The Golden Truth: QE3 On Deck! This Confirms The "Good" Economic Reports Are Bogus

Tuesday, February 1, 2011

QE3 On Deck! This Confirms The "Good" Economic Reports Are Bogus

Feb 1 (Reuters) - The Federal Reserve could debate extending its bond-buying program beyond June if U.S. economic data prove weaker than policymakers expect, Kansas City Fed President Thomas Hoenig said. Another round of bond buying "may get discussed" if the numbers look "disappointing," Hoenig told Market News International in an interview published on Tuesday. Here's the LINK

This confirms that the string of economic reports from GDP to employment, and even today's auto sales, are manipulated and misleading. If the "good news" was bona fide, the Fed would be discussing the tightening of monetary policy - raising interest rates and unwinding QE1/2.

But the golden truth is that the only policy keeping the banking system from collapsing and the U.S. Government funded is the Fed's printing press.

Got gold? Just like diamonds are a girl's best friend, quantitative easing/money printing/currency debasement is a gold investor's best friend! I'm not going to post the charts, but the daily charts for gold and silver look as bullish as I've seen in a long time. The price correction in January has likely set up a very big move in the metals. Pray to whatever you pray to that Eric Sprott's technical analyst is wrong about how high gold/silver may go by this spring, because that would imply that this country is on the verge of some very painful economic/social turmoil...

9 comments:

AnonymousTuesday, 01 February, 2011
yep, always watch what they do, not what they say.
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BillTuesday, 01 February, 2011
One dollar dirt nap please.

Incredible really.
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SatyaPranavaTuesday, 01 February, 2011
excellent post. but a point of slight contention, dave. since numerous people have been interviewed regarding Bernanke's and the Fed's QEII announcements, they didn't set June as any hard deadline for the cessation of QEII.

For me, that means/meant, that they were likely to continue (which most of us reading this already know) with the $600B/mo after June. Thus, if/when those *announced* purchases(bc we all know they're "stimulatin' far more than $600B/mo) go beyond $600B/mo or WHEN they publicly cease and start up again, I'll consider that QE3.

Satya
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AnonymousTuesday, 01 February, 2011
Imaginary games are the present day exercise for any and all prices regarding silver. Rumor has it that the true price of silver right this moment should be $ 250.00 per ounce. Imagine if you would many holders of physical silver,all at the same time advertising from around the USofA - FOR SALE- 1 oz. .999 fine silver ~ $ 250.00 true value. Would such a move trigger a positive reaction ?
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AnonymousTuesday, 01 February, 2011
with gold closing above $1340 per forward Crimex contract perhaps we have seen the bottom in Au/Ag correction. with the CCI breaking record highs and the ISM prices paid topping 80 indicating a CPI breaking 6.5% in the next 12 months (more likely 6) according to zerohedge, along with surging oil prices, can't we already feel the flames of inflation licking at our consumer heels. the fires in the bankster blast furnaces are being stoked for the incinerating conflagration of hyper inflationary combustion of the greenback. the IRA, 401K, and pension plan sucker holes will evaporate if not through government appropriation than through the inevitable hyper inflationary fire storms set to sweep through world economies. the engineered Egyptian chaos, much like the destruction of the European sovereigns serves as an ominous prefigurement of our foreboding future.
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Dave in DenverTuesday, 01 February, 2011
Hey yardfarmer - happy new year! I think a bottom is forming or has come and gone. Unless they have hidden hammer they are ready to swing at the market like they did in July 2008, I think we are going to see the metals start launch to new highs soon.
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Dave in DenverTuesday, 01 February, 2011
Anonymous, the "true" price for gold and silver at any given in point in time between today and where it ends up when it is re-established as the global reserve standard is anyone's best guess.

The true price for an ounce of refined silver in smaller quanitities is the price at which it is available today. I use Tulving as my benchmark for that and he is paying spot + 2.10 to silver eagles and selling them for sport + 2.59. That's the price.

