US MARKETS
We are trying to figure out the best way to describe the banking and oil sanctions
against Iran, which are blatant acts of war. Just look back in history at similar situations
and you will see what we are referring too. It is simple incompetence or is the allied plan
a false flag feint in order to distract attention away from debt problems?
A month ago when the US was trying to terrorize Syria and Iran with oil and
banking sanctions we said they did not have a chance of winning. Iran’s nations that are
friendlies, such as China, India and Russia are major nations that will assist in the
circumvention of some 70% of those sanctions. As we predicted all the excitement in the
Straight of Hormuz was just that, another distraction. This week the USS Abraham 2
Lincoln, an aircraft Carrier, went through the Straight, which tells us as we said earlier, it
was all just a game. That relieved pressure of financial markets in Europe, the UK and
US.
Most people forget an agreement has been in place for more than a year
between Russia and China, so the precedent has been set and it works. To simplify
things India wants to use gold in exchange for oil, a very simple and novel idea.
What does all this add up too? The basic common denominator is a growing
existence of the US dollar and of the world financial system. What Washington has done
has expedited the end of the US dollar as the world’s reserve currency. Worse yet for
the dollar deals like this are in the works all over Asia. Alliances are forming as we speak
and it is only a matter of time before it happens. We believe this will take place over the
next two years, accompanied by higher interest rates. These countries are proceeding at
their own pace and will soon have major agreements in place.
The movement toward an alternative trade, a monetary and financial system is
underway and the US is trying to force dollar usage on everyone, like it or not. If the US
doesn’t come up with an alternative soon they may be ejected out of world trade,
because few will want their currency. These engineered events just make the US look
weaker in the long run. Foreigners are already euro sellers and T-bill buyers.
Again, we return to the unnatural and unbalanced trade situation between
Germany and the remainder of the EU. The gap in competitiveness between the
industrial north and the south is enormous.
If the EU and euro zone had been properly set up as a political and fiscal union
that might have succeeded. There was no political union – only a financial and trade
union, which we wrote in 1992, could never work and it did not work as we are
observing. What this has turned out to be and we predicted it, and that is an unending
transfer of wealth from the north to the south. If you look at the pluses and minuses
Germany should exit the euro zone. The euro has been used to stay close to France due
to the experiences of the past. That is very difficult because the German culture is much
different than that of other countries like France, England or the US. You have to live
there in those countries and speak their languages to truly understand how they think
and why they are the culture that they are.
In addition to culture problems we have a group of Illuminists, who always
happen to be appointed to the positions of power to further the aims and goals of world
government. Today Mr. Draghi at the ECB is a prime example. All that was
accomplished by previous ECB management has been cast to the 4-winds – a complete
turnaround by following orders from London and NYC to crank up money and credit
creation. This obviously is the only way these elitists know how to temporarily make an
economy run. All they have done has saved the financial sector and done little for
economic recovery. Why should anyone expect any different result?
Italy is buried in debt, as is Spain and they are uncompetitive. Spain’s real estate
collapse is worse then that of the US. In Spain you also have to too big to fail syndrome,
which means bank nationalization in both countries, as in England and in other various
European countries. Spain has to go bankrupt. Real estate has not as yet hit a bottom.
Spain and Italy are already caught up in a deflationary debt spiral and will eventually
have to default and leave the euro. There was no vigilance. Few paid attention to their
performance and plight, and now you are seeing the result of that.
We are now faced with tremendous deficit spending, that money and credit being
supplied by the Fed, which, of course, will never be repaid.
While euro squabbles over the euro and sovereign debt the US is finding out that
he who has the gold makes the rules. Rumors abound that India may pay for part or all 3
of its oil purchases from Iran with gold. If this does become reality it will end up being
negative for the dollar.
Iran is to be punished because they supposedly want to make nuclear weapons.
These sanctions are on oil and its sale to others and being shut out of the world banking
system. From our viewpoint these sanctions have already been a failure. These moves
by the US, UK and Europe have only served to put more downward pressure on the US
dollar. The petrodollars have been on their way for sometime but actions such as these
two embargos will prove to be even more disastrous for the dollar. It shows the use of
dollars can be circumvented. That also means those countries that had been buying US
Treasuries may start to reduce buying and other currencies and perhaps gold will be
used as alternatives. That has been happening over the past few months. Obviously,
America’s problems are having a cumulative effect and those dollar sales are moving to
other currencies and are a reflection of a staggering world super power. America no
longer deserves its dollar reserve privileges - it has squandered them away. We see,
zero interest rates for three years, QE 3 on the way and the Fed lending $1 trillion, or is
it a fractionalized $10 trillion. The situation is not getting better, but getting worse and
that means we have a solid three years or more of climbing gold and silver prices.
The number of Americans signing contracts to buy previously owned
homes fell in December from a 19-month high.
The index of pending home sales decreased 3.5 percent, more than projected, after a
7.3 percent gain the prior month, figures from the National Association of Realtors
showed today in Washington. Economists forecast a 1 percent drop, according to the
median estimate in a Bloomberg News survey.
Applications for home mortgages retreated last week, giving back some of the
previous week's surge as interest rates rose, an industry group said on Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of
mortgage application activity, which includes both refinancing and home purchase
demand, fell 5 percent in the week ended Jan 20.
The index had soared more than 20 percent the previous week.
The MBA's seasonally adjusted index of refinancing applications slipped 5.2 percent,
while the gauge of loan requests for home purchases was off 5.4 percent. The refinance
share of total mortgage activity decreased to 81.3 percent of applications from 82.2
percent.
Fixed 30-year mortgage rates averaged 4.11 percent, up 5 basis points from 4.06
percent.
The survey covers over 75 percent of U.S. retail residential mortgage
applications, according to MBA.
Orders for U.S. durable goods rose more than forecast in December, led by
demand for aircraft, autos and business equipment that signals further manufacturing
gains.
