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Coxe Advisors Discusses Ben Ben's Big Blues, Recommends Further Shift Away From Stocks
Coxe Advisors is out with its latest must read piece, in which Don Coxe tells readers it is time to once again reduce stock exposure, explains why gold will continue to outperform, and thus why it is a better investment than a 10 Year in the mid-2%'s, why fiscal stimulus is now too small to be effective which leaves Bernanke as the only saviour of the economy, and asks what experiments the Chairman has in store next: "Already, economists are discussing which Fed innovations lie ahead if the economy etiolates further. Among the suggestions for neat new ways to debase the Monetary Base: buying up large parcels of credit card and automobile debt. (Who knows? Maybe the Fed will become the nation’s biggest used car dealer. “Buy from Big Ben, Who’s Got the Biggest Deals!”)." All presented in Don Coxe's usual inimitable style.
While the full presentation is below, here are Coxe's key views on gold:
Explanations for Gold’s Recent Rise
1. Gold and the Dow
Pierre Lassonde, formerly of Newmont and now Chairman of Franco Nevada, is one of those who believes there are long-wave cycles between the Dow-Jones Industrials and gold. Historically, at some point gold and the Dow trade at the same price. The last time that happened was in 1980, just as Paul Volcker was starting to twist the monetary vise that would crush inflation, sending the US back into recession. Lassonde and his intellectual brethren believe that the two asset classes will meet again within a few years: they just don’t know whether that will be at $6,000, $8,000, or $10,000.
What kind of world would give us the Dow and gold at $6,000? The only thing one could say for certain that it would not re-elect a sitting President… or Prime Minister.
2. Deflation and the Decline and Fall of Banks and Sovereign Debts
Gold has been trading inversely to stocks in general and bank stocks in particular. On days stocks climb, gold usually falls; conversely on days the stock market is taking gas, gold climbs. It was, for example, a winner when Greece made it to the front page for the first time since the Olympics (and one of the few times the world had any good reason to take note of it since Alexander the Great). Because Greek banks and a surprisingly large number of other European banks had invested heavily in Greek government bonds after the nation managed to lie its way into the Eurozone, the potential default of the government threatened the recovery of the entire Eurozone economy. Germany was dragged along in the bailout, while appalled Germans watched TV coverage of overpaid Greek civil servants rioting. (The vigorous activity displayed was uncharacteristic of modern Greek civil servants, where a Lotuseater lassitude tends to be the lifestyle.)
Sovereign credits got a free pass in the Basel I rules (the virtuous, Volcker values, not the racy rules of Basel II for banks that wrote their own risk formulas and hid their most malodorous “investments” off balance sheet). Doubtless, Volcker felt he had to accommodate European sensibilities and didn’t want to be seen as the American imperialist in assigning different risk valuations to individual EU members. So the sudden threat of a Greek debt default sent Poseidon-scale shock waves through the Mediterranean, as other undercapitalized banks began to reflect on their coming descent into Hades if Italy, Spain and Portugal were to catch the Greek Reek.
The European Central Bank responded to the new global concerns by setting up stress tests for Eurozone banks. Nearly all the banks passed, which suggested to some skeptics that the Mediterranean had become Lake Wobegon on majestic scale. (Recent examinations of some eurobanks’ balance sheets by some smart analysts confi rm that cynicism.)
Through all this shock, hand-wringing, political battling, and fear of future shock, gold’s price continued to rise.
The European Central Bank-IMF rescue package was supposed to postpone Greek Tragedy and financial Medideaths for at least two years. However, Credit Default Spreads on government and bank debts in the region are once again climbing, and that has triggered a new all-time high for gold.
