Kudos to a commentor who dug this story up. It turns out that the owner of Solyndra was a big source of campaign contributions to Obama AND Obama cut corners around the rules in place to get over $500 million in funding to Solyndra. Here's the report: LINK
Since this company just pissed away public money, I would suggest that we get to see a detailed look at the inside books so we can see just how much of that $500 million went into the bank accounts of the upper management.
Moreover, it sounds like many of Obama's political allies and fundraisers were beneficiaries of "green" loans from the Taxpayers. I don't know who the Obama supporters think they voted for, but I guarantee you that Obama is at least as corrupt as most of his predecessors. One of my biggest worries about him was that he was a product of the Chicago political "machine," which means there isn't an honest bone in his body...Please note that the story is from ABC News and not some conspiracy-theory addled source.
Wednesday, August 31, 2011
Another Obama Spending Idea Fails - Badly
And the Taxpayers get to take on the financial burden. Or at least the Taxpayers who have children and grandchildren get to let those poor souls pay for Obama's massively failed spending agenda. First it was the healthcare legislation, which has made healthcare a LOT more expensive for all other than for those who qualify for free emergency room care because they can't afford healt insurance. Then it was the $800+ billion stimulus program, which succeded in putting a lot of low-IQ people to work who stand around in bright orange vests and watch while one or two of their nicely compensated/benefitted colleagues work on putting in new gutters and curbs along streets that don't need them. And now Obama's alternative energy program takes a big blow as Solyndra, a solar energy company that received over $500 million in taxpayer money, filed bankruptcy. Here's the LINK
What I would love to know is how much the upper management of Solyndra paid itself from the time it got Obama's Taxpayer largesse donation and until it went into the tank. Because what Obama's faithful see as Government programs designed to make the world a better place are nothing more than the massive transfer of public wealth into the pockets of the upper management at the private companies who get Government contracts and public union employees, without any offsetting economic benefit. In fact, the only things Obama's grand designs have done for those who pay for them - the Taxpayer - has been the devaluation of the dollar and the massive increase in public debt.
Thanks Barack! And I'm sure the enriched to CEO of Solyndra has thanked you with campaign donations.
On another note, in a move that is increasingly becoming a trend for China and its big trading partners, it looks like China is in the process using the China yuan instead of the dollar in its trade with African countries. Here's the news report: LINK Anyone who thinks the dollar can't collapse because it has the full faith and credit of the U.S. Government is blind to reality. Just look at the above report - why would anyone put "faith" in that Government?
What I would love to know is how much the upper management of Solyndra paid itself from the time it got Obama's Taxpayer largesse donation and until it went into the tank. Because what Obama's faithful see as Government programs designed to make the world a better place are nothing more than the massive transfer of public wealth into the pockets of the upper management at the private companies who get Government contracts and public union employees, without any offsetting economic benefit. In fact, the only things Obama's grand designs have done for those who pay for them - the Taxpayer - has been the devaluation of the dollar and the massive increase in public debt.
Thanks Barack! And I'm sure the enriched to CEO of Solyndra has thanked you with campaign donations.
On another note, in a move that is increasingly becoming a trend for China and its big trading partners, it looks like China is in the process using the China yuan instead of the dollar in its trade with African countries. Here's the news report: LINK Anyone who thinks the dollar can't collapse because it has the full faith and credit of the U.S. Government is blind to reality. Just look at the above report - why would anyone put "faith" in that Government?
Tuesday, August 30, 2011
Things That Make You Go "WTF?"
I heard a funny joke today: Q: How do you starve an Obama supporter? A: Hide his food stamps under his work boots...Jobs are out there for many of those who want them, otherwise there wouldn't be people from Mexico sneaking into this country in order to work. But why work if the Government makes it possible for you to not work?...I wanted to point out that, per the most recent Government report on personal income report, LINK, that 18% of all personal income is derived from Government transfer payments. One way to think about this is to consider that a large percentage of the taxes you pay are taken and distributed back to certain segments of the population and counted as their income. I don't know about you but I believe that's just wrong. I suppose I could dig up the portion of my income that is taken from me and given to others, who contribute nothing to our system, but I'm not ready to move out of the country to an island somewhere yet and I might do that if I knew that number.
