In last nights update resistance in gold was listed at 1437.50-1446 and the high so far is 1439. Support for today was listed at 1419-1425 and the low so far is 1427.60

London Gold Fix $1432.50 +$1.50 LME

While the Dollar is slightly higher early, the Greenback remains within striking distance of last week’s lows. With the gold market overnight seeing a rather hot ECB inflation reading and seeing crude oil prices claw out another fresh new high for the move and a host of commodity prices trading higher, the gold bulls feel somewhat confident to start the new trading week.

Some players in the market expect some dovish comments from the Fed’s Bernanke today and after dovish dialogue from the Fed’s Dudley at the end of last week, the threat of rising US rates may become an issue but so far — it seems to be just talk. There is a G20 meeting mid-month so that’s something we’ll have to keep in mind.

Some players think that news of a release of RAD into the ocean in Japan is a limiting issue for gold, but one could also suggest that development could ultimately be inflationary if Japan is forced to seek alternative protein in the grain and livestock markets.

The Commitments of Traders Futures and Options report as of March 29th for Gold showed Non-Commercial traders were net long 213,983 contracts, an increase of 3,448 contracts. The Commercial traders were net short 264,085 contracts, an increase of 1,242 contracts. The Non-reportable traders were net long 50,103 contracts, a decrease of 2,205 contracts. Non-Commercial and Non-reportable combined traders held a net long position of 264,086 contracts. This represents an increase of 1,243 contracts in the net long position held by these traders.

While equity markets in Asia and Europe were mixed during overnight trading, early indications are for the US stock market to open today’s session with moderate gains.

The Bank of Japan’s Tankan survey of Japanese manufacturers projects that business conditions in Japan will worsen during the next three months as a consequence of the Sendai earthquake.

A Libyan envoy has traveled to Greece to begin discussing an end to hostilities in that nation. The US State Department is flying their employees out of Syria due to continued unrest.

Euro zone PPI during February was up 6.6% year-on-year, in line with market forecasts.

Going to the charts ……………..

On Friday’s update we discussed the tendency for gold to move higher after the USA unemployment data and after hitting a low of 1412, gold rallied back to the 1430 area for the close.

Coming into today and the 1439 high — it really comes down to whether gold is going to burst through the 1444 area this week. A WEEKLY Friday close above 1436 — and 1444 is needed to add to the upside potential. Although the trend is still up — the stronger trends we watch are due to peak here between today and Wednesday and a weaker trend is scheduled to begin and last into mid-month. Price always rules — and turn points are secondary — so we would want to see price begin to react and show weakness before we consider that the weaker trend has kicked in. But it’s something we need to be aware of should gold begin to trade lower. First Targets for this coming week to watch for is the 1440 to 1453 area. I’m looking to sell 1/2 my long short term gold positions from 1406 and 1418 should we trade up to the 1450 area.

The chart shows two red arrows —- the lower arrow shows the Feb lows how the market pulled back to 1325 on four occaisions in one week but was not able to break lower. The same condition happened last week — where there were four pullbacks to the 1410-1412 area — all of which produced a nice bounce back up. The lows were right on the lower purple channel line on the chart. This kind of action usually favors higher prices.

Thus, from a swing trade standpoint — as long as we remain above the 1408-1410 price area on a closing basis — the trend is still up.

Resistance is the 1439-1447 area today and first support is the 1427-1432 area.

In summary — the gold market trend is still up. A daily close above 1436 and/or 1444 would be helpful and favor higher prices into Tuesday/Wednesday. Going forward —- as we mentioned — the potential for gold to peak this week and begin a sideways to lower trend into mid month is a consideration when we look at short term cycles. However the seasonals do favor higher overall into the month of May so an April pullback — should still garner higher prices into month end and early May should we get a pullback. The trend is still up.

by Bill Downey

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Here at Goldcoin.org we have previously discussed the moves in Utah to introduce its own gold currency, Gold currency is making a comeback! In Utah, they could soon be buying a hamburger with gold! and noted that progress was made by the passing of a bill in Utah Gold Currency a step closer.
However, Utah is not alone.

