Thursday, June 19, 2014

JIM RICKARDS PREDICTS THE DOLLAR TO “COLLAPSE BY HALF” IN RESPONSE TO NEW MIDDLE EAST WAR!

“Oil is stable.  What you’re seeing is the collapse of the dollar!  As oil goes from $100 to $200 a barrel, I don’t think that oil doubled, what I think is that the dollar collapses by half….The Fed wants a little inflation- they’re going to find they get alot more than a little.  This looks like the 70?s”  -Jim Rickards, on CNBC.
Full MUST WATCH interview is below: 











Enough Of These Keynesian Fools! The Fed’s GDP Hockey Stick Goes Limp Again

The Fed’s so-called DSGE (dynamic stochastic general equilibrium) model should be smashed into bits and dumped into the dustbin of history. In today’s release everything is the same—–above trend economic growth for years into the future accompanied by below target inflation, full-employment and sub-normal real interest rates as far as the eye can see.
Except…except for 2014 real GDP, which is already -2% in the hole after the impending further markdown of Q1 results. Accordingly, economic growth for 2014—-the year that “escape velocity” was a sure thing—has been marked down by nearly 25% since last quarters outlook, and at downwards of 2.5% is a pale comparison to the upwards of 4% projected as recently as Q4 2011.
The Fed is a dictatorship of dangerous Cool-Aid drinkers. To every question about obvious structural failures in the US economy such as the drastic rise long-term unemployment and labor force dropouts and the anemic level of business investment in future productivity and growth—which has been at deeply sub-historical levels since 2000—-Yellen had a ritualistic response: All the bad stuff is due to the fact that the cyclical path of the US economy has fallen short of the DSGE prediction for 5 years running, but all those failures will automatically fix themselves once the economy gets back on the Fed’s perpetually limp hockey stick!
Never has one person talked in so many circles in such a short period of time. In truth, the Fed’s new chair is an appallingly naïve and simple-minded paint-by-the-numbers Keynesian. She will lead the Fed right into the jaws of the next bubble smash-up, and as one wag put it, no one will even bother to leave the room.
In any event, the following chart posted on Zero Hedge says it all.

Is It 2003 All Over Again? U.S. Global Investors’ Frank Holmes Predicts a Resurgence of the Love Trade for Gold

by JT Long of The Gold Report (6/18/14)
Close your eyes. Imagine India growing and importing gold again freely. China and the U.S. investing in infrastructure. Europe stable. The Middle East conflict-free. What would that mean for commodities? In this interview with The Gold Report, U.S. Global Investors CEO Frank Holmes outlines the developments that could move us toward that vision and the impact that scenario could have on gold, diamonds and steel.

