Greenspan's Last Bubble Has Popped: Gold ~The Fed's Managed Deflation

[link to depression2.tv]

....But suddenly it appears that the Fed is concerned about inflation. From yesterday's statement:
Inflation has been elevated, and some indicators of inflation expectations have risen. The Committee expects inflation to moderate in coming quarters, reflecting a projected leveling-out of energy and other commodity prices and an easing of pressures on resource utilization. Still, uncertainty about the inflation outlook has increased. It will be necessary to continue to monitor inflation developments carefully.
While it isn't explicitly talking about doing anything, the Fed is telegraphing its concern about too much inflation. This is one of several clues that the Fed's next task will be to tackle the inflation problem. Another clue is that the Fed didn't lower rates the full 100 basis points that the market was expecting. Third, the Fed's myriad new "lending facilities" are addressed at liquidity, and are not inflationary, as this insightful piece shows. If the Fed were to start buying banks' subprime securities outright, that would be inflationary. The banks would have a reload of free money. But this way, the lending facilities are forcing banks to keep ownership of their rotten securities, and allowing them to write them down slowly over time. This is deflationary, but the Fed is attempting to create an orderly deflation.

Why deflate? There is simply too much debt in the system. I don't believe the Fed is stupid enough to believe that it can inflate forever. The dollar is at risk, and the dollar is the source of the Fed's and America's power. If we lose that, all is lost. The Fed's most important task must shift to saving the dollar by presiding over a managed deflation, economy be damned.

And lest you think that Wall Street banks will take their new found borrowings from the Fed's new lending facilities to go out and leverage up and party on like the old days, think again. The Fed has sent a loud and clear message with Sunday's ritual sacrifice of Bear Stearns.

That's right - ritual sacrifice. The Fed could have easily saved Bear if it had just given it access to borrow at the discount window. Investment banks have that access now, but poor Bear couldn't get the cash last week. Instead the Fed let JP Morgan eat Bear for dinner, in a shocking, brutal and bloody ceremony. The Fed even picked up the tab. Like all ritual sacrifices, the choice of the victim was random. It could have been any one of the banks on Wall Street. Confidence was crumbling across the board but it just happened to be that the bank run started at Bear Stearns. The purpose of the ceremony was to scare the crap out of all those watching. It was a display of Fed power both to the world and the rest of the banks on the street. To the world it was a statement that the Fed will protect the system. To the banks, it was a stark warning from the Godfather: "Forget moral hazard. If you f*ck up, you will be left with nothing. Do you understand me? Nothing!" Enough of the funny business that got Bear into trouble - everyone has to clean up their act, lest they too end up like the poor employees of Bear Stearns.

But this is highly deflationary. It means that banks, fearing for their very existence, have to cut back on all the crazy strategies of 100:1 leverage, exotic derivatives, etc. The Fed won't bail them out. But without all that funny leverage, how can markets keep going up? Answer: They can't, and I think today the market realized that. Across the board everything was down: Commodities crater as economic worries take hand
Oil futures lost 4.5% to end at $104.48 a barrel on the New York Mercantile Exchange, its biggest daily loss since 1991. Gold for April delivery, which hit a record high of $1,034 an ounce Monday, plunged $59, or 5.9%, to finish at $945.30 an ounce, its biggest one-day drop since June of 2006. Wheat futures lost 7.7% to trade at $10.74 a bushel.
But surprise, surprise, surprise. The dollar finally had a little rally. Obviously one day does not a trend make. However, if the Fed is serious about restraining inflation, it has a very tight rope to walk. In this super leveraged world, just a tap on the inflation brake could send markets spiraling into a deflationary collapse. The Fed has got a huge challenge on its hands, managing an orderly deflation.

Market watchers take note. If deflation is beginning to spread beyond the housing market, we should start to see it reflected in the Dow soon.


[link to depression2.tv]

Wow, if gold actually does fall to the $300 range or so, I would be able to afford to buy some!

