Daily Digest

Daily Digest 5/19 - Gold And The Debt Ceiling, Marcellus Drilled Fined Record 1.1M, Japan Officials Ignored Fukushima Dangers

Thursday, May 19, 2011, 10:47 AM
  • Gold And The Federal Debt
  • Selling Gold at Fort Knox Emerges as Next Big Question in Debate on Federal Debt Limit
  • You Cannot Have Capitalism Without Failure
  • Which Way Wednesday - Probably Down
  • Marcellus Driller Fined Record $1.1M
  • Peak Oil: A Chance to Change the World
  • Fukushima - One Step Forward and Four Steps Back as Each Unit Challenged by New Problems
  • Japanese Officials Ignored or Concealed Dangers

Our 'What Should I Do?' guide has steps to cook, see & stay warm in times of power outage

Economy

Gold And The Federal Debt (woodman)

The U.S. hit its debt limit Monday. As debate continues over whether or not to raise that limit, a variety of proposals and trade-offs are on the table. A small group of economists have suggested selling off U.S. gold assets as one way to lower the debt. Gold prices are at near record highs—around $1500 an ounce. For the U.S., that could mean billions of dollars in bullion. Most economists and lawmakers don’t expect the idea to go forward. But the prospect of making money by selling gold intrigues people. Even those with a small amount of gold jewelry or coins. The rising price of gold and how it could impact the budget debate.

Selling Gold at Fort Knox Emerges as Next Big Question in Debate on Federal Debt Limit (Dana T.)

The report did not mention the possibility of selling the government’s holdings of bullion, though the 261.5 million ounces of gold the Treasury Department lists in its reserve position would, at a recent price of $1,492 an ounce, would theoretically fetch $390.2 billion. The Wall Street Journal reported Monday that a group of Republican congressmen supports the idea of selling gold.

You Cannot Have Capitalism Without Failure (Jaime L.)

Jim Rogers, when he made that statement, was referring to the lunacy of using public money to preserve failed private enterprise in a “capitalist” economy. That is what we did, after all. We saved failed institutions, failed individuals, and failed thinking. That is wrong on many levels. But we went a step further: we saved dishonesty, criminality, and corruption. That is a far more serious proposition.

Which Way Wednesday - Probably Down (Ilene)

It's very easy to shove the markets around after hours and in pre-market but it's very expensive to do so once the bell rings and the Fed is stingy today and tomorrow with the POMO, with just $2.5Bn scheduled to be handed out to the Banksters each day - barely enough for Lloyd to tank up the limo! Friday they make up for it with $8Bn and then next week it's 8+7+6+7 = $28Bn into the holiday and another $18.5Bn even on the short week following.

Energy

Marcellus Driller Fined Record $1.1M (June C.)

Under a consent order, Chesapeake will pay $900,000 for contaminating private water supplies in Bradford County. Under a second agreement, Chesapeake will pay $188,000 for a Feb. 23 tank fire at its drilling site in Avella, Washington County.

Chesapeake is the largest operator working in Pennsylvania's Marcellus Shale, a gas-rich formation that has triggered a bonanza of drilling activity in the last three years.

Peak Oil: A Chance to Change the World (kelvinator)

For advice about life after graduation, students at Worcester Polytechnic wanted to hear from peak oil scholar Richard Heinberg instead of Exxon's CEO. Here's what he told them.

Fukushima - One Step Forward and Four Steps Back as Each Unit Challenged by New Problems (Stan G.)

Extremely important video by Arnie Gunderson. Explains what's really going on at Fukushima with the core meltdowns.

Japanese Officials Ignored or Concealed Dangers (jdargis)

The lawsuits reveal a disturbing pattern in which operators underestimated or hid seismic dangers to avoid costly upgrades and keep operating. And the fact that virtually all these suits were unsuccessful reinforces the widespread belief in Japan that a culture of collusion supporting nuclear power, including the government, nuclear regulators and plant operators, extends to the courts as well.

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."

17 Comments

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
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Posts: 4163
Spain Sells Less Than Top Target of Bonds as Demand Falls

"May 19 (Bloomberg) -- Spain sold 3.2 billion euros ($4.6 billion) of 10-year and 30-year bonds, less than the maximum target as demand declined.

The Treasury in Madrid said it sold 2.5 billion euros of 10-year bonds at an average yield of 5.395 percent, compared with 5.472 percent last time the securities were auctioned on April 20, and 5.359 percent on the secondary market yesterday. It also sold 724 million euros of 30-year debt at an average yield of 6.002 percent, compared with 5.875 percent at the last auction in March."