Bookings for goods meant to last at least three years climbed 3 percent after a
revised 4.3 percent gain the prior month that was more than previously estimated, data
from the Commerce Department showed today. Economists projected a 2 percent
increase, according to the median forecast in a Bloomberg News survey. Demand
picked up for machinery, metals and communications equipment. 4
Confidence among U.S. consumers rose more than forecast in January to
the highest level in almost a year, on signs of improvement in the job market.
The Thomson Reuters/University of Michigan final index of consumer sentiment climbed
to 75 from 69.9 at the end of December. The median estimate in a Bloomberg News
survey called for 74, which matched the preliminary reading. The gauge averaged 89 in
the five years leading up to the 18-month recession that ended in June 2009.
Restrained spending by consumers held growth in the U.S. economy to a
2.8% annual pace in the fourth quarter, slower than economists forecast while still the
fastest pace in more than a year.
Gross domestic product, the value of all goods and services produced, climbed
at a 2.8 percent annual pace following a 1.8 percent gain in the prior quarter, Commerce
Department figures showed today in Washington. The median forecast of 79 economists
surveyed by Bloomberg News called for a 3 percent increase. Growth excluding a jump
in inventories was 0.8 percent.
SHORT NOTES
Consumer confidence in the U.S. steadied last week as fewer firings helped
ease concern about higher gasoline prices.
The Bloomberg Consumer Comfort (COMFCOMF) Index was minus 46.4 in the
period ended Jan. 22 after minus 47.4 the prior week. Confidence among independent
voters, which may be a swing group in the 2012 election, rose to its best level since
April.
Claims for U.S. jobless benefits rose last week, displaying the usual
volatility around holidays that has masked an improvement in the labor market.
Applications (INJCJC) for unemployment insurance payments climbed by 21,000
to 377,000 in the week ended Jan. 21, up from an almost four-year low in the prior
period, Labor Department figures showed today in Washington. The median forecast of
47 economists in a Bloomberg News survey projected 370,000.
The Virginia Retirement System and the Canadian province of Alberta will
lead a class action, or group lawsuit, against Jon Corzine, a judge said.
They are typical of the class of investors who lost money on MF Global Holdings
Ltd. investments, and their combined losses of $19 million give them a larger stake in
the lawsuit than other applicants, the judge said. The judge’s order was signed on Jan.
20 and entered on the docket yesterday.
GOLD, SILVER, PLATINUM AND PALADIUM
On Wednesday both gold and silver were in the minus column until late in the
session and that is when the wheels came off. Spot gold rose $35.60 to $1,699.80, as
February rose $47.00 to $1,711.50. Spot silver rose $1.16 to $33.09 and March rose
$1.30 to $33.28. The HUI rose 32.73 to 530.58 and the XAU rose 11.36 to 197.70.
The Fed now is the biggest owner of Treasuries. It continues to stabilize that
market. Someday those positions have to be sold. We wonder who they buyer will be?
We saw Jamie Dimon at Davos tell us that the Greek default won’t really affect
the US banking system. Of course it will have a negative effect, but he knows there is up
to $3 trillion available to cover up problems. This is the same money that will keep 5
Europe and the US out of recession this year. We are seeing a game of containment
that all the players know won’t work.
Mr. Bernanke says we’ll have low interest rates for three more years and inflation
will be 2%. Lies, lies and more lies. That sent gold up $70.00 on Wednesday and
Thursday a.m. We guess the pros do not believe the 2% part. Fed funds rate will stay at
zero. The program is thru 2014, three full years. It is any wonder we had stunning gold
and silver rallies. The result of this Fed policy is free money forever. Gold is being
recognized as the world reserve currency and an inflation fighter as well. You have to
look at manipulated markets as a method of control. The pressure on gold and silver
were in part a few months stage setting for the Fed’s statements and to cover up the
euro zone problem. We were correct gold and silver suppression were part of a plan to
cause them to rise from lower levels, and that is what happened. This rally should start
bringing in the public and if that happens, watch out. Do not forget as well we have QE 3
hovering in the wings.
In France, Sarkozy says he will leave politics if he loses the election in May.
There are big changes coming to France.
Ireland may have to hold a referendum on Europe’s new fiscal treaty even if the
government decides next month that a popular vote is not necessary to sign up for the
pact. The Irish have been given the shaft by their politicians paying 8.2% interest when
they should be paying 4% on EFSF borrowings.
The Dow rose 83 to 12,758, S&P rose 103 and Nasdaq rose 196 Dow points.
The 10-year T-note yielded 1.99%. The yen was unchanged at $.7769; the euro rose
.0090 to $1.3115; the pound rose .0063 to $1.5660; the Swiss franc rose .0082 to
$.9208 and the Canadian dollar rose .0059 to $.9948. The USDX fell .42 to 79.44.
Oil rose $0.85 to $99.80; gas rose $0.04 to $2.84 and natural gas rose $0.19 to
$2.80. Copper rose $0.04 to $3.85, platinum rose $30.80 to $1,583.20 and palladium
rose $12.75 to $693.30. The CRB rose 1.68 to 316.37.

On Thursday early gold was up $26.40 and silver $0.60. Spot gold rose $26.50
to $1,726.30, as February rose $21.00 to $721.10. Spot silver rose $0.61 to $33.70, as
March rose $0.27 to $33.40. It was a good but not as good a day as we had hoped for.
There will be zero interest rates for three full years and maybe more. Just be patient, the
gains will come.
Gold open interest rose 7,965 contracts to 434,997, as silver OI fell 509 to
102,516. The XAU rose 2.23 to 199.93 and the HUI rose 5.02 to 535.81. Today the gold
and silver options expiration ended and the commercials, banks, got their clocks
cleaned. The gains came as your government again limited those gains.
Today’s 7-year T-note sold at 1.359%, a record low yield, for $29 billion in notes.
Indirects – foreign central banks – bought 31.8% versus 39.4% average.