There are no fewer than 12 other States which are pushing for a return to gold currency by introducing bills before the Legislature in the form of the ”Constitutional Tender Act”.
The 12 States are:
Colorado
Idaho
Indiana
Montana
Missouri
New Hampshire
North Carolina
South Carolina
Tennessee
Vermont
Virginia
Washington

The “Constitutional Tender Act”

The United States Constitution declares, in Article I, Section 10,
“No State shall… make any thing but gold and silver coin a Tender in Payment of Debts”. This means that no State can make something a “tender in payment” (which means they cannot “make something an offer as payment”) for any debts, which would include debts owed by and to the State.
However, EVERY State in the United States of America HAS made some other “Thing” an offer as payment – they have by law declared that they will accept, and pay out, Federal Reserve Notes for any debts owed by or to them.
Therefore, every State is in violation of Article I, Section 10 of the U.S. Constitution.
Thus the need for the “Constitutional Tender Act” — a bill template that can be introduced in every State legislature in the nation, returning each of them to adherence to the United States Constitution’s actual legal tender provisions.

Most importantly the bills are aimed at protecting the people from the continued devaluation of the dollar and almost certain hyperinflation which is due in the future.
It is also seen as a way for States to insulate themselves from the policies and practices of the Federal Reserve which seems to be pursuing the inflationary practice of monetizing the national debt to address the consequences of runaway federal spending.

The Privately Owned Central Bank

Did you know that the Federal Reserve is a private institution with link shareholders? Most folk believe it is a federal agency.

Fed shareholders earn 6% interest “by law” and as for reserves, well they have none. The only thing the Fed does is create paper and charge the government interest for doing so. It also has licence to print “paper money” that is not backed by assets. The more it produces the more the value of the dollar is diluted. The $800 Billion it has printed for QE2 are merely bits of paper with ink on them that eventually some average Joe will be charged interest for using or borrowing. In reality the money doesn’t exist just the debt it creates.

Individual states have not issued legal tender for over a hundred years so why now?

Because the weakening of the dollar by the Fed to essentially reduce the size of the national debt has also eroded the savings of citizens, the price of their houses, the worth of their pay cheques and eroded their purchasing power at a time when inflation is rising but wages are stagnant. Enough is enough.
History is on the side of the people here. In the original drafting of the Constitution the Founders disliked “paper” money so much they provided specific wording against it.
The transcript of the debates in the original Constitutional Convention shows the attitude of the Founders toward paper money was one of disgust. In debate one delegate, Roger Sherman, called for the insertion of an absolute prohibition against states issuing their own paper money.

Mr. Wilson and Mr. Sherman moved to insert after the words ‘coin money’ the words ‘nor emit bills of credit, nor make any thing but gold and silver coin a tender in payment of debts’ making these prohibitions absolute…

Mr. Sherman thought this a “favourable” crisis for crushing paper money.

The Founders voted to adopt Sherman’s “crushing” of state-based paper money.

As for the federal government, the original draft of the Constitution included language permitting the federal government to issue unbacked paper money. The Founders objected strongly to this power. The objections were summed up by delegate Oliver Ellsworth:

Mr. Elsesworth thought this a favourable moment to shut and bar the door against paper money. The mischiefs of the various experiments which had been made, were now fresh in the public mind and had excited the disgust of all the respectable part of America. By witholding the power from the new Governt. more friends of influence would be gained to it than by almost any thing else. Paper money can in no case be necessary. Give the Government credit, and other resources will offer. The power may do harm, never good.

