Amazing how the world “resets” each morning, a fresh new day with endless possibilities.
TPTB aim to limit such possibilities via an endless litany of “committees”, “facilities”, and otherwise “dark pools” of PRINTED MONEY utilized to manipulate markets, and at times it appears they can accomplish anything they wish. However, no matter how sophisticated their technology, how deep their connections, and how limitless their printing presses, reality always trumps illusion. Economic Mother Nature has never been denied her due, and certainly WILL NOT be denied now. As they say, “the bigger they come, the harder they fall.”
Before I start today’s RANT, below is an interview I taped yesterday with the affable Kerry Lutz of the Financial Survival Network:
Hopefully, you will listen to my two-hour spot on John Stadmiller’s National Intel Report tomorrow at 5:00 pm EST, as well as read the excellent introduction to today’s Miles Franklin Daily Blog, written by our firm’s founder, David Schectman.
Back to the real world; it appears the honeymoon for last week’s GLOBAL QE announcement by the Federal Reserve is about OVER.
While at the gym this morning, watching the usual Cartel gold suppression (top tick at EXACTLY 3:00 AM EST, Dow/Gold x2 ALGORITHMS, etc.), I thought about the nature of last week’s coordinated dollar swap announcement. When it came out, stocks took off on the INSTINCT that any and all MONEY PRINTING is beneficial, even though, of course, all the previous MONEY PRINTING has been a colossal failure. The PPT was certainly amidst the initial surge, but as noted in prior RANTS, the fact that “HAIL MARY” rallies were required both Tuesday and Wednesday told me a lot about what the market really thinks of such “improvements,” and in fact the market has faded nearly every afternoon since. Each evening, Dow futures are goosed and gold leaned on to “set the tone” for the next day, but my sense is there is no real investor belief that anything has changed.
True, sovereign yields declined in Europe this week, but was the cause truly a measly 50 basis point reduction in Federal Reserve overnight lending to insolvent banks? I mean, c’mon, the ECB lowered interest rates last month from 1.50% to 1.25%, yet two weeks later the system was on the verge of collapse, so much so that the ECB is expected to again drop rates TOMORROW by another 25 basis points. In other words, short-term ECB funding rates had already been reduced by as much as the Fed “overnight swap rate” last week, so how can the Fed move be considered anything more than a modest monetary change?
You want the answer, well here it is. THE SYSTEM WAS DAYS, IF NOT HOURS, FROM IMPLOSION LAST WEEK!
As you can see below, since the Fed dollar swap interest rate cut last week, USAGE of the facility EXPLODED, to the tune of $52 billion immediately. This article states that “expectations” were that no more than $10 billion would be used, but in actuality the number was more than 5x this amount.
In other words, those setting “expectations” weren’t aware of the PANIC going on behind the scenes, which has been rumored to be the imminent collapse of Credit Agricole. However, from inside sources, such as those secured by Jim Willie, hands down the best newsletter writer in the business, there were potentially “20 Lehmans” lined up to fail last week, which obviously necessitated the unprecedented, impromptu meeting of the world’s seven largest Central Banks, and ultimately the decision to reduce interest rates on the Fed’s dollar swap facility.
Don’t be fooled by the name of the below link, an excellent interview with Jim Willie. He talks about a variety of topics in it, but the author of the blog this is posted to highlighted Willie’s comments about JP Morgan, MF Global, and the COMEX. Earlier on in the interview, he talks about the “20 Lehmans,” a view that makes complete sense to me.
Again, the amount of the interest rate cut isn’t the story here, but the dramatic increase in the facilities’ usage. I believe these Central Banks met, and acted, so suddenly because the system was about to implode, and in the same manner as the TARP handouts three years ago, FORCED the most insolvent banks to take tens of billions of overnight “loans,” which is probably why the $52 billion of usage was the LARGEST, MOST INTENSE CONCENRATION OF SUCH LOANS SINCE….DRUMROLL PLEASE…THE WEEKS SURROUNDING THE LEHMAN COLLAPSE!
This morning, we have confirmation that last week’s SUPER POW-WOW was all about mushrooming insolvency, as the ECB announced it is considering further measures to ‘loosen financing regulations’ for member banks, including the acceptance of more, and lower quality bonds as collateral for loans, EXACTLY what the Federal Reserve Bank has done in America with its own cadre of walking dead…
…and additional “rescue facilities” to bail out failing banks. Let’s just ignore the fact that the first “rescue fund,” the EFSF, was DOA, when we consider the possibility of a second fund. My god, the desperation is getting intense!
The CONTAGION spreading around Europe will spare NO ONE in its wake, from the PIFIGS (PIIGS plus France) at one end of the spectrum to “healthy” Northern nations such as Germany, Austria, and Denmark at the other.
