The world economy will soon go into an accelerated and precipitous decline which will make the 2007 to early 2009 downturn seem like a walk in the park. The world financial system has temporarily been on life support by trillions of printed dollars that governments call money. But the effect of this massive money printing is ephemeral since it is not possible to save a world economy built on worthless paper by creating more of the same. The hyperinflationary depression that many western countries, including the US and the UK, will experience is likely to mark the end of an era that has lasted over 200 years since the industrial revolution,” reports Egon von Greyerz of Matterhorn Asset Management.

Hot money in inflation mode
Tuesday the government reported producer prices rose for the first time in four months, while industrial production rose more than expected. That’s it, inflation is back! The Fed’s cheap money, or near-zero interest rates, after having failed to inspire much lending and borrowing from banks and consumers, is for sure leading investment banks and hedge funds to make big bets on such things as gold. Eton Park Capital Management LP, a hedge fund, revealed it took a big stake in the SPDR Gold Trust ETF on Monday with a regulatory filing,” reports Marketwatch.

Is Silver Ready to Move Higher?
There are several compelling reasons to consider adding physical silver to your precious metal portfolio, but why isn’t silver receiving the same attention as gold? Silver is still in stage one of its bull market, while gold is already in stage two. Bull market first stages are always marked by apathy….and disbelief that any uptrend is sustainable. Those conditions explain what happened to gold, when it was under $1,000/oz. Only when it hurdled that psychological barrier did gold start receiving widespread attention of its attributes and upside potential,” reports James Turk at GoldMoney.

Protect yourself from inflation with silver bullion coins.

2010 Year of the Tiger – 1 oz Silver Coin (Series 2)
Created due to popular demand from international investors, the Perth Mint’s Lunar design theme is secure for another 12 years with the introduction of the Australian Lunar Silver Bullion Coin Series II.

Proof Quality 99.9% Pure Silver
Struck from 99.9% pure silver, the 2010 releases are available as individual 1 kilo and 1oz coins and in a Three-Coin Set comprising 2oz, 1oz and 1/2oz coins. (1 kilo denomination shown in obverse illustration.)

Year of the Tiger Design
The reverse of each coin depicts a tiger lying under a tree. As well as the inscription ‘Year of the Tiger’ and the Chinese character for ‘tiger’, the design also incorporates The Perth Mint’s ‘P’ mintmark.

Australian Legal Tender
Issued as legal tender under the Australian Currency Act 1965, each coin features the Ian Rank-Broadley effigy of Her Majesty Queen Elizabeth II on its obverse.

APMEX.com offers a wide variety of silver bullion, bars and coins. You can securely purchase your silver coins (Morgan Silver Dollars, Silver American Eagles, Silver Canadian Maple Leafs, Silver Chinese Pandas and more) , pure silver bars, silver rounds and 90% junk silver coins.

Here’s what some people are saying…

Bob Chapman
First 6 months of 2010, Americans will continue to live in the ‘unreality’ the period between July and October is when the financial fireworks will begin. The Fed will act unilaterally for its own survival irrespective of any political implications (source is from insider at FED meetings). In the last quarter of the year we could even see Martial law, which is more likely for the first 6 months of 2011. The FDIC will collapse in September 2010. Commercial real estate is set to implode in 2010. Wall Street believes there is a 100% chance of crash in bond market, especially municipals sometime during 2010. The dollar will be devalued by the end of 2010.

Gerald Celente
Terrorist attacks and the “Crash of 2010″. 40% devaluation at first = the greatest depression, worse than the Great Depression.

George Ure
Markets up until mid-to-late-summer. Then “all hell breaks lose” from then on through the rest of the year.

Neithercorps
Have projected that the third and final stage of the economic collapse will begin sometime in 2010. Barring some kind of financial miracle, or the complete dissolution of the Federal Reserve, a snowballing implosion should become visible by the end of this year. The behavior of the Fed, along with that of the IMF seems to suggest that they are preparing for a focused collapse, peaking within weeks or months instead of years, and the most certain fall of the dollar.

Webbots
July and onward things get very strange. Revolution. Dollar dead by November 2010.

