By: Bob Chapman, The International Forecaster
-- Posted Sunday, 16 November 2008
-- Posted Sunday, 16 November 2008
The following are some snippets from the most recent issue of the International Forecaster. For the full 33 page issue, please see subscription information below.
US MARKETS
The Illuminati are double-dipping. Every time Congress raises the debt ceiling and issues new treasuries that are then sold to the Fed, at interest, in order to fund the various bailouts which taxpayers are having stuffed down their throats, another shadow bailout occurs that no one has taken note of. What are we talking about? We'll tell you what we are talking about. For instance, when the $700 billion Paulson Ponzi Plunder Plan was passed by Congressional traitors over their constituents' objection, another potential stealth bailout of elitist financial institutions was also under way for an additional 700 billion, making the Paulson Ponzi Plunder Plan a potentially cool $1.4 trillion dollar injection of extorted taxpayer largesse to elitist financial institutions. Have we lost our minds? No, we just notice things that no one else picks up on, which is why we have so many subscribers.
Whenever new treasuries are created to fund bailouts authorized by Congress, which must keep raising the national debt ceiling to accommodate such new issues, the Fed can buy them (a process which is called the monetization of treasury bonds), and charges the US government interest on these "loans" when it does, by adding digital money to the Treasury's account with the Fed, which the Treasury can then use to fund the various bailouts, such as the equity injections being given to elitist banks, some $125 billion to the Big Nine just for starters. The Fed can then include the treasuries so purchased as part of its general collateral, which it can then, in turn, use to conduct its various programs, which includes the Term Securities Lending Facility (TSLF). Thus, ergo, it can exchange those treasuries for toxic waste held by other elitist institutions pursuant to the TSLF, thereby debauching its own balance sheets with assets that are worth 10 to 30 cents on the dollar, but which the Fed lists at par value on its balance sheets.
Well yes, but those treasuries are borrowed and have to be returned at some point in exchange for taking the toxic waste back. WRONG! Those treasuries that have been received by banks in exchange for toxic waste can be used as collateral for loans or sold to raise cash. These loans of treasuries are being conducted just like gold and silver leasing by bullion banks. The items being borrowed or leased are being sold or pledged as collateral, and are never coming back. When the insolvent elitist banks that borrowed these treasuries go under, which most of them eventually will when the Derivative Death-Star finally and fully detonates, the treasuries that these insolvent institutions borrowed from the Fed in exchange for toxic waste will have to be liquidated in bankruptcy to pay off loans for which they were pledged as collateral or to pay off other debts of the bankrupt entity. Those treasuries, which were sold for cash will remain with their new owners. The Fed does not intend to ever get these treasuries back. The Fed will eventually be left holding a heap of toxic waste collateral, worth 10 to 30 cents on the dollar, and will be essentially bankrupt and in need of a bailout itself. If any private business entity could be deemed too-big-to-fail by our corrupt government, it would be the Fed itself, because it is your money they are loaning out in exchange for nearly worthless collateral. The Fed is now the central clearing house for toxic waste. It has become the Toxic Waste Storage Facility (TWSF), to coin a phrase.
If you include new treasuries added to the Fed's balance sheet along with the toxic waste collateral which the Fed has received for loans made under its lending authority through Buck-Busting Ben's various helicopter loan facilities, the Fed has added over $1.2 trillion worth of collateral to its balance sheets over the past several months, raising the amount it holds as general collateral from about $800 billion to over $2 trillion, which additions to its general collateral are essentially a Weimar-like, hyperinflationary increase to the supply of money denominated in US dollars. So a large and growing portion of treasury bonds monetized by the Fed are being loaned in exchange for toxic waste under the TSLF, to the tune of hundreds of billions thus far, while loans made under the Fed's lending authority are being collateralized with toxic waste as well. Hence, the Bloomberg lawsuit was commenced to find out who got the loans of treasuries and cash and what collateral was received in exchange. The Fed not only does not want you to know who is in danger of going under, they do not want you to know about the stealth bailouts we just mentioned, or about the pathetic collateral they are collecting in exchange for loans made pursuant to their lending authority. Now you know why the Fed is so reticent.
