Loading ...‘Dismissed’…. doesn’t surprise me.
I agree that the timing and source of this publication smells highly. Why now? Somebody ‘over there’ wants to foment public opinion for some reason. Watch for big political troubles coming soon in that country.
I won’t argue with your views, which I include as the possibility of what took place. I’m just not going to bother to try and argue the details, because they’re unknown. The bottom line is it didn’t happen like the ‘official’ story says.
As far as this story, is it just another red herring? Why wouldn’t they site the fact they were re-publishing an old story? There’s no good reason not to state that upfront rather than leave the reader thinking it’s new info. So, don’t support any group that BSes you, whether they tell the story you want to hear or not. These guys aren’t honest, they aren’t your friends.
Re: the Hilton case, I understand it was dismissed, but not necessarily because it lacked merit. Funny that.
The bones of a polititian, lol, now that they have to admit it.
In reality these bones look to be that of a female. I wonder if that guy who said silver 69 oz by summer may not be too far off. An Asian lady at a coin shop told me that there is a shortage of silver, something supposidly comming from the mint, didn’t have time to ask too many questions, just checking to see if the situation was improving. I guess not. Don’t know how accurate her information is, or where she got it though.
I saved the link from the Pakistan Daily here.
It appears to be a transcript from an Alex Jones show interview, so maybe it can be found in the Alex Jones archives as well.
Consider the sources and make your own judgements. But I gotta say, the accusations are spot on with lots of independent research I have done for years from many sources. None of this surprises me. Hilton has guts to drive this legal stake home. I hope he succeeds.
I don’t remember who posted it, but here’s the link to the site, in case you don’t have it. I’d put that site (Pakistan Daily) on the ‘don’t bother reading their crap’ list…
I picked up on the fact that it was at least 4 years old and was curious if the poster had any other later information as to the current status ….. that’s why I was looking for the original post.
Not sure if you noticed, especially since they didn’t state it, but that story with today’s date on it was about 4 years old! That’s maybe why the person who posted it yanked it, who knows. If you do a search on Stanley Hilton & 9-11 & lawsuit, you come up with all sorts of stuff. Let us all know if you can sort of the valid info from the mis- & dis-information and outright lies! Hard telling, not knowing…
I had a good Victoria Day weekend last week ….. So, all American posters have a great Memorial Day Weekend.
nothing up from me! Who ever posted the link asked whether it was a reliable web-site, so maybe they decided it wasn’t and deleted their post. Have a good Memorial Day weekend.
To the largest newspapers in Australia
(The Perth Mint - Tarnished?)
Silver Stock Report
by Jason Hommel, May 22nd, 2008
Australia’s Perth Mint is suspected of being bankrupt by customers who are discovering a dizzying array of fees, delays, and refusals upon making requests for delivery of silver.
The Perth Mint, by its own admission, has a precious metals liability of $880 million Australian dollars to certificate holders, and has leased $380 million of this metal out to its own subsidiaries to be used as an operating pool for operations, as is indicated in their 2007 annual report at the bottom of page 81.
But an operating pool’s primary purpose is to fulfill customers’ orders, and if those orders cannot be filled in a timely manner, then that would indicate a precious metals pool that has evaporated.
Jason Hommel of SilverStockReport.com, writes a internet newsletter on precious metals that goes out to 80,000 subscribers, and has recently notified various agencies of the government of Western Australia that he has received complaints from 30-50 customers who have been unable to obtain silver from the Perth Mint.
While the Perth Mint maintaints it is backed by the government of Western Australia. But if the mint has no silver to sell, the mint’s reputation may be tarnished. They’d better polish up their act.
Sincerely,
Jason Hommel
www.silverstockreport.com
www.miningpedia.com
____________________
abtd
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WEEKEND EDITION
Bank failures to surge in coming years
IndyMac, Corus, UCBH under pressure as credit crunch slows economy
By Alistair Barr, MarketWatch
Last update: 6:27 p.m. EDT May 23, 2008Print E-mail RSS Disable Live Quotes
SAN FRANCISCO (MarketWatch) — By April, Gary Holloway was almost three years into retirement.
He’d built a new home by a lake in Texas, bought a boat and was working on his golf game. While taking on some part-time work, Holloway also traveled for months across the U.S. with his wife, from Seattle to Washington D.C., catching up with old friends and family.
That life of leisure abruptly changed about six weeks ago when Holloway got a phone call from his former employer, the Federal Deposit Insurance Corp., or FDIC, which regulates U.S. banks and insures deposits.
