Dollar to Become World's `Weakest Currency,' Drop to 75 Yen JPMorgan Says

The dollar may fall below 75 yen next year as it becomes the world’s “weakest currency” due to the Federal Reserve’s monetary-easing program, according to JPMorgan & Chase Co.

The Fed said on Nov. 3 it will buy $75 billion of Treasuries a month through June to cap borrowing costs. The central bank has kept its benchmark rate in a range of zero to 0.25 percent since December 2008. The Bank of Japan on Oct. 5 cut its key rate to a range of zero to 0.1 percent and set up a 5 trillion yen ($59.9 billion) asset-purchase fund.

http://www.bloomberg.com/news/2010-11-18/dollar-to-become-world-s-weakest-currency-drop-to-75-yen-jpmorgan-says.html

Food price index jumps 10.30%

India's food price index rose 10.30%, while the fuel price index climbed 10.57% in the year to Nov. 6, government data on Thursday showed.

In the prior week, annual food and fuel inflation stood at 12.30% and 10.67%, respectively.

The primary articles price index was up 13.30% in the latest week compared with an annual rise of 14.87% a week earlier.

The wholesale price index , the most widely watched gauge of prices in India, rose 8.58% in October from a year earlier compared with 8.62% in September, data on Monday showed.

http://www.moneycontrol.com/news/economy/food-price-index-jumps-1030-_499955.html

China to subsidize food after price spike

BEIJING – China's government announced food subsidies for poor families Wednesday as it tries to cool a double-digit surge in prices that communist leaders worry might stir unrest.

The Cabinet promised to ease shortages of vegetables and grain that helped push up food prices by more than 10 percent in October. It promised more supplies of diesel to end fuel shortages that have disrupted trucking and industry.

http://news.yahoo.com/s/ap/20101117/ap_on_bi_ge/as_china_inflation

WHAT’S REALLY BEHIND QE2?

The deficit hawks are circling, hovering over QE2, calling it just another inflationary bank bailout. But unlike QE1, QE2 is not about saving the banks. It’s about funding the federal deficit without increasing the interest tab, something that may be necessary in this gridlocked political climate just to keep the government functioning.

On November 15, the Wall Street Journal published an open letter to Fed Chairman Ben Bernanke from 23 noted economists, professors and fund managers, urging him to abandon his new “quantitative easing” policy called QE2. The letter said:

We believe the Federal Reserve’s large-scale asset purchase plan (so-called “quantitative easing”) should be reconsidered and discontinued. . . . The planned asset purchases risk currency debasement and inflation, and we do not think they will achieve the Fed’s objective of promoting employment.

http://www.webofdebt.com/articles/qe2.php

Ireland fears civil unrest as bank crisis deepens

One of Ireland's biggest trade unions warned today that the nation was on the brink of civil unrest as government officials negotiated a multibillion euro bailout for the country's ailing banks.

The Technical Engineering and Electrical Union said further "draconian" public sector cuts of €15bn (£13bn) over four years could lead to street disorder. It urged a campaign of civil disobedience unless the taoiseach, Brian Cowen, calls an immediate election. An emergency cabinet tomorrow will discuss the new round of cuts.

http://www.guardian.co.uk/business/2010/nov/20/ireland-union-devoy-bank-crisis

Fed Warns of 4.25 Million More Foreclosures Through 2012

The Federal Reserve expects about 4.25 million more foreclosure filings through 2012, and problems with the home-seizure process may threaten the U.S. housing and economic recovery, Fed Governor Elizabeth Duke said in prepared testimony.

http://www.moneynews.com/StreetTalk/Fed-Warns-Foreclosures/2010/11/18/id/377430?s=al&promo_code=B263-1

Silver Sales to Surge as Investors Seek Protection, Perth Mint Forecasts

Silver-coin sales will climb as investors seek to protect their wealth from weakening currencies, according to the Perth Mint, producer of about 6 percent of the world’s gold bullion.

The mint’s outlook adds to signs that global demand for silver, which trades for about 50 times less than gold per ounce, will increase. The Royal Canadian Mint said last week that silver-coin sales will jump more than 50 percent this year. The Perth Mint may match that gain, Currie said in an interview.

http://www.bloomberg.com/news/2010-11-22/silver-sales-to-surge-as-investors-seek-protection-perth-mint-forecasts.html

Pessimistic Fed to slash growth forecasts

The US Federal Reserve will slash its growth forecasts and predict higher unemployment when it releases updated economic projections this week.

The Fed will release the latest forecasts made by members of its rate-setting open market committee on Tuesday, alongside the minutes of their November meeting, giving a complete picture of why they launched a new $600bn round of asset purchases.

http://www.ft.com/cms/s/0/b92ecb0c-f596-11df-99d6-00144feab49a.html#axzz15yI1tXii

Bernanke Takes Aim at China

Federal Reserve Chairman Ben Bernanke fired back amid criticism at home and abroad of the Fed's easy-money policies, arguing that China and others are causing global problems by preventing their currencies from strengthening as their economies boom.

By keeping their currencies artificially weak, Mr. Bernanke argued in Frankfurt Friday, China and other emerging markets are allowing their economies to overheat, preventing trade imbalances from adjusting and worsening what he called a "two-speed" global recovery.

http://online.wsj.com/article/SB10001424052748703374304575623144102357582.html?mod=WSJ_hp_LEFTTopStories

Gary Shilling Sees `Significant' Stock Selloff Within 12 Months

“I don’t think it’s enough to make a great deal of difference,” Shilling, 73, president of the investment research firm A. Gary Shilling & Co. in Springfield, New Jersey, said in a telephone interview. “The earlier QE1 didn’t and I don’t think this will, either. The economy is weak and it doesn’t take very much of a shock to push it into negative territory. I don’t think that’s enough to justify where stocks are now.”

http://www.bloomberg.com/news/2010-11-12/gary-shilling-sees-equity-selloff-within-year-as-fed-fails-to-fix-economy.html

Gap, Wal-Mart Clothing Costs Rise on `Terrifying' Cotton Prices

Gap Inc., J.C. Penney Co. and other U.S. retailers may have to pay Chinese suppliers as much as 30 percent more for clothes as surging cotton prices boost costs.