Related Content:
The Gold Report: You recently wrote an article called “It’s Morning in India” that marked the election of Narendra Modi’s pro-business government. How much of an impact can one man have on the demand for commodities?
Frank Holmes: At U.S. Global Investors, we believe that government policies are a precursor to change. That is why we focus on fiscal policies all over the world to understand the impact they will have on everything from interest rates to money supply. What makes Modi special is that he understands that job growth and creativity come from fiscal stimulus. Creating tax-free zones, breaking up monopolies and streamlining regulations and bureaucracy can unleash intellectual capital. Modi’s track record in the state of Gujarat illustrates his ability to produce significant growth. He is a no-nonsense, pro-business person.
TGR: Let’s look at what you have called the love trade. Its traditional seasonal impact on the gold market was quashed by taxation and import bans. How much of an effect could the pent-up demand have on the gold price if the government eliminates those disincentives?
FH: India is a big market and it can have a big impact. There is a high correlation of rising per-capita GDP in China and India and rising consumption of gold for gift giving. In the past three years, global GDP has shrunk from 5.5% to 3%. This year, it looks as if it is going to be back up to 3.5%. Growth and prosperity in America creates an economic sounding board that creates money around the world. Add to that the demand created by the religious holidays in the second half of the year—first Ramadan and then wedding and Diwali seasons, followed by Christmas and Chinese New Year—and it looks very positive.
Even JPMorgan Chase’s Global PMI, the Purchasing Managers’ Index is looking up. The forecast of the next six months of economic activity shows the 1-month above the 3-month average. When that happens, consumption usually increases significantly in all commodities.
TGR: Let’s quantify the term “significantly.” Are we talking about a 2% increase? A 10% increase? More?
FH: Well, that’s hard to say, but I have a suspicion that gold can easily jump 30%, up two standard deviations, because it’s been down two standard deviations. Meanwhile, gold stocks are cheaper today than they were during the crisis of 2008, relative to the price of gold. So if we have a 30% increase in the price of the gold over the next 12 months, the gold stocks could rally 60%. For that to happen, we would have to see peace and prosperity in China, India, Southeast Asia and the Middle East, because that really triggers the consumption of gold.
TGR: How do you determine what companies in your portfolio are poised to do well if the gold price increases?
FH: Quality of management is a key factor. We look for technical engineers and geologists, but also at whether leadership understands the capital markets and has relationships with newsletter writers, buy-side and sell-side analysts. Those companies that have those relationships when they come out with news will enjoy a better response in the capital markets. So the quality of senior management is very important.
Our investment philosophy is driven more by the quality of the company rather than by leverage to the gold price.
We love Virginia Mines Inc. (VGQ:TSX). It’s a high-quality, low-risk exploration and royalty company managed by André Gaumond, who has an incredible track record. He knows all the newsletter writers, he knows all of the sell-side and buy-side analysts, and the company owns a role in Goldcorp Inc.’s (G:TSX; GG:NYSE) high-grade Éléonore project, which he found and is slated to go into production in late 2014.
Another low-risk, high-grade gold producing company that we see as having significant upside is Klondex Mines Ltd. (KDX:TSX; KLNDF:OTCBB). At the beginning of the year, Klondex Mines completed what we think is a transformational transaction with the purchase of Midas mine and mill from Newmont Mining Corp. (NEM:NYSE). Management is highly respected. At one time, Franco-Nevada Corp. (FNV:TSX; FNV:NYSE)owned the Midas mine. Klondex Mines and Virginia Mines delivered 6% and 20% returns in 2013 when the Market Vectors Gold Miners Exchange-Traded Fund (GDX:NYSE) was down 60%. That is impressive.
TGR: What is the next catalyst for Klondex Mines?
FH: We see the value in the Midas project facilities. That’s the catalyst. Once you unleash that and the quality of management and its ability to communicate its future growth, it could have an impact.
Another high-grade name with strong performance is MAG Silver Corp. (MAG:TSX; MVG:NYSE), which has two projects in Mexico.
TGR: MAG Silver just released a new resource estimate for the Juanicipio mine. Did that meet your expectations?
FH: MAG’s 44% share is 71 million ounces grading 601 grams per ton silver. That makes MAG Silver stock very desirable right now. We think it could get taken over at some point.
Another company that we like is NGEx Resources Inc. (NGQ:TSX). It’s got a great promoter, Lucas Lundin as chairman, and it’s led by well-known CEO Wojtek Wodzicki. Los Helados, Filo del Sol and Josemaria are major copper-gold porphyry deposits between Chile and Argentina with tremendous upside. Lucas Lundin is not afraid of drilling up something and selling it. A lot of time management falls in love with the asset and the value never gets unlocked. We like the way NGEx’s management thinks.
TGR: All three of these stocks are up since the beginning of the year. Do you credit that to management?
FH: Absolutely. They are always communicating. We don’t have to hunt them down to find out about a press release or news. The top analysts and fund managers know what they are doing. That proactive attitude creates trust in a personal or a professional relationship.
TGR: What are some other performers in your portfolio?
FH: One thing that is very important for stability in a portfolio is the royalty companies. Sandstorm Gold Ltd. (SSL:TSX; SAND:NYSE.MKT), Franco-Nevada, Royal Gold Inc. (RGLD:NASDAQ; RGL:TSX), and Silver Wheaton Corp. (SLW:TSX; SLW:NYSE) are all up this year.
Royal Gold has been the big champ. Last year, Franco-Nevada was the leader. Silver Wheaton was able to borrow $1 billion ($1B) for five years at 1.6%. That is unbelievable! Why would you ever want to own Newmont Mining or Barrick Gold Corp. (ABX:TSX; ABX:NYSE), when you can own Franco-Nevada? It has 60% gross profit margins and a royalty on all those operations. You don’t have to worry about all the fiascos or leveraged balance sheets. Management owns a big portion of the company. Franco pays dividends on a regular basis. Just consider revenue per employee, which is $50 million ($50M). In most companies, $500,000 revenue per employee is good.
Today, royalty companies function like mining finance houses. That’s a great business model. That is why they are one of the core holdings for any portfolio.
TGR: Is this an important time for royalty companies because there is such a desperate need for capital?
FH: Capital markets are broken. Regulations are so excessive for junior mining companies that it is increasingly difficult to just walk in with a beautiful piece of property in Quebec and raise money. Therefore, private equity and royalty companies are very significant for junior mining companies right now.
We are seeing a shake-up. Weak properties and weak management are just not going to get funded. Great management and great properties can go to Franco-Nevada or Royal Gold or Silver Wheaton and really advance their projects.
TGR: Your Gold and Precious Metals Fund (USERX) did very well at the beginning of the year considering the market. You’re up 11.83% compared to the last 12 months when it was down 32%. Is that upswing a sustainable trend?
FH: It’s all about concentration. Alpha comes from two things: a) the ability to pick better companies; and b) overweight them relative to any index.
If an index is 5% Franco-Nevada and I have 15% for my portfolio, I’m three times overweight the index and that stock outperforms. That is how I’ve massively outperformed the index. Conversely, underperformance comes from overweighting in a very poor stock. Our alpha is coming from focusing on the companies that I mentioned, like MAG Silver, Virginia Mines, NGEx Resources, and balancing those volatile names with the royalty companies.
TGR: Does the same logic hold in other commodities?
FH: The other commodity we love is diamonds. We love Lucara Diamond Corp. (LUC:TSX.V), which is another Lucas Lundin company. For less than $50M, he got his money back in a year. It’s really simple math. We now have seven billion people on earth and if even 1% of those people experience a dramatic rise in per-capita GDP and they all buy luxury goods, that is a boon for companies like LVMH Moët Hennessy Louis Vuitton S.A. (LVMH:IT), which currently has a market cap bigger than Goldman Sachs Group Inc. We own Tiffany & Co. (TIF:DE) because when things start to get better, people want nice things.
Disruptive technologies are making millionaires and billionaires out of a concentrated percentage of the population like Dr. Dre and the five people behind WhatsApp.
TGR: Well, this isn’t as sexy, but what about nickel and steel?
FH: Nickel is much more of a straightforward supply-demand story. Nickel is used in alloying steel, including the steel that will be used in the $550B pipeline China is building to Russia. If there is a supply shortage out of South Africa and mines shut down in North America, the price could immediately go up. Copper levitated a couple of years back even though the economy had slowed because earthquakes and strikes impacted the supply. If we get any type of supply constraints, then prices could change quickly.
Right now, we have an oversupply of steel. The Chinese have been dumping steel on the world. But that pipeline agreement with Russia could be a signal that the country is embarking on an infrastructure boom that will absorb a lot of the steel. Combined with Modi’s infrastructure ambitions in India, that could mean a lot more demand for steel and copper.
TGR: Are you predicting the same significant impact as in gold, a couple standard deviations?
FH: I think we have the potential for one of those great global rallies we witnessed in 2003, 2004 and 2005. If China and India start building meaningful projects for their people and we get a bottom in Europe, with America on an upswing, I think that we could see a global surge. It’s not going to be as inflated as it was in 2003 because the housing component is not going to be as leveraged. Housing has the highest multiplying effect for money because so many people touch each dollar to create a house. Therefore, I don’t think we’re going to get close to the surge we had 10 years ago, but I do think we can get at least three-quarters of that.
TGR: Your Holmes Macro Trends Fund (MEGAX) is a diverse basket of industrial, energy, technology, healthcare, consumer product and financial stocks that are impacted by the macro-issues you just outlined. What criteria do you use for building that portfolio?
FH: We look at companies that are actively growing their revenue more than 10%, generating bottom line up to 20% return on their equity, and demonstrating 20% growth in earnings.
As John Derrick described in his Periodic Table of Sector Returns, we can learn a lot by examining movement in the top sectors. This is an amazing indicator. We track quarterly how many S&P 1500 companies across all sectors qualify for this beauty contest. This past March the number went from 160 names to 180 names even though GDP was down in America. That shows wonderful, broad-based economic growth. Back in the peak of 2006, it was over 200 names, then it fell down to under 100 names. So it is going in the right direction.
Another positive is that industrials are strong, and that is usually highly correlated to the consumption of commodities and good for per-capita GDP because wages are typically more than $15/hour in that sector.
TGR: More than half of the Macro Trends Fund is composed of large-cap, over $10B companies. Are you worried about a bubble in the large indexes?
FH: The word bubble has been abused. If you research the causes of a true bubble, it’s usually excessive leverage, borrowing. The great crash of 1987 when investors lost 40% of their wealth in two days was predominantly because the S&P futures market was leveraged 10:1. In the crash of 2008, we had a housing market leveraged 90:1. Today, there is some concern about leveraged buyouts, but governments are going to have to keep interest rates negative or extremely low to counter regulatory creep and keep the economy moving.
TGR: So you think today’s stock prices correlate to the true value in the companies?
FH: Sure they do. Look at dividend yields. A 10-year government bond is 2.5%, and you can buy some of these big-cap stocks with a dividend yield greater than 10 years out. We don’t know who will be president 10 years from now, but we do know we will still be using Procter & Gamble’s products and drinking Coca-Cola.
Plus, fewer companies are issuing stock options. Instead they are giving executives stock grants over five years so there’s a real aligned interest for senior management in these companies to buy back their stock, and increase their dividends against their cash flow. Look at Apple Inc. (AAPL:NASDAQ ). It announced a 20% buyback; revenue per share is jumping 20%. That’s profound. There are very few IPOs relative to companies buying back their stock and increasing their dividend. That means the stock market is still very attractive.
TGR: Thank you for your time, Frank.
Frank Holmes is CEO and chief investment officer at U.S. Global Investors Inc., which manages a diversified family of mutual funds and hedge funds specializing in natural resources, emerging markets and infrastructure. Holmes purchased a controlling interest in U.S. Global Investors in 1989 and became the firm’s chief investment officer in 1999. Under his guidance, the company’s funds have received numerous awards and honors including more than two dozen Lipper Fund Awards and certificates. In 2006, Holmes was selected mining fund manager of the year by the Mining Journal. He is also the co-author of “The Goldwatcher: Demystifying Gold Investing.” He is a member of the President’s Circle and on the investment committee of the International Crisis Group, which works to resolve global conflict, and is an adviser to the William J. Clinton Foundation on sustainable development in nations with resource-based economies. Holmes is a much sought-after keynote speaker at national and international investment conferences. He is also a regular commentator on the financial television networks CNBC, Bloomberg and Fox Business, and has been profiled by Fortune, Barron’s, The Financial Times and other publications.
Want to read more Gold Report interviews like this? Sign up for our free e-newsletter, and you’ll learn when new articles have been published. To see recent interviews with industry analysts and commentators, visit our Streetwise Interviews page.
DISCLOSURE:
1) JT Long conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and provides services to Streetwise Reports as an employee. She owns, or her family owns, shares of the following companies mentioned in this interview: None.
2) The following companies mentioned in the interview are sponsors of The Gold Report: Klondex Mines Ltd., Virginia Mines Inc. and MAG Silver Corp. Goldcorp Inc. and Franco-Nevada Corp. are not associated with Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services or as sponsorship payment.
3) Frank Holmes: I own, or my family owns, shares of the following companies mentioned in this interview: None. I personally am, or my family is, paid by the following companies mentioned in this interview: None. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I had the opportunity to review the interview for accuracy as of the date of the interview and am responsible for the content of the interview.
4) The following securities mentioned were held by the Global Resources Fund, Gold and Precious Metals Fund and World Precious Minerals Fund as of June 16, 2014: Franco-Nevada Corp., Goldcorp Inc., Klondex Mines Ltd., Lucara Diamond Corp., MAG Silver Corp., NGEx Resources Inc., Royal Gold Inc., Silver Wheaton Corp. and Virginia Mines Inc.
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End Of USA Dominance – Nails In The Dollar Standard’s Coffin