All these people saying they wished they had bought gold when it was cheaper.

They may get their chance.

Then they can save gold for their children as heirlooms.

Or just to look at and feel like a pirate with a treasure!

Guess silver would go down quite a bit as well!

Behold A Pale Horse

I. Many people are worried that the Federal Reserve has lost control of the American economy and that it will fall because it has spiraled out of control.

We offer selected segments of the book by New Age author Bill Cooper, pictured to the left, which demonstrates the virtual scientific control over the economy which government planners have increasingly exercised since World War II.

You will then understand that every downturn since then has been planned and precisely carried out!

"... it was discovered that an economy obeyed the same laws as electricity and that all of the mathematical theory and practical and computer know-how developed for the electronic field could be directly applied in the study of economics. This discovery was not openly declared and its more subtle implications were, and are, kept a closely guarded secret; for example, in an economic model, human life is measured in dollars and ... the electric spark generated when opening a switch connected to an active inductor is mathematically analogous to the initiation of a war." (P. 45, in chapter, "Silent Weapons For Silent Wars")

This callous manner of considering human life is quite consistent with other research I have done in the thinking of the Illuminati. They really hold human life in very poor esteem, about the way in which they view animals. But, I found it very interesting that they considered the spark which is necessary to carry out their plans to be "starting a war". Can you now see why America has been in almost continual war since the Second World War? Can you see why the Plan calls for continual war since the 9/11 attacks?

"Mr. Rothschild had discovered that currency gave him the power to rearrange the economic structure to his own advantage, to shift economic inductance to those economic positions which would encourage the greatest economic instability and oscillation. " (Page 43)

Keeping an economy unstable is the perfect economic application of the Masonic dictum, "Order Out of Chaos". The Global Elite begins and maintains the chaos, but they keep it under control so they can guide the nations to their desired outcome -- the global New World Order.

"The final key to economic control had to wait until there was sufficient data and high-speed computing equipment to keep close watch on the economic oscillations created by price shocking and excess paper energy credits -- paper inductance/inflatio n." (Ibid.)

After nearly 30 years after beginning to track all significant data with high-speed computers, economic controllers have achieved precise control over the economy. This next segment provides us with a clearer picture.

"The aviation field provided the greatest evolution in economic engineering by way of the mathematical theory of shock testing. In this process, a projectile is fired from an airframe on the ground and the impulse of the recoil is monitored by vibration transducers connected to the airframe and wired to chart recorders. By studying the echoes or reflections of the recoil impulse in the airframe, it is possible to discover critical vibrations in the structure of the airframe ... this means that the strengths and weaknesses of the structure of the airframe in terms of vibrational energy can be discovered and manipulated. " (Page 43-44)

Now, listen to the application of this engineering discovery to economics. You may be surprised!

"To use this method of airframe shock testing in economic engineering, the prices of commodities are shocked and the public consumer reaction is monitored. The resulting echoes of the economic shock are interpreted theoretically by computers and the psycho-economic structure of the economy is thus discovered. Then, the response of the household to future shocks can be predicted and manipulated and society becomes a well-regulated animal with its reins under the control of a sophisticated computer regulated social energy 'bookkeeping system'. " (Page 44; Emphasis added)

Now, let us read the final segment which shall give us a clear picture of the precision with which current economic planners control the economy. Notice how far back this effort goes -- to World War II.

"The Harvard Economic Research Project (1948+) was an extension of World War II Operations Research. Its purpose was to discover the science of controlling an economy: at first, the American economy, and then the world economy. It was felt that with sufficient mathematical foundation and data, it would be nearly as easy to predict and control the trend of an economy as it was to predict and control the trajectory of a projectile. Such has proven to be the case. Moreover, the economy has been transformed into a guided missile on target." (Page 44; Emphasis added).

