovt syndicate dons might wish to control the survey apparatus, rather than to see a more adept methodology prevail. Recall that Senator Harry Reed of Nevada was 5% to 7% behind with one week to go, but won easily in re-election. Control of survey results can tend to reduce suspicion of rigged elections, which are the US norm in national politics.
## THE IMF SDR PLAN & BIG DEBATE
◄$$$ SHILL RICKARDS AND THE NEW IMF-CHINA SPIN MAKES FOR GOOD READING WHILE SITTING ON THE TOILET WAITING FOR NATURE'S MOVE... HIS ASSUMPTIONS ARE MOSTLY WRONG, HIS CONCLUSIONS WRONG ALSO... HE FAILS TO SEE THE RMB AS GLOBAL TROJAN HORSE... CHINA PREPARES THE STAGE FOR A GOLD-BASED FINANCIAL STRUCTURE, WITH CHINESE RMB IN TRANSITION STAGE, THE USDOLLAR TO BE STRIPPED, REMOVED, AND DISCARDED... THE USD IS THE TOXIC WELLSPRING, WHILE THE RMB IS THE NEW TRADE PAYMENT STANDARD. $$$
Superstar syndicate shill Jim Rickards attended some private parties associated with the annual IMF party. Apparently many were the public warnings contained in the open meetings and press conferences, but the private discussions are even more troubling than what is revealed publicly. They surely included the systemic breakdown aspect and universal USDollar rejection theme, return to Gold primacy, bank insolvency, complete with Western dismissal from the helm of control. These secretive discussions included IMF head Christine Lagarde, USTreasury Secretary Jack Lew, and Chinese Finance Minister Lou Jiwei. Summarize quickly the points made by Rickards, who serves his syndicate masters with lies, deceptions, and false directions, as well as incomplete and false justifications all along the path.
Rickards stated the following main points. Greece will remain in the Euro system and a major crisis will be averted despite the public acrimony. The IMF laid the groundwork for including the Chinese Yuan in its reserve currency basket used in its world money aid funds, the SDR. The USGovt is willing to let the Yuan join the SDR basket, provided China continues to peg the Yuan to the USDollar. Doing so will extend USFed monetary policy to China. For now, China seems willing to go along with the plan to join the SDR club. The Yuan should be stronger and Chinese growth slower than many expect in coming quarters. The final secret topic was the fragility of the international monetary system. The IMF is keeping the SDR as reserve in case a new global financial meltdown requires a massive dose of liquidity beyond the ability of tapped-out central banks to provide. Keeping Greece contained is very important. He concluded, "If the IMF needs to break the glass and pull the emergency SDR switch, they want to make sure China is onboard. Solving the Greece situation reduces the likelihood that they will have to break the glass. It is all connected and quite complex." It is far more complex than Rickards comprehends, and far more dire and gloomy for the future USD prospects, as the King Dollar throne is almost broken completely. Rickards is a fast talking salesman of both used cars and snake oil, who defends the current regime.
Some serious deception and misinterpreat is laced throughout the supposed Rickards wisdom in reporting. Let's clear it up. China will seed the entire world banking reserves system with RMB bonds, forcing eventually the diversification away from the USTreasurys. The entire banking system will be seeded, as nations copy the SDR basket concept. This is a gigantic openly visible Trojan Horse. China will continue to further along more RMB trade as the standard, using their diverse platform of Yuan Swap Facilities across the world. The central banks are not tapped out, since they print unlimited phony money. In time China will depeg from the USD, just like the Swiss depegged from Euro, when it suits their needs and objectives. The USD is due for replacement, then heavy devaluation. China will create a gold backed RMB currency, likely to be interwoven with Gold Trade Notes, which soon will arrive. The USFed monetary policy QE has destroyed the global central bank franchise system, evident from seized-up ancillary bond markets and negative rates. The IMFund will go away, a gutted toothless agency, an empty unfunded office. Greece cannot be contained on debt side, as patches only buy small blocks of time. Athens is already turning East, cutting deals, even while prized assets are lost and Russian naval bases are planned. Both Greece and Turkey will be lost to the NATO Alliance. The entire financial strucutre is becoming disconnected. Rickards is a stooge tool shill, who cannot admit the US has no gold, and cannot see the Chinese pushing the USD off the global financial stage. The IMF SDR plan is a key stage for removing the USD, an intermediary step toward creation of the Chinese RMB as the new trade payment standard.
◄$$$ REVIEW SOME OPINIONS FROM THE GOLDEN JACKASS TEAM OF COLLEAGUES... THEY ARE A SMART BUNCH WHOSE VIEWPOINTS CARRY GREAT WEIGHT... THE VOICE SHARED HIS SAGE VIEW ALSO... THE TOPIC IS THE IMFUND PLAN TO INCLUDE THE CHINESE YUAN, THE IMPACT ON THE USDOLLAR AND GOLD... THIS IS THE INITIAL PORTION OF THE GLOBAL RESET. $$$
Begin with Aaron Krowne of Implode-Explode website, a source of excellent information originally with the subprime mortgage bust, but lately on a host of topics. The following are his thoughts, my minor edits. China is setting up one of two options, each with a check-mate of the West and the King Dollar Regime.
Option A: Let the United States have increased control of the Intl Monetary Fund, and make the Chinese Yuan currency (with implicit Gold backing) a significant part of its Special Drawing Rights basket of currencies. Or else take another option.
Option B: The US walks away from the IMFund and makes exclusive use of the Asian Infrastructure Investment Bank (AIIB) and BRICS New Development Bank which have been set up. The US then pegs its currency to Gold (which is only illegal in the IMF), which crashes the USDollar and most all Western currencies.
China may actually have the best interest in shadow pegging the Yuan currency to Gold through the Shanghai Gold Exchange mechanism. That probably makes more sense, because it turns the Anglo-American gold price suppression (another hidden shadow peg) against itself. The result is the Yuan-Dollar rate is permitted to stay low, but without the need for a fiat peg at all. So a potential race has been set up, where the Yuan-Gold starts to fall, and the West has to drop the USDollar as reserve currency and ultimately stop holding back the Gold price versus USD. In the meantime, the USDollar is kept from being pushed up against the Yuan. At a later point (but probably not too far in the future), China's interest would change to raising the Yuan in Gold terms, when it wants to really enable its middle class to consume. It would shatter the Yuan-Dollar peg once and for all, ushering in the new Gold Standard.
EuroRaj comes from the London Financial Centre, but in the last year moved away from the evil hive. He is an expert in the India, Iran, Turkey region, his native area. His wisdom and insights are vast. The following are his thoughts, my minor edits. He would add a few small twists to what Aaron has mentioned, which are fully agree upon.
Plan A: Recognize China as a legitimate global economic force by including China in the SDR (which is a Trojan Horse move), and let them exploit other nations just as the US hegemons have been doing for decades. (a) Once China is included, China will insist on gradually changing the rules, so that the SDR ratios are based on trade or GDP. (b) The above will ensure that the fall in percentage terms of the other four currencies is assured. They are the USDollar, Euro, British Pound, Japanese Yen. Doing so will be very painful for the banking cabal led by the USFed as the USDollar will be the biggest loser. (c) Anticipating this move, trade partners will hoard Chinese Yuan (CNY) and sell USDollar. The peg will be challenged quickly.
EuroRaj believes that once China has a foot in the door, they can detonate the nuclear trigger anytime by linking CNY to Gold, which will force the demise of all fiat paper currencies rapidly. Essentially, by including China within the SDR, the cabal would be signaling that power has been transferred to China with the IMF being a spectator (or tool). Since the United States has bowed and accepted Russia as a potential military force again, which was the sole purpose of Kerry's visit to Sochi in early May, by this autumn the USGovt will be forced to recognize China as an economic force. If the West disputes, disagrees, refuses, drags feet, interferes, and does not want Plan A, then China will resort to a radical Plan B. It features a sudden system blow-up much sooner than thought possible. Sudden death syndrome is the catch phrase.
EuroRaj continues. On a side note, the USGovt stupidly believes that by patching relations with Russia, they can use the failed divide and conquer strategy by now going after China by challenging them in the South China Sea island dispute. A big obstacle exists, more like a well defended brick wall. The China-Russia-Iran axis is very strong, with support from the other BRICS nations. It represents a obstacle the US and Eurozone simply cannot fight militarily or economically. Witness the Western banker cabal being brought down to its knees and the first constructive steps of the Eurasian Union in reshaping the geopolitical stage. My best instinct tells me that disorder will come, and the Plan A will be too difficult to enact. The USFed will most likely be forced to revalue Gold at a price most people today think is impossible. A new local/domestic currency will be launched within the United States and globally all trade imbalances on a net basis will be settled in Gold. The reaction will send shock waves across the USEconomy, which is laden with fiscal and trade deficits, neither of which is fixable in even a three year timespan. The financial market action over the recent weeks signals that some major players are feeling serious pain in the derivative space, across FOREX currency, interest rates, and paper Gold & Silver. Something big is brewing. Smell the Global Reset in the wind, with all the attendant grand disruption.
London Paul comes from the London Financial Centre, and has worked as a private financial consultant for several years. He made a quick comment. For what it is worth, I suspect the SDR option is a non-starter, given the likely time scale,s for any implementation. In any case, I am not convinced there is any real merit to the proposed SDR solution, temporary or otherwise. George of COMEX jungle pitched in, always a different effective viewpoint. China is going relatively slowly as it tries diplomatic solutions first. The US cannot allow them in beyond minuscule player status within the currency basket or commodity (especially Gold) pricing. However, it is difficult to believe China will go past late 2015 in the SDR talks without breaking down the door. Reconsideration occurs once every four years.
The Voice is more direct with an aerial view, having lost patience. His comments, my minor edits. The cattle (US$) are already in the slaughter house and very close to the knocking station where the brain bolt is administered. That moment brings sudden death. Click, slam, game over, the result instant and irreversible. The entire process (meaning Global Reset) has to be done in an orderly fashion to keep collateral damage at an absolute minimum. Chinese decision makers are not known for making rash and stupid moves and neither are the Russians. The US nation has been trashed, gutted, pissed on, and flushed down the toilet. The Elite have succeeded in destroying one of the greatest nations built in most recent history. Then again, all empires die without exception. The US went into decay mode 20 years ago.