The Spring crisis opened a long-covered lesion deep within the German psyche. For the first time since the Weimar Republic, individual Germans, in an outburst of atavism, rushed to banks to exchange euros for gold. Angela Merkel’s party suffered its worst-ever defeat in the North Rhine-Westphalia election because of rage that Germany was participating in the Greek bailout. To punish her center-right party, they voted Socialist and even Communist. (Solidarity for never?) The voters had been forced to surrender their precious Deutschemarks for euros which, they were told, were even better. Once they figured out that the euro was a pudding that could contain poisoned raisins, they rushed to protect themselves. A currency that is not specifically and irrevocably backed by any government, any tax system, or any army and navy depends entirely on citizens’ faith. Many Germans who, despite the winds of modernism, kept their faith in God, also kept their faith in the Deutschemark. Now, a large proportion of the population apparently believes deeply in neither. (The US manages these possibly overlapping or interconnected belief systems with panache: greenbacks include the motto “In God We Trust,” which may be construed as a form of assurance if foreign exchange markets or infl ation raise Doubt among dollar-holders.) This Deutsche-angst, in which long-buried fears suddenly erupted across a broad swath of the population, was, we believe, an historic moment for gold. It could no longer be dismissed by sophisticated economists as merely the antiquated pre-Keynesian fixation of foreign exchange funds, or the delight of jewelers and people who might feel the need to leave their homeland under cover of night. It was suddenly the last remaining protection against cynical deals made by politicians and bureaucrats with each other in defiance of the wills of voters.
As we have noted previously, when the member nations agreed on the creation of the euro, they set up a committee to approve the faces that would appear on the new currency. This was going to be the triumph of the European dream—currency celebrating the people that had made the West the world leader in arts and science and philosophy. After years of increasingly frustrated meetings, they abandoned the project: they couldn’t agree on even one great European whose visage wouldn’t be offensive to some group of Europeans. Consider: If the new united Europe can’t agree on even one of such eminences as Leonardo, Michelangelo, Verdi, Mozart, Bach, Beethoven, Titian, Cezanne, Montesquieu, Descartes, Erasmus, Rembrandt, Dante, Goethe, Curie, Pasteur, or Liebig, why should anyone trust its paper money depicting buildings and bridges?
The euro’s loss is gold’s gain.
3. Inflation and Troubles for the Dollar and the Pound
From the time paper money came into broad circulation in the 18th Century, only two currencies have possessed global status—the pound and the dollar. (The euro was on its way to achieving that status until it slipped on Greece.) Both those currencies offered convertibility into specie—the pound into gold (until World War I) and the dollar into silver (until 1964). During each currency’s global dominance, it was backed by the world’s leading navy, a general commitment to free trade—and, until recently, a willingness to pursue and hang pirates.
World War I ended the pound’s global dominance, although the dollar shared space with sterling for a few years before assuming dominance during the Depression.
It is safe to say that no monetary theorist ever thought that the dollar could maintain its acceptability through another Depression, coming at a time when government debt exceeded 100% of GDP, or visualized a world in which derivatives on that debt and economy would multiply to $70 trillion. Or, for that matter, an industrialized world in which fertility and marital rates collapsed, and projected lifespans grew to nonagenarian levels while governments were on the hook for universal pensions and health care.
Quite simply, unless America moves decisively toward budget balance, (which may require that the threat from Islamic terrorism shrinks to mere nuisance status), it is hard to see how the dollar can remain the global store of value. Gold’s core inverse factor is the dollar—although it has more recently been trading inversely to the euro.
Those who sneer that gold has not outperformed Treasurys over the very long term ignore the fact that the basic financial projections for the US have not been this weak since the outbreak of the Civil War. Moreover, new gold mines were being discovered and developed across the globe for most of the past two centuries. No longer do new discoveries more than make up for declining production rates in existing mines. Indeed, most new deposits involve grades so low they would have been unthinkable even five years ago.
As Barrick’s Aaron Regent remarks, we may not be in the era of peak oil, but we may well have entered the era of peak gold.
Gold’s rather sudden emergence as the optimal hedge against recession-driven deflation and derivatives-and-debt-driven inflation has given it new luster. It has mitigated risks and saved people’s lives from tyrants or invaders for millennia. It is now the last best hope against governments’ willingness to create debts to fight downturns—even at the cost of the money that will be printed later to service those debts.
