Daily Digest

Daily Digest 5/1 - Be Careful Wishing For The Fed's End, Qaddafi Calls For Cease-Fire Talks, Deflation Or Hyperinflation?

Sunday, May 1, 2011, 10:49 AM
  • TIC – China’s Decreasing its Holdings 
  • Be Careful Wishing for the Fed’s End
  • Treasury and Fed Put Out Cash, Raising Fist Pumping Crowd for Ben
  • Doug Casey: Precious Metals Vs. The USD
  • Deflation or Hyperinflation?
  • Qaddafi Calls for Cease-Fire Talks
  • China’s Manufacturing Grows at Slower Pace, Survey Shows
  • TEPCO’s Updated Radiation Map

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Economy

TIC – China’s Decreasing its Holdings (pinecarr)

Of course the biggest holder is the Fed.

Be Careful Wishing for the Fed’s End (jdargis)

“Money,” observes the Fed historian Allan H. Meltzer, “does not take care of itself.” But who else could regulate the value of money? And regulate its value in relation to what?

Treasury and Fed Put Out Cash, Raising Fist Pumping Crowd for Ben (Ilene)

It can’t be Japan and probably isn’t China, which has its own problems, so by process of elimination, the only ones with that kind of cash are the oil producing nations. That game can only go on as long as the Fed keeps pumping up the price of gas. It’s a market double whammy. What happens after June? Poof! It’s gone. But until then, the potential for this light show to go ballistic should not be discounted.

Doug Casey: Precious Metals Vs. The USD (pinecarr)

What we're facing now is something of absolutely historic importance – the biggest thing that's gone on in the world since the Industrial Revolution.

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Deflation or Hyperinflation? (kelvinator)

What is a deflationist? It is one who looks very closely at the present structure of everything, the laws, the rules, the regulations, what is supposed to happen, who should fail, etc… but ignores the political (collective) will that backs it all up. The same political will that always changes the rules to suit its needs as surely as the sun rises. And it is this political will that makes dollar hyperinflation a certainty this time around.

Qaddafi Calls for Cease-Fire Talks (jdargis)

The strike would be a significant blow to the morale of the regime, which is struggling to maintain its hold on the western half of the country despite weeks of NATO-led airstrikes. It came just hours after Gadhafi called for a mutual cease-fire and negotiations with NATO powers to end a six-week bombing campaign.

China’s Manufacturing Grows at Slower Pace, Survey Shows (jdargis)

China’s economic expansion, a driver of global growth, may moderate as the government counters the fastest inflation since 2008 and cools a real-estate market that has been at risk of price bubbles. Credit Suisse Group AG says a fifth increase in benchmark interest rates since the global financial crisis may come as early as tomorrow, a Chinese holiday, less than a month after the previous move.

Environment

TEPCO’s Updated Radiation Map (jdargis)

While the radiation levels at some hot spots have declined since the first map was made on April 23rd, others have remained the same or increased.

The increases are likely due to movement of already contaminated materials rather than to new leaks.

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15 Comments

Arthur Robey's picture
Arthur Robey
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Posts: 3936
  Be Careful Wishing for

 

Be Careful Wishing for the Fed’s End

I wonder if the author of this piece, Mr. Lowenstein, has anything that he would like to share with us.

Disclosures perhaps?

VeganDB12's picture
VeganDB12
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Posts: 740
Arnie Gunderson 4/26/11 Reactor 3 "prompt criticality"

http://vimeo.com/22865967

Not a lot of new info, just seems to confirm previous suspicions that the Reactor 3 explosion may have been a nuclear explosion (on a small scale so to speak)

mono's picture
mono
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Be Careful Wishing for the Fed’s End

What´s the difference between Tammany Hall and Washington, apart from the size?

es2's picture
es2
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Posts: 68
It looks like The Billion

It looks like The Billion Prices Project @ MIT brought back the USA inflation index? http://bpp.mit.edu/usa/daily-price-indexes/?country=USA

Richard Russell - China on Massive Gold Accumulation Program http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2011/4/30_Ri...
Against it's huge ($3 trillion) reserves, only 1.7% of China's reserves are in gold. China is on a diversification program to increase its tiny reserves of gold. It is thought that China wants at least 10% of its reserves in gold. This means that China is on a massive gold accumulation program.