"Japan has slumped into recession after the earthquake and tsunami.

Its economy shrank at an annual rate of 3.7 per cent in the first quarter of the year, the second consecutive quarterly fall.

And the three months to June are likely to be worse."

  • Other news and headlines:

Goldman Cuts Its Dollar Forecasts To Reflect Fiscal Woes

ECB May Not Accept Greek Debt if Maturities Extended, FTD Says

Fed's Bullard Says U.S. Must Fix Deficit Before Crisis Strikes

Portugal opposition says no need for restructuring talk

School Board OKs budget with at least 1834 layoffs (Clark County, Nevada)

NY courts order 367 layoffs in budget cuts

UCSC Budget Cuts Called “Grim,” “Devastating”

Six Danish banks downgraded by Moody's

CMBS delinquency rate climbs to 9.22% in April: Moody's

Belarus needs $8-billion loan from IMF, economist says

Biggest-ever deficit for NZ

Gold Demand Advances 11% in Quarter as Investment Drives Prices to Record

Philly Fed business index sinks to 3.9 in May

Existing-Home Sales in US Unexpectedly Fall‎

Tommygun's picture
Tommygun
Status: Bronze Member (Offline)
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Posts: 65
Gov't selling Gold ? !

    First, thanks to Woodman and Dana T. for posting the articles in the Daily Digest about the possibility of the Gov't selling their Gold bullion assets. Though it will not come to pass I think, just the idea that we have political leaders who think of selling off items to stay afloat with the Federal Budget is assinine. (I won't call them morons, lesson learned from past Martenson alumni !)

You and I would think that once the debt ceiling is reached (already done) that cutbacks in spending and budget corrections would be made.But no.....some of these politicians want to sell our nations gold, mineral rights, land and whatever to foreign nations simply because we cannot control our spending as a nation. Our government needs a pawn shop loan. That's getting down there.

The time for austerity is now. Instead of most of the congressman( and women) being lawyers and getting voted into congress...politicians should have to be retail merchants like I have done for 22 years and then they would be qualified to run a successful government operation.  Balance the budget or they are out !! That's my 2 cents for today. I'm done.

truenorth's picture
truenorth
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truenorth's picture
truenorth
Status: Member (Offline)
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Posts: 21
Canada Pension Plan

Microsoft Buys Skype

Well lookie here.  Unlike the defrauded American social security system that has a portfolio of useless treasury notes, the Canadian Pension Plan has an Investment Board (CPPIB) and it makes investments all over the world.  Seems that they made a ton on Microsoft's purchase of Skype.

And a lot of other money in 2010.

..

Damnthematrix's picture
Damnthematrix
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Posts: 3998
Soros Sells Most of Gold ETP Holdings
What Bloomberg would never dream of saying, even though it screams out from this story,
is that the gold ETF market is a paper market, in which “ETPs trade on exchanges with each share representing metal held in a vault” is actually untrue, (it’s a scam based on the same principle as fractional reserve banking)
and will cause a market meltdown if everyone wants to take delivery at the same time.
 
Soros has instead switched to gold mining stocks, where the real metal is.

 
 

Soros Sells Most of Gold ETP Holdings During First Quarter


By Nicholas Larkin and Pham-Duy Nguyen - May 17, 2011 9:06 AM GMT+1000

 
Billionaire investor George Soros sold most of his holdings in the bullion-backed SPDR Gold Trust and iShares Gold Trust (IAU) funds in the first quarter and bought shares of mining companies Goldcorp Inc. and Freeport-McMoRan Copper & Gold Inc. (FCX), a government filing shows.

Soros Fund Management LLC held 49,400 shares of SPDR Gold Trust as of March 31, compared with 4.721 million at the end of the fourth quarter, the filing today with the U.S. Securities and Exchange Commission showed. The New York-based fund sold all 5 million shares it held in iShares Gold Trust. Soros bought 301,300 shares of Freeport-McMoRan and 7,600 shares of Goldcorp.

TD's picture
TD
Status: Bronze Member (Offline)
Joined: Jun 7 2009
Posts: 51
We are past the point where

We are past the point where austerity would work. We are beyond bankrupt. We owe more than we can ever repay. Spend the funny money as long as someone else will accept it, and prepare for the day that the system will be rebooted.

TD

maceves's picture
maceves
Status: Gold Member (Offline)
Joined: Aug 23 2010
Posts: 281
sell the gold?

