An evil deed does not produce its results at once.
It smolders slowly, like a fire covered by ashes,
And finally consumes its doer the fool.
What a fool hungers for
Is false fame, authority,
Power over others, and generous offerings.
He seeks recognition as a doer,
A wielder of power,
A knower of right and wrong.
His craving and pride are insatiable.
–  The Dhammapada, Chapter 5, “The Fool”

Whoever neglects doing good
Is inviting addiction to evil.
–  The Dhammapada, Chapter 9, “Evil”

Life is easy to live for the shameless man,
Aggressive, arrogant
Intrusive, and corrupt.

Life is not easy to live for a modest man
With high values, free from attachment,
Humble, of right livelihood,
And clear vision.
–  The Dhammapada, Chapter 18, “Blemishes”

This Game is FAR from Over
Before I get into it, I want to send out a heartfelt thank you to everybody involved in this epic battle for decency in the global monetary and financial system.  Many of the people that I have collaborated with over the incredible period of my life which has been the past year were, like me, completely brainwashed about how things really worked for much of our lives.  Upon finding out the truth, we quickly understood that silence is was not an option.  Not speaking up and fighting against the cruel and unjust system in place today is the equivalent of not fighting against slavery one hundred and fifty years ago.  It is one of those cruel jokes of history that human beings are rarely able to see the gross injustices of their own times yet they look back at practices of the past with horror all the while assuring themselves they never would have accepted such behavior if they had been alive.  The truth of the matter is that most of these individuals would have likely sat obediently in silence in those eons past, not having dared to rock the boat as they just tried to “get by.”  While unfortunate, this is simply a reality of human nature.  This is why I want to say thank you to all those that refused to shut up.  Those that didn’t fear the banksters, politicians and other thugs that are systematically attempting to turn America and the world into a neo-feudalistic nightmare wrought in their sick and twisted entirely self-interested image.  Many of the people I want to thank are on this list and many are not.  I want to say thanks to Glenn Greenwald and Matt Taibbi, neither of whom I know personally.  I am signaling them out because they are what you would describe as “progressives” or people that would normally support and defend Obama and his fascist policies because he on the “blue team.”  Despite this, they have not only criticized him as harshly as anyone but have done so relentlessly in the pursuit of truth and justice.  It is very easy to stand up and yell I love the Constitution when the “other team” is in power so let’s see if the “conservatives” in this country defend liberty and the Constitution to the same degree when a “red team” player is in charge.  I suspect many of them won’t, just like many “progressives” defend Obama like mindless sheep.  This is why many in the Republican establishment are so afraid of Ron Paul.  Because he is the real deal.  See this article.

http://www.politico.com/news/stories/0211/49412.html

How about this line:  “Rep. Paul is clearly off his meds and must be purged from public office. YAF is starting the process by removing him from our national advisory board. Good riddance and he won’t be missed,” added Marks.  Notice he used the extremely charged word “purged.”  This was no oversight.  Young Americans for FREEDOM they call themselves?  Sounds like a bunch of little American Nazis to me.

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They had then learned how easy it is to issue it; how difficult it is to check its over issue; how seductively it leads to the absorption of the means of the workingmen and men of small fortunes; how heavily it falls on all those living on fixed incomes, salaries or wages; how securely it creates on the ruins of the prosperity of all men of meager means a class of debauched speculators, the most injurious class that a nation can harbor,—more injurious, indeed, than professional criminals whom the law recognizes and can throttle; how it stimulates overproduction at first and leaves every industry flaccid afterward; how it breaks down thrift and develops political and social immorality. All this France had been thoroughly taught by experience.

