- As the saying goes : "In a ham and eggs breakfast,
the hen is involved, but the pig is committed".
- By my reckoning, Paulson and Central Banks are the chicken
and the world's (stupid) taxpayers are the pig. We have no choice in
the matter, and by the way, to get ham, the pigs are always slaughtered.
- My current fear is that we may be in near term for continued
financial meltdown - something is definitely in the works in Washington
- All hell is breaking loose - the DOW closed down 670
points last evening and today asian markets have been battered down again
with the NIKKEI losing 10%, most other asian markets are down 7 - 9 %.
- Oil has corrected down again this week so far as the
outlook for world-wide recession is growing while gold and silver are
now moving higher. Overnight figures are :
- $82.63 -3.96 -4.57%
- $929.50 +43.00 +4.85%
- $6.67 -0.16 -2.27%
- I expect another "Sunday announcement" from
officials - the G8 Finance Ministers are meeting today in Washington D.C.
and the IMF are deliberating. Likewise, Pres. W. Bush is to give ANOTHER
announcement today at 16:25 EST. What will this be about ? There could
be a bank moratorium in the pipeline. Or more drastic measures...
- The chart above (courtesy of D. Norcini | Tech Lines:
R. Buss) shows that in Euro terms, gold is breaking out and making new
highs - very interesting indeed. As well, in other currencies, Gold is
rocketing to new highs - this is the true currency of last resort as other
currencies devalue in purchasing power - this will become more apparent
as higher inflation in the pipeline comes...
- The prospect of hyperinflation is now becoming a REAL
possibility - trillions of dollars are being pumped and nothing is happening
in the credit markets - FEAR is enveloping world markets. We now think
there may be another concerted effort to engage in socialist methods
of the State buying up everything, guaranteeing loans, etc. as in Iceland,
UK, etc. Welcome to October 2008. We would not be surprised to see more
civil unrest as people realize they have been cheated out of their lifetime
savings and pensions.
- If you ever thought to be invested in gold and silver
and hard assets - NOW is the time. A storm is brewing over the world
economy and PAPER MONEY is not helping anything it seems. Caveat : we
are also sure that "gold enemies", i.e. Central Banks and their
banks, will try to keep the price on gold below $1000 - there is a fight
coming - Gold .vs. Paper - do not underestimate this fight - it will be
very dirty and it is your government fighting against you and your wealth.
- Here are few recent remarks from elected officials in
the US government:
- US House of Rep. Speaker Nancy Pelosi : "It's not
a bailout, it's a buy-in"
- W. Bush : "We have a sound economy"
- Hank Paulson : "Our underlying financial system
- Hank Paulson : "The US Dollar is strong"
- As an ambitious student of history in all its twisted
and convoluted probity, or lack thereof, a thought from my Berlin (a rather
appropriate location) office below. The point being, the SPIN is no
longer working - the Emperor, or better said, the Empire, has no clothes.
He is now laid bare for all to see - now the financial spin doctors are
about to foist even more upon us - just wait.
- The Big Lie is a propaganda technique. It was defined
by Adolf Hitler in his 1925 autobiography Mein Kampf (My Struggle) as
a lie so "colossal" that no one would believe that someone "could
have the impudence to distort the truth so infamously".
- "If you tell a lie big enough and keep repeating
it, people will eventually come to believe it. The lie can be maintained
only for such time as the State can shield the people from the political,
economic and/or military consequences of the lie. It thus becomes vitally
important for the State to use all of its powers to repress dissent, for
the truth is the mortal enemy of the lie, and thus by extension, the truth
is the greatest enemy of the State."
- And here was a response from Joseph Goebbels to Churchill
and Co. -
- also very interesting.
- "One should not, as a rule, reveal one's secrets,
since one does not know if and when one may need them again. The essential
English leadership secret does not depend on particular intelligence.
Rather, it depends on a remarkably stupid thick-headedness. The English
follow the principle that when one lies, one should lie big, and stick
to it. They keep up their lies, even at the risk of looking ridiculous."
