Archive - Jun 2011 - Blog entry

The official release of the Pentagon Papers is big news this week. Ellsberg's support for Wikileaks and Bradley Manning is big news. But Ellsberg's other passion is receiving the "don't touch it" treatment ...

Meanwhile, in Athens…

Unitholders of TimberWest Forest, the largest landowner in B.C., approved the sale of the company Tuesday to two large Canadian public pension funds...

Here is an exclusive interview forwarded to me by German investigative journalist Lars Schall conducted with James G. Rickards. The interview with Mr. Rickards covers a variety of topics including his thoughts on quantitative easing, the currency wars of the past and the present, and central banks’ views towards gold.

This one's to all you Greeks out there...

For the Fed the failure to address any of the underlying causes of the Financial Crisis has been a great success story. After all, all it had to do was pump the financial system full of more money (increasing the amount of leverage) and push for the suspension of accounting standards (so the crap debt is still there, but no longer is visible).

In this respect, the war being waged against Greece by the European Central Bank (ECB) may best be seen as a dress rehearsal not only for the rest of Europe, but for what financial lobbyists would like to bring about globally.

In sum, I still believe the data supports betting with the market when the “dumb money” indicator turns bearish. It doesn’t work every time, but show me something that does.

Contrary to the popular view among economists that currency devaluation is necessary during periods of economic hardship, debasement works against the very investment that drives company formation and job creation given the tautological reality that any returns on investment will come back in cheapened money.

For the Fed the failure to address any of the underlying causes of the Financial Crisis has been a great success story. After all, all it had to do was pump the financial system full of more money (increasing the amount of leverage) and push for the suspension of accounting standards (so the crap debt is still there, but no longer is visible).

But no one was demoted, let alone fired. In fact, many of those who dropped the ball were PROMOTED, just like the knuckleheads who caused the economic crisis were PROMOTED to top posts.

Bernanke told the Japanese Central Bank what to do eight years ago. It is the same playbook for America today. It didn't work for Japan. It won't work for the USA either.

As stock markets massively turned the corner in the recent weeks, most sectors are looking into the abyss again. Even gold stocks were put out with the garbage, while the price of gold keeps leveling aloft $1,500. What’s the deal with these golden equities?!

Air Canada flying off course?

Remember, stocks tanked 16% after QE 1 ended in 2010. So far, we’re already down 6% and QE 2 hasn’t even ended yet! If we match last year’s post-QE correction, the S&P 500 will be at 1,144 soon after QE 2 ends. And given the numerous disasters (economic and financial) occurring in the world today, we could easily drop a lot further than that.