The Chicago fed said industrial production rebounded in December pushing the
National Activity Index to a five-month high despite the impact of the stronger dollar on
exports and inventory de-stocking. It rose .17 from November.
Angela Merkel has cast doubt on saving Greece from a financial meltdown. She
is more interested in driving the EU toward complete world government. The compact
“the ESM” is all she thinks about. It is a trap to relieve all EU nations of their sovereignty.
England has balked at the ESM sovereignty give away, and now Sweden has as
well. The opposition party Social Democrats say the draft is unclear and does not give
Sweden enough influence over issues discussed by Euro zone countries. On Monday a
rejection could be delivered.
The Iranian oil halt to the OECD will raise prices by $30 say the IMF. 6
The Dow fell 22 to 12,734, S&P fell 69 and Nasdaq fell 76 Dow points. The 10-
year T-note yielded 1.94%. The yen rose .0051 to $.7745; the euro rose .0017 to
$1.3104; the pound rose .0041 to $1.5680; the Swiss franc rose .0026 to $.9201 and the
Canadian dollar rose .0034 to $.9970. The USDX fell .15 to 79.43.
Oil rose $0.45 to $.9985, gas rose $0.01 to $2.85 and natural gas fell $0.12 to
$2.65. Copper rose $6.10 to $3.89, platinum rose $31.20 to $1,610.80 and palladium fell
$1.10 to $692.25. The CRB Index rose 1.05 to 317.42.
Early Friday came in slightly lower; at 8:40 am EDT gold was off $5.30 and silver
$0.20, after having been in those zones all morning. Then spot gold closed up $5.50 to
$1,731.80, as February rose $8.70 to $1,735.40. Spot silver roe $0.05 to $33.75, as
March rose $0.05 to $33.79. Downward pressure was a 20% factor in the gold and silver
rises.
Gold open interest fell 1.287 contracts to 433,710 and silver OI fell 510 to
102,006. The public is absent from these markets, but they will be along in good time.
In the COT commitment of traders report for silver banks increased their net
shorts by 4,639 contracts. In gold, commercials increased net shorts by 9,536 contracts.
The XAU rose 2.77 to 202.70 and the HUI rose 13.04 to 548.82; AEM rose
3.97%, or $1.50 to $39.29; GG rose 1.30%, or $0.63 to $49.24; SSRI rose 5.05%, or
$0.85 to $17.68; PVG was unchanged at $15.98, as PVG.TO fell 0.31%, or $0.05 to
$16.01; AXU rose 4.45%, or $0.33 to $7.74; HEL rose 2.22%, or $0.02 to $0.92 and
HLLXF fell 0.66%, or $0.01 to $0.90. All in all it was a very good week.
The $1.2 trillion increase in the debt ceiling is upon us to be followed by QE 3
and we must not forget the $1 trillion currency swap with the ECB. Then do not forget
the $900 billion from last August. That is $3 trillion. The next question is will the money
sent to the banks be fractionalized? That spells lots of inflation.
Then Mohsen Talaie, deputy foreign minister in charge of economic affairs,
said part of Iran's assets in European banks was converted to gold and shares
and another part were transferred to Asian banks. Iran withdrew 250 tons of its gold
reserves from Suisse Credit Bank worth five billion Swiss francs, and transferred them to
Tehran. Suisse Bern-based daily Der Bund reported that apparently Iran has withdrawn
700 tons of its gold reserves, worth sixteen billion Swiss franks, from various Western
monetary funds and transferred them to other unknown destinations. So, Iran seems not
to have significant assets in EU to be frozen. Gold reserves: The Iranian officials urge
the country's foreign exchange reserves stood at more than $100 billion. Governor of
Central Bank of Iran Mahmoud Bahmani said in July, 2011 that Iran's gold reserves
increased by $10 billion in value, while the Central Bank of Iran assures that the country
have sufficient gold reserves for 10 years. The CBI currently possesses 400 to 500 tons
of gold reserves and put behind all the problems caused by sanctions, Bahmani said.
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Iran to Sell Crude Oil for GOLD
It’s been reported by a publication called DEBKAfile that Iran is negotiating to sell its
crude oil to India and then China for gold. The story has been picked up by a number of other
commentators and analysts and appears to be true.
Nevertheless, the story traces to just one source: DEBKAfile and its confidential
“intelligence sources”. Because we have only a single source, and the story is so fantastic, we
can wonder if the story is true, false or even a hoax. Reports state that the government of India
(which plays a prominent role in this story) has been asked if the story is true, and refused (so
far) to either confirm or deny. That’s pretty good corroboration.
Therefore, lets proceed on the presumption that the fundamental story—Iran is preparing
to sell crude oil to India and perhaps China for gold—is true. If it is true, it may be the single
most important story of the year.
Reported earlier, the fiat dollar has been the World Reserve Currency since the end of
WWII and the only currency capable of purchasing crude oil on the international markets from
A.D. 1971 through A.D. 2000. The fiat dollar’s primacy in international oil trade created a
foreign demand for “petro-dollars”. That demand created an artificial, extrinsic value for fiat
dollars that is intrinsically worthless.
Saddam Hussein threatened the dollar’s primacy as the world’s only “petro-dollar” in
A.D. 2000 by selling Iraqi crude for Euros. We invaded Iraq in A.D. 2003, wrecked the country
and hanged Hussein, but it was too late to stop the world’s slow slide away from reliance on
“petro-dollars”. As a result, the dollar’s value as measured on the US Dollar Index has fallen
about 36% since A.D. 2000. 8
Earlier this month, in “Iran, Russia Replace Dollar With Rial, Ruble in Trade,”
Bloomberg reported:
“Iran and Russia replaced the U.S. dollar with their national currencies in
bilateral trade . . .. The proposal to switch to the ruble and the rial was raised by Russian
President Dmitry Medvedev at a meeting with his Iranian counterpart, Mahmoud
Ahmadinejad . . .. Iran has replaced the dollar in its oil trade with India, China and
Japan.”