The Voice outlined three things will happen this year. 1) Gold holdings will be announced by major nations simultaneously with 2) Inclusion of Yuan in IMF SDR basket. Then 3) Oil and Gold will start trading more aggressively in Yuan (RMB) price. Global trade will be conducted much more broadly in RMB terms. More countries will make diversification moves in order hold up to CHY 1 trillion in reserves within banking systems. This refers to the RMB bond seeding from the IMF Trojan Horse. Stocks will keep rising in China and Hong Kong. Facts will come out that Asia alone is handling half the global trade growth and size, which will make the Yuan exchange rate zoom upward. Expect soon to see first sighting of Gold Trade Note in usage as Letter of Credit formally, like a matter of a few months.
The Jackass has viewpoints and opinions on the IMF, China, USDollar, and Gold all through this report. Let me just say that Rockefeller and Rothschild and Bush worked the plan, with their army of henchmen and major corporations under their control, in the energy sector, the financial sector, and the CIA agency. They wanted to kill the nation, and they succeeded. They have a global totalitarian state plan at work, which has been derailed. The NWO will not happen, but the New Silk Road World Order will indeed happen, better known as the Eurasian Trade Union. The knocking station lies dead ahead, T minus 3-6 months in my book. The United States cannot settle trade imbalances with gold. The USGovt deficit is too big. The trade deficit is too big. And besides, too little gold to devote to the tasks.
The US Elite might have a plan to use stolen Gold to gain the control position in a new currency. But the Jackass believes they will keep the ill-gotten gold and let the US slide into the Third World, later to be colonized by China on a commercial basis. They will choose personal riches in their Carlyle Group gold accounts instead. Therefore, huge devaluation in New Scheiss Dollar comes after its urgent launch, in order to guarantee import supplies without interruption. Then comes a massive foreign investment (commercial colonization), an unspeakable rapid decline into the Third World, accompanied by USGovt debt default in full recognition, and shortages everywhere, much worse than seen in Venezuela. The US nation will struggle mightily to reverse its deficits so that a new currency can stabilize, but at a much lower exchange rate than the majority of analysts believe. Think an effective 50% to 80% USDollar devaluation.
## UNITED STATES AS REMOVED SUPERPOWER
◄$$$ OBAMA OFFERED A MEETING AT CAMP DAVID FOR GULF EMIRATE NATIONS, AND ALMOST NO INVITED PRIMARY LEADER FIGURE CAME... THE WINDS HAVE TRULY CHANGED... THE USGOVT SUFFERS FROM ISOLATION, AS A PARIAH STATE EVEN TO ARABS. $$$
The Camp David summit meeting was supposedly convened to iron out Gulf region differences, and to possibly resolve some oil price issues. President Obama wanted a one-on-one meeting with the new Saudi King Salman. The Saudis said no thanks, as did Bahrain, the United Arab Emirates, and Oman. Four of the six invitees declined in all. Instead, they sent as grand insult their second and third in command. King Salman was the main invited guest to the meeting, but he declined. There is no precedent of such refusals in recent US history. The Bahrain king attended a London horse show instead. The story is not so much the planned agenda of the meeting, which has born very little in press reports. The story is instead the major snub by Arab leaders to a worse than Lame Duck US President. He is a significant irrelevance, a piece of unsightly furniture on the world stage, a head of a pariah state. The United States has lost its prestige, and almost no leaders care what the Washington gangsters wish, plan, order, or do. See Oil Price (HERE).
◄$$$ FIRST STRIKE TRAP SET BY RUSSIA, BUT DONE SO IMPLICITLY, DUE TO EXCESSIVE AGGRESSION BY THE UNITED STATES... A GRAND ERROR IS BEING ATTEMPTED, PUSHED, AND FORCED... A GRAND EXPOSURE COMES. $$$
The United States leadership has lost control, the nation stuck in economic depression, stuck in African monetary inflation, stuck in bank insolvency, lacking industry, with social disorder hitting precisely on schedule as the Jackass forecast. The truth be told, the USMiliaty has lost any conventional tactical advantages. It began with the arrival of the Russian Sunburn and Onyx missiles. The overshadowed weapons were adequately demonstrated by the Russian Military in the Black Sea recently, the superiority with key weapons and systems like making naval target systems go blind. The United States banker-led Govt is cornered financially by the toxic USDollar and ruinous monetary policy. The Washington crew display an utter desperation to keep Russia disconnected from Europe, but it will not work. The Ukraine War theater is failing on all fronts. Therefore the braindead fascist Neo-Con (nazis) in charge conclude that the US can prevail with a first nuclear strike at Russia, then take control of their entire nation's vast natural resources. The lunatic fringe has gone central.
The strategy will surely fail, expose the US fascists, and result in massive backlash. On at least three and possibly as many as five occasions, the US President has given orders to deliver a nuclear strike against Russia. In all cases, the Pentagon Generals and Admirals have disobeyed orders. The result has been a few summary dismissals, with more early retirements, complete with hefty salary and opportunity to join the First America movement of exited high rank brass. If the USMilitary continues in this direction, eventually a first strike might actually be launched. It will bring about the end of the USGovt as it is known. The result will be complete US exposure, US isolation, US quarantine, severe retribution against the USGovt leadership clan, following a tremendous backfire against Washington. The usage of advanced technology by Russia will prevent the strike from hitting their country. Their defense systems are very advanced and have been fortified by some extraordinary devices. The backlash will be horrendous for the United States, but the exposure of the criminal elite syndicate for their heinous deeds will be refreshing.
◄$$$ JAPAN PM SHINZO ABE TO BE CHARGED FOR ELECTION RIGGING AT THE HIGH COURT... DELAYS UPON DELAYS HAVE OCCURRED, BUT A TEST OF FIRE IN COURT MIGHT FINALLY ARRIVE... ABE IS A USGOVT TOOL WHO (WITH WESTERN AID) RIGGED THE ELECTION IN TRUE AMERICAN STYLE. $$$
A group of plaintiffs have filed election protests against the Japanese Prime Minister Shonzo Abe, who sits in his office as a result of massively rigged elections. The High Court of Japan displayed very dishonorable conduct, uncharacteristic in Japanese setting, by employing hundreds of police personnel who restricted cameras outside the courthouse building. Just two months ago, a different high level court suddenly dismissed the entire proceeding, apparently since it was too ugly, too corrupt, and too pressured by the ruling elite scum in charge behind closed doors. This time around, the opponents appear more prepared for a fight of justice. The plaintiffs presented the following damaging connections:
1) Voting Machines are manufactured by Musashi Engineering
2) Musashi Engineering is controlled by New York based Fortress Asset Mgmt
3) Peter Briger, Jr (Fortress CEO) is a member of the Rockefeller Trilateral Commission
4) PM Shinzo Abe (the defendant) is a major stockholder of Musashi Engineering.
The true sentiment of the Japanese people comes through clearly, toward their government in relation to the United States controllers. Japan is an occupied nation, a nation whose banking and politics are under complete tight control by Washington and Wall Street. In one particular video clip, a witness has come forward. He is a computer programmer who admitted in court about his authoring of the program used in rigging the US elections for the Bushes. That information will never see the US press. See Geopolitics (HERE). Yet another unsavory US export, to be sure. Like with the US White House, somebody must take out the trash at the top.
◄$$$ THE PENTAGON'S LONG WAR WITH IRAN HAS POOR PROSPECTS OF SUCCESS STRATEGICALLY... IRAN IS GRADUALLY JOINING THE EURASIAN TRADE ZONE FROM THE SECURITY SIDE DOOR AND CHINESE MAIN CORRIDOR... THE USGOVT IS INCREASINGLY IGNORED ON THE GLOBAL BATTLEGROUNDS... THE EASTERN CARAVAN MARCHES ON, EXPANDS, AND SOLIDIFIES. $$$
Despite the apparent pacified intentions on display during the nuclear negotiations this summer, Iran as well as Russia will surely remain key US geostrategic targets. The US camp tried to dismiss the event, but the Russian sale of the S-300 missile system to Iran is a monumental agent of change on the geopolitical security chessboard. The Tehran camp has boasted that its Iran-made Bavar 373 could be even more efficient than the S-300 from Russia. The prestigious Jane's Defense Weekly has been on record for years claiming that Israel could not penetrate Iranian airspace even if it managed to reach their border. In addition to the S-300s, Iran will likely be offered additional sophisticated S-400 missiles, which are to be delivered to China as well. The so-called Long War was first formulated in the Axis of Evil era by the Highlands Forum, a relatively obscure Neo-Con infested Pentagon think tank. It should be noted that the scummy diabolical RAND Corp is a major partner.
The Neo-Con warmongers are firmly in charge, their handiwork seen in Ukraine and Syria. War is their main calling card. The notorious Long War practitioners such as Pentagon top warrior Ash Carter, deputy Robert Work, and Pentagon intelligence chief Mike Vickers are in charge of the Obama Admin military strategy. The Pentagon micro-mind arrogant team has not noticed that Moscow and Tehran easily identify the power play. Laughably, the hidden USGovt agenda of manipulating a rehabilitated Iran to sell oil & gas to the EU, thus undermining Gazprom, is a non-starter and failure. They operate with pipe dreams, called strategy. To be sure, Washington will never secure the Middle East with Iran as a vassal state, unified with the West so as to confront the Russian threat. The lesson learned in this Iran chapter is simple. The Pentagon barks, but the strategic caravan from Russia, China, Iran goes on. See The News for the Pepe Escobar essay (HERE).
◄$$$ CHINESE RMB HUB OPENED IN CANADA LAST MARCH... THE BENEFITS ARE HUGE, FOR MUTUAL WINS... CANADA HAS A LEG UP IN THE AMERICAS... THE UNITED STATES WILL NOT HAVE A REAL WORKING RMB HUB, BUT LOS ANGELES MIGHT EVOLVE INTO ONE. $$$
The new Renminbi Hub opens Canada-China trade relations to a new level. The first RMB Hub in the Americas opened in Canada in March. It features currency conversion and bond issuance. Business will see promotion from facilitated trade in the Chinese currency. In late 2013 the Chinese currency overtook the Euro as the second most used currency in trade finance, with the USDollar holding first place. The RMB is seen as more stable in trade since the global financial crisis began in 2008. The advantages come four ways. 1) More trade is encouraged with China. The Asian superpower is Canada's #2 trading partner, with exports to the country totaling over $77 billion in 2014. The RMB Hub will make transactions more efficient and easier for Chinese clients. Expect trade volume to rise, as well as stronger business partnerships between the two countries. 2) Reduced cost and time savings are to result. Avoiding slower two-step USD transactions has clear cost savings. No conversions to USD or British Pounds will be required, which sometimes involve London or Singapore. The added layer of currency cost is avoided, along with bank and agent fees. Companies can diversify away from the USTreasurys, and thus better manage foreign risks.