What worked in the stagfl ationary 1970s is now working to protect the wise against new kinds of government-spawned threats against the wealth remaining after the Lost Decade.
Conclusion: There will not be enough gold to satisfy the needs of the newly needy.
Full presentation below:
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This would be consistent. When the Fed can own the most real estate, mortgage backed securities, student loans, credit card debts, and autos, we can merely make defaulting on those things illegal (to protect the taxpayer, of course). Voila! Problem solved. (We already did that with student loans ... just a couple asset classes to go.)
Ah, to bring back the good-old-days of Dickens' Debtors Prisons ....
How long does the market at large allow this game to be played? Who would want to hold these securities when you have no idea what the REAL market is for them? You simply gamble that the Fed will continue to take share and/or won't exit the market too quickly. All the while, as you so nicely illustrate, moving us to a more "antiquated" form of property rights.. (and one the Founders would be violently opposing)
There are only three sources for the government to handle the US debt :
1. an increase in taxes
2. people increasing savings and putting them into government bonds
3. the Fed monetizing the debt, or some combination of all three.
You can put flags out on when one of those 3 options goes away. The increase is difficult without inflation, savings isn't working and they aren't putting their savings in bonds or 3. The Fed monetizes the debt. 2 is still possible but will somehow be forced (through pension funds or so). My money is on 3 and that is dangerous for the dollar. So if they every want to do that, we'll need a very strong reaction on the chinese policy. Once that happens, expect a dollar devaluation. And that might well be the start of the end.
The dollar is only in jeopardy if there are better alternatives.
Physical gold an silver are better alternatives. Dollar dies within a few years as reserve currency.
1. It is said that it is mathematically impossible for taxes to retire the debt, since all money comes into the US economy through debt plus interest. The interest is a liability in excess of all money created.
2. Again, people cannot save more money than exists.
3. Yes, and then the government can default on the debt to the Fed and a large portion of the useless money supply would just disappear. Why should the government pay interest on its own money supply. Seems counterproductive. yet, it may have been designed to control money creation ... such restraint has long since been discarded.
Here are my long-term assumptions:
1. The U.S.A. will never, ever default;
2. The USD will remain the paper currency of choice so long as the U.S.A. is the dominant military force in the world;
3. Gold will continue to trend up, but slowly.
4. Oil will grow more and more scarce; and everyone here can do that math.
In short, no sudden fortunes but precious metals and fossil fuels look good for a long, long time.
5. You are free from the Oligarch's clutches to the extent you are free from debt. I was pretty much pressed into buying a house last November but other than that I keep my books at zero in the long-term liabilities column.
The Achilles Heel for the U.S. Fed is oil shortage and nothing but. The whole shebang runs on oil.
Elementary, I know. But this is how I sleep nights.
privatized of course, listed on the amex.
Debtor prisons? These days we have Debtor McMansions.
http://azdailysun.com/business/article_1806b5b9-7bfa-51a4-aec6-7c1003c501bf.html
Yes, a short tour in the Ole Bailey works wonders for the weight control issues. Similarly, a short or long tour in the Bastille works wonders for the aristocracy.
With Uruguay designated a no-fly zone...
HELICOPTER BEN'S WALL STREET KLEPTOCRACY
http://williambanzai7.blogspot.com/2010/09/wall-street-kleptocracy-game....
Just 6 months ago, Coxe was pushing many commodity names in the stock market.
Now he's bearish again?
Man, these guys are constantly flip flopping and chasing last year's winners.
For now, as long as the CRX remains up over the 50-day and 200-day, the market is bullish and you should be long.
No, thats incorrect. Tyler does not include the sections of the report where Coxe states he prefers commodity equities to other equities. This from page 47, Investment Recommendations:
2. Within equity portfolios overweight commodity stocks. As a group, they have significantly less endogenous risks than the broad stock market.
3. Within commodity equity portfolios, use the four-sector approach. Its biggest overweight should be precious metals, emphasizing gold.