LEAP 20/20
2010 Outlook from a group of 25 European Economists with a 90% accuracy rating- We anticipate a sudden intensification of the crisis in the second half of 2010, caused by a double effect of a catching up of events which were temporarily &laqno; frozen » in the second half of 2009 and the impossibility of maintaining the palliative remedies of past years. There is a perfect (economic) storm coming within the global financial markets and inevitable pressure on interest rates in the U.S. The injection of zero-cost money into the Western banking system has failed to restart the economy. Despite zero-cost money, the system has stalled. It is slowly rolling over into the next big down wave, which in Elliott Wave terminology will be Super Cycle Wave Three, or in common language, “THE BIG ONE, WHERE WE ALL GO OVER THE FALLS TOGETHER.”

Joseph Meyer
Forecasts on the economy. He sees the real estate market continuing to decline, and advised people to invest in precious metals and commodities, as well as keeping cash at home in a safe place in case of bank closures. The stock market, after peaking in March or April (around 10,850), will fall all the way down to somewhere between 2450 and 4125 during the next leg down.

Harry Dent (investor)
A very likely second crash by late 2010. The coming depression (starts around the summer of 2010). Dent sees the stock market­currently benefiting from upward momentum and peppier economic activity ­headed for a very brief and pleasant run that could lift the Dow to the 10,700-11,500 range from its current level of about 10.090. But then, he sees the market running into a stone wall, which will be followed by a nasty stock market decline (starting in early March to late April) that could drive down the Dow later this year to 3,000-5,000, with his best guess about 3,800.

Richard Russell (Market Expert)
(from 2/3/10) says the bear market rally is in the process of breaking up and panic is on the way. He sees a full correction of the entire rise from the 2002 low of 7,286 to the bull market high of 14,164.53 set on October 9, 2007. The halfway level of retracement was 10,725. The total retracement was to 6,547.05 on March 9, 2009. He now sees the Dow falling to 7,286 and if that level does not hold, “I see it sinking to its 1980-82 area low of Dow 1,000.” The current action is the worst he has ever seen. (Bob Chapman says for Russell to make such a startling statement is unusual because he never cries wolf and is almost never wrong)

Niño Becerra (Professor of Economics)
Predicted in July 2007 that what was going to happen was that by mid 2010 there is going to be a crisis only comparable to the one in 1929. From October 2009 to May 2010 people will begin to see things are not working out the way the government thought. In May of 2010, the crisis starts with all its force and continues and strengthens throughout 2011. He accurately predicted the current recession and market crash to the month.

Lyndon Larouche
The crisis is accelerating and will become worse week by week until the whole system grinds into a collapse, likely sometime this year. And when it does, it will be the greatest collapse since the fall of the Roman Empire.

WALL STREET JOURNAL- (2/2010)
“You are witnessing a fundamental breakdown of the American dream, a systemic breakdown of our democracy and our capitalism, a breakdown driven by the blind insatiable greed of Wall Street: Dysfunctional government, insane markets, economy on the brink. Multiply that many times over and see a world in total disarray. Ignore it now, tomorrow will be too late.”

Eric deCarbonnel
There is no precedence for the panic and chaos that will occur in 2010. The global food supply/demand picture has NEVER been so out of balance. The 2010 food crisis will rearrange economic, financial, and political order of the world, and those who aren’t prepared will suffer terrible losses. As the dollar loses most of its value, America ’s savings will be wiped out. The US service economy will disintegrate as consumer spending in real terms (ie: gold or other stable currencies) drops like a rock, bringing unemployment to levels exceeding the great depression. Public health services/programs will be cut back, as individuals will have no savings/credit/income to pay for medical care. Value of most investments will be wiped out. The US debt markets will freeze again, this time permanently. There will be no buyers except at the most drastic of firesale prices, and inflation will wipe away value before credit markets have any chance at recovery. The panic in 2010 will see the majority of derivatives end up worthless. Since global derivatives markets operate on the assumption of the continued stable value of the dollar and short term US debt, using derivatives to bet against the dollar is NOT a good idea. The panic in 2010 will see the majority of derivatives end up worthless. The dollar’s collapse will rob US consumers of all purchasing power, and any investment depend on US consumption will lose most of its value.

Alpha-Omega Report (Trends Forecast)
Going into 2010, the trends seemed to lead nowhere or towards oblivion. Geo-politically, the Middle East was and is trending towards some sort of military clash, most likely by mid-year, but perhaps sooner. At the moment, it seems 2010 is shaping up to be a year of absolute chaos. We see trends for war between Israel and her neighbors that will shake every facet of human activity. In the event of war, we see all other societal trends being thoroughly disrupted. Iran will most likely shut off the flow of oil from the Persian Gulf. This will have immense consequences for the world’s economy. Oil prices will skyrocket into the stratosphere and become so expensive that world’s economies will collapse..There are also trend indicators along economic lines that point to the potential for a total meltdown of the world’s financial system with major crisis points developing with the change of each quarter of the year. 2010 could be a meltdown year for the world’s economy, regardless of what goes on in the Middle East .

