The great euro Putsch rolls on as two democracies fall

So much for democracy, if one pays close attention to what happens behind the media veil, the corporatocracy is surely taken over, where freedom used to prevail, now its all about aligning with the plan of the privately owned institutions and banks. This article is def. worth a read. 🙂

-Anders

The great euro Putsch rolls on as two democracies fall

Monday, November 14, 2011 At 12:00AM

By Ambrose Evans-Pritchard, International Business Editor of The Telegraph:

As I long feared, the flood of cheap credit into Southern Europe and the slow death of Club Med industry by currency asphyxiation have together created such a dangerous situation for world finance that informed opinion is willing to turn a blind eye to EU sovereign trespass. Some even applaud.

The Greeks were ordered to drop their referendum on measures that reduce their country to a sort of Manchukuo, with EU commissars “on the ground”, installed in each ministry, drawing up lists of state assets to be liquidated to pay foreign creditors.

Europe had the monetary and fiscal means to contain the EMU debt crisis long enough for Greeks to give or withhold their crucial assent to this ultimatum in December.

It chose – under German-Dutch pressure – not deploy those means. Instead it forced Greece to capitulate by cutting off an agreed loan payment.

In Italy, the European Central Bank has engineered the downfall of Silvio Berlusconi by playing the bond markets, switching purchases on and off to enforce compliance with its written dictates (“La Lettera”), and ultimately allowing 10-year yields to spike to 7.45pc to drive him out.

Europe’s president Herman Van Rompuy swooped in to Rome to clinch the Putsch. “Italy needs reforms not elections,” he said.

We are not that far from use of EU judicial coercion, and then EU police power, and ultimately EU “border troops” – for those old enough to remember Soviet methods of fraternal assistance.

Chancellor Angela Merkel tells us that peace in Europe can no longer be taken for granted, and she is right. Her own Gothic actions and her inflexible imposition of 1930s Gold Standard contraction and debt-deflation on Southern Europe is itself preparing the ground for Europe’s civil war (hopefully pacific), a rebellion by the South against the North.

Italy’s youth are turning. Watch the footage of students chanting “democracy” and brandishing their “95 Theses” of Wittenberg revolt as poet Van Rompuy tried to speak in Fiesole.

“No to Austerity,” starts the Luther List: “Troika out of Greece”, “IMF and ECB out of Italy, Ireland, and Portugal”, it goes on.

“The EU has become ever less accountable to the people of Europe. The undemocratic structures have infiltrated the very structures of the Union,” they said.

Behold “the EU’s furious reaction to the Greek government’s effort to seek popular consent over the financial stranglehold imposed on the country. No longer are expressions of popular consent simply ignored, it is now impermissible to consult citizens.”

Let us agree that Greece’s Lucas Papademos and Italy’s Mario Monti are excellent men (Mr Monti has been picked for the task by President Giorgio Napolitano, himself a former Stalinist who later switched his loyalties to the sublime Project).

But the two good men also represent the EU enforcement machine. Papademos was ECB vice-president. Monti was an EU commissioner for ten years.

Professor Monti enjoys great goodwill in Rome but it is far from clear that he can put together a durable government able to implement Project demands.

Antonio di Pietro’s Party of Values has spurned a technocratic regime that lacks democratic legitimacy, saying Italy is “under EU tutelage”. La Lega Nord’s Umberto Bossi has denounced the stitch-up.

“The game is getting dangerous,” said Il Sole. Some suspect that the Berlusconi camp would not do too badly in snap elections, if allowed, campaigning against the “hated euro and EU bosses”. Is that why Brussels is now so afraid of Italy’s voters?

If Mr Monti relies on the Left, how can he comply with EU orders to break the power of the trade unions and impose “Anglo-Saxon” wage-bargaining? A large bloc in parliament will die in a ditch to defend Article 18 of the labour code.

Labour minister Maurizio Sacconi warned last week that careless handling of this issue threatens to unleash another round of terrorism in Italy. It is only nine years since Marco Biagi was assassinated by the Red Brigades for threatening the sacred cows of the Sindicati.