This also explains why the Paulson Ponzi Plunder Plan has done a deceptive about face on how the bailout proceeds will be used. First, the proposed toxic waste purchases were a red herring. The Illuminati never intended to use the proceeds to acquire toxic waste because they were already acquiring a lot of the toxic waste held by Illuminist banks and financial institutions through the Term Securities Lending Facility and other cash loan facilities being offered through the Fed, and would be able to continue to do so through the stealth bailouts we have just described. The Fed's toxic waste acquisitions avoid the valuation problems which would arise by via the government's purchase of toxic waste through special auctions because the toxic waste is not being sold, but rather, is being pledged as collateral. Also, the equity injections prevent the necessity of de-leveraging. Large commercial banks are leveraged at about 10 to 1, and for each billion that is injected, $10 billion in forced asset sales through de-leveraging is prevented. They did not, however, want to sell the Paulson Ponzi Plunder Plan to Congress in terms of equity injections, because the partial government ownership that resulted would look too much like communism, socialism or corporatist fascism, take your pick. So they disguised the plan as being some form of mere government financial handouts that were promoted as fully (or at least partially) collateralized loans to get banks to start lending to consumers again, instead of stating what the PPPP really was intended to be from the beginning, namely, the start of a complete government takeover of the financial and other business sectors, commencing with a partial nationalization of the financial industry, with the end game being to completely nationalize the financial industry along with many other sectors of our economy, like the auto and insurance industries.
And think of the implications for the dollar. The Fed's general collateral is supposed to secure the value of the dollar since we have been taken off the gold standard and our gold reserves have all been stolen, leased or otherwise hypothecated in any case. Let's be charitable and say that the toxic waste collateral is worth 30 cents on the dollar. That would mean that the Fed's general collateral, thus far, would be worth about 600 billion when fully debased by toxic waste. That is not even enough to cover the 700 to 800 billion of physical cash in the form of printed Federal Reserve notes in circulation. And never mind the additional $10 trillion of current debt, which the US government owes. And certainly never mind the additional $90 trillion on top of that which the US government owes on long term debt in the form of future entitlements and other such promises to pay that our morons in Congress have committed us to. That means that the US of A has become a mammoth hedge fund leveraged at almost 200 to 1. Is it any wonder that foreign holders of US treasury and agency paper are starting to get a little concerned? You have personally witnessed what has happened to many highly leveraged hedge funds and investment banks of late. In short, they were vaporized, and that is what is about to happen to our financial system as well. It is only a matter of time as you watch the US dollar do what Jim Willie appropriately described as the "US Dollar Death Dance." Gold and silver will rocket into outer space when the Dollar Death Dance reaches its climactic conclusion.
Due to the detonation of the Derivative Death-Star, the too-big-to-fail Fed, together with other major too-big-to-fail banks that are being created by mergers funded by taxpayer largesse right before our very eyes, will be merged into one egregious, corporatist, fascist super-entity, which will be given full regulatory power over all financial entities in the US, and which will rule our financial markets with an iron fist. If and when that happens, just bend over and kiss your derriere goodbye. The Illuminati will do whatever they please at that point and nothing short of a revolution will stop them.
We note in passing that American Express has joined Goldman Sachs and Morgan Stanley in becoming a bank holding company so they can take advantage of Fed bailout largesse. CIT Group has now also applied for the same privileges. Who will be next, we wonder? We also note how the fane-stream media made a big deal out of the $29 billion quarterly loss by Fannie. That is $29 billion, with two trillion, $471 billion to go. These losses are laughable. It is a joke. We further note that while bank loan rates are going down, consumer loan rates are going up. This is how they increase spreads and rip off the public. The same is being done with gold and silver, where the public is forced to pay black market prices while the elitist commercial bullion banks get to pay wholesale prices that are 40 to 50% lower based on illegal paper manipulations. They get the gold mine, you get the shaft. That is the Illuminist plan in a nutshell.