Robin Landry (Market Expert)
I believe we are headed to new market highs between 10780-11241 over the next few months. The most likely time frame for the top is the April-May area. Remember the evidence IMHO still says we are in a bear market rally with a major decline to follow once this rally ends.

John P. Hussman, Ph.D.
In my estimation, there is still close to an 80% probability (Bayes’ Rule) that a second market plunge and economic downturn will unfold during 2010.

Robert Prechter
Founder of Elliott Wave International, implores retail investors stay away from the markets for now. Prechter, who was bullish near the lows in March 2009, now says the stock market “is in a topping area, “predicting another crash in 2010 that will bring stocks below the 2009 low. His word to the wise, “be patient, don’t rush it” keep your money in cash and cash equivalents.

Richard Mogey
Current Research Director at the Foundation for the Study of Cycles- Because of a convergence of numerous cycles all at once, the stock market may go up for a little while, but will crash in 2010 and reach all-time lows late 2012. Mogey says that the 2008 crash was nothing compared to the coming crash. Gold may correct in 2009, but will go up in 2010 and peak in 2011. Silver will follow gold.

James Howard Kunstler (January 2010)
The economy as we’ve known it simply can’t go on, which James Howard Kunstler has been saying all along. The shenanigans with stimulus and bailouts will just compound the central problem with debt. There’s not much longer to go before the whole thing collapses and dies. Six Months to Live- The economy that is. Especially the part that consists of swapping paper certificates. That’s the buzz I’ve gotten the first two weeks of 2010.

Peter Schiff (3/13/2010)
“In my opinion, the market is now perfectly positioned for a massive dollar sell-off. The fundamentals for the dollar in 2010 are so much worse than they were in 2008 that it is hard to imagine a reason for people to keep buying once a modicum of political and monetary stability can be restored in Europe . In fact, the euro has recently stabilized. My gut is that the dollar sell-off will be sharp and swift. Once the dollar decisively breaks below last year’s lows, many of the traders who jumped ship in the recent rally will look to re-establish their positions. This will accelerate the dollar’s descent and refocus everyone’s attention back on the financial train-wreck unfolding in the United States . Any doubts about the future of the U.S. dollar should be laid to rest by today’s announcement that San Francisco Federal Reserve President Janet Yellen has been nominated to be Vice Chair of the Fed’s Board of Governors, and thereby a voter on the interest rate-setting, seven-member Open Markets Committee. Ms. Yellen has earned a reputation for being one of the biggest inflation doves among the Fed’s top players.” Schiff is famous for his accurate predictions of the economic events of 2008.

Lindsey Williams
Dollar devalued 30-50% by end of year. It will become very difficult for the average American to afford to buy even food. This was revealed to him through an Illuminati insider.

Unnamed Economist working for US Gov’t (GLP)
What we have experienced the last two years is nothing to what we are going to experience this year. If you have a job now you may not have it in three to six months. (by August 2010). Stock market will fall = great depression. Foreign investors stop financing debt = collapse. 6.2 million are about to lose their unemployment.

Jimmy “Doomsday”
DOW will fall below 7,000 before mid summer 2010- Dollar will rise above 95 on the dollar index before mid summer 2010- Gold will bottom out below $800 before mid summer 2010- Silver will bottom out below $10 before mid summer 2010- CA debt implosion will start its major downturn by mid summer and hit crisis mode before Q4 2010- Dollar index will plunge below 65 between Q3 and Q4 2010- Commercial real estate will hit crisis mode in Q4 2010- Over 35 states will be bailed out by end of Q4 2010 by the US tax payer End of Q4 2010 gold will hit $1,600 and silver jump to $35 an oz.

Gold has hit record highs as the dollar slumps and the Euro continues to face complete collapse.

Unemployment figures in the U.S. are through the roof and U.S. consumer prices posted their largest fall in nearly 1-1/2 years in May.

Rumours in Europe persist regarding an impending bailout for spain, while Russia says it is ready to found a “new economic world order“.

The dramatic and costly undertow of deflation continues unabated, as government via fiscal policy and the Federal Reserve, by creating money and credit out of thin air, proceed to overpower this deflation with massive inflation.

