Tag Archives: banks

  • Insider
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    The 3 Likeliest Ways Things Will Play Out From Here

    Do you have a plan for each?
    by Chris Martenson

    Thursday, September 25, 2014, 7:58 PM

    35

    Executive Summary

    • The wisdom and value of scenario planning
    • Scenario #1: A Slow Burn
    • Scenario #2: Fragmentation
    • Scenario #3: A Hard Landing
    • The prudence of taking individual action now, vs depending upon "the system" to react to future events

    If you have not yet read Part 1: Ready Or Not available free to all readers, please click here to read it first.

    It all begins with the clear-eyed recognition that the old way of doing business is clearly unsustainable. And yet knowing that the various governmental and institutional powerbrokers are doing everything they can to perpetuate the status quo way of doing business.

    Business-as-usual is literally going to end in some flavor of disaster, and yet we collectively adhere to it, even when the end-point is as obvious as calculating the linear rate of withdrawal of water from a non-renewing aquifer.

    But there's nothing linear about the nested and/or intertwined complex systems we call the Economy, the Environment and Energy.  Each of these is independently complex, meaning they often easily defy the attempts to manage them. And they are utterly unpredictable for anything longer than the immediate term.

    For example, of the three, Energy seems the simplest, and it is.  But even there, we note that the amount of energy that can and will be extracted is a function of the price of energy, available technology and skills, capital available for investment, and what's actually down there in the earth to be pulled up.  In that list, several factors are courtesy of the Economy, which is itself dependent on Energy. A glitch in one can feedback rapidly to create a glitch in the other.

    Given all of this complexity, one good way to get a handle on things is to identify the scenarios we deem to be most likely given all available evidence, and then assign probabilities to each. Asking ourselves, What can we today to prepare for Scenario X? then allows us to begin constructing action plans to mitigate our vulnerability, and even better in cases, position ourselves to prosper as the future unfolds. 

    Scenario #1:  A Slow Burn

    In 2008, the practice of borrowing too much caught up with the developed world and a serious financial crisis threatened to take down the entire financial system.  Indeed, according to after-action reports from Hank Paulson (then Treasury Secretary) and Mervyn King (then BoE chairman), the world came within mere hours of a full-blown global banking system meltdown…

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  • Blog
    Peak Prosperity

    Quantitative Easing – Crash Course Chapter 10

    What exactly is this process that the world is betting on?
    by Adam Taggart

    Saturday, August 23, 2014, 1:34 AM

    11

    At the exponential pace at which the Fed is increasing the money supply, and knowing the huge challenges the Fed – and most other world central banks  – face in trying to stop or even slow down their money printing, the potential for a disruptive global inflationary period is very real.

    So what exactly is quantitative easing

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  • Blog
    Peak Prosperity

    Money Creation: The Fed – Crash Course Chapter 8

    Creating money out of thin air since 1913...
    by Adam Taggart

    Saturday, August 9, 2014, 12:49 AM

    48

    Chapter 8 of the Crash Course is now publicly available and ready for watching below.

    As a follow-on to the two previous chapters — one explaining the nature of fiat money, the other showing how money is loaned into existence through our fractional reserve banking system — this week's video details the Fed's near-magical ability to create money out of thin air (literally!).

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  • Blog
    Peak Prosperity

    Money Creation: Banks – Crash Course Chapter 7

    Get ready for your mind to be repelled
    by Adam Taggart

    Saturday, August 2, 2014, 1:14 AM

    5

    Chapter 7 of the Crash Course is now publicly available and ready for watching below.

    As a follow-on to the previous chapter explaining the nature of fiat money, this week's video details one of the two methods by which it is created: fractional reserve banking. As John Kenneth Galbraith famously stated "The process by which money is created is so simple the mind is repelled."

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  • Insider
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    The Trouble with Numbers

    Our 'good' data worsens the closer we look
    by Chris Martenson

    Tuesday, June 10, 2014, 4:06 PM

    4

    According to the ever-strident popular press, the world is in recovery. The stock market says so, the bond market says so, and the politicians and monetary bureaucrats all say so.

    The only trouble is the central banks continue to flood the world with liquidity, something they shouldn't need to be doing if a true recovery were really upon us.

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  • Insider

    China’s Demand for Gold Has Trapped The West’s Central Banks

    Kill the banks or kill their currencies?
    by Adam Taggart

    Wednesday, April 9, 2014, 10:12 PM

    45

    Every once in a while, an Off the Cuff interview is so important that we decide to make it available to the entire public. This is one of those occasions.

    In this week's Off the Cuff podcast, Chris and Alasdair Macleod build on the insights laid out in Chris' recent mega-report last week on gold: The Screaming Fundamentals for Owning Gold. And specifically, they delve deeply into the poorly-understood topic of why Chinese demand has become such a game changer in recent years.

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  • Insider
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    Using Gold to Protect Yourself In Advance of the Greatest Wealth Transfer of Our Lifetime

    A how-to guide
    by Chris Martenson

    Friday, April 4, 2014, 1:44 PM

    28

    Executive Summary

    • The case for gold's manipulated price, and how that can be used to work to your advantage
    • Calculating the "floor" beneath which gold will likely not fall
    • The coming Great Wealth Transfer, which almost certainly will occur in our lifetime
    • How much to invest in gold
    • How to invest in gold
    • Exit strategies: when will it make sense to sell your holdings? And what should you exchange them for?