“It’s a little terrifying to deal with cotton suppliers now,” said Vicky Wu, a sales manager at Suzhou Unitedtex Enterprise Ltd., a closely held, Jiangsu province-based clothes maker that counts Gap and J.C. Penney among its clients.

Cotton futures in China have surged more than 70 percent this year and were at a record earlier as the global economy emerged from recession, allowing people to spend more on clothes. Production of the fiber in China, the world’s biggest user and importer, is forecast to lag behind demand for a 12th year, cutting its stockpile to the smallest since 1995, according to the U.S. Department of Agriculture.

http://www.bloomberg.com/news/2010-11-16/gap-wal-mart-clothing-suppliers-raise-prices-on-terrifying-cotton-costs.html

Secret Walmart Survey Shows Inflation Already Here

There might not have been a second round of quantitative easing, if Federal Reserve Chairman Ben Bernanke shopped at Walmart.

A new pricing survey of products sold at the world’s largest retailer [WMT 54.13 -0.21 (-0.39%) ] showed a 0.6 percent price increase in just the last two months, according to MKM Partners. At that rate, prices would be close to four percent higher a year from now, double the Fed’s mandate.

http://www.cnbc.com/id/40135092

World economy faces 'difficult and dangerous times' warns Mervyn King

The world economy still faces "difficult and dangerous times" Bank of England governor Mervyn King warned today, although Britain's economic recovery is expected to remain on track.

Economists said the Bank's quarterly inflation report, published this morning, left the door open for more quantitative easing.

http://www.guardian.co.uk/business/2010/nov/10/world-economy-difficult-dangerous-times

Bernanke's Cowardice Has Sealed Our Fate

The day after the election, the Federal Reserve launched QE2, the second round of Quantitative Easing. This public relations euphemism attempts to hide the fact that the Fed is "printing money" (the Fed actually does it electronically these days). "Cheating, debasing, and inflating," as in stealing from the public, is a more accurate description.

Bernanke indicated that from 600 to 850 billion additional dollars would be created. To put this in perspective, the TARP package was in this range. The total Federal Reserve balance sheet was $829 billion at the end of 2004 and only $869 billion in August 2007. At the end of 2009, it had ballooned to over $2,200 billion. This announcement means it is headed to $3,000 billion (3 trillion).

http://www.americanthinker.com/2010/11/bernankes_cowardice_has_sealed.html

Markets alert for credit crunch 2.0

Is there a second credit crunch looming? Between now and the end of 2012, UK banks and building societies must find ways of refinancing between £750bn and £800bn of lending. That's a number approaching half GDP.

http://www.telegraph.co.uk/finance/comment/jeremy-warner/8118430/Markets-alert-for-credit-crunch-2.0.html

Bernanke's worst nightmare: Ron Paul

Ben Bernanke has had his hands full since his first day on the job as Federal Reserve chairman nearly five years ago. It's about to get even tougher.

His harshest critic on Capitol Hill, Rep. Ron Paul of Texas, is about to become one of his overseers.

http://money.cnn.com/2010/11/12/news/economy/Bernanke_Paul/index.htm?hpt=T2

G-20 faces urgent task of averting trade war

Leaders of the world's 20 biggest economies faced the urgent task at their summit Friday of resolving a U.S.-China currency dispute that has raised the specter of a global trade war.

http://finance.yahoo.com/news/G20-faces-urgent-task-of-apf-3884406748.html?x=0

Will You Be Able To Heat Your Home This Winter? Millions Of American Familes Will Not

Will you have a warm house to come home to this winter? If so, you should consider yourself to be very fortunate. With the United States experiencing the highest levels of long-term unemployment that it has seen since the Great Depression, millions of Americans families are simply out of money. All across America this winter, families are going to be forced to make some heart breaking decisions. For many, the choice will come down to either heating their home or putting food on the table. According to the National Energy Assistance Directors' Association, more than 10 million U.S. households will not be able to afford to heat their homes this winter without assistance, which would be a new all-time record. So, if you are in a position to easily heat your home this winter, be very, very thankful.

http://www.benzinga.com/10/11/587191/will-you-be-able-to-heat-your-home-this-winter-millions-of-american-familes-will-not

Modern day debt serfdom and rising prices not seen through the consumer price index.

Most Americans enjoy a good cup of coffee. Yet very few realize that coffee futures are now up over 50 percent for 2010. Creative packaging that includes smaller quantities but offers the same price helps delude many Americans into thinking their dollar still has the purchasing power of better days. This all occurs in a relatively subtle and typically hidden process. Cotton for example is now up 90 percent for the year. Corn is up over 40 percent. It would be one thing if this was all based purely on demand but more of this increase in price is coming from the Federal Reserve pursuing actions that are punishing the U.S. Dollar. The below chart is rather startling and shows that even though the CPI has remained weak, principally because of the crashing housing market, many other areas are seeing incredible price increases.

http://www.mybudget360.com/dark-ages-for-a-modern-middle-class-modern-day-debt-serfdom-and-rising-prices-not-seen/

No Inflation? Grocery Stores, Gas Prices Tell Different Story

From grocery stores to gas stations and most other consumer stops in between, price inflation is shaping up to be the biggest economic story ahead.

http://www.cnbc.com/id/40132000

The Price Of Oil Is Going Up, The Price Of Food Is Going Up And Now Here Comes Quantitative Easing

Millions of American families are about to be broadsided by rising gas and food prices and most of them don't even realize it. You see, most Americans stop listening when terms such as "quantitative easing" and "agricultural commodities" are brought up, but when millions more Americans are faced with a choice of either feeding their families or heating their homes this winter, maybe then they will start listening. Even before the Federal Reserve announced the latest round of quantitative easing, the price of oil has been going up and the price of food has been going up. Now that the Federal Reserve has announced plans to flood the economy with hundreds of billions more dollars, the inflation monster is going to get even hungrier. The household budgets of scores of American families are going to be stretched beyond the breaking point as prices rise. Meanwhile, the vast majority of U.S. employers will not be giving their workers raises to keep up with inflation. After all, why should they? If someone wants to quit there are hordes of unemployed Americans out there who would just love to take that job in a second.