hiddensecretsofmoney.com/…For more than four years now Michael Maloney has been demonstrating to audiences around the world that every 30-40 years the world has an entirely new global monetary system, that the current monetary system (the U.S. dollar standard) is aging and becoming unstable, and, just like the previous monetary systems, will soon implode.
On June 1st, 2014, at the Cambridge House Investment Conference in Vancouver, Canada, he updated his “Death of the Dollar” presentation and showed how the “Nails in the Coffin of the Dollar Standard” are now coming faster and are more furious than ever before.  He believes that there will be a global currency crisis before the end of this decade and that the days of the dollar standard are numbered.
In a second presentation on the same day he makes the most convincing argument yet that there is a massive deflation coming, that there will probably be an overnight devaluation of the dollar and huge overnight revaluation of gold, and, though it will be painful for most, it is the greatest opportunity in history for those who are prepared.
Mike Maloney, author of the best selling book on investing in precious metals “Guide to Investing In Gold and Silver” and the host of the series “Hidden Secrets of Money”.

It's Over

By: Chris Tell at: http://capitalistexploits.at/

At a "pitch fest" a few nights ago, while sitting listening to the companies present their stories, and questioning the founders, one particular company struck me as a glaring outcast.
I'll tell you why they were an outcast, but first...
After just a few pointed questions I discovered that this company was struggling to achieve revenue growth, and they were a long ways off from profitability. Here are a couple of reasons why:
  1. High staff count all located in the developed world.
  2. Huge OPEX relative to many of the companies which operate in their space, which was almost entirely driven by point 1 above.
Later the same day I called my insurance company and got through to a call desk. I spoke with "Jacindra". After prying a bit I find she's in Manila. The reason the company I mentioned above is struggling to compete and become profitable is because they are providing a service not distinctly different than their competitors, yet they are paying multiples for things like labor. They are shouting from the rooftops that they're "local", but you know what, that's not scalable, and further more I don't care.
Do I care if Joey, a "local" in some developed world country loses his job to Jacindra in Manila? No. I congratulate Jacindra on dragging herself out of poverty with the aid of technology, and I thank her for the fact that the product I'm receiving is likely cheaper than it would otherwise be.
I hope "Joey" adapts to this change and finds a way to produce more value than he's currently worth, possibly in a completely different field. Change, especially if you're on the rough end of it is tough, but remember we'd all be still sitting in caves if it weren't for innovation and technological change.
General Electric, Caterpillar, Microsoft, Wal-Mart, Chevron, Cisco, Intel, Stanley Works, Merck, United Technologies, and Oracle cut their workforces by 2.9 million people over the last decade while hiring 2.4 million people overseas.
I see it every day... people losing jobs, having to retrain, change strategies and find ways to create value. "Cubicle jobs" are over. Sure there are still large swathes of "cubicle dwellers", but it's over, done, finished... I'm telling you.
Every day more and more people realise it. It's unfortunate for those who refuse to acknowledge it, even though its been staring them in the face for over a decade they've somehow managed to remain blind to it.
Manufacturing Payrolls
I've had angry people pop out of the woodwork when I've written about why education is broken. I suggested that the large educational institutions revenue models are fatally flawed and will see a sea change in the coming years, causing many in the industry to be forced to adjust.
I can understand the anger. Nasty surprises threatening the status-quo always get people angry when they're benefiting from the setup.
If you're sitting in a job which can be outsourced your clock is ticking. First cheaper labour, then better technology together with cheap labour, and shortly robots. You will be replaced, it's just a matter of time. This is a good thing.
Don't cling to the past, or the present too hard. Things you cling to tend to disappoint. The world is dynamic not linear, yet humans love to think in a linear fashion. This is how bubbles are created. This is how WhatsApp sells for more than the entire market cap of one of the world's fastest growing economies. Humans love certainty and certainty only exists in a linear framework in textbooks, it never exists in nature and it never exists in economics for long.
You've probably read about the massive protests across major EU cities by local taxi drivers. Why are they so angry? Because their ability to charge hapless pedestrians 2 blocks for $10 is coming to an end. GOOD! Once again an inferior product or service is being eroded by technology. Uber is single-handedly destroying them by providing greater efficiency and productivity at a lower cost.
Regulating and legislating who can give me a ride and act as a taxi impresses me as ludicrous, but that's the way much of the world operates when Government gets involved. It destroys entrepreneurship, it destroys productivity and as a result it does the very opposite of its stated purpose. Ultimately it causes a build up of waste and excess which would not exist without it.
When Mark and I were in Mongolia a couple of years ago we noticed quickly that every vehicle was a taxi. If you stood on the road and held out your hand someone would stop. Why? Because they can make a few bucks by picking up a "fare". Regular folks, on their way wherever. Why not? All Uber has done is to make that exact premise more efficient and add a little "flare" to it.
Luddits
This is an illustration from an old newspaper. Those are British weavers destroying textile machines in the early nineteenth century. Like the taxi drivers of today, and the cubicle workers, they were angry at technology. Should government have legislated against textile machines so that today we would still be struggling to find decent clothing? Think of the colossal waste of resources, of all the men and women who would be weaving clothing for the world's population, of the poor quality fabrics and massive losses in efficiency.
I humbly suggest their time would have been better spent figuring out how to leverage the technology to provide a better service or product. The same people exist today. Humans don't change. Circumstances change, technology changes but human nature never changes.

