Tag Archives: Alan Greenspan

Want to Smack Down the Criminal Global Banking Cartel?

Yeah, I believe there’s quite a few investors who would like to smack a couple of bankers after being deceived about their financial situation and the state of the economy in general. I do not encourage violence in any way, but would really like to see someone pull the pants of those big shots who think they’re just doing God’s work while the common tax payers are financing their private jets, limousines, 7 apartments and 14 beach houses. And the more sophisticated, the better. JS Kim at SmartKnowledgeU appears to have a plan.

“Sell the likely fraudulent SLV and GLD ETFs, cease participating in the fraudulent gold/silver futures markets, buy physical gold and silver, and buy gold/silver mining stocks.”  

JS Kim

In 1966, Alan Greenspan wrote an essay more than two decades before his sold his soul to bankers, that indicted the US Federal Reserve in as clear language as possible for the Great Depression that afflicted the world economies at the end of the 1920’s and through the 1930’s. Greenspan wrote that by bailing out the Bank of England‘s drastic devaluation of the pound, the US Federal Reserve “nearly destroyed the economies of the world,” JS Kim writes.

And he continues:

Though Greenspan’s words served as a strong indictment as possible of Central Bank failures to serve humanity and to only serve the greedy private interests that backed them, the whole world seemed to forget Greenspan’s words for the next 46-years.

Only today are people finally realizing the truth about Central Banks and the behemoth commercial banks that serve under them – that they have no interest in promoting price stability or full employment but only in transferring wealth from every single citizen of the world to themselves and the crony politicians that serve their interests.

Gold Related Assets (Source: World Gold Council)

Want to participate in smacking down the criminal global banking cartel? Here’s how to do it:

Sell the likely fraudulent SLV and GLD ETFs, cease participating in the fraudulent gold/silver futures markets, buy physical gold and silver, and buy gold/silver mining stocks.

The good news is(1) This is a simple strategy; and (2) Buy wisely, and you will likely build significant wealth while participating in this strategy.

The fraudulent immoral monetary system that bankers have imposed upon the world that steals money from savers and creditors and transfers wealth to governments, debtors and bankers can only be perpetuated by the price control mechanisms bankers have instituted for gold and silver.

Destroy these price control mechanisms and the fiat currency system will fail.And what happens if the fiat currency system fails?

We all have a chance to institute an honest and equitable monetary system that promotes price stability and sustainable growth instead of struggling under a dishonest one that destroys these desirable socio-economic qualities.

The ability of bankers to suppress the price of gold and silver (yes, even the price of $1,800 gold and $40 silver is severely suppressed) is based upon their ability to sell the perception that a much greater supply of silver and gold exists than actually does.

In fact, in this very newsletter, on April 27, despite all the PM media “experts” that tried to scare investors out of silver by claiming a silver bubble back then, we sent out an issue of this free newsletter titled “Silver is NOT a bubble” and then nearly called the exact bottom range of this silver correction for our paying members a couple of months ago.

Over the past six years, I have publicly blogged dozens of times regarding the mechanisms bankers use to accomplish the suppression of gold and silver prices, including most recently in my article, “Why Gold and Silver Prices Will More than Double Again Even from Current Prices.”

Smack That!

Current data provided by the CME regarding gold and silver futures contracts that trade on the COMEX reveal that about 100 times more paper gold ounces trade on this exchange every year than all the physical gold that exists in the world and some where around 160 times paper silver ounces trade every year than all the physical silver that exists in this world.

By expanding the supply of paper ounces of gold and paper ounces of silver at the same time that real physical supply of gold and silver are shrinking, the bankers have been able to suppress the price of gold and silver from reaching its true free market prices for decades.

The GLD and SLV very likely participate in this fraudulent scheme in helping to creating massive illusory supply of gold and silver that simply does not exist.

Thus if gold and silver are freed from the criminal global banking cartel’s scheme to suppress their prices, this will help all people in the world, even the Doubting Thomases, to recognize the fraud of our current fiat currency system.

Under our current monetary system, a businessman will never be able to receive the same value for the money he receives for any goods and services rendered unless he immediately spends all of said money.

The fact is,it is impossible for a businessman that holds fiat currency for services rendered for a duration of time any longer than a few months to then receive the equivalent value of that fiat currency when it was first received.

This fact about our current monetary system is a massive disincentive for any businessman anywhere in the world to work harder as the reward of additional nominal amounts of money can never be equivalent to the effort put forth.

Thus, our “modern” fiat currency system literally destroys any chance to achieve sustainable economic efficiency.

If a businessman works harder to earn 17.65%more money than last year, but that 17.65% boost in the nominal amount of money only enables him to purchase the exact same goods and services as last year due to an annual 15% inflation rate ($117,647 * 85% = $100,000), at some point and time, the destruction of efficiency that our fiat currency system imposes upon all businesses will inevitably lead to business contraction instead of sustainable business growth.