3) Competitive advantage for Canadian companies is realized. Being the first and only RMB Hub in the American Hemisphere will give the nation a big advantage at the origin, from the bidding process. The many Canadian companies will be at even keel with those in other hub trading areas such as Australia, Germany, and the United Kingdom. 4) Benefits are to come to commodity sectors. The majority of Canada's global exports to China are commodities, such as metals and agriculture. The growth of the Chinese middle class will trigger continued increases in demand for finished products and other higher profit items from Canadian sources. Expect also an expansion of new lines of RMB-related products for trading in Canadian equities, commodities, and futures markets. The Export Development Canada (EDC) has aided future prospects by issuing its third RMB bond in March 2015, at a value of RMB 1 billion. See Export Wise (HERE).
◄$$$ WITNESS DESPERATION WHICH PRECEDES A ROOM TRAMPLED, AND POSSIBLE OBSOLESCENCE... THE COUNCIL ON FOREIGN RELATIONS GRAND STRATEGY: CHINA MUST BE DEFEATED, THE TRANS-PACIFIC PARTNERSHIP IS ESSENTIAL TO UNDERMINING CHINA. $$$
The Council on Foreign Relations has issued a new report, which displays in full view the United States as hegemon. The report is entitled "Revising U.S. Grand Strategy Toward China" and was introduced by Richard Haass, the council President. It expresses disappointment that China has failed to live up to global leadership status. The report opens in arrogance by stating, "Since its founding, the United States has consistently pursued a grand strategy focused on acquiring and maintaining pre-eminent power over various rivals, first on the North American continent, then in the Western hemisphere, and finally globally. [It lauds over] the American victory in the Cold War." It then lavishes praise on America's imperialistic dominance. Vomit bags were not handed out with the report. It reads like a declaration of war by America's aristocracy, against China's aristocracy. It urges the USGovt to ramp up spending in order to challenge and halt the rise of China. The entire report is effusive and highly objectionable, seemingly out of touch with reality. Worse, it displays how the US Elite are out of touch with the Global Paradigm Shift and the move away from central power toward distributed global power. The exceptional nation will be corralled. The Gold Standard will make the CFR obsolete, if the USGovt debt default does not first. See Global Research (HERE).
The Voice wrote in response. "It only demonstrates how far removed these people at the CFR are from reality. It has been 70 years since WWII and there is now another bunker mentality syndrome at work. However, this time the center of attention is in Washington DC and New York City. The Washington helm has gone farther from diplomacy and emerged more reliant upon war to defend its turf and its entire system, which is crumbling. The US power structure is being undone by failed policy, bond fraud, excessive controls abroad, abuse of power, and aggression." He has stated numerous times that the TPP trade union will never go anywhere, never find critical mass, and become an embarrassment.
## BOND BUST SIGNALS COLLAPSE
◄$$$ THE USTREASURY BOND MARKET IS DEAD... IF IT IS WALKING, IT WALKS TO THE SLAUGHTER HOUSE... IT IS RUINED BY USFED MONETARY POLICY... QE KILLED THE USTBOND MARKET, WHOSE DEAD FEATURES ARE EASILY IDENTIFIED... THE USTBOND MARKET IS COMING TO REALIZE ITS LIMITED TIME BEFORE SUNSET, THE SYSTEMIC RISK RISING QUICKLY... IT HEADS FOR CERTAIN REJECTION THEN DEFAULT, WHICH IS A SEED GROWING IN GLOBAL AWARENESS. $$$
- USTreasury Bond market volume is down markedly to danger levels
- USFed is the principal buyer, lapping up all paper sold
- USFed soaks up Indirect Exchange in the $billions for foreign asset purchases
- USFed uses fake money to cover hidden derivative losses in the $trillions
- USFed balance sheet has turned toxic, with cancerous growth
- REPO market dried up, stuck in reverse
- Dollar Swap market dried up, stuck in reverse
- Negative interest rates at big banks, stuck in reverse
- Yields are hyper-sensitive with no stability, due to diminished liquidity
- Money market funds are a wasteland with no returns given
- Hidden Petro-Dollar damage from dismantled derivatives
- Strain to the primary bond dealers (surprised not all dead yet)
- Strain to pension funds and insurance companies, stuck in mud.
The USTreasury Bond market lies at risk, not from deflation or removed QE bond purchase initiative, but from systemic risk. The USDollar is due for a global rejection that the USGovt denies, Wall Street will not discuss, US investment public does not recognize, and Western analysts refuse to acknowledge. The USFed is the USTBond market, a radical obscene travesty. Bond yields were taken ridiculously low in 2012 from QE and Interest Rate Swap machinery, under the 1.5% yield level. The Taper Talk created the bottom, but formal discussion of halted QE initiative was a bold lie, a basis trial balloon to test the systemic reaction. It was a horrible reaction. The major bond yield declinefrom 2014 was from heavily applied renewed QE which was joined by other major central banks. Witness the reversal which really began before USFed Chair Yellen warned of an overbought UST Stock market, and before bond superstars like Bill Gross made similar warnings. The USTBond market is undergoing early shock waves from a late recognition of three factors. 1) The QE cannot go on forever, since an artificial prop. 2) The USTBond market is the last great American asset bubble. 3) The USDollar is to be rejected on the global stage, replaced at first by the Chinese RMB in trade, and then by the Gold Standard. Conclusions are clear. With the USD sunset, the USTBond will be negotiated at the default table. That concept is but a seed, which will grow, and has certainly begun to germinate.
◄$$$ USFED HAS WARNED ON STOCK MARKET DANGERS BUT IGNORES BONDS, IN A COMICAL DISPLAY OF DISTRACTION OR INCOMPETENCE... THE ARSONIST WARNS OF DANGER TO THE NEIGHBORHOOD... BONDS CONTAIN HEAVILY LADEN CURRENCY RISK FROM THE TOXIC USDOLLAR. $$$
All US$-based financial vehicles are at great risk of heading to lower value. That includes the USDollar, USTreasury Bonds, and US stocks as represented by the S&P500 index. The clown USFed Chair Janet Yellen cannot seem to come to grips with the painted corner the central bank is stuck in. She made some cautious comments during a conversation with IMF managing director Christine Lagarde in a conference in Washington DC. Yellen stated, "I guess I would highlight that equity market valuations at this point generally are quite high. They are not so high when you compare the returns on equities to the returns on safe assets, like bonds, which are also very low, but there are potential dangers there." She openly called bonds safe, when QE has destroyed the market, rendering USTBonds mere African toilet paper with 3W patterned inscriptions. For almost nobody in the mainstream to see any downside risk in owning bonds surely makes them the asset class with the greatest potential hidden danger. The trade has become horribly one-sided, with the USFed and other major central banks on the buy side. The bond market is thus broken. One should be aware, as Yellen warned, that the USFed eventually will cash in equities (big stock holder) to protect the bond bubble. They with the Wall Street lieutenants are soon likely to force a correction. Shocks come. The first priority for the Elite is bond preservation to maintain control of the debt-based system. Stocks are bread for the minion masses, driven down by the market makers and manipulators on orders by the elite in convenience gestures.
Bonds carry credit risk inherently. The risk of a default is minimal in the case of USTreasurys, while the USFed stands ready to backstop the government with its printing press. Unrecognized is the bond risk associated with the USDollar currency. If foreign nations, in particular producing economies, refuse to accept the USD in trade transactions, then the USTBond will quickly lose tremendous value. A global rejection would require US-based businesses to bid up the Chinese RMB, or buy Gold Trade Notes, or bid up Gold itself, in order to conduct trade. The USDollar and its observe USTBond would find themselves destined for the trash heap, the dustbin, the history books. The risk to the USD/USTB is sudden obsolescence. In fact, QE as monetary policy guarantees the death of the USDollar as currency, since it is Intensive Care with no hope of recovery. It should be noted that the sage players, all major bond guys like Bill Gross were recently quoted as saying the bond rally was over. It is done. They see the giant cracks and one-sided alignment that contradicts the market concept.
All the talk about inflation, deflation, disinflation, and reflation is absurd and stupid, a grand distraction to the real risk, that the USDollar faces global rejection and sudden replacement. The Gold Standard is returning, by utter necessity. All the talk about valuations, projected earnings, and forward guidance is almost laughable, especially cash on the sidelines and repatriated corporate cash. Their calculus includes ridiculous assumptions, loads of one-time exclusions, and derivative gimmickry on the books, even heavy foreign subsidiary components. The basic Fed Valuation Model is a joke, based on current interest rates supported by QE itself. Their benchmark comparisons are against rigged markets. All the talk about return on investment and safe haven is pure rubbish, a grand distraction to the real risk, that the USDollar has transitioned into a Third World globally endorsed and supported by hyper monetary inflation of the worst kind, unsterilized. All the talk about ample credit, adequate liquidity, and tradeable markets is moronic and bizarre, a grand distraction to the real risk, that the financial markets are all both rigged and no longer markets at all. The USFed has become the buyer of US$-based securities across the entire spectrum. The USFed is the garbage man, the toxic swill vat owner, and the HAZMAT guy without a suit.
The USTreasury Bond is an IOU piece of paper with a wrong debt rating. As debt, it will never be repaid. It poses as money in a topsy turvey upside down world, where the banker elite run the show, make the rules, wage the wars, kill opponents, paint the news, justify market moves, suppress prosecutions, and print themselves $trillion gifts. A bond is not an asset, not really, not anymore than a debt marker was for Al Capone. Corruption was simpler in that era. Mike Gleason concluded aptly, "A bond does not represent real assets or revenues. It is just an IOU. As such, the most conventional bonds can deliver to investors who hold them to maturity is a fixed quantity of compounded interest. The only way that a 10-year note issued at today's low rates will deliver positive inflation beating returns is if inflation stays lower over the next 10 years than it has over any other recent 10-year period. If inflation rates move up to the double digits, bondholders will get slaughtered. That is the potential danger Janet Yellen is not talking about." Gleason should address the QE risk and global risk more.
