...

          The same parallel applies to our financial system.  The Illuminati wanted to make it look like our financial system was broken as an orgy of fraud was paraded before us by our fane-stream media due to a lack of regulatory action.  They took away Glass-Steagall courtesy of henchman Slick Willie Clinton and are now trying to replace Glass-Steagall with the Fed, when it is the Fed that is the base cause of virtually all our financial woes.  They want us to put a private company, operating in total secrecy, committed only to big banking interests without the slightest commitment to the welfare of US citizens, and put them in charge of virtually our entire financial system, which system the Fed has malevolently destroyed by expanding and contracting the money supply in a way that steals money from the average citizens and places it in the coffers of the wealthy Illuminists.

          Our regulatory system is perfectly fine, it is the people in charge of that system, basically Illuminist puppets, who are the problem.  This is the state of affairs that Elliot Spitzer was decrying.  He is the penultimate example of what happens to any government or regulatory official who steps out of line and criticizes the Illuminist cabal and its toxic policies.  What he did was wrong, yes.  But it would never have been exposed if he had not spoken out against what the Bush Administration had done to block efforts to investigate the real estate derivative fraud.  This is why your Congressmen cow tow to the Puppet Masters.  Most of these evil miscreants have gargantuan skeletons in their closets making them susceptible to extortion, which is often why they were selected by the Illuminists as candidates for public office in the first place.  Their bad habits set them up for puppetry at the hands of the Illuminati.  Either that, or they were just plain bribable.

          Our so-called "representatives" have trillions to dole out to their crony capitalist banking buddies who paid to get them elected, but when it comes to funding the SEC and CFTC, all we hear about is how they are under-funded and understaffed.  We suppose it is just as well, as the people running these agencies are little more than criminals themselves and are in on every Illuminist scam as co-conspirators.  If we gave them more money to catch criminals, they would find a way to put the extra money in their pockets while doing nothing to catch the criminals.  It would just be business as usual.  Slap the Illuminist criminals with diminutive fines, require absolutely no accountability or jail time, and make absolutely certain that crime pays, so long as the criminal is part of the Illuminist cabal.  Our financial system is a disgrace, and so are its regulators.

          Speaking of regulators, Ted Butler thinks he can work with someone like Gary Gensler, who is the current chairman of the CFTC, and an alumni of Goldman Sachs (gee, what a surprise).  Gary Gensler helped Larry Summers rig the gold market as the Clinton Administration established its strong dollar policy, taking gold down to its market bottom as Gordon Brown put his two cents in to create "Brown's Bottom."

          Gensler also teamed up with Summers to advocate the repeal of Glass-Steagall and the deregulation of derivatives via the Commodity Futures Modernization Act.  Ted thinks he can work with Gary because Ted is a gentlemen, but he should know better. These people do not think like he thinks.  They are greedy, slimy animals.  Never in a million years will they decrease position limits for the COMEX silver market without continuing the various exemptions enjoyed by the commercial shorts even though they have absolutely no legitimate business purpose to hedge other than pure manipulation. In fact, it is most likely that any reduction in position limits by the CFTC will be used to suppress the large specs, and thereby to strengthen the positions of the large commercial shorts.  But Ted is serving an important function in that he is documenting the rampant fraud and manipulation, and putting officials on notice, so they do not have the excuse that they were ignorant.  We commend him for this.  That way, when the trials and recriminations start, we will know who to prosecute and we will also know the precise nature of their crimes.  This is why we always put links to Ted's articles in the IF.  He is intelligent and well-meaning, and that is more than we can say for most newsletter writers who are little more than Illuminist disinformation specialists, or just plain idiots, with few exceptions.

          The Chinese, on the other hand, might very well accomplish what the CFTC regulators have refused to do, which is to break the paper log jam created by the Illuminist cabal in the silver futures market.  The Chinese just made it legal for their citizens to buy silver, probably so they can protect themselves from the idiot QE (Quantitative Easing) monetary debauchery being perpetrated against them and the rest of people in the world, including Americans, by Buck-Busting Ben.  Even though China's hands are just as filthy-dirty as America's, we can only say:  Go, China!!!

          Speaking of COMEX gold and silver futures, it appears that the Illuminati have solved their physical gold and silver inventory shortage which was causing them great headaches as massive demands for physical delivery were received.  At first, they just lied about their inventory.  The inventories did not change even as hundreds of requests for physical bullion were settled month after month, often with the help of central banks like the ECB and other outsiders like the Canadian mint.  Now, instead of using physical bullion, they can hand you an ETF contract instead.  So they are trading paper for, well, more paper!  Pretty slick, eh?  They want to give investors the convenience of having an interest in a publicly traded security so they will just hang onto it and not demand physical delivery.  But therein lies the trap.  These ETF's have leased large portions of their bullion out to the bullion banks for purposes of gold and silver suppression.  They do not have what they say they have any more than the COMEX does, and if you hold on to your ETF contract, you may well become the next victim of a Madoff-like Ponzi scheme.