Einstein once said that the definition of "insanity" is to keep doing the same thing, over and over again, but expecting different results. I was reminded of this when I read comments by Gerald Celente in the King World News Blog LINK Celente has huge respect from me because his vision is very similar to mine. Sometimes I like to think he must have had my phone conversations taped back in the early 2000's, even though I think he's been a super-bear long before I saw the light. Anyway, Celente referenced the fact that a couple of years ago Nouriel "Gold is in a bubble" Roubini had said that gold would never reach $1,100. How's that forecast looking? Now Roubini is out pounding the gold bubble table once again. At some point you have to consider that maybe, according to Einstein's definition, Roubini is insane...Reminds of 2002 timeframe when gold was around $375 and Robert Prechter said that the gold was move over and that it was going to collapse to $50. Haven't heard from Prechter on gold in a LONG time. Maybe he's saving a bed for Roubini in the mental ward of Bellvue Hospital in NYC...
Einstein once said that the definition of "insanity" is to keep doing the same thing, over and over again, but expecting different results. I was reminded of this when I read comments by Gerald Celente in the King World News Blog LINK Celente has huge respect from me because his vision is very similar to mine. Sometimes I like to think he must have had my phone conversations taped back in the early 2000's, even though I think he's been a super-bear long before I saw the light. Anyway, Celente referenced the fact that a couple of years ago Nouriel "Gold is in a bubble" Roubini had said that gold would never reach $1,100. How's that forecast looking? Now Roubini is out pounding the gold bubble table once again. At some point you have to consider that maybe, according to Einstein's definition, Roubini is insane...Reminds of 2002 timeframe when gold was around $375 and Robert Prechter said that the gold was move over and that it was going to collapse to $50. Haven't heard from Prechter on gold in a LONG time. Maybe he's saving a bed for Roubini in the mental ward of Bellvue Hospital in NYC...
More On The Gold "Bubble" And Why It Isn't
I wanted to share a comment from a reader who happens to be a gold dealer. The other day I opined that the ratio of public sellers to buyers was about 9 to 1. This person says in his business the seller/buyer ratio is 10 to1. He also refutes the notion that just because gold dealers are advertising their business, it doesn't signify that it's a bubble indicator. I refuted this idea proposed by another blogger by explaining that grocery stores advertise aggressively everyday - is food in a bubble? Finally, he agrees with me that Glenn Beck is jack-ass. Here's his commentary:
The fundamentals and news keep piling up in favor of my view that there is a very high probability that we will get a big move in gold between now and year-end. Again, this won't come without opposition from the banking establishment, which means big moves in both directions. Furthermore, just as Bernanke has his "tools" to stimulate growth, the CME still has its tool - margin hikes - to try and temporarily suppress the move higher in gold. If you trade this market, tread carefully. If you are simply converting fiat monopoly paper into physical gold and silver, just buy now and buy more on every price smack. If you think you own gold because your brilliant financial advisor has some small part of your investments in GLD and SLV - you don't - you own fiat monopoly paper and eventually those two "trusts" will be "Enronized."
As a professional numismatist of 24 years, we have been buying huge amounts of scrap alongside some serious coin collections. Last Wednesday, our New York office spent $250,000 buying. More than half of it from one client selling gold coins.
As for a bubble, definitely not. In London I have 10 sellers for one buyer. That will not reverse until the economy picks up and people start making money again. Then they will return and buy the coins they sold to buy food or pay the mortgage or meet their payrolls.
But what I really want to say is the amount of people we have saved from ruin. It is all well and good being high and mighty about us misleading people to sell, but you do not sit in front of the people whose houses, and business we saved, using my savings, my children’s inheritance. Are we not allowed to make a profit?
I personally had a lady last week with eyes brimming with tears selling literally everything she had to pay bills. We worked on the thinnest of margins to help her out, about $2 a gram profit. I AM LOSING MONEY ALREADY. Money that is my family's, my children’s future and everything I worked to save. Ten years ago we couldn’t give gold away at $250 an ounce, now everybody is an expert and we are parasites.