The difference from 6 months ago would be the increased emphasis on PMs.
I am not disagreeing with you on the market call for now, though. Even if it does not reflect underlying economic reality. And before somebody says 'oh its a bull, what an idiot', I suggest you try to understand that individuals can have a strong view on economic outlook, but have a position which does not mirror it ... for shorter term timing purposes.
Coxe and Cooper wrote an interesting piece for Bank of Montreal a few years back titled...
An Investor's Guide to Avian Flu - Dr. Sherry Cooper and Donald Coxe - BMO
Pandemics, Panic, and the Global Economy
http://www2.bmo.com/bmo/files/news%20release/4/1/Avian%20Flu.pdf
Most antivirals are now useless, the risks have increased. If you think that financial pestilence could also be joined by a viral plague, worth reading.
The fantastic thing about Dr Sherry Cooper is she makes even a dumbshit like me seem smart.
Good point. Coxe himself runs his Coxe Commodity Fund. T.COX.UN
I want to be very clear to you. The population of the world is going to fuck corporate earnings like they've never been fucked before over the next quarter.
The market is not bullish. The market is playing art of war. Pretend you're strong when you're weak. And they are staring at a cliff dive.
+1
Not sure that I agree contentwise, but what lovely imagery!
Glad to see that optimism survives.
Disagree. It'll happen in 2011 for earnings, ie: we will not see it in reported earnings until mid Q1 2011 earliest. As for correction, neither you, I or anyone else knows when it comes. All we can agree on is that it must come at some point sooner rather than later. In the meantime, the pain trade is up, for long only, hedge funds, retail and everyone on ZH. It sucks. Oh and as predicted, 2 junks for my earlier comment which doesn't fit the orthodoxy of the flat earth society ... and who fail to say who they are. Shame on you.
"Man, these guys are constantly flip flopping and chasing last year's winners. For now, as long as the CRX remains up over the 50-day and 200-day, the market is bullish and you should be long."
Well, looking at the chart above and using your 50/200-day rule, one would have been:
1) short from mid-May (CRX below 50 & 200)
2) neutral (CRX between the 50 & 200)
3) long in mid-June (CRX above the 50 & 200)
4) short late June
5) neutral/long mid-July
6) short again late August
Is that not flip flopping too?
Just asking
Chart: SI
Silver looks to have backtested the lip of a longer-term Cup and Handle.
http://www.screencast.com/t/NjFmNjZj
Cage match:
TA's cup and handle vs JPM's naked shorts
Charts: HG and CL
Copper looks like a short to me. http://www.screencast.com/t/NDU1MjUyZ
As does crude oil. http://www.screencast.com/t/NTVmZmY5
BoC setting interest rates @1% is the same as Bernanke setting interest rates @1% and staunchly promising that this did the trick. Did nothing, because rates declined anyway. In fact, its ironic, because raising rates in this fashion favoured holders of credit default swaps in the housing decline. So in my book, no magic here.
One thing people will ignore is that pension funds were banging down the doors at the minister of finance to get the right to 'insure' yeh- heh-heh, 'insure' mortgages.
Long term rates have declined to historic lows in Canada, and there is a humunguous corporate bond bubble called 'covered bonds' which are basically just another form of asset backed commercial paper. Except this time, the banks are exposed rather than the pension funds and brokerages dealing in this kind of thing.
You won't know until two weeks later what the effect of raising rates will have had, because you can't get daily updates from Canada's stuffy victorian banking system:
http://www.bankofcanada.ca/en/rates/tbill.html
One thing that might occur(and I may be totally wrong in this) is that the Canadian dollar will be affected in the decline in the markets this fall/winter, in that it may rise. I suppose the U.S. dollar to be limited in its ability to trade up against its trading partners due to the Yuan peg, which may be a boost for gold miners. In fact, there would be a whole transborder arbitrage between gold miner stock prices.
The Yuan is the Ruprecht of currencies hidden away in the basement of world finance.
