Daily Digest

Daily Digest 3/28 - 12 Signs Of Hyperinflation, First Signs Of A Parabolic Silver Spike, Water Shortages Hit Kuwait

Monday, March 28, 2011, 9:47 AM
  • It's 2026, And The Debt Is Due
  • 12 Warning Signs Of Hyperinflation
  • Gold Prices To Rise With EU Quantitative Easing
  • First signs of a parabolic spike for silver
  • Qatar Seizes Iranian Weapons Ships On Way To Bahrain
  • Qatar Denies Seizing Iran Ships Carrying Weapons 
  • In Deference to Crisis, a New Obsession Sweeps Japan: Self-Restraint
  • Rising Oil Prices Loom Over Future Of Delivery Giant UPS
  • Where Cities Are Taking Us: 10 Urban Eco-Trends
  • Water Shortages Hit Kuwait

Learn how to protect your wealth against the Three E forces using our 'What Should I Do?' guide


It's 2026, And The Debt Is Due (David B., SolidSwede)

he seeds of this crisis were planted long ago, by previous generations. Our parents and grandparents had noble aims. They saw poverty among the elderly and created Social Security. They saw sickness and created Medicare and Medicaid. They saw Americans struggle to afford health insurance and embraced health care reform with subsidies for middle-class families.

But this expansion in government did not come cheap. Government spending has taken up an increasing share of our national income.

12 Warning Signs Of Hyperinflation (Alfredo E.)

In our estimation, the most likely time frame for a full-fledged outbreak of hyperinflation is between the years 2013 and 2015. Americans who wait until 2013 to prepare, will most likely see the majority of their purchasing power wiped out. It is essential that all Americans begin preparing for hyperinflation immediately.

Gold Prices To Rise With EU Quantitative Easing (Alfredo E.)

Though it is never openly stated, this fund will also be supplemented by quantitative easing (QE) on the part of the European Central Bank and national central banks in Eurozone countries. Earlier this year, for example, the Irish central bank printed 51bn euros out of thin air with the ECB’s blessing. This is equivalent to 25% of Ireland’s GDP.

First signs of a parabolic spike for silver (Alfredo E.)

It is silver that has the most exciting price trend developing. Of course this carries a huge red warning for volatility. This is not a straight line movement. The ups and downs can and no doubt will be formidable. Silver crashed 52 per cent in late 2008 below $10 but then bounced back magnificently.

Qatar Seizes Iranian Weapons Ships On Way To Bahrain

Qatar has seized two Iranian boats in the Gulf carrying weapons, a Kuwaiti electronic newspaper reported on Sunday. The boats were intercepted off Al-Zubara coast, northeast of Qatar and close to the country’s territorial waters with Bahrain, Al-Aan said.

Qatar Denies Seizing Iran Ships Carrying Weapons (pinecarr)

Qatar has denied media reports that it seized two Iranian ships carrying weapons through the Gulf, the emirate’s state news agency said Monday.

In Deference to Crisis, a New Obsession Sweeps Japan: Self-Restraint (jdargis)

“At this time of the year, we’d usually be talking about going to see cherry blossoms,” Hiroshi Sekiguchi, one of the country’s best-known television personalities, said on his Sunday morning talk show.

In fact, cherry blossom viewing parties and fireworks festivals have been canceled. Graduations and commencements have been put off. Stores and restaurants have reduced their hours or closed. Cosmetics and karaoke are out; bottled water and Geiger counters are in.


Rising Oil Prices Loom Over Future Of Delivery Giant UPS (pinecarr)

Scott Davis, the chief executive of UPS, says the company is currently examining what the world would look like with oil at $200 a barrel.


Where Cities Are Taking Us: 10 Urban Eco-Trends (David B.)

Bees are on the wane, and we have no idea why. Entire populations are dying or disappearing as part of the baffling phenomenon known as Colony Collapse Disorder. Bad news in itself, but the sting in the tale is that without bees, many of our staple crops are doomed. While scientists search for the answers, the urban backyard remedy is obvious – and here’s how it works. Bee hives only need a little land to thrive – and you’d be following in the footsteps of committed enthusiasts like Scarlett Johansson and Samuel L Jackson. Further incentive needed? One word: honey.

