Best of the Week
Most Popular
1.Putin’s World: Why Russia’s Showdown with the West Will Worsen - John_Mauldin
2. Stocks Bull Market Grinds Bears into Dust, Is Santa Rally Sustainable? - Nadeem_Walayat
3. Gold and Silver 2015 Trend Forecasts, Prices to Go BOOM - Austin_Galt
4.Gold Price Golden Bottom? - Toby_Connor
5.Gold Price and Miners Soar on Huge Volume - P_Radomski_CFA
6.Stock Market and the Jaws of Life or Death? - Rambus_Chartology
7.Gold Price 2015 - EWI
8.Manipulated Stock Market Short Squeezes to Another All Time High - The China Syndrome - Nadeem_Walayat
9.Gold, Silver, Crude and S&P Ending Wedge Patterns - DeviantInvestor
10.Is the Gold And Silver Golden Rule Broken? - Michael_Noonan
Last 5 days
Gold Stocks to Shine in 2015 - 19th Dec 14
Why Alibaba Stock Shares Are a Screaming Buy - 19th Dec 14
China, Dollar, Japan, Europe Burning Questions for 2015 - 19th Dec 14
U.S. Economy is in a Sweet Spot! - 19th Dec 14
US Dollar and the Gold Fairy Tale - 19th Dec 14
Show Me The Money (Flow)! Tracking Money-Flow Through Value Shifts In Stock Markets - 19th Dec 14
The Commodities Market Is Not Dying, It’s Just Hibernating - 19th Dec 14
The Price Of Gold And The Art Of War - 18th Dec 14
Euro Succumbs to ECB QE Expectations and FOMC - 18th Dec 14
John Williams: A Downhill Run for the U.S. Dollar in 2015 - 18th Dec 14
Outrage at Taliban Islamic Fundamentalists Massacre of 132 Pakistani School Children in the Name of God - 18th Dec 14
How Inflation Changes Retirement Benefit Choices - 17th Dec 14
The Real Reason It's Tough to Beat the Stock Market - 17th Dec 14
Russian Currency Crisis and Debt Defaults Could Create Contagion in West - 17th Dec 14
How to Profit From Russia's Stock Market Crash - 17th Dec 14
Russia Crisis - If You Put Your Money in the Bank Will You Get it Back? - 17th Dec 14
Crude Oil Price Crash, U.S. Employment and Economic Growth - 17th Dec 14
Opposing Forces At Play In Gold and Silver Precious Metals Complex - 17th Dec 14
Wall Street Will Always Find An Excuse For Not Raising U.S. Interest Rates - 17th Dec 14
Torture, Terror And Elite Schizophrenia In The UK - 16th Dec 14
Eurozone Conflict Will Bring a Major Stocks Buying Opportunity - 16th Dec 14
Viewing Russia From the Inside - 16th Dec 14
Gold and Silver Stocks Bottom - Are We There Yet? - 16th Dec 14
The Financial Industry Pigmen Win Again - 16th Dec 14
Crude Oil Price Epic Blowout - 16th Dec 14
Asian Stocks Markets: Sand In The Gears Of The Bull Market - 16th Dec 14
U.S. Dollar Trend Forecast 2015 - Video - 16th Dec 14
Silver Price Bottom? - 15th Dec 14
Gold Price Base Building Bullish Pattern - 15th Dec 14
Stock Market Probable Pop-n-Crash Today - 15th Dec 14
Stock Market Time for a Bounce - 15th Dec 14
Stock Market Euphoria: The Mother of All Ponzi Schemes - 15th Dec 14
Gold - The Weight of Time as Trend - 15th Dec 14
U.S. Dollar Collapse? USD Index Trend Forecast 2015 - 14th Dec 14
The Rushing Stocks Bear Market and How to Prepare - 14th Dec 14
Gold and Silver Dreaming of a White Christmas - 14th Dec 14

Free Instant Analysis

Free Instant Technical Analysis


Market Oracle FREE Newsletter

Dramatic Stock Market Selloff

Surmounting the Gold Confiscation or Financial Collapse Scenario

Stock-Markets / Financial Markets 2010 Sep 10, 2010 - 02:23 PM GMT

By: DeepCaster_LLC

Stock-Markets Best Financial Markets Analysis Article“It is absurd that the United States has a central bank that is more accountable to the financial industry than it is to the public.”

