Weekend Open Thread...

America’s Nuclear Nightmare

From the Rolling Stone sent to my by Shaza. Don't worry dear readers The Hive is alive and well. We have at least 250 page views a day and although many may be bots looking to dump their spam Google does a pretty good job of keeping them out. BTW that was a great story Bukko and I want to thank everyone for the reassurance. I am feeling much better about it today. Queenbee
There are 4 pages to the story so follow the link for the whole story on RS.

The U.S. has 31 reactors just like Japan’s — but regulators are ignoring the risks and boosting industry profits

APRIL 27, 2011 9:00 AM ET
Five days after a massive earthquake and tsunami struck Japan, triggering the worst nuclear disaster since Chernobyl, America's leading nuclear regulator came before Congress bearing good news: Don't worry, it can't happen here. In the aftermath of the Japanese catastrophe, officials in Germany moved swiftly to shut down old plants for inspection, and China put licensing of new plants on hold. But Gregory Jaczko, the chairman of the Nuclear Regulatory Commission, reassured lawmakers that nothing at the Fukushima Daiichi reactors warranted any immediate changes at U.S. nuclear plants. Indeed, 10 days after the earthquake in Japan, the NRC extended the license of the 40-year-old Vermont Yankee nuclear reactor — a virtual twin of Fukushima — for another two decades. The license renewal was granted even though the reactor's cooling tower had literally fallen down, and the plant had repeatedly leaked radioactive fluid.
Perhaps Jaczko was simply trying to prevent a full-scale panic about the dangers of U.S. nuclear plants. After all, there are now 104 reactors scattered across the country, generating 20 percent of America's power. All of them were designed in the 1960s and '70s, and are nearing the end of their planned life expectancy. But there was one problem with Jaczko's testimony, according to Dave Lochbaum, a senior adviser at the Union of Concerned Scientists: Key elements of what the NRC chief told Congress were "a baldfaced lie."
This article appears in the May 12, 2011 issue of Rolling Stone. The issue is available now.
Lochbaum, a nuclear engineer, says that Jaczko knows full well that what the NRC calls "defense in depth" at U.S. reactors has been seriously compromised over the years. In some places, highly radioactive spent fuel is stockpiled in what amounts to swimming pools located beside reactors. In other places, changes in the cooling systems at reactors have made them more vulnerable to a core meltdown if something goes wrong. A few weeks before Fukushima, Lochbaum authored a widely circulated report that underscored the NRC's haphazard performance, describing 14 serious "near-miss" events at nuclear plants last year alone. At the Indian Point reactor just north of New York City, federal inspectors discovered a water-containment system that had been leaking for 16 years.
As head of the NRC, Jaczko is the top cop on the nuclear beat, the guy charged with keeping the nation's fleet of aging nukes running safely. A balding, 40-year-old Democrat with big ears and the air of a brilliant high school physics teacher, Jaczko oversees a 4,000-person agency with a budget of $1 billion. But the NRC has long served as little more than a lap dog to the nuclear industry, unwilling to crack down on unsafe reactors. "The agency is a wholly owned subsidiary of the nuclear power industry," says Victor Gilinsky, who served on the commission during the Three Mile Island meltdown in 1979. Even President Obama denounced the NRC during the 2008 campaign, calling it a "moribund agency that needs to be revamped and has become captive of the industries that it regulates."
In the years ahead, nuclear experts warn, the consequences of the agency's inaction could be dire. "The NRC has consistently put industry profits above public safety," says Arnie Gundersen, a former nuclear executive turned whistle-blower. "Consequently, we have a dozen Fukushimas waiting to happen in America."  

Morning Update/ Market Thread 4/29 - Smokin' Edition...

Good Morning,

Equities are climbing again this morning, the last trading day of the month. The dollar continues its slide into nothingness (even relative to other debt saturated currencies), bonds continue higher not in support of equities, oil is higher, gold is in new record territory, silver is still working on breaching the $50 mark despite another attempt to cut it down via margin increases, and food commodities are bouncing slightly after declining yesterday.

It’s typical that a bullish bias exists on the last and first trading days of the month. There was a small movement in the McClellan Oscillator yesterday, so expect a large price move today. Which direction? Well, let me consult my daily pump you up with fluff POMO schedule…

Yep, another $5 to $10 Billion today and every day. Is it ever going to end? I say that if it does we will see an instant return to another wave of deflation. And if they keep it going commodity prices will continue to the moon. Will they keep it going? They have to, the “Fed” doesn’t work for you, they work for the private central banks.