Water Shortages Hit Kuwait (pinecarr)

In the face of assurances by officials at the Ministry of Electricity and Water in the last two days that the country is far from water crises, situation on the ground reveals otherwise after various areas experienced serious water shortages.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."


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'Cheap' Bread to Cost

'Cheap' Bread to Cost Billions in New Egypt

"Political change may be remaking Egypt, but "we trust in God that the bread's going to stay cheap," said Shadia Abdul Halim, 45, a mother of six patiently queued up to buy.

Bread has stayed cheap even as Egypt's other food prices leaped upward by 17 percent last year — cheap because the government pays for most of it.

Twenty of the flat, round pieces of local "eish" — "life" in Arabic, the word Egyptians use for the staple — cost just one Egyptian pound. That's the equivalent of 17 U.S. cents for more than 2 kilograms (more than 5 pounds) of bread.

But halfway around the world on this day, on a Chicago trading floor, the price of wheat edged up again, raising the pressure another notch on poorer states like Egypt that have made subsidized bread a fixture of Arab life, an increasingly unaffordable one.

The Middle East's bread subsidies are just one dilemma in a world facing a potential food crisis this year, like the troubles in 2008, when skyrocketing prices touched off riots in developing countries.

The U.N. global food price index hit a record high in February, surpassing even 2008's peak. The average price of wheat so far this year, $346 a ton, is more than double 2005's price. The reasons for the increases are various — growing demand, impact of higher oil prices, diversion of corn to ethanol. Drought and floods have cut into wheat production, possibly previewing what some analysts say will be growing global grain shortages. .........."


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Housing market: 13% of all U.S. homes are vacant

"High residential vacancies are killing many housing markets, as foreclosed homes sit on the market and depress sale prices and property values.

And it's only getting worse: The national vacancy rate crept up to just over 13% according to last week's decennial census report. That's up from 12.1% in 2007.

"More vacant homes equal more downward pressure on home prices," said Brad Hunter, chief economist for Metrostudy, a real estate information provider."

  • Other headlines: 


Yuan Falls Most in Five Weeks on Calls for US to End Purchases

Fed Should Consider Curtailing Stimulus Program, Bullard Says

Ireland Seeks to Force Losses on Banks' Senior Bondholders

Illinois makes little progress on repaying unemployment loan

California cities, counties face bigger pension bill

S&P warns of further Portuguese ratings downgrade

S&P Downgrades Five Portuguese Banks

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NIA a scam?

Regarding the "12 Warning Signs of Hyperinflation" article, I've read that the National Inflation Association is a scam. Has anyone else read this? Any thoughts?

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NIA: Hyperinflation or just hype
Josey wrote:

Regarding the "12 Warning Signs of Hyperinflation" article, I've read that the National Inflation Association is a scam. Has anyone else read this? Any thoughts?

I don't beleive it's a scam because as far as I know they don't sell anything. However, the information they provide is packaged in a dubious way and I find it of marginal utility. Just my opinion.

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NIA press release

I read their news release and was underwhelmed by the lack of specifics and citations and the over-broad statements. I'm used to Chris doing a much more thorough job of backing up his conclusions and hypothesis with hard numbers and links. The fact that they're putting this out on PR Newswire caught my eye. It's an electronic news release. Very PR firm, which lowers the credibility a bit for me.  From what I've read, NIA is the work of a stock analyst making his case hyperinflation is coming and making investment recommendations based on that.

That said, the general content and thrust of the article seems reasonable to me, but I don't see any support for their timing predictions in what they wrote. It's too vague.

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Josey wrote:I've read that
Josey wrote:

I've read that the National Inflation Association is a scam. Has anyone else read this? Any thoughts?