The Jackass reminds that Yellen does not mention the more immediate risk, of global USDollar rejection. It is happening right now, the evidence surrounds the globe to see. The bonafide safe haven in the current environment continues to be physical precious metals, recognized in the East, ignored in the West. Gold & Silver coins owned free and clear carry no counter-party risk and no risk of default or bankruptcy. The longer the time period held for the precious metals, the more certain that the metals owned will prevail over inflation. The Jackass adds the Gold & Silver will survive any powerful global financial storm, especially one involving a USDollar rejection and reinstallation of the Gold Standard. The USTBonds will be severely downgraded, devalued, and destroyed. Those who focus on the inflation rates alone miss the big picture and the Global Paradigm Shift. The USD/USTB toiletry tandem is going away, the writing vividly clear on the wall. See Money Metals (HERE). The French hold toilet water in high regard, but the USFed has tarnished the concept with its unending toxic liquidity, the scent of acidic feces in the air.
◄$$$ THE USFED IS USING DERIVATIVES AND FORMAL VEHICLES TO INTEGRATE THE BOND MONETIZATION SCHEME... IT SEEMS LIKE QE HAS BEEN EXPORTED AND INTEGRATED GLOBALLY, USING SEVERAL FRONT OFFICES UNDER CONTROL... A VAST NEW LATTICE WORK IS UNDER HIDDEN CONSTRUCTION... THEY INVOLVE PERMANENT RECIPROCAL CURRENCY ARRANGMENTS, WHEREBY FOREIGN OUTPOST CENTRAL BANKS TAP DOLLAR SWAP LINES TO INVEST IN USTREASURYS... WITNESS EMERGENCE OF THE BLICS (NOT BRICS) NATIONS, A NEW PROXY ENTITY... QE IS BEING EXPORTED. $$$
USEconomic growth has been both a fraud and a fallacy since 2007. Both Zero Interest Rate Policy and Quantitative Easing serve as life support in a bizarre episode from the Twilight Zone which has merged with our reality. The US Federal Reserve is using 17 central banks working in concert through currency swaps to maintain the fraudulent monetary system, which are probably tied into Forward Rate Agreements (FRA) and Interest Rate Swap derivatives between central banks. Chris Hamilton states, "QE is when the USFed and USGovt stepped in and took over the economy in order maintain asset values. The USFed and USGovt intervened in markets to artificially increase asset prices and create [if not] enhance the wealth effect for unsuspecting sheeple masses. The global govternments and central banks began their debt binge to postpone the inevitable crash, kicking the can down the road. The landing strip is fast approaching and the plane's nose is down, but the plane's landing gear wheels are not. What comes is a crash of epic proportions or a statist market take-over, or possibly a market holiday where asset valuations are politically determined and set by controlling governments." The end of free markets occurred long ago. Next comes the end in a politically stamped and approved openly visible process. QE is the US Politburo window on a controlled financial economy.
In the last three years, tremendous distress has befallen the USTreasury Bond complex. If not the London Whale event, or JPMorgan bankers leaping out of buildings, or the Belgium Bulge of $420bn in USTBonds exposed, it has been misdirections like Operation Twist to conceal the vast shifts behind the USFed walls. Legitimate buyers of USTBonds have largely vanished. Taking their place is the main QE window, JPMorgan derivative machinery, Wall Street carry trade, and hidden BLICS hands. The USFed has exported QE while it claims to wind it down. The criminal banking syndicate has been integrating the USTBond purchase program to new proxy fronts. The TIC Report reveals their identity, all friends to the fascist state. Notice the huge decline in official bond holdings by the typical traditional former allies. No more!
The hidden evidence is coming to the fore. The challenge is to identify which entities are buying USGovt debt in the form of USTreasury Bonds. The USFed is no longer permitted to purchase additional USGovt debt issuances due to its ownership limits, unless it changes the portfolio rules. In recent months, six nations have been carrying the load of maintaining USTreasury yields at ZIRP. Those nations are Japan and the BLICS: Belgium, Luxembourg, Ireland, Cayman Islands, and Switzerland. The source of data is the Treasury International Capital (TIC) Report provided by the Federal Reserve itself. The only remaining source of USTreasury debt securities purchasing, and subsequently the only source of US GDP growth, comes down to just Japan and BLICS nations. The USGovt and USFed have conspired as a Ponzi Scheme, using digital counterfeit to purchase perhaps all net new USTreasury debt since July 2011. QE has been exported in a nest of lies.
Hamilton makes several conclusions regarding the massive project over the last few years. It is the USFed's backdoor QE initiative to conceal the QE to Infinity (as Jackass describes it). They use central bank currency swaps principally. He asserts the following. Excellent intrepid work by Chris Hamilton, in his Hambone's Stuff. See Economica (HERE).
1) Fed likely uses off-shore locations to maintain continued USTreasury buying because of limits established by Ownership Limit rules.
2) Fed created currency swaps to provide USDollars to other country's central banks.
3) In December 2007, the Fed's FOMC (Federal Open Market Committee) announced it had authorized temporary Reciprocal Currency Arrangements (central bank liquidity swap lines) with the European Central Bank and the Swiss National Bank to provide USDollars to these central banks.
4) By April 2009 the swap lines were extended to 11 more central banks including the Banks of: England, Japan, Australia, Brazil, Canada, Mexico, South Korea, Sweden, Denmark, Norway, and Singapore.
5) The Fed has maintained that these swaps are not being utilized, in steady lies.
6) In October 2013, the Fed and its recently partnered 13 central banks announced that the existing temporary liquidity swap arrangements had been converted to standing arrangements that will remain in place until further notice. In other words, the temporary currency (liquidity) swap arrangements between central banks became permanent until further notice in October of 2013.
◄$$$ WORLD'S CENTRAL BANKS HIT THE PANIC BUTTON IN EARLY MAY... ONCE AGAIN THEIR ACTIONS ARE PROVING THAT ALL WESTERN MARKETS ARE RIGGED... BOND MARKET BAILOUT IS CONSTANT, CONTROL IS UNIVERSAL, USING DERIVATIVE PROPS, A TRUE DISAPPEARANCE OF MARKET ITSELF... THE USTREASURY BOND MARKET HAS BEEN EFFECTIVELY DESTROYED, THE CONVULSION PHASE HAVING BEGUN... STIMULUS IS A POTASSIUM OVERDOSE THAT CAUSES CARDIAC ARREST. $$$
May 7th will go down as an important date. It is when central bankers hit the panic button. The reaction to USFed Chair Yellen over-valuation comments, to expert comments on the bond game being over, on astute opinions that the bond market is broken, on numerous analyst statements that QE to Infinity is the rule and no policy exit (Jackass forecast in 2011) has rattled the global bond markets. Take away the USFed, the Euro Central Bank, the Bank of England, and the Bank of Japan and the sovereign bond markets would begin to collapse in one or two months. A veritable panic would set in across the globe. Tyler Durden summarized, "If there is one thing more worrisome for the world's central planners than a stock sell-off, it is a bond rout proving that they have lost control. The overnight carnage across global bond markets appears to have triggered someone to step in with dramatic size to rescue bonds and save the world once again. [The rout occurred in both the USTreasurys and German Bunds.] What is becoming increasingly clear to the central bankers, as we noted earlier, is that since the bond market is now massively illiquid and everyone is on the same side. There is no way to orchestrated a controlled decline." See Zero Hedge (HERE). The USFed painted itself into a policy corner with no remaining options except to export QE to vassal central banks, to lie about normalcy, to distract with deflation talk, and to wage war in USDollar defense. Witness the convulsion phase having begun.
The bond market supports the FOREX currency systems and government fiscal situation. While stocks are a sideshow, bread for masses, the bond market is the central core to the financial systems. It is the debt foundation. The many bank derivatives link together the bonds through interest rate devices to important commodities like gold and oil. There is nothing to stop the central bankers from more urgent rescues, more patches, more rigging in the markets. The economic collapse from rising cost structure, vanished profitability, the constant threat to working capital, is assured. QE kills capital, the most reckless of all monetary policy, which is permanently fixed in place. Witness the death process, of working capital, its pathogenesis. The institutional bust from low interest rates will succeed in killing both the pension and insurance industries. The glaring report card item is how Money Velocity is down 50% from 2007-2008.
The Politburo bosses boast of keeping down the Gold price, while they have killed both the bond market and the tangible economy. The collapse is just a matter of time. The cracks are now visible, the liquidity having largely disappeared. The entire global economy is gradually turning insolvent. Not sure many people (let alone analysts) comprehend the consequences of official hyper monetary inflation used to cover deficits. QE kills all. The system has begun the critical convulsion phase. And the leadership crew call QE stimulus. True, it stimulates rapid death and systemic failure in a slow action powerfully corrosive phase. Claiming so is hardly rhetoric as evidence abounds.
◄$$$ VIOLENT BOND MOVES SIGNAL TECTONIC SHIFTS IN GLOBAL MARKETS... THE USUALLY STABLE STAID GERMAN BUND MARKET HAS REVERSED, FROM A NEAR ZERO YIELD ON THEIR 10-YEAR BOND TO CAPTURE THE WORLD'S ATTENTION... THE TOP IN BONDS IS IN, THE TUMULT TO FOLLOW... FOCUS ON DEFLATION IS WRONG FOOTED, WHEN FOCUS SHOULD BE ON HYPER INFLATION, DEMISE OF FOREX PAPER CURRENCY SYSTEM, AND RETURN TO THE GOLD STANDARD... THE BOND MARKET CONTINUES TO IGNORE SYSTEMIC RISK... ENORMOUS TRAGIC LOSSES ARE COMING, AS THE SOVEREIGN BOND MARKET IS THE FINAL ASSET BUBBLE. $$$
The first week of May was a watershed event. The bond markets at major industrialized nations encountered a maelstrom, suffering sudden selloffs, noting unusual air pockets, with a realization like Wily Coyote of being suspended above a chasm with nothing to stand on. A wave of turmoil is suddenly sweeping through sovereign bond markets, setting off the most dramatic gyrations seen in recent years. The USTreasurys and German Bund 10-year yields showed clear damage, the UKGilt and EuroBonds as well in lockstep shakeups. Yields on German 10-year Bunds spiked with unusual volatility by almost 20 basis points to 0.78% in early trading on Thursday May 7th (whose date will be remembered as a wake-up call). Funds scrambled to unwind the so-called QE trade. The effect on USTreasurys was felt the following Monday May 11th in the US bond markets. The powerful ripple effects reached Japan, Australia, and Brazil.