Personal Income and Outlays in March are showing the money printing in action and if this report is even close to accurate then we may be seeing the beginnings of inflation in incomes. If that continues, it will fuel a spiral in inflation expectations that will require more and more money pumping from the “Fed.” Again inflation is hot in this report and I’m certain that aspect of it is understated – here’s Econopray:
The consumer sector got some lift from income growth in March. Personal income in March grew 0.5 percent, following a 0.4 percent gain in February. The latest was a little higher than the median projection for 0.4 percent. Wages & salaries rose a moderate 0.3 percent, softening from 0.4 percent in February.

Consumer spending slowed somewhat in the latest month but was coming off a robust February. Personal consumption expenditures printed at a 0.6 percent rise in March after jumping 0.9 percent the prior month. Analysts had forecast a 0.5 percent gain. The slowing was largely due to a leveling off in durables after the large advance in this component in February. Durables were a little better than many expected as earlier released unit new motor vehicle sales dipped in March. Of course, higher gasoline prices helped boost the nondurables component. Nonetheless, real PCEs managed to gain 0.2 percent, following a 0.5 percent surge in February.

For PCEs in March, strength was led by nondurables (includes gasoline), up 0.9 percent, after a 1.7 percent surge in February. Durables eased to up 0.1 percent, following a 2.1 percent jump the prior month. Services spending advanced 0.5 percent after a 0.4 percent rise the month before.

On the inflation front, the PCE price index continued to be hot, jumping 0.4 percent and matching the February boost. However, the core rate decelerated a bit to a sluggish 0.1 percent rise in March, following a 0.2 percent gain in February. On a year-ago basis, headline PCE inflation worsened to 1.8 percent from 1.6 percent in February. Core PCE price inflation was steady at 0.9 percent on a year-ago basis. The latest core numbers will let the Fed keep arguing that underlying inflation is still soft.

Year on year, personal income growth for March came in 5.3 percent, compared to 5.2 percent in February. PCEs growth posted at a year-ago 4.6 percent, up from 4.5 percent the prior month.

The consumer sector is holding up a little better than expected despite high gasoline prices. The question is whether the price effects are "transitory" as hoped by the Fed. The income gains are at least helping to offset the impact of higher gasoline prices on consumers' budgets.

So then it must be okay to send oil prices to the moon? Heaven help you if you live on a fixed income.

Wait… are wages really increasing or aren’t they? In a separate report, the Employment Cost Index does not show the gains:
A rise in benefit costs fed an above-trend rise in the employment cost index which however shows no acceleration in wages. The ECI rose a quarterly 0.6 percent in the first quarter vs a run of 0.4 percent gains in prior quarters. Year-on-year, the ECI is up 2.0 percent for no change vs the fourth quarter. Wages rose 0.4 percent, the same pace as the fourth quarter, and are up only 1.6 percent year on year. Benefits jumped 1.1 percent for a 3.0 percent year-on-year increase with health benefits for employers up 3.4 percent. For comparison, the year-on-year rate for the CPI was 2.7 percent in March.

I took the liberty of drawing a big fat trend arrow for your wages (err, I mean employment costs). CPI, of course, is trumped and reality is much higher than advertised. I’m giving this report on wages the benefit of a doubt, but who really knows as the data is so widely warped that trust in the money printing central’s data makes one look like an idiot.

Gee, could that be why confidence is being lost in the dollar? Or could that be why China and Russia are on a gold buying binge? Or why central bankers of the world are exchanging their debt backed money from nothing for gold?
Gold Luring Central-Bank Buyers May Extend Record Rally in Price

April 29 (Bloomberg) -- Central banks that were net sellers of gold a decade ago are buying the precious metal to reduce their reliance on the dollar as a reserve currency, signaling demand that may extend a record rally in prices.

As developing countries accelerate purchases, gold may reach $2,000 an ounce this year, compared with a record of $1,538.80 yesterday in New York, said Robert McEwen, the chief executive officer of producer U.S. Gold Corp. Euro Pacific Capital’s Michael Pento, who correctly predicted gold’s highs for the past two years, forecast a 2011 high of $1,600.