Socialists vs Capitalists
I previously wrote an article about these two distinctly different mindsets, in which I said:
The first is a group who believe that the world, its peoples, resources, skills and wealth are one giant pie. They essentially believe that individuals don’t have a right to their own bodies, efforts and thoughts. In their vision the pie does NOT increase or decrease in size, but what happens to the pie is that the slices get shifted around between various groups of people within the world. Their major concern is with how much of the pie they personally get relative to others. The aggregate amount is not as important as the relative amount.

What is preferable for them is getting less pie, provided others are getting twice as little. They will opt for this rather than receiving twice as much, where others are receiving four times as much. They couch this view of the world, and distribution of aforementioned skills, wealth and resources etcetera in platitudes such as “equality”, “fairness” and “justice”.

This group of people will typically support “free healthcare”, “free education” and any other “freebies” that they will not directly have to pay for. They will be ardent supporters of bigger, more intrusive government, as this is the only avenue they see available for the execution of their perfect world. Articulating it as such would be difficult for many of them, as it exposes their view of the world as one completely lacking in freedom of the individual.

The second group of people realizes that there is an existing pie, but are not overly concerned with its size or distribution, since their thoughts typically revolve around building their own pie and adding to the size of the existing pie. They don’t see the pie as a stagnant concept, but rather something that they themselves can participate in forming and shaping.

This second group believes they have the right to their own bodies, efforts and thoughts. They accept that there are others in the world that will have a greater slice of pie than they do, but since they obtain their value and self-worth from building the pie, this concerns them little. They understand that the journey and not the destination are what matters.

Since they have courage and a belief in their own abilities they find the idea of relying on others to support them through “free” anything to be immoral, and although not all will articulate it, they are distrustful of anyone purporting to “help” them, especially when it comes at no cost.  They choose to slog their way through the world on their own merits, and give back by creating wealth and opportunity for themselves and others.
The robots are coming... invest in what's coming tomorrow, because it's likely better than any of us can imagine.
- Chris

"Do what you can do best and outsource the rest." - Tom Peters

Detroit moves to hybrid pension plan for city employees

Detroit — City employees will see deductions in their paychecks beginning next month as Detroit moves to implement a new hybrid pension plan, the emergency manager’s office said Wednesday.
The new pension formulas will go into effect July 1 for all active and new employees under the General Retirement System and Police and Fire Retirement System. The move is designed to strengthen the two pension funds while maintaining a defined benefit retirement program, Kevyn Orr said in a statement.
As part of the pension changes, which were negotiated with the Official Committee for Retirees of the City of Detroit and public employee unions, current employees who participate in the general pension system will contribute 4 percent of their weekly pre-tax base salary, and police and fire employees will contribute 6 percent toward the cost of benefits payable under their respective hybrid pension plans. Police and fire members hired after June 30 will contribute 8 percent, the city said.
In addition, the city will contribute a match amount to the respective new funds for each employee who participates. Deductions will be seen in employee paychecks beginning July 14.
Some employees whose individual bargaining units have ratified new collective bargaining agreements could see their pension deductions offset by salary increases intended to incrementally return employees to 2010 pay levels over the next four years, Orr added.
“The city and its labor partners have come up with what we think is the best option to strengthen employee pensions so we can continue to meet future obligations in a financially responsible and sustainable manner,” Orr said in a statement. “This new pension plan is the result of months of intense negotiation between the city, its unions and its retirees.”
“The city’s intention all along was to create a sustainable retirement plan for its employees that is fiscally sound and continues to meet their needs,” he added.
Along with the establishment of the new pension plan formulas, benefit accruals under each fund’s current benefit formulas will be frozen on June 30 and closed to new employees. All current and future employees will participate in the new hybrid plans beginning July 1.
The city will hold a public hearing at 10 a.m. Tuesday in the 13th floor auditorium at City Hall regarding the changes.
Active city employees who participate in the current plans will receive the benefits they have earned through June 30, plus an additional benefit under the new hybrid plan formula, as long as they satisfy vesting requirements, officials said.
Employees who are vested in their benefits under frozen general or police and fire fund plans as of June 30, 2014, or who work with the city long enough to become vested in those benefits in the future, will receive their accrued benefits earned through June 30, when they would have been eligible to receive those benefits if they had not been frozen.

How to Survive Skyrocketing Meat Prices (Without Becoming a Vegetarian)

The headline on Drudge Report caught my attention yesterday, In large font, it screamed “Prices for Meat, Poultry, Fish and Eggs are at an All-Time High.”
To those of us who have been watching the alternative news, this is no surprise. Mac Slavo of SHTFplan wrote about it HERE.  Lizzie Bennett of Underground Medic warned us HERE.  Michael Snyder of The Economic Collapse Blog and The End of the American Dream has been shouting this from the rooftops for more than a year – HERE and HERE are two recent examples. Between the drought in California, the virus that killed off a bunch of baby pigs, and overall inflation because of an increase in fuel prices, every bite you put in your mouth is costing more this year, and those prices will continue to rise.
Does this mean that you have to become a vegetarian? Does it mean that you have to eschew healthy hormone-free meats and go with the toxic grocery store offerings?
Not at all.
My last trip to the grocery store here in the Pacific Northwestern US was absolutely appalling. I vowed to use a combination of strategies to help our meat purchases go further.

Buy in bulk locally

The absolute best way to buy meat is to purchase in bulk and to do so locally. We purchase direct from a local farmer who field-raises his animals and doesn’t use hormones and antibiotics.  You can buy a quarter or a half of a pig or cow, and you’ll pay on average a much lower price than you would if you bought the meat packaged separately over the course of the season. As well, you are locking in your meat price by purchasing it all at once. This way, you won’t be strongly  affected by the meat inflation until next season.
Here are a few tips for bulk purchases of meat
  • Check out the farm from which the meat originates. You want animals that were not raised in cramped factory farmed conditions, not fed GMO feed, and not injected with growth hormones and antibiotics. If you are making a purchase like this go for the best quality you can find.
  • If that is more meat than your family can use, or more money than you can spend right now, consider going in with another family and splitting the purchase.
  • You need a deep freezer in order to make the most of such a large purchase.  
  • I also like to can meat so that I am not as dependent on the electrical grid.  Look into canning entire roasts, meatballs, or chili.
  • Have the poorer cuts turned into stew meat or ground meat.
  • Slow cooking a lower quality cut can turn something tough into something that melts in your mouth.
  • Learn more about buying meat free of hormones and antibiotics HERE.

Eat leftovers

Often when you purchase meat in bulk, you end up cooking large portions. You probably won’t open a Styrofoam tray of chicken breasts, but instead you’ll purchase a whole chicken.  You will be more likely to cook a stew or a roast. Have a plan for what you can do with those leftovers to extend them through another meal. Here are a few quick ideas:
  • Make gravy – if you have a serving a meat too small to go around for all of your family members, consider making a gravy and serving it over mashed potatoes. Add some onion and mushrooms to the gravy to extend it even further.
  • Make a soup or stew – this is another way to extend a serving that isn’t quite big enough to go around
  • Mix it with beans and add Mexican seasoning to make burritos or to serve over rice.
  • When you make a large roast, thinly slice the meat for sandwiches and salads throughout the work and school week.
  • Cover leftover stew with pie crust or biscuit dough for a delicious potpie
You can find more ideas for repurposing leftovers HERE.