“The Rally against Obamacare for the Banks” Dean Baker, The Guardian, 9/23/09

“…Only liquidation of the biggest banks can enable a recovery, period!! Of course, the process is complicated, especially politically. Actually, it is more than political, since the big banks control the USGovt. The response reaction from gold & silver will give loud messages to systemic failure, as money is wasted, invested in failure, and directed to the elite troughs…

The major 100 banks in the US are almost without exception insolvent, and thus do not lend. Sure, they boast a positive book value, but only after given permission to use phony FASB accounting rules. They can declare their assets at any value they wish. In fact, on many debt securities, they actually declare unrealized losses as gains…The FDIC came out this week to announce the Q2 list of problem banks went from 775 in number to 829…The main thrust of the limp activity is monetary creation, banker welfare, absurd programs, and war spending…

The American Intl Group episode was disguised from its true nature as a Goldman Sachs bailout. In fact, the record has been somewhat clearly told that the AIG nationalization enabled GSax to be first in line for credit default contract redemptions, at full price. They saved $11 billion in the nationalization and butting in line. There are advantages to acting as the USDept Treasury administrator. Many other big banks had favorable redemptions on similar insurance contracts. The wreckage of the entire US banking sector was thus covered up from the insurance perspective, preventing a credit derivative blowup

The Fannie Mae episode was one best described as averting either a mortgage bond default or a severe jump in mortgage rates emanating from the sewage treatment plant. In pulling off the nationalization of the wretch, the Wall Street controllers thus placated a crucial angry mortgage creditor. China

For vivid indications of failure, notice the slide into recession even after 20 months of near 0% official interest rate. The USFed has no more weapons except the Printing Pre$$... The ultimate problem is insolvency laced like cancer throughout the entire system, from housing, to households, to banks, to government fiscal situation, even to industry (long gone). The USFed cannot treat insolvency. Only liquidation can… The US bankers who have run the land for two decades have run out of asset bubbles to blow. Each growth period of 5 to 7 years has been driven by the next asset bubble in sequence, not industrial development or output…

Plain language works best at this point. The USGovt, as demonstrated by its nationalizations, big bank rescues, grand aid packages (car industry), and support of extreme measures, has invested heavily in failure, fraud, and banker elite welfare otherwise called pillage. They also have invested in sacred wars at great cost. The USGovt has not invested much at all in business, jobs, family, and life. The flimsy shallow vacant home loan programs exemplify the lack of support and aid for the public…

The failure pertains to the US financial sector in its entirety, from banking system to credit market. The failure is exacerbated by wasted expenditures toward what are called rescues and stimulus, but is actually banker welfare payouts… We are witnessing a syndicate in survival mode, in a desperate quest to save the system they exploit so thoroughly…

The extreme usage of the Printing Pre$$ in the next round of Quantitative Easing, dubbed QE2, will set up crippling explosions…

The worldwide recession will keep the crude oil price subdued until the USTreasury bubble pops. Then, at that time, several major commodity hedges will jump in price… An inflationary depression lies dead ahead!...

The secret to a legitimate solution is easy. The big banks must write down their credit portfolios, and accept deep losses. If that results in liquidation, so be it!!... The Zombie Big Banks threaten the entire system. If truth be told, they control the leadership of the USGovt itself. Dead entities control the USGovt, lodged in a stranglehold!!...

However, they control the USGovt, its finance ministry in the USDept Treasury, and the USDollar Printing Pre$$ itself. The big banks will NOT order their own death warrant, and face the financial gallows… Capitalism demands their plowing under to unleash hidden potential

The ball & chain dragging down and keeping down the big banks is the housing market. The downward force of gravity is visible in the falling home prices… Other commodities will be sacrificed in wholesale form in order to purchase energy and precious metals. Energy is needed for commercial survival, while gold is needed as bonafide safe haven for money…

The new debt, delivered as fresh paper, acts like acid on the capital base of the entire USEconomy…

A river of hyper-inflation is lodged in the USTBond dam, whose walls are nothing more than paper reeds held together by bad verbal glue, uttered by bank leaders who increasingly lack credibility…”

“Gold & Investment in Failure” Jim Willie CB, GoldenJackass.com, 9/1/10

“Are we witnessing the slow but certain death of cash in this generation? Is a truly cashless society on the horizon? Legislation currently pending in the Mexican legislature would ban a vast array of large cash transactions, but the truth is that Mexico is far from alone in trying to restrict cash. All over the world, governments are either placing stringent reporting requirements on large cash transactions or they are banning them altogether. We are being told that such measures are needed to battle illegal drug traffic, to catch tax evaders and to fight the war on terror. But are we rapidly getting to the point where we will have no financial privacy left whatsoever? Should we just accept that we have entered a time when the government will watch, track and trace all financial transactions? Is it inevitable that at some point in the near future ALL transactions will go through the banking system in one form or another (check, credit card, debit card, etc.)?”