http://endoftheamericandream.com/archives/the-price-of-oil-is-going-up-the-price-of-food-is-going-up-and-now-here-comes-quantitative-easing

Food Sellers Grit Teeth, Raise Prices

Packagers and Supermarkets Pressured to Pass Along Rising Costs, Even as Consumers Pinch Pennies

http://standeyo.com/NEWS/10_Food_Water/101104.foodsellers.grit.teeth.html

Food price fears as US warns on crop yields

The spectre of inflation loomed over agricultural markets after the US slashed key crop forecasts and warned of shortfalls in grains.

The agriculture department on Tuesday cut estimates of US corn yields for a third successive month, forecast record soyabean exports to China and warned of the slimmest cotton stocks since 1925.

"The combined production shortfalls and dramatic potential stock drawdowns mean a much tighter supply picture than just a few months ago," the agency said in a separate grains report.

http://edition.cnn.com/2010/BUSINESS/11/09/food.price.fears.crop.ft/index.html?hpt=T2

Gold, Agriculture Are `Safest Long Positions,' Deutsche Bank's Lewis Says

Precious metals including gold and agricultural commodities may extend gains in the coming months as a declining dollar and tight supplies boost demand, according to Deutsche Bank AG.

A lot of agricultural commodities including corn, soybeans and wheat are “still cheap” even after recent rallies, Michael Lewis, global head of commodities research, said in an interview. The surge in gold, which touched a record this week, is not yet extreme, Lewis said yesterday in Tokyo.

http://www.bloomberg.com/news/2010-11-11/gold-farm-commodities-to-extend-rallies-deutsche-bank-s-lewis-forecasts.html

Rising food prices cause headaches for local stores

General Mills says come next week, 25 percent of its cereals will see a single digit price increase, the first in three-and-a-half years.

Kraft foods is looking at price increases on almost half of it's products.

Corn, which is in nearly everything, is at a 26 month high price in commodities.

Soybeans are priced higher, sugar is at a demand it hasn't seen in 20 years and pork is expected to jump up in cost by 4.5 percent.

http://www.kare11.com/news/news_article.aspx?storyid=881411&catid=14

Greenspan warns over weaker dollar

The US is pursuing a policy of weakening its currency which is driving up exchange rates in the rest of the world, according to Alan Greenspan, the former chairman of the Federal Reserve.

Writing in today’s Financial Times ahead of the G20 meeting in Seoul, Mr Greenspan argues that with China also holding down the renminbi, the upward pressure on currencies elsewhere risks a return to widespread trade protectionism.

http://www.ft.com/cms/s/0/b6e3d086-ed12-11df-9912-00144feab49a.html#axzz14wHk2SXy

Bankruptcy of U.S. is ‘Mathematical Certainty,’ Says Former CEO of Nation's 10th Largest Bank

John Allison, who for two decades served as chairman and CEO of BB&T, the nation's 10th largest bank, told CNSNews.com it is a “mathematical certainty” that the United States government will go bankrupt unless it dramatically changes its fiscal direction.

Allison likened what he sees as the predictable future bankruptcy of the United States to the problems at Fannie Mae and Freddie Mac, whose insolvency he also said was foreseeable to those who studied their business practices and financial situation.

http://www.cnsnews.com/news/article/former-bbt-ceo-bankruptcy-us-mathematica

14 Pieces Of Bad Economic News

One Piece Of Moderately Good Economic News And 14 Pieces Of Bad Economic News That Are So Horrifying You Might Not Want To Read Them Standing Up

http://theeconomiccollapseblog.com/archives/one-piece-of-moderately-good-economic-news-and-14-pieces-of-bad-economic-news-that-are-so-horrifying-you-might-not-want-to-read-them-standing-up

The Coming Fiscal Catastrophe in the United States

This phenomenon arises from a straightforward application of conventional supply-side economics. Government borrowing absorbs private saving that would otherwise be used for capital formation. The diminished capital stock reduces productivity, growth, and competitiveness.


http://taxprof.typepad.com/taxprof_blog/2010/11/sullivan-the-.html

Food price fears as US warns on crop yields

The spectre of inflation loomed over agricultural markets after the US slashed key crop forecasts and warned of shortfalls in grains.

The agriculture department on Tuesday cut estimates of US corn yields for a third successive month, forecast record soyabean exports to China and warned of the slimmest cotton stocks since 1925.

“The combined production shortfalls and dramatic potential stock drawdowns mean a much tighter supply picture than just a few months ago,” the agency said in a separate grains report.

http://www.ft.com/cms/s/0/249211fc-ec1d-11df-9e11-00144feab49a.html#axzz14r1QJG56

The Growing Threat of Food Insecurity in America

When discussing the Great Recession, there are two standards for measuring its impact on the average household. The first is unemployment, which is currently hovering at 9.6%, down from a high of 10.1% in October 2009. The second is foreclosures, which hit a 50-year high in 2007 and have risen every year since then.

For much of the past three years, the recession narrative has been told in terms of these two dire numbers, showing how a failing economy has made it harder and harder to cling to the middle-class ideal of homeownership and a steady job. Recently, however, a third, even more disturbing figure has gained relevance: the number of Americans on food stamps.

http://www.dailyfinance.com/story/food-insecurity-in-america/19703458/

Germany, China, Brazil and South Africa have criticised US plans to pump $600bn (£373bn) into the US economy.

German Finance Minister Wolfgang Schaeuble said the US policy was "clueless" and would create "extra problems for the world".

The US Federal Reserve could weaken the US dollar and hurt exports to America.