On the other hand, imagine if China (or whoever) were to ask the world for an offer of 100 tonnes of 400 oz. LBMA gold bars. What we be the best offering price for that? I don't know that answer other than to say that it is at least 2x today's spot price, in all likelihood. You see my point? From there you can use an assumed gold/silver ratio to back into where a big "chunk" of silver would trade.

I don't know either where gold will be priced when it eventually is reinstated as the currency anchor for the world. Probably somewhere between Rickard's $7,000/oz and possibly $15k+ per ounce, which would be the number needed to monetize all the U.S. Treasury debt using gold. Or even higher if you assume we need to monetize more than just U.S. debt. Whoever controls the gold at that point in time will make those rules.
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Dave in DenverTuesday, 01 February, 2011
The $15k number above is using an assumed 8100 tonnes of U.S. gold (which we know is no longer there) per the original Bretton Woods deal.
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silvergoldsilverTuesday, 01 February, 2011
interesting readings, I check in a lot love it. You can check out my blog too...I am the author of the 'bears' videos...
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Why Gold?

Gold is the world's oldest currency. You exchange your fiat currency (dollars, euros, yen, yuan) into gold as an insurance policy against catastrophic Central Bank and Government policies which serve to destroy the value of fiat currencies and destroy democracy.

Gold can ONLY be considered an investment to the extent that it remains significantly and historically undervalued in relation to the fiat currencies against which its value is measured. Otherwise it remains the world's oldest currency and is completely free from the counterparty risk associated with currency by Government fiat (i.e. fiat currencies rely on a Government's "full faith and credit.")

Quote Of The Month Courtesy of "Jesse"

Unfortunately for Larry Summers, Ben Bernanke, and their friends at the BIS, they have not yet figured out how to print physical gold, silver, and other essential commodities, and the world is reaching the point where it might simply start ignoring the New York based markets with respect to essential commodities such as basic materials, oil, foodstuffs, and the like, as they become increasingly irrelevant, fraudulent, and Orwellian. And then where will the financial engineers be, except with no more excuses and no place to hide?

Here is the link to his entire commentary, well worth a read:

http://jessescrossroadscafe.blogspot.com/2010/07/gold-daily-chart-shock-and-awe-for.html

Great Quote From Jim Rogers On Govt CPI Reporting

JR: I mean, we have inflation now. If you go to the shop, whether it’s groceries, or education or insurance or health care, prices are going up for everything. The government lies about it in the US. Some countries lie, many countries don’t: Australia, China, India and Norway. Many countries don’t lie about it and acknowledge that we have inflation. Others lie about it, the UK and the US, but if you go shopping you know prices are up.

Q: Are you saying that the American Consumer Price Index (CPI) published by the US Bureau of Labor Statistics is a lie?

JR: In my opinion, yes, of course it is. Have you looked at it? They’ve changed their accounting several times in the past few decades. When housing was 20% to 25% of the CPI and housing was going up, they didn’t count it, saying rents weren’t going up, and then when home prices started going down, they counted it. It’s the same with many things. It’s staggering some of the tortuous reasoning that the BLS has used over the past 25 or 30 years. When the price of gasoline goes up, they say it’s not really going up because it’s better gasoline, better quality, therefore you’re getting more for your money. I mean, it’s endless, the stuff that they say and for some reason people sit there, although more and more people are catching on, and accept what the government says.

source: www.clusterstock.com

Quote of the Week

"The primary function of a Central Bank is to engage in the massive transfer of wealth from the middle class to the wealthy elite. The Federal Reserve was set up to do this with the blessing and support of Congress." - Dave in Denver

If you refuse to believe the above, please read "The Creature From Jekyll Island: A Second Look at the Federal Reserve" by G. Edward Griffin and then explain to me why the Senate voted down the Vitter Amendment and Congress refuses to pass a law requiring a full audit of the Fed, even though the Fed is using taxpayer-backed money to bailout Wall Street and Europe.