Unbeknownst to most the Fed and the Treasury have been maintaining this program for the past several years, accompanied by most major countries, all of which have taken the path of least resistance rather than address the underlying problems.

The current stage of problems had to be addressed 2-1/2 years ago in what has become known as a credit crisis. This continuing crisis has been accompanied by 22-1/8% current unemployment that has resulted in a perpetual fall in tax revenues and a resultant enlargement of government deficits. We might add that this condition is being experienced by many countries worldwide, which followed America’s leadership into this terrible financial and economic morass. These policies have led to massive sovereign debt policies, a hangover of the policies of 1933 and 1971.

The financial system in America is on the edge of default. A recent poll found that 92% of those surveyed wanted to unseat their current representative or Senator in Washington and only 21% believed that government enjoyed the consent of the governed. It’s very obvious people are not happy with the political, economic and financial situation presently. Eighty percent believe that government is enmeshed in partisan infighting. Not only between parties, but within parties as well. Politicians are very aware of these numbers and are frantic to get reelected. The public has recoiled in disgust. People are demanding that the power of government be curbed. People are sick and tired of paid off corrupt politicians, more than half of whom have been in office for more than ten years.

It is not healthy for a nation to have $3.3 trillion in Treasury bonds held by foreigners. China holds about $900 billion and Japan about $800 billion. We also understand that hedge funds and others also are fronting both countries, so the figures are not really reflective in their total positions. These nations for the most part are rolling their positions, but have not injected new capital into US Treasuries. That is why the Fed had to fund 80% of new Treasury debt last year.

Presently the Fed is fighting and pulling out all stops to halt legislation to audit the Federal Reserve, a private corporation, which has managed our monetary policy since 1913, under the Federal Reserve Act. On Monday the Treasury held a media conference for financial reporters and bloggers in which the Fed was discussed. The meeting had some very strange conditions. Mr. Geithner, Mr. Krueger and Mr. Sperling could be paraphrased but not quoted and what was paraphrased could not be connected to a specific official. Again, the element of secrecy to protect the guilty. One blogger said, “Did they get the ground rules from Al Qaeda?” The meeting was a travesty. How can government officials demand secrecy in public briefings? It is no wonder that 90% of the public and 317 members of Congress want more Treasury transparency and an audit and investigation of the Fed. This is the same gang run by Geithner and Bernanke that are currently running the gold suppression scheme. When you have a criminal cabal involved you have no transparency. That is why the audit of the Fed is so important. Such an exercise would expose exactly what both have been doing in the markets. The Fed and Treasury have lied for years about what they have been up too in behalf of their Illuminist friends. It is not only about the actions of the President’s Working Group on Financial Markets, but the funding of Watergate, Saddam Hussein, who they supposedly conveniently hung, the countries that secretly received loans, how much, who got them and what was the collateral? Were currency swaps with foreign control banks used to strengthen the dollar by the Fed and for those foreign control banks to purchase Treasury and Agency paper? How about all the inside information funneled to Wall Street and banking for almost a century from both the Fed and Treasury? Their lies are legion. They both are manipulating every market in the world 24/7 and the American people want it stopped. We also want an audit of America’s gold and the testing of the gold bars held. There is much we want to know, so we can save our country and our freedom.

Investors continue to chase yields, which is a dumb practice. Interest rates are at 80-year lows and can only stay the same or rise. People are grabbing junk bond yields that will come back to haunt them.

At least for now Greece and euro problems are being shuffled into the background. You can imagine this is not the last of the eurozone problems. The PIIGS will be back one by one to cause never-ending problems until they are forced to leave the eurozone. That will cause a eurozone breakup, probably by the end of next year.

This is the first real threat to the eurozone since its beginning ten years ago, and we think they will find that their rules are so restrictive that weak members will be forced to leave. The monetary policy and interest rates may be singular, but fiscal policy is not. Exchange rates for the euro must fit all members, but rates and methods of growth vary widely. With one currency sovereignty has effectively been lost. Public debt to GDP has to be under 3%, while most are over 3%: Greece is at 10.7%. There is also a public debt limit of 60% of GDP, which all nations in the zone have broken. All precepts have not and cannot be met. There is no effective policy because there is no way to enforce the rules. In addition most have current account deficits and the zone effectively has been carried by Germany from this aspect. The bottom line is a few have growth, the rest do not. As a result there is pressure, due to poor growth in some of the nations, for austerity measures to reduce fiscal deficits at the worst possible time. Greece comes first along with Ireland and the rest will follow.