Prepare for a global bond meltdown, unless the USFed and its Exchange Stabilization Fund machinery is put into overdrive using all derivative hands on deck. However, amplified QE activity will hasten the USDollar rejection and dismissal as a valid reserve currency under African monetary management. The long trade vanished since the incredible 0.07% yields posted in the 10-yr Bund only two weeks before. For German Bunds to be near 0% in yield is pure insanity and an indication that the Draghi EuroCB is out of control incompetent. It also means the German Bund is used too universally as the safe haven. The sovereign bond markets are utterly destroyed, the damage to be seen in coming months. Disruptions of this magnitude are extremely rare in major government bond markets. Investors are nursing almost half a $trillion in paper losses in two weeks. For a generation, the German Bund has been regarded as the most safe secure staid conservative bond in the world. It has been the traditional rock-solid repository for institutional investors. No more. The Germans have been forced to join the carnival of toxic policy led by the USFed and Euro Central Bank. The yields still are absurdly low. Many more panicky days are to come.
Without doubt or debate, the greater vulnerability lies in Southern Europe sovereign debt, since they debt picture is atrocious collectively. Fiscal deficits, raging recession, and obtuse tax and pension policy offset a lack of industry in PIGS countries. The French, Italian, Spanish, and Portuguese bonds have all sold off sharply over the same two weeks. Recall the rally by the morons and junkies in recent months following the supposedly good news from the Euro Central Bank, as they unveiled a bond purchase program of EUR 60 billion a month in January. The smart money was stupid money after all, locked in a toxic vat, trusting a Prince of Paper, proving all to be fools. They should be buying up cheap Gold & Silver, but they are addicted to paper. The so-called experts rant and chant about the absence of a favorable macro-economic climate to drive yields higher, in a typical reflationary recovery. They typically focus like myopic fools on inflation expectations, led by Greenspan and Bernanke in such deluded thought. The high priests have taught the masses poorly. They are focused on the dead wrong factor. The real factor is the demise of the entire FOREX paper currency regime, whose sovereign bond support structure is the Zimbabwe hyper monetary inflation known as the QE stimulus, and whose backdrop is endless $trillion deficits with no feasible finance mechanism. There is no reflation story, only hyper inflation, which ordinary would breed 10% bond yields. The bond market is a wrecked field. Witness the mass delusion and madness.
The QE policy is a veritable death sentence for the USDollar, and in turn the entire FOREX regime. See the similar reversal from stupid low bond yields on the Italian Govt Bond. The nation has EUR 1 trillion in unpayable debt, growing worse by the month. Then again, money is free, and central banks are covering the debt in pure insanity. The phenomenon is seen across all the PIGS nation debt markets, except for Greece. In a very real sense, the Euro Central Bank is the PIGS sovereign debt market. The national economies are broken, their debt structure broken, yet demand from Euro QE is strong. Insanity prevails, but reality will soon bite. The worm turned, the windows shattered, the barn doors broke off, as the bond mavens and investor gurus began to speak ill of bonds. Their words broke the underpinning of the sovereign bond foundation, which the Jackass has been castigating and criticizing for two years. The EuroCB has taken the opposite side to institutional bond shorts. The bond king Bill Gross (at Janus Capital) declared that Bunds had become unhinged and were the short of a lifetime. Soon afterwards warning came from Warren Buffett (of Berkshire Hathaway) that bonds were very heavily overvalued. The USFed Chair pitched gasoline on the fire, not to be left out. Janet Yellen, responsible for continuity of QE destructive policy, issued an implicit warning that Wall Street got ahead of itself and might be vulnerable to monetary tightening. Even her warning was half fiction, since QE cannot ever be halted.
The sharp moves have been exacerbated by a lack of liquidity as traditional dealers withdraw from the market to comply with stricter rules, and ordinary bond investors had vanished. They have been selling their over-valued bonds to the mindless Euro Central Bank for years. Suddenly the expert think tanks discuss the absent liquidity in sovereign bonds, the removed risk, and the official props. They describe symptoms of a destroyed bond market, which in no way seeks equilibrium of Supply versus Demand, and in no way seeks proper valuation as extension of risk, inflation, and death of the FOREX system. Expect the bond panic to subside, the effects of the mini-crash shrugged off, and more panicky days in coming weeks and months. Nothing has been fixed, and the financial markets are all rigged or propped.
The German Bund is quite an interesting story. While not a complete discourse, some facts are notable. Bunds became the popular trade as the German Govt prepared a budget surplus sized at 0.5% of GDP this year, eliminating roughly EUR 18bn of existing bonds. Reduced supply meant pressure for higher bond principal value. It quickly degenerated into a momentum trade. German yields continued dropping below zero as far out as eight years in maturity. The usual deflation scare abated. The EuroZone, led by the German juggernaut, managed to squeeze some growth. Yet no recovery is evident in a broad sense, only a local German sense. The absence of EuroZone Economic growth means money seeks safe haven, rather than business investment and capital outlays. Barclays believes the moves in the Bund market threaten to repeat events in Japan in 2003, when 10-year Japanese yields rose 110 basis points in six months after touching unprecedented lows on deflation fears. Investors were left facing sudden outsized losses, not often seen in the staid bond markets. No broad recovery is to occur, so expect more reversals, as investors hunker back into bonds again, only to suffer other shocks. See the UK Telegraph (HERE).
Almost nobody is talking about demise of the entire FOREX regime. A golden sledge hammer is coming to the entire financial stage, quickly converting to a massive golden wrecking ball. The entire set of sovereign bonds has become the final asset bubble, all linked from the major windows to the minor windows, by the governing central banks. These bonds will all be converted to Gold bullion by central banks and sovereign wealth funds in a mad rush during the next couple years, in what will be best described as a cross between a tragedy and comedy.
## SYSTEMIC BREAKDOWN AT WORK
◄$$$ WITH BANKS STILL TOO BIG TO FAIL, ANOTHER OBVIOUS FINANCIAL MELTDOWN LOOMS... NO REFORMS, NO REMEDY, NO LIQUIDATIONS HAVE OCCURRED... PREPARE FOR A BROADER SYSTEMIC BUST, COMPARED TO THE SOMEWHAT ISOLATED LEHMAN EVENT... ALL BIG BANKS ARE LASHED TOGETHER, WHICH PUTS THE ENTIRE BANKING SYSTEM AT RISK WHEN ONE FAILS NEXT. $$$
Nothing has been remedied since the 2008 Lehman collapse marked the beginning of the global financial crisis. Many of the conditions that led to the near collapse of the US banking system endure, warns a new report from the Corporate Reform Coalition (CRC). In fact, most extreme imbalance conditions and distorted leverage locations are more extreme and more distorted in 2015 than they were in 2008. The banks are still too big to fail. Regulators have failed to make sufficient progress on key components of the Dodd-Frank Wall Street Reform and Consumer Protection Act, or to boost transparency in political spending. The Wall Street banks resist all reform, water it down, or delay its enactment. All top six bank holding companies have grown in size. All are still permitted to put on leverage in great multiples of their current assets. All are still dangerously interconnected. All still use bank deposits to engage in high risk derivative transactions in the US and foreign markets. When malfeasance is identified and dealt with, the shareholders pay the costs, not the corporate executives responsible for the misdeeds. Hardly a single item of systemic perversion from 2008 can be identified as improved. Most are actually worse, with a ZIRP & QE tight bandage wrapped.
The report concluded that if any one of these giant banking firms fail again, the damage will likely not be contained. The will of federal regulators is called into question to use the new powers granted in the Dodd-Frank Wall Street Reform and the Consumer Protection Act. A more severe crisis awaits, since the regulators continue to be beholden to the banks. When the bigger crisis hits, it will surely be systemic, as in a broken USTreasury Bond market, made apparent by its ancillary support niche markets. Jennifer Taub, author of the report and professor of law at Vermont Law School, offered several suggestions that make too much common sense, but will surely never be enacted into law or enforced from current law. It is matter not only of transparency, but of law enforcement. Wall Street acts like a crime syndicate, with its own intimidation, coercion, and extensive criminal activity. It even has its own police force, an appendage of the New York City Police Dept and Federal Reserve security system. See Common Dreams (HERE).
◄$$$ ACCORDING TO THE BIS, WORLDWIDE FINANCIAL CRISES HAVE BEEN AMPLIFYING BOTH IN OVERALL MAGNITUDE AND RELATIVE TO REAL ECONOMIC CYCLES... THEY INDICT THEMSELVES FOR SYSTEM RUIN. $$$
The Bank For Intl Settlements has issued a report which curiously indicts itself, for its role as grand bank master. The financial crises can be measured in what appears like a sine wave with growing amplitude. The controlled monetary system is inherently broken, subject to frequent crises. The fact that the next crisis is much deeper than the previous implies the system is broken, living on borrowed time and fake money and stretched limits. A series of recent studies has concluded that the amplification of financial crises has been due to greater financial integration and the propagation of financial shocks through highly networked and mutually interconnected systems of banks. This mechanism also creates a feedback from the financial crisis to the business cycle, exacerbating economic recessions. In others words, the total control has resulted in total collapse, under their aegis, their canons, their directives, their hegemony rule. The BIS is the super bank master, and thus has kept order, but not prevented ruin.
In the chart, Financial Cycle is as measured by frequency-based (bandpass) filters capturing medium-term cycles in real credit, the credit-to-GDP ratio and real house prices. The Business Cycle is as measured by a frequency-based (bandpass) filter capturing fluctutations in real GDP over a period from one to eight years. Bear in mind that the so-called real adjustment is to the managed price inflation index, which is routinely wrong and badly under-stated. Therefore the cycles are much more volatile high and low, since inadequate inflation is removed. In other words, their cycles are damped in amplitude from the true reality.
Max Keiser and Das Satyajit entered an excellent discussion about the fast deteriorating global financial situation. Its faults, corruption, and imbalances are not being addressed. The structures are moving toward seizure and systemic breakdown. They touch on key elements that show up in today's markets. Das made his reputation with knowledge and warnings about bank derivatives a decade ago, attracting Jackass attention. He knows a great deal more than derivatives. Once upon a time Max declared him one of the sharpest brains on the planet. See YouTubes (HERE & HERE). Das is not alone, in good company on breakdown dynamics. The system is on the verge of breakdown. See Investment Research Dynamics (HERE).
