Thursday, January 5, 2012

A Couple Ominous Signs

Of course, there are many.  But first I had to get this off my chest, after reading the report that Jon Corzine and his wife were at some party in Paris shortly before MF Global collapsed and they announced that they were looking for a country French chateau to purchase.  Perhaps the bankruptcy trustee, who's law firm counts JP Morgan - the primary non-customer creditor to the bankruptcy - should take a look at all cash flows that flowed from MF Global to Jon Corzine.  It's a given that will never happen.  But it occurred to me that one of the primary co-conspirators in this whole situation is CFTC Chairman Gary Gensler.  In my book he is a total failure as a Government regulator and enforcer of laws.  He is an employee of the public and should be fired.  As a human being he is a loser.  Quite frankly, in my book Gary Gensler's status as a human being is between whale shit and the ocean floor.  And I extend this to AG Eric Holder for not initiating an independent investigation into this whole mess and to Obama for not forcing Holder to do so and for not removing Gensler from his position.  I guess that in and of itself is a very ominous sign for our system and way of life.

As for an ominous economic sign - one which points toward even higher Government spending deficits and debt issuance - this was the headline on the front page of today's Denver Post:  Medicaid rolls in Colorado at "all-time historical high" in November.   This is not a good sign for the country as a whole because Denver has one of the stronger regional economies, lower unemployment rates and an economy that is not dependent on heavy manufacturing.   When something emerges as a demographic trend in Denver, it usually precedes the same trend countrywide:
We've had a mushrooming of clients," Sue Birch, director of the state Department of Health Care Policy and Financing...There are just so many people who have lost their jobs — even those in my family who had really good jobs," said Dolores Rodriguez, while waiting for assistance at Denver's Westside Family Health Center
Here's the article:  LINK 

The Government is going to have to either cut back on other big areas of spending to maintain funding of entitlement programs like Medicaid and the perpetualized jobless benefits or it's going to have to resolve to create even larger deficits and raise the soon to be reached debt ceiling limit even sooner than we pessimists expected.  Any way you look at it, it's an ominous sign and it creates even more fuel for the next the leg higher in the precious metals.

One other ominous sign I wanted to point out.  And this is a statistic that is generated by Mastercard, not by the Government and industry association Phd  data manipulators (hint: the ADP payroll number released today was total bullshit).   It turns out that gasoline consumption during the last week of 2011 sank to its lowest level on record - at least the records kept by Mastercard.  Here's the story as reported by zerohedge:  LINK  I can't think of a better economic health indicator than energy consumption - either electric power consumption or fuel sales.  Speaking of electric power consumption, that has taken a nose-dive this year as well.  You can see the graphs in this excellent commentary by Mark Lundeen:  LINK

I wanted to finish today by re-emphasizing a point that I've been trying to hammer home for quite some time.  I was discussing the markets with a friend, who commented that "all eyes are on Europe."  My response was, "yes, all eyes are being deflected by Europe when they should in reality be scrutinizing the the ongoing collapse being hidden by the Government's Orwellian fog in this country."  Got gold?


  1. There are so many ominous signs they almost defy counting. However, my vote for the most hideous marker of bad times to come is the passage of the NDAA.

  2. I agree with that Edwardo, the problem is that only a very small percentage of the population even knows about the legislation itself, let alone the degree to which it is has literally destroyed the Constitution.

    What's even scarier, is that Obama still has a high degree of support from his faithful base. If those people truly understood what he just signed into law, they would want him incarcerated.

    I never thought it was possible, but in terms of destroying our democracy and destroying the Constitution, Obama has turned out to be even worse than Bush. It's just mind-boggling, especially after the platform and principles upon which Obama sold his candidacy. I honestly believe that Obama has emerged as being even more dangerous than all of his predecessors to our way of life. Although its all relative given that our system is essesntially already destroyed.

    It's amazing just how prophetic writers like Orwell and Rand were. Please people, don't start start trashing Ayn Rand now. regardless how her life ended up, her message from her writings are trully brilliant.

  3. Dave, do you think that the coming economic (and market) crash will provide another massive buying opportunity for PM's as forced liquidations temporarily drive down prices in a desperate scramble to raise dollars?

  4. "What's even scarier, is that Obama still has a high degree of support from his faithful base. If those people truly understood what he just signed into law, they would want him incarcerated."

    If only that last sentence above were true, Dave, but, alas. In my experience, even the most highly educated (purportedly, at least) among them have decided, at some deeper unconscious level, NOT even to heed any evidence, however obvious it becomes, of the deliberate dismantling of the constitution, nor to appreciate what it ominously portends. So even the most reasoned, fact-based arguments do not change their outlook, that they might even consider demanding accountability.

    In a land of heroes, we're in desperate need of heroes.

    And with regard to the previous Corzine-related post by the troll (obvious) accusing you of being racist for connecting Corzine to Obama, piss on him. I've been reading your blog for over a year now, am not a whitey, and you're one of the very last people I would even think of applying such label to. You don't need me to defend you, of course, but I just had to comment.