That announcement constituted a body blow to the dollar. Insofar as China, Japan, India
and Russia (the 2nd, 3rd, 9th and 11th largest economies in the world) are beginning to trade in
their own currencies and without the intervening “aid” of US dollars, the dollar is clearly being
stripped of its status as World Reserve Currency and “petro-dollar”. Without that status, the
extrinsic support for the dollar’s value must fade and the dollar will be increasingly subject to
inflation and devaluation.
Note that the proposal to abandon the dollar was raised by Russia. There are more ways
to attack an adversary in this world than with mere guns or bombs. Merely choosing to use one
currency or another can constitute a virtual act of war.
Earlier this week, DEBKAfile published an article that, if true, may be the single most
important story of the past year. The headline reads, “India to pay gold instead of dollars for
Iranian oil. Oil and gold markets stunned”.
Oil and gold markets must be stunned. The U.S. government must be stunned. Those
who believe in the value of the dollar must be stunned. The world’s central bankers and New
World Order (both of which are built on fiat currencies) must be stunned.
It’s one thing for the nations of the world pay fiat rubles, fiat rupees or fiat Yuan (rather
than fiat dollars) for crude oil. Such payments hurt the fiat dollar’s illusory value, but leave the
power of fiat currencies and central banks largely untouched.
Paying for crude oil with gold rather than fiat dollars, attacks all fiat currencies and not
only threatens to terminate the dollar’s role as World Reserve Currency, but threatens to prevent
any new fiat currency from taking its place. From the perspective of the U.S. and New World
Order, paying gold for crude oil must be deemed an act of war.
According to the DEBKAfile report,
“India is the first buyer of Iranian oil to agree to pay for its purchases in gold
instead of the US dollar, debkafile’s intelligence and Iranian sources report exclusively.
Those sources expect China to follow suit. India and China take about one million
barrels per day, or 40 percent of Iran’s total exports of 2.5 million bpd. Both are
superpowers in terms of gold assets.”
1 million barrels at $100/barrel = $100 million per day. At current prices, we’re talking
almost 60 thousand ounces of gold per day = roughly 2 tons of gold per day. The U.S. and
London commodities markets may soon see an increased daily demand for 2 tons of physical
gold.
The sale of Iranian oil for gold is a mortal blow to any plans by the globalists to replace
the fiat dollar with some other “new and improved” fiat currency. If India and China are allowed
to start paying their debts with gold, the next “world reserve currency” could only be gold. No
more fiat currencies. No more “spinning money (fiat currency) out of thin air”. No more big
governments. No more central bankers.
If an agreement to pay Iran 2 tons a day in gold for oil is allowed to stand, the dollar’s
demise will be accelerated and the New World Order will be virtually destroyed. 9
I doubt that the globalists will allow the gold-for-oil deal to go through. They won’t
attack China or India, but the deal would be easily terminated if Iran were invaded, destroyed and
stopped from selling its crude oil to anyone for anything.
I’ll bet that if the gold-for-oil story is true, the U.S., Israel, Saudi Arabia, and some
elements of NATO will invade Iran within 60 days. A pretext (probably closing the Strait of
Hormuz) will be found.
In the meantime, if China and India spend 2 tons of gold per day for crude oil, the price
of gold should rise. Mathematically, that rise may not be very large, but the psychological impact
may be significant.
The increasing demand for physical (rather than paper-) gold will tend to stop the
manipulation of gold prices on the U.S. and London commodities markets. India’s and China’s
increasing need for physical gold will cause them to demand delivery of physical gold from the
U.S and London commodities markets which have heretofore excelled at selling non-existent,
“paper” gold at artificially reduced prices. As India and China buy and take possession of more
physical gold, gold’s price will rise.
Other nations will follow India and China’s lead and also demand to receive physical
gold at the artificially low prices maintained on the U.S. and London commodities markets. The
commodities markets will be forced to either sell their physical gold at give-away prices or raise
prices to true free market levels—and they will not give their gold away.
As the price of gold rises, the perceived value of the dollar will fall even faster, leading to
more and more inflation.
Again, if my understanding of money and global politics is roughly correct, the decision
to sell crude for gold will be perceived as an act of war against the fiat dollar, fiat currencies in
general, central bankers, the U.S., probably the EU, and the New World Order.
With or without pretext, the globalists will therefore invade Iran as a matter of survival.
Even if Iran is prevented from selling its oil for gold, you can bet that other oil producing
countries are approaching India and China in hopes of negotiating their own gold-for-oil deals. If
India and China will pay gold to India, why not pay gold to other oil-producing nations? I
guarantee that oil-exporting nations around the world are gearing up to ask to be paid with gold
for their oil rather than being paid in fiat dollars, or fiat anything.
• “By trading in gold, New Delhi and Beijing enable Tehran to bypass the
upcoming freeze on its central bank’s assets and the oil embargo which the European
Union’s foreign ministers agreed to impose Monday, Jan. 23. . . . . The EU decision of
Monday banned the signing of new oil contracts with Iran at once, while phasing out
existing transactions by July 1, 2012, when the European embargo, like the measure
enforced by the United States, becomes total. The European foreign ministers also
approved a freeze on the assets of the Central Bank of Iran which handles all the
country’s oil transactions.”
The EU and U.S. have agreed to impose an oil embargo on Iran. An embargo is an “act
of war”.
Iran has responded with its own “act of war”—selling Iranian crude for gold. Although
most people won’t understand, from the globalist perspective, selling Iranian crude for gold is a
far more aggressive and provocative act than closing the Strait of Hormuz.
A war—albeit without bullets and bombs—has already begun. We can expect that war to
soon escalate to the use of the bullets, bombs and invading soldiers.
The DEBKAfile report continues:
“Delhi is to execute its transactions . . . through two state-owned banks: the
Calcutta-based UCO Bank, whose board of directors is made up of Indian government 10
and Reserve Bank of India representatives; and Halk Bankasi (Peoples Bank), Turkey’s
seventh largest bank which is owned by the government.”