We're in safe hands, Mark Carney the Governor of the Bank of Canada, is a Goldman Sachs alumnus. :-)
"Before joining the public service, Carney had a thirteen-year career with Goldman Sachs in its London, Tokyo, New York and Toronto offices. His progressively senior positions included co-head of sovereign risk; executive director, emerging debt capital markets; and managing director, investment banking. He worked on South Africa's post-apartheid venture into international bond markets, and was heavily involved in Goldman Sachs's work with the1998 Russian financial crisis.[5]"
http://en.wikipedia.org/wiki/Illuminati
Canada - we have a problem. OMERS has lost 6-Billion Dollars - in the city where I spend my summers, that amounts to about $15,000.- for every municipal employee and the ball is now rolling downhill gathering steam ($). House prices have stopped the up-tick and even small changes in the Bank of Canada rate adds bucks to the mortgage. Manufacturing in Ontario is only heading downhill and the deficits are California like with half the population. BUT - it is one of the best places to ride out the next decade however, there is no country exempt and the public sector will make sure of that.
Geez, enough with the gold already. What are you supposed to do, store your life's savings in a stack of gold coins in the basement safe and pray no one knows it's there? Or how about a safe deposit box that the Fed can seize at any time? Or what about GLD? Yeah, trust us, we have tons of gold...you can't have it, but it's there. I agree totally that gold will appreciate greatly, but as a practical store of value it just doesn't work.
What are you supposed to do, store your life's savings in a stack of gold coins in the basement safe and pray no one knows it's there?
You do realize that you're pathetic, yes? Just put your money with the advisor who has the best TV commercials and stop reading gold threads already...
I have to agree the gold discussion is a bit overwhelming at times here ha! To your question " What are you supposed to do store your life savings in gold coins ...", I doubt many here would recommend you store more than several years standard of living in PM. Living just outside a major city with 6 million people without dirt ( the ability to feed themselves pushed me to purchase a small parcel of land one mile from the nearest home surrounded by edible (corn) cover for housing,water (natural spring),garden space and timber for fuel. I am debt free now with a store of PM still trading today's markets taking advantage of value equity put options for small gains (love the C puts when C over 4) holding cash within my pension funds. I no longer advise friends, family or clients about positioning for a long depression, I have said all I can . Now I go about enjoying my time with family, friends and work prepared for the worst and the only down side could be zero return on investment, that I can live and sleep with ha!
Why don't you just skip over the gold parts. I could care less where you put your wealth. If you are uncomfortable with discussions about precious metals then perhaps you should look at your investment (wealth storage and management) choices. Feelin' guilty? The old axiom still holds true: Knowledge is power. Doesn't sound like you have a plethora of either.
are shtadlan Reb Shalom Bernookystein's "innovations" for the benefit of his kehilla, a.k.a. USofA, or the hofjuden? Or both? That's what I want to know.
" agree totally that gold will appreciate greatly, but as a practical store of value it just doesn't work."
..as opposed to what..food, dollars 1% bonds??
Let me suggest derrivatives, a true store of value.
Bottom line is that when sentiment, the economy, and safe haven plays are signalling "the worst is yet to come"..........
That is usually a buying opportunity in stocks, and one should be looking at bullish technical signals to position oneself on the long side.
Right now, the NYA is over the line, so I'm currently 80% long expecting a rebound.
They never make it easy, there are constant shakeouts and shank moves engineered by the operators.
But I'm anticipating more rotation out of safe havens back into stocks over the next few months.
If there is a sudden drop through the 50-day and 200-day, I'll switch and go the other way.
Looks like an open higher on the European bank capital ratios and China IP numbers.........play safe, be agile, stay on the right side of price.
Looks like the 50 and 200s have convergered Robot so a reverse may be a simple decision - 2 for 1.
Totally agree RobotTrader. Good to hear another trader's opinion.
Funny how this site has devolved into mainly end-of-the-world type dipshit comments where almost every thread degrades into discussion of bunkers full of gold and bullets.
