The fraudulent criminals in the Federal Reserve and U.S. government are operating in “full smoke and mirror mode,” promoting the illusion of prosperity while covering up their massive trail of lies and deceit.
There is nothing honorable or trustworthy in anything they do.
A recent admission by the Justice Department regarding crimes in the financial sector really exposes the truth. It tells us who is running the show.
In the past month, the Justice Department released the stunning admission that in determining whether or not to prosecute crimes in the financial arena, it took into account the likely systemic effect of that prosecution.
My head is still reeling from that admission. Most people would agree that that’s not the Justice Department’s role. And I think it’s caused a really reasonable, serious, and continued undermining of trust in our markets.
Jim Chanos: Well, I think the best comment was from a senior Democratic senator a number of years ago, who simply and bluntly said, “The banks own this place.”
I always tell the story that right after the Bear Stearns collapse in March of ’08, the heads of all the big banks and brokers headed down to Washington immediately in April of ’08 to talk to senators and other lawmakers and regulators.
As we now know, what they didn’t ask for was forgiveness for their misdeeds or perhaps forbearance on capital until they could get their house in order or to work with the regulators on what was obviously a massive credit crunch coming. No, what they asked for was two things. They asked for the accounting rules to be liberalized on their hard-to-value assets and for short-sellers to be cracked down on.
That was their focus, and, by the way, both happened. There were short-selling bans shortly thereafter and the accounting profession, at the urging of Washington, changed, liberalized, the rules on hard-to-value assets in March of ’09. They got what they wanted, and this tells you something.
It really is amazing to the extent that lawmakers, despite all the evidence that major legislative initiatives that banks have asked for in the last 50 years have generally been harmful to the public purse, they’ve generally gotten what they’ve asked for. You can’t be too cynical.
More recently, Sen. Dick Durbin (D-Ill.) expressed his thoughts on this. Sen. Durbin has been battling the banks the last few weeks in an effort to get 60 votes lined up for bankruptcy reform. He’s losing.
Last Monday night, in an interview with a radio host, he came to a stark conclusion: The banks own the Senate.
“And the banks — hard to believe in a time when we’re facing a banking crisis that many of the banks created — are still the most powerful lobby on Capitol Hill. And they frankly own the place,” he said on WJJG 1530 AM’s “Mornings with Ray Hanania.”
As I’ve watched this ongoing circus of stupidity and criminal behavior over the years, I’ve been amazed they have been able to get away with it for as long as they have without a revolt from the public.
The consequences, however, are finally catching up with them on all fronts — thus the increased desperation in everything they manufacture to keep the wolves at bay.
The latest nonsense coming from the Fed banksters is the so-called “friendly taper,” which will be scaling back monthly electronic money creation by $10 billion a month starting in 2014.
Oh, hey, I’m impressed. These people must be geniuses… NOT!!!
In other words, if an intelligent person is to believe that the banksters have only been creating $85 billion a month of funny money (in reality it is much more), then reducing this amount by $10 billion means that everything is great, so let’s party some more.
The reasoning touted in the mainstream media regarding this charade is almost as stupid as Al Gore stating in 2008 that the polar ice caps would be melted by 2013.
In my view, this so-called “friendly taper” is just a publicity stunt to make it look like these Keynesian economic idiots are doing something for the economy. In reality, this is just more foreshadowing of the insanity that is coming our way. The bottom line to all this is that the Fed, regardless of its rhetoric, will have to create QE till the cows come home. It’s already creating more every month than it lets out to the public.
The public believes (based on the always-trustworthy media reports) that the Fed has only been creating $85 billion a month. I believe it is more than double that.
In other words, I would bet that this ridiculous announcement would be even more absurd and misleading if we really understood the truth of the matter.
I would guess that what is really happening is more like this: The Fed has been creating $200 billion a month out of thin air to keep its Ponzi scheme alive and well but letting it out to the public that it is only creating $85 billion. That means the taper nonsense is all total disinformation because what the public sees and what the Fed is actually doing are two totally different things.
Call me cynical… call me paranoid… but one day, I hope the public will know the full truth of these matters — and why central banks and their puppet politicians should never be trusted.
But why so much fuss to confuse the public about QE and tapering?
Paul Craig Roberts weighed in on this yesterday, when he said the following:
The conclusion is obvious. QE helps the big banks, and manipulation of the gold price downward protects the US dollar from its dilution by QE.
The Fed’s reduced bond purchasing announced for the New Year still leaves the Fed purchasing $900 billion worth of bonds annually, so obviously the Fed does not think that everything is OK. Moreover, the Fed has other ways to make up for the $120 billion annual reduction, assuming the reduction actually occurs.
But my conclusion is that the Fed understands that it must protect the dollar from being driven down by QE and that the orchestrated takedowns of gold are part of protecting the dollar’s value, and perhaps also the cutback in QE is a part of the protection by signaling an end of money creation. The Fed also understands that it cannot forever drive down the gold price and that it cannot forever pour liquidity into stock and bond markets. To retreat from this policy without crashing the edifice requires successful orchestrations. Therefore, we are likely to experience more of them in the days to come.
Allegedly, the US has free capital markets, and globalism is bringing free capital markets to the world. In actual fact, US capital markets are so manipulated — and now by the authorities themselves — that manipulation cannot stop without a crash.
What American “democratic capitalism” has brought to the world is manipulated financial markets and the absence of democracy. How long this game can play depends on the outside world.
This explains a lot. But for us as investors, it is not easy to watch the demise of our precious metals mining shares, despite the fact that we will get the last laugh.
How long we may have to bide our time till that happens is really the only question at hand.
I continue to maintain that dollar-cost average purchases of precious metals and quality junior mining shares will eventually prove correct, regardless of how long we may have to wait.
What is coming is the mother of all bull market runs in precious metals. When it happens, it will be the big one many have forecast — the one that will reward investors whose patience has been, and will yet be, tried beyond what one should ever have to endure.
I remain confident in gold’s future prospects regardless of what governments or their central banks do or tell us. I see gold and silver’s current correction as the ultimate buying opportunity before the biggest run in the history of reporting for precious metals.
This tells me gold will head far higher in the long-term, whether or not it bottoms out here or first falls another 10%. In the end, it won’t matter what you paid for the physical precious metals you bought along the way. All that will matter is that you own them.
But what will really drive gold to levels the general public cannot understand will be the re-emergence of gold as a monetary metal. This will happen as the U.S. dollar partially or totally loses its status as world reserve currency, something I believe will begin to unfold in 2014.
The coming global currency reset I have already talked about will be the event that will set all of this in motion.
The writing is on the wall for those who have eyes and are willing to bide their time.
Have no fear… the big move in precious metals is closer than you think.
Until next time,
Greg McCoach for Wealth Daily