Now, the government of Turkey is peripherally involved in the sale of oil for gold.
We’ve seen recent allegations that one or more Iranian nuclear physicists have been
assassinated in order to prevent Iran from developing nuclear weapons. I won’t be surprised if
some of the bankers and/or government officials in India and Turkey who are implementing the
sale of oil for gold are also found dead in the near future.
A coalition of India, China, Turkey, Russia and Japan have joined together to buy oil
from Iran with their own domestic currencies or even gold—but not with the fiat dollar. In doing
so, this coalition has threatened the fiat dollar, fiat currencies in general, central banks, the United
States and the New World Order.
This is big. This is dangerous.
In some regards, this story may be more important that the German Nazis joining the
Italian Fascists prior to WWII.
It won’t be possible for the U.S. and/or New World Order to openly attack all of the
members of the new anti-fiat-dollar coalition. There is one central player in that coalition: Iran.
All of the other members of the collation are seeking to purchase crude oil from Iran.
Thus, if Iran could be stopped from selling its crude oil to everyone, it would also be
stopped from selling its crude oil to India (and soon China) for gold. The dollar would be
protected. Fiat currencies would be protected. Central banks, big governments and the New
World Order would be protected—if Iran could be stopped from selling any crude oil.
It may yet be possible to stop the sale of Iranian crude for gold by diplomatic means, but
I’d bet the odds favoring an invasion of Iran is now 4:1.
The sale of Iranian crude for gold might not be a fatal blow to the fiat dollar—but it could
be.
Gold is reemerging as the world’s only “global reserve money”. This reemergence is
directed by a coalition of nations that are apparently outside of and unsympathetic to the New
World Order. The existence of this coalition signals that neither the U.S. nor the New World
Order is really running this planet. The New World Order’s foundation (fiat currency) is
fragmenting. A significant part of the world has made a first bold step to escape they tyranny of
fiat currencies.
It’s possible and even likely that this first attempt to sell Iranian crude for gold will not
succeed—just as Saddam Hussein’s first attempt to sell Iraqi crude for fiat euro’s ultimately
ended in catastrophe. Within three or four years after Hussein’s first attempt failed, other nations
began selling their crude oil for currencies other than dollars. Similarly, Iran’s attempt to sell its
crude for gold may not succeed in the near future, but it will almost certainly have laid a
foundation for other nations to start selling their crude for gold.
When Iraq sold their crude oil for fiat Euros instead of fiat dollars, the U.S. gov-co
punished Iraq with nine years of invasion. Now, Iran is preparing to sell its crude oil for gold
rather than fiat dollars. Relatively speaking, selling oil for fiat currencies is a misdemeanor;
selling oil for gold is a felony—even a form of economic blasphemy.
God only knows what our gov-co plans to do to Iran. What are you going to do to protect
your finances as all this unfolds?
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EUROPE
A senior member of Chancellor Angela Merkel’s government rejected
suggestions that the European Central Bank take losses on its Greek debt holdings,
backing the ECB in a dispute with the International Monetary Fund.
“I can’t imagine that European politicians would allow third parties to make such an
indecent claim on our central bank,” Michael Meister, the deputy floor leader for Merkel’s
Christian Democrats and the party’s ranking finance spokesman, said today in an
interview. “That contradicts our philosophy.”
A senior member of Chancellor Angela Merkel’s government rejected
suggestions that the European Central Bank take losses on its Greek debt holdings,
backing the ECB in a dispute with the International Monetary Fund.
“I can’t imagine that European politicians would allow third parties to make such
an indecent claim on our central bank,” Michael Meister, the deputy floor leader for
Merkel’s Christian Democrats and the party’s ranking finance spokesman, said today in
an interview. “That contradicts our philosophy.”

German business confidence jumped more than economists forecast in
January to a five-month high, signaling Europe’s largest economy may avoid a
recession.
The Ifo institute’s business climate index, based on a survey of 7,000 executives,
climbed to 108.3 from 107.3 in December. Economists predicted an increase to 107.6,
according to the median of 42 forecasts in a Bloomberg News survey. That’s the third
straight monthly increase.
French presidential candidate Francois Hollande on Sunday said his real
opponent was not current President Nicolas Sarkozy, but the "world of finance." In
the first big speech of his campaign on Sunday, he said: "My principal adversary has no
name, it has no face and does not belong to a political party. It has never presented its
candidature and has never been elected, but it still governs," according to France24.
"This adversary is the world of finance." Saying he wanted to "change the destiny of
France," Hollande outlined his manifesto, pledging to cut presidential and government
salaries by 30% and create a tax on financial transactions among other goals.
Corporate defaults may almost double in Europe as companies struggle to
refinance debt and banks hoard cash borrowed from the European Central Bank
or use it to buy government bonds.
Europe’s default rate may soar to 8.4 percent or more, from 4.8 percent at the
end of 2011 as the recession bites and company financing dries up, according to
Standard & Poor’s. Petroplus Holdings AG became the latest victim of the tough stance
banks are adopting when the region’s biggest independent oil refiner said this week it
will file for insolvency after losing access to $2.1 billion of credit lines.
“It’s very challenging for anyone to raise money from lenders right now,” said
Andrew Cleland-Bogle, a Frankfurt- based director at corporate finance specialist DC
Advisory Partners. “Combine that with increased bank capital requirements and you can
see that although banks are getting money they’re very selective when it comes to
lending it. 2012 is going to be a very, very tough year.” 12
Speculative-grade companies have to refinance about 230 billion euros ($300
billion) through 2015, according to S&P. At the same time, banks and loan funds that
provided the initial funding are scrambling for capital or reaching the end of their
reinvestment periods and may be unwilling to extend loans.