Prices reached a record 14 times this month on demand from investors seeking an alternative to the dollar after the currency slumped to the lowest since 2009, U.S. debt widened, and the Federal Reserve signaled April 27 that borrowing costs will remain near zero percent for an extended period. The economy in China, the biggest foreign holder of U.S. Treasuries, grew 9.7 percent in the first quarter.

“China is out to have more gold than America, and Russia is aspiring to the same,” McEwen said yesterday in an interview in New York. “When you have debt, you don’t have a lot of flexibility. China wants to show its currency has more backing than the U.S.”

In 2010, central banks became net buyers for the first time in two decades, adding 87 metric tons in official-sector purchases by countries including Bolivia, Sri Lanka and Mauritius, according to World Gold Council data. China, with more than $3 trillion in foreign-currency reserves, plans to set up new funds to invest in precious metals, Century Weekly reported this week. Russia purchased 8 tons of gold in the first quarter.

China’s Gold Reserves
China, which has just 1.6 percent of its reserves in gold, may invest more than $1 trillion in bullion, Pento said. “China wants to be an international player, and they need to own more gold than they currently have.”

The U.S. Treasury Department projects the government could reach its debt ceiling of $14.3 trillion as soon as mid-May and run out of options for avoiding default by early July. The Fed has kept its benchmark rate between zero percent and 0.25 percent since December 2008 to help stimulate the economy, driving the dollar down 11 percent against a basket of six major currencies during the past year.

“Until monetary policy changes, you’re going to continue to see gold go up,” said Michael Cuggino, who helps manage $12 billion at Permanent Portfolio Funds in San Francisco.

“Ultimately the best thing we can do to create strong fundamentals for the dollar in the medium term is first, keep inflation low, which maintains the buying power of the dollar, and second, create a stronger economy,” Fed Chairman Ben S. Bernanke said on April 27.

Uh, huh. The handwriting has been on the wall for quite some time. But remember, those who produce the money are the ones WHO are really in control. In this nation that would currently be the private banks. They know that the math of debt doesn’t work, and I still think that switching to a gold backed money works for them as long as they are still the ones who control and produce the money.

While the U.S. is supposedly the world’s largest holder of gold, that gold has not been truly assayed for decades, and in that time the central bankers have been acting as if they own it (you really own it). They have acted freely to swap it all over the globe and even though that gold truly belongs to the people, they won’t even allow an audit of their activities. So who knows how much gold there is in reality?

The lesson here is two-fold. First and foremost, what’s most important is WHO controls the production of money. Secondly never trust private individuals with your physical gold – always take and maintain delivery of the real thing – paper gold is an outright swindle.

Speaking of swindle, evidently the EU is tired of being swindled:
Goldman Sachs, JPMorgan Among 16 Banks Probed by EU Over CDS

April 29 (Bloomberg) -- Goldman Sachs Group Inc., JPMorgan Chase & Co. and 14 other investment banks face a European Union antitrust probe into credit-default swaps for companies and sovereign debt.

The European Commission is investigating whether 16 bank dealers, including Citigroup Inc. and Deutsche Bank AG, colluded by giving market information to Markit, a financial information provider. Regulators will also examine whether nine of the firms struck unfair deals with ICE Clear Europe, a clearinghouse for derivatives, shutting out competitors.

“Lack of transparency in markets can lead to abusive behavior and facilitate violations of competition rules,” Joaquin Almunia, the EU’s competition commissioner, said in an e-mailed statement. “I hope our investigation will contribute to a better functioning of financial markets.”

Global regulators have sought to toughen regulation of credit-default swaps, saying the trades helped fuel the financial crisis. The EU’s probe into the CDS market adds to separate investigations in the U.K. and U.S into whether banks colluded to manipulate the London interbank offered rate.

Possible Collusion
Bank of America Corp., Barclays Plc, BNP Paribas SA, Commerzbank AG, Credit Suisse Group AG, HSBC Holdings Plc, Morgan Stanley, Royal Bank of Scotland Group Plc, UBS AG, Wells Fargo & Co., Credit Agricole SA and Societe Generale SA will also be investigated for possible collusion in giving “most of the pricing, indices and other essential daily data only to Markit.”

The commission said this “may have the effect of foreclosing the access to the valuable raw data by other information service providers.” It said some of the clauses in Markit’s licence and distribution agreements “could be abusive and impede the development of competition in the market for the provision of CDS information.”

The EU will also separately investigate credit default swap clearing agreements struck by ICE Clear Europe with Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, JPMorgan, Morgan Stanley and UBS.