No doubt Italy needs a blast of Thatcherism. The country has fallen down the World Bank rankings in ease of doing business from 74 (2009), to 76 (2010), to 80 (2011).

Its average economic growth rate has been 0.6pc over the last decade. Productivity and per capita income have declined, and this before the demographic crunch hits with a vengeance.

The old age dependency ratio will reach 59pc by mid-century, compared to 56pc for Germany, 45pc for France, and 38pc for the UK, according to Commission data).

But those of us who wrote years ago that Italy’s sclerosis and inflation proclivities were going to cause a train-wreck within the rigours of EMU were told by Europe’s authorities to curb our insolence.

In 2009 the European Commission praised Italy’s “spectacular job creation” and its “greater resilience to external shocks”. In 2008 in said Italy was making “good progress” on the Lisbon reform agenda. In 2007 it said Italy’s debt sustainability risk was “broadly in line” with France and Germany.

Italy’s four sets of pension reforms were held out as a shinging example. Finance minister Giulio Tremonti was feted in Brussels, lauded for his iron discipline and primary budget surplus.

And now these same EU bodies tell us that Italy’s failure to grasp the nettle of reform and tackle its debts is so egregious that Europe must step in to overthrow an elected government.

Let us end this EU lie – propagated by Berlin’s uber-bully Wolfgang Schauble – that Italy is suddenly guilty of economic crimes and debt debauchery.

Read the rest of the article here:

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Death by 1,000 Cuts

Death by 1,000 Cuts
By: Neeraj Chaudhary, Investment Consultant 

article3With the US stock market’s recent volatility, many investors may be wondering whether or not we are headed for another 2008-style crash where the market drops 30 to 40 percent within a few short weeks. Sensing that timing could be critical, many investors may be sitting on the sidelines waiting for a good entry point. But this dynamic misses that far bigger picture: Notwithstanding the bull and bear cycle over the past decade, the entire market has been slowly sinking. As a result, a well timed entry into US stocks may not be enough to deliver long term results.

The majority of investors who have been holding US stocks for the better part of a decade have seen their real wealth diminished.And even if the market does not collapse as it did in late 2008, US stock investors will likely continue to bleed away real wealth for the foreseeable future, as the dollar itself continues to shed value. As we dismantle our economy piece-by-piece, through seemingly unending bailouts and stimulus, real wealth – and real stock prices – will continue to flow abroad.


Source: Yahoo Finance.  S&P 500 from August 2000-October 2011.

To see this big picture, we must look back to August 2000. At that point the tech stock bubble had just started to pop, but its effects had not yet been felt in the wider economy. That month, with investors still flush with the optimism of the late 1990’s, the S&P 500 Index hit an all-time high of 1,4611*. At the time, the cheerleaders predicted that the United States would lead the free world into a 21st century capitalist dream, with a perpetually growing economy and permanently rising stock prices.

But then something funny happened on the way to the mall. For the next eleven years, US stocks went nowhere. While there was indeed much volatility in the decade (such as the crash of 2008, and the ensuing two-year rally that restored stock prices to their pre-crash levels), long term stock market returns were essentially non-existent. By May of this year the S&P 500 was at 1,3381, about 8% below its nominal value in August 2000. While an 8% decline is no victory, it is not quite a tragedy either. The problem, however, is that these seemingly mild declines are greatly magnified by the falling dollar.

Using 2011 dollars as a yardstick, the August 2000 S&P 500 high would not have been 1,4611, but actually 1,9521. If adjusted for this inflation, the S&P 500 fell an astonishing 31% to May 2011. In other words investors have lost nearly one-third of their real wealth since 2000. These losses did not only occur in the 2008 crash, as many market cheerleaders insist. They came cut-by-cut, over the past eleven years.

It is this expression of wealth – where a 31% loss of real wealth is represented as a more benign 8% loss of wealth – that is not recognized. The Federal Reserve can pump liquidity into the markets, causing nominal stock prices to rise, yet ignoring the lost purchasing power.