“The Death Of Cash? All Over The World Governments Are Banning Large Cash Transactions” Economic Collapse Blog, 8/30/10

The claim that several international Mega-Banks are insolvent but for Mark-to-Model (more accurately, Mark-to-Myth) Accounting, may well be true.

And it certainly is true that several would have been Insolvent were it not for Taxpayer – funded multi-hundred billion dollar Bailouts.

Indeed, generally speaking, the taxpayers of the U.S. and Eurozone have ultimately been saddled with the bulk of the Toxic Assets (in the U.S. Courtesy of the private-for-profit Fed), while the Mega-Banks are left with a combination of Toxic Assets and Performing Assets, such as they are.

This much is history. But the Main and Present Problem which we address here is The Issue of how Excessive, and probably unpayable multi-Trillion Dollar (Pound, Euro, etc.), Public and many Private Debts finally gets resolved and how investors can prepare to protect, and profit, NOW, before more Crises and their Toxic Fallout.

The Reality is that much Public (and Private) Debt is unpayable without currency Devaluation or Default. For example, an estimate of U.S. Public Obligations reveals that the one year U.S. Budget Deficit alone is $13 Trillion and to that must be added downstream unfunded liabilities which range from $100 to $200 Trillion depending on whose estimates one believes. Given this range, does the exact amount matter? It is unpayable.

Worse still, Major Sovereign Nations are still leveraging up by piling on more and more debt. In the U.S., the private for-profit Fed prints money for free and lends it to the U.S. Taxpayers with interest.

And while the Private Sector is deleveraging, it is not healthy, Unemployment is not abating and the housing market is not recovering!

And to whom is most of this Public and Private Debt owed? Answer: Mainly to the International Mega-Banks (the same ones who got us into this Financial fix via their pro-bubble credit policies). Hold that important thought. We shall return to it.

For most Major Sovereign Nations Default is not a likely option (though some like Greece may be forced into it). Much more likely is Currency Devaluation of e.g. the Purchasing Power of the U.S. Dollar and Euro and British Pound e.g. via the printing press.

Of course this works a huge hardship on Savers and Retirees and Investors, as it is a de facto Confiscation of their hard-earned assets.

And there is another Confiscation brewing. The “U.S. Depts. Of Labor and Treasury Schedule Hearing on Confiscation of Private Retirement Accounts” P.A. Heller’s recent headline on coinupdate.com reads.

Indeed the $6 Trillion or so in IRA’s and 401(k’s) is a juicy target indeed for the overly indebted U.S. This Confiscation would be effected by requiring Assets of IRA’s and 401k’s to be invested in U.S. Treasury Bond “Backed” Annuities.

Thus would the Confiscation be veiled.

But with Massive Ongoing Monetary Creation likely to result in dramatic devaluation of (U.S. for example) Treasury Securities’ value over the next few years, such Mandatory Conversion is a de facto Wealth Confiscation.

So with U.S. Dollar and Euro and Pound Devaluation (in terms of Purchasing Power) likely coming along with de facto Wealth Confiscation, what should an Investor do?

Investors-Citizens can either submit and allow their Financial future to be determined by the Mega-Bankers (and all the while suffering degradation of the Value of their Assets). OR

They can work to create Political and Financial Structures and Conditions which make a Real Recovery Possible.

Indeed, Jim Willie argues (above) that “Only liquidation of the biggest banks can enable a Recovery, Period.” Perhaps so.

In other words, Willie’s point appears to be that if the very biggest banks were allowed/forced to collapse (by e.g. requiring Mark-to-Market Accounting), the public and private debt owed to them would be eliminated…sort of.

Voila! A Fresh Start for Major Nations and Citizens.

The Course of standing supinely by while the purchasing Power of the U.S. Dollar (and other Major Fiat Currencies) is dramatically degraded, has many negative consequences addition to lost Retirement Assets and Savings. (But there is yet a Way to Profit and Protect which we sketch below.)