  5. double d...doesn't gensler look like dobby for harry potter.....he does right

  6. Gensler is ex-Goldman, and as head of CFTC he is a member of the PPT:

    Want to laugh until you cry? Then entertain the though that Gensler is at the CFTC to make sure futures markets work fairly without manipulation.

    Since Ted Butler thinks Gensler is honest and working for the public good, then I can only conclude that either (a) Ted Butler is a naive fool or (b) Ted Butler is one of the most brilliant deep-cover plants ever conceived by the bullion banks.

    I used to think (a), but I lean more towards (b) each day.

  7. LOL Daniel

    Thanks for the moral support anonymous. Not sure where the racist accusation would have come from. I actually was a supporter of Obama, although I didn't vote for him (I didn't vote) and I started to dislike him then hate him when he announced that Geithner was going to be his Treasury Secretary. I also hate every single Congressperson who didn't oppose Geithner's nomination.

    Stilicho, unless the Fed decides to let the Treasury go unfunded, I think more QE will cause all markets to go a lot higher. Not sure when this will kick in. Right now the large cap mining stocks are cheaper than they were when gold was below $1000 in Q2 2009 and the juniors are priced where they were when gold was $400/oz in 2003. I noticed today that silver and gold started to bounce from their London sell-off way before the SPX started to climb from its opening sell-off. I'd love to see the mining stocks and silve dislocate from their correlation to the SPX. But if they don't QE will fix that issue...

  8. Name any gov't official or bank exec that doesn't have two faces, two personalities, or two agendas?

    Geithner? Obama? Gensler?
    All whores.

  9. LOL Sumo. I've written about Butler's blind spot in years past on this blog. I may have posted something on it this year too. Butler's COT work and silver market analysis is brilliant. His evaluation of human nature is childish. I will say that lately he's come out and sharply criticized Gensler and the CFTC.

    Not only was Gensler a partner at Goldman, he was Corzine's highest lieutentant and if Corzine didn't get punted and replaced by Henry Paulson, then Gensler would have likely been the CEO after Corzine. He was on that path.

    There's no doubt in my mind that Gensler's role has been to protect the big Wall Street banks from being harrassed by the inconvenience of abiding by the laws. Of course, Gensler isn't the only one. Most of the other high posts in the White House administration are there for the same purpose.

  10. Try to forward...

    Why I Support Ron Paul

    Why Ron Must Run Third Party

    I support Ron’s attempt to get the Republican nomination even though I recognize that hell will freeze over before the Republican establishment allows him be chosen. Nevertheless, it is a smart move as he is exposing the lack of ideas amongst the Republican field and exposing them as the empty suits that they are. Other than him, they will all be puppets of TPTB just like Obama. I think that simply his running is changing the debate and converting more people to his perspective. So the big question is what should he do after the Republicans choose their new Wall Street puppet Romney. In my opinion, he must run as a third party candidate. No matter what he will not be returning to Congress so this is really his last shot and I actually think he can win as a third party candidate. Just imagine a debate between Romney, Obama and Paul. How will they respond to Paul’s strong defense of civil liberties. Or his attacks on the Federal Reserve system. Or his anti-preemptive war stance? They can’t and it will expose Romney and Obama to be the same guy on the important issues at play today. They will be shown once and for all as the empty suits that they are. Even if he doesn’t win, turning this whole thing around will not happen overnight. It is a process and him running as a third party candidate will further expose the two party system as the sham that it is and further accelerate the demise of both parties. In fact, I already think that by 2016 the Democratic party will be essentially a shadow of its former self and the Republicans may be as well if they continue on the path they are on much longer. To paraphrase Shakespeare. The tides in the affairs of men are changing. Neither political party can comprehend it.

  11. Army Considering Reprimanding Soldier Who Appeared With Ron Paul

    The US Army said Wednesday that it is considering disciplining Reserve Corporal Jesse Thorsen, the soldier who spoke out against a militaristic foreign policy at Ron Paul’s post-Iowa caucuses rally.

    After being cut short during a CNN interview Thorsen, who has served two tours in Afghanistan and was due to head back for a third, was invited on to the stage by Paul himself to address Paul’s cheering supporters.

  12. Did anyone notice phys is above 200dma while gld slightly below...interesting...and you have an undercut of low (shakeout) then recovery in a potential w (double bottom formation)

  13. Butler worked for Milkin nobody stupid worked for Milkin, corrupt, crooked thieves but stupid no.

  14. I honestly wonder what's going to occur first: gold $5000.00 or blood-drenched insurrection. The American people in general are fat, stupid brainwashed fools, but sooner or later, when the artificial social "safety net" breaks down and their bellies grow hungry, REAL CHANGE will happen in spades.

    That said, the delusional, criminal maniacs running this dying nation are more out of touch with reality than Louis XVI or Czar Nicholas ever were - when the shit hits the fan it's going to be a disaster of epic proportions.

