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Jim Willie – USDollar: Ring-Fenced & Checkmate

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Jim Willies has posted an article which he claims is his most important yet. In it, Jim touches on concepts that others have discussed but he describes the end games for the US dollar as the power shifts from the West to the BRIC nations. The trade agreements are being set up, the BRIC bank will use US bonds to fund the infrastructure that will be needed. US Bonds will also be dumped by funding the gold purchases required to back the “new monetary system”.

The full article can be read at SilverDoctors, but I have outlined some of the interesting bits below.

BRIC FlagsAn unstoppable sequence of events has been put into motion finally. The pressure has been building for months. Some themes are plainly evident, except to those who wear rose colored glasses in the US Dome of Perception. The USTreasury Bond will be brought home to the US and British banks, where it will choke its bankers, then be devalued for survival reasons, after a painful isolation. The Chinese and Russians will conspire to finance the Eurasian Trade Zone corridor foundation with USTBonds, held in reserve, put to usage. The British will play a very unusual role, selling out the United States in order to be squires to the Eastern Duo. The process has begun; it cannot be stopped. The events are already being grossly misinterpreted and minimized in the US press, where devoted lapdogs, artistic swindlers, and creative writers prevail. The Paradigm Shift eastward is showing its next face, with a truly massive trade zone for cooperation and reduced cost overhead as the giant foundation. The Untied States for all of its past hegemony and devious manipulations and vicious attacks, will be excluded. The British will assist in the exclusion in order to avoid the Third World themselves. The following blueprint is the result of years of planning, with steady information and hints and confirmations by at least two Hat Trick Letter sources. The sunset of the USDollar has a blueprint.

EURASIAN TRADE ZONE

The crowning blow is the financial centerpiece to the trade zone, which draws upon the critical mass bulk of the BRICS nations as nucleus. Together Brazil, Russia, India, China, and South Africa have begun to form an alliance built upon trade and economic development, forged by investment in infrastructure and its construction. Include Iran and Indonesia to welcome the new BRIIICS nations for a larger Eastern representation. The arterial system of the trade zone will be energy supply, the life blood of commerce. The Eurasian Trade Zone is being formed, with an energy foundation. Important bilateral pacts were made concrete in the last week. Supply of crude oil, natural gas, including LNG, will come from a vast system of pipelines from Russia to Central Europe and from Russia to China.

BRICS DEVELOPMENT BANK

Consider the BRICS Development Bank. It is so much more than a fund to build railroads in remote African locations, as the delusional US press reports. It will form the giant credit line for countless projects upon which trade will be conducted, often called infrastructure, but so much more. It will gradually reveal itself to provide a second function, a core bank for trade payments outside the USDollar sphere.

EXCLUSION OF UNITED STATES

The many years of abusive control of the FOREX currency markets, intervention in the sovereign bond markets, manipulation in the important commodity markets, devious propaganda in the communications networks, with support role played by the aggressive USMilitary and nefarious activity by its security agencies have guaranteed exclusion of the United States. The unspeakable abuse of the US$ credit card will end, as the global reserve currency is dismissed from its throne.

BRITISH BROKER ROLE & INTRIGUE

The British have an historical knack to remain on top of the bank center heap. Earlier this year, when they announced the launch of a Chinese Yuan Swap Facility in London City, they stepped on the New York neck

……

Both Bank of America and Citigroup are brokering a $55 billion deal that will enable Rosneft to become the world’s largest oil company. Several hidden messages are laden within the blockbuster global changing deal by Rosneft. By dissecting the flow, it is clear the BP executive staff is selling out, since not paying dividends. The collateral for the deal toward the loans will come from USTreasury Bonds.

……

Witness a potentially crucial London role in helping the Eurasian Trade Zone, perhaps buying favor to avoid the Third World. The broad exclusion of the United States guarantees a Third World flavor and stench for the North American core, with a Mad Max overtone and a Dachau closet.

DEVIOUS CYPRUS HIDDEN ANGLE

A piece of the financing for the Rosneft deal came from GazpromBank, which operates out of Cyprus. China has posted $30 billion in USTBonds as collateral within the massive deal, in return for ample future crude oil supply. Since Russia will receive a steady flow of payments from China from diverse energy pipeline supply, in the form of USTBond fund flow, the big debt to the London banks will be paid off by USTBonds. The payoff will be in the same terms of the huge collateral. Conclude that the Eurasian Trade Zone will have an energy pipeline and delivery system with loaded supply whose foundation is built upon USTBonds, sent back to the Anglo-American bankers to digest. The USTBonds are going home to die.

USDOLLAR HEGEMONY ENDING

The alternative system to conducting trade outside the USDollar system has had formative stages since the Lehman Brothers and Fannie Mae collapse. The Eastern trade leaders have been very busy quietly constructing a new system, with almost zero press coverage. They prefer to work in the background. Recent events indicate they have chosen the formal public stages and forums with wider visibility, starting with the February G-20 Meeting in Moscow. The true agenda for G-20 finance ministers was to hatch finally the USDollar alternative.  The sleepy West appears not to be paying much attention. The initiatives to construct alternative platforms were given a major thrust in the last year since the Iran sanctions led by the USGovt banker and their henchmen in London. For the last 20 years at least, trade has followed banking. Nations of the world have been coerced for three decades into holding USGovt debt securities in order to make payment in trade, most notably in crude oil. With the Grand Arab Recycling accord struck by the 1970 decade leaders, the Petro-Dollar was born in return for a fantastic higher oil price. The oil-rich Arab royalty supported the USDollar by recycling trade surplus into USTreasury Bonds. The conventional practice dictated that global banking systems be dominated by USTBonds in reserves, serving as the banking foundation of debt.

 

New chapter to turn. The ongoing endless QE to Infinity has hastened Eastern trade leaders. The near 0% return from USTBond yields has motivated them to seek alternatives. They are horrified by the debasement of their hard-earned reserves, filled to the gills with USTBonds of shrinking value and low yield. The new trade settlement system based in Gold finance will turn the tables, as once more trade is to dictate banking. The combination of central bank hyper monetary inflation, big US bank fraud, security agency $100 bill counterfeit, and rampant criminality in the US financial system has motivated the Eastern nations to act. They have acted. The clear outcome is that the Western banking system will topple, since the East will be shoving the USTBonds back to Anglo-American shores for cemetery treatment. Trade should always dictate banking. The major trade partners no longer want US$-based trade settlement. Watch for the crowning blow in the Saudi response soon, since they always follow the winners.

