iCharts Discussions

[ajayhkaul]

"Government does not solve problems; it subsidizes them."
--Ronald Reagan

Last night's State of the Union address was chock full of bromides, class warfare and protectionism. ... it sounded much more like a campaign speech than a speech to inform the American people about where they stand as a nation. Although President Obama gets points for style, the substance of his words was sorely lacking. The basic issue US faces right now is should we depend on government to solve problems, or should we rely on the freedom of the individual to solve our issues? When answering that question for yourself, consider what President Reagan said about not SOLVING problems. With any luck, we won't let our nation become subsidized any further.

Revolt ?

[ajayhkaul]

[ajayhkaul]

And Silver , Vinay .... you had advance notice!


their plan to save the US and European economies? Keep interest rates low, and pump the markets with Trillions more in liquidity for at least three more years.
Which resulted in this:Gold/Silver blasting off like a rocket.

As I have been saying in my blog for over months, there's only two ways out of this crisis...

1: Default. (And social anarchy as 50% of the US population who get's a check from the gov, stop getting that check.)

2: Inflate away the debt by printing more Dollars, stealing citizens' wealth and savings in the process. With yesterdays' announcement and the subsequent actions to follow, "The Bernank" just picked pockets AGAIN.

[vinay28]

This is what I posted on 30th Nov : That the gold is becoming a new craze was clear when it started going up along with stock market two years ago.

Looks like we will be back to the barter system.

Now India is trying to pay Iran in gold for oil import since we can't transfer cash.

[vinay28]

Americans are already preparing themselves for bread-lines. And, it was Reganomics that killed the world economy in the long run.

By the way, have you read Johm Kenneth Galbraith's "The Affluent Society"? If not, a worth read!

[ajayhkaul]

“Strains in global financial markets continue to pose significant downside risks to the economic outlook.”
Talk About an Understatement!

Greece Is Nearing Default and Portugal Is Imploding ...

Europe is imploding right now and the Fed can only watch and wait.

Investors are already pricing in a Greek default, with 10-year bonds hitting a yield of 33%!

And while it’s easy to dismiss Greece as the black sheep of the European Union family, there’s also new trouble brewing in Portugal. The country simply can no longer compete in a single-currency monetary union.

And according to the Bank of International Settlements, Portuguese debt is now 479% of their entire country’s GDP!

This is why the country just came begging for another 30 billion euros in bailout money from the European Union and International Monetary Foundation’s rescue funds TODAY!


The Fed Can’t Paper Over These Problems ...
And America’s Day of Financial Reckoning Is Coming, Too!

Instead of providing a solution, the Fed’s easy money approach — one that continually gets extended out further and further into the future — is a SIGN of how bad things really are in the Western world.

And if anything, these insane policies are only making US mounting debts worse.

America’s Financial Doomsday ... the most dangerous phase of America’s great economic calamity is now beginning ...

America is actually in WORSE shape than Europe is right now — US great sovereign debt crisis is likely to be far more severe ...

The monumental event that now threatens to trigger the ultimate financial doomsday — it will plunge vast numbers of U.S. families into the nightmare of poverty, homelessness and hunger ...ANARCHY

Read ...Rise of Morons and collapse of an Empire in my blog posted months ago.

Friday the 13th April , 2012 ..... is doomsday ?

As per D Subbu , RBI , Indian banks' exposure in Europe is 60billion.
We know US has large exposure in Europe ....


[/i]

[ajayhkaul]

How far can gold go this time around ?

[ajayhkaul]

GET the BIG PICTURE ---- PETRODOLLAR WARS

While we track data like oil prices in dollars , do we stop and think why US imports so much oil when it is believed to have its own untapped resources ? And why does everyone have to pay that way ie in US dollar?

Maybe you know , maybe you dont...... but what follows will shake you : and soon the empire will collapse (see my post dated Aug 5,2011 ) or war will start !

Early 1970s President Richard Nixon severed the U.S. dollar’s last link to gold, making it a full fiat currency. This fateful decision was taken so the U.S. Government could print money without any institutional or legal restraints.

However, there was a limit to which foreigners were willing to accept a currency backed by nothing more than the "full faith and credit" of the U.S. government. The result was the U.S. dollar’s rapid devaluation and sharp price inflation.

The U.S. dollar’s fall was undermining America’s economic hegemony and threatening its status as a superpower. But politicians in Washington were unwilling to impose the fiscal discipline necessary to arrest the decline. So, they came up with the "petrodollar" scheme to shore up the U.S. dollar internationally, thus preserving America’s global position.