We hope all of you are out of the general stock market with the exception of gold, silver, oil and gas stocks, and our selective short positions that have done so phenomenally well. Everywhere investors are bemoaning their losses as the market hits new lows predicted here in this publication. This is the worst drop since 1937, a fall from 14,100 to close to 8,000. Worse yet, the bottom is nowhere in sight. We see somewhere between 3,800 to 5,500 as a bottom, unless we see revolution in the streets of America or WWIII. Then the bottom will be lower.
In addition, central banks may be lowering interest rates, but rates in the real market are relatively unchanged or higher. In the securitized subprime and ALT-A securities sellers, when they can occasionally find a buyer, are getting $0.10 to $0.25 on the dollar for their bonds. Even quality AAA paper ranges from $0.25 to $0.65 with a few buyers in sight. Now ABS, asset backed securities, holding loans on credit cards, vehicles, mobile homes, swimming pools, etc., cannot find buyers. The market is almost frozen. Bonds from second and third world countries have fallen like stones. There are more than $42 trillion in losses still to be taken.
Bonds are still being carried at mark to model not mark to market, which is a fiction aided and abetted by the SEC. Those losses will be taken sooner or later. Either that or the taxpayer will pick up the bill. Either way, it is not going to be pleasant.
Those scurrying to the perceived safety of US Treasury paper are in for a big surprise. As we write the 10-year Treasury note yields 3.70%. Inflation has temporarily fallen from 13-5/8% to 12-1/2% leaving a net loss of some 8-3/4%, hardly a safe investment. This perceived safe paper has long and short-term obligations of over $100 trillion. This coming year the debt rating on Treasuries and Agencies will fall and further losses will ensue.
This coming year every institution will be trying to raise capital. In the coming fiscal year government will need to raise a fresh $2 trillion and we ask where will it come from? At best government will crowd commercial borrowers out of the market and drive interest rates higher. It will be a very competitive and difficult marketplace.
Our Treasury Secretary wants to expand the TARP program to help the consumer finance sector. That includes private-equity funds.
After five weeks TARP only has $60 billion left out of the $350 billion initial funding. Now it’s back to Congress for $350 billion more. Crony capitalism – better known as corporatist fascism – marches on. The looting continues with wild abandon before the S.S. America goes under. Wait until US Treasury and Agency losses their AAA ratings. The Ponzi scheme gets a little more unwound.
Professionals, never mind the public, have no concept of how buried in bad debt and derivatives banks, Wall Street and corporate America are. Overall debt is 40 times assets.
The public doesn’t understand that AIG took client premiums and used them as collateral to become derivatives dealers. GM and GE did the same thing and we are bailing them all out. GE would have gone under last month if Warren Buffett hadn’t come to the rescue. AIG is being bailed out by you the American taxpayer as is GE and GM.
These are the same characters, along with the Fed, BIS, IMF, the Counterparty Risk Management Group, the US Treasury’s Exchange Stabilization und and the President’s Working Group on Financial Markets, which are manipulating world markets. There have been no free markets for years.
The NAR pending home sales index fell 4.6% in September. In the West sales rose 3.7%. They fell 0.7% in the Midwest, 7.9% in the South and 16.8% in the Northeast.
Foreclosures accounted for 18.6% of all sales nationwide last year.
December will be a brutal month for layoffs, as the economy worsens and more companies look for ways to cut costs. This is when executives scramble to hit profit targets and prepare budgets for 2009. Not only corporations will be cutting, but so will cities, towns, counties, municipalities and states. These cutbacks are already underway. State by state job cuts will vary from 2,000 to more than 100,000 in December alone. Wait until January when these unemployment figures are released. They’ll be shocking. Nationally unemployment officially has been rising at the fastest pace in 26 years. Construction, manufacturing and financials have been hit hardest. Next will be the white-collar world.