This “Option” of facilitating the U.S. Dollar (Pound, Euro, etc.) Degradation is, we have long maintained, a component of The Cartel’s* End Game for which, evidence increasingly indicates, they have long been planning (see Deepcaster’s articles cited below).

Indeed, The Fed-led Cartel’s* ‘End Game’ Juggernaut is Rallying Profitably Along – “profitably” to the Tune, for example, of a $11.8 Trillion gain for certain Mega-Financial Institutions in the last 6 months of 2008, when Equities Investors worldwide were losing Trillions in the Equities Markets Crash. (See The Central Banker’s Bank’s (The Bank for International Settlements) website www.bis.org (Path: Statistics>Derivatives>Table 19) and “Opportunities & Threats in Derivatives Shocker” (05/29/2009) in the ‘Articles by Deepcaster’ cache at www.deepcaster.com.)

These Massive Gains were doubtless “facilitated” by The Fed-led Cartel’s Interventional Regime which we describe in detail in the articles noted below. Indeed, there is clear and convincing evidence that The Federal Reserve leads a Cartel of key Central Bankers and favored Mega-Financial Institutions in an ongoing Regime of Overt and Covert Manipulation of the Precious Metals Equities, Strategic Commodities and other Markets, as we also demonstrate in the articles noted below.

*We encourage those who doubt the scope and power of Overt and Covert Interventions by a Fed-led Cartel of Key Central Bankers and Favored Financial Institutions to read Deepcaster’s December, 2009, Special Alert containing a summary overview of Intervention entitled “Forecasts and December, 2009 Special Alert: Profiting From The Cartel’s Dark Interventions - III” and Deepcaster’s July, 2010 Letter entitled "Profit from a Weakening Cartel; Buy Reco; Forecasts: Gold, Silver, Equities, Crude Oil, U.S. Dollar & U.S. T-Notes & T-Bonds" in the ‘Alerts Cache’ and ‘Latest Letter’ Cache at www.deepcaster.com. Also consider the substantial evidence collected by the Gold AntiTrust Action Committee at www.gata.org, including testimony before the CFTC, for information on precious metals price manipulation. Virtually all of the evidence for Intervention has been gleaned from publicly available records. Deepcaster’s profitable recommendations displayed at www.deepcaster.com have been facilitated by attention to these “Interventionals.” Attention to The Interventionals facilitated Deepcaster’s recommending five short positions prior to the Fall, 2008 Market Crash all of which were subsequently liquidated profitably.

Fortunately there are Steps which Investors worldwide can take to derail the Juggernaut, and Profit and Protect along the way.

Why derail the juggernaut, one may ask.

One answer is that the Fed-led Cartel’s policies appear to have resulted and to be resulting in a massive Wealth Transfer from Investors/Taxpayers around the world to the Fed-led Cartel and their favored financial institutions.

Of course, a key component of this Wealth Transfer involves debasing the value of the U.S. Dollar which, which HSBC has correctly noted primarily results from “the ultra-loose monetary policy of The “Federal Reserve”. Since The Fed was established in 1913 the U.S. Dollar has lost over 95% of its purchasing power, as reported by Rep. Ron Paul and others.

One of several negative consequences is that Investors who have saved (they thought) wealth in Dollars over a lifetime have seen the purchasing power of those dollars dramatically eroded by, for example, over 35% in the last 8 years alone, and the erosion continues.

Unfortunately, there is considerable evidence that “ultra-loose monetary” and credit policies, and the consequent housing credit crises and Market Crash were the result of the conscious policy of the Fed-led Cartel.

Consider the following observation by Harry Schultz:

“…what is the reason for this “seemingly random monetary mess that multiplies its momentum every day? The answer, in one word, control. The elite/insiders already have control of the financial system, but they wanted more, much more…and it was not random, it was planned.” (emphasis added)

“How will all the above manifest itself in your life? The answer: “All you own will shrink...your income, assets, net worth, will shrink year after year in real terms inflation adjusted and possibly also nominally.”

HS Letter, April 27, 2008

Harry Schultz, Eminence Grise of the Newsletter writing Fraternity sees the Threat to Profits and Wealth posed by the Fed-led Cartel* quite clearly.

The Cartel* ‘End Game’, as Deepcaster has named it, apparently involves Stealthily transferring ever more Wealth and Power to The Cartel at the expense of Investors/Citizens around the world. (For more details, see “Coping with the Superpower Cartel Threat” (1/30/09) in the ‘Articles by Deepcaster’ cache at www.deepcaster.com.)