Banks are using the 489 billion euros they borrowed at 1 percent from the ECB
under its three-year longer-term refinancing operation to scoop up government bonds
yielding more than 2.5 percentage points extra instead of lending the money to
companies.
AUSTRALIA
An early warning signal of where's the economy is headed has dropped to its
lowest in more than two years, providing more cause for the Reserve Bank to cut
interest rates to spur expansion.
The Westpac - Melbourne Institute leading index of annualised growth rate, which gives
an indication of economic activity three to nine months' time, slipped to 1.6 per cent in
November, from 2.3 per cent in October, suggesting weaker growth in the first half of
2012. The pace is the lowest since September 2009.
The annualised growth rate remains below its long-term trend of 2.9 per cent, Westpac
said.
"The growth rate in the index has slowed from the 4.5 per cent which was
reported for August and is now well below trend," said Westpac chief economist Bill
Evans. "It appears that the boost to above-trend growth we saw in July and August has
quickly faded and the outlook has evolved into a 'below trend' story."
Given the slowing growth in the local and global economy, Westpac expects another
interest rate cut to come when the Reserve Bank next meets on interest rates on
February 7.
“Since the last Board meeting in December we have seen ongoing deterioration
in the labour market while financial and economic conditions in Europe remain fragile."
"We expect the Board to cut the overnight cash rate by a further 25 basis points
to 4 per cent completing three consecutive meetings when the overnight cash rate has
been reduced," he said. "Even at 4 per cent, there is scope for the Board to go further
given the benign outlook for inflation."
The Australian Bureau of Statistics will release fourth quarter inflation later this
morning with the market expecting a 0.2 per cent rise, following a 0.6 per cent increase
in the third quarter.
RENTERS struggling to find a home in Perth should move to Melbourne.
The southern capital's rental vacancy rate has risen to 4.4 per cent, the result of a surge
in apartment building and slowing population growth.
Western Australia's mining boom has kept renters on their toes, with only 1 per cent of
rental homes vacant, December figures from SQM Research show. A vacancy rate of 3
per cent usually signals a ''balanced'' market.
Rental accommodation remains tight in popular inner-city suburbs such as Fitzroy and
Abbotsford.
Melbourne's high vacancy rate is likely to put downward pressure on rents, particularly in
places such as St Kilda Road and Southbank, where apartments and vacancies are
peaking. 13
Rental accommodation remains tight in popular inner-city suburbs such as Fitzroy and
Abbotsford, where vacancy rates hover around 1 per cent.
''The north-east suburbs of Melbourne, where there is demand for affordable rental
accommodation, have also been holding up better,'' said SQM's Louis Christopher.
Sydney's rental market remains relatively tight, with a vacancy rate of 2 per cent.
Settling into suburbs such as Gordon, Strathfield South and Rhodes has been made
easy, with between 8 and 13 per cent of rental properties vacant.
So, too, were they in prestige suburbs such as Vaucluse, Bellevue Hill and Elizabeth
Bay.
A ''seasonal spike'' in December pushed up residential vacancies from 1.9 to 2.4 per
cent across the country.
''What is of particular concern is Melbourne's seemingly ever increasing vacancy rate, a
figure that most definitely reflects an oversupply issue,'' Mr Christopher said. For the rest
of the country ''it is still a landlord's market and we are expecting rental increases overall
to be within the 4 to 6 per cent range''.
Canberra had a vacancy rate of 1.1 per cent, Darwin 1.7, Adelaide 1.9, Hobart 2.4 and
Brisbane 2.5 per cent, the figures show.
Aussie News:
Capital violence? Opposition Leader Tony Abbott has defended comments which
protesters have blamed for sparking yesterday's violent Australia Day clashes in
Canberra. Prime Minister Julia Gillard and Mr Abbott were both attending an awards
ceremony at a Canberra restaurant when it was surrounded by about 200 protesters
who had been marking the 40th anniversary of the establishment of the Aboriginal Tent
Embassy. Dozens of police were called to hold off the protesters who were banging on
the glass walls of the restaurant shouting "shame" and "racist". Riot police hustled both
leaders from the venue, with Ms Gillard stumbling and losing a shoe as she was dragged
to safety. The demonstrators said they had been incensed by Mr Abbott's comments in
Sydney earlier in the day, when he questioned the continued relevance of the Tent
Embassy.
Bourse bounce? The Australian share market is rising in morning trade as strong
commodity prices boost mining and gold stocks. At 11:35am (AEDT) the ASX 200 and
the All Ordinaries Index both were 0.6 per cent higher at 4,295 and 4,353 respectively.
The London Metals Exchange Index of six metals surged overnight, as did spot gold
prices, after the United States Federal Reserve announced it would keep interest rates
at near-zero until mid-2014 yesterday. Spot gold soared to a nearly 3-month high
overnight and has since settled to $US1,719.80 an ounce. Tapis crude oil closed slightly
higher at $US119.46 a barrel in Singapore overnight and West Texas Crude oil was
worth $US99.75 a barrel. The Australian dollar was buying 106.1 US cents, 82.1
Japanese yen, 81.1 euro cents, 67.7 British pence and $NZ1.29.
In limbo? Asylum seeker advocates say four refugee men are facing indefinite detention
in a Darwin immigration centre because it is unlikely another country will take them after
negative ASIO security assessments. The Immigration Department has recognised the
three Sri Lankans and one Burmese as refugees, but Australia's spy agency says they
have failed security tests. Darwin Asylum Seeker volunteers who visit the men say they
are traumatised because they do not know why they failed the tests, and can't challenge
the ASIO assessments. Network spokeswoman Fernanda Dalstrom says the men can't
face life in Australian detention, they can't be sent back, and only a few refused refugees 14
have persuaded another country to offer them asylum. "I'm aware of one case where
Sweden accepted a man who had received a negative security assessment from ASIO,"
she said.
Driveby shootings?Two men have been injured in separate Australia Day shootings in
Sydney's west. Officers from Operation Spartan are investigating both shootings, while
the Middle Eastern Organised Crime Squad is also examining the Guildford incident.