Those who wrote the Constitution decisively stripped the federal government of the power to issue inconvertible paper money. And stripped it stayed… until, temporarily, during the Civil War. Saving the Union was of transcendent importance.
For most of American history dollars were convertible into gold or sometimes silver.
It is a 20th century innovation to have unconvertible money

On April 19 1933 Franklin D Roosevelt took the US off the Gold Standard and Americans had to exchange their gold for paper dollars at $20.67 an ounce (so a dollar was approximately equal to 1/20th of an ounce of gold). This was the start of the Great Confiscation which lasted until 1975.
In 1945 The Bretton Woods Agreement created a “Gold exchange standard” whereby the US promised to fix the price of gold to $35 an ounce (the dollar therefore was worth 1/35th of an ounce). The dollar therefore became the world’s reserve currency and was used for international trading and commerce, notably for the quotations of oil. Therefore all other currencies were effectively pegged to the dollar and therefore gold. At this point “paper” money had a reference value and theoretically could be exchanged as originally intended for a specific weight in gold.

However, in 1971 Richard Nixon suspended the convertibility of the dollar into gold because of the huge US debts following the Vietnam War. This was another nail in the dollars coffin. The gold price was approximately $41 an ounce ( so a dollar was worth 1/41th of an ounce). This also effectively unhinged all the other currencies from a gold standard as they had all been pegged to the dollar. The Demonetization of gold was completed by the Jamaica Agreement. This meant currencies could freely float in value up and down which they did. It marked the first time in history that only Fiat currencies existed (i.e. unbacked currency).
President Nixon announced this as a temporary suspension.

Nixon Lies again and again

President Nixon made certain promises to America when he suspended convertibility of the dollar. August 15, 1971:

“I have directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold ….

Now, what is this action–which is very technical–what does it mean for you?

Let me lay to rest the bugaboo of what is called devaluation.

If you want to buy a foreign car or take a trip abroad, market conditions may cause your dollar to buy slightly less. But if you are among the overwhelming majority of Americans who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today.”
The dollar has actually lost 3848% of its value when measured against Gold since Nixon declared this.
An ounce of gold is today quoted at $1420 (rounded up) which means that a dollar is technically only worth 1/1420th of an ounce compared to 1/41th of an ounce when Nixon made his declaration.
This steady erosion of the worth of a Dollar is exactly why there are calls for a return to gold currency or gold-backed currency in 13 States with others already contemplating the same.
One can understand the concerns and the choice between paper dollars or a piece of gold to preserve your wealth seems self-evident.
Just in case let’s check the value of the Dollar expressed in Gold.

Value of US Dollar expressed in Gold (ounces)
1933	1945	1971	2011
1/20	1/35	1/41	1/1420
0.0500	0.02857	0.02439	0.00070

From Confiscation until Bretton Woods 12 years later the Dollar lost 175% of its value against gold (an average of 14.58% per annum).
From Bretton Woods created the standard until Nixon removed it 26 years later the Dollar lost 117% of its value against gold (an average of 4.5% per annum).
In the last 40 years since Nixon unhinged the Gold Standard, the US Dollar has lost 3484% of its value against gold (an average of 87.1% per annum).
In a total of 78 years since confiscation in 1933 the US Dollar has lost over 7142% of its value against Gold (an average of 91.56% per annum).

So the period of greatest stability for the Dollar was with a Gold Standard and Confiscation still in place.
The most unstable period for the Dollar was when neither of these was in place as is the case today.

If the Dollar continues to falls by at least the average for the last forty years, bearing in mind that current world events could add to its woes, then it would be worth 0.00009 ounces of gold or 1/11111th of an ounce within a year – that gives a gold price of $11,111 an ounce.

It is especially pertinent when one considers the strength of an investment over time – Gold is anti-inflation and anti-crisis. It will always maintain real value, worth and purchasing power which can be traded and wilfully accepted in exchange for the necessities of life. This cannot be said for paper money which as history has proved time and again eventually becomes a worthless piece of paper whose only real value is its calorific heat value for burning!
This illustrates exactly why the peoples of Thirteen States are leading the charge to convert to a gold currency that maintains real value rather than be chained to the US Dollar which will only be of value for fire-lighting very soon.
It is inevitable that currency must be established against a fixed reference for it to have any real value and this road will always lead back to Gold as history has proved.
If you’ve never bought Gold before then maybe now is a good time before your savings literally go up in flames.