I have read comments about them being a scam, but they most of them come from groups like "media matters" whom I consider a far left propaganda wing...  At any rate, their message seems to match much of what Dr. M has said as well as others like Peter Schiff and Ron Paul.  I find the NIA's stuff a bit hyped, but given the road we are on I'm not sure it's not valid and good at waking people up.

I think you have to ask yourself, how can it be a scam?  Is it simply a front to encourage people to buy gold and silver?  Do you believe what they say is accurate?  Is it any more of a scam than those trying to convince you that everything is fine, just buy some more GE stock and a new big house, and a new big car?  Is it a scam only becuase it presents a message opposite much of the MSM? :-)

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NIA a scam?

I've followed them for quite a while and would not characterize them as a scam. We're all having to guess a bit at this point, so they may or may not have guessed right, time will tell. They do produce some good videos that assist in waking up the uninformed.

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"A week to ten days"

Interesting 5-minute dramatization of a sudden (and plausible) disruption of oil supplies followed by a 5-minute interview with former Shell CEO John Hoffmeister.  The dramatization starts at 25:45.


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Why The European Union Is Doomed

Posted over at zerohedge: 

Why The European Union Is Doomed


A general discussion of the problems faced and their causes.

".......... Credit at very low rates of interest is treated as “free money,” for that’s what it is in essence. Recipients of free money quickly become dependent on that flow of credit to pay their expenses, which magically rise in tandem with the access to free money. Thus when access to free money is suddenly withdrawn, the recipient experiences the same painful withdrawal symptoms as a drug addict who goes cold turkey.

Even worse--if that is possible--free money soon flows to malinvestments
as fiscally sound investments are quickly cornered by State-cartel partnerships and favored quasi-monopolies. The misallocation of capital is masked by the asset bubble which inevitably results from massive quantities of free money seeking a speculative return.

The E.U.’s implicit guarantee to mitigate any losses at the State-sanctioned large banks--the Eurozone’s equivalent of “too big to fail” banks--enabled a financial exploitation that is best understood in a neocolonial model. In effect, the big Eurozone banks “colonized” member states such as Ireland, following a blueprint similar to the one which has long been deployed in developing countries such as Thailand.

This is a colonialism based on the financialization of the smaller economies to the benefit of the big banks and their partners, the Member States governments, which realize huge increases in tax revenues as credit-based assets bubbles expand.

As with what we might call the Neoliberal Colonial Model (NCM) as practiced in the developing world, credit-poor economies are suddenly offered unlimited credit at very low or even negative interest rates. It is “an offer that’s too good to refuse” and the resultant explosion of private credit feeds what appears to be a “virtuous cycle” of rampant consumption and rapidly rising assets such as equities, land and housing. .............."

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The chief executive of

The chief executive of Caterpillar has warned the governor of Illinois that state spending and an unfavorable business climate could undermine the competitiveness of Illinois-based companies.

Doug Oberhelman
Doug Oberhelman

Doug Oberhelman sent the letter last week to Gov. Pat Quinn, noting that four states have invited the Peoria-based heavy equipment maker to relocate since Illinois raised personal and corporate income taxes in January.

"I want to stay here. But as the leader of this business, I have to do what's right for Caterpillar

[CAT.N  109.40    0.31  (+0.28%)   ]

when making decisions about where to invest," Oberhelman wrote in the letter obtained Friday by the Springfield news bureau of Lee Enterprises.

Oberhelman attached letters from the governors or other officials of Texas, Nebraska, Virginia and South Dakota, all of whom cited the recent Illinois tax hikes and offered to roll out the red carpet to Caterpillar.

Caterpillar spokesman Jim Dugan declined to provide a copy of Oberhelman's letter, but said it was not a threat to abandon Illinois — where Caterpillar employs 23,000 of its 104,000 global employees.

"The letter really wasn't about Caterpillar, but about the state of the state, and our concern about deficit spending and the need to get the state on firmer footing," Dugan said.

Dugan said Oberhelman's letter to Quinn did not specifically refer to the recent tax increases.