THE CENTERPIECE PLAN

The new BRICS development bank will surely be supplied with USTreasury Bonds at first. The primary seeding is obvious. The emerging nations have collected huge reserves from successful trade over the last decade, primarily held in USTBonds. They do not wish to hold them, since undermined and debased by their own steward at the US Federal Reserve. The big Eastern nations have committed $100 billion for the fund, whose liquidity lies in USTBonds. On a gradual ramp, the USTBonds will be converted to Gold bars for the core bank asset in the development fund. Some of the 6000 metric tons of Gold bullion removed from London banks by the Eastern entities from March to July 2012 might find their way into the BRICS Fund core. The initial role of funding critical important projects like pipelines, communication networks, railroads, shipping ports, ships & trucks, perhaps even energy transfer ports, will become clear. The more overarching role of forming a (Eastern) global core central bank clearing house for payment transactions will be its second dual role. The emerging nations have had their fill of the USDollar control mechanisms with the SWIFT bank structure, the Intl Monetary Fund steering committee, and others. Finally, Gold Trade Notes would be used in trade settlement. Witness the new Eastern Fed for trade settlement in Gold bullion. Better to call it the BRICS Development Fund, since a major Trojan Horse for excreting USTBonds through its rectum, the London Boyz busily catching it.

The Gold core will facilitate the purchase of Gold Trade Notes much like the common letters of credit used widely in commerce nowadays. Like the Eurasian Russian-Chinese energy foundation, the development fund will be built on the back of USTBonds in toxic discharge. In the process, expect extreme hardball, shoving the toxic USTBonds back into US and British banks, as collateral for huge loans, as funds for repayment of huge loans, as funds to purchase Gold. In the process, the COMEX with LBMA appendage will be drained of its Gold, a future default assured. The Western gold marts will be unmasked as corrupt dens of empty inventory shelves. What comes is a BRICS Development Fund which will serve as a quasi global gold central bank for the expressed purpose of facilitating trade settlement in Gold. This is hardly just a fund to finance African rail projects.

THE CHECKMATE

A checkmate is in progress. It has four important elements.

1)    The established Eurasian Trade Zone joins the massive Asian continent with a significant portion of the European continent, where three quarters of the world population resides. The trade zone has no visible presence or participation by either the United States or United Kingdom.

2)    The BRICS Development Fund will control a giant sum of $100 billion. It will eclipse the role of the Intl Monetary Fund. The fund will facilitate numerous infrastructure projects. However, its other feature will be the shocker, as its core is transformed into Gold bullion. The conversion of USTBonds to Gold will nail the coffin in the isolated USDollar, a topic of Jackass scribbles for the last full year.

3)    The flow of USTBonds will be from China to London, for financing the foundation of the Eurasian Trade Zone on its energy backbone with brisk energy flow. The collateral for large loans is to be USTBonds, as is repayment for loans to be USTBonds.

4)    The transition from Yuan-based trade settlement via the numerous Swap Facilities in barter trade with key nations, toward Gold trade settlement via the BRICS fund that will feature a gold core, will launch the new Gold Trade Standard. It will not be a banker dominated currency type of Gold Standard. It will instead be a trade settlement Gold Standard that bypasses the hegemony of the Anglo-American banking system, the SWIFT rules, the FOREX gaming, and the IMF/World Bank harlots that harbor insects.

………..

  • The BRICS Development Fund is the main event, to build a railway to a dark place for the United States, ring fenced for its toxic USDollar. Gone will be the corrupted motivated tools like the IMF and World Bank, with even Western central banks of lesser importance. The BRICS Fund could be the Trojan Horse (much like ObamaCare) that permits a vast conduit to be built, a seemingly innocuous let permitted entrance through the door, which permits USTBonds to be dumped like the trash.

  • The upcoming Gold purchases by the BRICS Fund might be coordinated with the Shanghai Metals Exchange, to exploit the artificial low London Gold price. A COMEX bust can be foreseen.

  • The BRICS should be careful about the new undersea global communication cable system. In 2007, foul play resulted in the Iranian cable being cut, the result of cooperative action by the USGovt and the little ally on the Southern Med that looks northwest to Italy.

  • The tipping nation is Germany, which has had its fill supporting the slower wasteful debt-ridden Southern European nations. After cutting the cord, they will embrace the Eurasian Trade Zone. Evidence is the numerous heavy rail facilities that begin in Russia and end in Germany for commodity supply. There are two Germanys, one with old corrupt ties to the West, another with traditional reliable ties to the East. The Western camp is given light by the press, while the Eastern camp works behind closed doors shaping the next chapter.

  • The Eastern Alliance (often discussed in past Hat Trick Letters) is slowly coming into view. The Russian and Chinese corridor will serve as the commercial foundation. The BRICS Development Fund will serve as the backbone. When Germany joins in more overt manner, the Alliance will be clear on the geopolitical stage. Then comes the Saudis to join, complete with protectorate role already offered by the Eastern Duo giants, who together will announce the end to the Petro-Dollar defacto standard.

  • The political rebellion movement inside Germany is slowly coming into view. They wish to return to the D-Mark currency and to discard the Euro, an experiment in disaster, waste, fraud, and ruin. The movement is gaining traction. Discussion of the Nordic Euro (aka Teutonic Euro) has been heard on an increasing basis among its tribal cousins. Germany will side with Russia & China, and join the next chapter, after shedding its PIIGS pen trash.

  • Both Russia and China purchase all their domestic gold mining output. If truth be told, their gold reserves are multiples higher than the official data indicates. Neither nation has any desire to cooperate with such critical disclosure, much like national trade secrets. Both nations are ready for the next chapter, with a few years of preparation in new modern systems, platforms, wiring, and gold held in reserve as core wealth.

  • The ABN Amro news of halted gold delivery speaks volumes to the absent inventory linked to the corrupted London gold market. They have no Gold in inventory. They control the Gold price with paper leverage and suppressive techniques. This news halt out of the Netherlands should be viewed in context of the Germans, Dutch, and Austrians demanding their gold in repatriation. London has none. What gold bullion they do obtain comes from urgent shipments from the Roman Catacombs and the Basel hills of Switzerland.

  • The nations across the entire West have citizens deeply worried about their savings wealth stored in the banks. They are beginning to realize their accounts are legally considered as bank liabilities subject to heavy loss upon bank failures. They will begin to remove the money from bank accounts in droves, but with capital controls imposed.

  • The Cyprus bank account tax is the latest ignored shock wave warning to the West. It is described as a small tax to assure bank solvency, but it is a vicious transfer from sovereign source to depositor private source in funded bailouts. It is confiscation. The 2005 Bankruptcy Law in the US gave away the plan, with savings deposits subordinated under derivatives. The MF-Global episode has not resulted in much learned. It was the first test ride of the subordination rules in the new law. The Jackass warned in early 2012 of an MF-Global event for bank accounts and stock accounts. The event is coming very soon, but the public is very sleepy distracted and dulled.