No-one has a crystal ball to look into the future. However, this did not stop Rob McEwen, Chairman and Executive Director of Minera Andes and US Gold Corporation, from voicing any doubt in his belief that if the current trend continues the price of gold might reach $5,000 an ounce over the next three to four years.

McEwen based his predictions on the constant demand for gold from sovereign states, central banks and investment funds which are quoted on the stock market. Moreover, he justified this time frame and the forecast of $5,000 based on the historical price of metal and the ratio for the Dow Jones share gold index since 1970.

“Gold is used as an insurance by poor governments”, stated the executive during a mining conference being held in Hong Kong. What is certain is that no-one is in a position to say that McEwen does not put his money where his mouth is: this businessman has ensured that some 90% of his own personal assets are deposited in physical gold and he added that he owns a 31% shareholding in Minera Andes and 20% in US Gold Corp, both based in Toronto.

Currently the price of gold is over $1400 an ounce owing to the fear of investors about the situation in Libya and Japan. Since last year, the doubts caused by a global economy not managing to recover from the international financial crisis which broke out in 2008, has made gold into the asset preferred by investors who are looking to get out of “paper money”.

In these times, the economic uncertainty has become more accentuated owing to the risk of default by Portugal which is in the middle of a political and economic crisis which has led to the fall of the Prime Minister José Sócrates. According to some European sources, the financial rescue of Portugal will cost in the region of $100 Billion.

Last nights website update listed resistance at 1437-1446 and the high so far is 1436.50 — support was listed at 1419-1425 and the low so far is 1413.

The big factor supporting gold recently has been inflationary expectations, which were given a boost yesterday by strong rallies in grains and livestock as well as ongoing strength in crude oil. Comments yesterday from the Wal-mart CEO that consumers face “serious inflation” seemed to be laying the groundwork for higher retail prices ahead.

With a new month — and a new Quarter — the Media is really spinning the data of a US economic recovery as the new hires came in at a plus 212K this morning. The spin of course is that the feds are going to be able to stop printing and supporting the economy……….and to carry it further, they will also begin to talk tough on how they are going to curb inflation — when in fact they are the reason for inflation. Media is spinning that the stock market had its best quarterly gain in 13 years, and manufacturing is having a great year and the unemployment rate is going down. This spin of course is to lead the market to one conclusion — that the feds could increase interest rates…………….to which we say………….. not at the moment.

Underneath it all —- the US Dollar — has rallied very strong against the yen again this week in what must be considered intervention. But it has been enough to rescue the dollar from its precarious position on the charts.

The news has produced a hard sell off in the metals so far this morning. One item we discussed last night was that the short term stronger cycles were due to peak between today and this coming Wednesday. But since the Metals usually exhibit strength at the beginning of a new month — the key now will be to see if Gold can stabilze here and regain it’s composure going into today’s close. This has also often occured on these report days for the metals so it is not out of the question for gold to bounce back as the day wears on — and is another factor we discussed in last night’s update.

Going to the chart — we can see that today’s sell off was once again a 4th TEST of the 1410-1412 area and another hit on the lower purple channel line.

Perhaps more important is the failure for gold to have closed above the 1436 area we’ve been watching for. This remains an important price point. Support is the 1410-1415 area for the remainder of the day —-and resistance is the 1423-1429 area and then 1436.

In summary — a bounce back from the lows is underway — and if gold can remain firm and push up into the close it will keep the trend up. Any close below the lower purple line will put the upside in question.

From a historical standpoint — short term trends are due to peak in the first week of April — and last into mid month. Closes below the lower purple channel line will add to that potential. We’ll pick it back up next week. Lets see if gold can push back up as we move into the close. As long as we remain above the purple channel line — the trend is still up.
What we want to see now — is a strong finish for the metals.

by Bill Downey

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In last nights update resistance was listed at 1427-1434 and the high so far is 1439. Support was listed at 1409-1417 and the low so far today is 1420.20

London Gold Fix $1431.00 +$12.00

With the US Dollar down this morning and oil up sharply, commodities have gotten a lift but the gold market also rose off the World Gold Council’s 2010 Indian gold consumption peg of 963 tons, and of a longer term demand forecast for India from the World Gold Council that pegged demand to reach 1,200 tons by 2020.