Today, the Illuminati IS controlling the American and the global economy like a "guided missile on target". The chaos and uncertainty in world markets is deliberate and is carefully monitored so control will not be lost. The Illuminati really wants regionalization throughout the world -- from the European Union to the North American Union, etc. They want to establish regional currencies throughout the world, which is why Former Federal Reserve Chairman Alan Greenspan was in Dubai several weeks ago to attend an Arab Gulf economic meeting. Greenspan was urging all Gulf oil economic ministers to stop pegging their currency to the falling American Dollar and to replace the Dollar with their own regional currency.

This is THE current focus of this Illuminati Plan! Regional currencies.

This next segment clearly shows how NAFTA (North American Union) is proceeding on pace and seems to be headed for completion rather quickly.

DVD

II. The North American Union (NAFTA) is not only on track to be set officially in place, but the pace seems to be picking up.

NEWS BRIEF: "Inside the hush-hush North American Union talks: State Department talks open borders, EU links", By Jerome R. Corsi,
World Net Daily, March 13, 2008

"WASHINGTON -- A largely unreported meeting held at the State Department discussed integration of the U.S., Mexico and Canada in concert with a move toward a transatlantic union, linking a North American community with the European Union. The meeting was held Monday under the auspices of the Advisory Committee on International Economic Policy, or ACIEP .... No members of Congress attended the meeting."

Linking the North American Union with the European Union is a step one would expect only after the North American Union is fully established and operational. In the minds of the government and private industry officials attending this meeting, the North American Union is a "done deal". We, the people, just have not been informed yet.

At this point, we need to point out that NAFTA was voted into creation by Congress in 1993, from a concerted effort by former President George Bush (Sr.) and the current President at that time, Bill Clinton. From this beginning, the plan was to steadily move forward from the creation of an economic entity to the creation of a political nation in which the governments would be combined and all current borders would be eliminated.

Economically, NAFTA seems to be up and running far more than the average citizen realizes! In this vein, the next quote from one of the officials now makes more sense.

" 'North America is already an integrated continental economy and a continental- wide business platform', another said. 'What we need now is more regulatory convergence. 'Harmonized' should mean that once approved, the same set of administrative regulations and procedures ought to be ready throughout NAFTA, SPP and the TEC'."

This next news story tells us that at least one economist believes this region needs the AMERO now.

NEWS BRIEF: "Economist longs for creation of AMERO", By Jerome R. Corsi, World Net Daily, January 24, 2008

"Herbert Grubel – the Canadian economist who developed the concept of a North American currency comparable to the euro – laments that politics prevents the U.S. from agreeing to the creation of the amero right now ... Grubel wrote that Canada 'has a bad case of the dreaded Dutch disease, which is named after the problems that developed in the 1960s when the Netherlands sold natural gas that had been discovered on its coast'."

"The resulting increase in Dutch exports caused a strong appreciation of exchange rates which in turn caused the loss of Dutch manufacturers' ability to compete abroad with their imports. Grubel noted in Europe the problem was solved when the euro eliminated national currencies, forcing all countries to operate under interest rates set by the European Central Bank."

This scenario is exactly what I expected when the AMERO comes into reality! Since the AMERO is designed to never fluctuate in value, the resultant stability in world markets would be very attractive to most investors and to the average American citizen. Think of the demand for this new regional currency which will be generated when people are told that the price of gas at the pumps would drop by 50% once the AMERO is established!

"... Stephen Jarislowski, a billionaire money manager and investor ... further argued Canada and the United States both should abandon their national dollar currencies and move to a regional North American currency as soon as possible."

The AMERO will be created "as soon as possible", but that will not occur until the American economy is sufficiently shocked and shaken by the greatest economic turmoil possible. When the economy is seemingly headed for collapse, some politician(s) will step forward to propose that the only way in which to avert economic collapse is to officially join the economies of Canada, the United States, and Mexico and to create a fixed value regional currency known as the AMERO.

American citizens will be so frightened that they will quickly demand the conversion now!

