-- Posted Friday, 10 October 2008 | Digg This Article
| Source: GoldSeek.com
DEEPCASTER LLC
www.deepcaster.com
DEEPCASTER FORTRESS ASSETS LETTER
DEEPCASTER HIGH POTENTIAL SPECULATOR
Wealth Preservation Wealth Enhancement
Financial and Geopolitical Intelligence
The ongoing and intensifying Series of Financial and Economic Crises reveals a Pattern.
Analyzing this Pattern provides excellent clues about future financial and economic developments, and especially about near-term, as well as long-term, developments. These clues provide the key to Profit, as well as the Alert to Dangers, and clues regarding the next MegaMove.
The Overall Outline of The Pattern is slowly becoming clearer and is revealed by considering the examples described below.
Deepcaster was among the first to Forecast not only the Crises we now experience but also the likely “End Game” Plan of key Central and Commercial Bankers and their Allies.
Deepcaster was among the first to expose a “Massive Financial-Geopolitical Scheme Not Reported by Big Media” in an Alert published on August 11, 2006 (all Deepcaster articles can be found in either the Alerts Cache, Latest Letter Cache or Articles by Deepcaster Cache at www.deepcaster.com).
This “End Game” Scheme has many components, one of which is to facilitate the destruction of the U.S. Dollar and its replacement by the Amero. Fortunately, there are others who recognize the Perfidy of this Scheme and have sought to stop it, including a few members of Congress (see H. Res. 40 – Goode, R-Va.).
A Central Characteristic of this Nefarious Scheme is manipulation of Major Markets by a Cartel* of key Central Bankers and their Favored Financial Institutions.
*We encourage those who doubt the scope and power of Intervention by a Fed-led Cartel of Central Bankers to read Deepcaster’s January, 2008 Letter containing a summary overview of Intervention entitled “Market Intervention, Data Manipulation - - Increasing Risks, The Cartel End Game, and Latest Forecast” at www.deepcaster.com>LatestLetter. Also consider the substantial evidence collected by the Gold AntiTrust Action Committee at www.gata.org 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.”
In order to effect this Market Manipulation Regime, the Cartel has facilitated the creation of nearly $600 trillion of OTC Darkly Liquid Derivatives (see bis.org, path: statistics>derivatives>Table 19 and ff) see Deepcaster’s “Derivatives Deluge Multiplies Real Risks and Potential Profits” of 12/01/06. These Derivatives have a wide variety of characteristics and “uses,” but the two in our focus are:
1) Magnified Profits (and Losses) - - when the market moves favorably (and magnified losses when the market moves unfavorably) and
2) Market Manipulation - - given the aforementioned Magnification Effect, their proliferation causes increasing Financial Systemic Risk.
Among other characteristics of the Cartel Interventional Regime is what Deepcaster has described as a “War on Tangible Assets.” In order to prevent Precious Monetary Metals and Strategic Commodities (e.g. Crude Oil) from gaining legitimacy as superior Stores and Measures of Value to their Fiat Currencies and Treasury Securities, the Cartel periodically intervenes to cap and take down prices of key Commodities, especially Gold and Silver. In response, Deepcaster developed a strategy for “Profit Potential From The War on Tangible Assets” in his article of 1/5/07.
A major impediment to Protecting and Profiting from the increasing deluge of OTC (Over The Counter) Derivatives is that many of them are only darkly liquid (or, as recent events show, illiquid) that is to say they are OTC and not publicly Exchange Traded. That means that they are not often publicly reported (see Deepcaster’s “Protecting Profits From Dark Liquidity & Other Systemic Risks” article of 4/6/07) yet their existence can have a profound effect on the markets, as the current Credit Freeze-Up attests.
As the evidence continued to develop throughout 2007, it became clear that the implementation of the Cartel’s “End Game” Scheme was continuing relentlessly. Consequently, on 6/6/07, Deepcaster published “Profiting From the Push to Denationalize Currencies and Deconstruct Nations” (in the Articles Cache at www.deepcaster.com).