Spartan was launched earlier this month to probe more than 50 shootings in the past
year. Yesterday's attacks came after a tanning salon in the city's south at Rockdale was
peppered with bullets the night before.
Radioactive cows? Japanese authorities have lost track of nearly 3,000 dead cows
suspected of containing high levels of radioactive caesium. The cows ate rice straw
contaminated in the Fukushima nuclear disaster. Last year Japan's health ministry
ordered the testing of more than 4,500 beef cattle suspected of being contaminated with
radiation. But according to Japan's Yomiuri newspaper, so far only a third has been
tested, with the distribution routes of about 3,000 head of slaughtered cattle remaining a
mystery. Of the tested meat, about 6 per cent was found to contain radioactive caesium
above the acceptable safe limit. Food safety experts say that consumers would have to
eat a lot of the meat to suffer any damage to their health.
Bird flu? More than 10,000 ducks will be destroyed at two farms north of Melbourne after
an outbreak of bird flu. Health authorities would not say where the farms are located but
maintain the low-strength influenza strain is not a threat to humans. The virus was
detected during a regular check. Department of Primary Industry head of biosecurity Dr
Hugh Millar says the ducks will now be killed and the farms will be decontaminated to
contain the disease. "It's precautionary, it's preventative and we're not dealing with a
high-pressure disease situation such as we have seen throughout Asia," he said. "It's not
a public health issue. It's really not even an animal health issue, except we don't want
these viruses persisting." Dr Millar says the virus probably came from wild birds. "It is the
harmless, low pathogenic form, but we are jumping on this from a great height," he said.
The last reported case of bird flu in Victoria was in 1992.
Slowdown? The International Monetary Fund has reduced its forecasts for economic
growth in Australia this year amid the ongoing debt woes in the eurozone. In a briefing
note for the Group of 20, the IMF said it expected the Australian economy to grow by 3
per cent this year instead of its previous estimate of 3.3 per cent issued just four months
ago. A spokesperson for Treasurer Wayne Swan said the revision was very modest, and
similar to the Federal Government's forecast. Saul Eslake, chief economist at Bank of
America Merrill Lynch Australia, says the downgrade was to be expected given the
revisions the fund also has made to forecasts for other economies around the world. "I
think that the IMF's forecasts for year average growth of around 3 per cent is probably
more realistic now than the Reserve Bank's forecast of 4 per cent," he said.
Inflation calm? A rally in banking stocks helped the local share market close higher this
week after tame inflation numbers indicated interest rates could be on the way down
next month. The figures from the Australian Bureau of Statistics showed the Consumer
Price Index was flat in the three months to December thanks largely to falls in banana
prices as well as the costs of imported goods. The annual rate of inflation was at 3.1 per
cent, a figure economists say gives the Reserve Bank more room to cut interest rates. 15
CHINA
China’s property prices need to decline 30 percent to reach a “reasonable” level,
according to He Keng, a deputy director of the Financial and Economic Affairs
Committee of the National People’s Congress.
Housing prices will be at a “reasonable” level when they are equivalent to about
six years of salary for a family, the senior lawmaker said, according to the transcript of
an interview with China National Radio.
“Based on this, property prices may need to fall 30 percent,” He said, according
to the transcript on the broadcaster’s website. “But it doesn’t mean prices will go down in
every region, every city. The exact extent of the decline will depend on demand.”
China reiterated this year it won’t back away from housing curbs including tighter
mortgage requirements, while Beijing and the financial center of Shanghai are among
Chinese cities that have said they will continue imposing home purchase restrictions this
year. The nation’s home prices had their worst performance in 2011 in December, with
only two of the 70 cities tracked by the government posting gains, according to data from
the National Statistics Bureau this month.
Home transactions will drop 10 percent in China this year, according to Daiwa
Securities Capital Markets, while UBS AG said the curbs may boost supply to the
highest in a decade.
Developers may be facing one of their toughest years in 2012, Chen Li, head of China
equity strategy at UBS, said earlier this month. Their cash flow may be “exhausted to
zero” by the end of the year as some companies struggle to get financing for projects,
Chen said.
Price Slide
Prices are starting to slide as government curbs begin to take effect in lessaffluent cities. In the eastern city of Wenzhou, where a credit squeeze on smaller
businesses prompted a visit and pledge of financial aid from Premier Wen Jiabao in
October, prices slid 1.9 percent in December from the previous month and 6.9 percent
from a year earlier, according to the data.
Home sales last year rose 10 percent, the slowest pace since 2008, according to
data released on Jan. 17. In 2008, China’s home sales retreated for the first time since
the 1998 privatization of the housing market, dropping 17 percent.
The government may ease property curbs as early as the middle of the year as
an oversupply may be a “disaster” for developers, said UBS’s Chen. Supply will peak at
1.5 times to 1.6 times demand, Chen said.
A measure tracking property shares on the Shanghai Composite Index has
climbed 6.7 percent since the start of the year, the most among the five industry groups
making up the benchmark stock gauge.
HEALTH – Herbalist – Wendy Wilson
IT HAS STARTED
I’ve been alerting you to the facts that your dietary supplements are under attack.
Recently by order of the FDA, a supplement company in California (Infinity Marketing
Group, Inc.) was raided by US Marshals and over $70,000 worth of supplements was
taken. What was their crime? They imported an herb containing a plant compound called
ephedra (ephedrine). This is an herb used in Chinese medicine (Ma Haung) but you
may recognize the ingredient in diet products. You may also recognize it as 16
pseudoephedrine used in products like Sudafed. Used properly, this herb is very
effective for asthma, as a decongestant and to stimulate metabolism to burn fat. It has
been approved in the past by FDA and was on its GRASS (Generally Recognized as
Safe) list. So, what’s the problem? The ingredient Ephedrine has very similar chemistry
to amphetamines and methamphetamines.