◄$$$ PEAK OF BAKKEN OIL PRODUCTION SIGNALS COLLAPSE OF USECONOMY, CLAIMS SRS ROCCO... SHALE ENERGY OUTPUT WILL BE IN VERY FAST DECLINE... LOST IS THE HOPED FOR ENERGY INDEPENDENCE... AT GREAT RISK STILL ARE THE MANY ENERGY FIRMS, BUT ALSO THE PROVINCE OF ALBERTA. $$$
The United States is in serious trouble. The great US-based Bakken oil field was touted for supposedly for making the United States energy independent. It is showing signs of peaking, with indications of rapid decline in coming months. Not only has oil production from Bakken declined significantly, but so has it at Eagle Ford. If these two shale oil fields have indeed peaked, SRS Rocco expects to see further moves toward the collapse of the USEconomy. According to the US Energy Information Agency (EIA), in their May 2015 Drilling Productivity Report, shale oil production from these two fields is forecasted to decline 78,000 barrels per day (bd) in June. Relying upon the EIA Drilling Productivity Reports, conclude the Bakken peaked in March at 1.328 million barrels per day (mbd) and the Eagle Ford at 1.733 mbd. The shale oil industry was already losing money in 2014 when the average price of oil was $93. This region is in fast decline, with massive capital damage in progress, gathering momentum.
SRS Rocco concluded in dire terms the situation. "Very few Americans realize a country's wealth is based upon its natural resources. The United States was the Saudi Arabia of oil production during the 1940-1950's. However, after US oil production peaked in 1971, larger oil imports were necessary to meet growing domestic demand. The US was able to import oil as it controlled global trade via the world's reserve currency, [namely via] the fiat USDollar. Basically, the United States was able to live off the wealth and resources the rest of the world by running continuous trade deficits while increasing debt. Unfortunately, the world has grown tired of taking worthless USDollars (continually printed into oblivion by the Fed) for real goods and services. The US financial system died in 2008 and has been propped up by massive Fed and USGovt monetary printing and liquidity. This allowed expensive shale oil to be extracted, which gave the illusion that the United States could once again become energy independent. Once it is perfectly clear that US shale oil production has peaked, it will signal the collapse of the USEconomy." See SRS Rocco Report (HERE). He looks from an internal perspective, whereas the Jackass looks from an external perspective. The global rejection of the USDollar will work at the same time the US loses its dreamed of energy independence.
The fallout from lower oil price is extreme and widespread. Oil companies are going bust and bankrupt, even as Alberta hits the skids badly. See Fortune (HERE) and Fool (HERE) and WSWG Org (HERE) for energy firm deep damage. The province of Alberta is in danger from the rout. Their economy is very dependent upon the energy industry. So is the Canadian Dollar, whose risk extends to lower demand for commodities that include energy, minerals, and foodstuffs. The currency is at risk from the oil price decline and global economy in recession. See Huffington Post (HERE) and News Vice (HERE) and Global News (HERE) and Financial Post (HERE).
◄$$$ SAUDI ARABIA APPEARS TO BE RESTRUCTURING ITSELF, IN PREPARATION FOR REFORM OR EXTREME FALLOUT FROM THE FINAL STAGES OF PETRO-DOLLAR DEMISE... A FINANCIAL FALLOUT COULD ARRIVE VERY SOON OF INCREDIBLE PROPORTIONS... THE KINGDOM MIGHT BE MAKING PREPARATIONS FOR A STORM, IN ORDER TO PRESERVE ITS NATIONAL WEALTH FROM DEFAULT CLAIMS WITHIN THE FINANCIAL ARENA. $$$
The Saudi Royals are in the process of restructuring their financial house, in particular how it connects to Aramco, the giant sprawling national petro-chemical business. A council was created of ten people, headed by the son of the king. He is the second stage of pretender to the throne. The Board will monitor the activities of Saudi Aramco, which contains the enormous wealth locked in national energy reserves, massive capital investment, with all the engineering expertise, including sophisticated scientific software. The consensus expert opinion is that in view of the country's income decline from oil sales, the Aramco business might be better regulated. Notwithstanding, other analysts question the need for royal intervention in the Aramco itself. The new council features Mohammad bin Salman Al-Saud, who sits as defense minister and head of the Council for Economic Affairs & Development. He is also next in line to the throne. He oversees the policy that coordinates economic reforms required in connection with the decline in oil prices. See War & Peace (HERE).
Speculation is ripe on the reforms and restructure, which are not to share wealth with the public. A major shakeup is brewing in the House of Saud, something not immediately apparent. It could be political. It could be girding the kingdom's belt in the face of severe shocks from the energy price decline. It probably has nothing to do with the Yemen uprising to the south. To be sure, the oil income is down, and the Petro-Dollar derivatives are being dismantled, but the trusty brilliant EuroRaj has a more in-depth penetrating opinion. It runs parallel, but integrates deeper angles. He wrote, "It could be that Saudi Aramco is loaded with derivatives. Their inherent risk might possibly be these derivatives used as a vehicle by counter-parties to exploit the wealth of Saudi Arabia via the oil ministry. The external parties might be in a legal position to lay claim to enormous Saudi reserves and its related wealth. The formal changes might be to prevent any financial market collapse from causing vast ripple effects within the Saudi wealth locked in energy reserves. The threat might be perceived in relation to a further sequence of broken platforms and more dangerous momentum in the collapse. If the pseudo sovereign guarantee and linkage is removed, the prized conglomerate of Saudi Aramco can be permitted to run its course in the current systemic breakdown. The derivative laden shell can be allowed to fail, while the assets still remain with the state in their possession. With certain revisions, Aramco might remain in Saudi hands, but under different forms which exclude foreign claims like many nations do with national monuments." As usual, EuroRaj is deep with insights of great relevance, which will likely be more clear with the passage of time. Saudis are preparing for the Global Reset and fallout. The wreckage of derivatives tied to the Petro-Dollar are nowhere near complete in running their course.
◄$$$ RUNNING OVER 40 DAYS AND STILL COUNTING, THE USTREASURY CLAIMS THE OFFICIAL NATIONAL DEBT HAS BEEN FROZEN AT $18,112,975,000,000... IT SMELLS LIKE A DEBT DEFAULT TRAIT... WITH QE FIRMLY INSTALLED, THE DEBT VOLUME OF NO CONSEQUENCE... THE US-POLITBURO IS ESTABLISHED, STUCK IN CONCRETE. $$$
The only portfolio loan item with a constant debt balance is a defaulted one. It resembles a constant flatline EKG and pulse on a human being on a gurney in the Intensive Care Ward, as in a dead man. Next stop is the morgue. Aside the bond panic is the wall item where the official USGovt debt stands fixed. Present the next brick on the wall, one more landing perch for a gaggle of Black Swans and Nasty Crows. Behind the scenes are hidden macro events like the USGovt debt default in portions, the seizure of JPMorgan HQ in South Manhattan, the sale of controlling USFed interest, and perhaps some foreign policy directives given by Beijing to Washington. The USGovt debt is so big and so complex with so many creditors from so many past disasters, that its final default must occur in steps. The symptoms of default are cropping up.
The public populace is badly distracted by steady blare of propaganda, renewed racial civil strife, anti-depressive drugs, foreign wars of dubious nature, and the lure of yet more consumption. In the main, they no longer see a solution on the horizon. They realize they are running out of money, and nearly have run out of time, as a deeper collapse awaits. National polls show a fast decline in hope for the future. They do not yet see the consequences of a global USDollar rejection and the horrendous implications to the domestic USEconomy. That comes later, maybe not very much later. See CNS News (HERE).
◄$$$ A RUN ON BRITISH BANKS HAS HIT A MIDDLE GEAR, AS MONEY LEAVES THE SYSTEM... CAUSES ARE MANY, BUT INCLUDE RUSSIAN FUNDS LEAVING, WITH MOTIVE TIED TO THE UKRAINE WAR BACKLASH. $$$
The British have remained curiously under the radar during the European bust and the US firestorms. Investors in the UK banks have withdrawn US$356 billion over the past 15 months, a staggering figure. The outflow casts a finger at the political atmosphere, in addition to an exodus of Russian money from the London Centre. The result has caused a fear of impact to the British Pound currency. The destination and purpose of the outgoing funds is not clear, as in other British assets like properties or stocks or bonds. Russian money might be locked in new asset purchases, distrustful of banks and in preparation for the Global Reset shock. Perhaps in time it will be known whether foreign investors want to make distance from the UK. "It is believed that the Russian money started to leave Britain in the last year, after the Ukrainian crisis has resulted in sanctions. By December, the situation worsened when President Putin told the oligarchs to return funds to their homeland," the article said. Much of the blame is placed on the Ukraine War event, the Russian sanctions, and the entire stench of the Kiev Regime support by Europe, England, and the US. See The Times (HERE).
◄$$$ USECONOMY IS FAST FALTERING AND FAILING... THE GREAT CONSUMPTION ECONOMY IS A DISASTER ZONE... AFTER CONSUMING THE NATION'S CAPITAL FOR A DECADE, IT IS TIME TO SHUT DOWN THE STORE... CREDIT REJECTIONS ARE THE NORM, NOT EVEN CHALLENGED ANYMORE BY BUSINESSES... THE NATIONAL ECONOMY IS DEBT DEPENDENT, AND THE CREDIT IS DRYING UP OR BEING REJECTED... THE QE MONETARY POLICY HAS DRIVEN A STAKE THROUGH THE AMERICAN CAPITAL HEART... THE SYSTEMIC FAILURE IS MANIFESTED IN THE ECONOMY. $$$
The USGovt and Wall Street continue to call the QE monetary policy stimulus, when the bank masters should be called prison commandants and worse, syndicate dons, narcotic traffickers, financial market riggers, and transaction tolltakers at the point of a gun. However, the fact that over 6000 US retail shops have recently been closed (or soon to close) illustrates how badly the USEconomic depression has become. The great consumer economy is a derelict vessel taking on water, without rudder, its helm vacated, no longer able to borrow money from home equity to buy foreign made products. More proof of a bigger than Lehman USEconomic collapse is now utterly obvious. The US Retail chains are in the midst of a colossal slam. Recall the moronic economist pablum for a full loud decade that consumption drives the USEconomy. It instead eats capital. In reality, business investment drives any economy. Let it be known that the USEconomy still has more retail space at work per capita than any other nation in world. The retail shutdowns are just the beginning, or better described as middle stage in collapse. The wrong-footed errant mantra for years, echoed by the helm, has claimed that US consumption powers the national system, even the global economy. Not so! Consumption has eaten capital, while business investment powers the economy by setting up shop for production with hired workers. The nation has lost its concept of both capitalism and money. A really big shock will come when Sears shuts down, possibly this year. Major US Retailers are closing 6000 stores permanently, announcements made recently. Their action assures QE to be permanent, as even Fed Governors have begun to admit.