I am a little confused here regarding selling the gold reserves.

Is it 

A--wow! gold has gone up to 1500 / oz--we could pay off the debt with that?  who needs gold anyway? Isn't that a thing of the past?

or

B--If the rest of the world decides to move away from dollar fiat currency to a basket of currencies tied to gold, then we need gold to back our own currency, right?

or 

C--if we don't sell something we are going under.  Sell the national parks, sell federal properties, sell the gold, sell it all!?

What's to keep big money or foreign interests from snatching it all up?

And we just sit around like the fatsos on WALL-E and just watch it all go?

----

What am I missing here?

 

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
You're Not Missing Anything About The Fleecing Of America
maceves wrote:

I am a little confused here regarding selling the gold reserves.

Is it 

A--wow! gold has gone up to 1500 / oz--we could pay off the debt with that?  who needs gold anyway? Isn't that a thing of the past?

We can't even pay 1/4th of the current year's deficit with the amount of gold the government officially holds in storage. At today's prices, the government might get $400 billion from sale of gold versus the $1.7 trillion deficit for this year. Sure some of the Republicans in Congress want to sell it, but selling it all at once would do two things:

1. Push down the price of gold with the sudden influx, thus providing Uncle Sam less money for the gold sold (maybe only $200 billion instead of close to $400 billion), and

2. Allow them and their friends to buy it cheaper. With gold around $1,500 per ounce, wouldn't be awesome to be able to buy it at a much lower price due to a temporary glut in the market?

Gordon Brown sold much of the U.K. government's gold when it was around $300 per ounce. Lots of Brits are pissed about that.

maceves wrote:

or

B--If the rest of the world decides to move away from dollar fiat currency to a basket of currencies tied to gold, then we need gold to back our own currency, right?

That sounds more plausible to me. If the government wants to be able to start over again with a new, somewhat more reputable currency in the aftermath of a collapse, it better have SOME gold lying around to back it.

maceves wrote:

or 

C--if we don't sell something we are going under.  Sell the national parks, sell federal properties, sell the gold, sell it all!?

Selling some or most won't stop the inevitable train wreck. Not enough assets to cover the deficit and selling everything means flooding the market (even now the government is trying to sell unused buildings in a real estate downturn). At the same time, even during good times, the government always gets the worst prices for things it sells (natural resource royalties, frequency spectrum auctions to telecom corporations, etc.).

Might even hasten the train wreck by reducing the government to having fewer assets to rebuild with in the aftermath of a collapse. But the excuses being bandied around might be used to enrich the pockets of the well-connected - much like the chaos surrounding Russia's collapse allowed the well-connected oligarchs to buy state-owned companies at bargain-basement prices from the state, and become billionaires.

maceves wrote:

What's to keep big money or foreign interests from snatching it all up?

Ordinary people. But there is little hope because so many politicians and their aides and lobbyists and corporations and foreign interests like to insert little things into legislation in the dark of night, or arrange special sales and deals.

maceves wrote:

And we just sit around like the fatsos on WALL-E and just watch it all go?

Are you gonna sit around and let it happen?

maceves wrote:

What am I missing here?

I don't think you're missing anything.

Poet

plato1965's picture
plato1965
Status: Platinum Member (Offline)
Joined: Feb 18 2009
Posts: 615
teh onion

 

 http://www.youtube.com/watch?v=6JPcimrnXGA

 

 but when you have a printing press.. why bother !

 http://www.youtube.com/watch?v=GWXDjiKVs2U

 

 actually.. to go a bit greenspan/fofoa/bix weir... it would redistribute power back to the people.

 who has the gold makes the rules. If the people have the gold......

 

 

 

maceves's picture
maceves
Status: Gold Member (Offline)
Joined: Aug 23 2010
Posts: 281
fatso here

Poet, being right doesn't always make you feel good.

OK---if I were to get up and try to do something, what would it be?

I can't  afford to buy up gold myself.  I absolutely love the national parks, but I can't afford to buy one.

My wobbly legs are------oooops!

Is there a way to be proactive, or is it just too late?

Where is WALL-E when you need himn?

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
Maybe There Is Hope For WALL-E World
maceves wrote:

Poet, being right doesn't always make you feel good.

OK---if I were to get up and try to do something, what would it be?

I can't  afford to buy up gold myself.  I absolutely love the national parks, but I can't afford to buy one.

My wobbly legs are------oooops!

Is there a way to be proactive, or is it just too late?

Where is WALL-E when you need himn?

