'Crash JP Morgan, Buy Silver' Update!!

Max and Minimax

Zany madcap financial commentator Max Keiser has an unparalleled track record of economic and geopolitical forecasting. So much so that the BBC gave him his own show called 'The Oracle'

Max's portfolio of uncanny predictions and empowering analytical insights include...

• prophesying that the Euro was shortly to become the world's reserve currency, a couple of months before it went tits up

• declaring his support for US Presidential candidate Barack Obama on the basis that there was a very good chance Obama would bring about 'change'

• connecting record cold, warm, wet, dry, windy, not windy, weather events with catastrophic anthropogenic global warming climate change disruption, as well as postulating that there may be some connection between weather and crop yields

• predicting that the US Comex gold and silver exchange would default catastrophically in 2008, which it clearly did, without anyone noticing
  

• foretelling that the US will distance itself from Israel in its hour of need, just like it abandoned South Vitenam

The man is a soothsaying sensation, though it's not immediately clear if he is simply a brilliant analyst, gifted with superhuman psychic abilities, or whether the Universe actually submissively conforms to His Will

From the moment Keiser started his 'Buy Silver, Crash JP Morgan' campaign a couple of months back I've been watching global silver prices like a hawk

Komment Macht Frei - all my favourite people, and ideas, in one handy place

Keiser's plan was simplicity itself. JP Morgan has (allegedly) been driving the price of silver down by selling billions of dollars of silver it didn't actually possess. If enough people were to call JP Morgan's bluff, buy physical silver and drive the price up, JP Morgan's positions would collapse and the price of silver would skyrocket - destroying an evil bank and enriching those who killed it in the same act

A brilliant plan. Of course, if JP Morgan were to ever implode the resulting costs and losses (plus a dollop extra) would simply be assumed in all our names by government. But, nevertheless, a really, really brilliant plan

So, how's it doing? How much money have the legions of junior league silver bugs who have followed Max's call to 'Buy Silver, Crash JP Morgan' made so far?


Yup, The Oracle is still truly at the peak of his powers


Actually, anyone who joined the 'Buy Silver, Crash Morgan' campaign would have potentially enjoyed an even bigger (negative) return than -10.48% over the last 30 days

Silver coins, even those without a collectable value, sell for a mark-up of 15% or more over the scrap value of their silver content. Max presumably knows all about the excellent mark-ups in the bullion biz, as his site is, coincidentally, sponsored by bullion dealers

On top of the dealer's margin, if you buy a silver coin in Europe it is liable for VAT of, typically, 20%

So, if you bought a 1oz silver coin for something like £24 a month ago, it is now worth a shade under £17 today. Your £7 loss being shared out amongst the bullion dealer, the government's creditors, and speculators like JP Morgan

Sweet

And, yes, the fiat price of silver, and most other needful things which can't be printed into existence, will very possibly rise ahead of wages and interest on savings but timing, as they say, is everything

In the meantime, as fundamentally worthless as fiat currency is, the Max Keisers and JP Morgans of this world will still sell their grannies for a pot of it

Or, as a fellow conspiranaut said "If you want to put your hand in our pocket Max, give our nuts a scratch while you're at it...." .

.

Michael Hudson gives me the horn pt.328

Curiously for a conspiraloon economician, Michael Hudson does not promote precious metals with every waking breath, he clearly believes that the megarich vs poor paradigm isn't a false one and he does not appear to be focused on engendering a sense of collapsafarian despair in his listeners...

Hudson isn't going to sell very many Krugerands or water filters with talk like that

-

Listening to this latest dose of Hudson I was reminded, as I usually am when listening to Georgists, of the land ownership systems adopted during the Gold Rushes of the 19th Century.

Because the mining camps were set up in wilderness areas, beyond the reach of established governing systems or landlords, the miners got together and made up the rules for themselves.

