Perpetual QE foreva!

QE3 was announced yesterday, right on schedule.  This more than likely will give the stock market enough steam to keep it from topping out, and having a serious market correction before the November election.  The fact that Bernanke announced QE3 while the S&P 500 was at multi-year highs shows that i)they knew something bad would happen if they didn't do it right now, and ii)this is an extremely political move to help his friend Obama look good.  

Gold and silver moved sharply higher off of multi-month lows a couple weeks ago, both breaking through multi-month descending trend lines.  This IS the next big move in Gold and Silver.  The last year has given all of us plenty of time to accumulate the physical metal cheaply, and or move more assets into physical metal.  This time silver will go through $50, and Gold through $2000.  They have just announced perpetual QE forever!  The Fed said they will continue to buy mortgage backed securities until things look like they are improving.  Well I've got some news for ya, their zero interest policy now through 2015 is exactly what is killing the economy!  So things are virtually guaranteed to never get better!  I am still sticking to my guns that next year will be a horrible year for the economy, the stock market, and our freedom.  Eventually the stock market will not increase on new rounds of money printing, and this stock rally will not be as much as the last two doses of QE.  Each new round has had less and less of an effect, until it has none at all, and then the game is pretty much over.  

What this means is extreme dollar devaluation, higher prices(oil has already spiked), and a large shift to inflation-hedging assets.  These are the last stages of a collapsing empire, almost textbook historically.  It is very easy to see where things go from here, if you are willing to open your eyes and see it.  I wish everyone good luck.

This article below is just a warning as to how your investments are treated today in a big financial firm.  If you keep a lot of money with a big financial firm, and that firm files for bankruptcy, do not expect to get a penny back.  They do not keep client funds segregated anymore, and they WILL use your account money as collateral in bankruptcy court to pay off their debts and expenses.  This has happened twice now with very large firms, MF Global(billion dollar plus) and Peregrine Financial(multi hundred million).  This is another reason I push precious metals so hard, if you don't hold your asset in your hand, you do not own it!  This also goes to those who keep their precious metals in safety deposit boxes.  When this whole thing comes crashing down, and you need your gold and silver the most, the banks will be closed!  It is called a bank holiday, and it could last from weeks to months.  It happens for several reasons, and a financial crash is the main one.  This is a repeating historically documented event designed to separate you from your assets and money.  So be aware!  This is the new reality, and the future is not pretty.  But there are still things you can do to protect yourself.  

http://www.jsmineset.com/2012/09/12/sentinel-ruling-and-what-it-means-for-your-street-name-shares/

Out of Order

I guess the billions of dollars the FHA along with Freddie Mae and Freddie Mac are losing, and continue to lose is not a good enough reason to look at the housing market from the other side of the coin.  It is amazing how ignorant some of these congress people are.  It is of my current belief, that another main reason we are in such a mess is that congress doesn't weigh the NEGATIVES appropriately along with the positives in the legislation they create.  It is obvious that they do not approach anything from a realistic nor logical standpoint in Peter's testimony to congress.  They decide they want to pass a bill, so they bring in several other "experts" in the field that benefit most from the government subsidies they look to create!  Well of course they are going to back your plan if they are going to get a piece of the pie!  Where are the congress women and men that play devil's advocate, and look at the negative consequences as well as the positive.  Why isn't congress asking the tough questions along with Peter, and not asking, then ignoring his answers because he doesn't agree, and don't like what he has to say?  Is it really that hard to understand why we have such large problems in this country, and can't move forward on anything, when our whole legislative process is fundamentally flawed from the beginning?  

This is such a basic concept in regular business it's almost hysterical that congress acts like this.  Just as Peter says, before a private enterprise is willing to embark on a business venture, to ensure success, all potential risks must be weighed, and priced in to the final product.  When government guarantees ANYTHING, you completely bypass that process because who cares if the thing goes bust, the taxpayers will pick up the tab if it doesn't work out.  This is why Peter emphasizes so much on the mispricing  of risk.  Government itself is the reason!  No wonder they can't fix it, they are the problem, and would rather sign a new bill than do enough due diligence to realize maybe they just need to back off.  This stuff is gonna go down in the history books gentlemen, and we are all gonna look like idiots for supporting such a silly democratic process.  And this is why I cannot, and will not choose to support the choices of government that cannot make choices based on rational thought, but chooses to do so out of arrogance.  This will end very badly.  Revolution will come to America one day, it's the only way the establishment will be torn down and started anew.  It's a slippery slope all downhill until that day comes.

http://www.europac.net/commentaries/out_order 

Economic update: Something's a brewin'!