Weekend Funnies: http://economicedge.blogspot.com/2011/04/weekend-funnies_30.html

Grover's picture
Grover
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Posts: 840
Money's value
Arthur Robey wrote:

Be Careful Wishing for the Fed’s End

I wonder if the author of this piece, Mr. Lowenstein, has anything that he would like to share with us.

Disclosures perhaps?

I just read that article for the second time. The author's approach is similar (and as frustrating) as an old coworker of mine who couldn't make a decision and always tried to complicate matters to justify his stance. My coworker would start out agreeing with whatever your point was and then start beating around the bush until the bush was beat out of existence. At the end, he would argue for continuance of the current process to devine the appropriate course of action.

Money is a purely human concept. Animals barter to some extent, but I'm not aware of any that store worthless trinkets in hopes of using those baubles for trading in the future. The amount of money doesn't matter as much as the relative amount of money that a person has. If you are a billionaire and it costs a few million for a cup of coffee, you aren't rich. It doesn't really matter if the units are dollars, euro, yen, or measures of gold.

Whoever regulates the amount of money in a system has incredible power. Power corrupts. Why not let the market determine money's value?

Grover

SteveW's picture
SteveW
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Posts: 490
What is money?
Arthur Robey wrote:

 

Be Careful Wishing for the Fed’s End

I wonder if the author of this piece, Mr. Lowenstein, has anything that he would like to share with us.

Disclosures perhaps?

His hstorical reference of multiple circulating US banknotes reminded me of the current situation with Scottish banknotes,

Quote:

These are the recognised currency in Scotland, and although they are not legal tender they are always accepted by traders in Scotland, and often in other parts of the United Kingdom. However, some people outside Scotland are unfamiliar with the notes and they are sometimes refused.[15] Institutions such as clearing banks, building societies and the Post Office will readily accept Scottish bank notes. Branches of the Scottish note-issuing banks situated in England dispense Bank of England notes and may not dispense their own notes from those branches.[16] Modern Scottish banknotes are denominated in pounds sterling, and are exactly the same value as Bank of England notes;

http://en.wikipedia.org/wiki/Banknotes_of_the_pound_sterling

which I contrast with the prosecution Bernard von NotHaus who produced non legal tender from precious metal.

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
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Posts: 4145
Big drop in silver prices

spot silver

 

CME raised margins :

Link 1

Link 2

 

plato1965's picture
plato1965
Status: Platinum Member (Offline)
Joined: Feb 18 2009
Posts: 615
10% drop

 

 10% in a few minutes.. *wow*

 If only I knew how to buy put options... but.. since I don't.

 Fairly confident of the long term... nice dip to buy more, may get even nicer.

 More interested in what it *means*...  2008 redux ?

 

 

 

TechGuy's picture
TechGuy
Status: Gold Member (Offline)
Joined: Oct 13 2008
Posts: 415
Be Careful Wishing for the

Be Careful Wishing for the Fed’s End

I didn't read the article, but there is perhaps one reason why ending the Fed would be bad, That is something much worse could replace it!  Such as giving Congress or a Congressional committee to control the money supply and set interest rates. I doubt very much except for a very small number of people in Washington would support return of the gold standard for the dollar. It would take away their punch bowl. I expect the few political leaders that are actively discussing removing the Fed and abandoning fiat currency will either  go away or disappear, one way or another as the majority on control that don't want this go mainstream choose to take nefarious actions.

