-- Posted Tuesday, 6 June 2006 | Digg This Article
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US MARKETS
The Illuminist Bilderberg group is holding its annual secret meeting June 8 through 11at the posh Brook Street Resort a few miles from Ottawa, Canada.
The hot topics this year are again oil prices and the major governmental changes in South America. About 120 world elitists will attend. High on the agenda is Iraq, Afghanistan and Iran. Should there be an Iranian invasion? Discussed will be the higher taxation being levied on companies that extract oil from Venezuela. They will also discuss Mr. Chavez’s destruction of FTAA, the Free Trade Agreement of the Americas. As you can see, a secret society exists, which plans out every detail of our lives.
It has been a year since we began to see signs of weakness in the real estate market. Obvious problems started to arise last September and today it should be plain for all to see that the growth has ended for the most part.
The bubble is breaking in the 30 hottest markets, such as New England, Washington, DC, Florida, Southern California and Las Vegas. Surprisingly the greatest devastation of households, foreclosures, loss of homes and bankruptcies is in the upper Midwest states of Illinois, Ohio, Indiana, upper New York state and Michigan, which is due to offshoring and outsourcing a result of free trade and globalization. The worst foreclosure rates are in Michigan, Ohio and Indiana. In the first quarter in Michigan the foreclosure rate was about 5% double the rate for 2005. In Ohio house prices have already fallen 6%.
Over the past two years interest rates have risen. The largest increase was in ARMS that have moved up from 4% to about 6%. The fixed rates are up approximately 1 1/2%. We see another rise of 3/8% to 1/2% by the end of the summer. As Treasury rates rise so do mortgage rates and in many instances payments increase $300 to $600 a month. The ARM’s are what former Fed Chairman Sir Alan Greenspan promoted to keep our economy from collapsing and ARMS were a main factor in the creation of the bubble. There are a number of variations of ARMS, interest only, option and adjustable rates, all of which could include no down payment. These types of exotic loans make up about one-third of loans outstanding. In California, they make up 62% of all mortgage loans. Generally home values in hot areas are off 10%, but some are unchanged, or are slightly higher. The state of prices vary widely. As the ARMS come up for renewal many are switching to fixed rate mortgages, but not at 6.6%. Most of these borrowers are sub-prime borrowers. In fact most shouldn’t have had a loan in the first place. They are paying 8% to 12% for the new loans, if they have equity, then they struggle to meet their payments. If prices in your region have stopped growing or are falling you may not be able to get a mortgage you can afford. Then there are those whose good paying job is now being done by someone in China, India or the Philippines, and no matter what the payments you cannot make them. Local, state and real estate taxes are rising taking away valuable funds and inflation is ravaging their buying power. The bottom line is there is no way out of this speculative, overextended bank debt except foreclosure, bankruptcy or both.
Experts tell us there will be 1.4 million foreclosures in 2006, or an increase of some 70% to 100% over 2005. Already in Indiana, one in 25 homes is in foreclosure, one in 30 in Ohio and one in 40 in Michigan. This occurs when mortgage payments are 90-days in arrears. In the upper Midwest, one out of 49 mortgages were in foreclosure in 2005. In Ohio, the foreclosure rate is up 20% a month and in Michigan it is double. In Indiana, they have tripled.
The Midwest region has been the hardest hit as free trade and globalization caused the loss of high-paying manufacturing jobs for low paying service jobs. People should have never been offered exotic loans ever, and at least 45% should never have been offered a loan in the first place. Lower wages and inflated costs have exhausted the withdrawal of equity from homes. The piggy bank, the ATM home cannot be tapped anymore. In 2006 alone, two million homeowners are at risk for foreclosure or 2.5% of the national total. Nationally, 1.6% were foreclosed in 2005. Sixty percent are in the Midwest and except for Chicago these homes have appreciated very little. This is the result of sub-prime lending. In a number of states, such as Pennsylvania, mortgages often are greater than the value of the home.
Twenty percent of sub-prime loans in Michigan, Missouri, Tennessee and West Virginia are in foreclosure. ARMS have put 14.7% of all mortgages in Michigan in foreclosure.