It is worth noting that all of the inflation numbers that Dr. Shiller used to calculate real stock values are based on US CPI as currently calculated by official sources. However, throughout the 1980s and 1990s, the US government made significant changes to the way CPI is calculated. These changes had the cumulative effect of dramatically reducing the rate of reported inflation. If CPI had been instead measured using the formula in use prior to 1980, inflation would have averaged at least 6% annually from 2000-2011. If these measurement techniques had been held in place, investor losses of real wealth to inflation would have been higher during this period.

The moribund market seems to have reduced confidence in the time tested “buy and hold” strategy. Instead investors hoping to actually make money may now be choosing risky market timing strategies or loading up on particular companies or sectors that they hope will outperform. Certainly, some have been successful. But a larger number are likely on  the losing end of those trades. But a falling equities market is a drag on the overall economy beyond Wall Street.

Looking ahead, if there is a repeat of the 2008 crash, Ben Bernanke himself has indicated that the Fed will rush in and pump the markets up again with liquidity. And, as they did in 2008, stock prices may once again rise to their pre-crash levels. But when the dust settles, investors may see another large bite taken out of their portfolios as a result of high inflation.

So let the cheerleaders soft pedal the dips, celebrate the rallies. At the end of the day, the US market appears to be just chasing its tail. However, we believe the buy and hold strategy is still in effect in many world markets, where robust real gains have been delivered over the past decade.

1 http://www.econ.yale.edu/~shiller/data.htm

* In order to provide a data series that may be used in conjunction with US CPI data, Dr. Shiller uses average values for each month of his S&P 500 data.

Neeraj Chaudary is an Investment Consultant with Euro Pacific Capital. Opinions expressed are those of the writer and may or may not reflect those held by Euro Pacific Capital, or its CEO, Peter Schiff.

Eric Sprott speaks at the Casey Research/Sprott Summit When Money Dies.

http://bit.ly/whenmoneydies Eric Sprott speaks at the Casey Research/Sprott Summit When Money Dies.

The sold-out When Money Dies summit was a huge success, with attendees and participants alike receiving much to think about. If you missed it, you can still “be there,” via a full set of audio recordings. These are available now, in CD or MP3 format for your convenience. http://bit.ly/whenmoneydies

 

History of Gold

Gold is one of ten metal elements of antiquity. The oldest known discoveries of gold date back to the 5th millennium, before the birth of Christ. Egyptian Pharaohs were heralded and worshiped as descendants of the Sun God. They considered gold to be a divine metal. Gold was present during burial processions as a means to attain immortality. A deceased Pharaoh was occasionally covered in gold and burial chambers filled with objects made out of gold and silver. February 16th 1923 – Howard Carter’s discovery of Tutankhamun’s tomb reveals a Pharaoh’s sarcophagus. Encased within are three gold coffins nested within each other, the innermost consisting of solid gold and weighing more than 108 kilograms. The burial chamber contained chariots made out of white gold, golden daybeds, statues and Tutankhamun’s wooden shrine, covered in gold leaf applied to a layer of stucco.

The Roman Empire was partially built on looted gold and silver. In three hundred years, the Romans controlled all the mines and troves of the known world. Gold and silver was accepted currency and the opulence of Roman life was attested with gold adornments and statues. The Romans were familiar with a gold purification method consisting of smelting with lead, table salt or chalk

Christopher Columbus’ search for the Indies was driven by his quest for gold. With the fall of Constantinople to the Ottoman Turks in 1453, the land route to Asia became much more hazardous. His attempts to navigate westwards across the Atlantic brought him to the Americas instead.

In the 16th century the Spanish conqueror Hernández Cortés landed close to what is known today as Vera Cruz and subdued the people of the Aztecs. The Aztec King, Montezuma welcomed the Spaniards with gifts of gold however this incited greed amongst the Spanish who eventually executed the king and subsequently looted and destroyed the Aztec capitol. The Aztec people were callously slaughter and hordes of Aztec gold transported promptly back to Spain. History tells of many variations to this story, the same faith befalling the Incan King, Atahualpa who was also executed by the Spanish conqueror Pizarro in 1532. The systematic annihilation of thousands of American Indians by western settlers in the United States in the 19th century would be yet another example of how gold was considered a prized possession gained at all cost, much to the demise of civilizations.