Holloway, a 30-year FDIC veteran, had worked extensively with failed lenders in Houston during the savings and loan crisis in the late 1980s and early 1990s, when thousands of thrifts collapsed.
Earlier this year, the FDIC began trying to lure roughly 25 retirees like Holloway back to prepare for an increase in bank failures. It’s also hiring about 75 new staff.
Holloway quickly went back to work. ANB Financial N.A., a bank in Bentonville, Ark. with $2.1 billion in assets and $1.8 billion in customer deposits, was failing and an expert like Holloway was needed to value the assets and find a stronger institution to take them on.
“I was very excited about coming back,” Holloway said in an interview. “I’m now 57. There’s still a lot of life left and the juices are flowing again.”
On May 9, life for ANB ended when the FDIC and the Office of the Comptroller of the Currency, another bank regulator, announced that the lender was closing. See full story.
Only three banks have failed so far in 2008. But that number is set to surge as the credit crunch slows economic growth and hammers some lenders that grew too fast during the recent real-estate boom, experts say.
The roots of today’s banking crisis grew out of the boom and bust in the real estate market. Lenders originated more and more mortgages, while other banks, particularly smaller and medium-sized institutions, ploughed money into construction and development loans.
‘You don’t avoid the problem. It’s too late to wait and hope that things get better.’
— Joseph Mason, Drexel University
While loan growth soared in 2004 and 2005, most regulators failed to scrutinize many banks or restrain this heady expansion of credit. Now that the loans have been made and delinquencies are climbing, some banks may already be doomed.
Marriages and managing
“At this point in the crisis, you can’t stop bank failures,” said Joseph Mason, associate professor of finance at Drexel University’s LeBow College of Business, who has studied past financial crises.
“At this point you manage through failures and arrange marriages where another stronger bank takes on the assets and deposits,” he said. “You move through the problem. You don’t avoid the problem. It’s too late to wait and hope that things get better.”
Things may get worse before they get better.
At least 150 banks will fail in the U.S. during the next two to three years, according to a projection by Gerard Cassidy and his colleagues at RBC Capital Markets.
‘There has been excessive loan growth and some banks won’t be able to access capital markets to replace the money that will disappear as credit losses rise.’
— Gerard Cassidy, RBC Capital Markets
If the current economic slowdown deteriorates into a recession on the scale of those from the 1980s and early 1990’s, the number of failures will be much higher this time around — probably as high as 300 of them, by RBC’s reckoning.
That’s a massive surge compared to the recent boom years of the credit and real estate markets. From the second half of 2004 through end of 2006 there were 10 consecutive quarters without a bank failure in the U.S. — a record length of time, Cassidy notes.
“This downturn will trigger a significant amount of bank failures relative to the past five years,” he said. “There has been excessive loan growth and some banks won’t be able to access capital markets to replace the money that will disappear as credit losses rise.”
Texas Ratio
Cassidy and his colleagues have developed an early-warning system for spotting future trouble at banks called the Texas Ratio.
The ratio is calculated by dividing a bank’s non-performing loans, including those 90 days delinquent, by the company’s tangible equity capital plus money set aside for future loan losses. The number basically measures credit problems as a percentage of the capital a lender has available to deal with them.
Cassidy came up with the idea after covering Texas banks in the 1980s. Until the recession hit that decade, many banks in the state were considered some of the best in the country. But as problem assets climbed, that view was cruelly challenged, Cassidy recalls.
The analyst noticed that when problem assets grew to more than 100% of capital, most of the Texas banks in that precarious position ended up going under. A similar pattern occurred in the New England banking sector during the recession of the early 1990s, Cassidy said.
Along with his colleagues, Cassidy applied the same ratio to commercial banks at the end of this year’s first quarter and found some disturbing trends.
UCBH Holdings Inc. (UCBH:ucbh holdings inc com
News, chart, profile, more
Last: 5.51-0.28-4.84%
The FDIC only has $48B to cover Trillions of losses. The banks have $62 Trillion in derivatives in the USA vaults—-($516 T worldwide)—- BBBBBBBBBBBOOOOOOOOOMMMMMMMMMMM
______________
abtd
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Gary North’s REALITY CHECK
Gold’s price:
www.GaryNorth.com/snip/300.htm
The Federal debt:
www.GaryNorth.com/snip/544.htm
To subscribe to this letter:
www.snipurl.com/subscribenow
Issue 756 May 23, 2008
WHEN SKOUSEN GAVE FRIEDMAN A LESSON IN MONETARY THEORY
The story you are about to read is true. The names
have not been changed to protect the innocent. But first,
a little background material is called for.