In this connection we must consider F. William Engdahl’s contention that the 2008 Credit Crunch and Market Crash were planned: “…in every major U.S. financial panic…the titans of Wall Street…have deliberately triggered bank panics behind the scenes to consolidate their grip on U.S. Banking…”

As background to understanding the ongoing implementation of the Cartel’s Interventional Regime and “End Game” consider Engdahl’s position:

“…in every major US financial panic since at least the Panic of 1835, the titans of Wall Street – most especially until 1929, the House of JP Morgan – have deliberately triggered bank panics behind the scenes in order to consolidate their grip on US banking. The private banks used the panics to control Washington policy including the exact definition of the private ownership of the new Federal Reserve in 1913, and to consolidate their control over industry such as US Steel, Caterpillar, Westinghouse and the like. They are, in short, old hands at such financial warfare to increase their power.

Now they must do something similar on a global scale to be able to continue to dominate global finance, the heart of the power of the American Century.

That process of using panics to centralize their private power created an extremely powerful concentration of financial and economic power in a few private hands, the same hands which created the influential US foreign policy think-tank, the New York Council on Foreign Relations in 1919…”

“Behind the panic: financial warfare over future of global bank power” F. William Engdahl, October 10, 2008

Consider the implications of the F. William Engdahl quote regarding “global bank power.” As Engdahl points out, the evidence is increasing that the recent financial panic and economic distress is and has been pre-planned as a part of Cartel Strategy to increase power and, in our view, to implement its “End Game.”

In light of these considerations it is not surprising that the Mega-Banks were the first to be Saved in the 2008 financial crisis. That is, a Major Negative Consequence of the Fall, 2008 Market Crash was a Taxpayer Funded Financial bailout of several Key Mega-Banks. Yet the Bailouts allowed them to move on to subsequent great profitability.

Consider the case of Goldman-Sachs. Not only did Goldman receive billions in TARP funds (subsequently repaid) but they also received $11.9 billion via the AIG bailout, without having to take any ‘Haircut’ on their debased Assets.

One result was that Goldman survived and reportedly has paid an average of $500,000 plus to each employee in compensation.

Meanwhile, the U.S. Consumer/Taxpayer and often Investors/Mortgage Holder who is 70% of the U.S. Economy is left with Greater Debt (to fund the Bailouts) and interest payments on that debt to the private for-profit U.S. Federal Reserve. Goldman et.al, but for the bailouts, would have collapsed. But the U.S. Consumers-Taxpayer and Small Business Owners, however, have not been “saved” at all.

To understand the Cartel’s likely “End Game” we must understand the Root Cause.

The Root Cause of The ‘End Game’ Threat lies in the secrecy, structure, functioning and policies of the private-for-profit “U.S.” Federal Reserve.

Various international private banks, several of which are headquartered in Europe, own the “United States” Federal Reserve Bank. The European Banks were among the founding banks whose representatives, including Paul Warburg who wrote the charter at the Jekyll Island Georgia meeting, as documented in “The Creature from Jekyll Island”, by G. Edward Griffin.

These International Bankers, acting through their “U.S.” Fed, make money by creating money out of “thin air” as eloquently described by the Dean of the Newsletter Writers, Richard Russell:

“I still can’t get over the whole Federal Reserve racket.

Consider the following - - let’s take a situation where the U.S. government needs money. The U.S. doesn’t just issue United States Notes, which, of course it could. These notes would be dollars backed by the full faith and credit of the United States. No, the U.S. doesn’t issue dollars straight out of the U.S. Treasury.

This is what the U.S. does - - it issues Treasury Bonds. The U.S. then sells these bonds to the Fed. The Fed buys the bonds. Wait, how does the Fed pay for the bonds? The Fed simply creates money “out of thin air” (book-keeping entry) with which it buys the bonds. The money that the Fed creates from nowhere then goes to the U.S. The Fed holds the U.S. bonds, and the unbelievable irony is that the U.S. then pays interest on the very bonds that the U.S. itself issued. (With great profit to the private owners of The Fed - - Ed. Note) The mind boggles.