Petrodollars Recycled

1974: U.S. Secretary of State Henry Kissinger, Assistant Treasury Secretary Jack Bennett, and David Mulford of the London-based firm White Weld & Co. arranged a secret financial arrangement whereby Saudi Arabia would denominate all of its oil sales in U.S. dollars. A mechanism was then set up to handle the surplus "petrodollars" accumulated by the Saudis in a way that benefited the U.S. Treasury, the Federal Reserve banks, and the Bank of England.

Within a year, all OPEC members had been incorporated into the petrodollar system. This forced all oil-importing nations to amass surplus dollars and directed the flow of the world’s oil money into the United States, which increased demand for U.S. dollars and U.S. debt, even though the U.S. government was inflating and running large budget deficits.

Note that these oil producing countries had oil and nothing more than piles of sand and therefore it suited them to get filthy rich this way. So thats the US and Middle East nexus ?

The petrodollar system soon spread beyond oil transactions to include most world trade, which created a massive demand for U.S. dollars. Moreover, as foreign central banks accumulated U.S. dollars in their vaults, they invested heavily in U.S. Treasuries, giving the U.S. government a vast source of credit.

This "recycling" of petrodollars has permitted the United States to run large trade and budget deficits, maintain a global military empire, all the while expanding a domestic welfare state, and still have almost 70% of world trade conducted in its currency.

No doubt the petrodollar has boosted the U.S. economy and allowed Americans to buy imported goods at a lower price. But, this subsidy for American consumers has been a mixed blessing, for the availability of cheap imports has hit domestic manufacturing hard and eroded the country’s industrial base. It has also resulted in crushing debt, a corrupt and bloated financial system, and an economy teetering on the edge of collapse.

Another Petrodollar War

Now, in order to deal with the changing world economic order, American politicians could get reacquainted with fiscal sanity and implement the kind of policies that reward hard work, honesty, and frugality. Such an approach would allow the country to emerge from the current economic crisis stronger and, more importantly, at peace. Instead, the Washington establishment has chosen to continue printing and spending easy money, piling on debt, and relying on military power.

Of course, US political leaders don’t openly call for military domination of the planet so the United States can continue to plunder its resources. They cloak their ambition and greed in the language of liberation, democracy, and human rights. This has been the modus operandi of the American power elite at least as far back as 1898, when they maneuvered the country into a war against Spain to seize its colonies in the Caribbean and Pacific.

Perhaps this is how we should examine some of the major geopolitical events of the past 20 years:

The transmogrification of Saddam Hussein into an enemy of the United States had nothing to do with his brutal reign or his nonexistent arsenal of WMD’s, and very much to do with the petrodollar.

In September 2000, the Iraqi dictator made the mistake of announcing that he would be selling oil, not in U.S. dollars, but in euros. His decision went largely unnoticed by the mainstream press but it sent shockwaves through Washington, New York, and London. Iraq’s attempt to defy the dollar made his regime a genuine rogue state which could no longer be tolerated by the American Empire.

Libya’s Muammar Gaddafi made a similar challenge to the dollar’s hegemony when he proposed a gold dinar as Africa’s common currency and as the unit of payment for his country’s energy exports. Soon after, Gaddafi was toppled and brutally murdered by NATO-backed rebels.

The United States has imposed crippling sanctions on Iran’s oil and central bank and pressured the European Union into banning Iranian oil imports. These sanctions are supposedly intended to punish Tehran for its efforts to develop a nuclear weapon. But the U.S. intelligence community has concluded twice in the last four years that Iran is not pursuing nuclear weapons.

Like Iraq in 2003, the U.S. government’s belligerency towards Iran today has more to do with petrodollars than its alleged nuclear ambitions.
In 2003, Iran began accepting euros as payments for oil exports and introduced a plan to open a competing international oil exchange market based on the euro currency. This was an open challenge to the petrodollar monopoly which underpins American global power. It was at this time that Washington rejected an offer of rapprochement from Tehran and began its saber rattling.

The U.S. and EU embargoes are intended to isolate Iran and destroy its currency. But there are good reasons to believe the sanctions will fail in this regard. Iran has recently entered into a number of bilateral trade agreements with China, Russia, India, and Japan which exclude the dollar entirely. Such arrangements will allow Iran to effectively break free from the American stranglehold and could actually accelerate the de-dollarization of world trade.

As presidential candidate Ron Paul has pointed out, the U.S. actions against Iran’s economy are equivalent to a blockade, and are therefore an act of war. With U.S. warships plying the Strait of Hormuz, a real shooting war could break out at any moment.