Source: Silver Doctors

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Jim Willie: The Collapse Is At Our Doorstep

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Jim Willie is not one for holding back and in his latest interview with Silverdoctors sums up where the global financial system currently stands. With each passing week the situation worsens. Willie see a global financial collapse now close at hand and the endgame will be triggered by a small-medium sized bank failure in Europe.

The European collapse will ignite a global Gold rush as the only remaining safe haven ultimately ending  USdollar as worlds reserve currency.

  The Doc began by asking the Golden Jackass what will most likely be the trigger event for a complete systemic collapse:

 I don’t think we’re going to see a default as a trigger event in gold or silver. I didn’t say we won’t see a gold and silver default, I said that it won’t be the trigger. There are just too many deep sources for gold that the central banks have access to. I refer to Basel Switzerland, the Roman catacombs, and the BOE, I think they’re pretty close to the bottom of their gold barrel, but they have big powerful friends in Rome and Basel Switzerland.

The trigger is not even going to come from within the US, because it’s just so controlled- the markets are being controlled from multiple different centers, in particular the Federal Reserve and the Treasury Dept, JPM, Goldman Sachs.

It’s just so corrupt to the core, and we’re seeing a blossoming of the fascist business model and the corruption that’s accepted.

Attention should be drawn to Europe. Look at some of the most recent events that are really quite staggering.

The Italian elections kicked out the GSax preppy Mario Monti. I’m surprised that he’s not being thrown off a palace balcony. It’s directly in response to hikes that Monti imposed on property tax to finance the bankers! The Italian people have a much more effective political system than the US!

Italy actually has elected a comedian! This is like electing John Belushi to form a coalition government! Mario Monti is on the way out. What does that mean?

The defense of their dead banks with liquidity lines and property tax hikes will end in the near future!

In Spain you have new high level financial corruption events that have paralyzed the nation at a time when they’ve already seen a string of big financial firm failures!

This at a time where they have 25% unemployment. I think that the likelihood of violence on the streets is greater in Spain than in any other country.

Spain’s bank insolvency and wretched unemployment is causing tremendous distress, and there will be a breaking point there.

Then in France you have Hollande, the leader of the socialist clowns has raised the highest tax brackets to 90%. The resulting capital flight to Scandinavia is astounding, leaving the nation extremely vulnerable.

Then you have the German economic slowdown which is really capturing some attention, which will remove ability and patience of bank rescues.

Then you have the London banks which are joined by French banks in broad deep exposure to Southern Europe. They’ve set themselves up to have their heads cut off.

Recall that the Draghi solutions like LTRO were recently insulted by debt downgrades, which was unprecedented.

Then you have the USFed, which is the only buyer of USTBonds, and the Euro Central Bank as the only buyer of PIIGS Govt Bonds.

Here is a note as to the stress in the system: the European banking system received $1.2 trillion in Dollar Swap funds from the NY Fed in January alone to prop up the ECB banking system.

European banks are collectively much larger than the US banks, but are in suspended animation while the US banks are being supported by narcotics money laundering.

A big European bust is coming. When the European bust events occur, the mad scramble for safety will be on, and they’re not going to be looking for Switzerland any longer because of their Euro peg. A massive rise in the European gold price is coming and it will be staggering, shocking and not reversible. It will ignite a global Gold rush, a massive short covering rally, and powerful 30% to 50% rise in the gold price will come in response to the European collapse.

Following that will come the arrival of the Gold Trade Finance platforms. Gold settlement for trade across the world- primarily though coming out of the East.

In other words, trade involving two parties not involving the US, one of them being an Eastern nation, and they will settle not in dollars anymore, they will settle in gold, and they will have some help from their friends in Turkey.

We’re going to see an end to the USDollar reserve status following these events, and the funeral will have a speech given by the Saudis to bring an end to the Petro-Dollar itself.

You have to look to Europe and not to the US, the US is a joke in regards to crisis, management, propaganda, the ESF, narcotics money laundering, sponsored fraud, it’s just unbelievable what’s going on in the US, it’s not going to be the trigger, the trigger will be Europe.

We have 15 to 20 potential sites to force the breakdown. It’s not just one or two. Every couple months there are a few more potential areas to cause the breakdown. That’s very, very dangerous, and new. We didn’t see that 3-5 years ago. Back in 07 it was really just sub-prime. We have about 12 different areas now which are just as dangerous as sub-prime, and both of them are in Europe.

 

With QE4 and the recent return of NINJA loans as the Fed attempts to re-inflate the housing bubble, The Doc asked Willie whether the Fed would be able to kick the can down the road one more time with one last bubble:

They have 15-20 fingers and toes, but there are just too many different areas that they need to plug.
This real estate bubble is a joke.  There’s no new bubble coming or even on the horizon.  What we’ve got is the US government has sponsored a whole new round of sub-prime mortgages.  Expect instead of the big banks underwriting them, it’s the Federal government.  We have not seen a rebound in demand for housing, even though the 30 year mortgage rate is under 4% and has been for quite a few months.

What’s not shown in the press is that there’s still 10 million homes that are sitting on the bank balance sheets.  They’re called REO’s, and they’re selling their REO’s or short sales, which ARE NOT INCLUDED IN THE CASE SHILLER INDEX! 

It’s a parallel of the discouraged workers no longer included in unemployment!  They’re bringing labor market calculations to the housing market.  They’re not going to revive the housing bubble for a simple reason- there’s not widespread finance available, it’s exclusively coming out of the FHA.  The other reason is that people have a great distrust for buying homes after they saw so many people foreclosed on.  Another reason is that the people don’t have brisk income.
The factors are not there, it’s kind of a lunatic claim to state that the housing market is going to be re-bubbalized.  Not even close, it’s stuck in a depression!

 

 

The Doc asked Jim whether we face a lost two decades like the Japanese, or what type of collapse we face in the US:

 

I said this back when Lehman Brothers fell in the autumn of 2008.  The US is on a path that cannot escape systemic failure and total dependence on the printing press to cover its debt and for a debt default of the US government debt, which will come in the form of a global conference to organize and co-ordinate the debt write down.  There will be US military outside the room to make sure everyone complies.

If the US goes ahead with sequester cuts, they’re talking about $4 trillion over 10 years.  I cannot emphasize how small that is.  But let’s go through some of the points why I believe the collapse is at our doorstep:

The collapse is happening now- it’s no longer ultra-slow motion like 2 years ago.   It’s a new event every few days or weeks.  The pace is quickening.   