The damnable result is that the Fed effectively controls the U.S. money supply. The Fed is …not even a branch of the U.S. government. The Fed is not mentioned in the Constitution of the United States. No Constitutional amendment was ever created or voted on to accept the Fed. The Constitutionality of the Federal Reserve has never come before the Supreme Court. The Fed is a private bank that keeps the U.S. forever in debt - - or I should say in increasing debt along with ever rising interest payments.

How did the Fed get away with this outrage? A tiny secretive group of bankers sneaked through a bill in 1913 at a time when many in Congress were absent. Those who were there and voted for the bill didn’t realize (as so often happens) what they were voting for (shades of the shameful 2002 vote to hand over to President Bush the power to decide on war with Iraq).”

Richard Russell, “Richards Remarks,” dowtheoryletters.com, 3/27/07

After President Wilson signed the Federal Reserve Act into law in 1913, he reportedly said, “I am a most unhappy man, I have unwittingly ruined my country…a great industrial nation is now controlled by its system of credit…the growth of the nation, therefore, and all of our activities are in the hands of a few men…” Thus we have an early statement about the threat to “democracy” occasioned by The Fed.

Market Intervention, Data Manipulation & The Cartel “End Game”

As Richard Russell points out the creation of ever-increasing debt and interest payments is unsustainable. Thus there will inevitably be a Day of Reckoning, a Day which is fast approaching.

In order to “manage” the Economy and Financial System on its way to The Day of Reckoning (which, we reiterate, is coming mainly as a consequence of The Fed’s dramatic monetary inflation and earlier “easy credit” policies), and to implement its own ‘End Game’, the Fed-led Cartel* of Key Central Bankers and Favored Financial Institutions has created, and for the past several years has operated, an extraordinary “financial regime” built on dramatically increasing trillions of dollars (nearly $600 trillion as of December, 2008 - - see www.bis.org (path: statistics>derivatives>Table 19 and ff.) of Dark OTC Derivatives available for the manipulation of major markets ranging from Precious Metals to Crude Oil and Energy, to Equities and Strategic Commodities (see Deepcaster’s July, 2008 Letter at www.deepcaster.com).

To be sure The Cartel’s massive and increasing use of derivatives to intervene (Overtly and Covertly via Primary Dealers) in a wide variety of markets is fraught with danger (e.g. through actual and prospective counterparty failure as we are now seeing, as well as prospective Systemic Failure). Deepcaster, Warren Buffett and Jim Sinclair have pointed out the dangers of OTC derivatives. Indeed, Buffett calls them “toxic” … ”weapons of financial destruction” and Sinclair has aptly described the financial system as “sitting on a… trembling mountain of derivatives … think Weimar Republic.” Unfortunately, Deepcaster, Jim Sinclair, and Warren Buffett are correct.

The Crisis Intensifies – The “End Game” Implementation Begins

Indeed, the evidence indicates that The Cartel has developed a nefarious “End Game” plan, an overview of which we describe in our June, 2007 Letter “Profiting From the Push to Denationalize Currencies and Deconstruct Nations” and the August 13, 2006 Alert “Massive Financial-Geopolitical Scheme Not Reported by Big Media” posted in the “Archives” at www.deepcaster.com. Fortunately, a Bill was introduced in a recent session of the U.S. Congress (H.Con.Res.40), which opposes this nefarious scheme.

Nevertheless, consider the following key aspects of that ‘End Game’ that have been implemented through various departments of the U.S. government agencies and NGOs.

Data Manipulation

Masking the True State of the Economy and Financial Markets, is another aspect of The Cartel Regime – Data Manipulation.

Shadowstats.com calculates the Real Numbers for the U.S. the way they were calculated in the 1980’s and 1990’s, before systematic Official Data Distortion and Interventions began in earnest.

Official Numbers vs. Real Numbers (per Shadowstats.com)

Annual U.S. Consumer Price Inflation reported August 13, 2010

1.24% / 8.57% (annualized July 2010 Rate)

U.S. Unemployment reported September 3, 2010

9.6% / 22%

U.S. GDP Annual Growth/Decline reported August 27, 2010

2.98% / -1.25%

U.S. M3 reported September 4, 2010 (Month of August, Y.O.Y.)

No Official Report / - 4.32 %

Shadowstats.com calculates the numbers as they were calculated prior to the “gimmicking” of Official Statistics that became widely implemented beginning in the 1980s and early 1990s.

We emphasize, Real U.S. GDP “growth” is a negative number -- about a negative 1.25%, according to shadowstats.com, as opposed to Official Figures showing a positive 2.98%.

