Wednesday, January 12, 2011

'Our savings have vanished – we've lost everything'

If only they had kept their savings in Gold and Silver as instructed in the Koran.....

From Reuters:

Chanting investors accuse brokers of dishonesty at Dhaka's stock exchange

Police in Bangladesh used tear gas and water canons to disperse angry protests by crowds of small investors after a dramatic free-fall plunge on the country's stock market caused the authorities to suspend trading.

Hundreds of outraged investors took to the streets outside the stock exchange in the Motijheel neighbourhood of the nation's capital after the worst plunge in the country's history saw the Dhaka Stock Exchange (DSE) fall by 660 points, or 9.25 per cent, in less than an hour.

Chanting slogans that accused brokers and traders of manipulating stock prices and of the government of failing to properly regulate the situation, the small-scale investors smashed up cars, burned tyres and ran loose until police stepped in to break them up. There were other protests in smaller cities and towns. Four journalists were reportedly beaten by on

Bankers will take bonuses because they weren't praised last year, says Lord Jones

What a typical bullshit banksters weep this story is, "oh we will leave the UK if we don't get our multi-million pound bonuses" well go on then, f**k off the lot of you! go be Romanian tax collectors or something.

The situation is similar in Australia, the banking CEOs think they are doing God's work and want praise from the masses for doing it. A few years ago I had to endure my daughter's school speech night where the guest speaker was the CEO one of Australia's largest banks (she was a school "old girl"). Even though I had steeled myself with a double shot coffee she still put me to sleep rabbiting on about work life balance, glass ceilings and gender inequality....zzzz. If that is the caliber of the chosen ones we are in trouble, my suburban tax accountant would make a better bank CEO.

From the UK Telegraph:

Lord Jones, the chairman of HSBC's international advisory board, has said that bankers will take bumper bonuses this year because those that sacrificed big cash rewards last year received "not one jot of praise".

Speaking to The Daily Telegraph, the former Labour minister conceded that the "lack of sensitivity" among some parts of the banking community continued to amaze him.

But he added that the bosses who had foregone their bonuses had very little incentive to do the same again.

"To be fair, when the chief executives of the major banks sacrificed their contractual entitlements to bonuses over the past couple of years, or gave the cash to charity, not one jot of praise or even understanding came their way," he said.

He argued that the banks instead faced compelling business reasons for not reducing pay-outs. "So why, they may think, bother [reducing bonuses] when the rest of the world's banks are enticing staff away every day?"

Lord Jones, who was also former director general of the CBI, warned the Government not to go further than the rest of the world in its attempt to curb City pay.

"Tax bonuses in isolation - that is, without the rest of the world following suit - and talent will leave the UK," he said.

The comments from the City heavyweight come amid mounting political tension about the investment bank bonus payments which will be finalised over the next few weeks. Experts have estimated the big banks could award nearly £7bn in bonuses this on

How The Government Spins Unemployment

By Paul Craig Roberts

The Bureau of Labor Statistics (BLS) reported Friday that the economy gained only 103,000 new jobs in December--not enough to keep up with population growth--but the rate of unemployment (U.3) fell from 9.8% to 9.4%. If you are confused by the report, you are among the many.

In truth, what fell was not the number of unemployed people but the number of unemployed people who are actively looking for work. Those who have become discouraged and have ceased looking for work are not considered to be in the work force and are not counted as unemployed in the U.3 measure. The unemployment rate fell because discouraged workers increased, not because employment rose.

The BLS counts short-term discouraged workers (less than one year) in its U.6 measure of unemployment. That unemployment rate is 16.7%. When statistician John Williams ( adds the long-term discouraged, the US unemployment rate as of December 2010 was 22.4%.

The question to ask yourself is: why does the media focus on the unemployment measure that does not count any discouraged workers? The answer is that the U.3 measurement only counts 42% of the unemployed and makes the situation appear to be a lot better than it is.

Where are the 103,000 new jobs? As I have reported for years, the jobs are in non-tradable domestic services: waitresses and bar tenders, health care and social assistance (primarily ambulatory health care services), and retail and wholesale trade.