‘Behaved Badly’
“What we are looking at is whether the main players in the market have behaved badly, have entered into anti-competitive agreements or abused a possible dominant position,” Amelia Torres, a commission spokeswoman, told reporters in Brussels today.

Oh yeah… Collusion, “Lack of Transparency,” Manipulation, Abusive, and most importantly “Behaved Badly.” Uh huh, and just look at the names associated.

Of course we’ve been preaching about this for years. But nothing will be done that has any meaning because they are the ones WHO have wrongly been allowed to control the production of money, and then they sent the bill to you and me. Ridiculous – these banks and their schemes need to be cut down, a truly healthy economy will prove to be elusive until that occurs.

The Chicago PMI was just released for April. It fell from 70.6 to 67.6 which is also below consensus. “Consumer” Sentiment was also just released for April, and came in very close to March’s level at a still depressed 69.8 on their Index.

'Fukushima - gross miscarriage of radiation science'

Someone's smokin' alright - But I think Bernanke plans to keep on tokin'...

The Federal Reserve Is Selling Paper Gold and Buying Physical Gold

The good ole "American way"—through proxies
A couple of weeks ago, I pitched an idea to some associates of mine who are involved in SERIOUS [tonnage] PRECIOUS METALS procurement—physical metal only—let's just say HUGE money.  I asked them if they would be interested in purchasing an “option”—cash up front—for the exclusive rights [first right of refusal on off-take] of a gold producer [miner] for a set number of ounces for 3–5 years "at the market"—using LBMA pricing [a.m./p.m. fixes] in the future.  The answer I got back from my associates was "show us a terms sheet, we definitely have interest."
So, I spoke to a friend who is very close to an intermediate producer who is in the mode of raising money right now.  I had them ask the producer if they would have interest – the producer said, "YES, we are interested—but just to let you know—J.P. Morgan has been asking us if we would sell them the same option."  So, while gold producers have shuttered their "gold hedge books"—the Bullion Banks are "synthetically" trying to keep physical output captive—I would suggest FOR THE EXPRESSED REASON THAT THEY SELL EVERY PHYSICAL OUNCE AT LEAST 100 TIMES OVER.
Gold is going to get EXTREMELY scarce in the future folks.  Big money interests are now cutting off [or bidding for / gaining exclusive access to] the traditional bullion supply chain "at the pit."
The shorts of "paper gold" at J.P. Morgan [the Fed in drag] are selling the daylights out of the paper market and simultaneously buying exclusive rights to producers' future production so they can try to fudge their way through an unmitigated fraud and settle a big enough chunk of their bad bets to keep this "systemically ruinous" precious metals Ponzi scheme alive.

Price of Gold and Interest Rates Are Joined at the Hip

The academic research that outlines the inter-relatedness of gold and interest rates is succinctly laid out in a 2001 treatise, Gibson's Paradox Revisited, by Reg Howe.  From this one can deduct that ANY rigging of the gold price must go hand-in-hand with simultaneous rigging of interest rates.
Folks would do well to realize how neatly emerging details of Fed surrogate Morgan's  "stealth" activity in the bullion market dovetails with their obscene, obsequious activity elsewhere in their derivatives book—particularly their JUMBO TRILLIONS sized interest rate swap positions.
Stealth activity on the part of the Fed—utilizing proxy institutions to generate limitless artificial demand for any and all U.S. Government Debt—effectively gives the Fed control of the long end of the interest rate curve [the bond market].
From a timing perspective, it is also noteworthy that gold price rigging—long maintained by GATA—is alleged to have begun in earnest during the Clinton Administration with the appointment of Robert Rubin as U.S. Treasury Secretary [along with understudy Lawrence Summers] in Jan. 1995.  Coincidentally [or perhaps not?] we can trace the genesis of the "explosion" in the use of derivatives [mostly interest rate] to that exact same time frame.  In fact, if we follow the time line in "reverse"—the growth in the use of derivatives appears like a trail of bread crumbs —right back to the time when Professor Lawrence Summers, under the tutelage of Sir Robert of Rubin, brought his academic alchemy to Washington:
iinterest rate swaps
Does anyone with a pulse really believe that ANY Bank Holding Company in the U.S. would be permitted to have a derivatives position in excess of 75 TRILLION [five times the size of U.S. GDP] if they were not "in bed" with the FED????
If you except the premise that, "J.P. Morgan 'is' the Fed," then, "IT'S REALLY THE FED WHO IS BUYING GOLD" and they [unfortunately, this means "America"] likely have NONE LEFT to sell.
NOTHING could be more bullish for the price of gold going forward.
Everyone needs to get it through their heads; these criminals are NOT IN IT for profits.  The survival of our "BROKEN FIAT MONEY SYSTEM" "IS" their only goal.


