Update 1: Silver/gold shorts days are numbered. Got physical?
After reading an excellent first hand experience about the chaos that has erupted across Greece, one cannot help but draw numerous and alarming similarities between Greece and the U.S., especially given that both have very similar - shall we say - "debt problems."
Take for example this excerpt and see if it sounds anything like what America, most European nations and other developed nations are experiencing on an unprecedented level:
"And all Greeks can attest to this; everyone I talked to seemed to have either a personal story or of people they knew that lost their jobs, whose wages were cut in one way or the other, PhD’s who had to take up jobs in supermarkets to survive, or people who were just jobless for endless amounts of time, depending on family and friends for survival."
In late 2008, it was already evident that the economy had descended into a downward death spiral - one that it would never recover from. A widely circulated newspaper in Ohio reported that a single job opening for a janitorial position at a high school in rural Ohio received over 700 (seven hundred) job applications - for one job opening paying $15/hr. The superintendent of the high school was quoted as saying that under normal circumstances, this job opening would receive a dozen or so applications but they had received over 700 applications, from people with everything from two year college Associate Degrees to those with advanced college degrees and/or who had formerly worked in well paying "white collar" positions. Does this sound very similar to what the witness in Greece was saying? If we had written this blog back then, we would have concluded that the worst was yet to come.
As we have highlighted numerous times, the "stock market" indices are not an indicator of economic health, especially now that $2 Trillion in "stimuli" have been pumped into these "markets." There's nothing "market" about these "markets." Thus, the fundamental metrics that once mattered such as employment rates, food stamp participation rates, inflation rates etc, no longer have any impact on these markets - that's not to say that they no longer matter at all. On the contrary in fact, these are the very basis for taking a true reading of the economy - and all of them are indicating this patient is on life support in the ICU, in a coma with no chance of recovery as gangrene and other infections have now spread throughout the body. If the "economy" was a real patient, the doctors would be preparing to inform the family that funeral arrangements should be made.
From the Challenger Job report, we see that the number of planned job cuts announced by employers increased by 4,297 or 11.6% to 41,432 in June. That is the only line in the report that matters. Did we mention the Too Big To Fail, Too Corrupt To Save banks are prepping for big layoffs? No wonder why there is no talk of a "double dip recession" - the global economy now faces a triple dipper depression.
As every talking head on CNBS since 2009 was claiming China would be the White Knight in shinning
Speaking of plastic rice, the unprecedented weather around the world is going to put a hamper on any "economic growth" for the next, well - indefinite fiscal quarters. In other words, don't expect food prices to deflate any time soon. The production of most food staples has reached a critical point as weather from Australia to Russia to Canada has disrupted the planting and harvesting process - everything from oats to corn to rice to wheat are going to get a lot more expensive. In turn, animal protein will also increase in price exponentially. Maybe plastic rice is not that bad?
Could it get worse? It will if the "gates of hell" open up and spew more ash around the world. Last year, the Eyjafjoell volcano in Iceland erupted, causing the largest shutdown of air traffic since WWII, grounding more than 100,000 flights and the economies of Europe. Now, "the big one" is getting ready to blow. The most feared of all, Hekla (aka the Gates of Hell) is heating up. Once she blows, air traffic will shut down for weeks, possibly months. We predict, immediately following the eruption (if the MSM gives it coverage) the talking bimbos on CNBS will get on the horn and hype that latest catastrophic event as bullish for the global economy and say investing in
Why wait? The current economic storm that is fast approaching is very similar in appearance to this freak 50 mile wide dust storm in Arizona, only worse and covers a distance of 24,900 miles. Ask any realtor, stock broker pimp, used car salesman - the answer always is "there is no better time to buy [insert whatever they are selling] than right now." Just ignore those storm clouds.
As we reiterated just yesterday, the PIIGS are lining up to be slaughtered, for bacon - namely, for bacon strips and bacon strips and bacon strips. Greece, the fattiest of them all has already sold their citizens down the river by attempting to sell off public assets and the citizens have fought back with strikes and riots, which will get more and more violent as austerity is implemented fully in the coming months. Greek bonds have not budged on the sell out, and remain in the junk bin as investors know the inevitable outcome is still default. Yesterday, Moody's cut the P in PIIGS to junk. How's that 12.7% yield on the 10yr working for the European (Dis)Union? Not too well. Ireland is next in line in 3... 2... 1...
As always, these ratings agencies come late and swing soft - we downgraded all of the PIIGS in March to junk although we don't get the same recognition as the official ratings agencies so it means nothing. Except to us. Contagion is a five letter acronym that begins with the letter P, but safety is a four letter word that begins with the letter G. We also like the S word which has six letters, not four. (Don't tell anyone but the paper price means nothing. It's all about the physical.)
There's nothing more bullish for the economy than a gov't on the brink of defaulting - and we're not talking about the PIIGS. Here in the U.S. where the "debt ceiling" has been breached, the last resort to keep the lights on is
raping and pillaging to "tap" the pension funds - which now have been "tapped" by a total of $120 Billion. Therefore, if the debt ceiling is raised (to Pluto), the total debt on the books will be instantly increased by $120 Billion before a single light bulb is turned on. If the debt ceiling is not raised, the Treasury will continue to plunder the retirement fund until there is not a red cent left for the retirees. Of course, in the meantime, the Too Big To Fail & Too Corrupt To Save tax payer bailed out banks will issue their executives another round of record bonuses. We're 100% Bernanke certain that in 15 minutes this won't end well.
Speaking of not ending well, Fukushima truly is what many people around the world are calling an ELE or "extinction level event." It is sad to read the news still pouring out of Japan (like the radioactive particles encircling the earth) and our hearts go out to the good people who trusted their leaders but will pay with their lives. We present to you today's 5 top news events related to Fukushima.
1- Reactor 1 dry well radiation measurement hits a new high of 266 Sv/hour. Of course, now that this reading is worse than ever indicating ongoing fission and leakage, the gov't denies the credibility of the meter and says the meter is defective. Deny, deny, deny. Extend and pretend. Extend and pretend. Sound familiar to how the global economy is being handled?
2- The Fukushima cover up is unraveling fast. "George Washington" does an excellent job at summarizing the gigantic cover up of Fukushima and the coming consequences. As one recently "resigned for personal reasons" former Japanese gov't official just stated, "there will be chaos [once the truth comes to light]." Get ready for some real shockers.
3- Dirt containing 17,020 Becquerels/Kg of cesium-137 was cleaned out from an elementary school swimming pool in Ibaraki Prefecture. The worst part is - children did the clean up.
4- The Japanese gov't plans to reduce the evacuation zone on the 17th of July. Unethical. Immoral. Disgusting. Filthy. We're at a loss for words. With the radiation levels 20-40 miles outside of this evacuation zone increasing daily, we really have no words to describe this news.
5- British Columbia, Canada sees spike in the number of sudden infant deaths. Not two weeks ago, it was reported that sudden infant deaths in the the Northwest United States increased by 35% in the weeks immediately following the global catastrophe of Fukushima. Now in B.C. Canada, sudden infant deaths have increased 38%. The coroner has the audacity to say, “why so many of those have come up this year, we don’t know.” We do. Connect the dots.