During the Middle Ages, alchemists attempted to artificially synthesize gold from other substances with the use of a method called ‘transmutation’. This had never been achieved before. They regarded cinnabar and mercury to be the preliminary stages of what is called the ‘Philosopher’s Stone’. This substance was conceived from a magical substance with properties consisting of cheap metals and lead which were then turned into gold. In its original form, the alchemist symbol or glyph for this substance is represented by a ‘squared circle’ or otherwise termed ‘squaring the circle’.

Properties

Gold is a lustrous precious metal of golden yellow color, consisting of a very high density and is the most extendable of all metals. One gram of gold can be into a wire three kilometers long. The metal can be rolled out into sheets of gold as thin as one micrometer. In its translucent form, gold changes from its yellowish luster into a greenish blue color. Gold can be alloyed with other metals. When combined with mercury, Amalgam is produced. Along with silver and copper, gold is one of the three best conductors of heat and electrical current. Gold is a very inert and a corrosion-proof material. It does not react with air, water, or acids. Chlorine and ‘aqua regia’ (Latin: royal water) are the only 2 solvents with the ability to dissolve gold.

Deposit

Gold belongs to the seldom elements and ranks 75, above platinum on the chart of elemental abundances. It can be found in the earth’s crust up to a depth of 16km with a cold content of 4.1mg/t in rock. Iron-meteoroids have an average content of 1.8g/t while seawater contains 1-2 microgram per cubic meter. In nature, gold is mainly found as elemental pure gold and is almost always contaminated with silver and other metals such as copper, bismuth and mercury. Gold with a silver content of more than 30% is called Electrum. Grains, lumps or ‘Nuggets’ can be found in river sands and extracted through a process called gold panning.

Up to date, the largest nugget discovered was found in 1869 at Moliagul, Victoria, Australia by two prospectors, John Deason and Richard Oates. The nugget weighed gross, over 2,520 troy ounces (78 kg) and returned over 2,284 troy ounces (71.0 kg) net.
It was called “Welcome Stranger” and sold for £9,381.

Nuggets are originally derived from silica deposits and separated through water erosion. Die to its high density, the eroded grains settle as river sediments, called ‘placers’. Other minerals such as silica and pyrite can be contaminated with gold.

The largest occurrence of gold has been mined along the Witwatersrand Range in the Republic of South Africa. Gold concentrations in this range have been reported to be up to 45g/t of silica rock. Significant occurrences of gold have also been found in the Californian Gold Country (Mother Lode Region) and in Cripple Creek, Colorado. Alaska, Canada, The Ural Mountains of Eurasia, Ghana, and Zimbabwe have also reported significant finds. More recently, the largest gold nugget discovered, weighed in at 71 kg and was mined in Kalgoorlie, Australia. The most significant occurrences in Europe can be found in Transylvania. In Germany, this rare metal (along with other precious metals) is extracted from copper pyrite and galena and contains roughly one gram per ton of ore. Worldwide gold occurrence is estimated at around 60,000 tons. The world’s seas are thought to contain several million tons of gold however; this source of gold is currently not considered economical to mine.

Gold Extraction

The oldest method for extracting gold is by placer mining. This process involves the slurring of river sands, whether in an industrial facility or by means of a simple washing pan resulting in the gold nuggets or flakes to settle at the bottom or the edges of the pan due to its high density.

Currently, two types of industrial extractions play a significant role in the processing of gold. The Amalgam process involves the grinding of rocks with the use of mills. Gold extracted through this process is then mixed with water and mercury. Gold forms an alloy (amalgam) when mixed with mercury and it is subsequently distilled at 600°C. This process yields two thirds of the gold from the rock composite. In order to obtain the remaining gold, leaching with cyanide is applied. A process invented in 1887 by the two Scotsmen MacArthur and Forrest. The finely ground rock is mixed with a solution of sodium or potassium cyanide and oxygen is applied through an aeration process. The gold forms a complex cyanide compound from which it is then purified through reduction with the use of zinc flakes. It settles on the bottom as sediment. This sediment is then filtered, dried, and baked by using a fluxing agent such as borax. It is then melted and cast into bars.