Officialdom will never admit it and it will NEVER be reported in the mainstream financial news but our financial system has NEVER been in a more precarious state. A banking crisis of unparalleled proportions is coming—probably soon—the exact timing is still sketchy.

Republicans Dismiss Unrest Over Medicare Revamp as Orchestrated

U.S. House Republicans pushing to overhaul Medicare dismiss the vocal opposition some have encountered from constituents as orchestrated by political foes.
The Republicans, who have spent much of the two-week congressional recess fending off questions from voters about the proposal, say they are standing by the plan, a cornerstone of the 2012 budget measure the House passed April 15 on a party- line vote.
They’re blaming much of the criticism voiced at town-hall meetings, which sometimes turned raucous, on activists dispatched by MoveOn.org and other Democratic allies, even as some of the lawmakers have taken measures to control the tone of forums.
“This is not genuine anger over Medicare; it’s manufactured political anger that’s causing the disturbances,” said Representative Lou Barletta, a freshman Republican from Pennsylvania.
At one forum, Barletta offered a slide show detailing the Republican plan, written by House Budget Committee Chairman Paul Ryan of Wisconsin. It calls for replacing the traditional Medicare health-care system for the elderly by providing those currently under the age of 55 with subsidies to buy private insurance. His presentation quickly devolved into a shouting match after a constituent accused Republicans of trying to destroy the program.
Barletta dismissed the hecklers as Democratic plants and said he would keep promoting the plan in public forums. “It’s very important for me to continue to have these meetings to make sure that seniors know they have nothing to worry about,” he said.

‘Extreme Ideology’

Democrats rejected the accusation that they had orchestrated the outrage.
“Republicans must be so blinded by their extreme ideology that they can’t see what’s happening at town halls across the country where the American people are rejecting their radical scheme to end Medicare and raise health care costs for seniors,” Jesse Ferguson, spokesman for theDemocratic Congressional Campaign Committee, said in an e-mail.
The executive director of MoveOn.org, Justin Ruben, said in an e-mail that his group “is simply encouraging our members to attend town halls and talk to their elected representatives about their votes to abolish Medicare.”
“Republicans dismiss this anger at their peril,” he said.

Political Pressure

The confrontational tone of meetings like Barletta’s highlight the political pressure confronting Republicans as they attempt to fulfill campaign promises to reduce the federal deficit and, in the process, alter the entitlement programs that are its biggest drivers.
While voters say they want politicians to bring down the deficit -- which the Congressional Budget Office estimates will reach $1.4 trillion by Sept. 30, the end of the 2011 fiscal year -- surveys show that they don’t want to significantly change entitlements such as Medicare and Social Security.
“The perception of the American public is we can fix all our problems if we just didn’t waste the money,” said Ed Goeas, head of the Tarrance Group, a Republican polling firm in Alexandria, Virginia. “Which makes getting into the discussion of how we make programs better more difficult.”
A Washington Post/ABC News poll conducted April 14-17 found that 78 percent of Americans oppose cutting Medicare spending to lower the debt and 65 percent said Medicare should remain as it is, rather than providing recipients with a check or a voucher from the government to purchase private insurance.
The budget crafted by Ryan would slash U.S. spending by $6.2 trillion over a decade by cutting Medicare and scores of other programs, including Medicaid, food stamps, farm subsidies and Pell college tuition grants.

Medicare ‘Crisis’

As they left for the congressional recess, Republican leaders said they and their colleagues needed to focus on discussing the Medicare issue. “It’s important for our members to go home and talk about the crisis that we face” in the program’s funding, House Speaker John Boehner, an Ohio Republican, told reporters on April 15.
Democrats and their allies had their own plans for the recess, mobilizing a campaign of automated phone calls, advertisements and protests that charged the Republican aim was to end the program.
The House Majority PAC, a political action committee focused on helping Democrats regain the House majority in the 2012 elections, ran radio ads in 10 districts in which an announcer said Republican lawmakers had voted for a plan that “threatens to end Medicare as we know it.”
In an April 26 interview with ABC News, Boehner cautioned that while he backed the plan, he was not “wedded to one single idea” to tackle Medicare.
“I’m for it. It’s our idea,” he said, “but other people have other ideas.”

