After all the dust settles it looks like the UK is the odd man out. They are refusing to join in the fix. They may be the smart ones. Not too many good options for the other 26 countries. The one difference between them and the US is we have control of the printing presses basically for the world. How long that will continue is the question. It looks like the UK doesn't want to give that option up for themselves. Being in the union limits your choices. The smart move for some of the countries might have been to get out of the union and default.
There are some other big problems for the markets to digest. Hedge Fund Research says " the average fund lost 4.3% this year. They report that 213 of them have gone under this year. Jeff Holland managing director of Liongate Capitol says "It is sentiment, rather than fundamentals, that has driven markets this year." "Markets have been dominated by high correlations and continue to behave based on political decisions," "The biggest risk is investing in a market that is uncertain. Guys who have tried to predict the political events in Europe are the guys who have got their fingers burned this year,"
At EconIntersect we have always said sentiment trumps all else. If you perceive there is no fix for the problem, facts and charts don't always matter. Sentiment and trend are your friend! Neither is going our way at the moment.
The next big problem: corruption in the market place. Why have no Wall Streeters gone to jail for the corruption? Could it be the perpetrators are in bed with the politicians and bureaucracy? In a recent interview with Jim Puplava, Ann Barnhardt, who recently closed her brokerage business, Barnhardt Capital Management, because she believes her clients money is not safe there anymore had this to say. "The actions, specifically by the Merc after the MF Global collapse were unprecedented, unfathomable and completely and totally intolerable. The Merc itself basically did the equivalent of sticking a nine millimeter in their mouth and pulling the trigger by not stepping forward, backstopping the MF Global client accounts and at the very least, the Merc should have allowed the MF Global customers to liquidate their accounts and then transfer to other firms. What the Merc did was the worst possible thing, they froze those people out of their accounts and did not allow them to liquidate while the markets continued to trade. This has never happened before. This was a complete breach of fiduciary duty by the Chicago Mercantile Exchange itself to the point that it literally has destroyed the entire paradigm." How could those customer funds be missing. They are not missing. They were stolen. They were stolen by Jon Corzine and his cadre of associates at MF Global. Nothing even close to this has ever even happened before and it is the function of the Mercantile Exchange itself, the reason why the exchanges exist is that they stand in the middle of every transaction and they act as the de facto counterparty to every single transaction so that, for example, my clients never had to worry about the credit worthiness of the other individual, whoever it might be, who is on the other side of any trade that they did."
We have reported on this in the past. If Ann's assessment of this problem is correct there may not be many places to hide. She goes on to say: We are now living in a lawless, Marxist, Communist, usurped, what used to be a representative republic but is no more. This is no longer a nation of laws. This has now transformed into a nation of men. It does not matter what crime you commit. In the case of Jon Corzine, this man has stolen in excess of a billion dollars." Why would a man like that even engage in a nefarious plot like this? Because he knew going into it he could get away with it. And the reason he could get away with it is he is in tight with the Obama regime. He is a crony of the regime. This is Marxist Communism. There is no rule of law. And these people, these poor MF customers are just sitting out here helpless to do anything because there is no law enforcement because this is no longer a nation of laws. The rule of law no longer exists. " "The only lesson that these criminal degenerates learned from the 2008 situation was that they could do anything they want and that pimp daddy government would bail them out." "And we now know that the government is absolutely stuffed to the gills almost exclusively with this same type of moral degenerate culture. These people that are in the government not just the Congress and Executive Branch but also in the bureaucracy, they are in it for themselves." "These people are nefariously trying to destroy everything in this country. It is called the Cloward-Piven strategy. Go in and destroy and collapse the entire economy, everything and then rebuild a new Marxist, Socialist, fascist state out of the burning rubble of this destruction. This is intentional. This is nefarious. This is not a function of incompetence. It is a function of malice of forethought and conscientious theft and destruction."
According to Ann we could be on the verge of a total collapse of our financial system. Europe is too big to solve, the government is corrupt, and nobody is doing anything about it. There is no integrity in the system anymore. If this is the case what can we do to protect ourselves?
Get out of all paper and not just the commodities markets. This is going to cascade through everything. It is going to get into the equities. It is going to get into 401ks and IRAs, it is going to get into pension plans and so on and so forth. Total systemic collapse. Get out!" "Anything that is on paper anything that involves a promise or a commitment is no longer valid because as we said there is no rule of law anymore. People can steal from you. Your money can be confiscated. And think how easy now it is to confiscate wealth. Most of our wealth in this society exists as zeroes and ones on a computer server. It takes no effort whatsoever to steal zeros and ones on a computer server. So what I have been telling people is you need to get into physical commodities. And the rule of thumb is if you can stand in front of it with an assault rifle and physically protect it, then it's real, it is a real commodity. That includes food, that includes water, that includes long guns and ammunition. That includes fuel. That includes precious metals, gold and silver coinage. Most especially silver coinage because silver is the metal of barter and transaction and currency. Gold is the storage metal because it's so valuable per ounce. And also, silver is extremely undervalued relative to gold because that market has been synthetically suppressed for the last several years by again, these nefarious actors. So yeah, reallocate into physical commodities.
At EconIntersect we have been advocates of the commodities for some time. Wheather Ann is right or wrong we feel you can't go wrong with physical gold and silver. The whole world is going through a metamorphosis and we believe safety is paramount. The Aden Sisters who write the Aden Forecast agree. "We recommend staying put for the time being. The market is volatile, mixed and risk remains high. We are far safer staying on the sidelines. Maintain caution, be patient and let the market tell the story.
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