That the U.S. economy (about 25% of the international economy) is headed in the direction of Serious Stagflation (a Kondratieff Winter) is pretty clear from the very credible shadowstats.com statistics cited above. Predictions of Recovery any time soon are a combination of Media Hype and Fed “Communications policy”.

As well, the U.S. Dollar’s Purchasing Power has declined substantially in the past decade and it appears that The Cartel expects (and likely are even pushing) the U.S. Dollar to go into further and further decline, over the medium term, and to continue their other policies, until there is a “No-Salvation, No-Return Systemic Crisis.”

It would appear that The Cartel-charted-course toward a Stagflationary Recession/Depression, and thus toward the further implementation of their “End Game,” is on course. For more details on the ‘End Game’ see the articles referred to above.

Indeed, the official and Agency Data Manipulation serves to conceal painful Economic and Financial Realities from the public. One Reality that is still partially concealed is the consequences of the U.S. Dollar Destruction for the public.

The ongoing destruction of the U.S. Dollar’s purchasing power results in a de facto confiscation of retirees and Investors assets which typically took a lifetime (and indeed in some cases Generations) of wealth-building.

In addition to the de facto Power and Wealth Grabs of U.S. Dollar Destruction and Data Manipulation, The Fed continues to grab power in other Financial Arenas.

Clearly, the Congress’ and the Obama Administration’s recently enacted FinReg Bill further empowers The Fed (via e.g. the new power to regulate non-financial institutions) and in that respect is a recipe for disaster for Investors and citizens alike.

Fortunately and in light of all of the foregoing Deepcaster has developed a Strategy for Protecting Wealth as well as Profiting and notwithstanding near-term outcomes of the battle over Fed Power:

The Strategy – Guidelines for Identifying Opportunities for Profit and Protection

1. Get the Real Data. As many Investors suspect, Crucial Official Government and Agency Economic and Financial Data are of highly questionable validity. The Data set forth above from shadowstats.com is a good starting point as is data from Alternative Data Sources such as Deepcaster, Gold Anti-Trust Committee (www.gata.org), and shadowstats.com.

2. Take Account of both Overt and Covert Cartel Intervention. Many of these same investors who suspect Official Statistics also rightly suspect that the private-for-profit U.S. Federal Reserve and/or Central Banks overtly and covertly manipulate Major Markets. But they might not be aware that covert Market Interventions and Data Manipulation are likely far more pervasive than generally believed, as detailed in Deepcaster’s articles mentioned above.

As well, such investors may not have thought systematically about how one copes with and profits from such Intervention and Data Manipulation.

For example, in early March, 2008 Gold was over $1000/oz. when the Bear Stearns Crisis revealed the fragility of the Financial System. Gold should surely have skyrocketed then. Instead, it was brutally taken down. Were its price not manipulated, Deepcaster’s view is that its price would be over $3,000.00 per ounce today.

But there is a Profitable Refuge from Market Intervention and Data Manipulation. That Profitable Refuge lies in the Strategy described in the aforementioned Alert, certain characteristics of which we outline here:

3. Recognize that the “Buy and Hold” strategy rarely succeeds anymore. The Eminence Grise of Newsletter writers, Harry Schultz perhaps put it the best when he stated that “buy and hold no longer works anymore, even with Gold.” Recent Market Developments should suffice to demonstrate this principle!

Owners of The Dow stocks have seen no appreciation over the last decade, and have indeed suffered a 30% loss if Real Inflation is considered.

4. Track the Covert Interventionals as well as the Technicals and Fundamentals and Overt Interventionals. Tracking the Footprints, as it were, of the Covert Interventionals (e.g. the Repo and TSLF Pools) daily can often, but not always, give one excellent clues about The Cartel’s next likely Interventional Move - - such clues are essential to preserving wealth and making profits. Deepcaster’s tracking of The Interventionals, for example, allowed him to recommend five short positions going into September, 2008, (i.e. before the Market Crash) all of which he has subsequently recommended be profitably liquidated. Deepcaster’s article “Cartel Angst Equals Investor Advantage” (9/18/2009 can be found in the ‘Articles by Deepcaster’ at www.deepcaster.com) lays out a specific strategy for use in investing and trading in the heavily manipulated Gold and Silver Market.