US MARKETS
The Illuminati are double-dipping. Every time Congress raises the debt ceiling and issues new treasuries that are then sold to the Fed, at interest, in order to fund the various bailouts which taxpayers are having stuffed down their throats, another shadow bailout occurs that no one has taken note of. What are we talking about? We'll tell you what we are talking about. For instance, when the $700 billion Paulson Ponzi Plunder Plan was passed by Congressional traitors over their constituents' objection, another potential stealth bailout of elitist financial institutions was also under way for an additional 700 billion, making the Paulson Ponzi Plunder Plan a potentially cool $1.4 trillion dollar injection of extorted taxpayer largesse to elitist financial institutions. Have we lost our minds? No, we just notice things that no one else picks up on, which is why we have so many subscribers.
Whenever new treasuries are created to fund bailouts authorized by Congress, which must keep raising the national debt ceiling to accommodate such new issues, the Fed can buy them (a process which is called the monetization of treasury bonds), and charges the US government interest on these "loans" when it does, by adding digital money to the Treasury's account with the Fed, which the Treasury can then use to fund the various bailouts, such as the equity injections being given to elitist banks, some $125 billion to the Big Nine just for starters. The Fed can then include the treasuries so purchased as part of its general collateral, which it can then, in turn, use to conduct its various programs, which includes the Term Securities Lending Facility (TSLF). Thus, ergo, it can exchange those treasuries for toxic waste held by other elitist institutions pursuant to the TSLF, thereby debauching its own balance sheets with assets that are worth 10 to 30 cents on the dollar, but which the Fed lists at par value on its balance sheets.
Well yes, but those treasuries are borrowed and have to be returned at some point in exchange for taking the toxic waste back. WRONG! Those treasuries that have been received by banks in exchange for toxic waste can be used as collateral for loans or sold to raise cash. These loans of treasuries are being conducted just like gold and silver leasing by bullion banks. The items being borrowed or leased are being sold or pledged as collateral, and are never coming back. When the insolvent elitist banks that borrowed these treasuries go under, which most of them eventually will when the Derivative Death-Star finally and fully detonates, the treasuries that these insolvent institutions borrowed from the Fed in exchange for toxic waste will have to be liquidated in bankruptcy to pay off loans for which they were pledged as collateral or to pay off other debts of the bankrupt entity. Those treasuries, which were sold for cash will remain with their new owners. The Fed does not intend to ever get these treasuries back. The Fed will eventually be left holding a heap of toxic waste collateral, worth 10 to 30 cents on the dollar, and will be essentially bankrupt and in need of a bailout itself. If any private business entity could be deemed too-big-to-fail by our corrupt government, it would be the Fed itself, because it is your money they are loaning out in exchange for nearly worthless collateral. The Fed is now the central clearing house for toxic waste. It has become the Toxic Waste Storage Facility (TWSF), to coin a phrase.
If you include new treasuries added to the Fed's balance sheet along with the toxic waste collateral which the Fed has received for loans made under its lending authority through Buck-Busting Ben's various helicopter loan facilities, the Fed has added over $1.2 trillion worth of collateral to its balance sheets over the past several months, raising the amount it holds as general collateral from about $800 billion to over $2 trillion, which additions to its general collateral are essentially a Weimar-like, hyperinflationary increase to the supply of money denominated in US dollars. So a large and growing portion of treasury bonds monetized by the Fed are being loaned in exchange for toxic waste under the TSLF, to the tune of hundreds of billions thus far, while loans made under the Fed's lending authority are being collateralized with toxic waste as well. Hence, the Bloomberg lawsuit was commenced to find out who got the loans of treasuries and cash and what collateral was received in exchange. The Fed not only does not want you to know who is in danger of going under, they do not want you to know about the stealth bailouts we just mentioned, or about the pathetic collateral they are collecting in exchange for loans made pursuant to their lending authority. Now you know why the Fed is so reticent.