Just as an example, Spain has a fiscal deficit of 10% of GDP that has to fall to 3% within three years, which is virtually impossible just as it is in Greece. Their current account deficit is 4.5% of GDP. In a recessionary/depressionary world getting into the plus column is a tall order. This dilemma is the result in part of the housing collapse caused by Spanish banks and inattention by the Bank for International Settlements. We see consumption continuing to fall in the face of 20% unemployment, which worsens by the day. The PIIGS and a present total of 19 nations are effectively bankrupt. We do not believe they can survive without devaluation and debt default. That is why we expect that to happen next year.

Historically banks have kept loan loss allowance ratios at $1.33 for every dollar of debt. Today it is 0.58%.

The commercial paper market rose $11.2 billion last week to $1.145 trillion.

The Treasury sold $21 billion in 10-year T-notes. The bid-to-cover was 3.45 to 1, which is average vs. 2.85 to 1. This was the highest since 1995. Indirect bidders, which include foreign central banks, bought 35.1%, compared to an average of 41.7% at the last four re-openings.

Almost 39 million Americans received food stamps in December, the most ever, as the jobless rate hovered near a 26- year high, the government said.

Recipients of the subsidies for food purchases climbed 23 percent from a year earlier and rose 2.1 percent from November, the U. S. Department of Agriculture said Thursday in a statement on its Web site. The number receiving the benefit has set records for 13 straight months.

Food aid climbed as the national unemployment rate reached 10.1 percent in October, the highest since June 1983, and remained at 10 percent through December before easing to 9.7 percent in January.

An average of 40.5 million people will get food stamps each month in the federal fiscal year that began Oct. 1, Agriculture Secretary Tom Vilsack said last week. The figure is projected to rise to 43.3 million in 2011.

Nevada had the biggest increase in the percentage of the population receiving the coupons, up 49 percent from December, USDA figures show. Texas had the most recipients, at 3.31 million, topping California’s 3.11 million.

The U.S. government recorded a budget deficit of $221 billion in February, the Treasury Department reported Wednesday, even as its income posted a big increase for the month.

Income totaled $107.5 billion in February, a 23% increase over last February’s total, and marking the first monthly year-over-year increase since April 2008.

Spending was $328 billion in February, up 17% year over year. That was the largest February total on record, a Treasury official said.

February was the 17th consecutive month that the government recorded a deficit. It was a little less than expected: last week the Congressional Budget Office predicted that the deficit would be $223 billion in February.

Year to date, the deficit is $652 billion, according to the Treasury data.

SEVEN HOUSE members, including Northern Virginia Rep. James P. Moran Jr. (D), collected more than $840,000 in political contributions from employees and clients of a lobbying firm, Paul Magliocchetti and Associates Group (PMA), during a two-year span. In that same period, the lawmakers, strategically situated on the Appropriations defense subcommittee, directed more than $245 million in earmarks to clients of PMA.

If you think those two facts are unrelated, you are qualified to be on the House ethics committee. The panel recently found that “simply because a member sponsors an earmark for an entity that also happens to be a campaign contributor does not, on these two facts alone, support a claim that a member’s actions are being influenced by campaign contributions.”

The ethics committee acknowledged that “there is a widespread perception among corporations and lobbyists that campaign contributions provide enhanced access to members or a greater chance of obtaining earmarks.” Gee, how could anyone have gotten that impression? Maybe because the lawmakers targeted those seeking earmarks for campaign contributions? Sent their key appropriations staffers to fundraisers?

For instance, in 2008, the appropriations director for Rep. Pete Visclosky (D-Ind.) told corporations interested in obtaining earmarks that they needed to submit requests by Feb. 15. On Feb. 27, Mr. Visclosky’s campaign manager sent a letter to companies that had sought his help on defense matters inviting them to a fundraiser on March 12. Mr. Visclosky’s political committees received $35,300 from clients of PMA that month, plus another $12,000 from the lobbying firm and its employees. A week after the fundraiser, which was focused on defense contractors and attended by his chief of staff and appropriations director, Mr. Visclosky requested earmarks for six PMA clients, totaling more than $14 million.