Today the United States has only 11,670,000 manufacturing jobs, less than 9% of total jobs. Yet, despite America's heavy dependence on foreign manufactures and foreign creditors, the idiots in Washington think that they are a superpower standing astride the world like a colossus.

John Williams reports that "the level of payroll employment still stands below where it was a decade ago, despite the U.S.population growing by more than 10% in the same period. The structural impairments to U.S. economic activity continue to constrain normal commercial activity, preventing any meaningful recovery in business activity."

Another way of saying this is that American corporations have taken American jobs offshore and given them to the Chinese. So much for big business patriotism.

Williams also reports that, unless it is finagled, next month's BLS benchmark revision of payroll employment data will lower the level of previously reported employment by more than 500,000.

Federal Reserve chairman Ben Bernanke used his testimony before the Senate Budget Committee last Friday to warn that the U.S. government must get its budget deficit under control or "the economic and financial effects would be severe." Here Bernanke is acknowledging that the Federal Reserve cannot indefinitely print money in order to finance wars and bailouts of the mega-rich.

But how is the government to get its budget under control? The U.S. government, regardless of political party or president, is committed to American hegemony over the world. The Congress has just passed the largest military budget in history, and there is no indication that any of America's wars and military occupations are near an end.

The financial crisis is not over, with more foreclosures and more losses for the financial sector that will result in more taxpayer bailouts for those "too big to fail." John Williams says that the double-dip is already happening, just disguised by faulty statistics, and that the deficit implications are horrendous and are likely to result in hyperinflation as the Federal Reserve will have to monetize the otherwise un-financeable deficits.

The dollar is also in danger, its role as reserve currency undermined by the Federal Reserve's creation of more and more dollars. Temporarily, the dollar is buttressed by the grief that Wall Street's sale of fraudulent derivative financial instruments to Europe
has caused the euro.

The Republicans will try to destroy Social Security and Medicare in order to pay for wars and bailouts. If Americans are capable of realizing that they are threatened on a much greater level by the Republicans' evisceration of the social safety net than they are by terrorists, the Republican assault on what they call "the welfare state" will fail.

The fallback target will be private pensions, assuming any survive plunder by the Wall Street investment banks. Pension funds could be required to invest in Treasury debt or they could face a levy. In the Clinton administration, Assistant Secretary of the Treasury Alicia Munnell proposed confiscating 15% of all pension assets on the grounds that they had accumulated tax free. Certainly Washington will steal Americans' pensions, just as Washington has stolen Americans' civil liberties, in order to continue the empire's wars of hegemony.

Increasingly, the rest of the world views America as the single source of its financial and political woes. While the superpower massacres Muslims in the Middle East and Central Asia, people in the rest of the world have learned from WikiLeaks that the U.S. government manipulates, bribes, threatens, and deceives other governments in order to have those governments serve the U.S. government's interest at the expense of the interests of their own peoples.

The American Imperial Empire rests on puppet governments that are increasingly distrusted and hated by the peoples under their rule. Like the Soviet Union's Eastern European empire, the American Empire is ruled not directly but through puppet states.
Puppet governments are caught between the empire's power and the power of the local population. To the extent that Europeans have a moral conscience, they will find America's foreign policy increasingly repugnant. To the extent that Muslim solidarity grows, the Muslim puppet governments that support America's and Israel's massacres of Muslims will find themselves threatened from within.

The American Empire is on the rocks, despite its vast arsenal of nuclear weapons and its control over the foreign and domestic policies of its subservient puppet states in Western and Eastern Europe, the United Kingdom, Canada, Australia, parts of Africa, the Middle East, Japan, Thailand, Indonesia, the Baltic states, Georgia, Kosovo, Mexico, Central America, Columbia, and, no doubt, others.

A country that is the font of war and oppression, whose dominance rests on the weak reed of puppet states, and whose economy is collapsing will not long remain dominant.

Economic Precipice Near?

Keiser Report: Curse on Taxes

Australia's Reserve Bank's gold sale cost us $5bn

I have been looking for this story to surface for about the last five years, it is Australia's "Brown's Bottom" moment. It just goes to show the Central Bankers and Politicians in Australia are as much a bunch of short sighted tossers as the ones in the UK and US.