While the gold market has benefited from talk of favorable Indian wedding demand, evidence of a huge wheat crop and a very large sugar crop, coupled with extremely high historical prices for those crops, probably increases the purchasing power of a noted portion of the agrarian population in India. With the World Gold council also suggesting that Indian demand for gold will rise 3% annually for the next 10 years on the idea of strong Indian gold demand.

Iit is also possible that gold prices will took direction from a USDA grain report, which suggested bullish prices for Corn and Soybeans.

A report out at 11:30 pm est today on Ireland banking is being awaited by the markets.

The Feds had to release data on who received all the discount window lending. Over 900 pages have been released. This should be ripe discussions over the next few days.

Going to the gold chart — yesterday’s price pullback finally touched the lower purple trendline and for the third time this week — the lows were established near the 1410 area. Prices remained firm all night setting their lows in Asian trade and price has been rising in quick bursts with stair step consolidations since the London session. Resistance for the remainder of the day is the 1440-1444 area and support is the 1427-1430 area.

In summary — the trend remains up — a close above 1444 would increase potential of higher prices into early next week. A close above 1436 would also keep things positive going into Friday.

by Bill Downey

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We have previously reported at Goldcoin.org in Chinese queue at malls to beat Bernanke’s inflation with gold that the a Chinese Gold rush is underway from investors who are looking to beat inflation and devaluing currencies by buying and hoarding gold bullion and gold coins.

In January 2010, China recorded an inflation rate of 1.5%. But just 12 months later, the rate of Chinese inflation has climbed to 4.9%.

Rising inflation has sent food and property prices in China skyrocketing.

The price of food in China has increased 10.3% on an annual basis. The price of grain rose 15.1% and fruit prices were up 34.8% since January of last year.

Chinese inflation has been fuelled by an economic stimulus during the financial crisis two years ago of $585 which has resulted in excesses of liquidity in the economy.

The Chinese Government has tried to curb the inflation with measures such as raising interest rates several times and tightening lending requirements but so far this hasn’t worked. Even worse is the fear sweeping through the Chinese economy that inflation could go out of control and even lead to hyperinflation.

This has already prompted Chinese citizens to buy gold and their appetite for the yellow metal is insatiable.

This trend is not only set to increase but possibly explode into action following recent reports that the People’s Bank of China (PBOC) is actively recommending that over 1 Billion Chinese citizens buy gold as a way of preserving and protecting their wealth against inflation, economic crisis and the falling values of major currencies .

This recommendation was given in the Financial Markets Review from the PBOC and its publication coincided with the decline of several major currencies against the value of gold notably, the Swiss Franc fell 2.5%, The Japanese Yen 2%, The Pound Sterling 2% and of course the US Dollar  which fell 1%.

Chinese buy almost half the Gold produced in the world

According to the gold-specialising Swiss Bank UBS the Chinese demand for gold in the first 2 months of 2011 exceeded  7.05 Million ounces.

This unbelievable demand is the equivalent of 47% of all gold produced in the world during the same period. So the Chinese are buying almost half of the world’s gold production.

If this continues then the Chinese are set to buy in excess of 42.3 Million Ounces of Gold this year!

To put this quantity into context it is more gold than China’s Central Bank officially stores in its reserves.

The Financial Times recently quoted a senior executive at the Industrial and Commercial Bank of China ICBC, who spoke of the “voracious” appetite for gold in China…

China’s largest bank started a physically-backed gold savings account in December with the World Gold Council. Account openings have already surpassed 1 million, with more than 12 tonnes of gold already stored on behalf of investors.

Zhou Ming, deputy head of ICBC’s precious metals department, said the nation’s largest bank sold nearly 250,000 ounces of physical gold in January — the equivalent of 50% of all the bullion ICBC sold last year.