- Like I have said in the past : Repeat the government's
mantra over and over again until you believe it : Strong Dollar, Sound
Economy, All is Well, Jobs will not be Lost, Economic Fundamentals are
- By the way, Gordon Brown, UK Prime Minister, is now seemingly
intent upon using Anti-Terror Laws against Iceland for sandbagging UK
citizens accounts in icelandic banks which have been nationalized- no
payouts at the moment, if ever. Gordo, why dont you just bomb them ?
God knows, there can be a case made for the outcast Icelandic Taliban
in Iceland's extensive cave systems... briefcases full of Kronor, Russian
Rubles** and even a few of the Queen's pounds - this is absolutely hilarious
if it were not totally true.
- (** note: Iceland was turned down by the US, UK and Euroland
when submitting for help on a loan bailout for its banks. In the end,
it turned to Russia to secure an $8 billion loan so much for so-
called "friends and allies". I suppose Russia will now have
secured submarine bases in the North Atlantic)
- As I stated above - the "Financial Powers that Be"
- have been meeting and are in close consultation,
- are meeting today in Washington D.C.,(IMF and World Bank)
- will continue to meet on the weekend in Washington D.C.
- A final chart : in the last months, hundreds of billions
have been literally created and thrown into the financial arena to try
and "calm the markets". We should realize that the total amount
of OTC derivatives are on magnitude of 16x the world's entire GDP, or,
approximately 650 trillion dollars in June 2008.
- If this is the amount of "bad debt" on the
books, and which must be cleansed, then I submit we shall soon see complete
meltdown of the financial system and of general solid businesses with
no access to credit to finance things like payroll, inventory or investment
plans - they will collapse.
- It is pure folly to hear politicians and news stories
of "Are we in a recession?". My answer is beginning to turn
- I now say we are entering a Depression - as I have often surmised in
my GMR Newsletter. And if things continue on this route, we shall be
entering a hyperinflationary depression. Why? Because now the Central
Banks are likely to embark upon one of the greatest reflation programs
ever witnessed in the modern world.
- Hyperinflationary because the world is facing a deflationary
menace - that of too many goods in an environment of fear, panic and need
to save. Thus those goods will linger and stagnate. No new widgets or
gadgets need to be built. The bad debt is coming home to you - now.
- It was interesting to read a few reader comments sent
to me, which said "Thank God I did not invest in gold" - it
has dropped so much" . My current thoughts are : those readers shall
likely eat their words if things get wholly out of control. In any case,
the amount of reflation necessary will be horrendous. Funny, but looking
at the gold charts, I see gold in most major currencies has zoomed up
(NOT down) - hard to understand those readers. The major stock indices
are getting hammered down 30, 40 or even 50 percent while gold has maintained
a steady uptrend. That is why gold is STILL in a stealth up move - when
and/or if "joe public" realize this, there will be a jump.
I expect at that point, gold controls to be enacted. How and When and
What I don't know. It all hinges on this ONGOING bailout and how the
markets respond - it's no longer the "financial engineers" in
control, it's the politicians, the bureaucrats and the state-sponsored
hoodlums. I leave the rest to your imagination. And if you're wondering,
yes, I am considerably perturbed at these bumbling idiots...
- Just to note, as I had predicted, we see Central Banks
and their recent press statements:
- inflation is coming down ; it is no longer a major threat
- the economy is weakening - we have room to cut rates
- Are we headed to a full-blown Kondratieff Winter? ...
certainly it looks so. Finally, I want to throw in an interesting astrological
tidbit - I read and study alot of this but keep it mostly to myself.
- We have entered a Pluto-Capricorn cycle having just passed
out of the Sagittarius. Capricorn house is for the next 16 years and
is indicative of deflation, fear, panic, less freedoms, low returns.
- Both Kondratieff and Pluto in Capricorn point to investment
in commodities, food, agriculture.
- Randolph Buss
- Randolph Buss | DINL
- located in Berlin, Germany | Zürich, Switzerland
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