Well first off it looks like the metals may have finally bottomed at yesterday's lows of gold @1628 and silver @31.20.  Daily indicators are turning up, and we have had a strong rally since then.  Keeping my fingers crossed for a good rally here.

Ok now into the not so good news.  Stock market recently hit new 52 week highs, but as in 2008 the market was not a very good indicator of underlying economic issues.  And with our disastrous highly inflationary monetary policy, along with record low volumes, more than likely the market will drift higher until it just doesn't.  So don't let this fool you, bad things are brewing under the surface.

11 out of 13 economic indicators have missed expectations, and the two indicators that beat expectations are questionable at best.  They were jobs and car sales.  Well you should know by now of the manipulation, and the massaging of the jobs numbers.  Remember that this is an election year, and things must look rosy until November for Obama's re-election campaign.  And car sales are up due to channel stuffing.  Whenever a car is shipped from the manufacturing plant to the dealer it is considered a sale(I know, doesn't make much sense does it?).  So when actual sales are looking bleak, dealerships boost inventory to get this number to rise.  This is a perfect example of why you must look into the details of government's statistics and indicators vs. taking them for face value.  Under the surface, another bailout of GM is in the rumor mill.

http://www.zerohedge.com/news/bursting-permabullish-bubble-11-out-13-economic-indicators-have-missed 

13 month lows in January for the new home sales MoM(month over month) change, and the largest downward 'reality' revision since March 2009.  New home sales make it 12 out of 14 economic misses.  As I have said before, this housing thing still has a ways to go.  I was talking to my buddy Chris that grew up in my hometown of Port St. John, and told him it was possible that home prices could see 1980's levels due to an over-correction, from an extreme over-valuation from last decade.  Sure enough, he looked it up and the house his Father bought in 1984 for $74k is now worth a staggering $76k.  Prices will remain stagnant to slightly down for the next few years at best.  And these are at record low interest rates, with 3% down FHA mortgage offerings.  Just wait until interest rates rise....

 http://www.zerohedge.com/news/new-home-sales-make-it-12-out-14-economic-misses

And although Europe and Greece was just bailed out again by their central bank this month, the charts are looking no bueno for the short to medium term.  Bailout number 3 was being talked about as the 2nd deal was being wrapped up.  Kind of silly isn't it.  Eh, forget about the fundamental problem, let's just throw some more money at it, and see if we can't grow(print) our way out of the mess.  Leverage in the Euro banking system is still huge, and debt to GDP levels are growing exponentially.  

http://www.zerohedge.com/news/3-charts-why-eurosis-never-really-went-away 

Every time you print a trillion dollars, the effects it has over the broader economy decrease.  So eventually as debts grow, and you print money to cover your deficit, the stimulus side of it turns to nada.  And when inflation increases sharply without wage growth doing the same, more citizens turn to the government for aid, increasing government expenditures.  This inflation in turn causes squeezed margins in businesses, forcing them to close shop or send more jobs overseas.  Sending more people to the government for handouts, causing government revenues to fall, and expenditures to rise once again.  This is called an inflationary death spiral.  It's simple math really.  If everyone could just print their way to prosperity, everyone would be doing it!  But alas, the ones who have tried(most recently Zimbabwe) have destroyed their currency in the process.  Well we are well on our way, and we are about to enter another major war to help speed up the process!  So this is why I so strongly believe in opting out of the system, and I rely on the four G's, and NOT on the government.  Those four are God, Gold, Guns, and Grub.  If you have those, you should come out alright.  Have a great weekend!

Terminated CBO Whistleblower Shares Her Full Story With Zero Hedge, Exposes Deep Conflicts At "Impartial" Budget Office

And deeper into the rabbit hole we go. I know I have been pounding the table about corruption in government, but this is more absolute evidence that numbers are being fudged, and extremely important issues are being swept under the rug. These are Harvard and MIT professor's with Ph.D.'s advising the government inaccurately, and terminating anyone who doesn't share their views. This is absolutely ridiculous, as diverse views in extremely important future and current issues helps to cover all aspects of what could go right or wrong in various policies. So now it is obvious that the government's view of certain issues are being blurred by their so called "professional advisers".