FWIW: All this discussion on Dollar Policy change is pretty much a waste of time. Its not going to happen. Best to follow Chris plan to distance oneself way from dependancy on US currency and the economy as we currently know it.  Self reliance is really the only option at this point. Staying below the radar is the smart choice. NotHaus may have been the first go go down, but he certainly won't be that last. Don't paint a big target on yourself.

One last note, QE2 might end, but interest rates aren't going to move up. The Fed will find ways to to keep a lid on rates and continue to put pressure on the dollar. There is simply no way the US gov't can fund its debt and its deficit spending without the Fed printing. Without the Fed US treasuries would crash causing double digit rates and force the gov't in a hard default, unable to pay its liabilties.  Which foriegn nations would lend enough money to support the US? Europe with Greece, Portugal, Spain, and Ireland already technically bankrupt? Japan, just barely beginning its recovery from its huge natural (and man made nuclear disaster)? India or China? Perhaps Russia, Mexico, Venezuela? Virtually all nations are facing finance difficults and do not have the spare capital to go on buying US treasuries. QE\QE-lite\QE2 wasn't really about keeping interest rates low, its about keeping the lights on in downtown Washington.

Best of luck to you all!

 

 

 

Jager06's picture
Jager06
Status: Gold Member (Offline)
Joined: Dec 2 2009
Posts: 395
bin Laden

If bin Laden is dead, start watching for dirty nukes and their bigger brothers to pop off.

I know wikileaks supposedly had a bit of a story, there is more than that though.

You can take my .02 to the bank.

Don't forget to Buy The Freaking Dip!

Best Wishes,

Jager06

doorwarrior's picture
doorwarrior
Status: Silver Member (Offline)
Joined: Oct 13 2009
Posts: 166
Fairly confident of the long

Fairly confident of the long term... nice dip to buy more, may get even nicer.

I don't think it will stay this low until NY opens in the morning. It will back up to $47 by the time NY opens. Then it will get pushed down again at 10am.

Rich

idoctor's picture
idoctor
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Posts: 1731
BREAKING NEWS Osama Bin

BREAKING NEWS
Osama Bin Laden is Dead According to U.S. Officials; President Obama to Speak Shortly (Story Developing)
es2's picture
es2
Status: Bronze Member (Offline)
Joined: Dec 31 2010
Posts: 68
Spain's jobless rate tops 21% as all major sectors lose jobs

Spain's jobless rate tops 21% as all major sectors lose jobs

Spain's unemployment rate rose nearly a point to 21.29%, with 4.9 million jobless for the first quarter of 2011, the government reported Friday, as the prolonged economic crisis continues to squeeze the nation.

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Silvers drop

Plato said.( about silver's plunge.)

More interested in what it *means*...  2008 redux ?

Has it got anything to do with Bin Laden's death? The silver market must be twitchy. And then they came to their senses.

My prediction is for a bigger plunge if the Fed manages to get off drugs.

(eerm. Mabey not.)

 

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Prof Hawkins agrees with

Prof Hawkins agrees with Chris about the implications of the exponential function at 6min 40sec of this ted talk.

http://www.ted.com/talks/stephen_hawking_asks_big_questions_about_the_un...

He also commands us to colonise space. No excuses.

Here is how we will do it.

http://22passi.blogspot.com/2011/04/sergio-focardi-father-of-ni-h-cold.html

We will use cold fusion to make hydrogen/oxygen rocket on a magnificent scale.

We will extend the work of Gerard K O'Neil.

http://en.wikipedia.org/wiki/Gerard_K._O'Neill .

We will start with L1 and L2.

 http://en.wikipedia.org/wiki/The_High_Frontier

Any failure will lead to our extinction.

Professor James Lovelock.

http://www.ecolo.org/lovelock/

Lovelock: 'We can't save the planet'

Professor James Lovelock, the scientist who developed Gaia theory, has said it is too late to try and save the planet.

 http://news.bbc.co.uk/today/hi/today/newsid_8594000/8594561.stm

 

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