I think that, unlke in the former Soviet Union, we still have certain (though dwindling) freedoms in this country. We still have some good journalists. Civic-minded, patriotic people. Hopefully that'll be enough to make a difference in the coming years.

Though dwindling, our middle class produces a lot of idealistic young activists who want to help preserve the environment, be inspired to work for change, preservation of our freedoms, etc. While many may be jaded or apathetic already, some will be galvanized into action. And maybe, just maybe, when people have little left to lose, they'll fight harder and tougher.

I think there are lots of ways to be proactive. I bet you are already active, turning fat into soap. You have to be the WALL-E you are looking for... :)

Poet

Woodman's picture
Woodman
Status: Diamond Member (Offline)
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Posts: 1028
Peak oil and oil companies

"For advice about life after graduation, students at Worcester Polytechnic wanted to hear from peak oil scholar Richard Heinberg instead of Exxon's CEO. Here's what he told them."

That's encouraging some in the upcoming generation has some awareness. Can only hope Exxon will learn from that and become more open about Peak Oil issues like Shell Oil has.
http://www.shell.com/home/content/aboutshell/our_strategy/shell_global_s...

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Oh well (Golden Bling.)

So Ben prints a lot of paper and gives it to the banks.

The banks swap the paper for USA's bling. USA gets to hold the bag of paper.

That'll work.

Note to self: Save paper for payday.

Nice little piece on energy for the less anal retentive.

Currently, there is a non-0% contribution from LENR reactors to global primary energy supply, for somewhere in the world, there are purportedly 97 Energy Catalyzers steaming forth, and there are many more labs around the globe testing LENR reactors of their own

http://coldfusionnow.wordpress.com/2011/05/18/i-want-to-believe/

.

nigel's picture
nigel
Status: Silver Member (Offline)
Joined: Apr 15 2009
Posts: 146
Gold in Fort Knox

http://www.timesonline.co.uk/tol/news/world/us_and_americas/article5989271.ece

Selling off the gold in fort knox assumes that the gold is still there, pay attention to the bit in the article that says the fed has not flooded the market with fort knox gold in order to lower the gold price in the last decade, does that mean they did it in the 1990's and the 1980's?

If the gold really is an asset of the fed, then would anyone be surprised if the gold may not actually be there.

I guess that this could be another internet conspiracy theory. It would be nice to get someone to audit the gold.

guardia's picture
guardia
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Posts: 592
Cold Fusion @ The Oil Drum (Re: Oh well (Golden Bling.))
Arthur Robey wrote:

Nice little piece on energy for the less anal retentive.

Currently, there is a non-0% contribution from LENR reactors to global primary energy supply, for somewhere in the world, there are purportedly 97 Energy Catalyzers steaming forth, and there are many more labs around the globe testing LENR reactors of their own

http://coldfusionnow.wordpress.com/2011/05/18/i-want-to-believe/

Oh look at the headline of The Oil Drum today: The return of cold fusion?

That MUST make you feel all fuzzy inside, Arthur Wink

Samuel

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
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Posts: 3936
Chemically aided nuclear reactions.

Thanks Guardia.

That felt better than winning the state lottery.

The oil drum is not totaly convinced yet, but they will get there. 

I recommended they read Nuclear Transmutations. The Reality of Cold Fusion by Dr. Tadahiko Mizuno.

This was written before Rossi, and is not commercialy orientated but is all about science.

 

 

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
Juicy scandal.

 Take time to read this bit of wickedness and rough play.

Post on Max Keiser  http://rt.com/programs/keiser-report/episode-148-financial-max/

A great deal of the evidence submitted to the Senate Banking Committee, as well

as New York state prosecutors, was supplied to them by none other than the

current President of the International Monetary Fund and soon to be French

Presidential candidate, Dominique Strauss-Kahn.

What is also interesting about these events surrounding Strauss-Kahn is that for

whatever reason Strauss-Kahn's diplomatic immunity was revoked by the U.S. State

Department 24 hours BEFORE the alleged sexual incident occurred at the Sofitel

hotel.

The U.S. Secretary of State, of course, is none other than Hillary Rodham

Clinton, who is now a subject of the aforementioned investigation triggered by

evidence given to Federal and State prosecutors by none other than Strauss-Kahn.

 Greece and Ireland do not want a 'bailout' from the International Monetary Fund

(IMF) knowing this bailout would do nothing other than pay off the derivative

holdings of Goldman Sachs and J. P. Morgan, which are on the books of these noted

European nation members.

This is the evidence that has been supplied to both European and U.S. financial

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