House leaders understand that voters may not be quite as obtuse as the ethics committee seems to assume, and their extreme embarrassment — over this and other scandals — may lead to useful action. The House is right to ban lawmakers from earmarking government funds for for-profit companies. It should go further, and extend the prohibition to nonprofit and educational institutions as well. Some nonprofit institutions spend enormous sums on lobbyists, who dispense campaign donations in hope of obtaining earmarks. More important, the Senate must follow suit, as much as it appears disinclined to do so. A system that aligns campaign cash and earmarks is inherently unseemly, if not outright corrupt, and the Senate is tainted by this setup as well.

We say this fully aware that the Constitution grants Congress the power of the purse and that earmarks are not close to the biggest reason for out-of-control spending. And that lawmakers have taken steps in recent years to reduce the number of earmarks and make the process more open. And that eliminating earmarks would not end every instance in which private interests lobby for — and make campaign contributions in hope of obtaining — particular favors.

It would, however, eliminate the worst such abuse. The House Ethics Manual cautions members “to avoid even the appearance that solicitations of campaign contributions are connected in any way with an action taken or to be taken in an official capacity.” The ethics committee, dismissing that caution and a recommendation by the newly created independent Office of Congressional Ethics to investigate two of the seven representatives, decided there was nothing to worry about in the PMA case. With standards this lax, the only reasonable choice is to end the earmarks that fuel this sleazy process. [This dramatically shows you why campaign contributions have to end.]

The dramatic and costly undertow of deflation continues unabated, as government via fiscal policy and the Federal Reserve, by creating money and credit out of thin air, proceed to overpower this deflation with massive inflation.

Unbeknownst to most the Fed and the Treasury have been maintaining this program for the past several years, accompanied by most major countries, all of which have taken the path of least resistance rather than address the underlying problems.

The current stage of problems had to be addressed 2-1/2 years ago in what has become known as a credit crisis. This continuing crisis has been accompanied by 22-1/8% current unemployment that has resulted in a perpetual fall in tax revenues and a resultant enlargement of government deficits. We might add that this condition is being experienced by many countries worldwide, which followed America’s leadership into this terrible financial and economic morass. These policies have led to massive sovereign debt policies, a hangover of the policies of 1933 and 1971.

The financial system in America is on the edge of default. A recent poll found that 92% of those surveyed wanted to unseat their current representative or Senator in Washington and only 21% believed that government enjoyed the consent of the governed. It’s very obvious people are not happy with the political, economic and financial situation presently. Eighty percent believe that government is enmeshed in partisan infighting. Not only between parties, but within parties as well. Politicians are very aware of these numbers and are frantic to get reelected. The public has recoiled in disgust. People are demanding that the power of government be curbed. People are sick and tired of paid off corrupt politicians, more than half of whom have been in office for more than ten years.

It is not healthy for a nation to have $3.3 trillion in Treasury bonds held by foreigners. China holds about $900 billion and Japan about $800 billion. We also understand that hedge funds and others also are fronting both countries, so the figures are not really reflective in their total positions. These nations for the most part are rolling their positions, but have not injected new capital into US Treasuries. That is why the Fed had to fund 80% of new Treasury debt last year.

Presently the Fed is fighting and pulling out all stops to halt legislation to audit the Federal Reserve, a private corporation, which has managed our monetary policy since 1913, under the Federal Reserve Act. On Monday the Treasury held a media conference for financial reporters and bloggers in which the Fed was discussed. The meeting had some very strange conditions. Mr. Geithner, Mr. Krueger and Mr. Sperling could be paraphrased but not quoted and what was paraphrased could not be connected to a specific official. Again, the element of secrecy to protect the guilty. One blogger said, “Did they get the ground rules from Al Qaeda?” The meeting was a travesty. How can government officials demand secrecy in public briefings? It is no wonder that 90% of the public and 317 members of Congress want more Treasury transparency and an audit and investigation of the Fed. This is the same gang run by Geithner and Bernanke that are currently running the gold suppression scheme. When you have a criminal cabal involved you have no transparency. That is why the audit of the Fed is so important. Such an exercise would expose exactly what both have been doing in the markets. The Fed and Treasury have lied for years about what they have been up too in behalf of their Illuminist friends. It is not only about the actions of the President’s Working Group on Financial Markets, but the funding of Watergate, Saddam Hussein, who they supposedly conveniently hung, the countries that secretly received loans, how much, who got them and what was the collateral? Were currency swaps with foreign control banks used to strengthen the dollar by the Fed and for those foreign control banks to purchase Treasury and Agency paper? How about all the inside information funneled to Wall Street and banking for almost a century from both the Fed and Treasury? Their lies are legion. They both are manipulating every market in the world 24/7 and the American people want it stopped. We also want an audit of America’s gold and the testing of the gold bars held. There is much we want to know, so we can save our country and our freedom.