          What this means, oh precious members of the hard money community, is that you should demand delivery of your metals from the ETF's assuming that this is possible pursuant to your contract.  Otherwise, here is what the system looks like:  You buy a COMEX gold or silver contract with cash.  You demand physical delivery of your gold or silver.  Instead, they hand you an ETF contract.  Unless you can demand the metal from the ETF, the ETF will simply hand you back cash instead when you liquidate your position, and you will be left hanging right where you started, with a pile of depreciating cash and no physical metals.  If you try to hold on to your ETF position to at least get the appreciation in value of precious metals, you may never be able to cash it in, because the ETF's may well turn out to be nothing more than Ponzi schemes.  If the sponsors do not have the metals, they will not be in a position to cash out all the shares.  And the COMEX can just hand out as many ETF shares as they please, because no one will be checking the legitimacy of these contracts, especially the ETF sponsors, who will be in cahoots with the COMEX.  

          Theoretically, under such a system where you are run around in paper circles leading to nowhere, you could buy and sell gold and silver in any quantity, no matter how vast and ludicrous, because there would never be a requirement anywhere in the system to produce the actual physical bullion!  This is unadulterated BS poppycock!!!  They can just short gold and silver forever and keep handing out ETF contracts to satisfy requests for delivery, and no one will be the wiser as there will never be enough ETF liquidations to empty the ETF's cash pot until it is too late and the Ponzi scheme blows up.  If the Illuminists need a technical advisor, they can always consult with Pat Kiley.

          We wanted to remind our friends in the deflationary camp that they seem to be forgetting about the crony capitalist bailout mentality that is setting us up for hyperinflation.  A large portion of world wealth held by private non-bank investors has already gone up in smoke (meaning that it was transferred from the middle class to the Illuminist cabal), and what wealth remains to be lost by non-bank private investors is far smaller than the losses which lie in wait for the anointed legacy banks on Wall Street, which losses will generate a crony capitalist bailout from the leaders of our Crony Capitalist Bailout Nation that will require the Fed to print money out of thin air in quantities more vast by far than all the losses suffered by non-bank private investors worldwide from the beginning of this financial crisis.  Those losses are hidden by mark-to-model rules for bonds and derivatives and are also being kept out of sight in a smoldering volcano full of toxic waste, aka the Quadrillion Dollar Derivative Death Star.     Remember that government spending of the type necessary to push through a recession or depression will only produce elevated double digit inflation such as we experienced recently and in the early 1980's.  To get what Zimbabwe and the Weimar Republic experienced, you need a carry trade in the subject currency established by a partnership between currency speculators willing to short the subject currency, and a central bank willing to print as much money as the currency speculators demand.

          Here in the US, the Fed cannot willy-nilly print money (although we believe they have illegally done so via Caribbean offshore accounts-hence their fear of an audit), and can only print as many dollars as Congress allows them to based on the national debt ceiling established by Congress.  Once the ceiling is reached, the Fed cannot print more money until Congress raises the ceiling again and the US Treasury authorizes further spending.  We believe that losses for the Fed and its 19 anointed treasury market-making banks, especially JP Morgan, Bank of America and Citigroup, are sitting on losses that will far exceed the 24 trillion mark touted by government bean counters recently.  We see 50 to 100 trillion dollars in Illuminist banking losses when interest rates rocket into double digits, which is a lock based on increased risk and QE debauchery of the dollar.  This will kill off the real estate markets and thousands of corporations, which in turn will ignite credit default swaps covering tens of trillions in losses.  It will be like AIG and Lehman Brothers on steroids.  Also, the interest rate swaps will become violently lopsided, and the hundreds of trillions in notional principal could easily produce tens of trillions in losses - annually - even if losses were contained at well under 10% of notional principal.

          Imagine for a moment that OTC derivative investors have swapped a variable rate stream of interest payments for a fixed rate stream of interest payments, with the fixed rate averaging say 5%, and then interest rates hit 15%.  If you're on the wrong end of the swap, you now have to pay out 15% on the variable side of the swap, and receive back only 5% on the fixed side of the swap, meaning that you are getting ripped for a net 10% of notional principal - annually.  Since there are now many hundreds of trillions of dollars of notional principal in interest rate swaps alone, that could produce tens of trillions in losses - annually!  What if the average fixed rate is now only 2% or 3% and rates go to 20% or 30%?  It is too terrible to even contemplate, especially if rates stay elevated for a half a year to a year or more.

           Remember, these tens of trillions of potential losses would be suffered annually as long as interest rates remained in double digits.

          Undoubtedly, the banks have hedged their bets so that they have both the fixed rate end, and the variable rate end, of these swap arrangements, but how out of kilter are they?  No one knows!  Then throw in the credit default swaps and the as yet unrecognized derivative losses that will be unleashed when banks are forced to mark to market again, and we can assure you it will be a bloodbath, and that is precisely what the Illuminati may have intended.  Why?  Because these losses will be bailed out in crony capitalist fashion only for the Fed and its anointed 19 too-big-to-fail banking entities, while the sufferers of the private non-banking losses are fed to the flames until they ignite and go up in smoke.  Once the private non-banking losses have been absorbed by the economy, the tens of trillions in losses suffered by the "anointed" banks may well be bailed out by the Fed and our corrupt Congress and Treasury Department in the Ultimate TARP Plan, and that can only happen by direct monetization.  This is the point where inflationary forces could very well overtake deflationary forces.  The Fed would be given carte blanche by the Congress and US Treasury, the dollar carry trade would be established, and the currency speculators would then go to town, taking us into destructive hyperinflation which will drag us into the nadir of the Much Greater Depression.  Put that in your pipe and smoke it for a while!