Don’t waste anything

Use up the things that most people throw away.  When preparing the meat, if you are cutting away some fat or bone, place it in a bowl and put it in the freezer. When you have enough like scraps of meat, it’s time to make broth from it.  You can make hearty broth from ham, turkey, chicken, beef, or pork – virtually any kind of meat.  Use the inedible parts and cook it down for hours to get a rich and delicious broth. You can then use this broth as a base for soup or to cook your rice in to add a hit of nutrition.
Here are directions on how to make and can poultry broth and ham broth.
Do you have such a tiny amount of leftovers that it won’t equal a full serving? Start a container in your freezer for those leftovers and create “leftover soup”.  Sometimes it’s fantastic, sometimes it isn’t so great, but those odds and ends can combine to make meals that I consider to be basically “freebies.”  We always have a large tupperware container in the freezer that contains little bits of vegetables or meat. Add a jar of homemade broth and a handful of rice, barley or pasta, and you’ve created “leftover soup.” It will be different every single time, based on your family’s leftovers.

Hunt and fish

This answer isn’t for everyone. Some folks prefer to forget that the meat on the styrofoam trays at the grocery store didn’t originate on those trays. Other’s have gotten locked in to a more narrow definition of “meat” , believing that the options are fish, pork, beef, and chicken.  However, if you aren’t bothered by the concept of hunting, there is an abundance of meat walking, swimming, and flying around.
You don’t have to hunt, yourself.  I’m fortunate to have some friends and neighbors who hunt. In exchange for some of the bounty, I’ve bartered my skills at canning things like venison chili or moose meatballs in spaghetti sauce.
If you fish, that can put an instant meal on the table.  Learning to quickly and efficiently clean fish is a great skill and can gently prepare you for butchering other types of meat.
Perhaps with the sharp uptick in meat prices, it’s time to brush up on these skills and learn to harvest what is naturally abundant in your area.

Any suggestions?

How do you combat the outrageous meat prices?  Share your ideas in the comments section below.
About the author:
Please feel free to share any information from this site in part or in full, giving credit to the author and including a link to this website and the following bio.
Daisy Luther is a freelance writer and editor.  Her website, The Organic Prepper, offers information on healthy prepping, including premium nutritional choices, general wellness and non-tech solutions. You can follow Daisy on Facebook and Twitter, and you can email her at daisy@theorganicprepper.ca

JIM GRANT: “EVERY PRICE IS EXISTING IN THE FED’S WORLD OF SUPPRESSED OR MANIPULATED INTEREST RATES.”

CNBC, Released on 6/17/14
“Every price is existing in the Fed’s world of suppressed or manipulated interest rates.”
“You can’t just lie once. You can’t just intervene once. You must keep intervening to negate or counteract or mollify the effect of earlier interventions,” he said.












Jim Willie: "The Dollar is Toxic"


It’s a New American Dream and it’s only for the Super Rich

So you haven’t read Thomas Piketty’s “Capital in the Twenty-First Century?” The new bible on the history and future of global economic growth? Well, you’re in good company. Neither did Alan Greenspan, former Fed chairman, before his recent speech on the same subject, “worldwide prospects for economic growth.”
Worse, Greenspan was delivering his speech before 170 members of the eliteCouncil on Foreign Relations, whose 4,700 members include power players like Colin Powell, Madeleine Albright, Robert Rubin, Tom Brokaw and David Rockefeller.
And it gets even more bizarre: Not only haven’t most power players in politics and business, liberal or conservative, read it, they probably never will read the No. 1 international bestseller that’s igniting a revolution in economic thought.
So why aren’t America’s leaders reading it? Because they don’t have to read it. They believe they instinctively “know” its message. It’s that obvious. That Piketty was simply putting a solid statistical research foundation under a New American Dream for the Super Rich of the 21st century.
To fully understand, here’s some background on Greenspan’s speech, which was delivered two months after “Capital’s” early March pub date. He had lots of time to read it. Why didn’t he?
Why won’t American leaders read the most important economic book of the century? Why? Because Piketty’s bottom line is obvious: “When the rate of return on capital exceeds the rate of growth of output and income, as it did in the nineteenth century and seems quite likely to do again in the twenty-first, capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine the meritocratic values on which democratic societies are based.” In short, the original American Dream is dead, the new one is only for the Super Rich.
Yes, instinctively our leaders understand Piketty’s bottom line. They already have their own preconceived theories of economic growth and inequality in the 21st century. They already have hard convictions on why, by 2100, the Super Rich will be richer and the poor poorer. So why waste time reading a boring 685-page book of facts? It won’t change their minds.
Nothing’s new from this behavioral psychology principle: Remember Greenspan’s congressional testimony a few years after the 2008 crash. After 18 years as Fed chair he finally admitted that trickle-down free-market economics failed America: “I made a mistake,” there was “a flaw in the model. Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief,” he told Congress. Unregulated markets were his mantra for decades. But then “the whole intellectual edifice, however, collapsed.” We’re still making the same mistake.

Why read Piketty? Your mind’s made up

Here’s how venture capitalist Michael Pocalyk explained this psychological phenomenon later in a newsletter for authors, the Algonquin Redux, under a simple headline: “Nobody Actually Reads Piketty.” Listen to Pocalyk:
“I’m a life member of the storied Council on Foreign Relations. … Greenspan was our luncheon speaker … was discussing worldwide prospects for economic growth.” After the host, Diane Farrell, global head of McKinsey’s Center for Government, and Greenspan finished, “the audience of CFR members got to ask questions.”
Sitting up front was Mitzi Wertheim, head of special projects at the Naval Postgraduate School. Her “hand shot up. She clearly wanted to ask the chairman something pressing. Diana Farrell nodded to her.” Wertheim’s question was about Piketty’s book, “which is of course the ‘it’ book of the moment, especially among political and economic liberals.”
The question: “Had Greenspan read it? What did he think?” Things suddenly got dicey. Diana Farrell interrupted: “Wait a second, before you answer, let me ask all of you . . . How many of you have read it? Show of hands, please.” Ooops.
Pocalyk presses you to “think about this for a moment. 170 Washington-based members of the Council on Foreign Relations and a major complement of the U.S. and international press corps — economic reporters — are in the room. Listening to Alan Greenspan. Arguably the most august assembly of economic policy elites that it is possible to assemble in America.”
Pocalyk “looked around and counted four hands!” Just four out of 170. Wertheim’s “was one of them. Mine was not. Neither was Alan Greenspan’s.”
Next, Farrell’s interrogation dug deeper: “‘OK. How many of you have read some review or commentary about it?’ You guessed right. Every hand in the room went up.”
Now here’s the lesson Pocalyk got out of this show-of-hands expose: “There have always been books whose impact and significance — particularly in high-literary and politico-cultural spheres of influence — are about their act of publication rather than their content because nobody reads them. We’ve all suspected that this is the case. Rarely do we get real empirical proof, much as I disagree with him.”
So America’s finally got the empirical proof. But so what? If we all already know it. Conservative and liberal, Republican and Democrat, everybody’s brain already knows instinctively how Piketty clearly distilled the New American Dream from a 685-page book to several words: By 2100, the Super Rich will be richer, the poor will be poorer. Obvious, right? So why read a long, boring book of facts, figures, charts and research about something you already know … or at least have ironclad convictions about it.

