Daily Digest

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Daily Digest 8/13 - Zimbabwe Adopts Yuan, Thinking Outside the Commodity Box

Thursday, August 13, 2015, 8:38 AM


Robert Kiyosaki & Bert Dohmen: Today’s economic threats and why everyone is ignoring them (Herman J.)

Think Apple is stock market gold? Think China is the new economic superpower? You thought wrong. In the years since losing Steve Jobs, Apple has failed to innovate while engaging in unparalleled corporate arrogance. China meanwhile is leveraged to the hilt at the same time their government is criminalizing liquidation. Today Robert and Kim talk with Bert Dohmen about these economic threats and why everyone is ignoring them.

Thinking Outside the Commodity Box: An Investment Primer for Lithium, Cobalt and Graphite (Kevin J.)

We've noticed that during the rare earth element bubble in 2010–2011, people didn't know what these niche minerals that go into everyday critical technologies were or where they were sourced. We've seen that knowledge grow in the last five years and downstream companies like Apple and Tesla are now aware of what the raw materials are and where they come from.

Disruptive technologies are completely new markets that are creating new value chains, products such as smartphones, electric vehicles and different types of energy storage. Growth in these new markets are affecting not only their own supply chains, but also those of existing industrial markets that rely on the same raw materials.

Gold Daily and Silver Weekly Charts - What Recovery - Peak Junk - Currency Wars (thc0655)

So if the people do not have the money to buy, and cannot keep increasing their private debt to service consumption because of the predatory lending rates and usurious fees in the system, guess what happens to aggregate demand? Duh.

This is not new. This is not unknown to economists. Thanks to Wall Street On Parade for reminding us of Franklin Roosevelt's campaign speech delivered at Oglethorpe University in 1932 during the depths of the Great Depression.

Zimbabwe adopts Chinese yuan as legal currency (Arthur Robey)

Zimbabwe, once a colony of the UK, has seen significant inflation over the years. Therefore, Zimbabwe has introduced several foreign currencies for relief. Meanwhile, there is no rush to reenact the Zimbabwean dollar, says Charity Dhiwayo, governor of the Reserve Bank of Zimbabwe.

In 2009, Zimbabwe adopted the US dollar and the South African rand. In 2014, Zimbabwe announced it would accept more foreign currencies, including the Japanese yen, the Australian dollar, the Indian rupee, and the Chinese yuan. However, in practice, the US dollar has been dominant in local markets.

Take the Gold, Leave the Cash (Tiffany B.)

If your gold is in a private, non-bank storage facility, such as a secure vault, however, the case is not so simple. Section of the IRS Internal Revenue Manual states that “Other financial accounts generally encompass any accounts in which the assets are held in a co-mingled fund and the account owner holds an equity interest in the fund.” So whether your gold in a private vault — like the Perth Mint — is considered an “other financial account” by the IRS depends on whether the gold is “allocated” or “unallocated.”

‘Net Energy’ Deficit Preventing Economic Growth

The economy operates within a finite world, so at some point, a problem of diminishing returns develops. In other words, it takes more and more effort (human labor and use of resources) to produce a given quantity of oil or food, or fresh water, or other desirable products. The problem of slowing economic growth is very closely related to the question: How can the limits we are reaching be expected to play out in a finite world? Many people imagine that we will “run out” of some necessary resource, such as oil, but I see the situation differently. Let me explain a few issues that may not be obvious.

Did The EPA Intentionally Poison Animas River To Secure SuperFund Money? (Wendy SD)

A week before The EPA disastrously leaked millions of gallons of toxic waste into The Animas River in Colorado, this letter to the editor was published in The Silverton Standard & The Miner local newspaper, authored by a retired geologist detailing verbatim, how EPA would foul the Animas River on purpose in order to secure superfund money.