The extreme nature of current events is alarming.  Just in the last few months:

The US Fed announces every month their extension of 0% forever (denigrating their own exit Strategy talk).

 $1.2 trillion was doled out by the USFed to European banks in January alone!

We have the Germans demanding repatriation of their official gold account (Allocated Accounts).

We have the Italians electing a comedian like John Belushi to halt the property tax hikes that bail out banks.  This is an insult to their entire political system which experienced that Mario Monti appointment without an election.

We have the London banks recently sponsoring a Chinese Yuan Swap Facility, cow-towing to Asia.  This is unprecedented!  New York will not do such a thing, but London did, which means that London and NY might be at odds!

We have an attack announced on Mali in North Africa to wrest gold & uranium timed when the  Germans asked for repayment of their gold reserves.  The quantities really fit.  There was a suspicious comment by the French and British saying it will be repaid in 7 years.  300 tons over 7 years is approximately what Mali produces in gold that will cover almost exactly the German repayment.  That was organized by France and the US. 

We have the shutdown of the gigantic Mongolian copper & gold mine by Rio Tinto which is an example of resource nationalism. 

We have raids larger and bolder of the GLD inventory that prevents a COMEX default and will produce a bigger price discount vs. the spot for GLD shares.  I think it will go down towards a 20% discount, which will cause alot of problems. 

We have the USFed preparing for QE5 (or rather QE187, as in QE to Infinity). 

We have events like the major central banks losing credibility while engaging in open currency war.  The franchise system of central banks is being questioned.  They’re in battle with each other. 

We have the US facing a fiscal cliff, which forces a quantum leap in job cuts (recession alert).

We have the Japanese ratcheting up the competitive currency devaluations (only USTBond buyer).

We have the Swiss managing their Euro-Franc peg, but suffering losses in Japanese & British bonds.

We have the Russians hosting a G-20 Meeting to coordinate the alternative to US$-based trade.
THEY ARE NOT GOING TO CONTINUE WITH DOLLAR BASED TRADE SETTLEMENTS!  NOT GOING TO HAPPEN!!

We have the emergence of Turkey and soon India as gold trade finance intermediaries.  They’re going to supply 1 of 2 parties engaged in trade with gold so they can make the settlement of the trade. 

We have the Iranian sanctions coming to a conclusion in US acquiescence.  The US is surrendering to the Iranians! 
All these events have occurred just since the new year began less than two months ago!  The pace of extreme events is quickening!

Extreme events have become the norm, putting tremendous additional stress on the system which the boys are trying to manage.  They don’t have enough people, enough resources, enough channels, and they don’t have enough brains to do it.

The managed system cannot succeed, it’s too complex.  They are attempting to work towards a system of total system management, and it’s just not going to work.

A series of climax events is coming very soon.  The changes will be rapid and breath-taking. 

Vast wealth has been moving East the past 3-4 years, and with it great power. 
Look for some seemingly minor bank failure to cause a ripple effect of deeper damage. 
It’s going to involve larger banks tied with commitments such as counter-party contracts or intermediary supply functions, and things are just going to start wrecking. 

I think vast wealth is going to be lost in the US and the West, except by gold and silver owners. 
Owning gold and silver will become harder to do because the rules are becoming stricter.
Those who have set themselves up in the last few years are going to be the big, big winners, and the ones who are bold enough and brave enough to do it now are going to be glad for their actions. 

I have a family member who refused my advice three years ago, and now that family member is facing the conversion of her very large privately managed IRA pension fund into these new special Treasury bonds.  That’s going to cause a real firestorm by the public, and they’re going to wish that they had converted their IRA’s into a gold account.

Source: SilverDoctors

Financial Collapse 2013

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Many economists and analysts have been warning of a Global Financial collapse is just up ahead. As 2012 draws to a close a number of those well known names have risked their reputations and predicted what lies ahead in 2013. I have pieced together some of those predictions.

[1]Jim Willie writes of a Gold Standard as a solution to the crisis nations find themselves in as the system collapses. 

The arrival of the Gold Standard as the solution is being slowly manifested in the form of a gold-core trade settlement system, which will drive a global Gold Standard. The new system will dictate bank reserves practices, and render the USTBond as a rejected toxic paper relic. It should arrive early in 2013. In the process, the Western nations will become impoverished, as they desperately cling to the failed system. Anger will rise. Disorder will prevail. The USDollars inside the United States will be trapped, then devalued as the public watches in shock. The power will shift East inevitably, with the shipment of Gold. A new era will begin.

BusinessInsider wrote of [2]Geralde Celente’s (23 Dec 2012) view ahead.

Gerald Celente, the popular trends forecaster of Trends Research, cites the work of a former Treasury official and warns that the bonds are in a massive bubble that will burst in 2013 in what will be a financial collapse like nothing we’ve seen before.

He recently spoke about it in an interview with King World News:

“This piece is being penned by Dr. Paul Craig Roberts, the former Assistant Treasury Secretary under Ronald Reagan.  And he is convinced that the bond bubble is about to burst.  This cannot continue to go on the way it is.  Everyone knows that the whole game is rigged, and so is this….

The whole game is rigged.  It’s ready to go down, and Dr. Paul Craig Roberts believes it’s ‘Bonds Away’ in 2013 as the bond bubble explodes and brings about a financial disaster even worse than the Great Depression.

Because the whole world is being propped up by these phony bonds and it’s going to collapse.  It has to happen.  Interest rates are going to start going up, and when they do the bond bubble explodes.  You cannot keep interest rates at zero for this amount of time and expect anything other than disaster to follow.”

[3]Jim Rogers expects based on the US having a recession every 4 years and the existing debt is so high that 2013 is going to be a disaster and for everybody to be very worried. For interview on MoneyNews click here.

be very worried about 2013 be very worried about 2014, because that’s when the next slowdown comes. In 2002 we had a recession in 2008, it was worse because the debt was so much higher, it is going to be even worse because the debt is so staggeringly high now. So if you are not worried about 2013, please get worried

Max Keiser on an interview (Aug 2012) on the Alex Jones show gave a timeframe of April 2013 at the latest.

April 2013 at the very latest when those tax receipts in the US will be spectacularly short.

. Goto 32 min

[4] Marc Faber sees 100% chance of Global Recession.

Dr. Marc Faber the Swiss fund manager and Gloom Boom & Doom editor is still expecting a global recession in 2013 when the economies of the world could take a hit from negative developments.

Speaking to CNBC‘s Closing Bell on Thursday, Faber still sees a 100% chance the world heads into recession, echoing a call he made in May, as he simply can’t see where growth will come from.