China's Central Bank head Zhou Xiaochuan urged global currency reforms, while South Africa said developing countries would suffer most.

http://www.bbc.co.uk/news/business-11697483

Zoellick Suggests Return To Gold Standard

In a commentary piece in Sunday's Financial Times, Robert Zoellick laid out five effective reforms, and added that a new system, "should also consider employing gold as an international reference point of market expectations about inflation, deflation and future currency values. Although textbooks may view gold as the old money, markets are using gold as an alternative monetary asset today.

http://www.forbes.com/2010/11/08/gold-standard-zoellick-markets-currencies-g20-dollar-world-bank.html?boxes=Homepagechannels

The age of the dollar is drawing to a close

It's a strange, Alice in Wonderland world that sees one of the planet's richest economies borrowing from one of the poorest to pay for goods way beyond the reach of the people actually producing them. But that process, in effect, came to define the relationship between America and China.

http://www.telegraph.co.uk/finance/comment/jeremy-warner/8111918/The-age-of-the-dollar-is-drawing-to-a-close.html

Right Now, A Complete Collapse Of The Financial System Is Not Out Of The Question

In recent weeks, the explanation for the financial and economic crisis that has gripped the world economy has shifted sharply from deregulation and lack of governmental oversight of financial institutions to fraud and criminal activity. In truth, the U.S. Federal Bureau of Investigation began to warn of an “epidemic” of mortgage fraud back in 2004,

http://www.businessinsider.com/complete-collapse-not-out-of-the-question-2010-11

1Homeland Security To “Regionalize” Emergency Supplies Over Next 90 Days

According to some reports, there has been an acceleration within the emergency planning elements of our government, as if they are anticipating some type of event in the near future. Anecdotal evidence from freeze dried food manufacturers and private bunker construction firms indicates that the government is rapidly purchasing supplies, often leading to shortages for civilians trying to do the same.

http://www.shtfplan.com/emergency-preparedness/homeland-security-to-regionalize-emergency-supplies-over-next-90-days_11012010

Jim Sinclair - Gold Bottomed, Dollar Index Headed to 56

An interview with Jim Sinclair...

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2010/11/3_Jim_Sinclair_-_Gold_Bottomed,_Dollar_Index_Headed_to_56.html

When the Price of Silver Doubles in a Month

“Are you buying gold, silver and oil in fearful response to the Federal Reserve creating so much money that the wholesale debasement of the purchasing power of the dollar, popularly perceived as inflation in prices, is going to cause the gigantic inflation in consumer prices that was actually predicted earlier in the same sentence, spooky and Nostradamus-like, thus proving everything I said?”

http://www.finance-insurance-loans.com/finance/mortgage/when-the-price-of-silver-doubles-in-a-month/

Doubts grow over wisdom of Ben Bernanke 'super-put'

The early verdict is in on the US Federal Reserve's $600bn of fresh money through quantitative easing. Yields on 30-year Treasury bonds jumped 20 basis points to 4.07pc.

!!!READ THE LAST 3 PARAGRAPHS!!!

http://www.telegraph.co.uk/finance/economics/8111153/Doubts-grow-over-wisdom-of-Ben-Bernanke-super-put.html

Citi: Central Banks Are Going To Start Dumping Dollars In The Coming Weeks

With FOMC out of the way and largely meeting expectations, investors are looking for what comes next. We think that reserve managers will contribute to the next stage of USD weakness as QE2 confirms their worst fears about the Fed’s intentions and the quality of their reserves portfolios. To exacerbate their concerns, Global reserves have been growing very rapidly, on a headline basis about 11% over the last year and now are close to USD9trn (Figure 1). While Chinese reserves growth gets a large amount of attention, other countries reserves are growing similarly rapidly.

http://www.businessinsider.com/citi-central-bank-reserve-selling-2010-11?bcsi_scan_24DE46460B4E2EF0=IPKfojC3PU7Zp1dAaUNYYroeXQkHAAAAlmKqBA==

China tees up G20 showdown with US

China has curtly dismissed a US proposal to address global economic imbalances, setting the stage for a potential showdown at next week’s G20 meeting in Seoul.

http://www.ft.com/cms/s/0/03567a28-e8a3-11df-a383-00144feab49a.html#axzz14YXljYT4

Dollar at Risk of Crashing, Triggering Inflation:

Federal Reserve policies have put the US dollar the risk of crashing, which will hammer consumers through higher prices, strategist Axel Merk told CNBC.

Investors should brace for a much weaker dollar [.DXY 76.59 0.71 (+0.94%) ] by diversifying out of the greenback and into currencies of other countries, said Merk, chairman and chief investment officer of Merk Investments, of Portland, Maine.

http://www.cnbc.com/id/40007252

Gold, Silver Surge After Goldman Recommends Buying Gold... Again

Gold continues its push to $1,400. The catalyst: Goldman's David Greely has just released a report on gold saying that: "we expect that gold prices will continue to rise over the next 12 months to our $1650/toz target as US monetary policy remains accommodative and US real interest rates remain low. Further, the Federal Reserve’s return to quantitative easing and the movement of gold prices to these new record highs could spark renewed investor demand for gold, which has been remarkably subdued in recent months. This represents upside risk to both our forecasts and to gold prices." As Goldman's last call on gold marked a temporary peak in the appreciation, as we expected, this time the top ticking effect will likely be lost. We believe that $1,400 gold to be breached as soon as today.

http://www.zerohedge.com/article/gold-jumps-after-goldman-recommends-buying-gold-again

The BBC bunker they don't want you to know about

It all makes sense, once you know what you're looking at. The 200 acres of thickly wooded hillside, inaccessible by public footpath; the radio mast strategically poking out on top; the hidden entrance, just off the A44 near Evesham, in Worcestershire, surrounded by CCTV cameras and a high-security barrier. But to the passing motorist, there is nothing about Wood Norton Hall to identify it as the site of the BBC's secret nuclear bunker.

http://www.independent.co.uk/news/media/tv-radio/the-bbc-bunker-they-dont-want-you-to-know-about-2121187.html

Freddie Mac Says Net Loss $4.1 Billion

Freddie Mac, the second-largest provider of U.S. residential mortgage funding, on Wednesday said ongoing weakness in housing resulted in a $4.1 billion third-quarter net loss and another draw from the Treasury to maintain positive net worth.