Hang on, because the ride is going to be rough and frightening; just know that the fright is mostly illusion for the economy is not planned to tank after all. Some individuals will lose their jobs, and some companies will go out of business, but for most Americans, the economic scare will only drive them into the arms of the new regional system called NAFTA and its new fixed regional currency, the AMERO.

This prophecy seems to be coming true:

"Men's hearts failing them for fear..." Luke 21:26

But, our Lord's Word tells us: "Fear not, nor be afraid [in the coming violent upheavals..." (Isaiah 44:8; Parallel Bible, KJV/Amplified Bible Commentary)

"Fear not, there is nothing to fear, for I am with you; do not look around you in terror and be dismayed, for I am your God. I will strengthen and harden you to difficulties, yes, I will help you; yes, I will hold you up and retain you with My victorious right hand of rightness and justice." (Isaiah 41:10; Ibid.)

[link to cuttingedge.org]

"Next time someone rants and raves about mass inflation, sit tight. Be polite. Don't believe it."

This makes everything else the author says utter bullshit.

Mass inflation is already happening.

See Weimar Germany for an insight into what is to come. The exact same circumstances as then are present now. History repeating. Don't listen to Fed cocksucking shills like North. He'll be buying up gold and sold this week don't you worry!

I haven't followed Gary North since his Y2K mistaken beliefs as to what would be most likely happening, but North as a Federal Reserve shill is the exact opposite of his philosophical viewpoints. He has been wrong many times, but he has acted to his tremendous detriment upon those beliefs. He is one of a few "true believers", and is a very learned historian, as well as an Austrian economics/Mises Institute proponent. I agree with you that we certainly seem headed for hyper-inflationary collapse ala Weimer Republic Germany, however, we could very easily slip into an accidental total collapse scenario without the inflationary phase.

"...There is neither monetary inflation nor price inflation today. The CPI in February was flat: 0%."

Does he really believe that shit, or does he (like the Pretzeldip) have someone do his shopping for him, so that he has no experience with the REAL numbers.

With all these rapid-fire cash infusions, I cannot see anything BUT Inflation, esp. as the foreign holders of greenbacks are edging slowly for the exits.

The "Dollar" isn't under 'our' control, when its perceived value is subject to the Beauty Contest of how other nations see it.

I once read a great book but it was so long ago that I FORGOT THE NAME.
But anywho he argued for deflation.
The reasoning is this , the fed prints money through credit,
borrow 10$ and they give you ten dollars, and put that on the "books", creating 20$.
When the blowout occurs there wont be any loaning, inflation will be there short term, but when money becomes worthless (in a very fast amount of time) a new money will be issued , and NOBODY will have any.
Hence a deflation.
You're error trinity is that you think that there are a lot of "dollars" out there, there arent, there are a lot of high dollar amount LOANS and when they get wiped out the "fake" dollar amounts on the books they represent
will disapear.
In other words we will have a deflationary depression,
because there actually little "real" money out there

In other words we no longer have money backed by anything,
a loan is made, the money created to give the borrower,
and the "loan" is listed as an asset, and borrowed against!
And when these trillions of dollars of loans "disapear"
so will the dollar amount backing it.
Still dont think a deflation is possible?
Well, when the derivatives market (500 TRILLON) tanks that will be 500 trillon that DISAPEARS, when the 500 billion
in "govt bonds" that make up the so called social security fund go broke thats another 500 billon, and when the govt defaults on 125 TRILLON in govt debt that too will disapear.
In other words money will disapear faster than they can print new, and they wont care, they have been running up debt in dollars because they know that when they do teh Amero switch they will be able to say a dollar is worth whatever thay want (basically nothing)
The biggest theft in history, basically

Exacly...deflation is a shrinkage is the money supply. - The FED is printing up billions of new dollars every day. There is not less money going around, there is MORE.

Dropping prices of homes is an entirely different macroeconomic byproduct. It's not that they are dropping in value, it's that people are finally now realising that they were never worth what was written on the "books". Those million dollar mcmansions were never worth a million dollars. They were always worth 200k. now the market is just waking up and pricing it appropriately.