The Federal Reserve System was granted a monopoly over
monetary policy on December 23, 1913, when the Senate voted
to pass the House’s bill, which had been passed on December
22. President Wilson signed the bill into law that
evening.
Ever since that fateful day, economists have done
their best to get their opinions on monetary policy
accepted by the FED. The only exception to this
generalization is the Austrian School of economics. Their
members, who are few in number and are generally without
influence, do not believe that a government-licensed
monopoly is capable of setting monetary policy without
distorting the free flow of capital, especially the most
crucial form of capital: information. So, they do not
attempt to influence staff economists at the FED. They
know it is a waste of time.
RIVAL SCHOOLS OF OPINION
There are several views of how monetary policy should
be conducted. The most famous view is that of Milton
Friedman. He argued for decades that the gold standard is
a waste of gold, since governments must store gold in
vaults. This valuable commodity could be used for
productive purposes.
He wanted every nation’s central bank to produce money
at all times at a constant rate. He never decided on a
rate. He suggested a range: 3% to 5% per annum. This view
was the conservative opinion when I was in graduate school.
Keynesian economists argue for monetary policy to
accompany fiscal policy. It must be subservient to fiscal
policy. The central bank should partially finance
government deficits in times of economic recession, when
governments are supposed to run massive deficits. The
central bank should buy government debt with newly created
money. Its staff economists should decide which rate of
inflation is the best at any given time.
This is also pretty much the view of supply-side
economists, who argue that government deficits don’t
matter. They recommend reduced marginal income tax rates
and corporate tax rates, but they almost never argue in
public during a recession that the government should also
cut spending to match reduced taxation. They also do not
argue that the central bank is unwise to expand money in a
recession. As long as marginal tax rates are cut, they
don’t care much about monetary policy. A few of them call
for a strange kind of gold standard, one which doesn’t
issue money that allows everyone to demand payment in gold
by the Federal government at a price fixed by law. Why, I
don’t know. It is a pseudo-gold standard.
These groups agree on one thing: there should never be
a central bank policy of monetary contraction. This means
that the central bank should never sell government debt
without purchasing an offsetting asset of some kind.
This is the monetary ratchet. The money supply never
falls. Whenever it rises, due to central bank policy, this
increase becomes permanent.
Austrian School economists are in fundamental
opposition to all three majority schools of opinion. They
believe that money should be private, that contracts
promising to pay in a monetary unit of account should be
enforced, that no bank should be given a monopoly by the
government, and that the public should decide what
constitutes money through their dealings, not through
legislative fiat. The civil government should get out of
money production altogether.
To illustrate the conflict between the Austrian School
and the Chicago School, Mark Skousen designed a test. I
was present when he conducted this test — or, as the case
may be, sprang the trap. I reprint the following without
alteration.
I sent this document to Skousen on the day I wrote it.
He agreed with me at the time that this account is an
accurate summary of what he did and why.
SKOUSEN’S TEST OF MONETARY THEORY
I am writing this on October 17, 1998
On the evening of October 15, I went out to dinner
with Mark Skousen, Van Simmons, and Milton and Rose
Friedman. It was at Mark’s invitation. We went to the
Commander’s Palace in New Orleans. We were in town for the
annual Blanchard Seminar.
Mark had arranged to have Van Simmons bring a U.S.
gold coin, dated 1912, which was Milton Friedman’s year of
birth. He is in the rare coin business. It had been hard
to locate. The year is rare. He had it send from
Switzerland by Federal Express overnight that same day.
The Swiss contact had only one such coin.
Before the evening had gone more than a few minutes,
Friedman brought up the issue of our (the Austrians’)
ideological commitment to the gold standard. The fact is,
there is no ideological commitment to the gold standard
among Austrian economists, since they don’t think the
government should have any monetary standard except for tax
payments. They do not think governments should be in the
money-production business. Mises believed in free banking.
Rothbard believed in 100% reserve banking, as does
Friedman’s economist brother-in-law, Aaron Director. As to
which metal the free market adopts as its monetary
standard, the Austrian doesn’t care, although he thinks
gold is the most likely for international trade. Silver is
second.
