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Daily Digest 6/26 - Gold As Zero-Risk Asset, The Great Abdication, Is 2012 The Next 2008?

Tuesday, June 26, 2012, 11:23 AM


Breaking News: Regulators to Classify Gold as Zero-Risk Asset (LogansRun)

Well, on 4th June the Federal Reserve, OCC (Office of the Comptroller of the Currency) and FDIC (Federal Deposit Insurance Corporation) collectively circulated a memo asking for comment on their proposed changes to the regulatory capital risk-weighting framework. Section 11, ‘Other Assets’, specifies that a “zero risk weight” is to be applied to “gold bullion held in the banking organization’s own vaults, or held in another depository institution’s vaults on an allocated basis…”

Three Reasons Why Silver Could Take Off in 2012 (Arthur Robey)

A quick look at the five-year silver chart shows you the kind of ups and downs the price has endured.

The Great Abdication (Ben Johnson)

Suddenly normally calm economists are talking about 1931, the year everything fell apart. It started with a banking crisis in a small European country (Austria). Austria tried to step in with a bank rescue — but the spiraling cost of the rescue put the government’s own solvency in doubt. Austria’s troubles shouldn’t have been big enough to have large effects on the world economy, but in practice they created a panic that spread around the world. Sound familiar?

New study by Harvard Kennedy School researcher forecasts sharp increase in world oil production capacity, and risk of price collapse (Ben Johnson)

Contrary to some predictions that world oil production has peaked or will soon do so, Maugeri projects that output should grow from the current 93 million barrels per day to 110 million barrels per day by 2020, the biggest jump in any decade since the 1980s. What’s more, this increase represents less than 40 percent of the new oil production under development globally: more than 60 percent of the new production will likely reach the market after 2020.

Maugeri’s analysis finds that the gross additional production from current exploration and development projects in the world could produce an additional 49 million barrels per day by 2020, an increase equivalent to more than half the world’s current 93 million bpd. After adjusting that gross output increase for political and technical risk factors as well as the offsetting depletion rates of current fields, the analysis projects the net increase by 2020 to be about 17.5 bpd.

Top secret: $80B a year for food stamps, but feds won’t reveal what’s purchased (Dana T.)

“We can’t release it based on federal rules. If it were up to us, I wouldn’t have a problem releasing the information. It’s taxpayer money,” said Tom Steinhauser with the division of benefit programs for the Virginia Department of Social Services.

Peter Schiff's Latest Advice To Investors (David B.)

In 2014, that’s the year the U.S. economy is expected to reach fresh new lows and the year politicians will finally be forced to face the tough choices regarding proposed cuts to federal, state and local government budgets, according to the three men. It will also be the year that ushers in severe social unrest, similar to what is happening in Greece, in the case of Jim Rogers’ prediction for 2014.


Is 2012 The Next 2008? (OPA)

There is seemingly plenty of oil available in the markets, which may in part explain prices. In the U.S., crude oil production is so prolific that the country lacks the infrastructure to do much with it. Globally, the Saudis may even consider constraining markets in an effort to keep oil prices under control. Much of the oil glut may be temporary protection against the series of sanctions set to go into force against Iran, however. That suggests there will likely be no major long-term impacts from the shortage of Iranian crude despite a few jitters the first week of July.


2009 swine flu outbreak was 15 times deadlier: study (VeganD)

Scientists were unsure how transmissible or deadly this mongrel flu would be, but early signs were ominous: the World Health Organization declared swine flu a pandemic in June 2009, when labs had identified cases in 74 countries.

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."


saxplayer00o1's picture
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dps's picture
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sax, you are awesome!

Thanks for all you do ... every day ... all these months and years.  ... dons

RogerA's picture
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Germany downgrade.

Egan-Jones Ratings has downgraded Germany from 'AA-' to 'A+'


eexpo's picture
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Posts: 51
urban fires

I used to here about the many nightime shootings where I live, but now I am seeing on the morning local news several fires each night as well as the shootings. I didn't pay any attention  till I read the article above about the fires in Detroit.Its all part of the predicament WE all are in....

saxplayer00o1's picture
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Visa Europe Prepares For Possible Euro Zone Breakup .

"Visa Europe is holding weekly meetings to discuss scenarios in the event the euro zone collapses, joining other companies that are preparing for a potential breakup of the currency bloc.

Chief Commercial Officer Steve Perry said Tuesday that management at the U.K.-based credit-card company meets weekly to explore various possible outcomes, including a total collapse of the euro zone. "

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Ditto to Sax, I read

Ditto to Sax, I read everything you gives us. Sooooo much appreciated.

Go Tigers


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