The list is extremely long and ugly of shutdowns. Read 180 Abercrombie & Fitch (by 2015), 1784 Radio Shack, 338 Wet Seal, 223 Barnes & Noble (through 2023), 265 Body Central & Body Shop, 200 Walgreens (by 2017), 133 Target, Canada (bankruptcy), 120 Chico's (through 2017), 200 Children's Place (through 2017), 300 Deb Shops, 340 Dollar Tree & Family Dollar, 150 American Eagle Outfitters (through 2017), 75 Aeropostale (through January 2015), 40 JCPenney, 127 Jones New York Outlet, 400 Office Depot & Office Max (by 2016), 55 Staples (2015, after 210 last year), 100 Pier One (by 2017), and many more. The Jackass chose the best known among the long list. America is shutting down the store, the shop busted, the malls half empty. It is truly time for the nation to get back to work, after tossing out the bankers from government. The Fascist Business Model is a grand total failure. See Zero Hedge (HERE).
The credit picture is just as bad as the retail picture. In early May, the Atlanta Fed has begun to suggest that the USEconomy is undergoing the worst collapse in macro data since 2008. Notice they cite a data bust rather than economic bust, since they cling to the inane notion of a sluggish recovery. The largest spike in credit application rejections has indicated a credit crunch. The serious financial stress manifested in the data does not bode well for the growth of the economy going forward, they said, putting it mildly. According to the Credit Manager's Index (CMI), the Rejections of Credit Applications index just crashed the most ever, surpassing even the credit crunch at the peak of the Lehman crisis. The details of this critical indicator for the USEconomy are very much under-reported. For a nation dependent upon credit, absent a critical mass of industry, the disaster is clearly directly ahead. Maybe the Ukraine War, its related Russian sanctions, and disfavor of US-led trade pacts has finally slammed the psychology behind the nation. Maybe it is just QE failure causing a capital sabotage within the nation. Maybe the USFed and big banks are pulling the plug on credit, cannot manage the internal seizures, or have lost control of the system. Maybe all together.
The credit applications index fell from an already weak 48.1 to 42.9 in the latest reading. This is beyond credit crunch territory, as in disaster zone. The nation is back to post-Lehman hard times but without admission. Suddenly companies are having great difficulty obtaining credit. The reading for accounts placed for collection slipped below 50 with a drop from 50.8 to 49.8 which suggests that many companies are beyond slow in payments and are faltering badly. The disputes category improved very slightly from 48.8 to 49.0, but still below 50. This indicates that more companies are in such distress they are not bothering to dispute. They are more intent on surviving. The dollar volume beyond terms slipped even deeper into contraction, with a reading of 45.5 after a previous reading of 48.4, all downward. The dollar amount of customer deductions slipped out of the favorable 50s, falling from 51.8 to 48.7 very badly. The rejections of credit applications is as miserable as it has been in recent years, going from 45.9 to 42.0 in a grand slide. These are very bad tidings. The only semi-bright spot was that filings for bankruptcies stayed almost the same, going from 55.0 to 55.1. The clear conclusion is that big problems loom in the financial security of these companies. See Zero Hedge (HERE). The feckin idjits in Washington cannot spin this data into positive within the discredited sluggish recovery story. A joke, get it? Discredited!
◄$$$ VENEZUELA PLANS TO NATIONALIZE ALL FOOD DISTRIBUTION, INCREASE PUBLIC WAGES 30% IN RESPONSE... THE NATION HAS ENTERED THE FINAL DEATH THROES, LOCKED WITHIN PURE STUPIDITY IN LEADERSHIP LACED WITH DESPERATE LUNACY... THE VENEZUELA BOLIVAR CURRENCY HAS FALLEN TO A RECORD 302 PER USDOLLAR ON THE BLACK MARKET... EXPECT PRESSURE TOWARD A REVOLT IN THE STREETS THIS SUMMER. $$$
The mindless Chavez socialist clowns are still in charge, only with altered nameplates. The ravages of sudden currency devaluation last year have continued to produce acute shortages of everything from rice to beans to toilet paper, even most basic household necessities. The nation is desperate to bring in foreign currency. When condoms and feminine napkins are in worse shortage, expects riots to intensify to the extreme level. The midget Maduro is hardly a mature student of economics (maduro in spanish means mature). Apparently the Caracas way to combat inflation is to grant a 30% increase in wages, thus running up bigger unsupportable deficits. The public response has been to throw fruit at the president. The nation has been reduced to Lord of the Flies, with oil production way down as well. Foreign parties have exited the nation over security concerns and distrust of idiots in charge. The enemy of the state has become Dolar Today, a website which quotes the black market for USDollars, hated by Maduro in the open. The leaders blame the mirror on the wall. The people are suffering from shortages and lost wages. The nation's wealthy, as well as their best educated, are migrating out of the country. In 2014, at least 120,000 migrated to neighbor Panama, which itself is a very small country. Panama only accepts those who bring money with them, and can prove the funds. The nation of Venezuela has turned increasingly bizarre as it moves further into its death throes. The Govt gave up their gold to Goldman Sachs two years ago, to buy time in exchange for cash swaps. They are out of gold and out of time in a story of incredibly corrupt and obtuse mismanagement. See Global Economic Analysis (HERE).
◄$$$ THE KENYAN SHILLING'S FALL AGAINST THE DOLLAR SIGNALS A RISE IN COST OF LIVING... THE NATION IS DEPENDENT UPON IMPORTS, WHICH ROSE BY 15% IN YEAR 2014... THE EXPORT TRADE IS NEARLY FLAT... THE TRADE DEFICIT GREW BY ALMOST 20% LAST YEAR, FOR A CERTAIN SHOCK WAVE. $$$
The nation of Kenya is one of the major economies in Africa. It has wide British roots, evident in the currency name, the Shilling. The Kenyan Economy has hit the wall. The recent decline of the Shilling against the USDollar signals a hefty rise in the cost of living. The Kenyan Shilling (KES) continues to fall against major world currencies, assuring a rise in the cost of imported products. It is dependent on the foreign finished product flow to maintain the standard of living. A recent reading had the KES trading at 94.35 per USD, moving ever closer to breaching the psychological mark of 95 units to the dollar. Kenya is a net importer of consumer goods such as petroleum, processed foods, and clothing, plus raw materials and machinery. Their costs are expected to rise with a weaker Shilling, lifting price inflation in clear terms.
Some national macro statistics from an official banker's report, provided by an intrepid consultant with offices in East Africa. Kenya imported goods worth KES 1.618 trillion (~US$15bn) in 2014, up 15% compared to KES 1.408tn in 2013. The value of exports however rose only marginally to KES 537.1bn (~US$5bn), which resulted in a wider trade deficit by KES 177.7bn to aggregate KES 1.08tn in total, which equals about US$10.5 billion. Note a staggering 19.7% rise in the trade deficit in a single year. A shock wave comes.
The consultant HTLetter client MaxB wrote, "I have been predicting this for the last five years, but few listened. All these government published figures about inflation and more are nothing but fudged nonsense without end. Considering that Kenya is one of the strongest countries in East Africa, one wonders why they cannot organize their offices better. It is just stunning to see the stupid policies, like a series of bank fee hikes. The next nation hitting the skids is Nigeria. That West African nation does 80% of the consumer spending of all Africa. For them to hit the skids will have serious repercussions for the entire continent. The Union of South Africa has seen the worst violent riots in decades, yet nothing to be seen in the main stream media. If not for South African friends keeping our firm informed, we would not know what goes on there. They have a news blackout in force. Some exceptionally good and competent people work busily in Nairobi. However, they are not allowed to conduct business the way it should be done. We shall soon see Baltimore and Johannesburg kind of riots in other major African capitals. It only takes one spark and all blows up."
## CALIFORNIA DROUGHT PROJECT
◄$$$ WATER IS BEING CONTAMINATED BY HALLIBURTON, WHILE HAARP BLOCKS CALIFORNIA RAINFALL... THE BROADBASED ELITE INVESTMENT IN THE WATER INDUSTRY FITS LIKE A GLOVE TO LIFT ITS VALUE FROM SHORTAGE AND CONTAMINATION... WATER IS THE NEXT GOLD. $$$
As preface see the Environment section of the April Hat Trick Letter Crisis Coverage Report for the background story of broadbased investments in the water industry by the Elite criminal families led by the Bush Family. Their agent clearly is Halliburton for destroying the viable water systems, via fracking injections and actual dumping of toxic liquids into the many aquifers. The Elite investments are numerous, all vertically integrated from water sources to treatment, the full gambit. Finally the real effect is grasped with motive, investment, actions, and legal details. A key item showed up with criminal prosecution of a West Coast farmer who attempted to collect rainwater. Unsure what the offense was, except perhaps opposition to the cabal. My theory is simple. Halliburton is wrecking the US water table. They are also dumping toxic chemicals into the water table systems across the country. A story was reported that in March, about 1.3 billion gallons of contaminated water was dumped into the California aquifer systems. Meanwhile, HAARP has erected a wall off the California coast, to prevent rainfall on the entire fertile plains. The lakes and reservoirs are drying up. Conservation measures are being put in force. The drought and contamination are the goals. The Bush Family and other Elite groups are buying the water sources. They are buying the entire integrated water businesses, including anything related to water, its movement, its purification, rights to drill, everything. The plan is to wreck the public water sources, then sell their water at much higher price when shortage is acute. See Think Progress (HERE) for details on the drought, and MSNews (HERE) for an aerial view of California's plight.