Gas, food, precious metals etc etc are all slowly going up...there's peaks and falls, but the trend is UP UP UP

you can't eat gold, better have land, fields, garden, etc...

but gold ?

better invest in goods, farms, .....

That's right to many dollars that need to be "Cashed" in so to speak, the pressure comes from all sides. Everyone is hurting so everyone, every business, is raising prices where they can. Soon Wal-Mart will be doing "Roll Up" pricing :-)

Everyone is starting to talk about this, even people that a few months ago would have never known/cared about it.

All those things are great to have, but you cannot be 100% self sufficient. Nobody can. Unless you want to live like a caveman.

I don't know about you, but I will want/need to purchase supplies for the rest of my life. Bullets, toohpaste, will have to pay property taxes, clothes, toys ..etc etc etc..

Basic survival is great, but you still need some form of currency to trade with.

jeezuz. Gary friggin North. Wrong again, poor Gary.

This guy thinks gold was a 'bubble'. this guy thinks we will have deflation? How in the wide world of sports does he come up with this gibberish? I think we can put this 'analysis' right up there with his 'analysis' of the aids crisis, Soviet bombers, and of course, y2k.

Interesting links OP. Bob Prechter wrote two books forecasting a deflation based on the quick disappearance of debt leveraged currency caused by defaults. Prechter was too early of course.

Want some REAL market advise? Get it from a REAL expert who has a proven track record and knows how the markets works!

BOB CHAPMAN
THE INTERNATIONAL FORECASTER

[link to www.theinternationalforecaster.com]

I've been wracking my brain trying to figure out what the endgame will be for dropping house prices. Not so much about the slowdown/stoppage of sales but for people that bought houses they could afford, albeit grossly overvalued. Bankers can't possibly believe that people with the means will continue to pay on seriously bad investments especially if they start handing out breaks to prevent forclosures on bad mortgages. What do y'all think?

it's all an Illusion people.

But you go ahead and believe what you want. hahahahahahahahahahahahahaha

well I guess time will tell who is right.. inflationists or deflationists or both (to a degree)

You better hope I'm right though trinity, as a hyper inflationary blow off would mean that this country is completely wiped out, and effectively ripe for takeover by foreign money.

Deflation at least protects that from happening at least to a degree.. with deflation foreigners only have the US dollars we've exported to use to buy up our country, which is still bad, but far better then having their own currency to do the same thing.

Why deflation? Because the trillions of dollars in electronic money that everybody says is being "pumped" into the system is going to evaporate, crashing the credit system, or the blood of society, along with the money supply.

Numbers on a computer screen are meaningless except to prop up an old and dying empire. When the money evaporates, all that will be left will be M2, possibly even only the M1, actual paper cash, as banks go under and it may be impossible to pull M2 money out of the system at all. This is a HYPERDEFLATIONARY IMPLOSION as electronic dollars evaporate into the nothingness in which they came, the MONEY SUPPLY DECREASES SHARPLY, the LIQUITITY TRAP will be here.. there's NO AVOIDING IT.

[link to en.wikipedia.org]



of course the only this this is going to effect on a practical basis are houses, cars, plasma TVs, salad shooters, etc. Basic essentials like loaves of bread and such won't really drop... things driven up by the sheeple's use of credit are what will crash through the toilet hard.. houses being number one.

This will be a global deflationary scenerio, not just a US dollar one, so all things propped up by leverage in any way, including commodities via futures trading, stock markets, etc. will all crash in price.

any money only has the value we as a collective puts on it. if we were to start trading in other things....

for the Bob-Meister!

to all gold bashing idiots.
You are a contrarians dream come true.

Look at any deed to property. Whose name is
on title? The name you see belongs to the State.

You cannot 'own' anything as a 'free will
adult human'. Everything you have in your
possession belongs to the State through the
State owned birth certificate name.

