Jim Rogers: Fed Will Launch QE3 by Q3

The head of Rogers Holdings expects this will happen "in the fall or early next year,” Rogers told CNBC, as FT Adviser reported.

http://www.moneynews.com/StreetTalk/JimRogers-Fed-Launch-QE3/2011/07/19/id/404095?s=al&promo_code=CA65-1

Poor Man's Gold is Breaking Out -- Sell Your House and Buy Silver?

Investors have pushed silver above the recent channel high at around $39 or so per ounce and I fully expect a retest of $50 if any more talk is given about QE3 — Silver rises because of the rising digital money supply, not from speculation. Owning cash is speculative whereas owning metals is conservative or a safe haven at current prices.

http://www.businessinsider.com/poor-mans-gold-is-breaking-out-sell-your-house-and-buy-silver-2011-7

The Fed Is Now More Leveraged That Lehman Brothers Was

The 2008 Crisis occurred when private US banks became so distrustful of one another’s balance sheet risk that interbank liquidity dried up triggering a systemic implosion in the unregulated derivatives market, particularly in Credit Default Swaps (which was a $50-60 trillion market at the time).

The Federal Reserve dealt with this situation by suspending accounting policies (permitting banks to lie about their true balance sheet risk), offering to backstop those banks with the greatest derivative exposure (JP Morgan, Bank of America, Goldman Sachs, and Citigroup), shifting trillions of dollars’ worth of toxic debt to the US balance sheet and then funneling trillions of new dollars into the banks most at risk of a derivative collapse (the banks I listed before).

http://gainspainscapital.com/?p=591

Get Ready for a 70% Marginal Tax Rate

President Obama has been using the debt-ceiling debate and bipartisan calls for deficit reduction to demand higher taxes. With unemployment stuck at 9.2% and a vigorous economic "recovery" appearing more and more elusive, his timing couldn't be worse.

Two problems arise when marginal tax rates are raised. First, as college students learn in Econ 101, higher marginal rates cause real economic harm. The combined marginal rate from all taxes is a vital metric, since it heavily influences incentives in the economy—workers and employers, savers and investors base decisions on after-tax returns. Thus tax rates need to be kept as low as possible, on the broadest possible base, consistent with financing necessary government spending.

http://online.wsj.com/article/SB10001424052702304911104576443893352153776.html?mod=WSJ_Opinion_LEADTop

A New Surge In Job Layoffs

Companies are laying off employees at a level not seen in nearly a year, hobbling the job market and intensifying fears about the pace of the economic recovery.

Cisco Systems Inc., Lockheed Martin Corp. and troubled bookstore chain Borders Group Inc. are among those that have recently announced hefty cuts, while recent government numbers underscore how companies have shifted toward cutting jobs.

The increase in layoffs is a key reason why the U.S. recorded an average of only 21,500 new jobs over the past two months, far below the level needed to bring down unemployment, which now stands at 9.2%.

http://www.declineoftheempire.com/2011/07/a-new-surge-in-job-layoffs.html

Audit: Fed gave $16 trillion in emergency loans to foreign banks

The U.S. Federal Reserve gave out $16.1 trillion in emergency loans to U.S. and foreign financial institutions between Dec. 1, 2007 and July 21, 2010, according to figures produced by the government’s first-ever audit of the central bank.

Last year, the gross domestic product of the entire U.S. economy was $14.5 trillion.

http://runronpaul.com/mainstream-media/audit-fed-gave-16-trillion-in-emergency-loans-to-foreign-banks/

Iran Opens Oil Bourse - Harbinger of Trouble for New York and London?

The last three years of global recession have dealt a major blow to American capitalist ideas trumpeted throughout the world on the value of “free markets.” Wall St has been revealed as a form of casino economy, with the bankster insiders gambling with other people’s, and eventually, the government’s money in the form of bailouts. As the Republicans in Congress, scenting victory in the 2012 presidential elections, hold a gun to the Obama administration’s head and rating agencies consider downgrading U.S. government bonds in light of Washington’s possible defaulting, many ideas around the world that previously seemed implausible because of the dominance of the U.S. economy are garnering renewed interest.

http://oilprice.com/Energy/Crude-Oil/Iran-Opens-Oil-Bourse-Harbinger-of-Trouble-for-New-York-and-London.html

Fitch reiterates warning on U.S. credit rating

Fitch Ratings on Monday reiterated its view that if the U.S. debt ceiling is not raised prior to August 2, the agency will place the U.S. AAA rating on what it terms "ratings watch negative," meaning it could downgrade it within three to six-months.
Fitch prefaced its statement by saying it still believes an agreement on the debt ceiling will met before the deadline set by the U.S. Treasury.

"Agreement on a credible fiscal consolidation strategy will secure the U.S. 'AAA' status; failure to do so will inevitably weaken the sovereign credit profile and may result in a sovereign rating downgrade," Fitch said.

The U.S. Treasury Department has said if the debt ceiling is not raised by August 2, it will have to start prioritizing payments.

http://finance.yahoo.com/news/Fitch-reiterates-warning-on-rb-1114763265.html?x=0

How to make sense of the gold-to-silver ratio

Silver’s recent climb has significantly outpaced gains made by gold. But a closely watched ratio based on the two prices suggests silver has even more catching up to do, analysts say.

http://www.marketwatch.com/story/how-to-make-sense-of-the-gold-to-silver-ratio-2011-07-19

Europe's Contagion Effect: Prepare for a Global Economic Collapse

Europe is on the brink of a major financial disaster. Moody’s has downgraded Irish and Portuguese debt to junk, a status until now reserved for Greece. This in turn has led interest rates on Spanish and Italian debt to spike. Contagion of these two major economies is now imminent. If it happens, the global economy will plunge into a crisis that will make the 2008 bankruptcy of Lehman Brothers look like a cakewalk.

http://nationalinterest.org/commentary/europes-contagion-effect-prepare-global-economic-collapse-5640