Investors continue to chase yields, which is a dumb practice. Interest rates are at 80-year lows and can only stay the same or rise. People are grabbing junk bond yields that will come back to haunt them.

At least for now Greece and euro problems are being shuffled into the background. You can imagine this is not the last of the eurozone problems. The PIIGS will be back one by one to cause never-ending problems until they are forced to leave the eurozone. That will cause a eurozone breakup, probably by the end of next year.

This is the first real threat to the eurozone since its beginning ten years ago, and we think they will find that their rules are so restrictive that weak members will be forced to leave. The monetary policy and interest rates may be singular, but fiscal policy is not. Exchange rates for the euro must fit all members, but rates and methods of growth vary widely. With one currency sovereignty has effectively been lost. Public debt to GDP has to be under 3%, while most are over 3%: Greece is at 10.7%. There is also a public debt limit of 60% of GDP, which all nations in the zone have broken. All precepts have not and cannot be met. There is no effective policy because there is no way to enforce the rules. In addition most have current account deficits and the zone effectively has been carried by Germany from this aspect. The bottom line is a few have growth, the rest do not. As a result there is pressure, due to poor growth in some of the nations, for austerity measures to reduce fiscal deficits at the worst possible time. Greece comes first along with Ireland and the rest will follow.

Just as an example, Spain has a fiscal deficit of 10% of GDP that has to fall to 3% within three years, which is virtually impossible just as it is in Greece. Their current account deficit is 4.5% of GDP. In a recessionary/depressionary world getting into the plus column is a tall order. This dilemma is the result in part of the housing collapse caused by Spanish banks and inattention by the Bank for International Settlements. We see consumption continuing to fall in the face of 20% unemployment, which worsens by the day. The PIIGS and a present total of 19 nations are effectively bankrupt. We do not believe they can survive without devaluation and debt default. That is why we expect that to happen next year.

Historically banks have kept loan loss allowance ratios at $1.33 for every dollar of debt. Today it is 0.58%.

The commercial paper market rose $11.2 billion last week to $1.145 trillion.

The Treasury sold $21 billion in 10-year T-notes. The bid-to-cover was 3.45 to 1, which is average vs. 2.85 to 1. This was the highest since 1995. Indirect bidders, which include foreign central banks, bought 35.1%, compared to an average of 41.7% at the last four re-openings.

Almost 39 million Americans received food stamps in December, the most ever, as the jobless rate hovered near a 26- year high, the government said.

Recipients of the subsidies for food purchases climbed 23 percent from a year earlier and rose 2.1 percent from November, the U. S. Department of Agriculture said Thursday in a statement on its Web site. The number receiving the benefit has set records for 13 straight months.

Food aid climbed as the national unemployment rate reached 10.1 percent in October, the highest since June 1983, and remained at 10 percent through December before easing to 9.7 percent in January.

An average of 40.5 million people will get food stamps each month in the federal fiscal year that began Oct. 1, Agriculture Secretary Tom Vilsack said last week. The figure is projected to rise to 43.3 million in 2011.

Nevada had the biggest increase in the percentage of the population receiving the coupons, up 49 percent from December, USDA figures show. Texas had the most recipients, at 3.31 million, topping California’s 3.11 million.

The U.S. government recorded a budget deficit of $221 billion in February, the Treasury Department reported Wednesday, even as its income posted a big increase for the month.

Income totaled $107.5 billion in February, a 23% increase over last February’s total, and marking the first monthly year-over-year increase since April 2008.

Spending was $328 billion in February, up 17% year over year. That was the largest February total on record, a Treasury official said.

February was the 17th consecutive month that the government recorded a deficit. It was a little less than expected: last week the Congressional Budget Office predicted that the deficit would be $223 billion in February.

Year to date, the deficit is $652 billion, according to the Treasury data.

The Senate approved a $140 billion package of tax breaks and aid to the unemployed Wednesday, the most substantial effort by the chamber to boost the nation’s economy since passing the stimulus bill last year.

Six Republicans joined 56 Democrats to pass the “tax extenders” measure, 62 to 36. The package faces an uncertain future in the House, where Democrats have taken a markedly different approach to the “jobs agenda” than have their Senate colleagues.

On Wednesday, March 3, 2010, Congressman Paul appeared on Fox Business’ “Varney & Company” to discuss the economy and the results of out of control federal spending.