“If you look at the world, essentially Europe, the US, China and emerging economies that depend heavily on China, Europe is already in recession, the German economy is still growing slightly but likely to go into recession, the other economies are already in recession. The US has decelerated and I don’t see much growth in the next 6-12 months,” he said.

…….

When taken in concert, all the economies of the world could take a hit from these negative developments, he reckons. “I think we could have a global recession either in Q4 or early 2013.” When asked what were the odds, Faber replied, “100%.”

Is there anything the Fed or the Treasury can do, i.e. more quantitative easing?

“If you look at the injections of liquidity and the interventions by the Fed and also by the Treasury with fiscal measures over the last 15 years, [the measures] have actually already impoverished the U.S. economy,” he said.

John Williams (shadowstats.com) sees hyperinflation by 2013/2014

the economy is not going to recover. They are going to have to buy increasingly more and more as it does so the treasuries actually add to the increase of the money supply and that adds to the inflation pressures from there. where i see the risk and  where i see the trigger here from moving into a hyperinflationary circumstance in the next year or two. By 2014 is the outside timing I put on it. Very simply is a panic decline in the dollar.

See 12:40 min

[5]Peter Schiff has been bullish on gold and has been proved right down through the years. Schiff has also be very vocal in criticising the state of the US economy and has predicted a US Treasury collapse in 2013.

Market-Crushing Treasury Collapse To Hit Around 2013 , Peter Schiff expects the coming crisis to blow the 2008-9 financial crisis out of the water.“The more you delay it,(The FED’s ultra-loose monetary policy ) the bigger it will be,” “so we need to raise interest rates during the recession to confront the inefficiencies.” Peter Schiff told Forbes in a phone interview – via Forbes

[6]Michael Kreiger in an article on ZeroHedge (Oct 2012) believes 2013 is when the US finally experiences similar problems to the EU as the fiat dollar ponzi system comes to a boiling point.

As Nixon’s Treasury Secretary John Connelly said when confronted by a group of European Finance Ministers: “it’s our currency, but your problem.”  At the time he was correct, as we were at the very beginning of the fiat dollar standard.  41 years later the system is in its final days and our currency is about to become our problem as well.

There were always going to be massive consequences to keeping this ponzi alive.  What is extremely unfortunate is the small number of U.S. citizens that actually understand specifically that the root of every problem we face right now is the fiat dollar monetary system, because it gives all the power in the country to the Federal Reserve and the TBTF banks that tell Banana Ben Bernanke what to do.  Since 2008, many of the consequences of the fraud called American Crony Capitalism Inc. have been clear, but it has yet to hit the boiling point.  I believe that the boiling point will be hit sometime within the next six months, and 2013 will see the streets of America  beginning to look a lot like the streets of Spain and Greece.

Nobody sums it up better than this interview of Nicole Foss (Automatic Earth) on interest.co.nz of what lies ahead.

Potential Collapse scenario 1

Potential Collapse scenario 2 (Jim Rickards)


Sources:

[1] SilverDoctors,

[2] BusinessInsider,

[3] Jim Rogers,

[4] Lewrockwell,

[5] peterschiffchannel.blogspot.ie,

[6] ZeroHedge

Jim Willie: US Dollar End Game Explained

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Excellent article from Jim Willie’s explanation of the US Dollar’s demise and where the global financial economy is moving toward. As the Fed, BOE, ECB, BOJ and SNB are busy printing its interesting to note that money velocity is slowing down. Its not finding its way into the economy. China is busy working behind the scenes undermining the petrodollar while cutting deals with nations to trade oil in non dollar currencies, in particular the yuan. Jim reckons that Arabs are ready to be backed by China and to a lesser extent Russia in a major move against the petrodollar. Other countries such as Canada and Mexico have already agreed to sell oil to China in return for investment and the US is powerless to stop what is happening.

Although the US has blockaded Iran from the SWIFT bank payment system, Iran has found ways around this and ultimately their will be a new independent system which will further enable trade outside dollars. Finally Jim believes that the USDollar will lead to the collapse of all major fiat currencies  and the prevailing currency is the one that will be used in global trade. All points towards Gold.

The recent decision by the US Federal Reserve to contaminate the financial body until it responds favorably was the last straw in my book. Witness a declaration of permanent QE and hyper monetary inflation of the most virulent strain, unsterilized. The USFed is essentially admitting failure. The signal serves as the loudest death knell for the USDollar among many in a sequence.  The QE bond monetization of USGovt debt has turned viral and entrenched. It is sold as stimulus, when in fact it acts like a giant wet blanket on the USEconomy. It is intended as stimulus to businesses, but the effect is felt on the financial speculation and on Asian direct business investment. In the past the emergency lever device had been successful only because it was used on a temporary basis. But now the USFed high priest assures it is a permanent fixture, a sign of their failure.

The money is not finding its way into the USEconomy for further circulation. The plague is insolvency, soaked by endless applications of tainted money from central bank fire hoses.

GOLD PRICE READY TO EXPLODE UPWARD

Gold market instability could be a tremor before a burst upward. The same appears true for the silver market. On a single day last week, JPMorgan dumped two years worth of US silver mine output in the form of paper silver supply on the COMEX market. The corruption went largely unnoticed. They defend the important $36 level.
A powerful USDollar decline is imminent.

The public is too ignorant to comprehend the ruin. They can only see the threat to their personal ruin.

The bankers are determined to ruin the entire system in order to retain power, all while dispensing increasingly nonsensical dogma like from heretical high priests about the effectiveness of their solutions. Theirs is heresy built upon alchemy laced with arrogance, with no precedent of success in past history. A definition of insanity comes to mind, offered by a psychologist who works in a clinical practice. Let’s stick with the layman translation. Insanity is defined as repeating the same action but expecting a different result. So the USFed conducted QE, then QE2, then Operation Twist (a deceptive QE), now is set for QE3. It expects a different result from the rising costs and debasement of the currencies. Somehow by enlisting the cooperation of the Euro Central Bank, the Bank of England, the Bank of Japan, and the Swiss National Bank, together they can pull off QE3 in a veritable ongoing QE to Infinity when all previous efforts have failed to produce a solution or economic recovery. The high priests from the central bank altars do admit that liquidity does not address the insolvency ills, yet they hit the monetary levers and accelerators more quickly. The central bankers are in a panic, and it is beginning to show clearly. Their solutions solve nothing. They will next attempt to rule more formally over the ruins.