According to 24Hourgold the premium on silver is 30% above spot, yet it will never ever be bought for such a premium, so fools are listening to idiots like Glenn Beck and just giving money away. When they sell, and I give 10- 20% below spot I am again called a parasite and Beck is the hero.I also wanted to highlight a very significant factor driving up the price of gold - Indian and Asian buying. The Central Banks and populations of these countries are loaded down with paper currency and they are aggressively converting it into gold. Given that these civilizations have been around and doing this for a couple thousand years, as opposed to the meager 240 years of U.S. civilization, I have to believe that they are on to something. Here's two excerpts from the "JBGJ" report, which can be sourced in the nightly "Midas" report at www.lemetropolecafe.com:
Gold and rare coins are financial insurance. Quality, physical assets that provide emergency funding when you need it most. The market is functioning exactly as it should, and we are providing liquidity-for-a-profit to people who need it most.
(this one is from a London-based bullion bank) “Our sales to India were more than twice the average daily volume, but then again at higher prices we'd seen good demand this week overall. Indeed, even if India didn't buy anything today, this would be the best week for Indian physical sales since May. Yesterday was also a holiday in India, and this likely depressed demand; we expect a stronger buying response today.”
(And this one is JB's comment with regard to the very high premiums being observed right now in Asia, which is indicative of huge demand) Possibly the Chinese public is more enthusiastic than others about the recent gold pull back being a buying opportunity. But JBGJ cannot forget that the unprecedented appearance of double digit premiums last year heralded the huge Chinese gold import binge at the end of the year. That seemed to be associated with an inflation scare in China. This concern seems to be picking up momentum again – see today’s Reuters story China plans to mop up bank liquidity to battle inflation . The world has little experience of China as a major gold importer – until last year, imports although much hyped were quite modest.And finally, two more Fed Governors have announced that they are not opposed to more Quantitative Easing by the Fed, including one - Kocherlakota - who had been one of the three dissenters at the most recent FOMC policy meeting. Here's the news links: QE3; And More QE3
The fundamentals and news keep piling up in favor of my view that there is a very high probability that we will get a big move in gold between now and year-end. Again, this won't come without opposition from the banking establishment, which means big moves in both directions. Furthermore, just as Bernanke has his "tools" to stimulate growth, the CME still has its tool - margin hikes - to try and temporarily suppress the move higher in gold. If you trade this market, tread carefully. If you are simply converting fiat monopoly paper into physical gold and silver, just buy now and buy more on every price smack. If you think you own gold because your brilliant financial advisor has some small part of your investments in GLD and SLV - you don't - you own fiat monopoly paper and eventually those two "trusts" will be "Enronized."
Monday, August 29, 2011
Economy In A Tailspin; Get Ready For Some Serious Socialism From Team Teleprompter
Pending home sales for July were reported down 1.3% in July this morning. The "spin" put on this was that the index was 14% above last July and the NAR chief idiot, Lawrence Yun, commented that it was above the "low" for April. I almost don't want to shred that statement because it is so stupid. To begin with, April is still part of the "dead" season for housing. Conversely, July should be one of the peak selling months. Moreover, a trend of high contract cancellations began in May and June, and I expect it to continue in July. July will thus be worse than initially expected as indicated by the Pending Sales index. Quite frankly, it looks like the entire 2011 selling season will be dead. Here's the news report: LINK
In addition, the Dallas Fed released its regional manufacturing index for August this morning. It declined substantially from July and is close to going negative. And it was well below the consensus Einsteinian group of highly paid Wall Street economic clan, who can't seem to hit the broad side of Adam Smith's barn with their forecasting. Here's the report: LINK As you can see, almost every single input variable was negative, indicating the likelihood of serious economic contraction in the region. This report is consistent with those from Chicago, Philly and Richmond. Collectively I would expect, short of some incredible David Copperfield-esque perception manipulation from the Government, that we will see a negative GDP print for Q3. I also think we could see a negative print for Q2 when the Government reports its final revision on September 29th.
