As preface, consider that the USTreasury
10-year yield went below 1.4% this week. Some unenlightened celebrate the asset
appreciation and point to a successful asset in performance in an otherwise
dismal financial market. The Jackass said in the June 6th public article
"USTBonds: Black Hole Dynamics" that such a success is a marquee
billboard message of economic meltdown and systemic failure.
As the rally
continues, possibly the onliest rally outside of corn and soybeans in yet
another disaster, people should focus on whether the systemic collapse will
occur before the 10-yield hits 1.0% in my warning. Focus on four
major points:
- The unspoken
effect of ZIRP (0%) is the powerful ongoing destruction of capital, as the
entire cost structure rises
- As equipment
goes off line further, the USEconomy will weaken further, in a powerful vicious
cycle
- The official
Zero Percent Interest Policy is the calling card of the Gold Bull Market,
powered by negative inflation adjusted returns on savings
- The USTBonds will fail from their own success, unleashing the Gold Price when the investment community and global creditors realize no further potential appreciation in the most massive asset bubble in modern history, supported by Interest Rate Swap derivative machinery. Money will eventually fly out of bonds and seek true safe haven.
Fear not. The USTBond 10-year yield (TNX)
will not and cannot reach below 1.0% as all ponderings of a world with 0% on
10-year yield are divorced from reality. The Black Hole is working hard,
gathering force, amplifying the gravitational field. It is happening right on
schedule, no surprise here, a very easy correct forecast.
The original supposed
Flight to Safety in the USTBonds was totally fabricated and phony. As mentioned
at least a dozen times by the Jackass, the last half of year 2010 saw the
dutiful Wall Street outpost Morgan Stanley devote a fresh $8 trillion in
interest rate derivatives, fully documented by the Office of the Comptroller to
the Currency. Their reports never make the headlines, since they are so chock
full of rancid fetid scum.
As the TNX marches down the swirling pathways
within the vast USGovt debt sewer-like cisterns, their energy will be derived
from the massive recession that has engulfed the USEconomy. Not only is the
flight to safety in the USTBond complex a total fabrication falsehood, but the
USEconomic recovery is also a fiction written on political propaganda posters.
The followon flight to the bubble ridden USTBond is based upon economic wreckage
and broad disintegration of the entire periphery and surrounding core to the
bond market. The great sucking sound can be heard, much like during the
non-earthquake in Virginia in September 2011. Experienced traders are looking at
each other, in full recognition that the TNX rally is indeed an endgame
signal.
THE BRUSH FIRE
PHENOMENON
The LIBOR scandal unleashed brush fires.
They started in London but extend throughout the entire Western banking
treeline. The scandal that started at Barclays and Lloyds has hit Deutsche Bank,
as well as Citibank and JPMorgan. Many more pages will be written on the
LIBOR brush fire, as the damages are delineated by those on the opposite side of
the price rigging table. The USFed, Bank of England, and Euro Central Bank
are directly implicated, casting corrupt light on the central bank franchise
system.
The clownish supposed economic expert Larry Kudlow actually attempted to
claim the crime scene had no victims, as all benefit across the system. The
naive Wall Street defender (carnival barker) must not be aware of the damages
claimed by the mortgage underwriters in the lending industry, by corporations
seeking stable bond yields, and by the swap recipients in countless state
government agencies. A figure was put forth this week that caught my eye.
For
every single basis point in the LIBOR price rig, fully $50 billion in effects
result. The market is huge, involving a staggering $370 trillion in
worldwide debt. Expect hundreds of high profile lawsuits. Expect dozens of class
action lawsuits. Expect well over $1 trillion in total declared damages from the
legal attempts at remedy. LIBOR will not go away, since it is actually the heart
& soul of the entire lending industry, and of the shadowy derivative market.
LIBOR funds the vast derivative market, which is becoming frazzled in a slow
disintegration. The brush fire will burn down the USTBond Tower and render
useless its Interest Rate Swap buttress structural support, both of which are in
an implosion mode.
This article is not about LIBOR and its
inner workings, the damage suffered by mortgage underwriters, the short changing
of corporations and state agencies involved in swaps. Instead, this article
is about the serious jumps in the brush fire, jumps to new areas of scandal,
which will take down the system. In no way is the list of potential new fire
zones comprehensive. Perhaps a few more will result, since large burning tree
branches have a way of being lifted by the high winds of controversy fanned by
deep suspicion.