Everything was enormously inflated in price except the wages of labor. As manufacturers had closed, wages had fallen, until all that kept them up seemed to be the fact that so many laborers were drafted off into the army. From this state of things came grievous wrong and gross fraud.
–  Andrew Dickson White, “Fiat Money Inflation in France”, How it Came, What it Brought and How it Ended

Where the road is dark and the seed is sowed
Where the gun is cocked and the bullet’s cold
Where the miles are marked in the blood and gold
I’ll meet you further on up the road

Further on up the road
Further on up the road
Where the way dark and the night is cold
One sunny morning we’ll rise I know
And I’ll meet you further on up the road
–  Bruce Springsteen, “Further On”

 Globalization is Dead
I debated whether or not to write today.  To be completely honest I feel as if I have said as much as I can and don’t want to start sounding like a broken record.  That said, we have clearly entered the next stage in this tragic circus called the global monetary and financial system death spiral.  The final stage comes when the system consumes itself as a result of its refusal to reform and we are there now.  The fact that most people are completely unaware of it or have such strong “normalcy bias” they can’t see what is directly in front of their faces is immaterial.  It is here, it is irreversible, and it will unleash a cyclone of chaos and confusion that will leave many literally suspended in disbelief as the entire false paradigm most of humanity has lived under for their entire existence is washed away forever.

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Terrorism is the best political weapon for nothing drives people harder than a fear of sudden death.
– Adolf Hitler

Sometime around the year 2005, perhaps a few years before or after, America will enter the Fourth Turning. A spark will ignite a new mood. It will catalyze a Crisis. In retrospect, the spark might seem as ominous as a financial crash, as ordinary as a national election, or as trivial as a Tea Party. It could be a rapid succession of small events in which the ominous, the ordinary, and the trivial are commingled.

Remnants of the old social order will disintegrate. Political and economic trust will implode. Real hardship will beset the land, with severe distress that could involve questions of class, race, nation and empire. The very survival of the nation will feel at stake. Sometime before the year 2025, America will pass through a great gate in history, commensurate with the American Revolution, Civil War, and twin emergencies of the Great Depression
–  Strauss & Howe in “The Fourth Turning” written in 1997

All people who try to get elected to government are in love with government, it’s just that the Democrats are in love with one kind of government and the Republicans are in love with another kind of government, and government is going to continue to grow until there is revulsion for government.
–  Jared Dillian (he puts out a great daily piece I would look into it at http://www.dailydirtnap.com/)

The Global Revolution:  Welcome to Phase Two
When first I mentioned the food riots in Tunisia and Algeria in my note two weeks ago the former authoritarian leader Zine al-Abidine Ben Ali had yet to flee to Saudi Arabia with much of his nation’s gold.  What I find so amazing about this whole situation is why someone in their right mind would take the time to take some shiny little element that is in a bubble and that you can’t eat in the chaos surrounding one’s escape to another nation.  Surely he has hidden foreign bank accounts and since gold is just another “fiat” currency according to a Wall Street strategist, why bother?  He must be some right-wing radical that likes the Constitution and is therefore anti-American.  Isn’t that right Mr. Potok?

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The people must be helped to think naturally about money. They must be told what it is, and what makes it money, and what are the possible tricks of the present system which put nations and peoples under control of the few.
– Henry Ford

U.S. investors should welcome, not fear, climbing commodity prices.  The increases are “largely a reflection of the fact that the pace of economic growth, particularly in the U.S., has picked up,” said Nariman Behravesh, chief economist at consultants IHS in Lexington, Massachusetts, and a former Federal Reserve official who has been covering the global economy for more than 35 years. “It’s not something to be worried about.”
– Bloomberg article from yesterday

Why Fiat Money is Immoral
Today’s email is going to be a little different.  A couple of weeks ago a friend of mine from NYC who is not in the business but is on my weekly email distribution list asked me to explain fiat money and why I think it is the wrong way to go.  Below I am going to paste my response to her.  There is so much disinformation out there about money it is scary.  Sadly, the strategist at my former employer added to this several weeks ago.  He wrote:  “Gold, which is effectively just another fiat currency.”

Clearly he failed to look up the definition of fiat currency.

Fiat money is money that has value only because of government regulation or law.

Definition of Fiat:  An authoritative or often arbitrary official order or decree.  THIS DOES NOT EXIST TO GOLD AS MONEY TODAY AT ALL.

Gold is not money under “fiat” in any country at the moment.  Rather the market is making gold as money today which is the OPPOSITE of fiat money.