The rules were simple enough; one person, or small group, could stake only one claim and the claim was no bigger than that person or group could work. If claimants did not work the claim they lost it

Whilst not a perfect system, it did restrict the scope for rent, speculation and generally poncing off people who actually worked for a living

Anyone who tried accumulating claims so that they could rent out or speculate with them, whilst sitting on their arse, ran a real risk of being hit repeatedly on the head with pick axe handles

Of course, this kind of thinking was suppressed as soon as the camps got properly civilised

-

It always baffles me when people 'of the right' dismiss the very notion of social welfare as being an unworkable utopian fantasy because they believe it results in a system where people are paid to do nothing

As if spongers being paid to do nothing is somehow a pitfall unique to left wing systems

Whenever anyone plays that card I find myself thinking of people like this twunt...

The Duke of Twuntminster

He left school with only one O Level, in spite of the best education money could buy, has done nothing especially productive or clever in his adult life and yet is one of the richest land-owners in the country. He lives entirely off the labour of others and has done absolutely nothing to deserve that privilege. Thanks largely to the fact that he'll pay fuck all tax, in life and death, he and his progeny will continue to accumulate capital and increase the amount they leach off everyone else in a way that simply isn't possible for us paeons

Whatever your political persuasion, I believe it's pretty difficult to make a case for parasitism of this nature. Those who have 'left wing' sensibilities will see it as unfair. Those with a 'right wing' point of view should see it as a pretty shit way of allocating scarce resources or stimulating productivity. The fact that many ordinary people with right wing views don't get what's going on is one of the triumphs of the plutocratic class

Though, for the life of me, it's sometimes hard to put my finger on which of the members of that class are the ones who are actually smart enough to keep this charade going

.

Michael Hudson explains Neo-serfdom pt27

Scroll forward to 13:30 and sit back whilst Prof. Hudson lets rip with his smooth, easy-listening, duck-like tones...

IMHO it's worth spending a little time switching onto what Hudson has been saying all these years because the explanatory and, more importantly, the predictive power of his model of how economics works is solid. If you want to know how things are expected, by the powers that be, to play out in Austerity UK he most definitely is worth listening to

.

Michael Hudson - getting out a lot more these days...

My Messiah is Sexier than Yours - The Sequel

A straight rip of a posting made by The Antagonist in another place...


Vimeo: Dolores invokes Christ on Eviction Day

Edit: Except, it didn't do much good....


Return to Tyting - Four days after eviction and the Messiah returns to find Dolores' mirror broken and burned.

Joking and parody aside, it's all quite serious really.


Given what is in the process of being unleashed on the world, especially to people who labour under the misapprehension that they, not the banks, own their homes, I find The Shayler Being's move into a new area of activism moderately interesting

Maybe he'll be able to further the cause of The Dispossessed in the same way that he did for the 9/11 and 7/7 Truth movements

-

and on the subject of the (Future) Dispossessed, Max Keiser has upped his game considerably and is now including some serious talent in his shows, and even occasionally keeping his gob shut and easing up on the faux outrage long enough for them to get to say something

The latest edition of The Truth About Markets features a megamix of Keiser interviews with Michael Hudson (the Dark Prophet of Neofeudalism and always worth listening to) and Karl Denninger, capped by 15 minutes of classic Keiser faux outrage at the behaviour of Goldmans* at the end

Professor Michael Hudson

Worth putting on the wireless music player whilst doing some household chores, just on the strength of Hudson's turn if nothing else



* = That would be the Goldmans which is definitely not at the heart of a dense, interlocked web of inter-related, vested financial interests which spans nations and governments and which definitely has no qualities which could be construed as the basis for elitist, conspiratorial, kleptocratic behaviour. That Goldmans

.

.

Green Shoots of Recovery, Yay!!

Some debt porn nerd over at House Price Crash forum has put together a lovely little graph of average UK house prices as a multiple of average UK annual wages, based on data from the Nationwide Building Society going back to 1953...




Average property prices peaked a couple of years ago at over six times average wages. Every property crash in the last 50 years has seen property prices fall back to at least 3.5 times average wages. Which, if history repeats itself, would be a fucking excellent thing - unless anyone really thinks shackling future generations to a historically unsustainable ratio of housing costs to wages is a remotely sensible idea

Wages are either going to have to go up, lots.