5. Perhaps most important, be prepared to go both long and short Major Market Sectors - - long near the bottoms of Interim Takedowns and short near Sector Tops. The Interventionals are essential to helping identify these tops and bottoms. In Deepcaster’s view, it will be increasingly difficult to achieve a net profit for one’s portfolio if one is unwilling and/or unable to “go short” as well as “long”.

The Blossoming of the 200% and 300% (and other) leveraged ‘short’ and ‘long’ ETF’s described above provide a superb opportunity to go short and long with ease, but not, as we explain in recent articles, without risk.

6. Be aware of and Active in the overall Geopolitical Landscape in order to gain an adequate understanding of how that Landscape might affect the present and future direction of the Markets. It is essential that one understand the motivations of the major players in the market and the resources at their disposal.

For example, a Major Motivation of the U.S. Federal Reserve and other key Central Banks is the protection and enhancement of the legitimacy of their Treasury Securities and Fiat Currencies as Measures and Stores of Value. Therefore, one can understand that one of their Major Goals will be to attempt continually to de-legitimize Gold, Silver and the Strategic Commodities, including especially Crude Oil, as The Ultimate Stores and Measures of Value. With this in mind, the periodic takedowns of Gold and Silver prices and, since July, 2008, of the Crude Oil price, become understandable. Moreover, such an insight applied daily to the market can result in a tremendous edge in understanding market performance, present and future.

7. Finally, Hard Assets Partisans have the opportunity to become involved in Political Action to diminish the power of The Cartel. It is truly outrageous that the average unsuspecting citizen, and prospective retiree, can and does put his hard won assets in Tangible Assets and/or Retirement Accounts only to have those assets effectively de-valued by Cartel Takedowns, U.S. Dollar Devaluation and other Cartel actions. In order to help prevent this and similar outrages, we recommend taking three steps:

a) Become involved in the movement to Audit and then abolish the private-for-profit U.S. Federal Reserve as Deepcaster, former Presidential candidate Rep. Ron Paul, and legendary investor Jim Rogers, all have advocated.

b) Join the Gold AntiTrust Action Committee, which works to eliminate the manipulation of the Gold and Silver markets (www.gata.org).

c) Work to defeat The Cartel ‘End Game.’ Deepcaster has laid out the evidence regarding the Ominous Cartel “End Game” in “Coping with Power Moves in the Cartel's 'End Game' “ (04/24/2009) in the ‘Articles by Deepcaster’ cache at www.deepcaster.com. Clearly The Cartel is sacrificing the U.S. Dollar to prop up Favored International Financial Institutions and to maintain its power. But this sacrifice cannot continue forever. See Deepcaster’s July 2008 Letter in the ‘Latest Letter’ Archives at www.deepcaster.com.

8. Last but not least, acquire Gold and Silver as an Alternative Fiat Currency, but with timing, and in amounts and forms, which take account of The Cartel’s ongoing attempts at price suppression.

Conclusion:

If this aforementioned Strategy is employed effectively, it can result both in an increasing Core Position in Gold and Silver, and in considerable profit along the way. Additional insights and details regarding this Strategy, which are essential to profiting from The Cartel’s Policies, are laid out in Deepcaster’s article of 3/06/09 entitled “Investor Advantage: Revisiting The Cartel’s ‘End Game’ ” in the ‘Articles by Deepcaster’ cache at www.deepcaster.com.

Protection and profit require Proactivity and attention to the Interventionals, Fundamentals and Technicals, not “Buy and Hold.” We reiterate, “Buying and Holding” for the long term rarely succeeds anymore as current market conditions attest.

Indeed, the Key Point of the Strategy for Protection and Profit is careful attention not only to the Fundamentals and Technicals but also to the Interventionals. These Overt and Covert Cartel-generated Interventions have the power to move markets as those who study the matter can attest.

Thus, the Key to Profit and Protection is a Strategy: Successful Investors must become Long-Term Position Traders, with their trading choices informed by the Interventionals, as well as the Fundamentals and Technicals. Moreover engaging in the Actions suggested above can help prevent The Cartel’s obtaining Superpower status, and aid in achieving Wealth Protection and Profits as well.

Best Regards,

By DEEPCASTER LLC

www.deepcaster.com
DEEPCASTER FORTRESS ASSETS LETTER
DEEPCASTER HIGH POTENTIAL SPECULATOR
Wealth Preservation         Wealth Enhancement

© 2010 Copyright DeepCaster LLC - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

DEEPCASTER LLC Archive

© 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

Free Report - Financial Markets 2014