So how do we fight back against this unjust and immoral fiat monetary system created by Central Bankers?

Below are three simple steps we all can take. (1) Stop enabling banker fraud and realign your interests with the interests of humanity. Yes that means if you are long the GLD and SLV,or rollover long gold and silver futures contracts without ever takingphysical delivery, you are silently facilitating the banker war against humanity as you aid and a bet them in creating an illusory supply of gold and silver that simply does not exist. (2) Sell GLD and SLV shares and re-invest the proceeds of these sales into physical gold and physical silver and/or gold and silver miningshares. (3) Settle all long gold/silver futures contracts with physical delivery only and not in cash.

Gold stocks are a great value right now as you can see in the below chart. So are silver stocks as well. (Even though my Crisis Investment Opportunities newsletter has returned roughly a cumulative +220% over the past four years, since I believe gold/silver mining stocks to be the most highly undervalued asset class in the entire stock market now, I honestly believe that we will shatter those returns in the next four years.)

However, ever since introducing the GLD and SLV, bankers have successfully been able to steer money away from fundamentally solid gold and silver stocks into these likely fraudulent ETFs.

To see the above referenced chart and to read the rest of this article, click here.

Best investing,

JS Kim

Chief  Investment Strategist

SmartKnowledgeU

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Filed under International Econnomic Politics, National Economic Politics

Report: Financial Crisis Could Have Been Avoided

While the riots in Egypt dominate the news flow, one of the most important reports on the financial crisis is slipping through the cracks. Earlier this week, the US Financial Crisis Inquiry Commission released their final report, following the review of millions of documents, interviews with more than 700 witnesses, in addition to 19 days of public hearings. However, the conclusions are exactly the same as the Econotwist’s and many others have figured out a long time ago – the point of origin is not to be found amongst greedy bankers, compulsive-gambling-derivative-traders with unpredictable computer systems and faulty risk calculation formulas – because the policy makers and regulators knew all along perfectly well what was going on. Yet, they did nothing.

“The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done. If we accept this notion, it will happen again.”

Phil Angelides


The report by the Financial Crisis Inquiry Commission was handed over to US president Barack Obama last Monday. “Despite the expressed view of many on Wall Street and in Washington that the crisis could not have been foreseen or avoided, there were warning signs. The greatest tragedy would be to accept the refrain that no one could have seen this coming and thus nothing could have been done. If we accept this notion, it will happen again”  Chairman of the Commission, Phil Angelides, says in a formal statement.

The Commission’s main concluded is that the global financial crisis could have been avoided, and points out the following reasons to why we now are experiencing one of the worst economic crisis’ ever:

1. Widespread failures in financial regulation, including the Federal Reserve’s failure to stem the tide of toxic mortgages.

2. Dramatic breakdowns in corporate governance including too many financial firms acting recklessly and taking on too much risk.

3. An explosive mix of excessive borrowing and risk by households and Wall Street that put the financial system on a collision course with crisis.

4. Key policy makers ill prepared for the crisis, lacking a full understanding of the financial system they oversaw.

5. And systemic breaches in accountability and ethics at all levels.

I should, however, also be pointed out that not everyone in the Commission stands by the report.

These statements of dissent have been published along with the report:

Dissent Joined by Keith Hennessey, Douglas Holtz-Eakin, and Bill Thomas

Dissent by Peter J. Wallison

The FCI Commission concludes that the collapsing mortgage-lending standards and the mortgage securitization pipeline lit and spread the flame of contagion and crisis.

Over-the-counter derivatives contributed significantly to this crisis, and the failures of credit rating agencies were essential cogs in the wheel of financial destruction.

The Commission have also examined the role of government sponsored enterprises (GSEs), with Fannie Mae serving as the case study.

The Commission have found that the GSEs contributed to the crisis but were not a primary cause.

They had a deeply flawed business model and suffered from many of the same failures of corporate governance and risk management seen in other financial firms but ultimately followed rather than led Wall Street and other lenders in purchasing subprime and other risky mortgages.

According to the Inquiry commission, this is the reasons for the whole bloody mess:

“We conclude this financial crisis was avoidable”

“The captains of finance and the public stewards of our financial system ignored warnings and failed to question, understand, and manage evolving risks within a system essential to the well-being of the American public. Theirs was a big miss, not a stumble. While the business cycle cannot be repealed, a crisis of this magnitude need not have occurred. To paraphrase Shakespeare, the fault lies not in the stars, but in us.”

“Despite the expressed view of many on Wall Street and in Washington that the crisis could not have been foreseen or avoided, there were warning signs. The tragedy was that they were ignored or discounted. There was an explosion in risky subprime lending and securitization, an unsustainable rise in housing prices, widespread reports of egregious and predatory lending practices, dramatic increases in household mortgage debt, and exponential growth in financial firms’ trading activities, unregulated derivatives, and short-term “repo” lending markets, among many other red flags. Yet there was pervasive permissiveness; little meaningful action was taken to quell the threats in a timely manner. The prime example is the Federal Reserve’s pivotal failure to stem the flow of toxic mortgages, which it could have done by setting prudent mortgage-lending standards.”