Freddie Mac says home sales will fall 8% in 2006 y-o-y, yet builders are still building and new and used home inventories are double what they were a year ago. Interest rates are moving higher and government is stepping in to curb the abuse on lending via exotic mortgages. Homeowners cannot for long spend more than 50% of their disposable income on mortgage payments. Real estate is in for a rough time over the next few years and Americans are about to pay a stiff price because the lending industry was directed by government to lend off the deep end.
Ninety percent of professionals still don’t really understand why base metals and gold and silver prices have gone up and are going higher. We have seen the formative base being formed for the biggest bull market in history. Unfortunately, the pros believe the government statistics on inflation and because of that they have missed the first 20% of the upward move. Hedge funds may be the leading force behind the commodity markets, but they sure haven’t influenced the gold and silver markets. Investment in commodities by hedge funds has risen from $15 billion three years ago to $100 billion. The size in investment in all commodities combined could be $250 billion, plus leverage of three to four times. This in part is the result of the carry trade, which could affect their participation. There is giant elitist money in the commodities market as well and that is one of the reasons we believe this group has a long way to go. The insiders have been accumulating base metals for ten years and this is a major hit for them. A bubble will eventually form, but not until the fundamentals are clearly pointing toward lower prices and we are nowhere near that yet.
There is no doubt of the murderous intentions of the pro-war elitist crowd that emanates from both the Republicans and the Democrats. The reports of the possible use of nuclear weapons are really nothing new. What we as Americans should be doing is to try to find ways to stop Bush/Cheney/Rumsfeld in their tracks. Moving via the court system is tedious and time consuming, so the only avenue open is Congress, and they either don’t have the time or don’t want to dethrone Bush and his neocons. The Democrats have said they won’t try to impeach Bush. What kind of a statement is that when there are several grounds for action? As you can see, both parties are cooperating to keep a corporate fascist government in power. Again, that is why in November you throw all the incumbents out with the exception of a few. We cannot do any worse than we are now. The dilemma is not hopeless. The longer we have turmoil in government the better it is for us. We must keep both the executive and legislative branches under fire until November. We must make them feel entrapped. Both Democrats and Republicans are arguing among themselves, and that is good because it means they can get very little accomplished and the less they accomplish the less injurious it is to us. We want them all screaming at each other, like Cheney did recently that people in the Republican Party were traitors. We presently have Republicans in revolt, mainly because the war for profit is going badly, the Senate immigration bill became a Democrat bill with limited Republican support and the polls tell Congress that a lot of incumbents are not going to be returning to Washington and that for Republicans that their president is a major detriment to their reelection. Challenging the President could in fact get them reelected. That is good for us because the more confusion and turmoil the less detrimental legislation gets passed.
Higher interest rates are not going to protect the dollar and higher inflation will continue to chip away at its value. A response to these higher rates will start to cut into consumer spending and home prices, ask anyone who just had to rewrite a mortgage. When Morgan Stanley’s, Stephen Roach, switches his bearish position and tells all is well because the IMF is going to rebalance an unbalanced financial system, you have to want to run for the hills. Now he has told us the rise in commodity prices is a bubble and doesn’t believe housing is in a bubble. Mr. Roach is not dumb, he’s a liar because if he tells the truth he losses his job. Mr. Roach now tells us there is no inflation. You might say we rest our case. All of Wall Street agrees with Mr. Roach and so you can take their advise with a grain of salt. Wall Street, government and corporate America have a massive disinformation campaign going on and you are not supposed to know about it. Can you believe they all want us to believe prices are falling and right before our very eyes we see them rising. Don’t be fooled by these crooks and protect yourself with gold and silver related assets.
The elitists intend to keep occupation forces in Afghanistan long after they pull out of Iraq. Once an Iraq pullout is affected considerably more troops will be moved into Afghanistan. We are about to be taken on another murderous ride. The reasons for the long term occupation of Afghanistan is, as we explained in 2000, it’s to geopolitically outflank Russia, to try to mute its influence and to protect the highly profitable opium crops and control the oil and gas from Central Asia and the area south of the Caspian Sea. Presently we have about 18,000 troops there and NATO has 9,000. The mission to kill or capture Osama bin Laden has been a failure after three years of searching. Anyone with half a brain knows bin Laden is working for the elitists via the CIA. Al Qaeda and the Taliban are still in the country after three years of occupation.