The entire document discovery process will be exploited to
the fullest, a vast crowbar. Once the lid is lifted via legal discovery of
LIBOR criminal collusion, all is fair game to be viewed and pulled out of the
vast sea of scum, filth, and rancid paper floating within the big bank balance
sheets. It is all admissible evidence.
Then there are the communications often
shown to be highly revealing to establish motive and paint the pictures in more
detail. No longer are those analysts like the Jackass considered biased, tilted,
and off the mark when they cite financial corruption as an ongoing theme year
after year. The corruption is coming to the surface, fully visible, in a manner
to render perhaps fatal damage to the system. My theme has been systemic failure
from the inefficiencies and corruption wrought by the Fascist Business Model.
Witness it!
My focus is on jumps in the big brush fire
that escalate the financial criminal exposures. Entirely new areas of criminal
exposure, investigation, and prosecution will emerge.
LIBOR was the center, and
Barclays was the banker's bank, which owns sizeable equity shares of numerous
global banks. Leave aside the difficult questions as to why and how the LIBOR
fraud was revealed, and why and how the crime was not shoved under the rug as
usual, and what higher power is controlling and orchestrating the maneuvers.
LIBOR and Barclays lie at the heart of the Western banking cartel and power
structure, labeled corrupt to the core. The big banker brush fire has begun.
It is raging, but it will spread to create several other nasty brush fires. The
jumps will occur easily, the process having already
begun.
MONEY LAUNDERING & NARCOTICS
DEPENDENCE
Just in the last ten days, the brush fire
jumped into the drug money laundering forest. Permit an imagery jump as well,
even though mixed imagery is a cardinal sin of composition. But since on the
topic of jumping, a shift in the blaze of imagery might be appropriate. The
money laundering of narotics funds is a vast industry.
The United Nation task
force identified the United States as being unduly reliant upon the benefits of
drug money infusion into the banking system following the 2008 Lehman bust,
sufficient to prevent a collapse. The UN document reports were published in 2009
and again in 2010. What better place to funnel the money than into the primary
banking system from the USGovt agencies responsible for the vast clearing house
functions. Representative Ron Paul has addressed this problem in direct
accusations. Here is the imagery jump.
The operations of money laundering are
like a collection of wires without insulated coatings laid out on dark basement
floors, one from each bank. The participating big banks do not always have full
knowledge of the other and their activities. Many countries are involved, as the
distribution rings are vast, like with Mexico in the recent incident. So the
wires occasionally cross each other and cause troublesome sparks. The High
Scandal in Bank Collusion has already caught fire in the money laundering rings.
The bank in the spotlight has been encouraged to align its wires properly,
according to the Cooperative Installation Alignment codes from the Underwriters
Lab south of WashingtonDC. They will comply, or else resignations will be the
least concern of the bank executives. Their lights might go out. This is a topic
loaded with risk. The message to take away is that all the major US banks are
deeply committed to narco money laundering, which tie in with defense
contractors who serve as errand boys and delivery hosts.
INTEREST RATE SWAP & FALSE USTBOND
SAFE HAVEN
The next jump in the banker brush fire might
be the revelation of the primary role played by the Interest Rate Swap
derivative contract device. The JPMorgan chief investment office is tasked with
fabricating the USTreasury Bond rally. They must maintain the near 0% bond
climate despite chronic $1.5 trillion deficts to securitize and largely absent
foreign creditors. They farm out the duty to their Morgan Stanley outpost.
Hundreds of $billions in artificial USTBond demand can be produced, with
trumpets blown by strumpets calling the flight to safety in toxic USTBonds.
Recall that the cost of funding the IRSwap mechanical abuse is the
ultra-cheap LIBOR rate. Notice the tight correlation between the US FedFunds
official rate and the LIBOR rate. The price rigging in the LIBOR came about
since the banks refused to lend at the absurd 0% rate dictated by the USFed,
working in close concert with the Bank of England. The banks were willing to
speculate at that rate, but not to lend at that rate. The target could not
be sustained. So the participants to the consensus procedure lied to each other,
complete with memos, adorned by winks. The practicality of the ZIRP could not
extend into the real world without further collusion.
They lied and gave blame to the European sovereign debt fluctuations, when they were actually stable during the focused period of six weeks. Big fluctuations were seen in the USTBond market though, identified in my past analysis. Expect further revelations and documented evidence of vast rigging process in the USTBond market, using the IRSwap devices. The flight to safety will be revealed as a sham. It is only natural in the brush fire jumps.