To address the above situation, I expect at some point that the Fed will roll out some sort of massive money printing program in conjunction with a massive "stimulus" program to be unveiled by the Teleprompter early September. Expect that we are going too see a MASSIVE transfer of wealth from Taxpayers to the housing sector. As an example, take a look at this article from Bloomberg detailing how the Government is now largest home seller. Here's the kind of policy response we'll get from the Teleprompter and his Big Government solution:
In order to justify his Big Government policies, the Teleprompter has announced the appointment of Bernanke's academic colleague, Alan Krueger, to be his chief economic advisor. I couldn't find a lot about Krueger's economic views other than he's some kind of expert on education and minimum wages. Given that he's a Princeton economist, I would also suspect that he heavily buys into Keynesian policies, which have demonstrated utter failure in practice. Krueger has never had to work in the real world and thus has no grounding in reality. Expect a very heavy dose of Government programs designed to spend Taxpayer money putting people to work building a lot more useless infrastructure projects and bridges to nowhere. Also expect a heavy dose of education subsidies and bigger student loan programs. All of this, mind you, paid for using printed money and much higher Government borrowing. Here's summary from Bloomberg on Krueger, which is consistent with the information I found using google: LINK
It's getting nice and cozy in the Oval Office now, with the Teleprompter doing a great job reading the scripts prepared for him by his chief of staff, ex-JPM director William Daley, and now his new chief economic advisor whispering sweet nothings into his ear about spending a lot of borrowed money for infrastructure projects and student loans. Based on his academic background I expect Krueger - in a move right out of Atlas Shrugged - to lobby hard for a big increase in the minimum wage as well. I'm shrugging right now because Big Government always fails and it transfers a lot of wealth to the elitists in the process.
It's getting really ugly out there on Main Street and in DC. With all this coming money printing and Government "stimulus," I expect to see - on balance - a big rally in the price of gold and silver, especially as we now entering the prime Indian buying season and the Chinese demand for gold is accelerating. This won't come without a lot of volatility, which will include some aggressive by attempts by the Fed and its bishops - the bullion banks - to force some big down days. Buy these as best you can.
In addition, the Dallas Fed released its regional manufacturing index for August this morning. It declined substantially from July and is close to going negative. And it was well below the consensus Einsteinian group of highly paid Wall Street economic clan, who can't seem to hit the broad side of Adam Smith's barn with their forecasting. Here's the report: LINK As you can see, almost every single input variable was negative, indicating the likelihood of serious economic contraction in the region. This report is consistent with those from Chicago, Philly and Richmond. Collectively I would expect, short of some incredible David Copperfield-esque perception manipulation from the Government, that we will see a negative GDP print for Q3. I also think we could see a negative print for Q2 when the Government reports its final revision on September 29th.
To address the above situation, I expect at some point that the Fed will roll out some sort of massive money printing program in conjunction with a massive "stimulus" program to be unveiled by the Teleprompter early September. Expect that we are going too see a MASSIVE transfer of wealth from Taxpayers to the housing sector. As an example, take a look at this article from Bloomberg detailing how the Government is now largest home seller. Here's the kind of policy response we'll get from the Teleprompter and his Big Government solution:
The government’s housing inventory is just one challenge facing President Barack Obama as he prepares to run for re- election next year. The administration also is exploring ways to help hard-hit neighborhoods, unemployed homeowners and underwater borrowers whose houses are worth less than what they owe -- many of them concentrated in battleground states including Florida, Ohio and NevadaHere's the link and try not to weep while you read it: LINK
In order to justify his Big Government policies, the Teleprompter has announced the appointment of Bernanke's academic colleague, Alan Krueger, to be his chief economic advisor. I couldn't find a lot about Krueger's economic views other than he's some kind of expert on education and minimum wages. Given that he's a Princeton economist, I would also suspect that he heavily buys into Keynesian policies, which have demonstrated utter failure in practice. Krueger has never had to work in the real world and thus has no grounding in reality. Expect a very heavy dose of Government programs designed to spend Taxpayer money putting people to work building a lot more useless infrastructure projects and bridges to nowhere. Also expect a heavy dose of education subsidies and bigger student loan programs. All of this, mind you, paid for using printed money and much higher Government borrowing. Here's summary from Bloomberg on Krueger, which is consistent with the information I found using google: LINK
It's getting nice and cozy in the Oval Office now, with the Teleprompter doing a great job reading the scripts prepared for him by his chief of staff, ex-JPM director William Daley, and now his new chief economic advisor whispering sweet nothings into his ear about spending a lot of borrowed money for infrastructure projects and student loans. Based on his academic background I expect Krueger - in a move right out of Atlas Shrugged - to lobby hard for a big increase in the minimum wage as well. I'm shrugging right now because Big Government always fails and it transfers a lot of wealth to the elitists in the process.