This, of course, could be Washington’s objective: A Gulf of Tonkin like incident to provide a pretext for yet another petrodollar war.

http://www.youtube.com/watch?v=oUHmxBEZeU0&feature=player_embedded?cc=eletter&ct=ABP20120201A&cs=cgmo&sid=IQ7116&en=3751052

Hows this event going to effect the market ?

[ajayhkaul]

Since the credit crisis began in late 2007 to the end of 2011, there were a total of 417 U.S. bank failures whose assets totaled about $680 billion

It is the smaller regional bank that lends to small businesses in its community and supports job creation, not the big banks. And jobs are not being created.

The victim toll of the European Union’s recession is beginning to mount…
Spanair, Spain’s fourth largest airline, filed for voluntary bankruptcy on Monday. Will this be the first of many victims to come, as the recession in the European Union takes hold?

The Barcelona-based firm stopped operating as of last Friday, canceling 200 flights and stranding thousands of passengers across the European Union.

Spanair, a key Spanish carrier that began operations in 1986, pinned its hopes on a merger with Qatar Airlines, but unfortunately talks fell through. Since 2009, as it continued to struggle with the weak economy, the regional government of Catalonia provided €150 million to the airline to help it get through difficult times.

The problem is, those difficult times never subsided, bur rather intensified. After talks with Qatar failed, the airline returned to the government of Catalonia for another undisclosed sum of money. The government refused, due to the severe budget cuts it needed to implement for the austerity measures imposed on it by the European Union.

With losses mounting and with debt of over €300 million, the airline felt it had run out of options and time, with bankruptcy being the only solution.

Job losses ? 4000.This is compounded by the fact that the unemployment rate in Spain stands at a staggering 23.3%, with that economy showing no signs of turning the corner, as austerity measures continue to hamper growth.

The regional government of Catalonia not only spent €150 million in taxpayer money to keep the airline afloat, but it also owns 24% of the airline, which means that it further stands to lose an estimated €349 million.

This could be a harbinger of things to come in the European Union and throughout the world. Companies in distress seek government aid to help them through tough economic times. There are no funds left to bail out these companies, especially when austerity measures enacted by the European Union need to be adhered to.

Welcome 2012....turbulent times

[pkholla]

ajayhkaul: I had a book by Gibbon: "Decline and fall of the Roman Empire" and from what I remember, the last days of the Roman Empire look eerily similar to US/ West Europe today. No one willing to work, orgies and debauchery, high unsustainable standard of living, (the white waiter in a small hotel gets equivalent of Rs 150000 or more!), everything imported from "colonies", slaves to do the work.
For a few days, printing of Dollar 1 trn and Euro 1 trn will work but when the Chinese point out that the US/ Europe are like the King in the fairy tale: "The emperor's clothes" then we will have entire nations copying Spanair and nose diving! Regards Prakash Holla

[ajayhkaul]

True pkholla ... all empires have collapsed in the past for similar reasons!

[ajayhkaul]

Trouble in China ?

capital flight out of China has become even more intense in recent times. Part of the reason could be the political transition the dragon nation would witness in 2012. The consequences of such a transition have always been difficult to predict. Thus, the wealthy and well connected in China do not want to take a chance and hence, are moving their money out of China.

There is another reason such flows are getting more attention than they deserve. You see, with the developed world facing a slowdown, China's trade surplus with them is on a decline and this is thus making the capital flight look more egregious than before. Does this indicate all is not well with China and its problems run deeper than imagined?

where is the money going? Stay tuned ......

[ajayhkaul]

Another Moron on the rise in a collapsing empire?

"I will insist on a military so powerful no one would ever think of challenging it," adds Mitt Romney

But military spending is not a way to resist decline; it is a sign of it...and a cause of it. Osama bin Laden understood how it worked. By 2000, he had already brought one great empire, the Soviet Union, to its knees, luring it to spend money it didn't have in a war it couldn't win. He thought he could do the same to the US. So far, it looks as though he was right.

[vinay28]

true ajay and so it is with pakistan!

[ajayhkaul]

The Greatest Short Squeeze in the history of Silver ?

To be fully equipped to THRIVE in this ever-changing global economy…

You need to have your pulse on the hottest trends in energy… technology… currency… commodities… and even politics.

You need to know where the big money surges are headed – from investment banks, governments, industry and private investors – way before anybody else.

You need to know not just what's going on in India… but around the globe.

And you need to know exactly WHEN to get in, and more importantly… WHEN to get out.