          Ben has no intention of slowing inflation once it gets rolling because he has nothing but toxic waste worth 10 to 30 cents on the dollar on his balance sheets which he can sell into the markets to absorb excess dollars.  He can crash the markets to slow inflation by draining money from the economy, but that means interest rates will rocket into the double digits, thus causing the Derivative Death Star to go supernova.  Next comes the tens of trillions in losses and the crony capitalist bailouts of the "anointed."

Inflation would be subdued only until the massive monetization was commenced in order to bail out the Fed and the other too-big-to-fail, "anointed" legacy banks.  At that point, the anointed will have all the cash, and you the taxpayer will be left holding the bag, unless you stop this criminal mischief in its tracks - RIGHT NOW!!!  What these miscreants have planned is the ultimate in the socialization of Wall Street's losses, and the pinnacle of debauchery.

          Why do you think foreign governments are so worried about the dollar?  They know what is coming, they are in damage control mode, and this fear bodes ill for the fate of the dollar.  The run for the exits is quickly approaching.  And we haven't even discussed the impact of the repatriation of foreign dollars when foreign holders of dollar reserves decide to go on a spending spree in the US, and the later impact of cash generated from the sale of US real property, tangible personal property and national resources that were obtained by foreign holders of dollar reserves via the foreclosure of liens which may have been granted to such foreigners by our corrupt government in order to secure their dollar holdings.  You will not know about these foreign investments in US property, or the enforcement of these liens, because the FTC no longer publishes any statistics dealing with foreign investment in the US.  How convenient, just like the cessation of M3 statistics by the Fed.

          In the meantime, Buck-Busting Ben is having the legacy banks park hundreds of billions of their capital with the Fed at interest in order to sterilize the money and secure their balance sheets until the time for the big takedown occurs, or until Bernanke needs some juice to prop up the markets to buy time.  This money will not be loaned out unless the Illuminists are desperately in need of a fix.  Remember, the idea is to grease the anointed legacy banks with credit and to starve everyone else.  This is just another means of transferring wealth to the Illuminists' coffers.  He is also handing money out to foreign banks in swap arrangements so they can prop up the dollar market and the stock and bond markets without having to raise capital in US credit markets, thereby avoiding upward pressure on interest rates.  Helicopter Ben also takes the foreign currencies he receives from these swap arrangements and sells them into the currency market to weaken these foreign currencies, thereby boosting the dollar whenever it is in need of quadruple bypass surgery.  Thus, trillions of dollars are being created out of thin air by the Fed in exchange for the equivalent in foreign currencies which are also being created out of thin air by the foreign central banks to keep the smoke and mirrors intact.  Note also that this is all misdirection.  Instead of the US boosting the dollar and foreigners weakening their currencies for trade advantages as you would expect, it is the foreigners who are boosting the dollar and the US which is weakening the foreign currencies.  This is how they keep you guessing and how they foil people who are trying to second guess them.  The whole financial system is being held together by chewing gum and bailing wire as Ben's dog and pony show hits Broadway and Main Street.  This is also why all currencies are going to depreciate against gold.

          Get your gold and silver and their related producer shares now at these bargain rates, or prepare to suffer total financial annihilation.  Yes, there will be attacks along the way that will try everyone's patience, but these attacks will grow weaker over time.            They are down to their last clip, and once those bullets are fired, it's up, up and away!!!  Just stay the course and do not be moved by all their Illuminist malarkey.  Keep buying on the dips, and hold on tight to what you have.  Do not try to beat these miscreants by trading, because they own the system which they now manipulate with impunity.  They operate strictly on insider trading, so trying to beat them at their own game is futile.  Using charts and graphs to make trades in such  heavily manipulated markets will get you nothing but losses.  Remember, they use the same charts and graphs that you do, and therefore they can anticipate your every move.  This is why manipulated markets always move counter to common sense.

          The general stock and bond markets are now deadly poison and should be avoided at all costs.  Leverage is only for psychopaths and insiders.  Only gold and silver shares will survive the downdrafts which the corrupt Illuminati have planned for these markets.  Also note that inside traders can profit in both rising and falling markets, so they will not hesitate to hammer the stock market if it suits their purposes, which may include a quick fix for the dollar as sales proceeds are plowed into the perceived safe haven of US treasuries.  They can always profit from planned chaos.  But don't worry, because gold and silver love chaos also.  They may get temporarily bloodied, but they always come roaring back.

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-- Posted Sunday, 23 August 2009 | Digg This Article