If you 'envelop' yourself in that name,
the name that shows the family name as being
a 'surname' (primary name), then you become
the property of the State as well. And, I'm
sure very few readers of this forum desire
that status.

So, with any asset you possess, your security
in keeping and using it is in your ability to
keep it secure from theft or reclamation by
the State.

Gold and silver are much more amenable to
securing from theft than is real estate
property. Not paying the 'land rent' -
taxes, or a claim in emminent domain can
quickly deprive you of land property.

The root word in 'assets' is 'ass', and
you have to be clever to protect you ass.

The part i liked the best was the 0% CPI!!!!

HAHAHAHAHA

Do you floks realize that both Food and Energy inflation is NOT included into that figure.

The CPI is used to manipulate the mindset of the ppl.

How ppl could see the Fed pump 1 Trillion in paper into the economy and think that this is deflation is beyond me. That is double think. This is an obvious piece of propaganda!!

They want you to think that deflation is happening so you will sell your gold and silver so the big boys can stock up for cheap before it really hits the fan.

DO NOT BE FOOLED!!!

Deflation is comming, but not before a massive amount of inflation hit. Go to the grocery store or the gas pump and see for yourself.

the artical the OP posted is more what the FED would like us to belive that they have all under control and striving to make conditions look like deflation to asume that control is still there and they are now on the other side of the curve to recovery

GREENSPAN WANTED HIS SHOW TALKS PAID IN GOLD>> REMEMBER>> HE IS NUMERO 2..THE REASON WHY THEY ARE DEFLATING IT SOME>> IS ONLY TO CONFISCATE IT:PROBABLY SO WE WONT MAKE THE HIGH ROLLERS AND WANT TO KEEP IT>> >>>AND THEN AFTERWARDS THEY WILL INFLAT IT>> THINK ABOUT IT>>

I don't know about Gary North's Y2K debacle(links?), some of his points make sense. If the big players are in a liquidity squeeze, they are scrambling for cash anywhere they can lay th hands on it. If they are holding long positions in the commodities markets, they could be closing out positions to take the profits. This would generate the cash they need. And push commodity prices down.

Seems to be some semantic confusion regarding inflation/deflation. Misians define these as a rising/falling supply of money. The government pushes rising/falling prices as inflation. Misian solutions involve stable currencies; Govt. uses wage/price controls/manipulations.

I am not sure that a slow rate of money growth , a declining dollar, and rising consumer prices are mutually exclusive.

Also note that GN does not say that money growth is negative, just that the rate of money growth is around 1%, which is historically low.

From a trading standpoint, I don't see what is wrong with taking some profits on pullbacks. He advocates unwinding in 10% chunks, starting with stocks, then bullion, and finally coin, if necessary. He also mentions the option of hedging with puts to offset losses.

WE ARE IN AN INFLATIONARY PERIOD

I define inflation as an increase in the money supply thereby diluting the value of the currency and making things more expensive.

Most all commodities increase in price with inflation. Some commodities may even greatly increase in price due to their shortages. Our world is a commodities hungry one and things are only going to get more expensive as the demand continues to increase.

One thing that is wise to remember is that we are NOT in free markets right now. The normal rules that define economics go out the window when trillions of dollars of leveraged paper gets slowly (sometimes quickly) unwound across many markets.

Todays economy depends on debt and the fast circulation of money changing hands (re velocity). This feeds speculation and inflation. Once this indicator slows stops or reverses, you have less capital investment, layoffs, wage depression, and definately price deflation. It's inevitable....

The pros & cons here are very confusing.

This means that *somebody is* going to get surprised big time.

No, I'm not going to solve the mystery for you because I don't know either. All I can see right now is that (and this is just another guess) loan default is deflationary BUT Fed buy-outs and saves are inflationary. Therefore you have a large pool of 'funny money' out there to stave off deflation for a time. But how long is "a time"? Five minutes or five years?

Again, ---->somebody is going to get surprised, and we don't know who.