The important thing for the Austrian is that there be
no legal tender laws and no price control schemes setting
the exchange rate of one currency or metal in relation to
another. There should be no legal compulsion over money,
other than to enforce contracts. The Rothbardians do argue
that the fractional reserve system is fraudulent and
therefore should be prohibited. But their problem is:
Prohibited by whom? They do not believe in the State.
Friedman had said at least twice that he did not
understand why there is an ideological commitment to gold
by us, meaning Mark and me. Perhaps 15 minutes later, Mark
brought out an old $20 gold paper note, issued by the
government (pre-1913). It was a written contact: to pay
gold to the bearer. He asked Milton to pull out a $20 bill
and read the contact. It makes no such promise.
Then Mark took Friedman’s bill and tore it up. Milton
looked at the bill’s remains, lying on the table. He was
silent at first. Mark then handed him the $20 gold piece.
But Friedman pushed it away. “I don’t want it. I want the
$20. I didn’t authorize you to tear it up.” This was of
course true. But there had been compensation economically,
at about 30 to one.
Mark was trying to make a point about broken
contracts: the government’s abandonment of gold pre-1934
gold contracts. The point was lost on Friedman.
Friedman then said it was wrong to tear up a $20 bill,
because doing so passed some appreciation to all other
holders of paper money. In theory, this is correct.
Empirically, it would be impossible to measure or prove.
After a few minutes, Friedman calmed down. Mark had
to give him a replacement $20 bill to calm him down.
Friedman did like the coin, with his birthdate on it. He
decided to keep it.
What struck me after the dinner was over was
Friedman’s ideological commitment to paper money. A $600
coin was nothing; that lost $20 bill was everything. The
tearing up of that bill was almost like an act of sacrilege
in his eyes. The coin did not compensate him. Only a
replacement bill did.
He has spent his career arguing for paper money and
against a metallic standard. Before the coin incident, he
had repeated several times his old argument that digging up
metal is a waste of scarce resources. He has never
understood that the costs of digging up metal — that
portion of gold used for money rather then jewelry or
industry — in the legal world of a gold standard is a very
cheap way for society to restrict governments from
inflating. If governments are in the money production
business, then they should be limited by the costs of
producing the money metals. These costs chain their lust
for spending fiat money and avoiding direct taxation.
Men often do not see their own ideological
commitments. They see only their opponents’ ideologies.
I shall not publish this report in Friedman’s
lifetime. He has done yeoman service in battling price
controls and taxation. No need to embarrass him. But in
money matters, he was ideologically committed to the State
as the final arbiter of money. He just wanted the
bureaucrats to run the system by his recommended 3% to 5%
increase in money per year. They refused.
– end of report –
WHAT IS THE SOLUTION?
The solution is freedom. I have outlined the solution
in my 1987 book, “Honest Money.” You can download it here.
www.garynorth.com/public/512.cfm
The free market can be trusted in monetary affairs.
Anyone who defends the free market in most areas of the
economy and then insists that the civil government can be
trusted to conduct a fair and efficient monetary policy
needs to explain his reasons. I have found that the
economists who defend central banking do not explain why a
cartel in banking is in the public interest but cartels in
every other area of the economy are not in the public
interest.
The most free market oriented of all first-year
college economic textbooks is the one written by Gwartney
and Stroup. This is the only one written by members of the
“public choice” school of economics, which is famous for
arguing that every government employee is governed by the
same self-interest as anyone else, including capitalists.
In the 4th edition (1987), we read:
Central banks are charged with the responsibility
of carrying out monetary policy. The major
purpose of the Federal Reserve System (and other
central banks) is to regulate the money supply
and provide a monetary climate that is in the
interest of the entire economy (p. 281).
The authors then devote ten pages of text to a
description of the operations of the FED, without one word
of criticism, and openly denying the private legal status
of the system: “In reality, it would be more accurate to
think of the Fed and the executive branch as equal partners
in the determination of policies designed to promote full
employment and stable prices” (p. 283). Equal partners? I
have a few questions.
What happened to Congress, which the Constitution
assigns exclusive power over the purse?
What happened to the laws of economics?
What happened to self-interest?
What happened to the economic analysis of
monopoly, which the authors apply to every other
area of the economy?
The authors do not even hint at the possibility that
any of these issues is relevant. They continue.
Public enterprises can thus be expected to use at
least some of their monopoly power, not to
benefit the wide cross-section of disorganized
taxpayers and consumers, but as a cloak for
inefficient operation and actions to advance the
personal and political objectives of those who
exercise control over the firm. Government
ownership, like unregulated monopoly and
government regulation, is a less ideal solution.
