The Direction Of The Economy Is Not Going To Change

By Bob Chapman

(Mr. Chapman is 72 years old. He was born in Boston, MA and attended Northeastern University majoring in business management. He spent three years in the U. S. Army Counterintelligence, mostly in Europe. He speaks German and French and is conversant in Spanish. He lived in Europe for six years, off and on, three years in Africa, a year in Canada and a year in the Bahamas.

Mr. Chapman became a stockbroker in 1960 and retired in 1988. For 18 of those years he owned his own brokerage firm. He was probably the largest gold and silver stockbroker in the world during that period. When he retired he had over 6,000 clients.)

Suckers rally in the markets, Dow will be driven down again, market gyrations motivated by insider greed, bank acquisitions point to a greater agenda, despite what economists and institutions are attempting, the economy will remain in a spiral

In the first three weeks of April this year, insiders for NYSE listed companies sold 8.32 times more stock, by dollar value, than they purchased. What does that tell you? We won’t insult your intelligence by answering. If ever there was an indicator to identify a sucker’s rally, this would be it. This is the ongoing Big Sting Two as strength is created by the PPT for insiders to sell into as our economy collapses under a dollar-busting juggernaut of fiat paper, aka Federal Reserve notes, being monetized at light speed as our President and Congress go on a spending spree that makes the spending habits of a Saudi sheik’s entourage look like those of a group of Welsh penny-pinchers. So much for “beloved” Emperor Obama’s promise to put an end to legislative pork and fiscal profligacy.

The insider sales being made in public view pursuant to insider trading rules are just the tip of the iceberg when it comes to Big Sting Two trades, most of which are done behind our backs in dark pools of liquidity such as Project Turquoise, Baikal and the OTC derivative markets, which are totally opaque and unregulated. As a result, the SEC has no public record of insider trades to scrutinize, not that it matters, because they only prosecute the scapegoats set up by elitist flimflam artists while the real criminals profit handsomely from their crimes. Then, of course, once the rally has reached its manipulated end as disclosed in advance by the PPT to insiders, all the elitist insiders go short while strength on the sell side is created for them to short into as investors are terrorized by Cramer and/or Buffet. If you are not an insider, you need to get out of the stock markets and bond markets – NOW!!! – with the exception of gold and silver shares or short postions. It is suicide to try to beat them at their own game. Do not empower them by giving them your money so they can steal it from you.

Remember, the elitist scum running the PPT do not have to drive the Dow back to 14,000 again. They just have to gyrate the stock markets up and down, alternately producing opportunities to go long and then to go short, creating mega-profits for Illuminist financial companies which are attained with money borrowed at zero interest and leveraged at psychopathic levels, while trillions in derivative losses continue to be hidden via government-approved mark-to-model rules. Then the zombies say: See, we are healthy, profitable and have plenty of capital. Therefore, we no longer need your TARP money, which is stopping us from paying out handsome salaries and bonuses to our henchmen criminals who continue to milk the system, and their shareholders, right down to the very last drop. It’s sort of like a Maxwell House commercial about the goodness of its coffee. Da-da da-da, da da, da da-da, da da.

These market gyrations will continue until the markets can no longer be floated on a cloud of hot air created by the combined forked-tongued exhalations of elitist bootlickers, Obama, Bernanke and Geithner, as they pathologically lie about so-called signs of recovery to draw sheople-sucker-dupe herds back into the meat (stock) markets for a fresh new slaughter. Roast mutton anyone? Even the media morons sound as if they are both stunned and stupefied as the markets continue to hold against the worst economic news in our history, with a potential pandemic thrown in for good measure.

They are calling this new phenomenon the “see no evil, hear no evil, speak no evil” stock markets, which is really just the next iteration of what we have called the Goldilocks Matrix in many past issues of the IF.

As we continue to privatize profits and socialize losses with the latest stimulus package, to be followed soon by many more packages totaling multiple trillions, the Fed continues to monetize treasuries to create what would be, at current rates of return, an otherwise non-existent market in US treasuries, while using a portion of these monetizations to also buy agency paper from foreign holders in support of what would be, at current rates of return, an otherwise non-existent market in agency paper.