    If you have not yet read The Screaming Fundamentals For Owning Gold, available free to all readers, please click here to read it first.

    Market Manipulation

    Before we can address the idea of storing some of your wealth in gold (and/or silver) we have to visit the topic of market manipulation. As many of you are aware this is an area of exceptional controversy, although I am not entirely sure why given the distressing laundry list of recently proven, and often grotesquely brazen, market manipulations performed by big banks in many other market areas.

    Big banks have been proven or alleged to have manipulated energy markets, LIBOR, currency markets, the global oil market, and aluminum, among other things and all of these transgressions happened after they got caught engaging in forgery and fraud during the mortgage swindles of 2005 to 2007.

    On one side of the manipulation debate, we might place the Gold Anti-Trust Action (GATA) organization alleging constant official manipulation to suppress the price of both gold and silver, and on the other we might place Jeff Christian, managing director of the metals research firm CPM, whose position is that all price movements can be explained by ordinary market forces.

    I happen to be somewhere in between those views as I think both legitimate and illegitimate forces are part of the landscape. But I am heavily tilted towards market manipulation as the explanation for why gold (and silver) tend to move downwards violently from time to time and why the prices for each are not higher than they currently are.

    The SEC has a clear definition of market manipulation and I’ve reproduced it here but swapped out the words ‘security’ and ‘stock’ with ‘gold’ to make it that much clearer:

    Manipulation

    Manipulation is intentional conduct designed to deceive investors by controlling or artificially affecting the market for gold. Manipulation can involve a number of techniques to affect the supply of, or demand for, gold. They include: spreading false or misleading information about gold; improperly limiting [or expanding] the supply of gold; or rigging quotes, prices or trades to create a false or deceptive picture of the demand for gold. Those who engage in manipulation are subject to various civil and criminal sanctions.

    (Source)

    I also added the two words "or expanding" because that condition also applies to commodities. 

    How likely is it that some firms have been trading in gold in such a way as to create a false, rigged, or deceptive picture of gold (and silver) prices?  It’s all but proven in a court of law, but don't hold your breath waiting for that final proof, as the US court system has vigorously defended banks from such lawsuits for decades. 

    I also happen to believe that gold is officially suppressed in price because it's what I would do if I were at the helm of the Fed and cared only for bolstering confidence in the dollar specifically, and fiat currencies generally, making the stock market a more attractive alternative, and also lending credence to political and monetary decisions (for the record, I am merely placing myself in the mind of the enemy here). Given that set of mandates, I would order up some hefty gold suppression because gold has a very bad habit of casting a bright light on rotten monetary and fiscal policy. 

    Suppressing the price of gold just makes so much sense that I would consider it a form of derelict strategic weakness if the Fed et al. were not doing it.

    One of the more important times to suppress the price of gold would be when…

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  • Blog
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    Have We Reached Peak Wall Street?

    An argument its dominance is in decline
    by charleshughsmith

    Monday, March 31, 2014, 11:14 PM

    18

    Though the mainstream financial media and the blogosphere differ radically on their forecasts—the MFM sees near-zero systemic risk while the alternative media sees a critical confluence of it—they agree on one thing: the Federal Reserve and the “too big to fail” (TBTF) Wall Street banks have their hands on the political and financial tiller of the nation, and nothing will dislodge their dominance.

    But what id Wall Street’s power has peaked and is about to be challenged by forces that it has never faced before? Put another way,what if the power of Wall Street has reached a systemic extreme where a decline or reversal is inevitable?

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  • Blog
    Oleksii Sergieiev | Dreamstime.com

    Why 2014 Is Beginning to Look A Lot Like 2008

    The similarities are stacking up
    by charleshughsmith

    Wednesday, March 12, 2014, 4:06 PM

    17

    Does anything about 2014 remind you of 2008? 

    The long lists of visible stress in the global financial system and the almost laughably hollow assurances that there are no bubbles, everything is under control, etc. etc. etc.  certainly remind me of the late-2007-early 2008 period when the subprime mortgage meltdown was already visible and officialdom from Federal Reserve chairman Alan Greenspan on down were mounting the bully pulpit at every opportunity to declare that there was no bubble in housing and the system was easily able to handle little things like default

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  • Podcast

    Dan Ariely: Why Humans Are Hard-Wired To Create Asset Bubbles

    Our evolutionary programming often works against us
    by Adam Taggart

    Saturday, February 15, 2014, 5:25 PM

    27

    Renown behavioral economist Dan Ariely explain why humans are biologically wired to make irrational decisions when money is involved. It's a case of our evolutionary wiring interfering with the decisions we face in a modern world very different from the one our ancestors adapted to.

    In this podcast, Chris and Dan explore the human cognitive triggers that have led us to our third major bubble in 15 years (tech stocks, housing, credit) and why our natural programming often works against our best interests. In certain cases, like the banking sector, bad decision-making has become so ingrained in our institutions that Ariely thinks the "clean slate" approach is our best option should we have the courage to deploy it:

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