So now we have to assume a couple things about the graduates coming out of these Ivy League schools, from which our famous Obama, Bernanke, and several others have graduated from. Either the information they are taught about finance and economics is bad information, or someone else is behind the scenes pulling the strings here. And I am pretty sure it is a bit of both. Let me explain. Most colleges teach Keynesian economics in some form or another, and I believe at its extremes in the Ivy Leagues. Keynes was the one who believed in using stimulus and money printing during bust cycles to help boost the economy. Well we have Keynesian policies in overdrive right now, as we are printing ourselves into oblivion to cover massive deficit spending. Isn't it funny how virtually no one talks about the other side of the coin? That maybe Keynes was wrong? That maybe things aren't getting better because we are using the same failed policies? Well Ron Paul talks about it very openly and bluntly, and we all know what the media have to say about him now don't we? Right wing conspirator, crazy, and nutty libertarian come to mind. These guys beliefs that they are right is so entrenched in their mind, that if you think differently you are either shot down, re-located, or fired. To me that smells trouble, big time.

But at the same time central bankers of nations all over the world control the monetary policy of each of those nations, and in turn force the hand of the governments of each nation. And if they are all Keynesians(which they are) then it's easy to see why we are headed where we are. But, and this is a big but, there is something going on here that can't be denied. When you read what she has to say about her experiences with her superiors at the CBO, how they get rid of her, and how shady it all seems, you really have to ask what is really going here? I know there is lobbying, and those guys have a huge influence over legislation that is passed. But this is different. Reading the article you can feel the fear from these guys who railroad anyone with a different opinion, and then get rid of them as they expose the truth to the very people they are trying to hide it from.

"After my termination, Director Elmendorf stated that I should have followed directions from the more knowledgeable and experienced Chief Economist Lucas, taken the opportunity to learn from her."

Even though this woman had a Ph.D. herself, it is very obvious from this statement that her opinion was neither needed nor wanted, unless it lined up with their views. Unfortunately I feel this is all too common, and deeply ingrained throughout the culture of Washington. And until this changes, real change will never be allowed. And it is truly unfortunate that it is a high probability that we will never find out what this "dark force" is that keeps these officials from telling the truth, and more importantly why they cover it up as if their life depended on it.

http://www.zerohedge.com/news/terminated-cbo-whistleblower-shares-her-full-story-zero-hedge-exposes-deep-conflicts-impartial-

Some quick thoughts on the federal government, and a free market economy

So obviously abolishing the EPA, and federal regulation would not be an overnight fix. The whole idea for a free market to operate, is that it will eventually regulate itself. As an example, in a free market without lobbyists, companies would be required to uphold stricter guidelines without being able to buy out of or around issues. Then if something bad happens(like a BP type accident) they would be held fully accountable, and have the risk of actually going bankrupt. So now it is in the companies best interest to absolutely make sure your emergency close-off valves(or whatever the case may be) are in working order. Rather than just not giving a damn, and knowing that your political ties can spin the whole ordeal, and partially/fully bail you out. But when you read deeply into the federal government's individual departments, you find extreme levels of corruption and a serious lack of over-sight. Truth is there is no accountability at the federal level. And when it comes up that some large level of corruption is exposed, there is mass cover-up instead of it being corrected, and the proper persons being held accountable and fired.(Recent examples of MF Global, and Solyndra) 


"Fooling some of the people all of the time", written by David Einhorn is an amazing book and a perfect example of this. The level of corruption just from 2001-2008 in the SEC and the SBA will make you sick. Especially at the great lengths they go to cover things up, just because they are up to their eyeballs in their own shit. The DOE is a joke, and its biggest role is indoctrinating the American people, and controlling what and how our kids learn. There is no other reason to have some of the world best schools, and smartest graduates, yet have our school system rated in the high twenties out of the entire developed world. It is in the constitution that the federal government should not have this much power, because there is no level above that to regulate it. It is supposed to be like a court system, where the judge is like the federal government, it is supposed to enforce the law when the states get out of hand, or overstep their jurisdiction. And uphold the constitution, that's it. And the states act as the lawyers, who write new laws and regulations specific to what is best for their state. The states with the best regulations and laws will get the largest inflow of citizens and businesses, and the ones with shitty regulation will get the largest outflows. So it will bring about competition, which again ends up as self regulation. But right now, the federal government has its tentacles so deeply entrenched everywhere you go, it is a stranglehold on our progress as a society. And that stranglehold gets tighter as it feels like it is loosing control. That is a very scary place to be.


Right now I am heavily invested in precious metals, fire-arms, and long-term food storage. Commodities, guns, and agriculture are the highest performing assets at this time, when that ship changes course I will be right there along with it. But the the best thing you can do right now is invest time and resources into your community. We will have to rebuild at the local level, so the sooner all your neighbors are on board, the easier the re-building process will be IMO.