Decreases in real interest rates that are charged to the public and to non-Illuminist companies have been paltry because no matter how much paper the Fed buys from the Treasury, the truth about the zombie state of our economy does not change, and, of course, the Illuminist bankers want to maximize spreads so they can generate profits, and the outrageous salaries and bonuses that come with those profits.

Remember, the Fed already gives Illuminist bankers an above-market rate of return just for parking their money with the Fed, so if they are going to loan any of that money out, they are going to command high premiums. But why loan it out at all, when you can starve the smaller banks to death, send them into bankruptcy and buy them up for pennies on the dollar, even though you are totally insolvent but for the fairytale financial statements made possible by continued government tolerance for mark-to-model valuations.

Incidentally, failures to deliver treasuries in the repo markets are at record levels because traders seeking to borrow treasuries worry that they might end up in a situation where they pay money to borrow treasuries that are not delivered on time, while the money they paid for those treasuries might never be returned because the counterparty might go under. Those lending treasuries are afraid to deliver because they might not ever get their treasuries back again if their counterparty goes under. All the insiders know that their financial institutions are insolvent, so is it any wonder that the treasury market would be virtually frozen but for the Fed’s intervention? Failures to deliver US treasuries now exceed well over a trillion dollars in value.

High risk of default and rapid monetizations that will lead to hyperinflation in the not-too-distant future, along with current real (as opposed to official) inflation rates that are around 9%, are a synergistic formula for much higher interest rates in the future. These rates will eventually move into double digits, and this is when the Much, Much Greater Depression will reach its nadir (lowest point) as the real estate markets collapse, real estate values plunge, interest rate swaps generate tens of trillions in losses for large Illuminist “legacy banks,” corporate profits turn into red ink on a global basis and world markets collapse.

The “legacy banks” and the Fed are slated for failure after the system is milked and they have acquired or bankrupted thousands of banks by starving them of credit or by acquiring them with taxpayer funds. They will then be bailed out and amalgamated into a super-entity that will itself be a cog in a new world system, which will combine the privileges, power and support of the BIS (Bank of International Settlements), IMF (International Monetary Fund) and the World Bank. They in turn will be supervised by the UN, which will be funded with a carbon tax as well as direct taxes levied on member nations. Along the way, a new world currency will be forged, and the dollar will be tossed. The new currency will purportedly be backed by gold, but this will be a farce just like our Fort Knox gold and the gold held by central banks, including the ECB. They have no intention of using their gold to back the new world currency, and it will be squirreled away as a failsafe while bank books continue to show it as an asset of the system.

All the central banks in the world probably have about 5,000 tons left out of the more than 30,000 tons they claim. By that time, China’s central bank will own as much gold as these other central banks have combined, or may simply end up owning what is left of the gold that remains with the other central banks. They will use this gold to set themselves up as having a large say in the world financial system and currency that is planned. But remember, the public in India has about 30,000 tons, and the Illuminists themselves, who rule the developed nations of Western Civilization, have tens of thousands of tons in their own private stashes which they have looted from their own central banks at fire-sale prices, or which they have outright stolen through war or theft.

So China really needs at least 10,000 tons just to stay in the game, as does Russia.

China will likely acquire the entire quantity of gold offered by the IMF for sale outside of the markets in the ongoing quest to diversify and become a dominant world power, so this IMF gold bologna is a non-issue and will have little impact on the price of gold, assuming that such sales are even approved by the US Congress, which is highly unlikely. As you can see, the quest to become a dominant player in the new world currency and financial system requires the acquisitions of tens of thousands of tons of gold, and that means gold is going on a moon-shot. Wait until the Illuminists themselves become gold bugs to keep as much out of the hands of China and Russia as possible. After all, the sales proceeds from the dollar-denominated paper assets that are sold behind everyone’s back in the Big Sting Two have to go somewhere, and a lot of that is going into gold, silver and their related shares.

Posted: May 2 2009

Source: The International Forecaster