It's getting really ugly out there on Main Street and in DC. With all this coming money printing and Government "stimulus," I expect to see - on balance - a big rally in the price of gold and silver, especially as we now entering the prime Indian buying season and the Chinese demand for gold is accelerating. This won't come without a lot of volatility, which will include some aggressive by attempts by the Fed and its bishops - the bullion banks - to force some big down days. Buy these as best you can.
Sunday, August 28, 2011
The Idea That Gold Is In A Bubble Is Idiotic
And the promoters of this idea are complete morons or completely corrupt. This morning I heard an ad on the radio by an outfit called Empire Diamond explaining that they wanted to pay the best price in the market to by your gold and silver in any form (i.e. jewelry, silverware, junk, etc). Their tagline was "Don't wait for the price of gold to drop before you sell." LOL. Then I open the front section of the Denver Post and the center pages featured a full-color ad from The Great Estate Roadshow, which will be set up in 4 locations around Denver all next week and it wants to buy any and all scraps of gold/silver that you want to sell them. The ad was like a Playboy centerfold featuring a very detailed reproduction of all the items the outfit will buy. This ad is not cheap and neither is the event being staged, meaning that some outfit is spending a LOT of money to try and coax the public into unloading their gold and silver in any form. The question is, who wants to buy it so badly? It also indcates that public is still selling a lot of gold and silver and has a lot left to sell. That is not the sign of an asset in an investment bubble.
Every time I turn on the news media or open the newspaper I encounter "experts" and gold/silver buyers counselling the public that price of gold is going to fall. They never ever suggest that the price might actually go up. Contrast this with the internet/tech stock bubble and then the subsequent catastrophic housing bubble: how many promoters were telling the public that the price of these "investments" could actually drop?
It never ceases to amaze me the extent to which profit-seekers will go to in order to separate the public the from their money. For anyone questioning the strength and longevity of the gold bull, I ask you to consider that the marquee indicator of an investment product in the peak frenzy of a bubble is the endless aggressive promotion to seduce YOU into buying THEIR investment - not THEM seducing YOU to sell them your's. Some things will never change and snake-oil salesmen fleecing the public in one way or another is one them and the idea that an investment can be considered a "bubble" when the public is still being aggressively seduced to sell is another.
That so few of people in this country understand why gold and silver are doing what they are doing further adds to the basic fundamental factors pushing the precious metals higher. This is reinforced by the fact that so few large institutional investors understand the dynamics driving metals higher and fiat currencies lower. In fact, I saw one "expert" mutual fund manager recommend getting long the dollar last week. Next time you hear that gold and mining stocks have peaked and the bubble has popped, open up the quarterly report from your favorite mutual fund and see what percent of the fund is invested in mining stocks. I would bet it has no exposure. Until you see your mutual fund investments heavily invested in precious metals and mining stocks, you can be assured that the bull market in this sector has a long way to go.
Every time I turn on the news media or open the newspaper I encounter "experts" and gold/silver buyers counselling the public that price of gold is going to fall. They never ever suggest that the price might actually go up. Contrast this with the internet/tech stock bubble and then the subsequent catastrophic housing bubble: how many promoters were telling the public that the price of these "investments" could actually drop?
It never ceases to amaze me the extent to which profit-seekers will go to in order to separate the public the from their money. For anyone questioning the strength and longevity of the gold bull, I ask you to consider that the marquee indicator of an investment product in the peak frenzy of a bubble is the endless aggressive promotion to seduce YOU into buying THEIR investment - not THEM seducing YOU to sell them your's. Some things will never change and snake-oil salesmen fleecing the public in one way or another is one them and the idea that an investment can be considered a "bubble" when the public is still being aggressively seduced to sell is another.