This also explains why the Paulson Ponzi Plunder Plan has done a deceptive about face on how the bailout proceeds will be used. First, the proposed toxic waste purchases were a red herring. The Illuminati never intended to use the proceeds to acquire toxic waste because they were already acquiring a lot of the toxic waste held by Illuminist banks and financial institutions through the Term Securities Lending Facility and other cash loan facilities being offered through the Fed, and would be able to continue to do so through the stealth bailouts we have just described. The Fed's toxic waste acquisitions avoid the valuation problems which would arise by via the government's purchase of toxic waste through special auctions because the toxic waste is not being sold, but rather, is being pledged as collateral. Also, the equity injections prevent the necessity of de-leveraging. Large commercial banks are leveraged at about 10 to 1, and for each billion that is injected, $10 billion in forced asset sales through de-leveraging is prevented. They did not, however, want to sell the Paulson Ponzi Plunder Plan to Congress in terms of equity injections, because the partial government ownership that resulted would look too much like communism, socialism or corporatist fascism, take your pick. So they disguised the plan as being some form of mere government financial handouts that were promoted as fully (or at least partially) collateralized loans to get banks to start lending to consumers again, instead of stating what the PPPP really was intended to be from the beginning, namely, the start of a complete government takeover of the financial and other business sectors, commencing with a partial nationalization of the financial industry, with the end game being to completely nationalize the financial industry along with many other sectors of our economy, like the auto and insurance industries.
And think of the implications for the dollar. The Fed's general collateral is supposed to secure the value of the dollar since we have been taken off the gold standard and our gold reserves have all been stolen, leased or otherwise hypothecated in any case. Let's be charitable and say that the toxic waste collateral is worth 30 cents on the dollar. That would mean that the Fed's general collateral, thus far, would be worth about 600 billion when fully debased by toxic waste. That is not even enough to cover the 700 to 800 billion of physical cash in the form of printed Federal Reserve notes in circulation. And never mind the additional $10 trillion of current debt, which the US government owes. And certainly never mind the additional $90 trillion on top of that which the US government owes on long term debt in the form of future entitlements and other such promises to pay that our morons in Congress have committed us to. That means that the US of A has become a mammoth hedge fund leveraged at almost 200 to 1. Is it any wonder that foreign holders of US treasury and agency paper are starting to get a little concerned? You have personally witnessed what has happened to many highly leveraged hedge funds and investment banks of late. In short, they were vaporized, and that is what is about to happen to our financial system as well. It is only a matter of time as you watch the US dollar do what Jim Willie appropriately described as the "US Dollar Death Dance." Gold and silver will rocket into outer space when the Dollar Death Dance reaches its climactic conclusion.
Due to the detonation of the Derivative Death-Star, the too-big-to-fail Fed, together with other major too-big-to-fail banks that are being created by mergers funded by taxpayer largesse right before our very eyes, will be merged into one egregious, corporatist, fascist super-entity, which will be given full regulatory power over all financial entities in the US, and which will rule our financial markets with an iron fist. If and when that happens, just bend over and kiss your derriere goodbye. The Illuminati will do whatever they please at that point and nothing short of a revolution will stop them.
We note in passing that American Express has joined Goldman Sachs and Morgan Stanley in becoming a bank holding company so they can take advantage of Fed bailout largesse. CIT Group has now also applied for the same privileges. Who will be next, we wonder? We also note how the fane-stream media made a big deal out of the $29 billion quarterly loss by Fannie. That is $29 billion, with two trillion, $471 billion to go. These losses are laughable. It is a joke. We further note that while bank loan rates are going down, consumer loan rates are going up. This is how they increase spreads and rip off the public. The same is being done with gold and silver, where the public is forced to pay black market prices while the elitist commercial bullion banks get to pay wholesale prices that are 40 to 50% lower based on illegal paper manipulations. They get the gold mine, you get the shaft. That is the Illuminist plan in a nutshell.