Or house prices are going to have to fall further, lots

And I know which of the two options I think is most likely

That's it. That's the story

You are Here

And no amount of bollocks peddled by vested interests from the mainstream media, politics or business will change that


.

Newstopia explains the Reserve Bank

The Feckless Unemployed

I've just spent ten minutes typing out a response to question someone asked me underneath an earlier post and, f*** it, that makes it long enough to be a post of its own...

Anon - 05 January 2009 13:00

Stef, what do you make of this statement? (something I hear quite a lot in certain social circles):

Although it is true, there was a whole program on BBC dedicated to it. I said that we don't do the jobs on average as well as they do. That's not opinion, that's fact. There are plenty of stats flying around about workforce productivity in the labour market comparative to earlier years. A trip to Google might suffice.

The jobs will likely be filled at one point or another, although I wouldn't expect it to be the kind of speed at which they were taken a year ago. The sad truth is that a British citizen can quite effortlessly gain 15k a year through benefits, so why earn 11k at subway and have to work for it? Unemployment has far too many benefits, no pun intended.

As for those who are employed, take builders for example... It's pretty common knowledge that if you want an excellent individual job done you don't employ British labour. It's par to say the least, where as the foreigners really earn their money and do a great job (talking averages here), and do it a lot cheaper.

The absence of the immigrants means that we're not going to be filling jobs as fast, we're going to lose out on productivity, and it's going to waste money for corporations. Be that on recruitment, productivity, employment (maternity rights, anyone?), and general service. And that affects our economy.

A lot of people slate the Polish for reasons they don't understand, but they were actually a great benefit to our nation - and they expect very little.

Stef - 05 January 2009 14:32

There's a lot of talk in the press about one group of benefit scroungers, the 'feckless' unemployed, and fuck all talk about another group of benefit scroungers, exploitative employers, who can get away with paying shit wages and benefits because the shortfall in what they give their staff is picked up by the welfare state

The DSS, that would be the rest of us, effectively subsidises lousy companies

So maybe, just maybe, a large part of the problem is not that the benefits are too high but that the wages are too low

Anxiety Culture

It's also worth remembering that the expression 'productivity improvement' is largely a euphemism for paying people less money to produce more output

Maybe you could argue that was a good thing if that money made was reinvested in productive infrastructure or paid out in dividends to the people who took the risks and created the jobs in the first place.

What usually happens in practice is that the financial benefits of 'productivity improvements' are trousered by senior management who have no problem with paying people more to do less; provided they are the people being paid more and doing less

By any measure, income inequalities in the UK have increased over the last 10-15 years off the back of this kind of mentality

And, as well as being inequitable, it's unsustainable because, sooner or later, once you've ripped off ordinary people past a certain level they can no longer afford to buy the goodies that make your system go round. They can start borrowing, of course, but that can only work for so long; as we're currently in the process of finding out

People forget now but about 10-15 years ago the press was full of talk of a 'leisure bonus', as new technologies promised to reduce the amount of time people would need to spend at work.

Fifteen years on and now we're being told that we won't be able to afford ever to retire

What happened?

Imagine for a moment you're a member of the Evil Overlord class. Can you imagine anything worse than the prospect of the plebs having more free time on their hands and becoming financially independent?

Fuck that

Think about the kind of useless jobs so many of us are engaged in. Jobs that offer no real benefit to society as a whole and absolutely no sense of satisfaction or self-worth to the people doing them.

Anxiety Culture

The Evil Overlord class would have us believe that any job, however pointless and soul destroying, is worth having just for its own sake

Bollocks to that

It's also worth pondering upon the fact that the vast majority of jobs people would identify as being intrinsically worthwhile and offering a sense of self-worth to the people doing them usually sit at the bottom of society's pay scales. And, speaking as someone who's held down a couple of highish paying jobs in his time, I can absolutely guarantee that higher pay is absolutely in no way intrinsically linked to high ability, high intelligence, high integrity or high commitment

Migrants play along with this shit because they're economically desperate and easily exploited. Neither of these qualities strike me as something we should be encouraging in our society; however profitable they may be for The Few

.