With that off my chest, here is the response to my friend…

Ok, so let’s do a brief thought exercise on why I believe commodity money is preferable to fiat money.  When you have fiat money, a government, or in the case of the United States today, a banking cartel (the Federal Reserve), is granted exclusive authority to create the nation’s money.  Laws are used to enforce the use of this money otherwise people probably wouldn’t use it.  Under a commodity money system, where let’s say the U.S. issues dollars but those dollars are backed or convertible to a commodity (in many cases gold but it can be other things) there is a limit to the amount the government or banking cartel can print or issue and this is in relation to the amount of the commodity that exists or is available to the government or central bank.  The current propaganda that is rife throughout economics textbooks and the like tell is the notion that commodity money is bad since it stifles human innovation in relation to the amount of gold or whatever commodity used.  They say this is bad and that there should be no “limit” on money creation based on something as arbitrary as a commodity and that this is bad for growth.  This is complete nonsense and is used to keep people in the current fiat system where money power is exercised most egregiously by the few against the many.  The reason they defend the current system is simple.  With the power to create unlimited currency at will (via the Federal Reserve) you possess total and absolute power over almost EVERYTHING in the economy and society at large.  The Fed not only creates the money but they distribute it where they want.  In QE1 and QE2  they decided to buy specific assets.  In the case of QE1 where they bought toxic assets, this was just another bailout of the banks and others that made poor investment decisions.  Did the money go to build new schools?  No.  Did the money go to build high speed trains as is done in China?  No.  Did it go to building out massive alternative energy infrastructure?  No.  It went to save the banks because at the end of the day the Fed exists as a backstop to the banks and it is to the banks that the Fed answers to at the end of the day.  It is a brilliant scam that 95% of Americans do not comprehend.  So in this case all of the money is going to the banks (which destroyed the global economy in the first place) and other players in the financial world.  Remember, the banks ARE the Fed and the Fed creates the money.  Gate keepers at the Federal Reserve and academia make understanding economics, the Fed and money seem so “complex” but the scam is really VERY simple.

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Death may come invisible, or in the holy wall of fire
In the breath between the markers, or on some black I-80 mile
From the madness of the government, to the vengeance of the sea
Everything is eclipsed by the shape of destiny
– Conor Oberst/Bright Eyes, No One Would Riot for Less

2010 Recap:  Macro Trends Playing Out as Expected with Some Surprises…
Heading into 2010 I focused on three investment areas that I thought would benefit the most from the insane policies of desperate global Central Banks and governments adhering to the orders of the financial oligarchs that control them.  They were to be long precious metals, agricultural commodities and oil.  Not only was I a believer that most globally traded “hard assets” (as opposed to residential real estate) would do well as global fiat currencies are competitively devalued, but I thought that the three subgroups mentioned above would do particularly well since they are also strategic commodities.  Basically, in a world going through the type of dangerous geopolitical shift we are in at the moment (these happen once in a generation and are called “Fourth Turnings” by Neil Howe and William Strauss) governments and in fact all institutions become subject to upheaval and revolution.  Since governments are made up of human beings (generally narcissistic power hungry ones) we can generally forecast how they will react to such tension.  In their attempt to maintain power and status governments usually do one of two things.  They turn on their own people (or minorities within their own societies) or they turn the anger of the populace on a foreign enemy.  In an environment where the global financial system is based on digital monopoly money created with a keystroke by Banana Ben and company, money itself will become suspect and any large foreign government with even a basic understanding of money matters will buy all the gold they can so that if necessary they have real money to use the basis for a new currency if necessary down the road.  Just as gold is a necessary hedge for individual Americans that can see the destruction of currency values by their own government, it is too a hedge for China, Russia and others against their U.S. dollar reserve assets and indeed the global financial system to which they are a major participant.  Agricultural commodities are just as important since if a nation like China cannot provide food at a reasonable cost to its citizens there will be revolution overnight.  In fact , this is true in any nation.  Oil fits in to the equation as a hedge if the whole thing breaks into global warfare which can occur once a nation loses the financial war happening now.  If you don’t have access to enough oil you will lose any major conflict.  Why do you think we are in the Middle East and are looking for an excuse to attack Iran?  To spread Democracy?  Don’t make me laugh.