We hope all of you are out of the general stock market with the exception of gold, silver, oil and gas stocks, and our selective short positions that have done so phenomenally well. Everywhere investors are bemoaning their losses as the market hits new lows predicted here in this publication. This is the worst drop since 1937, a fall from 14,100 to close to 8,000. Worse yet, the bottom is nowhere in sight. We see somewhere between 3,800 to 5,500 as a bottom, unless we see revolution in the streets of America or WWIII. Then the bottom will be lower.
In addition, central banks may be lowering interest rates, but rates in the real market are relatively unchanged or higher. In the securitized subprime and ALT-A securities sellers, when they can occasionally find a buyer, are getting $0.10 to $0.25 on the dollar for their bonds. Even quality AAA paper ranges from $0.25 to $0.65 with a few buyers in sight. Now ABS, asset backed securities, holding loans on credit cards, vehicles, mobile homes, swimming pools, etc., cannot find buyers. The market is almost frozen. Bonds from second and third world countries have fallen like stones. There are more than $42 trillion in losses still to be taken.
Bonds are still being carried at mark to model not mark to market, which is a fiction aided and abetted by the SEC. Those losses will be taken sooner or later. Either that or the taxpayer will pick up the bill. Either way, it is not going to be pleasant.
Those scurrying to the perceived safety of US Treasury paper are in for a big surprise. As we write the 10-year Treasury note yields 3.70%. Inflation has temporarily fallen from 13-5/8% to 12-1/2% leaving a net loss of some 8-3/4%, hardly a safe investment. This perceived safe paper has long and short-term obligations of over $100 trillion. This coming year the debt rating on Treasuries and Agencies will fall and further losses will ensue.
This coming year every institution will be trying to raise capital. In the coming fiscal year government will need to raise a fresh $2 trillion and we ask where will it come from? At best government will crowd commercial borrowers out of the market and drive interest rates higher. It will be a very competitive and difficult marketplace.
Our Treasury Secretary wants to expand the TARP program to help the consumer finance sector. That includes private-equity funds.
After five weeks TARP only has $60 billion left out of the $350 billion initial funding. Now it’s back to Congress for $350 billion more. Crony capitalism – better known as corporatist fascism – marches on. The looting continues with wild abandon before the S.S. America goes under. Wait until US Treasury and Agency losses their AAA ratings. The Ponzi scheme gets a little more unwound.
Professionals, never mind the public, have no concept of how buried in bad debt and derivatives banks, Wall Street and corporate America are. Overall debt is 40 times assets.
The public doesn’t understand that AIG took client premiums and used them as collateral to become derivatives dealers. GM and GE did the same thing and we are bailing them all out. GE would have gone under last month if Warren Buffett hadn’t come to the rescue. AIG is being bailed out by you the American taxpayer as is GE and GM.
These are the same characters, along with the Fed, BIS, IMF, the Counterparty Risk Management Group, the US Treasury’s Exchange Stabilization und and the President’s Working Group on Financial Markets, which are manipulating world markets. There have been no free markets for years.
The NAR pending home sales index fell 4.6% in September. In the West sales rose 3.7%. They fell 0.7% in the Midwest, 7.9% in the South and 16.8% in the Northeast.
Foreclosures accounted for 18.6% of all sales nationwide last year.
December will be a brutal month for layoffs, as the economy worsens and more companies look for ways to cut costs. This is when executives scramble to hit profit targets and prepare budgets for 2009. Not only corporations will be cutting, but so will cities, towns, counties, municipalities and states. These cutbacks are already underway. State by state job cuts will vary from 2,000 to more than 100,000 in December alone. Wait until January when these unemployment figures are released. They’ll be shocking. Nationally unemployment officially has been rising at the fastest pace in 26 years. Construction, manufacturing and financials have been hit hardest. Next will be the white-collar world.