OK ...so here is the story of Andrew Maguire , the whistle blower,his testimony to the CFTC… and a class-action complaint against the biggest financial players in the silver market. November of 2009, he signed on as an informant.

It was filed as Case No. 8157...

On March 26, 2010, Maguire saw the squealing car come careening out of a side road while he pumped gas into his own car at a London service station, his wife sitting in the passenger's seat. But it was too late.

The unidentified car plowed directly into Maguire's auto, almost killing him and his wife.

The mysterious car then sped on, smashing two other cars and nearly killing a pedestrian before it swerved back onto the road at high speed.

Armed with chase cars and helicopters, an army of London police pursued the would-be killer. And they ultimately nabbed the culprit.

Yet, strangely, their attacker's identity or whereabouts have never been disclosed.


So back to Silver ....

It all starts with the increasing scarcity of silver. According to some, the world has consumed so much silver in the past few decades that supply has collapsed by 95%.

The supply of silver has not been as low as it is today since the year 1300 A.D.

At the same time, demand for silver is increasing at an alarming rate.

And yet… the shocking truth is that the price of silver has dropped like a rock.

It defies all reason… because reason and fair trade have nothing to do with it…

During the summer of 2008, Andrew sensed something was going very wrong. It began about the time JPMorgan acquired Bear Stearns in March of that year…

In the purchase, Morgan took on Bear's enormous short positions on silver; that is, their billion-dollar bets that the price of silver would fall. And if it did, they would make a vast fortune.

The only problem was this: On the very day that Bear went out of business – March 16, 2008 – silver reached a multi-decade high of $21 an ounce.

For anyone who owned these bets… when the price of silver is rising… well, that's not a good position to be in.

The losses can be devastating – enough to push a trading unit (even a whole company) into bankruptcy, just like it did for AIG.

But within days of JPMorgan taking over these massive shorts, silver plummeted almost 17%. And over time, Morgan allegedly added heavily to that "short" bet.

According to the original complaint, JPMorgan, along with another international bank(HSBC), allegedly controlled over 85% of the commercial net short positions in silver futures contracts on the COMEX, by August 5, 2008, the suit claimed they were short 33,805 contracts – borrowed contracts that they would have to buy back at a lower price or else lose their shirts. They were potentially on the hook for a mind-numbing 169 million ounces of silver.

That would be equal to 20% of the entire world's annual mine production, or the entire COMEX warehouse stockpile, the second largest inventory in the world.

Somehow, they were very "fortunate." That is, if you can bend fortune to your will.

From March 16 onward, the price of silver began to decline, directly in their favor.

And it continued to sink. Like a stone.

Between July 14 and August 15, 2008 the price of silver declined from a peak of $19.30 to a low of $12.82 for a loss of 33%.

Then it hit rock bottom…

By October 2008, the price of silver was barely $9. The price of silver had been driven right into the ground. On the surface, the move was so irrational it defied all reason. For ordinary silver investors, the drop was catastrophic.

But, according to an amended class-action complaint filed in U.S. Federal court against JPMorgan…During just one day's price drop, from August 14 to August 15, 2008, JPMorgan allegedly pocketed approximately $220,000,000 in PROFIT.

$220 MILLION in just 1 day? If true, imagine the profit potential of the entire 7-month freefall.

In the face of lawsuits and negative press surrounding the accusations, JPMorgan "quietly reduced" their massive silver short position in August 2010.

Could it be coincidence that almost immediately, between September 2010 and April 2011, the price of silver TRIPLED from around $16 an ounce to more than $48 an ounce?

Reeling from huge losses in the silver squeeze that began in September 2010, it appears that the market movers decided to try and stop the bleeding by resorting to their old tricks.

In March 2011, JPMorgan's net silver short position, which had decreased by 11,000 contracts over the preceding three months to 19,000, suddenly ballooned to 25,000 contracts.

And without warning, on May 2, 2011, silver was attacked by short sellers once again.

Within 15 minutes, the price of silver plummeted 12%. By the close of trading on Friday, May 6, silver fell by a stunning 29.8%. Mysteriously, the price drop corresponded exactly to a rapid series of margin increases carried out by the COMEX.

Some analysts believe the margin increase was timed to keep the massive short positions from losing money. No one can prove it – yet. Still, it's a juxtaposition of events that cannot be accounted for. After all, 43 million ounces were held in short positions… in a market that was heading higher once again…

That's when the initial margin requirements skyrocketed from $11,745 to $21,600 – a whopping increase of 84%.