INSOLVENT BANK RECOGNITION & FASB
ACCOUNTING
Another jump in the banker brush fire might
be the revelation of the deep insolvency within the big US banks, managed and
kept hidden by vast accounting fraud. Recall that in April 2009, the USCongress
passed a law to bless FASB rules which allow for accounting fraud. The big banks
were permitted to declare any value they wish for all manner of toxic and rancid
assets lying within their balance sheet.
So they went on course to choose the
original book value for many imploded toxic assets like mortgage bonds, like
worthless collateralized bond obligations, and many other wonders of financial
engineering devised by the wrecking crew on Wall Street. Imagine a raft of memos
from bank executives like the chief financial officers, admitting that they are
all too aware that balance sheet items were being declared as having untrue
values, during quarterly earnings reports. The Sarbanes Oxley
violations are too numerous to count.
Imagine the stream of memos expressing
concerns over revelation that the banks were aware of the false values
disclosed. They will be more visible under document discovery amidst the LIBOR
investigations. Imagine mention with relief that the officially sanctioned FASB
accounting rules permitted the fraud, replete with fictional values set for
assets to share holders in the legal exercise. The giant banks are almost all
dead zombies, insolvent to the core.
The scandal will likely hit the
Financial Accounting Standards Board (FASB) methods and the coverup of deep
insolvency. The banks are not performing their normal lending function,
since they are insolvent, citing tighter borrower requirements. Tragically, both
the borrower is impaired and the lender is insolvent. Expect further revelations
and documented evidence of vast falsification of the accounting process in the
legally required financial reporting, using phony FASB rules. It is
only natural in the brush fire jumps.
NON-US$ TRADE SETTLEMENT & BANK
RESERVES MGMT
Another jump in the banker brush fire might
be the revelation that the big US banks are preparing for a Paradigm Shift. The
Eastern nations are well along a path to settle trade outside the USDollar. The
Chinese have arranged for bilateral currency swap agreements with a gaggle of
nations, mostly from the East, but also Brazil in the West. Consider such
agreements to be the foundation for barter systems coming into vogue. The key is
their non-US$ nature.
The entire loss of global trade settlement done in the
US$ terms is being elevated in importance. Some day soon, it might become the
majority of trade. The tipping point could come when over 50% in trade excluding
crude oil is managed outside the US$ settlement. Later, like in a year or so,
maybe a bigger tipping point could come with over 50% of all trade including
crude oil being managed ouside the US$ sphere. The big banks must see the trend,
unless they wear blinders, unless their arrogance is so thick, or unless they
are so pre-occupied with other brush fires that they leave themselves vulnerable
and unprepared.
A very important tenet of global trade and
banking is that trade dictates banking activity, not the other way around. It
used to be for decades that the USDollar global standard required all trade to
be settled in its reserve currency. The banking structures must reflect the
reality of trade settlement methods and practices. However, the mortgage
bond crisis laden with banking fraud in mortgages and foreclosures rendered
damage. The TARP Fund patch job with bait & switch in executive largesse
rendered damage.
The USFed bond monetization (called euphemistically
Quantitative Easing) went out of control, causing a global rise in energy and
food prices. The result was great damage rendered. The endless foreign wars on a
credit card have caused deep resentment, replete with fraud among the service
contractors, also rendered damage. The Iran sanctions, further distracting from
the basic violation of Iranian oil sales outside the US$ sphere, have resulted
in tremendous insurrection against the global reserve currency.
The major Paradigm Shift in trade has been
the emergence of non-US$ trade settlement and the development of devices to
facilitate the skirting end around process. Therefore, the banking system must
adapt or be left isolated. The big US banks might soon be caught in revelations
that they are preparing for shunning of the USDollar in trade payments and
satisfaction.
They might reveal processes already in place to dump USTreasury
Bonds at their artificially lofty values, maintained by high powered Interest
Rate Swap machinery during a falsely engineering flight to safety. Imagine open
communications about demanded IRSwap usage to maintion artificially rigged high
bond principal values. They will be more visible under document discovery amidst
the LIBOR investigations.
If the big US banks are shown to be diversifying out
of USTBonds during the current crisis, it would indeed be devastating news
against the Dollar Fortress. Expect further revelations and documented evidence
of diversification away from the bubblicious overvalued USTBonds, as the trade
settlement pathways avoid the US bull chits. It is only natural in
the brush fire jumps.