Wider Focus

Republicans also have sought to switch the focus from Medicare to overall federal spending -- a more challenging issue for Democrats who, polls have shown, face voter skepticism that they are willing to tackle the budget deficit.
The National Republican Campaign Committee launched a three-week run of ads targeting 13 fiscally conservative Democrats, featuring an announcer saying that the lawmakers “refused to vote for any of the five budget proposals that cut spending.”

Security Concerns

Still, even Ryan has faced mixed receptions at public meetings in his district. Several news outlets reported that attendees booed Ryan at some of those sessions this week. He left one of them, on April 26, through a different door and in a different car due to security concerns, according to a report by Milwaukee television station WTMJ.
Representative Dan Webster, a freshman Republican from Florida, faced a confrontational crowd at an April 26 town hall meeting that included a shouting match. Video shot by Orlando television station WFTV showed hecklers holding up signs that said “Hands off my Medicare” as Webster stressed the Ryan plan’s exemption for those 55 and older from the privatization provisions.
A few Republicans have worked to restrict the typically open nature of the town hall forum.
In their town hall sessions this week, freshman Representatives Allen West of Florida and Michael Grimm of New York asked moderators to select and vet questions submitted by constituents.
Despite such efforts, three hecklers were removed from West’s forum in Fort Lauderdale on April 26, including one in handcuffs, according to local news reports.
A Democratic website, BlueBroward.org, had urged Democrats to question West at the session. “We need everybody (especially seniors) at this town hall meeting -- media will be present!” a member of the group posted on the site last week.
West said the protesters wouldn’t change his position.
“I am disturbed that a select few of people are using these informative events as their own personal soapbox,” he said in a statement. “I will not be intimidated.”

Morning Update/ Market Thread 4/28 – Con men, Sideshows, and Carnival Barkers Edition…

Good Morning,

Ever notice that the word “CONfidence” begins with the root con? I’ll have more on that in a minute…

Meanwhile, stocks are down, the dollar is down and has been more or less crashing nonstop (but is now bouncing a little due to bad economic data), bonds are shooting higher on the bad data, oil set a new high and pulled back slightly, gold is at another new all-time high, silver is climbing again back to just under $50 an ounce despite margin intervention just the other day, and most food commodities are just slightly lower.

Weekly Jobless Claims shot up from 403,000 to 429,000. This is the third week in a row now back above 400k, and this rise was against expectations that it would fall to 390k. Here’s Econohope finding it hard to continue the improvement claim:
Initial jobless claims are definitely on the rise and it may not be auto related. Initial claims jumped 25,000 in the April 23 week to 429,000 which is nearly 40,000 above expectations (prior week revised 1,000 higher to 404,000). The Labor Department said layoffs in the auto sector were isolated and not a major factor. The four-week average rose a steep 9,250 to 408,500 and is nearly 15,000 above the month-ago level. Initial claims were on a convincing downward trend, but no longer with this month's data pointing to trouble for the April employment report.

Any number above 350k represents job contraction, jobs have been contracting now for years, not just months.

GDP for the first quarter supposedly rose by an annualized rate of 1.8% against expectations of 2.0% or more. This is down sharply from Q4’s 3.1%. Here’s Econospin, then I’ll de-spin it for you:
The economy slowed during the first quarter of 2011. However, the detail shows moderate forward momentum. First quarter GDP growth eased to a 1.8 percent annualized pace, following a 3.1 percent boost in the fourth quarter. First quarter growth came in lower than the median projection for 2.0 percent.

The softer growth in the first quarter was largely due to a sharp upturn in imports, a deceleration in personal consumption, a larger decrease in federal government spending, and decelerations in nonresidential fixed investment and in exports that were partly offset by a sharp upturn in private inventory investment.

Nonetheless, relative strength was seen in personal spending, investment in equipment & software, and inventory investment. Exports also continued to rise although not as rapidly as earlier. PCEs rose an annualized 2.7 percent, following 4.0 percent in the fourth quarter. Equipment & software improved to 11.6 percent from 7.7 percent the prior quarter. Inventories rose a moderate but stronger $43.8 billion, compared to $16.2 billion in the fourth quarter. Exports gained 4.9 percent in the first quarter, following 8.6 percent in the previous quarter.