MONEY VELOCITY

Money velocity is going down as quickly as money supply is going up. This report card is a grand contradiction of the USFed actions for a generation. The American Weimar experiment is turning into a tornado of financial ruin with inadequate recognition. As industry was dispatched and forfeited to Asia, the USEconomy lost its base for traction. New money has lost its effect in producing economic activity following a series of asset bubble busts, a spinning of capitalist gears, now stripped gears. New money is devoted to the financial sector in perverse fashion, as a reward for the past destruction of capital itself. The central bankers cannot dictate the speed at which money moves. They can only create it and drop it in the mix, speak their incantations, sprinkle pixie dust, offer some loony fiat prayer to the duped public, and continue with the next paper dump. The Untied States will gradually achieve systemic failure from redoubled efforts, suffer debt default from inability to manage the debt structure, and fall into the Third World. The nation will experience the monsters of high prices and acute shortage without comprehension of its source. It is toxic money.

The growth of the monetary base has been staggering high since the financial crisis broke in September 2008 with the collapse of Lehman Brothers. Since the end of August 2008, the monetary base has risen from $877 billion to $2,651 billion as of September 2012. That is a giant 3-fold rise. Witness the American Weimar era, its final chapter. The massive increase in new money has done nothing to foster growth in the USEconomy. The main reason is that fiat paper money destroys capital, a concept the hapless corrupted US economists cannot comprehend, either from compromise to their masters or lack of intellect due to years of exposure to the ass backwards preachings. The USEconomy is stuck in a powerful recession based in grotesque insolvency and bond fraud. As the USFed is poised to kick in another round of QE bond monetization, the money supply will ramp sharply up again. Do not expect much of any economic benefit, since the cost structure will rise again, then shrink profit margins. This capital destruction factor is a great blind spot to the hack economists who operate more as marketing harlots for Wall Street and the USGovt than analysts and advisors. The Ponzi Scheme theory dictates that an acceleration in new money is required to keep a constant speed. Expect more wreckage from the stripped gears of the USEconomic engine.

The money velocity chart shows a deadly decline since 1980, and a powerful decline since the 2007 outbreak of the absolute bond crisis. The new money is going to the big banks in bond redemption, derivative coverage, and Black Hole (Fannie Mae, AIG) fills under the USGovt supervision. The money is not finding its way into the USEconomy for further circulation. The plague is insolvency, soaked by endless applications of tainted money from central bank fire hoses. The velocity of money has been falling for years, in reflection of an economy that is not turning over much at all. Think of a car missing its cylinders, spinning its gears, burning itself out, going nowhere. The above chart serves as pictorial evidence that the root cause of ruined money was the war. In the current decade, the wars are endless. America chose war over industry. A fuller explanation is offered in the September Hat Trick Letter.

Three eras are worth identifying in my view. The Vietnam War era and its aftermath saw huge expansion in money supply, huge nominal income growth, and huge increases in price inflation. The USFed did not interrupt the expanded USGovt debt from reaching Main Street, simply put. For consecutive years, the Consumer Price Index rose over 10%, which led to big worker pay hikes. The result was that US corporations began to send industry overseas. It started with Intel going to the Pacific Rim. The money velocity fell, as income fell on a real basis. The climax event was China being given the Most Favored Nation status in 1999, which released the gates for foreign direct investment. China made a deal with the Wall Street devils that has yet to gain publicity. The hidden motive was for Wall Street firms to borrow the Chinese gold hoard from the Chairman Mao era, so as to continue the great gold suppression game that has bankrupted the Untied States and betrayed the nation. US and London bankers skimmed and stole the gold.

HOUSE OF SAUD STARTS TO UNRAVEL

More loyal Jackass wannabee followers will recall a story (repeated often) that on the Easter Sunday weekend of April 2010, a secret gathering of over 200 Arab billionaires convened in Abu Dhabi. They arrived in unmarked jets. My source was one of only two or three white faces in the crowd, invited by his clients. One result of the meeting was an accord struck between the Persian Gulf oil producers, led by the Saudis, to work toward a pact with Russia and China as protector of the gulf in return for financial cooperation, economic construction, and forward progress. The implicit message was that the Untied States would be phased out in the protectorate. In the balance would lie the Petro-Dollar defacto standard as victim. Events continue to this day in movement toward that end.

However, since the Syrian uprising, a new lethal element has entered the mix. Account will be kept brief, since so volatile and controversial. Just some bare notes. The Assad family in Syria has suffered some assassinations. Apparently, the Saudis had a hand in the killings. HezBollah has vowed retaliation. Their ties to Iran might be longstanding, but perhaps are exaggerated. My view is their home is in Lebanon. In August, Prince Bandar was assassinated. He was the Saudi head of security, and long-time ally to the USGovt. The Saudi regime is concealing his death, with outdated photos and false statements. They are working toward a transition. The House of Saud has been unstable from threats to the south in Yemen. It is unstable from internal threats tied to the fundamentalists. Although cooperation and respect has been shown between Riyadh and Tehran, the Bandar hit has created an entirely new environment. The Saudi regime with high likelihood is in its final months.

More importantly, the Petro-Dollar is losing its all important Saudi leg. Implications are vast. The US public takes the USDollar for granted, with almost no concept of FOREX exchange rates. If the House of Saud falls, when it falls, the impact crater will include the entire waistline of the USEconomy and its financial dog tail that wags it. The USGovt and its banker handlers have relied heavily upon the Petro-Dollar in general, and on the Saudis in particular, ever since Henry Kissinger signed an accord that governs over the grand surplus recycling back in the 1973-1974 era. Watch the Saudis convert USTBonds to Gold, then bug out of the desert to their new mansions in Southern Spain.

CHINA AS INTERMEDIARY AGAINST PETRO-DOLLAR

Reports swirl that China is attempting to act as intermediary in global oil transactions, for Yuan currency settlement. The rebellion globally is picking up momentum against the USDollar. The Petro-Dollar defacto standard is slowly unraveling. The denizens of the Untied States have no idea the ravaging impact of a lost global reserve currency. It will unleash price inflation when the USFed central bank is letting loose the monetary flood gates. This declaration is an act of financial war directed at the US by China. To fortify the rear flank, Russia has promised to meet all requests for crude oil made by China, with settlement in Yuan and Ruble currencies. Take the pledge as a protection from any sudden USGovt threat or retaliation. The Russia-China Axis is forming more clearly in opposition to the USDollar, the Syndicate behind it, the many Embassies that offer sanctuary for espionage, and the global rules that enforce its hegemony.