◄$$$ THE DROUGHT IN CALIFORNIA COULD DISRUPT AMERICA'S ENTIRE FOOD SYSTEM... THE STATE PROVIDES 80% OF THE US-FOOD SOURCE, AND ALMOST 50% OF THE GLOBAL FOOD SOURCE... DESPERATION IS SINKING IN, AS CONSERVATION MEASURES ARE PUT IN PLACE... THE DROUGHT IS HITTING FROM NATURE, WHILE CORN POLITICS ARE HITTING FROM THE HUMAN HAND. $$$
Desperation during drought to the most important US-based food supply region has caused conservation measures across the state. Some California farmers are resorting to watering their crops with oil wastewater, but nobody knows what it contains. Governor Jerry Brown presides over a disaster zone, soon to slam the state economy. The mountain snows are nowhere near their normal five feet of snow in depth. The Sierra snowpack, which usually feeds the California reservoirs and supplies one third of its water, stands at just 8% of its yearly average. That is a historic low. Gov Brown mandated that urban agencies curtail their water use by 25%, a move that would save some 500 billion gallons of water by February of 2016. It seems like a huge amount, but it is not at all. Consider that California's almond industry uses more than twice that much water annually. Still (Moonbeam) Brown's mandatory usage cuts did not touch the state's agriculture industry. An analyst summarized, "California water regulators are getting worried. The state has now approved a set of sweeping conservation measures designed to cut water consumption by up to 36% in some areas to combat a severe drought that has now killed some 12 million trees and threatens to turn California into a modern day Dust Bowl." Farmers use 80% of the state's available water. He justified the mandated restrictions by saying, "They are not watering their lawn or taking long showers. They are providing most of the fruits and vegetables of America to a significant part of the world."
Almonds receive a lot of the attention, for illustration and even mockery. In typical salads, odds are the lettuce, carrots, onions, and radishes all came from California. The state utterly dominates the US national fruit and vegetable output. It produces 84% of the country's fresh peaches, 94% of the country's fresh plums, 94% of the country's tomatoes, 99% of the artichokes, and 94% of the broccoli. Down the list, almost 50% of asparagus comes from California. The state consumes trillions of gallons of water for its agriculture industry, the output for which fills the supermarket produce aisles stocked with fruits and vegetables in all lower 48 states. Until recently, and surely in past problematic years, feats of engineering and networks of underground aquifers have made the drought somewhat bearable for California's farmers. A national food supply crisis is underway, certain to affect supply and price. Worse, the state of California might limit the export of food products to other states, resulting in extreme shortages. The drought maps are frightening. Experts are finally wondering where the food sources will come from, even from large scale imports.
The California Central Valley, which stretches 450 miles between the Sierra Nevadas and the California Coast Range, is widely regarded to be the single most productive tract of land in the world. From its soil springs 230 varieties of crops of great diversity. Its output marks two thirds of the nation's produce, and 80% of the world's almonds. When an American is eating at the dinner table, the chances are near certainty that the vegetables came from there, were planted and picked in the Central Valley. The wine industry in Napa Valley northeast of San Francisco is unique for its 14 different microclimates, believed an extension from earthquake effects. They are perfect for wine, a truly unique place for growing grapes. Few places in the world are better suited to growing almonds than in California.
Debate has begun to swirl. California produces in stunning numbers the tomatoes, lettuce, celery, carrots, beans, and so much more. But many items can be grown elsewhere. Before the 20th century, the majority of produce consumed in the United States came from small farms that grew a relatively diverse number of crops. Fruit and vegetable production was regional, and varieties were dictated by the climate of those areas. Once upon a time, citrus and certain nuts were uniquely suited to the Mediterranean climate. Numerous items were grown in other locations before California became the dominant ample player. John Ikerd, professor emeritus of Agricultural & Applied Economics University of Missouri Columbia, told Think Progress of his youth with scattered canneries in rural Missouri. The majority of the food consumed came from within 50 miles of home, for most people. Orchards were also once plentiful throughout the Midwest, growing apples and fruits for markets both local and national. But the tomato canneries and the many orchards that Ikerd remembers have largely disappeared, replaced by fields upon fields of corn and soybeans. These commodity crops are encouraged by USGovt subsidies for earning the biggest fastest profit in the Midwest.
Consider a disruptive law that dictates what is grown. From 1996 until the most recent version of the Farm Bill, farmers who grew commodity crops like corn and soybeans were actually prohibited from also growing specialty crops like fruits and vegetables on their land. Violations resulted in forfeited subsidies. The USGovt spent almost $84.5 billion dollars subsidizing corn between 1995 and 2012, and a good portion of corn crops does not make it to a dinner plate, instead used as ethanol or as cornfeed for livestock. Of the corn set for human consumption, much of it ends up as high fructose corn syrup, an utter abomination of the US nation and cause for much obesity. Diversity in the agricultural industry has been severely altered by corn politics. Neither ethanol fuel is a great solution, nor corn syrup of any benefit whatsoever. Yet they rule over the farms. From 2002 to 2012, the amount of land dedicated to growing the nation's top 25 vegetables fell from 1.9 million acres to 1.8 million. In the same amount of time, corn production grew from 79 million acres to 97 million. See Think Progress (HERE).
◄$$$ THE CALIFORNIA MEGA-DROUGHT 2015 AND MYSTERIOUS STRANGER IN OREGON PARKING LOT 2006... THE DROUGHT WAS PLANNED YEARS AGO... THIS IS SPOOKY... PROPERTY WITHIN THE STATE AND ITS ECONOMY ARE AT GRAVE RISK. $$$
Credit to a special client JacksonG from California once upon a time, who shared the story. The following is his account of a chance encounter, his words with my edits. Fact is indeed stranger than fiction. My home used to be in La Jolla, near San Diego. One summer, I decided to do a 1-month national parks tour along the Pacific Coast Highway up to British Columbia in 2006. The route included the Yosemite, Monterrey, Pebble Beach, Palo Alto (to see Stanford Univ), Mt Hood, Crater Lake, and Willamette, all done with no time constraints. One early morning, when I was staying in an Oregon hotel in Salem, around 6:30am, in a parking lot a middle-aged fellow joined me with a coffee on the curb. He kind of looked like a cowboy type with boots, but spoke refined, elegant, intelligent English. After some small talk, I told him of my background in Hawaii with a current place near San Diego, renting a home. An added point was made that a US housing mega-bubble was soon to burst in my opinion, which led me to sell everything. He replied that it was not wise to buy property in California. He went on to explain that California was going to have a severe drought, but without any specific time when it would occur. Now this was back in 2006. I asked him why and what he meant by that because California had Lake Mead, Lake Tahoe, Hoover Dam, and more as sources feeding its water supply.
The mysterious man said he was an engineer from Canada who was in United States, working on a project to pipe fresh water from Canada to California. I asked him how they intended to pipe the fresh water. He claimed the source in Canada would be from Hudson Bay. Despite being salt water, the great bay has lighter less dense fresh water from glacial ice melt. The denser salt water settles towards the bottom of the enormous body of water. The majority of Hudson Bay is in fact fresh water from the natural runoff at the top. The entire surface of the bay contains fresh water. The man explained the long-range plan, to run pipelines parallel to the Mississippi River down south and branch west and juncture towards Nevada and California. He repeated the plan to bring fresh water from Hudson Bay, as response to the expected drought in California. I told him that sounded like an engineering marvel if ever it came to completion. We parted ways, with thanks for the advice not to buy California property as he went inside to grab breakfast at the buffet. I never asked for his name.
I never saw him again in my life. Just this brief 10-minute encounter with a mysterious man in an Oregon parking lot.
Fast forward, and here I sit in 2015, reading about a mega-drought in California, much like what the mysterious stranger in an Oregon parking lot told me back in 2006. Such is not conspiracy theory, but first-hand experience as direct witness. One must wonder if a new water pipeline will someday be announced, with some elite owners or even USGovt sponsorship to cover the costs. A long shot would be for China to be the owner, but given the Halliburton dastardly role and US Elite investments, it seems more likely for a big US Elite water landlord role in a conspiracy project. All life, human and animal and plant, requires water, and by extension so do most businesses. The mere fact that the Oregon man knew of a drought to slam the Golden State nine years ago is remarkable. It points to a dire plan which is being executed. Property owners beware. Business owners beware also.
◄$$$ THE CALIFORNIA PROPERTY AND WATER FACTOR ARE INTERWOVEN... SOON TO COME IS THE LOCAL BANKRUPTCIES, HOUSING MARKET RENEWED DECLINE, AND MASS EXODUS OF PEOPLE LIKE IN WAVES OF REFUGEES... THE FEEDBACK LOOP WILL INCLUDE POOR DECISIONS BY CITIES AND LOCAL GOVTS, WHICH WILL CUT ESSENTIAL SERVICE JOBS AND RAISE TAXES, LIKE THE SOCIALIST MORONS THEY ARE... THE EXODUS WILL MAKE HISTORY. $$$
The California water crisis in all likelihood will lead to a series of economic disruptions, aggravations, and new crises. Expect a housing decline to originate from the California epicenter of drought. It could result in a housing market collapse and panic. To be sure, a raft of municipal bankruptcies will occur. As life and times become impossible in the Golden State, a mass exodus of people is assured in several waves. The reality has yet to hit home, but it will arrive like a hurricane slam. The California real estate prices have not even suffered big second stage declines, yet alone collapse. Somewhat mindless to the risk, ignorant of the water related state of emergency, hordes of people continue to chase and purchase commercial and residential property precisely in the areas that will be hardest hit by new water rationing. The value of a home or business that has no functioning connection to a water system is essentially zero, just like for a condemned dilapidated property.
When the statewide drought eventually motivates a critical mass of people to decide to abandon the region, to move on, and to sell out, the result is come is a sudden powerful decline in property values. The housing market will see a huge glut of home for sale on the open market, a veritable collapse of scarcity, a wide variety with depth of available homes to consider for purchase, and a nasty collapse in home valuations. It is all coming, complete with feedback loops in vicious cycles. Eventually, pending sales will be scuttled due to poor comparable sale prices and fearful banks to approve the loans. Reality is setting in. Eager and aware sellers will discount their homes, to be the first out. Doing so will wreck the comparable price activity during loan approval processes.
The next wave will include a powerful drop in property tax income, the main revenue stream for cities and municipalities. Local government cannot print money like the corrupt national financial entities, such as the USGovt and USFed central bank. Their money printing wrecks the entire system and rots the entire fish from the head down. The cities and other locales can issue bonds, but those bonds must be repaid. Bond defaults are coming, since repayment of past bonds cannot be managed. Cash flow comes from property taxes which will plummet, and gather more national attention. This situation is aggravated by the fact that many of California's cities and towns are already in a state of near bankruptcy. The past pattern is stark clear. As property tax income falls hard, in reaction California will refuse to cut social programs, and instead hike all possible forms of taxation to unprecedented levels. They will also cut jobs of essential services, which will make life among households and businesses unbearable, even making crime on the streets easy. The cycle feeds upon itself, and will cause an acceleration of the exodus of California taxpayers who finally quit. See Natural News (HERE). For a snapshot of the San Francisco housing market bubble, mindless high bids still, amidst the harsh threatening economic backdrop, see Of Two Minds (HERE).
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.