Lets Take A Moment To Dissect Bernake's Latest Zero Interest Rate Policy

by: Bruce Krasting / ZeroHedge.com

I had this to say last week:

The Fed could easily attempt to buy some market peace by issuing a statement that the policy of zero interest rates would be extended for a minimum period of one year. I consider this to be a “high probability" to happen in the next 30 days.

I got it right, but I got it completely wrong. I feared that the Fed could extend the ZIRP language for as long as a year. Not in my wildest dream did I think they could take the extremely risky move of guaranteeing that interest rates will remain at zero for another 24 months.

Having been shocked, my thoughts.

A 634 Point Stock Market Crash And 8 More Reasons Why You Should Be Deeply Concerned That The U.S. Government Has Lost Its AAA Credit Rating

article from: theeconomiccollapseblog.com


Are you ready for part two of the global financial collapse?  Many now fear that we may be on the verge of a repeat of 2008 after the events of the last several days.  On Friday, Standard & Poor's stripped the U.S. government of its AAA credit rating for the first time in history.  World financial markets had been anticipating a potential downgrade, but that still didn't stop panic from ensuing as this week began.  On Monday, the Dow Jones Industrial Average dropped 634.76 points, which represented a 5.5 percent plunge.  It was the largest one day point decline and the largest one day percentage decline since December 1, 2008.  Overall, stocks have fallen by about 15 percent over the past two weeks.  When Standard & Poor's downgraded long-term U.S. government debt from AAA to AA+, it was just one more indication that faith in the U.S. financial system is faltering.  Previously, U.S. government debt had a AAA rating from S&P continuously since 1941, but now that streak is over.   Nobody is quite sure what comes next.  We truly are in unprecedented territory.  But one thing is for sure - there is a lot of fear in the air right now.

Russia Joins China In Rejecting U.S. Debt, Buys Gold Instead

China, the largest foreign holder of U.S. debt, has been concerned about the safety of its U.S. treasury debt holdings for years.

In March 2009, Chinese Premier Wen Jinbao warned Washington that "We have lent a huge amount of money to the U.S.  Of course we are concerned about the safety of our assets. To be honest, I am definitely a little worried."

Premier Jinbao's  was right to worry about the safety of China's U.S. debt holdings.   Since March 2009, the U.S. debt has increased by more than $3 trillion and Congress is now being pressured by the Federal Reserve and the Treasury to increase the national debt limit by another $2 trillion.  The parabolic increase in U.S. debt, along with recent downgrade warnings on U.S. debt from the credit rating agencies, must be keeping the Chinese up at night.

US, Pakistan Near Open War; Chinese Ultimatum Warns Washington Against Attack

Webster G. Tarpley, Ph.D.
TARPLEY.net
May 20, 2011

China has officially put the United States on notice that Washington’s planned attack on Pakistan will be interpreted as an act of aggression against Beijing. This blunt warning represents the first known strategic ultimatum received by the United States in half a century, going back to Soviet warnings during the Berlin crisis of 1958-1961, and indicates the grave danger of general war growing out of the US-Pakistan confrontation.

China Becomes World’s Larest Gold Buyer - Buys 93.5 Tonnes Of Gold Coins / Bars in Q1 - Gold Ownership Rising From Minuscule Levels

from Goldcore.com

Gold and silver are higher again today with the debt laden dollar, euro and yen all being sold. News that China has become the world’s largest buyer of gold bullion and has seen investment demand double continues to reverberate in the markets and may have contributed to this morning’s strength.

Both gold and silver are marginally higher for the week and after last week’s gain appear to have regained their poise and are consolidating after the recent sell off.

The Global Dollar Dump Is Already in Progress

The following quotes signal the beginning of the End Game for the US Dollar:

“We hope the U.S. government will take responsible policies and measures to safeguard investors’ interests,” [China’s ministry] said in a statement.

“Foreign-exchange reserves have exceeded the reasonable levels that we actually need,” [China’s central bank governor] said. “The rapid increase in reserves may have led to excessive liquidity and has exerted significant sterilization pressure. If the government doesn’t strike the right balance with its policies, the build-up could cause big risks,” he said, without elaborating.

These two statements, in plain terms, are China saying it’s sick of the US Dollar.

Obama's Super-Secret Presidency

by: John Ransom

 

Nothing displayed Barack Obama’s Achilles’ heel better than the presentation of his birth certificate last week.

Geez. Was that so tough? I thought.

It’s not possible to overstate the lengths to which O’s administration and campaign apparatus go in order to keep secrets from the press and the American people and themselves.

In doing so, they have only succeeded in fooling the last on the list, at enormous cost to the rest of us.