There have been 25 suicide bombs in the past six months and numerous kidnappings with the American contractors being the main target. The Taliban, though in the country is for the most part in Pakistan, our great ally. Elections were held and American puppets were installed and America’s warlords range the land. They are even in the government, but that position is only secondary to running drugs. Opium cultivation has now spread all over the country. The shattered economy has 24 million people still totally dependent on foreign aid, opium poppy cultivation and remittances from abroad. In 2006 we’ll only spend $615 million there while many Americans live in poverty. The Afghans go on their merry way producing opium, which returns 27 times more than wheat cultivation. This is what the elitist neocons call democracy.
GOLD, SILVER, PLATINUM, PALADIUM AND DIAMONDS
Though the rampant printing of currency and the unbridled issuance of credit, our country is saddled with debt. Our whole future is stunted by this massive debt. It affects every facet of our lives. It affects our economy and our foreign policy. Due to the Keynesian solution, our dollar is no longer a safe haven. Maybe the Canadian dollar, the Swiss franc and the euro may be temporary substitutes but the only real quality currency is gold.
In the 1970s, many people owned gold and silver coins and shares. Today, very few do. They don’t have a clue what is being done to them. Like it or not, the elitists have already lost. They have since 1962 given us an irredeemable currency, which is no longer measured in terms of gold. Yet gold has already become the dominant currency. Central banks sold more of their gold and in some cases all of their gold to suppress world gold prices, so that people would not understand what was being done to the US currencies and other fiat currencies. The elitists chase the destruction of the dollar by no longer making them redeemable in gold. Some central banks have added gold again to their reserves and that is helping the price rise, but most are sitting waiting for the inevitable collapse. The gold standard is not perfect, no one said it was, but it is by far the best monetary order the world has ever known, an order that worked.
We have recommended the sale of Barrick Gold since 1992, and at that time and since recommended shareholders sue the company for malfeasance, unfortunately, no one has done so. Over the past year gold has appreciated Barrick’s shares are up 20% while the S&P/TSX Capped Gold Index is ahead 85% and the Amex Gold Buys Index, which tracks 15 of the largest unhedged gold stocks in the US, is up 115%. Barrick’s current hedge book is offside some $6.5 to $7 billion, a figure you only find in Barrick’s footnotes. If gold keeps going up the hedge book losses could totally offset Barrick’s cash position of $12.5 billion. It is called a wipeout and as we predicted years ago, it is going to become a reality.
Peter Munk and his elitist board members and advisors are Bilderbergers, all have an engrained culture of destroying the gold market. In the 1970s, Mr. Munk only fled criminal charges by fleeing from Canada to America Samoa, where elitists put him into business. Mr. Munk is an elitist scumbag and well never be anything else.
Barrick is fighting two lawsuits it inherited from its purchase of Placer Dome. One, Marcopper Mining in the Philippines and at Pargera in Papua New Guinea. The purchase of Placer Dome and its large hedge book was a mistake. Barrick is an elitist operation and it won’t change until the company is destroyed. The stock is still a sell.
The IMF has admitted that central banks have been double counting their gold loans to make it appear they are still holding the gold.
There are gold and silver rallies coming and the cartel will short them again. They will be unsuccessful and gold and silver will rocket. Goldman is short $1.1 billion on Tocom alone and losing big.
Paulson will concentrate on harnessing the commodities market and controlling the fixed income market. Rubin had an easy task; the situation hadn’t gone beyond no return. Paulson will lose the battle and it won’t take long.
Australian gold production fell nearly 10% in the first quarter y-o-y, and 8% lower than the fourth quarter.
Dubai’s silver imports over the past three years surged from $25 million to $252 million in 2005. Re-exports of silver grew from $5 million in 2002 to $166 million in 2004. The increase is due to demand in the UAE for financial investment, industrial use, jewelry and photography.
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-- Posted Tuesday, 6 June 2006 | Digg This Article