Debate’s settled. No reading. Find more opportunities. Get Super Rich

Yes, forget Piketty: Here are the real facts you need to know about a world mass-producing billionaires. Forbes, Bloomberg and CNBC all report an explosion of billionaires. From 322 in 2000 to 1,847 in 2014. China alone now has 358 billionaires. Africa has 29, added nine just last year. What’s more, the income of the world’s 85 richest billionaires is greater than the 3.5 billion in the bottom half. Plus Credit Suisse Bank predicts 11 trillionaire families in the world by 2100.
In “China Minting Millionaires in Global Wealth Surge,” Bloomberg BusinessWeek’s Dexter Roberts reports: “The number of millionaire families around the world reached 16.3 million last year, up from 13.7 million the year before.” The magazine’s Max Abelson also adds that individuals “worth $100 million or more has jumped 62% since 2003, to 37,104. Data confirming the Piketty trend, that the value of global private wealth grew far faster than global economic output, up 14.6% to $152 trillion, compared with an 8.6% increase in 2012,” and “much of the new money originated in the Asia-Pacific region.”
Forget politics. Irrelevant. The race to get super-richer is on, says Huffington Post’s Mark Gongloff in “Big Bank Explains To Rich People How To Profit Off Inequality.” He focuses on a Merrill-Lynch Hong Kong report: “On Wall Street, the debate about wealth inequality is all but over, except for finding ways to make tons of money from it. The rich are going to keep getting richer all over the world,” just as Piketty has been predicting.
Gongloff next makes a fascinating cultural observation: “Reminiscent of the ‘debate’ over climate change: While partisans might still haggle over its importance and/or existence, companies and governments with lives and treasure at stake are already adjusting to its reality. So too with rising wealth and income inequality,” especially in resource-rich nations.
In fact, Merrill Lynch, like Credit Suisse and other global banks, has been predicting Piketty-style inequality for over a decade in “economies where economic growth is powered by and largely consumed by the wealthy few …. While this might sound like a nightmare world,” especially for the middle class and poor, “it is also a chance to make a bunch of money, for those (mostly rich people) with the means to invest in companies that most profit from the wealthy elite. This includes luxury-goods makers, money managers and private banks.”

Surrender America, the Super Rich are winning … jump on the bandwagon

Face facts, this New American Dream is raging. Surrender to the inevitability of the Piketty Principle, that the Super Rich will get vastly richer, own more and more of the world. They won. They rule America. Rule the world. Have redefined the American Dream as the New Global Super Rich Dream. The old American Dream inspired all Americans, everyone in the world. But no more. The new dream is about a rapidly emerging world where more is never enough, ruled by the wealthiest one percent.
But at what cost? For in this dream world of our future … we are addicted to wealth … we have lost our moral compass … our inner spirit, our collective conscience … America has lost its soul.
Paul B. Farrell is a MarketWatch columnist based in San Luis Obispo, Calif. Follow him on Twitter @MKTWFarrell.

For third straight month, China cuts US debt holdings

China cut its holdings of United States government debt in April for the third straight month, which may reflect a continuing move from US assets, according to an analyst.
China, the largest foreign holder of US Treasuries, held $1.26 trillion in US debt as of April, down $8.9 billion from the previous month and below the $1.27 trillion mark for the first time since August 2013, the US Treasury Department said Monday in a monthly report. China's holdings hit a high of $1.317 triillion in November.
Kent Troutman, a research analyst at the Washington-based Peterson Institute for International Economics (PIIE), said the decreases each month could be due to benign shifts in the portfolio.
"April is the first month where there is a larger decrease, but it is still small. What is worth noting, however, is that, even if China's holdings of US Treasuries are flat, its share of overall foreign exchange reserves is declining," Troutman wrote Monday in an email to China Daily.
"What we've seen in the past four months, if we accept that the data accurately reflects China's true holdings of US assets, is the continuation of a shift that began in 2010 of diversifying their portfolio away from US assets," he said.
Japan remained the second-largest US creditor in April, increasing its debt securities by $9.5 billion to $1.21 trillion.
Foreign demand for US assets strengthened as net foreign purchases of long-term securities totaled $24.2 billion in April, compared to purchases of $4 billion in March, the data showed.
The Treasury's monthly release of its Treasury International Capital (TIC) data details foreign ownership of US securities. For transactions and banking data, there is a 1.5 month lag between the release and the as-of date.
Marc Chandler, Global Head of Markets Strategy at Brown Brothers Harriman & Co, a New York-based investment bank and securities firm, said that though there are limits on the accuracy of TIC data, it still provides an "authoritative source" on the domestic and foreign holdings of US securities.
"Some people want to initiate policy based on the TIC data, and maybe you don't want to bet the farm on it," Chandler said on Monday in an interview with China Daily. "There are definitely limits on the framework and methodology, but it's the best source we have."
Chandler, who also serves as a contributing writer for Seeking Alpha, a leading online investment research platform, said he does not put too much stock in April's "minor" decline in China's holdings of US securities because there's not enough information to contextualize the drop.
"It is interesting to note that China is still the world's largest holder of Treasury bonds," he said. "And despite the lowered Chinese holdings, it did not prevent the US bond market from continuing to rally."
"Right now, Chinese banks are some of the biggest in the world, so maybe they'd want to move away from relying on foreign banks for their commercial transactions," Chandler said.
The last decline of China's Treasury holdings that exceeded three months came in the final five months of 2011, according to a June 16 report by Bloomberg News.
Gennadiy Goldberg, a US strategist with TD Securities USA LLC, said: "On a month-to-month basis, it's very difficult to really get any kind of value out of the numbers themselves. There will be months when China buys $30 billion in treasuries and there will be periods when it really continues to gradually shed. As we get further into liberalization of the currency, as they allow the yuan to strengthen further, it will be very interesting to see what happens."