Crude oil payments are the critical core of global trade. The rest of global trade will follow in non-USDollar payments, all in time. Entire banking systems will gradually make a transition away from the USTreasury Bond in its reserves managements. The banking practices will follow the trade payment structures, as it should be. The profound effect on the USEconomy will be clear, as blame is shifted as usual to external factors, even to extremists. In reality the US is up against vengeful Cossacks and the angry Mongol Horde. The entire world is moving against the USDollar, seen increasingly as a toxic agent within their internal domestic systems. They see the lack of solutions, the spreading bank insolvency, the accelerated debasement of currency, and the corrupted grants of multi-$trillion banker grants. They are taking action in response. They are following the Chinese lead with the Russians acting as a quasi-Rasputin.

Gerald Celente reported in early September, “On September the 6th of 2012, China officially announced that any country in the world that wishes to sell crude oil using its currency the Renminbi instead of the USDollar can do so. The following day September the 7th, Russia announced that the nation will sell China all the crude oil they need, no limitations whatsoever. They will not use the USDollar for their trade.” The claim by Celente is far reaching. The USDollar is dying a slow death. Its antagonists do not wish to speed the death process too rapidly, for fear of quickening the ravage to their own nations. They also do not wish to invoke the wrath of the USGovt, which since 2003 has enforced the USDollar as global reserve currency via its war machinery.

What China is offering is an intermediary clearing house role to sidestep the Petro-Dollar, where crude oil payments can be made in the Chinese Yuan currency. This offer is a financial act of war against the Untied States currency, where China will backstop all transactions. It is a violent offer to disrupt the USDollar. Look to see if any Saudi oil sales are settled in Yuan currency as alternative, even the Euro currency as expedient. The superpowers are openly attempting to isolate the USDollar, the clear victim to be the USEconomy, the land of consumption excess. The move is a tacit push of the US into an isolated place where it can very easily slide into the Third World.

MEXICO CUTS A DEAL WITH CHINA FOR OIL

Mexico is in the process to make concrete a major deal to sell crude oil to China, but not in USDollar terms. The Chinese declaration of financial war against the Untied States has reached both the northern border in Canada and the southern border in Mexico. To be sure, the Canadian oil is not sold outside the USDollar. But other factors are hard at work. The bulk of Athabasca oil produced from the oil sands in Western Canada (Alberta) output is directed to China, by way of the Vancouver ports owned 100% by China. In fact, the Chinese influence is so strong in the beautiful city on the Pacific coast that it has earned the nickname of Hongkouver. Some shallow analysts attribute a wayward motive to the decision by the USGovt to abandon the Keystone Oil Pipeline several months ago. The more realistic hidden motive was to assure the Western Canada oil output would be sent to China. The cutoff to the pipeline came with spurious official accounts, all quite humorous to the informed. The pipeline was abandoned to accommodate China, owner of significant USTBond holdings. They are the largest USGovt creditor. The tipping point was passed many years ago when the majority of USGovt debt was held by foreign creditors. Its consequence is vivid and unmistakable. The Untied States is converted into a colony, a killing field, as pathways are fashioned for entry into the Third World.

China through closed door negotiations is sealing deals to purchase Mexican crude oil without using USDollars as its trading currency. The Yuan is slowly moving toward global reserve status, not by a summit meeting and signed accord, but rather by numerous bilateral deals. Consider the bilateral swap accords signed by China with partners in Brazil, Japan, and elsewhere. The list grows, and beyond oil trade. As it does, the net is cast over the USDollar in isolation. Officials claim meetings were held with the Mexican Govt and PEMEX, the state owned oil giant. They are in progress with a brokered secret deal to purchase crude oil using currency means other than the USDollar. Expect a public announcement soon by Chinese Govt and PEMEX firms. In the past decade, China has planted seeds in trade while ignoring politics with numerous major players in global trade. The USGovt prefers the heavy handed financial banking games, backed by the heavy handed military maneuvers, all part of the sickening Full Spectrum Dominance that has blossomed in ruin. The Chinese have responded with an archipelago of trade pacts, best viewed as a Full Spectrum Encirclement of the USDollar. It cannot be conquered. So their plan apparently is to isolate it, to starve it, to let it suffer the Weimar consequences of its own high pitched debasement, and to permit it to become a Third World currency by default.

Over the past ten years with new trade agreements China has invested $billions inside Mexico. China has helped the Mexican Govt create jobs and has financially supported investments in the privatization of ports and infrastructure throughout Mexico. As the movement toward privatization of large sectors of its economy continues, China is in line to benefit from additional investments inside Mexico. Since the 2009 global economic crisis, Mexico’s central bank has been quietly purchasing large quantities of gold. In fact, some of the recent boost in May for Mexico Central Bank gold holdings was gold purchased from Chinese sources. The gold sales belie a closer relationship building with Mexico on the southern US border. While the USGovt is occupied with the Mexican Govt on matters pertaining to gun running, to handling illegal immigrants, and to shielding vast narcotics sales, the Chinese are busily working on trade, with a gold foundation and crude oil blood system. Those are the stuff of a stable currency. Perhaps Mexican leaders are preparing for the imminent and unavoidable devaluation of the USDollar. In more practical terms, regard the movement as the collapse of the USDollar in a vast sea of liquidity, better identified as toxic fiat paper currency.

STRIKES HINDER GOLD OUTPUT

Not in sufficient focus is the radical impact on gold supply. The gold investment demand has been on a tear in recent months. A sinister effect has been realized from the vast QE bond monetization conducted by the USFed and its partners at the Euro Central Bank and the Bank of Japan. The effect is of rising food and energy costs. The impact is particularly hard felt in poorer areas of the world. The great majority of major gold and silver mines are located in the poorer nations. The labor strikes at mining facilities are as much based upon unsafe worker conditions as they are based upon a higher cost of living, centered on food costs. The workers need more to survive at home, as they provide more precious metal output that satisfies mining company production targets. The end result is lower output in pockets of South America such as Bolivia, but more importantly in South Africa. A whopping 39% of South African Gold production has been taken offline. The impact on global output will be seen in the next few quarters. The fast rising investment Gold demand will be met by a significant decline in Gold supply. Price pressures will force a much higher Gold price. But first comes the depletion of the COMEX, as its paper contract merchants continue to ply their trade. Their new specialty is stealing client accounts that stand ready for contract delivery. See MFGlobal and the JPMorgan thefts, all fully blessed by the tainted US Court system.