“The Federal Reserve was the one entity empowered to do so and it did not. The record of our examination is replete with evidence of other failures: financial institutions made, bought, and sold mortgage securities they never examined, did not care to examine, or knew to be defective; firms depended on tens of billions of dollars of borrowing that had to be renewed each and every night, secured by subprime mortgage securities; and major firms and investors blindly relied on credit rating agencies as their arbiters of risk. What else could one expect on a highway where there were neither speed limits nor neatly painted lines?”

“We conclude widespread failures in financial regulation and supervision proved devastating to the stability of the nation’s financial markets”

“The sentries were not at their posts, in no small part due to the widely accepted faith in the self-correcting nature of the markets and the ability of financial institutions to effectively police themselves. More than 30 years of deregulation and reliance on self-regulation by financial institutions, championed by former Federal Reserve chairman Alan Greenspan and others, supported by successive administrations and Congresses, and actively pushed by the powerful financial industry at every turn, had stripped away key safeguards, which could have helped avoid catastrophe. This approach had opened up gaps in oversight of critical areas with trillions of dollars at risk, such as the shadow banking system and over-the-counter derivatives markets. In addition, the government permitted financial firms to pick their preferred regulators in what became a race to the weakest supervisor.”

“The Securities and Exchange Commission could have required more capital and halted risky practices at the big investment banks. It did not. The Federal Reserve Bank of New York and other regulators could have clamped down on Citigroup’s excesses in the run-up to the crisis. They did not. Policy makers and regulators could have stopped the runaway mortgage securitization train. They did not.”

“Yet we do not accept the view that regulators lacked the power to protect the financial system. They had ample power in many arenas and they chose not to use it. To give just three examples: the Securities and Exchange Commission could have required more capital and halted risky practices at the big investment banks. It did not. The Federal Reserve Bank of New York and other regulators could have clamped down on Citigroup’s excesses in the run-up to the crisis. They did not. Policy makers and regulators could have stopped the runaway mortgage securitization train. They did not.”

“We conclude dramatic failures of corporate governance and risk management at many systemically important financial institutions were a key cause of this crisis”

“There was a view that instincts for self-preservation inside major financial firms would shield them from fatal risk-taking without the need for a steady regulatory hand, which, the firms argued, would stifle innovation. Too many of these institutions acted recklessly, taking on too much risk, with too little capital, and with too much dependence on short-term funding. In many respects, this reflected a fundamental change in these institutions, particularly the large investment banks and bank holding companies, which focused their activities increasingly on risky trading activities that produced hefty profits. They took on enormous exposures in acquiring and supporting subprime lenders and creating, packaging, repackaging, and selling trillions of dollars in mortgage-related securities, including synthetic financial products. Like Icarus, they never feared flying ever closer to the sun.”

And for the conclusive remarks:

“The Commission’s statutory instructions set out 22 specific topics for inquiry and called for the examination of the collapse of major financial institutions that failed or would have failed if not for exceptional assistance from the government. This report fulfills that mandate. In addition, The Commission was instructed to refer to the attorney general of the United States and any appropriate state attorney general any person that the Commission found may have violated the laws of the United States in relation to the crisis. Where the Commission found such potential violations, it referred those matters to the appropriate authorities.”

 

But don’t think for a second that this is over. The healing process have just begun.

And – as I also have been emphasizing – it could take many years.

Now, back to Europe.

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Copy of the report: “CONCLUSIONS OF THE FINANCIAL CRISIS INQUIRY COMMISSION”

Copy of press release.

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Filed under International Econnomic Politics, Laws and Regulations, National Economic Politics, Philosophy

iRock: The Dollar And Its Diving (Great Recession Remix)

The talented folks at versusplus.com is out with another financial parody song – just in time for the Christmas holiday season – and the upcoming “Black Friday“…

The versusplus.com 2010 Holiday Songbook begins with “The Dollar And Its Diving (Great Recession Remix),” – an econoparody of “The Holly And The Ivy” (Traditional).

This new piece is an animated, Great Recession update of their original 2006 “Dollar” econoparody.

Here it is, “The Dollar And Its Diving” (Great Recession Remix) – Happy Holidays !

Download “THE DOLLAR AND ITS DIVING [Great Recession Remix]” song from iTunes (US): http://itunes.apple.com/us/album/the-dollar-and-its-diving/id405777954.

Watch “THE DOLLAR AND ITS DIVING [Great Recession Remix]” – and other hilarious econoparodies – on versusplus.com: http://versusplus.com or http://versusplus.com/dollar_2010.html (with parody lyrics).

More Financial Music Videos at iRock >>

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Filed under International Econnomic Politics, National Economic Politics