  15. This is crazy........

    Martin Armstrong: Capital Controls Coming in the US
    Governments will become more desperate as debt piles up

  16. Hi Dave:

    you mentioned in last post 'in my book' (about CFTC head)....are you working on a new book? or already published? would love to read it!



  17. Paul Brodsky - Gold, Silver, Lost Confidence & Systemic Failure

    With 2012 off to a volatile start, today KWN wanted to speak with the firm that is calling for $10,000 gold to get their take on what readers should be focused on at this point. Paul Brodsky, who co-founded QB Asset Management Company, had this ominous warning for KWN readers globally, “It seems to me that we are getting close, we’re not there yet, but we’re getting close to a situation where confidence is lost as it relates to currencies and global monetary systems. We have a confidence based global monetary system. They are debt based currencies and we don’t have enough money with which to repay the debts.”Paul Brodsky continues:

    “We have fractional banking and there isn’t enough reserves in our banking system to cover the debt, let alone repay depositors should everyone come in at the same time for their money. Now we are starting to see this play out and I don’t think that MF Global story has permeated the psyche of Americans, but I think there’s a general unease of confidence.

    Certainly among investors we see this (unease of confidence) in volume and daily participation and trading. Investors are leaving the financial marketplace. I think it’s ringing loud and clear that we are seeing the status quo system of commercial trade and transactions and monetary settlements start to fade.,_Silver,_Lost_Confidence_%26_Systemic_Failure.html

  18. Mystery 'gold ingots' found on Paris train are fake

    The 'gold' bars found in the case did not have official stamps on them and have turned out to be fake Continue reading the main story
    Related Stories
    Gold hoard found in French cellar
    Twenty "gold" bars found in a case on a train near Paris last week have been found to be fake.

    A suspect package on board an RER train at Massy-Palaiseau station was examined by the bomb squad and found to contain what seemed to be 20kg (44lb) of gold.

    French police have now established that the bars are made of a base metal - with a thin coating of gold.

  19. Yes, Virginia, Brokerage Firms Keeping Client Ripoff Provisions in Customer Agreements in the Wake of MF Global

    In the wake of the collapse of MF Global, and the evaporation of funds in customer accounts, even ones with no margin lending, investors big and small have become duly concerned about the safety of their funds. For those of you who are not brokerage customers, one of the big achievements of the 1930s security law reforms was their success, up until now, in putting rules in place that protected customer assets. Numerous broker/dealers have failed but their clients’ funds were recovered.

    But it is always easier to steal with a pen than via more complex means. In support of our consumer protection efforts, reader Don H has sent evidence that the banks are keeping their rights to misuse customers firmly in place in the wake of MF Global:

    Just got a 20 page ‘client agreement’ from from Wells Fargo for a security account which contains some amazing (to me) stuff.

    It starts:
    “This is your Client Agreement. It includes the terms and conditions and is the contract that controls your securities accounts.”

    “Each account opened by you is a margin brokerage securities account, unless otherwise prohibited by applicable law or…” (so one can opt out but has to make a special request to set up a cash account. I wonder how many people who never deal in futures or short selling will realize they have a margin account?)

    “We may, at our sole discretion and without prior notice to you, prohibit or restrict your ability to trade securities and/or other property.” (They can shut you out of the market at their whim)

    “We may at any time and without giving you prior notice, use and/or transfer any or all securities and/or other property in any Account in which you have an interest, without regard to us having made any advances in connection with such securities and/or other property” (They can “MF Global” account holders without any further ado.)

  20. Hey Steve,

    I've thought about writing a book. But I was just using the term euphamistically. Thanks for encouragement on something I've thought about!


  21. Breaking News: Goldman Sachs Group Inc. Files 8k Form Initializing $15,000,000 in Gold-Linked Bonds

    It appears likely. But the major elephant in the room remains MF Global. The ramifications of their bankruptcy event have yet to be fully seen in the marketplace, and in this writer’s opinion, MF Global will be the first of many high-profile broker-dealer bankruptcies coming in the years ahead. Although short term pain, setbacks, and competing products continue to mount pressure on gold and silver mining share investors, when the final bankruptcy extinction-level event ripples through the global financial system, physical metal holders and mine owners will the be the kings and queens of tomorrow’s financial elite.

  22. Just the Ron Paul

    Recipe for a Revolution (A Sobering Warning)

  23. Anyone know the latest estimate on when the new Chinese precious metals market, PAGE, is going to open?

    I presume its opening will speed the the death of GLD, SLV, and COMEX: buy cheap 'baskets' of gold and silver via GLD and SLV, take delivery, and sell them dear on PAGE.

    At least a man can hope.

  24. MUST WATCH: Phil Donahue on Ron Paul & Foreign Policy

    He's is an unapologetic liberal, and still, Ron Paul's message makes perfect sense to Donahue.