"It referred to the need for broader reform, and that can and should include tax structure as well as spending structure." With Illinois facing a potential $15 billion budget gap, the state legislature passed a bill in mid-January that would raise personal income taxes to 5 percent from 3 percent and the corporate tax rate to 7 percent from 4.8 percent.

The four-year tax increase was accompanied by spending limits through fiscal 2015 in the country's fifth most populous state.

green_achers's picture
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I also don't have a lot of

I also don't have a lot of use for bullish information on gold from an outfit called "goldmoney.com" and same on silver from an outfit called "silverseek.com."  Now both are viable investments, and ought to be part of anyone's strategy, but that doesn't mean it's always going to be time to invest in either.  Though you might think so from reading sources that just also happen to be selling the merchandise or advertising companies that are.

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Joe Bageant died

Just found out that Joe Bageant died.  He's relevant to the 3Es discussion mainly in the Economy portion -- as a self-described "redneck socialist" born in very rural very blue-collar America, he had a deep-held distrust of bankers and politicos and the games they play.

Mostly, I dug him because the man could write.  Kind of in the Twain mold.  Cancer took him quickly.  There's a sort of In Memoriam post at his blog:


FWIW, I really enjoyed his book "Deer Hunting With Jesus."  Plenty to chew on and plenty of laughs.

Viva -- Sager

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radiation forecasts in Japan

These forecast charts aren't looking good AT ALL


We just need a good whiff south and Tokyo is a thing of the past

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Quake causing production stoppages across the world

From Asahi news:

"The disruption to Japanese industrial production caused by the March 11 earthquake and tsunami is rippling through global supply chains, stopping production in factories across the world.

The U.S. research firm IHS Automotive released a report on Friday forecasting that cuts in Japanese carmakers' production and the failure of parts supplies from Japan would reduce global automobile production by 600,000 vehicles by the end of March.

The number of cars manufactured worldwide could drop by up to 30 percent in the two months following the quake, according to IHS.

General Motors Co., the largest U.S. automaker, shut down an assembly plant making compact pickups in Shreveport, Louisiana, on March 21 because vital parts shipments from Japan had failed to arrive.

The company also stopped some production lines and stood down 59 workers at a factory in Buffalo, New York, that supplies engines to the Louisiana plant.

GM plans to resume operations at the Shreveport factory on March 28 and recall the workers in Buffalo after sourcing the necessary supplies.

GM's Opel unit in Europe has suspended operations at plants in Spain and Germany.

GM Chief Executive Daniel Akerson said on March 19 that the disruption from the quake could affect all automakers.

Ford Motor Co. on Friday told dealers to stop taking orders for vehicles painted in "tuxedo black" because of difficulties with importing a special pigment from Japan.

PSA Peugeot Citroen, the major French automaker, said disruption to supplies of electronics parts from the Tokyo-based auto parts firm Hitachi Automotive Systems Ltd. was beginning to affect operations at its diesel engine plants in Europe. .....etc."


There are (understandable) rumors that TEPCO will be nationalized.

TEPCO faces challenge in cooling reactor

"The Nuclear and Industrial Safety Agency said on Monday that TEPCO has to strike a balance between injecting cooling water into the reactors and preventing radioactive water from seeping out.

On Monday, the power company detected radiation of more than 1,000 millisieverts per hour on the surface of puddles in the No. 2 reactor's turbine building and in a trench outside the building.

The concrete trench stretches toward the coast but does not connect to the sea.

Puddles of water were also found in the trenches of the No.1 and No.3 reactors.

The No.1 reactor's trench will overflow if the water rises by 10 centimeters. TEPCO has blocked the trench outlet with sandbags and concrete to prevent the water from reaching the ocean.

The water in the trenches of the No.2 and No.3 reactors is reportedly 1 meter from overflowing.

TEPCO said it hopes to swiftly find a way to remove the water from the trenches.

On Monday, The power company scaled back its operation to cool the No. 2 reactor, injecting 7 tons per hour, reduced from 16. The reactor's temperature rose by more than 20 degrees Celsius."



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Joe Bageant

Sager, I was a big Joe Bageant fan.  He will be missed.

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