Austrian Monopoly

One of the cornerstones of the official narrative of the current economic meltdown is the excuse that 'no-one saw the collapse of the housing market coming'

This is, of course, nonsense

Anyone vaguely numerate, or blessed with even a passing knowledge of history, was equipped with all that was needed to anticipate the inevitable crash

Greed, stupidity, ignorance and the endless human capacity for self-deception all contributed to ensuring that the majority of people played along with the madness for as long as the people who orchestrated it considered to be expedient

I had reason to consider the ignorance part of the equation whilst, of all things, playing a game of Monopoly with some kids a few days ago




From an amateur economician's point of view, one of the interesting things about Monopoly is that the longer a game lasts the more money goes on the table. Regular cash injections are made into the game every time a player circuits the board and receives a crisp £200 from the bank for their trouble.

The Monopoly economy goes from strength to strength and players are able to buy land and build houses thanks to the generous handouts from the bank

The problem with the Monopoly economy and the reason why it dawned on me the other day that it is a particularly sneaky example of subliminal programming is that, unlike the world the children grow up into, the Monopoly bank never gets round to clawing all the money back

One simple rule change would transform a game of Monopoly into a powerful educational tool that could possibly help junior avoid turning into a financial fuckwit when he grows up...

After the first 30 minutes of play, the bank stops giving out £200 every time the player goes round the board and demands payment of £250 each time instead

As each player succumbs to inevitable bankruptcy they are forced to stand outside on the street, in the rain, holding a half empty can of budget lager

Play continues until the bank has removed all liquidity from the game and repossessed all the property

Anyone who was daft enough to have played the game then has to ask the banker's permission to take a piss for the rest of their lives...




Next Week - 'Thomas the Tank Engine - A Marxist Analysis'


.

Black Swans and Austrian Teddy Bears

At the bottom of an earlier post there's a little discussion about a couple of books I've been reading that contain some overlapping themes

The first is Nassim Taleb's The Black Swan

- Black Swans being large-impact, hard-to-predict, random, unplanned and rare events beyond the realm of normal expectations.

The second is Naomi Kein's The Shock Doctrine: The Rise of Disaster Capitalism

- Disaster Capitalism being the corporate exploitation of people in the wake of disasters or upheavals

The big problem I have with both Taleb and Klein is that they both do a stand-up job of peddling that absolutist, stochastic, 'shit just happens' world view which is so useful to those people who gain the most when things get fucked up

Klein pays nowhere near enough attention to the possibility that many of the disasters and upheavals she refers to were staged, or at least anticipated

Taleb quotes events like the 9/11 attacks and stock market crashes as being examples of unpredictable, Black Swan events, when there's copious evidence that they were anything but. One person's Black Swan; be it due to deceit, dissonance, indoctrination, or plain incompetence, is very often another person's Bleeding Obvious.

Even the majority of natural, as opposed to man-made, disasters cannot fairly be described as Black Swan events. The people who live in places like New Orleans, Mexico City, Los Angeles or Naples know full well that their cities are inevitably going to get creamed sooner or later, and very possibly within the span of a human lifetime. The fact that many of those people engage in denial doesn't change the predictability of that creaming

Property Hot Spots of the Future #17 - Napoli

As such, both Klein and Taleb and the output of many others given prominence in the supposedly alternative, dissenting media, is paving the way for a truly useless, profoundly ineffective analysis of the ghastliness which many of us believe may be begining to overtake our world

-

At the heart of the ghastliness which many of us believe may be begining to overtake our world lies the imminent (?) collapse of the dollar and related currencies

The Imminent (?) Collapse of the Dollar Story goes something like this...