That so few of people in this country understand why gold and silver are doing what they are doing further adds to the basic fundamental factors pushing the precious metals higher. This is reinforced by the fact that so few large institutional investors understand the dynamics driving metals higher and fiat currencies lower. In fact, I saw one "expert" mutual fund manager recommend getting long the dollar last week. Next time you hear that gold and mining stocks have peaked and the bubble has popped, open up the quarterly report from your favorite mutual fund and see what percent of the fund is invested in mining stocks. I would bet it has no exposure. Until you see your mutual fund investments heavily invested in precious metals and mining stocks, you can be assured that the bull market in this sector has a long way to go.
Friday, August 26, 2011
Russia Moves Closer To A Gold Standard And A Quick Comment On Bernanke
Kudos to "Ranting Andy" for sourcing this story. Russia's Central Bank has announced a program to offer short term, gold-backed loans LINK It's not clear to me if this facility will will be available only to Russian banks or if non-Russian banks will have access to the program. What IS clear to me is that the Russian Central Bank, which has been an aggressive monthly accumulator of physical gold, has decided to include gold, along with high-quality bonds, as part of its acceptable collateral policy. It would not surprise me to see more eastern Central Banks offer gold-backed loans. And eventually I suspect that these Central Banks will no longer accept sovereign-issued bonds, like Treasuries, as loan collateral.
As for Bernanke's speech at Jackson Hole today, I thought it was a pathetic attempt to vindicate himself and place the failure of his monetary policies squarely on the shoulders of Congress and the White House. To blame the current economic weakness on the debt-limit debacle is utterly absurd. And in the epitome of hypocrisy and disingenuousness, he lectured that Congress needed to be more "transparent" with and accountable for its legislative procedures and objectives. I really can't believe he made a statement like that considering the fact that the Fed spent millions lobbying Congress to kill Ron Paul's audit the Fed bill. Quite frankly, and quite alarmingly I find Bernanke to be one of the more deceitful and spineless public figures in my lifetime. Nixon would be embarrassed by Bernanke's antics.
Looks like BP's oil well in the Gulf of Mexico is leaking again: LINK We can only hope, contrary to what is likely the case, that Obama did not negotiate a "fence" around BP's liability and that the corrupt oil company will be held financially accountable for its crimes. Of course, given that the Teleprompter's track record has been to alleviate corporate accountability, I'm sure he gave BP a get-out-of-full-liability card last time around the monopoly board.
On a final note, I hope anyone reading this who owns/owned Bank of America stock took yesterday's price action as an opportunity to unload their shares or any mutual funds that have a big holding in BAC. BAC is desperate for liquidity and I would bet a 1 oz. gold eagle that Buffet's deal with the 5% takeout premium was structured as a short term "bridge" deal to keep BAC liquid until a bigger bailout can be put in place, at a time that makes it politically feasible, and takes Buffet out at that 5% premium plus accrued information. God bless crony-capitalistic insider trading!
As for Bernanke's speech at Jackson Hole today, I thought it was a pathetic attempt to vindicate himself and place the failure of his monetary policies squarely on the shoulders of Congress and the White House. To blame the current economic weakness on the debt-limit debacle is utterly absurd. And in the epitome of hypocrisy and disingenuousness, he lectured that Congress needed to be more "transparent" with and accountable for its legislative procedures and objectives. I really can't believe he made a statement like that considering the fact that the Fed spent millions lobbying Congress to kill Ron Paul's audit the Fed bill. Quite frankly, and quite alarmingly I find Bernanke to be one of the more deceitful and spineless public figures in my lifetime. Nixon would be embarrassed by Bernanke's antics.
Looks like BP's oil well in the Gulf of Mexico is leaking again: LINK We can only hope, contrary to what is likely the case, that Obama did not negotiate a "fence" around BP's liability and that the corrupt oil company will be held financially accountable for its crimes. Of course, given that the Teleprompter's track record has been to alleviate corporate accountability, I'm sure he gave BP a get-out-of-full-liability card last time around the monopoly board.
On a final note, I hope anyone reading this who owns/owned Bank of America stock took yesterday's price action as an opportunity to unload their shares or any mutual funds that have a big holding in BAC. BAC is desperate for liquidity and I would bet a 1 oz. gold eagle that Buffet's deal with the 5% takeout premium was structured as a short term "bridge" deal to keep BAC liquid until a bigger bailout can be put in place, at a time that makes it politically feasible, and takes Buffet out at that 5% premium plus accrued information. God bless crony-capitalistic insider trading!
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