Usage

Gold was once an important currency metal but has lost this function since 1978. Roughly two third of gold reserves are held in national depositories as monetary reserves. Compared to platinum, gold plays a minor role in technology as cheaper substitutes have since been manufactured. Gold is still however significant in dentistry and used as dental gold. Within the electronics industry, gold is used in the manufacture of contact points for switches, optics for high-end mirrors, solar glasses, and reflectors for satellites. Galvanized application of gold to objects for protection against corrosion has its significance, particularly in space travel. Sheets of gold, the thickness of 0.1 micrometers are also used to decorate objects in the restoration of art. ‘Purple of Cassius’ is a gold coloring process which has occasionally been used on glass and porcelain. Such objects attain a strong ruby red color, which is the result of the presence of colloidal gold.

  • Gold (from Indogermanic ghel: shining, (yellow)) is a chemical element and a precious metal, the chemical abbreviation Au for gold goes back to the Latin name of aurum.
  • Gold consists of only one stable isotope. This heavy metal is as soft as tin and remarkably colorful. It is generally not affected by acids; one exception being the acid mixture “aqua regia”, a combination of hydrochloric acid and nitric acid. Gold cyanidation with the use of liquid cyanide solutions and oxygen concentration will convert gold to a water soluble coordination complex. It also dissolves easily with many different metals. Some of its unusual properties, such as its golden yellow color and its ductility is best explained by the Relativist Effect applied in quantum chemical and relativistic mechanical arguments to explain elemental properties and structure, especially for heavy elements of the periodic table.
  • Gold has been used for millennia as jewellery and gold coins as a means of payment. It is one of the preferred coin metals for collectors and enthusiasts.

Facts

In recent times, gold is more commonly extracted through the gold mining process. Gold, in its natural state tends to take the form of nuggets which is usually smaller than 3 mm a piece. A sample of a nugget can be seen in the image below. Often, gold dust is the only end product. In 10 tons of rock, a couple of grams of gold might be extracted or perhaps even less. It is separated from the rock composite with the use of various acids. This is a complex and costly procedure, though still regarded to be profitable.

The history of money and banking

THE AMERICAN DREAM takes an entertaining but hard hitting look at how the problems we have today are nothing new, and why leaders throughout our history have warned us and fought against the current type of financial system we have in America and most of the civilized world today.You will be challenged to investigate some very entrenched and powerful institutions in this world,and hopefully encouraged to help get yourself and our world back on track.

I find this little 30 min. film VERY informative, and gives great insight into how our financial system works and how it came about. If it’s the first time you see history presented this way, you will be horified, how ever you – the people – holds the power to your own salvation, so don’t worry.

Before i get any more up my own ass, with revolutionary thoughts, I will let you decide what you think and read your comments and come with my feedback in the following posts. 🙂

To your success,

Anders

Hello world!

Welcome to GoldNewbie,

A blog for you, that’s new to the principles of sound money, gold, and investing in precious metals as a means to protect yourself from what ever crisis the financial industry and media will come up with, whether it’s a financial, debt or intelligence crisis. 😉

In the end, you’re the only one that truly has an interest in gaining enough knowledge to survive and rise your living standards.

I’ve created this blog in order to:

  1. Spread awareness, create interest and educate, you and myself, so we can make better financial decisions for ourselves and the ones we love.
  2. Gather and share information,  knowledge, tools and experience, so we can avoid making the same mistakes twice.
  3. Show the practicle step by step process on how to buy and invest in gold and other precious metals

Here are some suggestions for your first actions.

  1. Read and watch the suggested videos about the story of money and role gold has played over the centuries, here.
  2. Get yourself up to date with the latest news and trends, and find out how to buy actual gold, here.
  3. Comment, share and give your feedback on blog

I look forward to be apart of this community, if you have any questions that’s not answered in the FAQ, or you just want to get in personal contact don’t hesitate to send me an email.

To your success,

Anders Hage