Weakness included a drop in government purchases (down 5.2 percent), nonresidential structures (down 21.7 percent, residential structures (down 4.1 percent), and imports (up 4.4 percent).

Final sales of domestic product posted at a sluggish 0.8 percent in the first quarter, compared to 6.7 percent the prior quarter. Final sales to domestic purchasers (takes out net exports) slowed to a 0.9 percent increase from a 3.2 percent rise in the fourth quarter. Deceleration in both was primarily due to a sharper drop in government purchases and a fall in structures investment-especially nonresidential but also residential.

Economy-wide inflation picked up with the GDP price index jumping _ percent from a modest 0.4 percent rise in the fourth quarter. Analysts had forecast 2.2 percent.

Year-on-year, real GDP in the first quarter is up 2.3 percent, compared to 2.8 percent in the fourth quarter.

Economy-wide inflation picked up with the GDP price index jumping 1.9 percent from a modest 0.4 percent rise in the fourth quarter. Analysts had forecast 2.2 percent.

Overall, the headline number was disappointing as were the final sales figures. But key components-consumer spending, equipment investment, and inventory investment-are maintaining forward momentum.

The GDP report is nothing but fluff – and is a big part of the CON. It’s so far removed from reality that I’m personally shocked that anyone takes this seriously. The big picture is that DEBT should not count as productivity, nor should any financial engineering – remove that and our true productivity would likely be half of what is reported. But let’s ignore that and play along with the central banker game…

Below is the table from the BEA’s GDP Report with the current “deflators” highlighted:

The “Deflator” is used to supposedly correct for inflation to make the GDP number “Real.” This deflator is supposed to represent annualized inflation. So, the BEA adds up all the “productivity” and then subtracts the deflator to find “real growth.” Note that last year there was a string of 2.0% deflators, then in Q4 it fell to .3%, and is now a supposed 1.9%.

Okay, but does that really represent annualized inflation? Not even close. Of course the PPI and CPI numbers are also complete fantasy, but as I look around I see a set of numbers that seems closer to the truth – namely Import and Export Prices. March is the end of Quarter one, and in the month of March Import prices were reported up by 2.7% just for that month alone! Annualize that number (without compounding) and it’s a staggering 32.4%! But if you just add up the prior year’s Import price inflation, it adds up to 9.7%!!! And just to prove that this is no fluke, export prices rose 9.5% in the past year even with our government’s own figures.

Import and export prices more accurately measure the true fall in the value of the dollar. Now, trade inside of the United States may not see all of this price inflation immediately, that takes time. Still, real inflation, in my opinion, is much greater than the deflator values suggest. In essence what I’m saying is that the supposedly positive GDP reflects money creation, not productivity as it is anything but “real.”

Remember, there are three types of “money;” Sovereign, credit, and “other” (derivatives, margin, etc.), the total of which is completely impossible to track and very much out of control.

Let’s take a quick look at a long term dollar chart that Jesse made, this will give you the long term perspective of just how far the dollar has fallen in value versus the “basket” currencies it is measured against:

The dollar is now down in the .72 region, not far above the all-time lows.

Keep in mind that the dollar index is NOT real either – all the currencies in that basket are depreciating. So, to see real, you need to compare the dollar to something outside of that basket, and that would be the real price of tangible things – just look at the price of gold or even a candy bar to get an idea of real dollar devaluing.

So, if stocks rise while the dollar is falling in value, is the rise “real.” No, because that share of stock, if sold, will actually buy you less than it used to.

And now we have an interesting development with the Russell 2000 small cap Index rising to new all-time highs yesterday:

Of course the other indices have a way to go, but the Transports are pretty close, while the NDX and XLF are very far away from their respective all-time highs. Still, should the major indices join the RUT, then the big picture wave count changes. And this is exactly why McHugh has changed his big picture outlook to a belief that the Grand Supercycle wave III did not in fact top in the year 2000 as almost everyone believed. If his read is correct, that means that the timeframe from the year 2000 until March 2009 was wave 4 within III and that we are currently in a wave 5 movement to complete Grand Supercycle III. If that read is correct, then it means that once wave 5 of III tops, that we will experience something on a larger scale than the past decade as wave IV progresses.