I invite the retards to go ahead and junk away..... The world will actually end some day - its just that it is probably not tomorrows business.
And while you are waiting/wishing for the apocalypse, some of us like to continue on with the business of exploiting the markets for personal gain, which occasionally involves a strategy of being long.
The question is: is there is or is there aint a severe, possibly existential, economic crisis imminent?
To many here, most signs point to "yes".
There are some points in history where we find that the way things was aint the way things is gonna stay. This seems like a candidate for one of those points. The markets have lost their function, the treasury is on the verge of being totally discredited. Manufacturing is broken. Education is totally broken. A police state is emerging. And the government has become the total province of a financial and military mafia. And there is a monotonic trend of people waking up to all of the above.
If you want to go long, go long. But to me, the continuance of business as usual seems like a very bad bet at this juncture.
Good luck to you Fritz. (and Robo) If you can swing profits on this blip up, more power to you. Robo is sitting on some nice profits as he mentioned last week he got in early. Heck, with banks not having to comply with the new Basel requirements till 2017... (WTF??!!! I mean really?).. futures are up, up and away tonight. Just be cautious... with times being like they are, I am of the belief things can drop violently without a heads up. Hope you guys hedge! (or close out flat every night)
ditto
"Gold has been trading inversely to stocks in general'', then its Charlie Browns teacher, blah blah blah. Unless I misunderstand what inversely means (public school system semi-education).
BIG dip coming soon, Leo and Robottrader will be among the foolish buyers.
Why stay in an illegitemate market? Morally repugnant to trade with the enemy. If you dont get, you never will. Greed and idiots abound.
We can't we (in the US) do that?
How about IBM borrowing for 3 years at 1% when they pay a 2% divi?
Is the market betting on a reduction in IBM equity price over 3 years?
Normally you buy the common over the bond because you think the combination of dividends/ share price increase will exceed bond coupon.
Coxe says the market is pricing in deflation which is news to me.
Geez, enough with the gold already. What are you supposed to do, store your life's savings in a stack of gold coins in the basement safe and pray no one knows it's there?
Do like Richard Maybury said and Bury It - dont laugh, people have been burying gold for thousands of years.
Then you die unexpectedly and no one knows where you buried it...
why no article on HRE?? EUR40bn bailout (again) not enough to get a mention these days?!!
Any currency that is not freely valued by a freely available store of wealth, rather than by another medium of transaction (ie. another fiat currency), is dependent entirely upon citizen's faith, and what's more, is predestined to fail. Currencies need no backing to function as a medium of transaction, only to have a free mechanism by which the free market can value them.
Coxe, like almost everyone else, starts his analysis from faulty premises.
The inherent problem is more fundamental. All the currencies stink, because they all dictate that the citizen use the same thing for both the medium of transaction and the store of wealth. The needs of these two functions are incompatible.
When the "store of wealth" is debt-based, it becomes the question of The Chicken and the Egg.
Ironically, the Euro, being structured in full awareness of this fundamental problem, stinks the least. Coxe's conclusion about gold is also correct, ultimately.
Nice post, thanx for so much wisdom in so few words. The Euro still sucks though. To much political,
Karl Denninger rightly points out what is needed to put the US financial system back in balance, is to put a REAL COP on the block. Enough already with the joke fines and no real bite in the law. We need to put wrong doers out of business, and in jail with Maddoff. Bans of hedge fund market manipulators, HFT, would be a good start. A real cop on the block will hold the fed's feet to the fire for not obeying the federal reserve act, that is to control the aggregrate credit growth. Credit aggregates have outgrown the GDP, that is breaking the law. The fed has violated their charter every three months for 40 years. The goal of the fed. is to control the long term growth of credit aggregate not the money supply. The fed has broken the black letter law of the act. The result is the boom and bust cycle. A cop should put the cuffs on them. Make the banks go back to mark to market and take our lumps.