One consequence of the End Game Scheme implementation will likely be a massive redistribution of wealth to the owners of the private-for-profit Fed (and to their favored financial institutions) via a scenario quite similar to the one revealed by the “Boom of the 1920s” and consequent Depression and Foreclosures of the 1930s.
Clearly this increasing flood of OTC Derivatives is increasingly causing negative consequences including, for sure, our worsening Hyperinflationary Recession (leading eventually, perhaps, to Depression). Others in addition to Deepcaster have substantiated this point. For example www.shadowstats.com reports the Real Numbers for Unemployment, Inflation, M3 and GDP by using pre-1990 methods (before they were gimmicked) to calculate them. For example, as calculated by shadowstats, currently the Real CPI is 13%, Monetary Inflation (M3) is 14%, Real Unemployment is 14.5%, and real GDP is a negative 2%, all annualized.
Some claim that, given the Housing Price Deflation, Equities Market Deflation, and Ongoing Commodities Price Deflation, we are in a deflationary rather then hyperinflationary environment. Alas, if only it were true. On a net basis, we are actually in a hyperinflationary environment because, inter alia, the pace of Fed-generated monetary inflation at 14% annualized is far greater than the housing/equities markets/commodities price deflation.
The bottom line is that the hyperinflationary influence of rampant money supply expansion, plus the Bailout Bills, Massive Credit Creation and other Fed buyouts and Market Support Actions is far more inflationary than the aforementioned deflationary items taken together.
And there is another Negative Consequence to the dramatic inflation of the OTC Derivatives market, which according to the Bank for International Settlements was $596 trillion as of December, 2007 (www.bis.org, path: statistics>derivatives>Table 19 and ff). That major consequence is the ongoing credit market freeze-up.
The August, 2007 Credit Market Freeze-up was the first indication to investors-at-large that the Toxic (to use Warren Buffet’s term) OTC Paper Empire The Cartel had facilitated was becoming unraveled. The key Symptom of Systemic Illness was the Credit Market Freeze-up beginning in that month. By the end of 2007, it became clear that the few Band-Aids that the Fed and Treasury had applied to unfreeze the Credit Markets had been unsuccessful and one would have to plan ahead to protect profits (see Deepcaster’s article “Protecting Profits From the Burning Platform” of 12/2/807).
It has also become clear that virtually no sector was immune from OTC Derivatives, Data Manipulation, and Market Intervention Contagion. Specifically, it was clear that even traditionally Defensive Sector stocks were no protection from the Derivatives Implosion or the onrushing train of Hyperinflationary Recession (the Big Pharma sector’s Bristol Myers Squibb’s Derivatives-caused write-down is one object lesson - see Deepcaster’s “Profit From and Protection Against Defensive Sector Stocks” of 2/1/08).
Indeed, as we moved into 2008, it became clear that there would be ever more severe OTC Derivatives Market failures and worsening Credit Market Freeze-ups such as we have recently experienced (see “Profiting and Protecting from Collapsing Paper” of 2/15/08).
It also became clear that the Cartel was continuing to implement its nefarious “End Game” as a result of the aforementioned crises (see Deepcaster’s article of 3/7/08 entitled “Increasing Systemic Risk Portends Cartel End Game Attempt”).
It is also becoming clear that notwithstanding the tremendous power of the Fed-led Cartel, that power was unsustainable, absent The Cartel’s being successful at implementing its End Game (see Deepcaster’s article of 1/4/08 entitled “Private Ownership of U.S. Fed Unsustainable”).
In response, Deepcaster developed an Approach that provides substantial potential for “Defeating The Cartel…With Profit” (3/28/08).
Nonetheless, as we indicated, it was (and is) in The Cartel’s interest to reach with Hubris for even more power as we Forecast in our 4/4/08 article “The Fox Wants More of Our Chickens” and “Profit From Fed-Catalyzed Crises” of 7/3/08). The subsequent Bailout Bill conferring vast power to intervene in ostensibly “free” markets and control the fate of any business is but one manifestation of that Hubris.
