“Central banks, big corporate bankers, and finance ministry heads have no clue what to do and have begun to display their panic. They are out of options.”
Gold Cover Clause Guidance
By: Jim Willie CB
Wednesday, 9 May 2012
If today’s landscape was a war setting, it would feature collapsed buildings, rubble on the streets, empty warehouses, smoke spewing upward from numerous city heaps, and fire hoses sending water in every conceivable direction throughout the entire city. And sadly, also dead bodies littered everywhere. They serve as the economic damage. The city ruins are marred by additional water damage, rubber boots a necessity. The buildings can be seen as the crumbled sovereign bonds. The street rubble is the home equity destroyed, some still underwater. The shattered warehouses are businesses either wrecked or in fast retreat. The smoke is the painful emotions based in despair, loss, and absent opportunity. In stark display, the fire houses are the central banks printing and dispensing money from tainted sources, not from factory income but rather the vacuous Weimar press. Of key significance is the compounded damage inflicted by the water itself. ZIRP and QE are tandem weapons of mass destruction that have been at work toward business destruction and capital ruin of the USEconomy for three full years. The zero interest rate policy assures the wrong pricing of money, the capital fuel, thus distorting all markets. The quantitative easing is based in extreme desperation, as the USGovt has lost the majority (80%) of its foreign creditor support.
The celebrated bond monetization assures the steady rise in cost structure which forces a vanishing of business profitability. The nation was taught improperly in pure heresy from USFed high priests that the free flowing liquidity was good, as the housing market expanded (bubble #1) alongside mortgage finance (bubble #2). The public was told incorrectly in 2007 that the damage would be limited. The Jackass forecasted absolute bond contagion and destruction, which has come to pass in shocking style. The sovereign bond collapse in Europe, where the USDollar printing must be conducted through the swap facility conduit, is evidence of the absolute destruction. Witness the collapse of the global fiat monetary system. The supposed solution from evermore central bank monetary creation has compounded the problem by adding to capital ruin. No solution within the current monetary framework is possible, thus the demand for gold. Impairment has moved from the margin to the core from water damage. Central banks, big corporate bankers, and finance ministry heads have no clue what to do and have begun to display their panic. They are out of options.