Much ado is being made of the latest dire, urgent, “life or death,” drop-dead important European Financial Summit, scheduled for tomorrow, but frankly, as noted yesterday, I have no idea what exactly they are talking about. I’ve read snippets about austerity, unified European government, EU treaty changes, and near-term financing options. However, to me it sounds like yet another boondoggle aimed solely at buying time before the ultimate collapse.
As stated eloquently in the below article about the summit:
Many EU leaders seem to actually believe Treaty changes are important. The reality is the market could care less about treaty changes. The market cares about only one thing, that the ECB will announce new, bigger, more aggressive sovereign purchases.
Europe Doesn’t Get It – ZeroHedge
Yes, readers, it ALWAYS comes down to the same thing, HOW MUCH MONEY WILL THEY PRINT? Which is probably why, despite the Cartel’s best efforts yesterday AND today, gold rebounded abruptly and sharply (although you can see the earlier capping at EXACTLY 3:00 AM EST).
The rest of the world was relatively quiet overnight, unless of course the potential epicenter of World War III moving to “war alert” is considered “important.”
Here in the States, the name of the game continues to be CORRUPTION, as always focused on the BANKERS and POLITICIANS that have stolen America’s legacy, destroyed its finances and reputation (as well as thousands of soldiers’ lives), and delegated America’s future to the third world.
Aside from the earlier interview with Jim Willie, where he focuses on COMEX crimes committed by JP Morgan and MF Global, we see JPM and its cronies actually SUING THE CFTC over its proposal to instill position limits on COMEX futures trading. Don’t worry Blythe, those limits will NEVER be instituted, and even if they were, it would only be on PAPER, whereas “behind the scenes” JPM et al will still have free reign to create all the illegal, naked short positions they like!
And one final note on U.S. political corruption, if you want to be sick to your stomach. My ears are still ringing from the 60 Minutes piece two weeks ago about how insider trading, in the stock market, real estate, and essentially EVERYTHING is perfectly legal for Congressmen! How kind of them to respond to the fly-by-night media scrutiny of this vile practice by actually taking time out from such shady dealings to hold a hearing on the matter.
Who wants to bet the issue is dropped without a vote, the MINUTE Congress realizes the press has moved onto something bigger and more interesting to America’s dumbed down masses (such as the article below)? Way to go New York Times!
The day is still young, but it looks like my forecast regarding the European crisis recommencing is on target, pending the results of tomorrow’s joke of an “economic summit,” of course…
Of course, at EXACTLY 10:00 AM EST, as always, with absolutely ZERO movement in the Dow, all of gold’s aforementioned gains were erased by the gold Cartel.
Keep buying, my friends, as the opportunity to buy PHYSICAL gold under $2,000/oz and silver under $50/oz will likely not last through the first half of 2012. You have been afforded yet another gift by the Cartel, as it scrambles to alter PERCEPTION of the collapsing EuroZone and hold Wall Street up long enough to pocket hefty, taxpayer-funded bonuses next month.
The PHYSICAL market is their Achilles Heel, and it is up to you to expose it!
Today’s RANT topic pertains to one of my favorite movies of the recent past, M. Night Shyamalan’s Sixth Sense. In it, Haley Joel Osmont has a unique talent, or better put, curse, in that he can “see dead people.” In this famous scene, the unsuspecting Bruce Willis doesn’t realize that he himself is one of the dead…
When I ponder the state of the world, I believe that I, too, can “see dead people,” and that they, too, do not realize they are dead. Readers of my RANTS probably have that gift as well, or alternatively, the Cassandra’s Curse. To us, ferreting out fraud comes naturally, effortlessly, as simple as adding two and two. The evidence is everywhere, the results proof in and of itself, but unfortunately facts do not hold an important place in our world, at least not anymore.
Fear not, REALITY always trumps ILLUSION, and it won’t take much for the world’s masses to cumulatively “see dead people,” too. I believe a LOT more people do than the media reports, as once again can be seen by the proof of their actions. Skyrocketing PHYSICAL gold and silver demand, bank runs across Southern Europe, the spreading “Arab Spring,” Occupy Wall Street, and numerous other initiatives PROVE that Osmont’s character is not as fictional as one would believe.
“The dead” are amongst us in many forms, from the brain-dead masses to morally dead politicians to financially dead banks and sovereign nations, and in time will be exposed for all to see. Sadly, much of this motley group of fools, thieves, and tyrants are no different than Bruce Willis’ character, in that they, too, cannot see they are on borrowed time.
But TIME is exactly what ticks against them, as “kicking the can down the road” only works so long as road remains to kick the can down.
PROTECT YOURSELF, and do it NOW!