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vam·pire
noun ˈvam-ˌpī(-ə)r

Definition of VAMPIRE
1: the reanimated body of a dead person believed to come from the grave at night and suck the blood of persons asleep
2 a : one who lives by preying on others

Does the above definition of vampire by Merriam Webster remind you of anything?  Yes of course it does, it reminds you of the Too Big To Fail Banks.  It was extremely appropriate for Matt Taibbi to refer to Goldman Sachs as the “Vampire Squid.”  Just as the above definition lays out, vampires are able to come back from the dead and once they have done so they drain the life out of the living while they sleep.  Need I say more?  The big banks and the Federal Reserve are modern day vampires and they are feeding off what remains of the living (productive) parts of the economy while the majority of Americans are stuck in a reality tv, Prozac induced coma of endless propaganda and brainwashing.  Indeed the vampires are feeding off of an American public that still by and large remains “asleep.”  These are ideal hunting grounds for vampires.

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The man who has begun to live more seriously within begins to live more simply without.

Every man’s life ends the same way.  It is only the details of how he lived and how he died that distinguish one man from another.

There is nothing to writing.  All you do is sit down at a typewriter and bleed.
– All Quotes by Ernest Hemingway

The Biggest Trade of My Life

If all goes according to plan the next time you hear from me I will be settled in my new home of Boulder, Colorado.  This is a huge move for me as I have essentially spent my entire life aside from college and a semester in Spain living in NYC.  When I resigned from my prior job in January of this year I didn’t know what to expect.  I was taking a huge risk walking away from a very comfortable life and income.  Nevertheless, I knew that stage in my life had run its course and it was time to open my life up to other possibilities.  More than anything else I wanted to see how I would feel and what would happen if I just let all the things that were tying me down fall away and experience total personal freedom in every way imaginable.  What has happened is that I have just lived the most fulfilling year of my entire life.

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An end to “banking as we know it” is fine with us.  The “banking” in today’s Western economies is simply a monopoly-distribution point for the dissemination of fiat currency.  Central banks have got to distribute money through banks because the alternative – simply distributing it to people – would reveal the scam for what it is.  By filtering the money-printed-from-nothing through banks, the process retains a mysterious quality.  It is also rendered more complex, which is necessary when one is promoting a Ponzi scheme.  Finally, bank distribution allows for a debt add-on that further controls the process.  The situation is incredibly destructive, ruinous and benefits, essentially, on a very people who are the most direct beneficiaries of central bank funding stream.

– The Daily Bell, Staff Report
http://www.thedailybell.com/

The Giant Cover Up
Much has been written about QE2, too much really.  However, today I want to take a step back and look at it from another angle.  QE2, or the latest round  of Federal Reserve quantitative easing is in all reality just a move of extreme desperation by what Max Keiser appropriately calls “financial terrorists” to cover up the recent coup d’etat of what was left of America’s wealth by special interests across the spectrum from politicians themselves, the military industrial complex and crucially the big Wall Street firms that gamble with taxpayers money all the while calling themselves banks.  At the center of the theft is and continues to be the Federal Reserve.  Using the financial collapse of 2008 as a smoke screen, the totally bankrupt large Wall Street firms using their puppet ex Goldman Sachs CEO and then Treasury Secretary Hank Paulson sufficiently scared our politicians to give them unlimited sums of money, suspend accounting for their bad assets and then go right back to gambling again and paying huge bonuses all the while never accounting for their assets at market value.  The hope from the perspective of the Federal Reserve has been that by pumping virtually unlimited amounts of newly printed money into the banking system (which is what quantitative easing is) they could create another fake Keynesian economic boom that would get people back to work and back to sleep again.  Housing prices would start rising again and none would be the wiser until the system collapsed again a few years later (which it would be guaranteed to do) but then it would be much too late to stop it.

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