Costs may increase "significantly" as snags in the foreclosure processes at major loan servicing companies increase delays in working with troubled borrowers and selling properties, it warned.


http://www.foxbusiness.com/markets/2010/11/03/freddie-mac-says-net-loss-billion/

30 Reasons Why People Should Be Getting Really Nervous About The State Of The U.S. Economy

http://theeconomiccollapseblog.com/archives/30-reasons-why-people-should-be-getting-really-nervous-about-the-state-of-the-u-s-economy

Caught In A Lie: Bernanke Promised Congress The Federal Reserve Would Not Monetize The Debt But Now That Is Exactly What Is Happening

On June 3rd, 2009 Federal Reserve Chairman Ben Bernanke promised the U.S. Congress that the Federal Reserve would not monetize the debt of the U.S. government. On November 3rd, 2010 the Federal Reserve announced a massive quantitative easing plan which will involve the purchase of 600 billion dollars of U.S. Treasury securities by the middle of 2011. Creating 600 billion dollars out of thin air and using them to buy up U.S. government securities is monetizing the debt. So Federal Reserve Chairman Ben Bernanke has been caught in a lie. Will we ever be able to trust a single word that he says ever again?

http://theeconomiccollapseblog.com/archives/caught-in-a-lie-bernanke-promised-congress-the-federal-reserve-would-not-monetize-the-debt-but-now-that-is-exactly-what-is-happening

U.S. home prices expected to slide another 8%

Nevertheless, the housing market still faces many problems: a weak economy, sluggish hiring, tight mortgage underwriting, falling home prices, and slowing sales.

http://finance.yahoo.com/news/US-home-prices-expected-to-cnnm-28872967.html?x=0&sec=topStories&pos=2&asset=&ccode=

How Western Powers May Have Blown It

QE2 risks currency wars and the end of dollar hegemony ... As the US Federal Reserve meets today to decide whether its next blast of quantitative easing should be $1 trillion or a more cautious $500bn, it does so knowing that China and the emerging world view the policy as an attempt to drive down the dollar. The Fed's "QE2" risks accelerating the demise of the dollar-based currency system, perhaps leading to an unstable tripod with the euro and yuan, or a hybrid gold standard, or a multi-metal "bancor" along lines proposed by John Maynard Keynes in the 1940s. China's commerce ministry fired an irate broadside against Washington on Monday. "The continued and drastic US dollar depreciation recently has led countries including Japan, South Korea, and Thailand to intervene in the currency market, intensifying a 'currency war'. In the mid-term, the US dollar will continue to weaken and gaming between major currencies will escalate," it said. – UK Telegraph

http://www.thedailybell.com/1498/How-Western-Powers-May-Have-Blown-It.html

Quantitative Easing is Economic Suicide

The question being asked all across the world of business news is: Will QE2 be successful? Because this policy is literally economic suicide, the question becomes: Will the Federal Reserve be successful in the assisted economic suicide of the U.S. government? I find this an utterly appalling question -- which highlights the intellectual bankruptcy of government policymakers and the bankers who goad them onward.

http://www.realclearmarkets.com/articles/2010/11/03/quantitative_easing_is_economic_suicide_98740.html

Risk of Inflation, Potential 'Commodity Shock'

Rising inflation in emerging markets, coupled with marked increases in commodity prices, could hurt developed economies, as companies struggle to keep input costs down while seeing precious investment dollars heading overseas, analysts told CNBC.

http://www.cnbc.com/id/39984721

Opium Wars Revisited: Will China Corner The Gold Market?

http://blogs.forbes.com/investor/2010/11/02/opium-wars-revisited-will-china-corner-the-gold-market/

Food Sellers Grit Teeth, Raise Prices

Packagers and Supermarkets Pressured to Pass Along Rising Costs, Even as Consumers Pinch Pennies

Prices of staples including milk, beef, coffee, cocoa and sugar have risen sharply in recent months. And food makers and retailers including McDonald's Corp., Kellogg Co. and Kroger Co. have begun to signal that they'll try to make consumers shoulder more of the higher costs for ingredients.

http://online.wsj.com/article/SB10001424052748704506404575592313664715360.html?mod=WSJ_hp_LEFTWhatsNewsCollection

Gold, silver surge as Fed move punishes dollar

Gold futures surged to a record close Thursday after investors used the U.S. Federal Reserve’s new $600 billion quantitative-easing program as a fresh reason to sell the U.S. dollar.

http://www.marketwatch.com/story/gold-rallies-as-price-drop-lures-investors-2010-11-03

Fed's Lockhart: Quantitative easing must be big

Atlanta Federal Reserve Bank President Dennis Lockhart said on Tuesday that further easing by the Fed has to be large enough to help boost demand, and purchases of $100 billion of securities a month would be a possibility.

http://www.reuters.com/article/idUSTRE69E28A20101019

China Plans to Reduce Its Exports of Minerals

HONG KONG — The Chinese government plans a further reduction, of up to 30 percent, next year in its quotas for exports of rare earth minerals, in an attempt to conserve dwindling reserves of the materials, the official newspaper China Daily said Tuesday.

http://www.nytimes.com/2010/10/19/business/global/19mineral.html?_r=3&partner=rss&emc=rss

The 19 Countries Most Likely To Default: Ireland Surges Higher

Ireland's bank bailout and the failure of its austerity budget has been the big sovereign debt story since September.

This country's place on CMA Datavision's cumulative probability of default rankings has spiked as from 14th place in July, to 5th place by the end of Q3.

http://www.businessinsider.com/19-countries-most-likely-to-default-2010-10

27 Signs That The Standard Of Living For America’s Middle Class Is Dropping Like A Rock

Very Interesting

Meanwhile, the U.S. economy is being rapidly assimilated into the emerging one world economy.

http://beforeitsnews.com/story/205/391/27_Signs_That_The_Standard_Of_Living_For_Americas_Middle_Class_Is_Dropping_Like_A_Rock.html

Wal-Mart ends profit sharing with employees

Wal-Mart Stores Inc., the nation's largest private employer, plans to end automatic profit-sharing contributions for its employees in a revamp of its benefits package that it says will give workers more chance to share in its financial success.