• Forty or more years ago America abandoned the Gold Standard and embarked on a policy of paying for its imports with increasingly devalued, worthless dollars
  
  
• America simply printed as many worthless dollars as it needed and exchanged them for imported stuff that was actually worth something
  
  
• This was made possible by the fact that everything sold on global markets was priced in dollars, so everyone around the world had to hold stocks of this intrinsically useless paper to buy essential commodities
  
  
• Any time anyone comes anywhere to buying and selling essential commodities with anything but dollars the Americans blow the shit out of them
  
  
• There are now so many useless dollars in circulation globally that the entire system is about to choke catastrophically. The Russians, the Chinese and others have had enough and are about to walk away from the whole stinking mess

On-line economician Peter Schiff tells a story about five Asians and an American stranded on a desert island. One of the Asians is responsible for fishing, another for hunting, another for growing vegetables, and so on. The American's 'job' is to eat a big fuck off meal prepared by the Asians every night and leave them enough crumbs to survive through to the next day...

Schiff is one of a loose group of bearish, Libertarian, Austrian School Economicians much beloved by Internet Loons, including my goodself

Other members of this elite club include Jim Rogers, Jim Puplava and, of course, Maaaaaaaax Keiser

(and Michael Hudson and F W Engdahl, sort of)

All of these guys have, to one degree or another, predicted that...

• The dollar and other fiat currencies of non productive countries will tank

• There will be a commensurate and massive rise in the dollar price of tangible commodities such as oil, wheat and gold

As it happens, commodities did rise and the dollar did fall earlier this year - to accompanying cries of 'this is it!', 'this is it!' from the little dollar bears

but it wasn't 'it'

The US dollar has subsequently strengthened massively and commodities, commodity-based shares and commodity-based currencies have dived to the floor

Any private investors following the advice of Schiff, Rogers, Keiser and Puplava will have lost up to 50% in two or three months. Anyone who follows their podcasts can't help but have been entertained by listening to Schiff attempting to placate one of his investors who called up after losing half of his life savings or the sound of Keiser melting down into a pool of despair and babbling about buying into dollars a few days ago




It's not that Schiff, Keiser, et al are actually wrong about the future

• The dollar and associated currencies are fucked

• The prices of things we can't do without - oil, food, water - will go up in a big, scary, unaffordable way

• The prices of things we can do without, or need a loan to buy - houses, cars, plastic tat will fall
  

Their problem is that the secret of good economic commentary, as with all forms of comedy, is



... timing



These guys have got their timing wrong because...


1. They underestimated just how crooked supposedly free markets are.

The Chinese increased their oil imports by 46% in September and bullion traders around the world cannot meet demand, yet the reported market price of oil and gold have fallen dramatically. Conclusion? The markets are bent


2. They are attempting to comment in real time about insanely volatile markets

The poor quality of market information available to mere mortals and the volume of market 'noise' is such that only a completely bow-tie wearing berk would attempt to extrapolate daily moves out into the future. The Internet deserves a lot of blame for the rise of this kind of commentary


3. They are nowhere near Loony enough

A lot of people have heard the famous Jefferson quote...

"If the American people ever allow private banks to control the issuance of their currency, first by inflation and then by deflation, the banks and corporations that will grow up around them will deprive the people of all their property until their children will wake up homeless on the continent their fathers conquered."

...but don't seem to have understood its implications.

The process Jefferson was talking about 200 years ago is deliberate and managed. Switches between inflation and deflation are only nurtured when it suits the people doing the managing and they are not in the business of telegraphing when that would be.

Years of inflation have already ensnared the bulk of people in debt. All that remains is to mop up the minority of people, mostly Baby Boomers who until a few months ago were expecting a nice, cushy retirement, who actually put money aside over that time

And those who placed their money in the markets have just lost 40-50% of their savings

Those who've kept away from the markets and are holding cash instead can look forward to a 0% interest rate, whilst prices are rising 10%+, as their reward

Once the savers have been rogered good and proper, that's everyone in the bottom 99.99% of society accounted for, then all the money our governments have released to the shadow banking system can be unleashed to buy everything that's worth buying unopposed

A massive transfer of real wealth will then take place and a glittering future of supercharged debt-serfdom secured

And even if some ordinary people manage to avoid mortgaging their lives away and actually retain some savings, there will still be plenty of tricks left in the toybox to deal with them

None of this is too far off now but I won't be picking any dates

.