Study finds price of wind energy in US at an all-time low, averaging under 2.5 cent/kWh (Arthur Robey)

The continued decline in average wind prices, along with a bit of a rebound in wholesale power prices, put wind below the bottom of the range of nationwide wholesale power prices in 2014. Wind energy contracts executed in 2014 also compare very favorably to a range of projections of the fuel costs of gas-fired generation extending out through 2040. These low prices have spurred demand for wind energy, both from traditional electric utilities and also, increasingly, from commercial customers.

Australians Survived a 13-Year Drought by Going Low-Tech (Wendy SD)

If you think California’s four-year drought is apocalyptic, try 13 years. That’s how long southeastern Australia suffered through bone-dry times. But it survived. When the so-called Millennium Drought ended in 2009, residents of Melbourne, Australia’s second-largest city, were using half the amount of water they had when it began. A group of researchers from the University of California, Irvine, set out to investigate how Melbourne, a city of 4.3 million people, dramatically cut water consumption, and whether the city’s experience might hold lessons for California and other drought-stricken regions. The short answer? Salvation came from a $2,000 rainwater tank rather than a $6 billion desalinization plant.

Almost half of Americans live in places that could be struck by damaging earthquakes (Wendy SD)

Preparing oneself -- emotionally and otherwise -- for the ground to shake is something that half of Americans should consider doing. That's because about 143 million people in the 48 contiguous states live in areas at risk for potentially damaging earthquakes, according to U.S. Geological Survey research published Monday in the journal Earthquake Spectra.

Gold & Silver

Click to read the PM Daily Market Commentary: 8/12/15

Provided daily by the Peak Prosperity Gold & Silver Group

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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Japan Can Offset China Yuan Move by Easing, Says Abe Adviser


  1. Japan Can Offset China Yuan Move by Easing, Says Abe Adviser
  2. Japan machinery orders tumble in June, add to second-quarter GDP contraction fears
  3. ECB Prepared to Tweak QE If Needed as Recovery Disappoints
  4. Deeper yuan devaluation trims U.S. rate hike bets
  5. Yuan Shock Sends Saudi Riyal Devaluation Wagers to Six-Year High
  6. Surge in Commercial Real-Estate Prices Stirs Bubble Worries
  7. The Yuan Drop Just Added $14 Billion to Asia Inc.’s Debt Burden
  8. Serb Central Bank Unexpectedly Cuts Rate on Dinar, Inflation
  9. Mexico’s Central Bank Cuts 2015 Growth Forecast
  10. eurozone economic growth likely eased in second quarter
  11. Bank of Korea Points to China Risk, Holds Rate at Record Low
  12. Malaysia Growth Cools as Pressure Builds to Boost Confidence
  13. Steel industry decries Chinese currency devaluation
  14. Peso closes at 5-year low as fears of 'currency war' loom (Philippines)
  15. China's currency devaluation: Thailand's economic nightmare?
  16. Devaluation Hints at China’s Rising Distress Over Economy
  17. BlackRock Says Canada Needs Quantitative Leap to Rescue Economy
  18. Greece creditors raise 'serious concerns' about spiralling debt levels
  19. European Document Expresses Deep Concerns About Greek Government Debt
  20. China cannot risk the global chaos of currency devaluation (Ambrose Evans Pritchard)
  21. Strategist: Financial market rout like 2008's is ahead
  22. Public debt ceiling to be raised by 17.8% (Thailand)
  23. Canadians' Debt Soars In BMO Survey, And Half Plan To Borrow More
  24. Total U.S. Auto Lending Surpasses $1 Trillion for First Time
  25. Student debt goes up and up
  26. Massive Layoffs Underway at Major Korean Shipbuilders
  27. Oil Majors’ $60 Billion Cuts Don’t Go Far Enough as Crude Slides
  28. Kansas $1 billion bond sale bolsters pensions eyeing hedge funds
  29. Standard Chartered’s Bad Loans to Soar in Asia, Jefferies Says
  30. Honeymoon over for Renzi as Italian reality confounds ambitions
  31. Making U.S. Pensions Honest About Returns Means Bigger Deficits
  32. California pension funds lose $5 billion on fossil fuels — report
  33. Europe in crisis: everyone from Putin to ordinary savers is stockpiling gold


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Indian Bonds Gain as Slowing Inflation Opens Door for Rate Cut

"The rupee weakened to the lowest level since September 2013 as a central bank adviser said Thursday the currency needs to adjust downwards to help boost exports."