China Proposes To Cut Two Thirds Of Its $3 Trillion In USD Holdings

article from ZeroHedge.com


All those who were hoping global stock markets would surge tomorrow based on a ridiculous rumor that China would revalue the CNY by 10% will have to wait. Instead, China has decided to serve the world another surprise. Following last week's announcement by PBoC Governor Zhou (Where's Waldo) Xiaochuan that the country's excessive stockpile of USD reserves has to be urgently diversified, today we get a sense of just how big the upcoming Chinese defection from the "buy US debt" Nash equilibrium will be. Not surprisingly, China appears to be getting ready to cut its USD reserves by roughly the amount of dollars that was recently printed by the Fed, or $2 trilion or so. And to think that this comes just as news that the Japanese pension fund will soon be dumping who knows what. So, once again, how about that "end of QE" again?

We Are At A Tipping Point For the Dollar And The Chinese Yuan

article by: Robert Lenzner

We are at a  tipping point for the advent of a new global currency that will recognize  the  seeds of the dollar’s fall  and the rise of China as the new world economic power. It will take time, but you could grasp it in the multiple examples of changes being floated in the public arena.  The amazingly steady climb of gold and silver for 5 straight weeks to new peak prices is the signal that investors recognize the dollar and therefore dollar securities are risky. Gold and silver and to a lesser extent oil have become hedges against the dollar’s decline.

WEST vs CHINA: A NEW COLD WAR BEGINS ON LIBYAN SOIL

article by: Patrick Henningsen
21st Century Wire
April 13, 2011


The question as to why US-led NATO forces are determined to engineer a regime change in Libya is now becoming clear. Whilst media pundits and political experts still argue over whether the Libyan rebel gangs are actually being backed and directed by US, UK and Israel intelligence agencies, broader long-range Western policy objectives for Libya are being completely ignored.

The Federal Reserve Must Implement QE3

April 6, 2011

Gold prices surged today to a new all time high of $1,463.70 per ounce, while silver prices soared to a new 31-year high of $39.785 per ounce. Silver is now up 129% since NIA declared silver the best investment for the next decade on December 11th, 2009, at $17.40 per ounce. The gold/silver ratio is now down to 37, compared to a gold/silver ratio of 66 when NIA declared silver the best investment for the next decade. This means that not only is silver up 129% in terms of dollars since December 11th, 2009, but silver has also increased in purchasing power by 1.78X in terms of gold.

Libya - The DC/NATO Agenda

KINGSTON, NY, 4 April 2011 — In the 1930s the US, Great Britain, and the Netherlands set a course for World War II in the Pacific by conspiring against Japan. The three governments seized Japan’s bank accounts in their countries that Japan used to pay for imports and cut Japan off from oil, rubber, tin, iron and other vital materials. Was Pearl Harbor, Japan’s response?

Now Washington and its NATO puppets are employing the same strategy against China.

China Flexes Its Military Muscle

by: The Warning Signs

In case you missed the news report a few days ago about the Chinese frigate that appeared off the coast of Libya I thought I would post a video of it.

What is odd is the fact that this is the first time in history that a Chinese warship has sailed in the Mediterranean. What was even more odd is the fact that CNN was the only mainstream news outlet that I found that reported on this. Apparently the other networks do not see the significance of this event.

Tsunami of Inflation to Hit U.S. with Japan Crisis

The earthquake, tsunami, and nuclear disaster that hit Japan this past week and the destruction that it caused is nothing compared to the tsunami of inflation that will soon hit the U.S. as a result of this crisis. A tsunami of inflation in the U.S. will mean a complete collapse of our monetary system, which could lead to millions of deaths due to a lack of food and heat. 44 million Americans are now dependent on food stamps, but when the U.S. dollar becomes worthless as a result of hyperinflation, the government will no longer have the power to support these Americans and many of them will simply starve to death.

China Overtakes US as #1 Manufacturer

China has become the world’s top manufacturing country by output, returning the country to the position it occupied in the early 19th century and ending the U.S.’s 110-year run as the largest goods producer.

The change is revealed in a study released on Monday by IHS Global Insight, a U.S.-based economics consultancy, which estimates that China last year accounted for 19.8 per cent of world manufacturing output, fractionally ahead of the US with 19.4 per cent.

The Massive U.S. Trade Deficit Destroys 3 Million Jobs A Year

Commerce Department reported the deficit on international trade in goods and services was $46.3 billion in January, up from $40.2 billion in December and $27 billion in mid 2009, when the recovery began. Deficits on oil and with China jumped $1.2 and $2.6 billion, respectively, and the overall trade deficit is blocking the creation of 3 million jobs each year.

Why Isn't The iPhone Made In America?

John McCain provided some good laughs and made himself look stupid on a recent ABC news interview by telling Diane Sawyer that the iPhone and iPad are great examples of products that are made in America.

They're not.