As crisis after crisis which Deepcaster had predicted developed it became clear by June, 2008 that the “Systemic Meltdown Risk Increases.” It also became clear by July, 2008 that we were moving into an Abyss in which the whole Financial System could fail (see “Crisis Opportunities As We Move Into the Abyss” on 7/11/08 and “Profit From the Jaws of Death” on 7/25/08).
Indeed, that Forecast was prescient, as that Abyss has subsequently swallowed several trillion dollars in nominal Equities Value by early October, 2008.
But as the Bailout Disaster approached and the financial system came closer and closer to lockdown, Deepcaster developed strategies to cope with this (see “Opportunities & threats from the Paper Money Regime” of 8/1/08 and “Opportunities in the Impending Perfect Storm” of 9/5/08 and “Strategy Beyond the Bailout Outrages for Profit and Protection” of 9/12/08). Deepcaster’s Strategies and Forecasts have facilitated very profitable recommendations for Deepcaster subscribers (via five short positions going into September, 2008), as disclosed on the front page of www.deepcaster.com.
Most recently, Deepcaster Forecast well in advance that the bailout package that a cowed Congress passed would not work to solve the financial systemic crises. Indeed, it will, in the long run, serve to increase the threat of Systemic Meltdown. Subsequent events have proven that Forecast correct.
Of the several reasons that we laid out that the Bailout will in fact increase meltdown risk, one is worth noting here. That is, under the Bailout Plan that passed, the Treasury will literally give at least $700 billion to a variety of Favored Financial Institutions in return for paper which has little or no value. To finance this gift, additional tax payment obligations will be placed on the American Taxpayer, burdens the repayment of which will have to be financed by Treasury (Taxpayer) borrowing from the private-for-profit Federal Reserve.
Given that the U.S. Consumer/Taxpayer is 70% of the U.S. GDP, additional debt (upon which interest, at least, must be regularly paid) this will only increase home mortgage, credit card and other obligation defaults and thus increase the Financial and Economic Systemic Risk, while not preventing future freeze-ups or Systemic Failure.
Of course, many other sensible alternatives to the Bailout Giveaway were available (as former Treasury Secretary O’Neill and Professor Roubini have shown) but, the powers-that-be in Washington, spearheaded by Fed Chief Bernanke and Treasury Secretary Paulson wanted a U.S. Taxpayer-funded Giveaway to Wall Street, and a Taxpayer-funded Giveaway they got.
The Bottom Line is that The Crises are not over - - they are only just beginning. Therefore, one must be constantly vigilant to proactively take steps to protect one’s wealth and profit to the extent one may from the ever-increasing number of crises.
Therefore, Deepcaster has developed a strategy (in his Article of 9/26/08) for “Protection and Profit from Bailouts Doomed to Fail.”
The central focus of The Strategy for Protection and Profit is careful attention not only to the Fundamentals and Technicals but also to the Interventionals. These Cartel-generated Interventionals literally have the power to move markets, as those who study the matter can attest.
Protection and Profit require Proactivity, and attention to the Interventionals as well as Fundamentals and Technicals, not “Buy and Hold.”
Buy and Hold rarely succeeds anymore, as current market conditions attest.
The Key to Profit and Protection is a Strategy. Successful investors must become long-term traders, with their trading choices informed by the Interventionals as well as the Fundamentals and Technicals.
Deepcaster
October 10, 2008
DEEPCASTER LLC
www.deepcaster.com
DEEPCASTER FORTRESS ASSETS LETTER
DEEPCASTER HIGH POTENTIAL SPECULATOR
Wealth Preservation Wealth Enhancement
Financial and Geopolitical Intelligence
Gravitas, Pietas, Virtus
-- Posted Friday, 10 October 2008 | Digg This Article | Source: GoldSeek.com