The discounter will replace profit-sharing starting in February with retirement plan contributions of up to 6 percent of pay -- as long as workers sign up and contribute an equal amount, Wal-Mart said in a memo it provided The Associated Press late Friday.

http://finance.yahoo.com/news/WalMart-ends-profit-sharing-apf-3150722021.html?x=0

Three Horrifying Facts About the US Debt “Situation

This sums it up...financial death spiral. No way out...

http://www.zerohedge.com/article/three-horrifying-facts-about-us-debt-%E2%80%9Csituation%E2%80%9D

Doug Casey on the Violence of the Storm, the Destruction of the Middle Class and the Coming Gold Standard

http://www.thedailybell.com/1436/Doug-Casey-on-the-Violence-of-the-Storm-the-Destruction-of-the-Middle-Class-and-the-Coming-Gold-Standard.html?bcsi_scan_24DE46460B4E2EF0=Qe4DXLzF2Bhsxfu0B8FN9Fy2ArADAAAAXF99AQ==&bcsi_scan_filename=Doug-Casey-on-the-Violence-of-the-Storm-the-Destruction-of-the-Middle-Class-and-the-Coming-Gold-Standard.html

Far More Derivative Exposure Today Than Two Years Ago

Harold Bradley, chief investment officer for the Kauffman Foundation, discusses the increase in derivatives held by commercial banks with CNBC's Maria Bartiromo and Herb Greenberg.

http://www.realclearpolitics.com/video/2010/10/06/kauffman_foundations_harold_bradley_risks_from_derivatives_look_terrifying.html

Investors see silver lining in economic gloom

Silver prices have risen 31pc in 2010 to a 30-year high, outperforming gold, equities and most base metals. On Tuesday, the gold-silver ratio dropped below 60 for the first time in 11 months.

The ratio varies wildly. In 1970, it was about 20 and it peaked at just under 100 in 1991. The average is around about 40 – and that is the key to any silver bull's argument. Historically, it appears that silver is undervalued in relation to gold, they argue.

In 2010, the ratio has been as high as 72, recorded in February, and is now just below 60. Many believe it could have further to fall.

http://www.telegraph.co.uk/finance/markets/8039595/Investors-see-silver-lining-in-economic-gloom.html

Base metals are more precious by the week

Why are tin, copper, lead, zinc, aluminium and nickel so expensive at the moment and is the general base metals rally sustainable?

http://www.telegraph.co.uk/finance/markets/marketreport/8053986/Base-metals-are-more-precious-by-the-week.html

Gold coins and quantitative easing

Governments keep printing more money, hoping to ignite an economic barbeque. But cheap cash – also known as quantitative easing – burns more like a highway flare. You want slow-burning, steady value? That's gold, not greenbacks.

http://www.csmonitor.com/Business/The-Daily-Reckoning/2010/1011/Gold-coins-and-quantitative-easing

Poor Crops, Soaring Demand, Currency Wars: A Recipe for Food Shortages

Prices for agricultural commodities spiked so much on Oct. 8 that they triggered daily movement limits on the Chicago exchange. Options markets saw prices for commodities like corn soar more than 13% during the day following reports of supply shortages around the world.

Commodity-oriented exchange-traded funds like the PowerShares DB Agriculture (DBA) leaped as well. The ETF surged almost 10% over the previous week, with more than 6% of the gains registered on Friday alone.

http://www.dailyfinance.com/story/poor-crops-soaring-demand-currency-wars-a-recipe-for-food-sho/19667693/

Finance Chiefs Fail to Resolve Currency Spat as G-20 Splits

Leaders of the world economy failed to narrow differences over currencies as they turned to the International Monetary Fund to calm frictions that are already sparking protectionism.

Exchange rates dominated the IMF’s annual meeting in Washington on concern that officials are relying on cheaper currencies to aid growth, risking retaliatory devaluations and trade barriers. China was accused of undervaluing the yuan, while low interest rates in the U.S. and other rich nations were blamed for flooding emerging markets with capital.

http://www.bloomberg.com/news/2010-10-10/global-finance-chiefs-fail-to-resolve-exchange-rate-spat-as-g-20-splinters.html

Fed Undaunted by Uncertain Prospects for Money Printing

The U.S. Federal Reserve runs the risk of diminishing returns from its next round of money printing to amplify the subdued economic recovery, but that won't stop it from trying.

Minutes due Tuesday from the Fed's most recent policy-setting meeting may reflect some divisions among officials over whether to launch another round of asset purchases, known as quantitative easing.

http://www.cnbc.com/id/39604937

Dollar set for sharp decline, Goldman forecasts

The dollar will embark on a sharp decline over the next 12 months, Goldman Sachs forecast on Wednesday, as policy makers in Washington look poised to press the trigger on another round of printing money.

http://www.telegraph.co.uk/finance/currency/8047468/Dollar-set-for-sharp-decline-Goldman-forecasts.html

The Top-10 Budget-Deficit Time Bombs

If you've read the press releases being put out by Washington these days, you'd be convinced that the big bad Bush-caused recession of 2008-2009 is now safely beyond us.

Tain't so.