Detroit city worker union pushes bankruptcy restructuring plan

The American Federation of State, County and Municipal Employees (AFSCME) union has reached a deal with Detroit’s emergency manager for new labor agreements covering several city departments.
The deal, reached on June 12, is based on five-year agreement AFSCME and 13 other city worker unions signed in late April, which imposes deep concessions on 3,500 out of the city’s 9,300 public employees. AFSCME, which is the city’s largest union, has now reached agreements for virtually all of its members.
Details of the agreement are sketchy and being concealed until after the ratification vote, which is to be held sometime before June 30. However, the outlines are clear. City workers, who took a wage freeze in 2010 and a pay cut of 10 percent and deep benefit cuts in 2012, will suffer a further erosion in living standards. The contract reached in April includes a wage hike of only six percent spread over five years, well below the rate of inflation.
In addition, the employer-paid pensions will be replaced with 401(K) defined contribution plans, health care benefits will be reduced and work rules, seniority rights and other job protections eliminated. The deal will also pave the way for unpaid furlough days and another reduction in the city workforce, which has been cut by 25 percent over the last four years alone.
According to the bankruptcy court statement announcing the agreement, the deal must be approved by state officials before it is incorporated into the plan of adjustment. Workers are being kept in the dark about the deal and the vote. “They haven’t given us information on when we’re supposed to ratify or anything. It’s a bunch of crap,” said Raymond, a worker at the Detroit Water and Sewerage Department, which faces the elimination of nearly half of its workforce and possible privatization.
“They owe us 10 percent from what they took from us. Everything they’re doing is wrong. Pensions are being cut, everything. They give us $200 million then turn back around and take $290 million from us. That’s not going to help us.
“This grand bargain is a grand bull crap,” said Raymond, referring to the scheme crafted by the bankruptcy court with wealthy foundations, the state government and the unions to allegedly protect pensioners and the collection of the Detroit Institute of Arts from creditors. “It’s a lot of tricky stuff they’re playing. And the workers are losing everything.”
The so-called grand bargain is in fact a line-up of anti-working class forces, which will all agree that workers and the people of Detroit in general must pay for the crisis they did not cause. In exchange for a $815 million “rescue package” of private and public funding, retirees and active workers are told they must vote “yes” on Orr’s bankruptcy restructuring plan.
The AFSCME agreement follows similar deals reached by union-affiliated retiree associations, which sanctions cuts in pensions—whose “impairment” has long been prohibited by the Michigan state constitution—along with deep reductions in health care benefits for 23,500 retirees and dependents.
General retirees will see their pension checks—which average only $19,000 a year—cut by 4.5 percent and will also lose their cost of living adjustments. The city will also “claw back” another 15.5 percent from retirees who were supposedly paid “excessive interest payments” from an annual annuity savings fund. If workers vote ‘no’ on the plan Orr has threatened to impose far deeper cuts.
The unions have dropped their phony opposition to the bankruptcy and are echoing the emergency manager’s threats. In the statement announcing AFSCME contract deals, the bankruptcy court wrote:
“In separate voting on the City’s bankruptcy Plan of Adjustment, AFSCME leaders are urging all active and retired city employees to vote ‘yes’ to approve the Plan. The latest agreement covering units not subject to the city-wide master agreement, and resolution of matters related to the state contribution agreement, is why AFSCME Council 25 urges all current and former city employees to vote ‘yes’ on the Plan and return their ballots as quickly as possible.”
The statement quoted AFSCME Council 25 President Al Garrett, who said, “We remain severely concerned with the way this bankruptcy has been handled from its inception. However, the agreements we have achieved are, in our view, the best path forward for city employees and retirees. They simply cannot risk the further serious reductions in pension, pay and job security if the Plan, and our collective bargaining agreements, are not approved.”
Over the last year, union officials have periodically postured as opponents of the bankruptcy. This never had anything to do with opposing attacks on workers, which AFSCME and other unions have long supported. Instead, the union executives were upset that Orr was suspending “collective bargaining” and was prepared to circumvent the unions altogether.
In the end, the bankruptcy judge, well aware of the deep popular opposition opted to use the services of the unions and secure the well-paid positions of Garrett and the other upper middle class businessmen who run the unions. In exchange for union support for Orr’s restructuring plan and dropping lawsuits, the unions were given control of a half-billion dollar retiree health care slush fund and have retained some level of influence over the multi-billion-dollar pension investment funds.
“Collective bargaining,” from the standpoint of the interests of workers, has been rendered meaningless. Under the terms of the state’s antidemocratic emergency manager law, the city reserves the right to tear up labor agreements it deems financially unsound. These powers will continue under a permanent financial oversight board, which is being established as a condition for the state government’s contribution to the grand bargain.
With widespread opposition to the plan of adjustment expressed at a series of meetings called by retiree associations, Orr, the unions, the media and state and local politicians are ramping up pressure for workers to vote for the plan. Ballots sent out to 32,000 active and retired workers are due by July 11.
The entire vote is a sham aimed at giving the process a democratic veneer. Orr has the power to redraft the restructuring plan whether or not workers vote for it. And if it is rejected, the bankruptcy judge can impose this deal or a worse one unilaterally. Underscoring the bogus character of the vote, spokesmen from the union-affiliated General Retiree System have told workers they can get another ballot from the city in order to change their original vote.
Rhodes recently pushed back the start of his confirmation hearing on the plan of adjustment to August 14.
While the plan will gut pensions and other benefits, federal mediators said this week they had reached an agreement with big investors and municipal bond insurers that recognizes the “unique” status of limited tax general obligation bonds. Under the deal, the financial investment houses will be covered for 74 percent of their bond holdings—almost five times the amount originally proposed in the plan of adjustment—and almost 10 percent higher than the average of 65 percent on defaulted bonds from 1970 to 2012, according to Moody’s Investors Service data.
The outcome should renew the view of general obligations as sacrosanct, John Dillon at Morgan Stanley Wealth Management told Bloomberg News. “If the recovery is 74 percent in what has been one of the worst municipal bankruptcies, that should give some people in the market more comfort,” said Dillon.
While pensions are treated as “unsecured” debts, Orr declared last week that the unlimited-tax general-obligation debt would be considered as “secured” debts in the plan of adjustment because they held a claim on a portion of property tax revenue. Orr had previously included them among bondholders with lesser claims on revenue—with a proposed payout of as little as 14 cents on the dollar. The reversal has reportedly led to a renewed wave of speculative activity on the $3.7 trillion municipal market.
Reprinted with permission

Oil Prices Could Be Just Dollars Away From The “Danger Point”! ISIS Fighters Attack LARGEST Oil Refinery In Iraq, Exxon Evacuates….

ExxonMobil has carried out a “major evacuation,” and BP had evacuated 20 percent of its staff, the head of Iraq’s state-run South Oil Company said Wednesday.
Dhiya Jaffar also said ENISchlumbergerWeatherford and Baker Hughes had no plans to evacuate staff from Iraq following the lightning advance of Sunni militants through the country. The companies, which are based in southern Iraq where the government is still in firm control, were not immediately available for comment.
From Bloomberg:
The global economy faces a new threat from an old enemy: oil.
A spike in the price of crude foreshadowed economic slumps in each of the last four decades and economists are worrying anew after Brent touched its highest price in nine months above $113 a barrel amid fresh violence in Iraq, OPEC’s second biggest producer. Brent started the year about $6 cheaper.
The rule of thumb favored by many economists is that every $10 increase in the price of a barrel of oil ends up cutting global growth by about 0.2 percentage point. That’s not an inconsequential amount for an already lackluster expansion. The World Bank last week cut its outlook for 2014 global growth to 2.8 percent.
“There is no doubt that, beyond a certain point, higher prices become a major constraint on global economic activity, particularly if the price reflects supply problems rather than buoyant demand,” said Julian Jessop, chief global economist at Capital Economics Ltd. in London.
Net energy importers such as China and Japan would suffer the most from any jump, though exporters in the Middle East would benefit to mitigate growth concerns, according to Neil MacKinnon, a global macro strategist at VTB Capital Plc in London.
ALERT!! ISIS Fighters Attack LARGEST Oil Refinery In Iraq

Insurgency in Iraq
Nation wide gass prices
Gas prices in 14 states now at 15-month highs
Alaska ($4.04).

Oregon ($3.92).

Washington ($3.93).

Missouri, Wyoming ($3.50).

Nevada ($3.84).