Peter Schiff is the president of Euro Pacific Capital and the author of Crash Proof: How to Profit From the Coming Economic Collapse and The Little Book of Bull Moves in Bear Markets.

The Nightmare Before Christmas
Posted by Peter Schiff on December 12, 2008

Like many pragmatic economists I have always warned that rapid expansions of government debt would result in inflation and higher interest rates. The explanation was always simple: rising supply of government debt inflates the money supply and weakens the government’s ability to service its debt through legitimate means.

But in recent months, government has flooded the market with hundreds of new Treasury obligations and telegraphed its intention to increase the deluge even more. In response, both bond prices and the dollar have risen. This benign reaction has led many to the happy conclusion that the doom and gloomers are wrong and that bailouts and economic “stimuli” can be financed with deficit spending without any adverse consequences on interest rates or consumer prices. Recent action in the foreign exchange markets suggests these hopes will prove illusory. The renewed strength in gold, together with the long over do rupture of the correlation between the movements of foreign currencies and U.S. equities, is further evidence that recent market dynamics are changing.

When the financial crisis of 2008 kicked into high gear in September, the U.S. dollar began to rally furiously. While America’s economic ship was sinking from stem to stern, its currency was becoming the must have asset for public and private investors around the world. The dollar benefitted from the positive flows that result from massive global deleveraging. Treasuries got an added boost from a reflexive flight to “safety.” As a result, politicians were able to fill out their Christmas wish lists with complete confidence that Santa would deliver. However, as these dollar-positive forces appear to be giving way, the Grinch is about make an unwanted appearance.

Last weekend Barack Obama announced his intention to implement a New Deal-style stimulus and public works program. What he somehow forgot to mention is that the United States is wholly dependent on the willingness of foreign creditors to supply the funds. But a weakening dollar makes continued foreign purchase of U.S. Treasuries a much more difficult decision.

Once the dollar begins to collapse beneath the weight of all this new deficit spending, accumulation of contingency liabilities, and the socialization of our economy, commodity prices and interest rates will head skyward. In addition, once all the going out of business sales at U.S. retailers are over, and excess inventories have been reduced, watch for big price increases at the consumer level as well.

Once the government runs out of foreign and private sector bidders for new treasuries, the Federal Reserve will be the only buyer, and the hyper-inflation cat will be completely out of the bag. Sensing this, the Fed has recently indicated a desire to begin issuing its own bonds. However, since dollars are already recorded as liabilities on the Fed’s balance sheet (dollars are in actuality Federal Reserve Notes) the Fed already issues debt. The difference now is that they are proposing to issue interest bearing debt. Perhaps the Fed feels this will make holding its notes more appealing. However, since the interest will be paid in more of its own script, I do not believe this con will work.

In the end, rather than filling our stockings with Christmas goodies, our foreign creditors will likely substitute lumps of coal. Of course given how high coal prices will ultimately rise as a result of all this inflation, in Christmas Future perhaps our stockings will be stuffed with nothing but our own worthless currency. It might not burn as well as coal, but at least we will have plenty of it.

Read more Retirement Accounts Could Boost Treasuries

Michael Maloney is a precious metals investment expert and historian and the founder and principal of Gold & Silver, Inc. He serves as an advisor on Robert Kiyosaki’s Rich Dad team and speaks frequently on commodities investing.

Rich Dad’s Advisors: Guide to Investing In Gold and Silver: Protect Your Financial Future
by Michael Maloney
“Throughout the ages, many things have been used as currency: livestock, grains, spices, shells, beads, and now paper. But only two things have ever been money: gold and silver. When paper money becomes too abundant, and thus loses its value, man always turns back to precious metals. During these times there is always an enormous wealth transfer, and it is within your power to transfer that wealth away from you or toward you.”

“It’s not so much that gold is perfect, it’s that paper is insane. To give politicians and bureaucrats and secret bankers the license to counterfeit money and create money out of thin air is destined to fail, and it has. That’s why we’ve had this financial bubble develop since the linkage to gold has been severed in 1971…

“Now they’re trying desperately to print and spend, but the bubble was overwhelming and the bursting of this bubble is something they can’t contain. It would never happen under a gold standard because there would be no legal right for our central bank to spend money and create money out of thin air. The arrogance of it all is unbelievable.

“If we continue doing what we’re doing now, we will literally destroy the dollar.”

If you can’t see inflation and perhaps hyperinflation in our not-so-distant future, you need to wake up!