If fact, the hoary mess which began under the last days of Bush & Democrats guarantees that Obama & Democrats will continue to take us down the rat-hole of national bankruptcy.

http://www.humanevents.com/article.php?id=35666

U. S. Treasury Department report to Congress: U.S debt to rise to $19.6 trillion by 2015

GREAT SITE

http://www.federalbudget.com/

Lear Capital: Origin of Gold vs. Silver Ratio

Discussed more and more, as silver prices rally, is the ratio in value of silver to gold. Currently sitting at 60 ounces silver being equal to 1 ounce gold, some say that ratio is headed much lower. Why the optimism? Perhaps history explains.

http://blog.learcapital.com/blog/lear-capital/0/0/lear-capital-origin-of-gold-vs-silver-ratio

David Morgan: Silver Overdone Now, But Headed Higher in 2011

Gold's record highs might steal all the headlines, but savvy investors know the real story lies in silver, where futures for December delivery topped $22/oz earlier this week—their highest levels in 30 years.

http://seekingalpha.com/article/229059-david-morgan-silver-overdone-now-but-headed-higher-in-2011?source=yahoo

Middle Class Slams Brakes on Spending

Middle-class Americans made their deepest spending cuts in more than two decades, slashing spending on such discretionary items as restaurant meals and alcohol during the recession.

Households in the middle fifth of the population sliced their average annual spending to $41,150 in 2009, the Labor Department said Tuesday in its annual spending breakdown. That was down 3.1% from 2007 and 3.5% from 2008, the steepest one-year drop since records began in 1984. The drop came even as those households' after-tax income remained relatively stable over the two years, at an average $45,199

http://online.wsj.com/article/SB10001424052748703298504575534341401915382.html?mod=WSJ_hpp_MIDDLETopStories

Soaring prices threaten new food crisis

Fears of a global food crisis swept the world’s commodity markets as prices for staples such as corn, rice and wheat spiralled after the US government warned of “dramatically” lower supplies.

An especially hot summer in the US, droughts in countries including Russia and Brazil and heavy rain in Canada and Europe have hit many grain and oilseed crops this year. This has raising concern of a severe squeeze in food supplies and a repeat of the 2007-08 food crisis.

EDITOR’S CHOICE
Lex: Commodities: self-defeating rally? - Oct-08In depth: Global food crisis - Oct-08Wheat and corn rise as Ukraine limits exports - Oct-07Russia put to the test by grain shortage - Oct-04Japan faces food pressure from China - Oct-04beyondbrics: Food file - Oct-05The US Department of Agriculture, in a closely watched report, predicted that the country’s stocks of corn would halve to their lowest levels in 14 years.

http://www.ft.com/cms/s/0/12b06cee-d300-11df-9ae9-00144feabdc0.html

Dollar Falls Below 82 Yen for First Time Since 1995

The greenback was headed for a fourth weekly decline against the euro in the longest stretch of losses since December 2008 as investors speculated the Federal Reserve will debase the currency by stepping up purchases of government debt. The yen and Swiss franc rose today versus most major counterparts as investors sought easily traded alternatives to the dollar.

http://www.bloomberg.com/news/2010-10-08/dollar-falls-below-82-yen-for-first-time-since-1995-on-u-s-payroll-report.html

Chris Hedges: Zero Point of Systemic Collapse

We stand on the cusp of one of humanity’s most dangerous moments.

https://www.adbusters.org/magazine/88/chris-hedges.html

87% of cities are Less Able to meet fiscal needs compared to last year

Frightening Charts Show Record Low Revenue, Worst-Ever Austerity Measures For US Cities

http://www.businessinsider.com/record-low-revenue-record-austerity-measures-for-us-cities-2010-10#87-of-cities-are-less-able-to-meet-fiscal-needs-compared-to-last-year-1

$162 million in stimulus funds not disclosed

WASHINGTON — Recovery.gov promised transparency on how the government spends every dollar of stimulus money, but there's $162 million the website doesn't disclose.
Recipients of 352 federal stimulus contracts, grants and loans have failed to report how they spent the money, the status of their projects or how many jobs were funded, according to the Office of Management and Budget (OMB).

http://www.usatoday.com/news/washington/2010-10-06-stimulus06_ST_N.htm

Fed Officials Mull Inflation as a Fix

The Federal Reserve spent the past three decades getting inflation low and keeping it there. But as the U.S. economy struggles and flirts with the prospect of deflation, some central bank officials are publicly broaching a controversial idea: lifting inflation above the Fed's informal target.

The rationale is that getting inflation up even temporarily would push "real" interest rates—nominal rates minus inflation—down, encouraging consumers and businesses to save less and to spend or invest more.

http://online.wsj.com/article/SB10001424052748704689804575536391713801732.html?mod=WSJ_hpp_LEFTWhatsNewsCollection

Goldman Sachs Says U.S. Economy May Be `Fairly Bad'

“We see two main scenarios,” analysts led by Jan Hatzius, the New York-based chief U.S. economist at the company, wrote in an e-mail to clients. “A fairly bad one in which the economy grows at a 1 1/2 percent to 2 percent rate through the middle of next year and the unemployment rate rises moderately to 10 percent, and a very bad one in which the economy returns to an outright recession.”

http://www.bloomberg.com/news/2010-10-06/oldman-sachs-says-u-s-economy-to-be-fairly-bad-recession-is-possible.html

Fear undermines America’s recovery

http://www.ft.com/cms/s/0/4524339a-d17a-11df-96d1-00144feabdc0.html

The State of Silver: Metal's price has widespread impact

Ted Binion, the eccentric son of legendary casino owner Benny Binion, was right: Silver is a good store of wealth.

Binion hid several million dollars worth of silver coins in an underground vault in Pahrump. Rick Tabish and two others were arrested while trying to steal the treasure after Binion died in 1998. Tabish and Binion's girlfriend, Sandy Murphy, later were convicted of murder and found innocent in a second murder trial, but both were convicted in the silver theft.

http://www.lvrj.com/business/the-state-of-silver-104401593.html

Rumours aside, something big is about to happen04Oct10

As I type this, a flurry of activity is taking place within security and financial circles around the world. Normally, this would signify just another busy day in the hard-working quarters of modern defence and finance, however this time there is good reason to suspect that the world may be about to witness something historic.

http://bretthenebery.wordpress.com/2010/10/04/rumours-aside-something-big-is-about-to-happen/

How the Housing Crisis Will End the U.S.A. as We Know It

http://johngaltfla.com/blog3/2010/10/05/how-the-housing-crisis-will-end-the-u-s-a-as-we-know-it/?bcsi_scan_24DE46460B4E2EF0=zs/Hf+cvl0P4w6U0ZPzotZoixyYBAAAA43xcAA==