It is not especially surprising that those who
denounce monopoly in, for instance, the telephone
industry seldom point to a government-operated
monopoly — such as the Post Office — as an
example of how an industry should be run (pp.
466-67).
The authors by this stage in their textbook had
already pointed to just such a government monopoly (as they
incorrectly and misleadingly defined it), the most powerful
and profitable monopoly of all, the monopoly over money
creation and monetary policy: central banking. They
discussed the FED in Chapter 12, “Money and the Banking
System” before they presented Chapter 19, “Monopoly and
High Barriers to Entry.”
The authors expect the reader to fail to notice this
theoretical discontinuity, as if there were some economic
justification of the inapplicability of Chapter 19’s
analysis to Chapter 12. This is a safe assumption. Most
students do not notice. Neither does Congress.
If there is any area of the economy that cannot safely
be trusted to the government or a government-licensed
central bank it is monetary affairs. This is licensed
counterfeiting. The authority to counterfeit money to
increase government purchases — through the sale of
government debt — will be misused.
The best book on this is by Jesus Huerta de Soto,
“Money, Bank Credit, and Economic Cycles” (2006), published
by the Mises Institute. You can download it for free here,
but it’s wise to buy it in hardback.
www.mises.org/Books/desoto.pdf
SOVEREIGNTY
The intellectual battle over monetary theory is
ultimately a battle over the issue of sovereignty. Which
agency possesses lawful sovereignty — a final say — over
the operation of the monetary system?
The answer of the vast majority of economists is this:
the state. They believe that sovereignty over money is an
inherent aspect of civil government. But they never admit
to their readers that sovereignty is the supreme issue, nor
do they admit that they have taken a stand in favor of
state sovereignty. They never discuss the reasons for
their commitment to state sovereignty in monetary affairs.
They also do not use the argument for efficiency. Why
not? Because in the rest of their writings, they have
exposed the fallacy of the concept of government
efficiency. It would be difficult for them to make the
case for a cartel as the preferred engine of efficiency.
What remains? Ethics. They must show that, because
of the issue of right and wrong, of good vs. evil, the
state must have a monopoly over money, and not just a
monopoly, but a transferable monopoly. They must show
that the cartel of profit-seeking counterfeiters has a
moral claim of this delegated sovereignty over money. They
never do this. They never raise the issue of ethics in
money.
There is one exception: Murray Rothbard. He placed
ethics front and center in his discussion of monetary
policy. His textbook on money and banking, “The Mystery of
Banking,” is the only textbook by an economist that does
this. This is one reason why no college or university has
assigned in over two decades. You can download it here.
www.mises.org/Books/mysteryofbanking.pdf
Rothbard showed why the cartel over money is immoral.
He also showed why it is inefficient, if by “efficient” we
mean “not inflating, not creating recessions, and not
redistributing wealth from the those who trust the
government to skeptics who know the game is rigged against
the common man.”
CONCLUSION
We do not have a free market in money. We have a
self-interested cartel. This cartel will do whatever it
can to protect its lucrative monopoly over money.
You would be wise to assume, as in all other areas of
the economy, that the following offer is suspect:
“I’m from the government, and I’m here to help
you.”
IMHO EURUSD is just forming a double top like it did in 2004 and 2005.
Fed timely closed the door - because towards election lower oil and gas is needed, what will only work with stronger dollar.
At the same time yen crosses and yen carry trade are again in vogue - actually lining up for a big rally and new highs towards yearend. Wait once equities will make bottom in 1st or 2nd week in june (or a week or two later) - thereafter better don’t stand in front of that train.
Draw the lines for jpy (double bottom) and jpy-crosses, draw the lines for usdcad (double bottom) , think of lower oil and an equities rally towards election … and the picture is pretty clear.
Only question which remains … when will equities bottom. Somewhat tough -given that mr. market is waiting for bank earnings.
My wild guess is either in 1st or 2nd week of june; june 7 is a major bradley turning day. If there is no bottom in june it might last until early september until equities will fly again.
Additionally … once equities bottom out that will also mark the second top for eurusd and similar swissy. The recent blow-off high in oil likely was just another confirmation, that also EURUSD and GBPUSD have topped out for the year.
So again: everything depends on equities now.
Next year and after elections is quite another story … at least for equities. PEI-cycle top coming and in late november another major bradley turning point.
PMs towards elections? I expect em to rally with equities and the dollar, with some bumps in the road of course.