ALLOCATED GOLD & 40 THOUSAND METRIC
TONS SHORT
An assured jump in the banker brush fire
will be the revelation of massive raids on Allocated Gold accounts done
systematically over two decades. The big Western banks have been illegally
grabbing the gold bars via unauthorized leasing, then selling them in the open
market in order to maintain the artificially low Gold & Silver prices. The
process of revelation is already well along, with important major lawsuits in
Switzerland. The Matterhorn case where Von Greyerz pointed out the long delays
for his fund investors to receive their gold bars from Allocated accounts has
added to the controversy.
The gold bars arrived with stamps and dates much
younger than the original bars owned, lifting the veil of fraud. The scandal has
not yet reached the public eye, but it will very soon. Some Gold experts call it
The Mother of All Gold Scandals. Several class action lawsuits totaling several
$billion are underway in the elite banker nation of Switzerland. So far, the
coopted press has kept a lid on the story. The leaks will be natural, like an
overflow of chocolate from the vat. The documents concerning the serious illegal
activity will be more visible amidst document discovery during the LIBOR
investigations.
My best source shared in 2010 that at least
20 thousand tons of Gold had improperly been taken, leased, and replaced with
gold paper certificates in vaulted locations. The bullion bankers were
dangerously short. In 2011, he admitted that the criminal activity had easily
surpassed 40 thousand tons of Gold illegally leased, resulting in a massive
short position for the bullion banks. In 2012, he increased his estimate to
between 40 and 60 thousand metric tons of gold illegally seized from Allocated
Gold accounts, the short position totally out of control and absolutely
impossible to bring into balance with short covering.
In the last week, he
passed along a communication with a veteran Gold expert with decades of savvy
experience. They concluded that remedy for the vast gigantic short position
by the gold bullion bankers will send the Gold price well over $10,000 per
ounce. They believe probably by the end of the criminal prosecution remedy,
the resolution of the defrauded Allocated gold accounts, and the installation of
the new trade system alternative, the Gold price will find a natural value at
least twice that elevated value. Expect further revelations and documented
evidence of vast Allocated Gold account raids, and improper raids to gut the
Exchange Traded Funds (GLD, SLV). It is only natural in the brush
fire jumps.
The Gold Bull will hit on all eight
cylinders, and adopt another four cylinders, when the Allocated Gold account
fraud is revealed and hits the news. Only then will public calls for broad
criminal prosecution be accompanied by equal calls by the very wealthy. By then,
speculation will extend to how high the Gold price can go, and to what limit.
Think at that point, unlimited extensive money growth, a gaggle of futile bank
aid packages, and currency debasement abuse from the hyper monetary inflation
underway for over four years.
The Gold price must match the abuse stride for
stride, when at the same time react to forced bullion banker purchases of Gold
in order to replace the raided Allocated accounts. A frenzy
will come.
2011 BANK HEIST & DISPOSITION OF
ASSETS
A potential disruptive jump in the banker
brush fire would be the revelation of disposition of World Trade Center vaulted
assets. Only a moron would believe they vanished. Refer to the enormous amount
of purported missing gold bullion, the enormous amount of purported missing
bearer bonds, the enormous amount of purported missing diamonds from the
infamous 911 event. The political implications would be vast, far more damning
than the smoking guns by scientists. They would eclipse any and all claims made
by engineers and architects (see AE1000 Group) that undermine the official
poppycock story.
The documents concerning the flow of gold, bonds, and diamonds
might be more visible under document discovery amidst the LIBOR investigations,
if a bank heist were to be demonstrated. It is a difficult task to conceal the
movement of $100 billion in gold bars, $100 billion in bearer bonds, and $100
billion in diamonds, if indeed it was a bank heist. The Jackass scientific
background has consistently brought attention to the vast inconsistencies due to
gravitation pull in freefall, to the inadequate burning temperature of jet fuel
to alter structural steel, and the absence of aircraft debris on the Pentagon
lawn. All official stories have seemed like music on the other side of logic and
physics.
Only flag waving morons sporting red white
and blue jockey shorts believe the official story, in addition to diehard types
who hold scientific evidence in contempt, along with senile veterans well past
the octagenarian mark. No disrespect is meant to veterans, who often seem
incapable of sorting evidence or even identifying a financial fascist out of
uniform. Even the 911 Commissioners admit they were coerced to omit widespread
evidence, including testimony from the New York Police Dept captains.
They could
not voice their objection too loudly, or else lose their jobs and likely
pensions too. Whereas in 2003 and 2004 the critics seemed like crackpots, no
longer do they seem so wild-eyed and lunatic. Some very well informed people
believe the 911 event was actually a bank heist. The odd new twist is the
reports that many people at the World Trade Center who were eyewitnesses have
died mysterious deaths. Harken back to the Grassy Knoll from that infamous
November 1963 event in Dallas. By the 1990 decade, a few dozen people had died
from mysterious deaths, many being violent deaths, to the point that no
eyewitnesses had survived. A mission accomplished in the sordid history of the
United States.