Thousands of investors had to dump their silver holdings like hot potatoes; at any price they could get; no matter how low or how much money they would lose.

Silver's use in industrial applications increased 20.7% last year to 487 million ounces.

That means as much as 50% of silver's total annual production is for industrial use… and that number is expected to rise another 36% by 2015.

As the world's greatest conductor of electricity – manufacturers use silver to make switches and fuses found in washing machines, computers, vacuum cleaners, drills, dryers and ovens.

In addition, billions of silver-zinc batteries are manufactured every year for use in dozens of electronic devices such as cameras, remote control car keys, TVs and watches.

The list of products that need silver is enormous – and constantly growing… including the two biggest areas of all:
Photovotaic cells used in smart phones (1.6 billion cell phones were sold last year)…
Silver's recent ascent as a leading antibacterial agent being used by hospitals and healthcare facilities around the world. Today, you can even buy silver imbedded band-aids.
Yet amazingly, silver prices remain well below the all-time high of $50.35…

And that was reached in 1980, more than 30 years ago.

In addition, the supply of silver is on a downtrend of historic proportions.

And that doesn't even tell the whole story. Did you know that unlike gold, silver is 98% consumable? Most people don't.

What that means is:

Of all the silver ever mined – about 46 billion ounces – experts estimate that only about 1 billion ounces are left above ground in bullion form.

(By comparison, of the 5 billion ounces of gold ever mined, about 2 billion are available above ground in bullion form.)

That's because the rest has been consumed. Most silver, such as the metal used in electronics, is not recoverable. There's no viable way to get it back for reuse.

In 1970 it is said there were 140 months of available above-ground silver, and by 1990 that shrank to 50 months. By 2010 it shriveled to perhaps as little as 11 months.

Even more telling…
The amount of silver coming out of the ground is going down every year…

Few, if any new discoveries have been announced in the past 10 years…

Most silver comes out of the last stages of existing mines (with the exception I mentioned above)…

The quality of silver mined is the lowest it's ever been… And…

Like most metals, silver isn't mined in veins anymore. It takes many tons of earth and rock to process even an ounce…
The details on supply and demand can fill whole books. Bottom line: Silver is in demand… It's harder to get… And manufacturers and investors will be paying through the nose to own it.

But there are two big changes right now that you need to know about.

These two new developments will likely free the price of silver (for a time, anyway) and make this historic run-up possible.

The first game changer is building steam and getting bigger by the day. It has certain players running scared. Yet it's playing right into the hands of those savvy enough to get in early.

Recently opened Hong Kong Mercantile Exchange is about to rewrite the book for silver buyers around the globe. It's going to make it very rough for the schemers to use their same tricks.

You see, this is the first time in history that the Chinese (and silver investors all across Asia) can purchase silver futures contracts… and actually take delivery of the metal – in Hong Kong no less.

There's little doubt that this will quickly become the gateway to silver into China – and likely all of Asia.

No longer will the enormous Asian market have to answer to Wall Street when it comes to buying silver.

Take a second to think how much of an impact this could very well have on the silver market.

Today the Chinese are the biggest consumers of silver on the planet – accounting for an astounding 23% of global silver consumption last year!

In fact, in 2010 silver demand rose 67% in China alone. And this number is expected to increase dramatically in the next several years.

And even better: It comes at a steep discount too.

You see, for those who want to trade silver futures contracts, the new Hong Kong Merc only requires investors to buy "in" with a 1,000 troy ounce minimum.

This is dramatically less than what is required back in the states where the minimum contract allowed by the CME is 5,000 troy ounces.

What's more, the Hong Kong Merc has signed up a whopping 22 of the biggest brokerage trading firms in Asia.

It's already setting up a squeeze with the potential to be one of the biggest in the history of silver.

The last silver squeeze saw silver skyrocket from $16 to $48 an ounce. But with the rise of the Hong Kong Merc, the inevitable coming super squeeze could easily dwarf those returns.

The Pan Asia Gold Exchange (PAGE) is about to open soon. Estimates are by June 2012…

Again, please commit this date to memory: June 2012. It could be one of the most significant moments in financial history. A moment that can put a decade of market misery behind you.

PAGE will enable all 320 million retail customers – and 2.7 million corporate customers – of the giant Agricultural Bank of China to simply use their Renminbi, the Chinese currency, from their bank accounts to trade gold and silver.

So what happens to Silver in view of the above ?

Keep your eyes peeled and ear to the ground.....and being in the right asset class at the right time can change your life.....forever.