THIRD WORLD THREAT

The implications are vast. A lost Petro-Dollar standard would mean a grand shift in payment for oil transactions, the most important of all global trade. In the last 20 years, all has been turned upside down. A global phenomenon of a powerful nature has been at work since the Lehman Brother failure, the Fannie Mae adoption, and the AIG redemption in 2008. The entire world is losing trust in the USGovt and its financial institutions. Personal email exchanges cite a regular occurrence of US corporations not receiving return phone calls, and of open disrespect in Europe for American businesses. The debt rating agencies do their part in upholding the paper fortress walls, but they must over time deliver the downgrades. An important catalyst took place when the USGovt imposed trade sanctions against Iran. The result was angering US trade partners more than anything else, well, except for causing severe price inflation on the Iranian Economy. The movement in reaction has been swift by global trade partners, in establishing bypass routes for payment systems between nations. The workarounds against the SWIFT bank payment system have been remarkable. The climax will be the non-US$ payment system to emerge, with no centralization, complete independence, relying upon non-bank devices like mobile communications.

Another bypass event just hit the news wires. The Swiss-based Vitol is the latest oil firm bypassing the USGovt sanctions against Iran. They exploit a legal loophole in Swiss law, since the nation did not abide by the US-led sanctions, a notable resistance. Vitol boasts being the largest oil trader in the world. It buys and sells Iranian fuel oil, undermining Western efforts to choke the flow of flow of money to Tehran. In August alone, Vitol purchased two million barrels of fuel oil, used for power generation, from Iran and offered it to Chinese traders. The Vitol firm is not obliged to comply with a ban imposed in July by the European Union on trading oil. The tale of the cargo for Iranian fuel oil involves tanker tracking systems being switched off, frequent ship-to-ship transfers, and the blending of the oil with fuel from another source to alter the physical specification of the cargo. How crafty.

Global finical markets are acutely aware that oil trade outside the USDollar will rapidly destabilize the USDollar even further. With Russia and China having entered into an agreement to trade crude oil using their own currencies, the Mexican news of a Chinese oil deal has potentially devastating consequences. The eventual effect is that the USDollar will lose its prestigious reserve currency status. In the process, it will lose value gradually. My view is that the defense of the USDollar will lead to all major fiat paper currencies to implode, step by step, taking down the banking systems and economies of major nations. The prevailing currency will be what is used in global trade. All signposts point to Gold. A new global trade system is ready to be installed, based upon gold in special notes. The transition awaits further collapse of the current currency regimes, the further collapse of the sovereign bonds, and the further collapse of the banking systems, which all assures the collapse of the global economy.

The QE fallout by the desperate central bankers has been seen in fast rising demand for gold bars and gold coins. The phenomenon is primarily in the Eastern world but also in Europe. The American crowds remain transfixed on their dwindling paper assets locked in stock accounts, many not easily altered due to tax rules. They remain transfixed on home equity losses, in a mindnumbing effect that the Jackass described in years 2005 and 2006 and 2007. The American Home was not a hard asset at all. Since its value was largely determined by the mortgage loans and mortgage bonds, together with the vast network of devices like MERS among bankers and the hidden caches with slush funds at Fannie Mae. The entire criminal history of Fannie Mae has been safely buried under the USGovt roof. Ten years ago, people would laugh at comments that the largest and most powerful criminal syndicate was operating under the USGovt label. They do not laugh anymore, including my own family. They protect themselves with the real deal currency for storing life savings, GOLD. They will soon enjoy the benefits, safety, and efficiency of trade systems based upon GOLD also.

GOLD PRICE READY TO EXPLODE UPWARD

Gold market instability could be a tremor before a burst upward. The same appears true for the silver market. On a single day last week, JPMorgan dumped two years worth of US silver mine output in the form of paper silver supply on the COMEX market. The corruption went largely unnoticed. They defend the important $36 level. Volatility has returned to the Gold price. The current pause could be interrupted very quickly with a strong upward leg in both precious metals. The announced QE3 bond monetization program cannot be sterilized any longer. A powerful USDollar decline is imminent. As the USDollar reserve status is threatened, the gold price will zoom upward. Notice the occasional propaganda and basic lies regarding sterilization of new bond purchases. The USFed is fast running out of short-term USTBills to fund long-term USTBonds in the Quantitative Easing shell game that is more reminiscent of the Weimar Republic.

Fortunately for the USFed paper mache artisans, the American public is a lousy student of history and especially the concept of money, even the nature of economics and capitalism. The dumbing down of the public has reached a critical mass, but hope lies in the Gold sanctuary if people have any savings left after the busted bubbles and the parade of banners to join. They joined asset bubble parades instead of lines to enter factories. Across the world, an army of Gold soldiers is awakening after a 16-month slumber. They react to the stark awareness that QE not only ruins money, but its purpose is to redeem the toxic bonds owned by banks. The QE programs are not intended to bolster, stimulate, or fortify the economy. In fact, they render the USEconomy incredibly deep harm by raising the cost structure, reducing profit margins, wrecking business segments, and killing jobs. But the hard sell sure is fun to watch, as the central bankers squirm. The Jackson Hole conference was a gathering of buffoons without the clown suits. The public must seek refuge in Gold & Silver or face personal ruin.

The USFed mandate on inflation moves next to an absurd mandate on jobs. They will fail on both. Inflation will be permitted by the USFed central bank in order to produce jobs, in the most heretic and misguided folly ever seen in modern times. The 0% rate will stick until economic growth arrives, but it will never arrive, due to the damaging effect from the 0% rate itself. The dog’s tail is eating the entire dog in a perverse reverse effect of modern alchemy. The USFed ignores all Weimar chapters, after having rewritten the Great Depression chapter. The nation emerged from the depression only due to the Gold Standard and ample industry. The nation has neither today, and will therefore plunge into a systemic failure. The Third World awaits. Watch for the pressure points of tens of thousands of gasoline stations and food supermarkets, certain to erupt as the frustration and disorder spread.

The response in the Gold price has smelled a QE3 in bond monetization since the summer months. The difference is that this time, unlike the deceptive Operation Twist, the bond purchases will be unsterilized with new money injected into the system. That is a Golden supercharge to recognizable inflation. A major intermediate reversal is underway, with a 1570 base, a 1780 top, which indicates a 1990 Gold price target. The kicker in the market is the broad mining industry strike, which extends from South Africa to South America. Gold supply will be inhibited. Expect some regrouping with a pause at the 1720-1770 area, as a critical consolidation takes place before a breakout that captures the world’s attention. The right side handle is being formed, carved out. During this time, the doubters are tossed off the train. The new believers join. A recycle process is underway, as the monetary dumb are unloaded and new intelligent soldiers join the ranks. The renewal will permit a run over $2000. Once over 1800 price level, the 1900 resistance will be overrun like a paper fortress by angry mobs bearing torches and sticks. But in the meantime, a big battle is being waged at the right side handle, a consolidation before breakout.

 

Source: SilverDoctors

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