Perth Mint

DEMAND for gold investment products at the Perth Mint has risen as much as 25 per cent in the past month.

http://www.theaustralian.com.au/business/perth-mint-inundated-as-gold-price-soars/story-e6frg8zx-1225934058127

The Fed is dead, maybe by 2012

OK, so Nassim Nicholas Taleb, the “Black Swan” author, actually said: “The Fed won’t exist in 25 years.” Warning: It’ll happen much sooner, fallout of the coming Second American Revolution.

http://www.marketwatch.com/story/the-fed-is-dead-maybe-by-2012-2010-10-05

Buying Gold Before the “Blow Off Phase”

An interesting graph of “a useful road map to any secular bull market” appeared in Casey’s Daily Dispatch. It was a graph showing how investment interest in a developing bubble classically proceeds through four stages.

http://dailyreckoning.com/buying-gold-before-the-blow-off-phase/

$460B Shadow Inventory Will Take 41 Months to Clear

Um---yeah if the economy starts again. If there are no jobs nobody will be buying houses.

http://www.dsnews.com/articles/sp-460b-shadow-inventory-will-take-41-months-to-clear-2010-09-29

Stocks surge to 5-month highs on Japan, services

U.S. stocks rallied right out of the gate and continued to surge Tuesday, with all three major indexes gaining about 2% and finishing at their highest levels since May. Investors welcomed a surprise move by the Bank of Japan to cut its key lending rate, as well as improved data for the U.S. service sector.

http://money.cnn.com/2010/10/05/markets/markets_newyork/index.htm?hpt=T2

ALL metals JUMPED BIGTIME yesterday

Gold UP $25.60 to $1340.60/oz
Silver UP $1.00 to $22.87/oz
Copper UP 0.0506
Zinc UP 0.0359
Nickel UP 0.3416

LETS HOPE SO

Pelosi's vote to adjourn could be her last hurrah

http://www.washingtonexaminer.com/politics/Pelosi_s-vote-to-adjourn-could-be-her-last-hurrah-1072704-104165973.html

Super-rich investors buy gold by ton

The world's wealthiest people have responded to economic worries by buying gold by the bar -- and sometimes by the ton -- and by moving assets out of the financial system, bankers catering to the very rich said on Monday.

http://www.reuters.com/article/idUSTRE6932NR20101004

Obama’s promise to end tax cuts for rich unravels

Nobody in Washington has put it quite so bluntly. But it seems almost certain now that Barack Obama will be unable to fulfil his pledge of reversing George W. Bush’s tax cuts for the wealthiest Americans. Last week, Democratic lawmakers returned home to prepare for next month’s midterm elections having failed in either chamber even to put the issue to a vote.

http://www.ft.com/cms/s/0/4931a1f8-cfee-11df-bb9e-00144feab49a.html

Health Care Suit Tests Basic Principles

As arguments begin Tuesday in a Florida District Court where 20 state attorneys general and the National Federation of Independent Business are challenging the constitutionality of the health care law, the American people can be forgiven for feeling a bit ill at ease about the direction their country is going. James Madison would feel the same way.

http://www.aolnews.com/opinion/article/opinion-health-care-lawsuit-tests-basic-constitutional-principles/19631832

IMF admits that the West is stuck in near depression

If you strip away the political correctness, Chapter Three of the IMF's World Economic Outlook more or less condemns Southern Europe to death by slow suffocation and leaves little doubt that fiscal tightening will trap North Europe, Britain and America in slump for a long time.

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/8039789/IMF-admits-that-the-West-is-stuck-in-near-depression.html

World Economy Decoupling From U.S.

Just three years since America began dragging the world into its deepest recession in seven decades, Goldman Sachs Group Inc., Credit Suisse Holdings USA Inc. and BofA Merrill Lynch Global Research are forecasting that this time will be different. Goldman Sachs predicts worldwide growth will slow 0.2 percentage point to 4.6 percent in 2011, even as expansion in the U.S. falls to 1.8 percent from 2.6 percent.

Underpinning their analysis is the view that international reliance on U.S. trade has diminished and is too small to spread the lingering effects of America’s housing bust. Providing the U.S. pain doesn’t roil financial markets as it did in the credit crisis, Goldman Sachs expects a weakening dollar, higher bond yields outside the U.S. and stronger emerging-market equities.

http://www.bloomberg.com/news/2010-10-03/world-economy-decoupling-from-u-s-in-slowdown-returns-as-wall-street-view.html

Enjoying the Weak Dollar? You Could Live to Regret It

Last week's Federal Reserve pledge to keep pumping money into the US economy was interpreted to mean future policies that would weaken the US currency. That in turn set off a wave of dollar selling that has been accompanied by a modest rise in stocks, new historical highs in gold and a substantial drop in Treasury yields.

http://www.cnbc.com/id/39420847

Is The Federal Reserve Out Of Control?

Back in March 2009, the Federal Reserve announced that it would purchase $1.7 trillion worth of U.S. Treasuries and mortgage-backed securities over the next 6 to 9 months. That was the first round of quantitative easing and Fed officials believe that it helped the U.S. economy avoid an even worse downturn.

But now Federal Reserve officials are talking about making quantitative easing a regular thing.

http://theeconomiccollapseblog.com/archives/is-the-federal-reserve-out-of-control-markets-across-the-globe-brace-for-impact-as-the-federal-reserve-powers-up-the-printing-presses

Peak Gold Is Upon Us

These are heady inflows into such a small space. All of the gold mined in human history, from King Solomon’s mines to the bars still in Swiss bank vaults bearing Nazi eagles (I’ve seen them) would only fill 2.5 Olympic sized swimming pools. That amounts to 5.3 billion ounces, about $6.3 trillion at today’s prices. For you trivia freaks out there, that is a cube with 65.5 feet on an edge.

http://www.zerohedge.com/article/peak-gold-upon-us