New Mexico ($3.48).

North Dakota ($3.60).

Oklahoma ($3.46).

Arizona ($3.53).
China has far more at stake in Iraq than America
“….The Chinese, on the other hand, would have a much harder time if Iraq’s 3.7% of global production suddenly went offline.  China, which is increasingly dependent on energy imports, is now that country’s largest foreign customer, taking an average 1.5 million barrels a day, almost half of Iraq’s production. China National Petroleum Corp., a state enterprise, swooped up Iraqi oil after last decade’s war—Beijing, by the way, sold arms that ended up in the hands of insurgents fighting Americans—by accepting Baghdad’s razor-thin margins and onerous conditions….”
BAGHDAD — Since the American-led invasion of 2003, Iraq has become one of the world’s top oil producers, and China is now its biggest customer.
China already buys nearly half the oil that Iraq produces, nearly 1.5 million barrels a day, and is angling for an even bigger share, bidding for a stake now owned by Exxon Mobil in one of Iraq’s largest oil fields.
“The Chinese are the biggest beneficiary of this post-Saddam oil boom in Iraq,” said Denise Natali, a Middle East expert at the National Defense University in Washington. “They need energy, and they want to get into the market.”

 

PROOF Global Financial Markets Rigged by Central Banks



U.S. Opens Safety Review of Chryslers

Photo
An agency is investigating ignition-safety issues in Chryslers similar to those at General Motors. Credit Rebecca Cook/Reuters 
 
 
Concern over the safety of ignition switches is spreading beyond General Motors cars.
Federal regulators disclosed on Wednesday that they were conducting a review of all the major automakers for ignition-switch problems similar to the safety defect that G.M. has linked to at least 13 deaths.
The review, by the National Highway Traffic Safety Administration, has turned up potential problems in at least one company so far. The agency announced that it had opened investigations into about 1.2 million Chrysler vehicles over concern that jostling the ignition key could accidentally cut power in a moving car and disable the air bags — a flaw strikingly similar to the one that has thrown G.M. into turmoil and forced it to recall millions of small cars.
In a statement, the safety agency said the Chrysler inquiries were part of new “broader efforts” to evaluate problems with ignition systems and failure of air bags to deploy in crashes. Toward that end, the agency said it “examined all major manufacturers’ air bag deployment strategies as they relate to switch position.”
A spokeswoman did not immediately respond when asked whether the industrywide review was finished, but the statement said the agency “will continue to refine its knowledge of these systems.”
The G.M. ignition-switch defect has brought scathing public criticism, a half-dozen investigations and scores of lawsuits, in part because the company acknowledges it waited more than a decade to recall the vehicles even though the problem was known and studied internally for years.
As the Chrysler ignition issues were being made public on Wednesday, G.M.’s chief executive, Mary T. Barra, was testifying before a congressional committee investigating the company’s handling of the issue, her third appearance before lawmakers on the matter this spring.
Contacted after N.H.T.S.A.’s announcement, Honda, Ford, Nissan and Toyota said they continuously monitor consumer complaints and warranty issues, but had not paid any special attention to ignition issues as a result of G.M.’s problems. Hyundai and Volkswagen did not immediately respond to messages.
A review of complaints filed to the N.H.T.S.A. by drivers of cars made in the last 10 years showed that reports of stalls of moving cars related to ignition-switch problems were not limited to vehicles made by G.M. and Chrysler; such complaints existed for a variety of vehicles.
One filed in June 2005 about a 2004 Toyota Solara indicated that the car repeatedly shut off “while driving 25 mph, 55 mph, 65 mph, and other speeds.” The driver brought the car to several dealers near Deforest, Wis., according to the complaint. None could duplicate or fix the problem.
Another driver of a 2004 Honda Accord wrote in July 2004, alarmed that the car had shut off on an expressway in Yardley, Pa., while going 65 miles an hour. After coasting to the side of the road, “I was able to start the car up and then realized that the ignition key had slipped forward into the off position while I was driving,” the driver wrote.
Alec Gutierrez, a senior analyst at Kelley Blue Book, the car valuation firm, said taking a close look at ignition issues industrywide might be a prudent move.
“I think it’s something that might be worth looking at from our perspective,” he said. In many thousands of test drives of brand-new vehicles, Mr. Gutierrez said he had never experienced an ignition cutting out. But he said it was worth investigating whether problems are likely to develop in older cars and whether most companies use similar switch designs.
The Chrysler investigations cover certain model years of Jeep Commanders and Grand Cherokees; Grand Caravan and Town and Country minivans; and Journey sport-utility vehicles. In 2011, Chrysler recalled a small portion of those cars for ignition stall-outs — 196,000 model year 2010 Grand Caravans, Journeys and Town and Country minivans, as well as 12,700 Volkswagen Routans that were built by Chrysler.
But the safety agency said it was looking at whether to expand that recall. Regulators said they had received 23 complaints about ignition-key problems from owners of models that were not recalled, as well as a few from people who said they had the recall repairs made, but the problem occurred again.
N.H.T.S.A. is also investigating whether Chrysler should be required to recall about 525,000 Jeep Commanders from the 2006 and 2007 model years, and Jeep Grand Cherokees from the 2005 and 2006 model years, according to a report published Wednesday on the agency’s website.
The agency said it had received at least 32 complaints, stretching back six years, from Jeep owners who say that the driver’s knee hit the ignition-key chain.
At least one of those complaints goes back to 2008, but the agency did not open an investigation until Wednesday.
“This causes the engine to shut off, affects power steering and brakes and may potentially result in the vehicle’s air bags not deploying during a frontal crash,” the report said. Regulators said there was one crash and no injuries associated with the problem.
“This has happened four times now,” wrote one owner in a complaint filed in June 2008. “I was driving my 1-year-old son to the babysitter’s house. My knee bumped the key as I was approaching a turn, shutting off the vehicle/power steering.”
“Luckily I slammed the brakes and stopped just in time,” the owner said.
Chrysler said it was cooperating with regulators. “Chrysler Group is awaiting additional information from the National Highway Traffic Safety Administration,” the company said in an email.
Some drivers who wrote in to the safety agency’s website noted the placement of the ignition. For example, the driver of a 2005 Saab in South Euclid, Ohio, said that the ignition’s position, on the console between the driver and passenger seat, left it vulnerable to being jostled. “At over 60 mph,” the driver wrote, “the ignition has been accidentally turned off. This causes an immediate loss of power steering and power brakes, making the car very difficult to steer and stop.”
The ignition key, the owner continued, “is not protected nor locked in any way to safeguard bumping the key and turning off the ignition. My local dealer has no parts or repair to correct the problem and Saab USA does not acknowledge that a problem exists.”
Ignition systems that use a key to turn the vehicle on are fairly simple, well-understood systems, said Anna G. Stefanopoulou, a professor of mechanical engineering and director of the Automotive Research Center at the University of Michigan.
The problem, she said, is that carmakers have added more features that need electric power, like power assist on the steering and deploying air bags.
But these ignition systems have been so tried-and-true that automakers have not developed backup systems to provide power should the engine be accidentally turned off, she said in a telephone interview. Such systems, she added, are very expensive and typically found only in the aerospace industry.
“This is a particularly unique situation because a lot of the electrical systems are based on the assumption that you will have the electricity,” she said.