I personally do not know what is true in regards to the waves, but what I see fundamentally is that money printing allowed the private banks to capture the markets and to capture our political system. I think that waves will happen until complete confidence in the current money system is gone, and that confidence is eroding further every day.

Bernanke’s CON of a press CONferenence didn’t seem to promote CONfidence in the dollar. Instead the dollar tanked some more, gold, silver, oil, and even stocks rose as there is obviously no end in sight to zero percent interest rates or the artificial money printing and capture of the planet.

For confidence to flourish, people must believe that the rule of law is being upheld. I maintain that there is the natural rule of law, and then there is the man-made version which can be manipulated and changed. I maintain that the bankers have captured politics with their money printing, and that they have had the man-made laws changed to suit them. The gap between the man-made laws and what is real and natural is getting larger and larger. As that gap grows, it will reach a point at which the people will just find it unacceptable to live with the glaring gap.

The most important natural rule of law is that the agreed to money system not disadvantage the majority. This is the basis of usury and why it is so important – in this regard we are miles and miles away from the natural and proper order of things (rule of law). But a symptom of the money capture is political capture… and this is why it’s important to have leaders that we have confidence in.

And I must say that I did not have any confidence in George Bush, but I now have even less confidence in Obama. Both, of course, are obvious puppets of the central banks – as have national level politicians been since the CON of the “Federal Reserve Act.” But never in my life have I seen so many con men in so high of places.

First of all, I’ll point out that Donald Trump is nothing but a narcissistic con man – what he does he does for his own gain, not for the gain of humanity. Again, simply look at his stance on the banks and on Wall Street – he has repeatedly stated that he would leave them alone, and if anything would further deregulate them. That alone is all you need to know – he is making overtures for his own personal gain and thus what he says lacks the underlying truth.

Now, let’s address the “birther” issue… I started out skeptical. In fact, I even was guilty of ignoring this issue and falling into the media boxing it in as “nutty.” Like most people, I failed to appreciate fully the implications that it represents – so let’s take a fresh big picture look. This issue is important for several reasons, the largest of which is confidence.

A nation’s leader should have 100% of their loyalty resting in the country which they lead. If they do not, then they may fail to make decision to the benefit of those who he represents. With Obama, I think any rational, thinking, American has to wonder if that is the case. The issues are much more complex than simply being born in the United States… It is possible to be born in the U.S., but to not have 100% of your loyalties here – that is one major issue that is largely ignored. But to me, the way this whole issue has been handled destroys my personal confidence in our President.

If it were me, I would have simply provide the long form, notarized copy of my certificate that’s sitting in the drawer in my desk a long time ago. By the way, my certificate is worn, folded, and is obviously not fresh off the computer printer. Still, a fresh copy can be requested from the hospital, but if it comes from the hospital, I can guarantee you that it doesn’t come in a layered .pdf form…

Something is not kosher. For it to be in .pdf form at all, it would have had to have been scanned as a whole, not layered. And that to me casts Obama in the role of a CON MAN. And in turn that further erodes my CONFIDENCE in him and in his administration – and that is why this is such an important issue that is being made more important by the day. Obama’s “Sideshow, and Carnival Barker” comment yesterday was obviously aimed at Trump. Yet, if Obama was not himself a CON MAN, then he would not be forced to step inside of the circus tent – and that is clearly where he resides.

No, this issue is not dead, it is more important than ever as this document release, if proven to be trumped (and I think the .pdf layers do that), then it could be the downfall of a President. And I must say, that he deserves the downfall for many things, he is not an adult and has failed to reel in and contain the out of control central bankers. The results of which are a destroyed middle-class, unnecessary wars (and thousands of deaths), totally captured markets, and the loss of confidence in our monetary and political systems. Obama’s lack of honest dealing with the “birther” issue absolutely is important – it strikes at the very character of our markets, of our political system, and the way in which we represent ourselves to the rest of the world. We are being led by a CON MAN, not that changing him out will change that – we must change out WHO controls the production of money to have significance.

Meanwhile, the special interest captured government of Japan is failing to reel in TEPCO who is absolutely making the Fukushima matter worse. More radiation, and now tinkering with the reactors and fuel rod pools is getting very dangerous with the threat of further explosions possible. Particles heavier than plutonium are now being found in the United States, and the total radiation being expelled is rising to new heights. There are too many details to cover here, so please join us in the daily thread if you wish to understand the real issues involved.