From The Australian:

The RBA revealed in July 1997 that over a six-month period, it had sold 167 tonnes, reducing Australia's reserves to just 80 tonnes. At this time, the value of its gold assets fell from $3.6bn to about $1.1bn.

The RBA's sales pushed the world gold price down to an 11-year low, returning just $2.4bn for the gold that was sold via a single broker engaged without a tender.

The same amount of gold would be worth about $7.4bn today.

The decision to sell the reserves was approved by then RBA governor Ian Macfarlane and then treasurer Peter Costello.

The paper justified the decision to dramatically reduce the bank's holdings by arguing that gold had been a poor investment, and that Australia need not worry about access to financial markets during another economic crisis.

Since this decision, the world financial system has suffered severe stress, first with the dotcom bust in 2000, then the 9/11 attack the following year and, more recently, the near collapse of the global financial system in 2008.

The spectacular rise in the price of gold in recent years shows that it is clearly playing a role in the GFC and its on

The Financial Crisis, the Recession, and the American Political Economy: A Systemic Perspective

Charles Ferguson PhD '89

November 9, 2010
Running Time: 01:28:14

You're insane if you don't own gold, investors told

From the UK Telegraph:

Not owning gold during the current financial turmoil is "a form of insanity", according to an investment analyst at a leading City firm.

Robin Griffiths, a technical strategist at Cazenove Capital, told CNBC: "I think not owning gold is a form of insanity. It may even show unhealthy masochistic tendencies, which might need medical attention."

He added that the dollar was heading for "oblivion".

Mr Griffiths predicted that gold's 10-year bull run would continue and even intensify. "Although it's been a top performer for each of the last 10 years, it's still in a linear trend," he said. "Eventually it will go exponential and make more in the last little bit than the whole of the 10-year trend."

He said investors should regard any short-term falls in the gold price as a buying opportunity, adding that gold was still not an "over-owned trade".

His comments come against the background of the US Federal Reserve's huge monetary stimulus from quantitative easing, which many believe will result in inflation and a fall in the value of the dollar.

"The downward trend in the dollar is awesomely powerful," Mr Griffiths said. "It's vital to get yourself out of the dollar long-term on any significant rally. Continuing to own a currency that is going to be printed virtually into oblivion – that's the official policy – is crazy."

He added: "Real assets hedge paper money being printed into oblivion, so you've got to own gold and you've got to own other commodity-related investments still." on

China's first gold fund raises target $500 million

Reuters - Tuesday, January 11

SINGAPORE, Jan 11 - China's Lion Fund Management, which last month launched the first gold fund in the world's biggest producer of the metal, has met its goal of raising $500 million for the fund, the company said in a statement.

The company won regulatory approval for the fund under the country's Qualified Domestic Institutional Investor scheme, which allows Chinese money to be invested overseas. It plans to invest in gold-backed exchange-traded funds on the global market.

It was the biggest QDII fund in the last three years, thanks to investors' enthusiasm for gold, the company said.

Inflation worries and limited investment options have fuelled demand for gold from Chinese investors, especially as the precious metal staged a stellar record-breaking rally in 2010.

China, the world's biggest gold producer, is catching up with India, with demand this year expected to surpass 600 tonnes.

EMU debt crisis edges ever closer to the core

From the UK Telegraph:
By Ambrose Evans-Pritchard 10:14PM GMT 10 Jan 2011

The European Central Bank (ECB) intervened heavily in the markets, buying Greek, Irish and Portuguese bonds to drive down yields again, but has yet to broaden its emergency purchases to a fresh set of countries. Germany's Bundesbank is vehemently opposed to policy "creep" that involves the ECB in fiscal rescues by the backdoor.

The bank's refusal to be drawn further has left Belgium fending for itself as an escalating constitutional crisis pushes yields on its 10-year bonds to a post-euro record of 4.27pc. The country has not had a government since Flemish separatists emerged as the biggest party in elections seven months ago.

Stephen Jen, chief economist at Blue Gold Capital and a former IMF official, said Greece, Ireland and Portugal are already "insolvent". Refusal to face up to reality draws out agony, with a "cancerous" effect on the whole on