"Brazilian banks sent the Ibovespa to the biggest slide in the world after Banco do Brasil SA joined Itau Unibanco Holding SA in allocating more money for soured loans amid forecasts for the worst recession in 25 years."

"The move has created uncertainty about the state of China’s economy — and in turn the world’s — and the timing of interest rate rises by the Federal Reserve, as well as concerns about the prospects of a broad currency war."

"Central bankers across emerging markets are being forced into action to stem steep falls in their currencies, especially after China allowed its yuan to weaken to four-year lows this week.

A JPMorgan index tracking 22 emerging market currencies has hit successive record lows and with many analysts forecasting further yuan depreciation, more weakness likely lies for its peers.

Until recently, policymakers in the developing world, facing sluggish growth and shrinking exports, were relatively sanguine about currency weakness. That is still the case, but many now appear keen to prevent volatile swings or excessive declines that could exacerbate inflation and capital flight."






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Quiet here today...


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Shortages push some Venezuelans to queue overnight for food

Shortages push some Venezuelans to queue overnight for food  (Video)

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Austerity as financial terrorism

The mentality of the elite can be observed from comments like those of the economist Hayek. Unemployment was necessary, he wrote, as an alternative to corporal punishment for disciplining the labour force. In the absence of a “reservoir” of unemployed, he wrote “discipline cannot be maintained without corporal punishment, as with slave labour” (quoted in Smith and Max-Neef, Economics Unmasked, 2011 p 35)

But if austerity is financial sector sponsored terrorism, if it is the defensive strategy to shift the blame off its own shoulders for the financial crisis, it is clear that what needs to be counterposed is not “growth” – but measures that would help ordinary people feel safe. Safe that they will be able to pay the bills, safe that they will be able to meet their basic needs. A policy against terrorism is a policy that creates security. In this case security can only come about by being part of communities where people are looking after each other.

But surely, one is tempted to ask, is it not true that increasing income and therefore growth plays an important part in personal and collective risk management? If one has more income and wealth is one not further back from the cliff edge of potential ruin?

Of course there is truth in the idea that money means greater safety – particularly in an individualist and competitive society we are all supposed to look after ourselves individually. In consumer societies there are not enough common arrangements that one can join in order to contribute to communities that, in turn, look after their members. In the absence of protective communities more money appears to be the chief means of greater personal security. This is what the money men want us to think. It is why in time of crisis the owners and managers of the money system can use their control over the financial liquidity in circulation to create financial insecurity as a means of social control.


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oil prices

oil traded with a 41 handle today, closed at $42.23 a barrel


i find that a lot of what i thought i knew for certain has turned out to be wrong...


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Arthur Robey
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The domestication of man, Tall.


That is the lay of the land. A good article that I have not done justice to yet. (Mountains to climb, things to see, people to do.)

But I will note that humans are being driven to be more and more domesticated by the powerful forces of selection and breeding. Who claims eugenetics is not practiced? It is. But it is done with more circumspection,  more underhand.

I have noticed that in my 43 years as an electrician that the trade has gone from one where one was expected to know all aspects of the trade and had autonomy, to one in which a passion for ones calling is frowned upon and punishable. The ideal electrician these days knows how to do endless reams of paperwork, to follow instructions. I am under the impression that doctors too face a similar situation.

This domestication has led to a physical reduction in brain size. Cro-Magnon's brain was bigger than Homo Domesticuses .

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