“We will continue to take enforcement action that prevents potentially harmful
products from reaching consumers and endangering their health.” Dara Corrigan,
FDA Associate Commissioner for Regulatory Affairs
LICENSED TO KILL
The government and the FDA can give license or power to end life. Any dangerous
substance which can be improperly used or abused is a risk to human life; such as
alcohol, tobacco, prescription drugs and now some herbs. Should a hemophiliac misuse
a garlic supplement, which thins the blood, and is hospitalized or dies would the FDA
remove garlic from their GRASS list and restrict access? In the 1990’s athletes and drug
dependent individuals abused herbs containing ephedrea and that is how we lost the
right to use it freely. The FDA reversed this decision in 2004 but by 2006 we had new
regulations on ephedrea because they didn’t want the herb being used like marijuana.
Anytime you purchase anything containing ephedra you are required to give you name
and address and it is kept on file for two years. You could be reported to the Federal
Attorney General if you purchase the stuff too often, in large amounts or by way of a
suspicious payment. So, watch the use Sudafed or diet aids. You may ask if getting the
raw herb would be any better. Nope. You can only purchase very limited amounts of
herbs containing Ephedra (such as a handful) and that is why Infinity Marketing Group
got into hot water (4000 pounds). I guess they forgot that the FDA, US Customs and
Border Protection, Immigration and Customs Enforcement and Drug Enforcement
Administration all communicate with one another now.
SIDE EFFECTS
If you happen to actually get some ephedra you could experience side effects if you take
too much of it such as; sweating, increased blood pressure, skin blushing, acne,
digestive upset, lack of appetite, urinary tract dysfunction, insomnia, restlessness,
shortness of breath, headache, dizziness, blood sugar imbalance and if you really
overdose you can experience death. So, yes there is risk if you misuse the herb. Take
too much and you will have an adrenaline rush, which can stop the heart muscle
(probably why body builders and drug addicts are attracted to it). However, where
Ephedra made headlines in the 1990’s and got yanked off the shelves was when a pro
athlete used it with other stimulants and his cardiovascular system crashed under the
strain and he died. One herb, one headline death and viola! The excuse the system
needed to implement more regulations was born. However, do we see antidepressants
producing suicides in the thousands yanked off the market? No, the product gets a
warning label; “may produce suicidal tendencies.” Are the manufacturers of
antidepressants raided and their product confiscated? Of course not.
FISH OIL MAYBE NEXT
Remember the elderly like their omega-3’s and they are under attack by the system.
According to Consumer Reports and a published review on 15 top selling fish oil
supplements, about 4% fell below accepted quality. Again, this gives way to more
regulations. However, the report stated that the oils did meet the EU regulations and the
US Pharmacopeia standards, which are worthless standards in my opinion. You see, if 17
the system determines that supplement companies cannot produce an acceptable
standardized product they will either ban it or allow companies making standardized
products (such as pharmaceutical giants) to produce them. The best way to get a
standardized product is to use synthetic ingredients. The state of California has
implemented Proposition 65 omega-3 laws. The Global Organization for EPA (GOED)
felt that the Consumer Reports review which mentioned oils that tested higher than what
the Proposition 65 omega law requires should have disclosed the actual data in the
review. The critics seemed to zero-in on the oils which also contained natural lemon oil.
After all is said and done the tests used to determine quality for industry standards
(determines spoilage) is not all that reliable (Source: Consumer Reports). I anticipate
that flavored fish oil products will soon be removed from the market. Apparently the
added lemon oil or other natural flavorings makes it impossible to determine freshness
or rancidity. Flavored fish oil has been growing in popularity and unless they can come
up with a more accurate test, I fear that it won’t be available.
A BRIGHT LIGHT
There is hope. The dietary trade associations have joined together to call for the FDA to
revise their new NDI (New Dietary Ingredient) requirements. The American Herbal
Products Association, the Consumer Healthcare Product Association, the Council for
Responsible Nutrition, the Natural Products Association and the United Natural Products
Alliance has asked the FDA to reconsider these guidelines. These associations in no
uncertain terms told the FDA in writing last July 2011 that such unreasonable regulation
would burden the industry, place unreasonable requirements on businesses (especially
smaller firms), and create unreasonable barriers of entry to newer market entrants
without any benefits for consumers. I’m guessing these associations won’t back down
because they all stressed they were committed to seeing a substantial overhaul of the
FDA’s regulations. Well, they did their due diligence and the ball is in the FDA’s court
now. To date there has been no written response from the FDA addressing their
concerns. My question is at this point, is it possible for the supplement market to work
with the FDA? Obviously we’ve seen the FDA’s dirty little petticoat and their intentions
are very clear. This is something we must put on our prayer list.
WHILE YOU CAN
At this point with so much going on in the world it is best to look at the worst case
scenario and plan for that. If the worst doesn’t happen, that’s great. If it does, then you
are prepared. Be selective when stocking up on your supplements and make sure you
get products that have a long storable shelf life. Apothecary Herbs has products with a
shelf life of 5, 7 and 10 years. The powdered mixes will have a 5 to 7-year shelf life and
the tinctures (liquids) at least a 10-year shelf life. Store your supplements away from
heat or light. Refrigeration is not necessary unless you do not have environmentally
controlled areas. Do not store them in attics or car trunks or any area that will get hot.
Avoid exposing them to moisture as well. Do not store them near microwave ovens or
powered electronics. I would stock the immune boosting formulas first and then get the
toxin removal (Organ Cleansing) products. Save on half and full case discounts in the
Vitamin Vault at Apothecary Herbs. A year’s supply package will deliver immune
boosting and toxin removal. Pick up a copy of The Power Herbs e-book for introductory
information on how to use herbs and natural therapies. You can purchase your copy for
$14.99 from Apothecary Herbs http://www.thepowerherbs.com or call for your free
product catalog toll free 866-229-3663, International 803-746-0219, where your
healthcare options just became endless.