The bond trails already cast extremely suspicious light on Cantor
Fitzgerald, which curiously moved all its data storage backup facilities to New
Jersey only a few months before the incident. Perhaps further potential
revelations and documented evidence toward disposition of WTC site assets will
surface during the never ending discovery process. It is only natural in the
brush fire jumps. One can only wonder what George Washington, Thomas Jefferson,
John Adams, and Benjamin Franklin would have to say about these events, or even
Dwight Eisenhower and Douglas MacArthur. The notion of patriotism has been
redefined by force. Many patriots prefer to think and use the brain stem,
turning away from the goose step. Then again, perhaps several hundred
discrepancies, inconsistencies, and contradictions to the official story are
just a coincidence and the work of our enemies.
MUTUALLY ASSURED
DESTRUCTION
A very unusual phenomenon is at work. The
three banker camps from the United States, London, and Western Europe are
naturally going to protect their own pillboxes. A well connected banker source
from Central Europe has shared that Deutsche Bank has already begun to cooperate
with the International Court of Hague, working with Interpol officers, bank
examiners, experienced attorneys, and judges to assist the prosecution of London
and New York bankers.
But Deutsche Bank cannot stop the assault by USGovt
officials and their army of legal prosecutors, who will tear D-Bank apart. The
London bankers have been exposed, laid bare, for the entire world to attack
them. The resignations will continue like a parade, soon to involve the
privileged groups among the Anglo elite. Expect far more lawsuit effects than
prosecutions, since the USGovt legal staff is loaded to the gills with Wall
Street friendlies.
The CFTC and SEC and FDIC and FBI have to
date been attack dogs and protectors to the Syndicate in the entire scandalous
decade. They are the Fascist Business Model soldiers in the field. To be sure,
each of the three camps will attack in round after round, bringing charges,
seeking remedy, forcing executive sacks, levying fines, and more.
They will each
enable high ranking bank executives to turn state's evidence, to flip, but the
lines of jurisdiction cannot be altered. Each region will protect its own, and
attack the other two. A fight to the death might have begun. The banker
attacks will not put each other's executives in jail, as much as wreck the
Western banking structures. Witness the Competing Currency War in a late
stage, as it has reached a new level of financial violence. The Wall Street
marketing corps, and the noble financial press, have chosen to trumpet the
message that European weakness translates to American advantage.
It is like Al
Capone competing with Bugsy Moran. It is like John Gotti pointing a finger at
Michael Corleone. In the end, they will both succumb to the pressures and the
light. Their ships at sea are listing and taking on water. They will all sink.
The life boats are made of Gold with Silver linings
GOLD IS THE TRUE
SANCTUARY
The concept of solutions for the global
monetary system, the global currency system, and the global banking system, have
become outright laughable and an insult to the intelligence of observers. The
paper system has become weighed down by toxic assets to the point of rendering
the entire system insolvent and sinking its future prospects. No new debt can
repair and provide remedy for the fatally sick and current overly indebted dying
system.
The new trade settlement facilities are ready to put in place, based
upon a Gold & Silver core. That word has come from a source directly
involved in the preparation process for the Eastern Fortress. The trade notes
will provide the lubrication to complete trade, which will have a hard asset
core. The USDollar will gradually fade away from trade settlement, except for
the United States, Canada, the United Kingdom, and possibly Southern Europe. The
great tipping point approaches, whereby over half of global trade will be
settled outside the domain of the crippled toxic USDollar. The foreign
participants can no longer tolerate the bank bond fraud, the central bank
debasement, and the usage of bank devices as weapons.
Major changes are coming. A return to a
certain type of Gold Standard is right around the corner, awaiting the Western
collapse that is in a late stage of pathogenesis. The jumping brush fires
that the London, New York, and Western European bankers must contend with will
eventually envelop them, doling out massive smoke inhalation. Worst of all, the
jumps will expose new areas of corruption every few weeks, sufficient to bring
down the system. After all, it is a fiat faith based system. The faith has long
ago vanished.
All that remains is power politics, arrogance, and corruption. The
new system will force the Gold price above $5000 per ounce on a conservative
basis. It is all part of the plan not yet revealed. The Gold/Silver Ratio will
revert to 20:1 in time. That translates for the math impaired to a $250 per
ounce Silver price. These are conservative figures.