Gold backing of the US dollar would be a huge mistake. Problem is whoever controls the metal controls your economy and monetary system, ala WW3. All the gold is produced in Asia and Africa. If you want to put the Chinese and Somalians in charge of our monetary system than go to the gold standard. Of course we have a ballistic missle submarine fleet, which should be all the confidence anyone would need in the US. Confidence will be regained in the US markets and dollars, when we put things right with the thieves and liars. Let the treaury bail out the american citizens for a change instead of the corps (elites) and investment bank community. If you must back the dollar, than back it with something the us makes, coal, grain, something like this. It's time to clean out the Harvard and GS pukes.
"If you must back the dollar, than back it with something the us makes, coal, grain, something like this."
'backing' the dollar (or any other fiat currency) doesn't make any difference because it will still be a fiat currency
the game only changes when we get a CONVERTIBLE currency
with a convertible currency, the people get to decide whether they want to store their wealth in pretty pieces of paper or CONVERT those pretty pieces of paper to a tangible item
for a fiat currency backed by gold look no further than the Euro - at its inception the Euro was backed by 15% gold but nobody can take their Euros to the bank and convert them to gold - the gold backing was just a marketing strategy to help people accept the Euro
Thats great, And through all this bullshit analogy, You have Cramer staring at everyone on the rightside of the homepage. Thats the equivalent of Private Joker wearing a peace sign and writing Born to kill on his helmet.
Coxe oversimplifies and then spins the dirty oil issue as a disingenuous smear by ascribing the negative status of extremist upon individuals/organizations that are obviously attempting to bring the public to knowledge over the enviromental risks of mining tar on a massive scale;
"A campaign in Congress is being waged by enviro-extremeists to try to ban imports of 'dirty oil' from the (Alberta) oil sands".
The oil sands are/were once called the tar sands and for a reason.
To put the mining of tar in northern Alberta into a relatively simple context recent estimates of the prospective of the clear cut required to extract and process the tar into its oil production potential puts degradtion at an area roughly equivalent to the size of the State of Florida.
Coxe also fails to omit any mention of how the mining and processing of the tar into oil for the US and possibly China may impact ground water as vast reserves of fresh water are required to the process the tar into oil. Then there is the question over how the fragile ecosystem of Artic and the Arctic Ocean may be affected as the Tar Sands sit adjacent to the Athabasca River which is a primary watershed flowing some 750 miles through northern Alberta, into the Northwest Territories, into Great Slave Lake, the McKenzie River, the McKenzie Delta and into the Artic Ocean close to the Canada/Alaska border.
It does not take a degree in rocket science to grasp the concept that cheap, or relatively cheap oil has long been subsidized at the cost of the environment.
Just look south to the Guilf of Mexico and that BP polution disaster.
Where is George Washinton when we need him?
"To put the mining of tar in northern Alberta into a relatively simple context recent estimates of the prospective of the clear cut required to extract and process the tar into its oil production potential puts degradtion at an area roughly equivalent to the size of the State of Florida."
And watch as the ratfucking cocksucking technocrats try to get people to let them do it. Failing that means, they will circle the area with soldiers and choppers and call anyone who tries to stop them a Terrorist. They will do everything possible, despoil all resources if necessary, to keep the gravy train on track and stay in power. The desire for power over people is a leprosy of the soul and it is contagious. Oil supply is at the center of the game board.
To put the mining of tar in northern Alberta into a relatively simple context:
Alberta is in Canada, not the US. Canada is civilized enough to deal with this.
"Sovereign credits got a free pass in the Basel I rules (the virtuous, Volcker values, not the racy rules of Basel II for banks that wrote their own risk formulas and hid their most malodorous “investments” off balance sheet)."
Just saw the headline on another site;
"Basel III agreement announced: Global regulators agree to tripling of top-quality capital requirements."
This must mean sovereign credits get a triple free pass. 'Top quality' capital can only be government & government backed bonds.
Expect 'benchmark' yields to fall.
Updated DOW weekly chart:
http://stockmarket618.wordpress.com
Thank u, i found this for a long time.
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