Added to this is the continuing diversification out of Forex by the People’s Bank of China into gold and other precious metals. They have around $3 Trillion which they would like to change because the weakening dollar is eroding its real value. How much gold will they need for $3 Trillion?

We know that China has been accumulating gold surreptitiously by buying up its own domestic production.

This suggests that increasing gold production was part of a long-term strategic plan to become a global leader in gold investments among governments.

The World Gold Council even reported:

Some market participants believe that China may also be continuing to buy local mine production, which it has done regularly in the past. There is certainly no shortage of experts, both domestic and from overseas, advising China to do so.

The World Gold Council estimates China’s gold demand could double in 10 years as more investors embrace precious metals.

But even in the short term, the expected demand for gold in China over the coming month will be enough to put significant strain on global supplies.

According to Tom Bulford  “China has spent the last decade buying every ounce of gold it can lay its hands on.

In fact, the Chinese have increased their deposits by 1,054 tonnes since 2001.

That’s 76% more than it was buying just a decade ago!

And it’s not just the Government we’re talking about here.

Ever since private gold ownership was legalised in China…and the Shanghai Gold Exchange opened – regular Chinese citizens have also started buying up gold in a BIG way”.

Quite simply, the Chinese seem to want to buy ANYTHING gold…

…gold coins…gold bullion…even foreign gold miners.

In fact, according to Want China Times…

“Chinese state-owned gold miner China National Gold Group announced… that it will step up overseas mergers and acquisitions in an effort to increase its gold stockpiles by 100 tonnes this year.”

Chinese production figures

China Produced $35 Billion in Gold in 2010

According to China’s Ministry of Industry and Information Technology, gross output from domestic production increased 67% to 230 billion yuan ($35 billion) in 2010.

Of this, China’s gold industry earned 5 billion yuan ($3.8 billion) in profit — 78% more than in the previous year.

China’s gold mines produced 9.9 million ounces of gold in 2010 — an increase of 7% over 2009.

Meanwhile, total domestic gold output grew 9% to 12.0 million ounces. (source WGC)

India is also encouraging Gold acquisition

Traditionally there has always been a strong demand for gold in India  with its specific seasonal demands for weddings and a cultural attachment to jewellery. However, they are also strengthening demand in Asia which is fast becoming the most important Continent for gold investment.  Gold is selling extremely well to the ordinary citizens looking for wealth protection and preservation. There are over 460 Post Offices that sell gold direct to the people. India also has public companies that offer credit to anyone wishing to purchase gold – in other words you can get a loan to buy gold!

This incredible demand throughout Asia is sure to impact the price of gold which may not have been factored in to the so-called expert calculations/ predictions/guesses.

Gold Price set to go skyward with Asian demand and World events

Similarly there are other significant factors that cannot have previously been factored in to annual gold price predictions such as;

• The continuing European Sovereign debt crisis with Portugal the latest Eurozone country in difficulty,
• The on-going Japanese catastrophe following the Earthquake, Tsunami and nuclear crisis,
• The popular uprisings in North Africa and around the Middle East with Syria and Yemen on the brink and the conflict in Libya worsening by the day. This has drawn military (and therefore financial)  resources from France, the UK and the US which have their own deficit problems and now has involved NATO countries.

It is becoming increasingly difficult to see how all of this can be paid for or accommodated in a World Economy already faltering.

It is no wonder that the Chinese are hedging against another crisis and with their ever increasing hoards of gold they are aiming to back the Yuan with gold and ultimately replace the Dollar as the world’s reserve currency.

We are heading for a spot of $1500 within weeks – and then…..$3000+

In view of the colossal demands for gold already discussed, the possible collapse of the dollar and the unknown outcomes of other world events a crisis bigger than 2008 looms large and we cannot predict which event will trigger it but be sure that it will happen. When it does make sure you have copied the Chinese and secured your wealth in the only safe haven for the crisis ahead. Buy Gold and buy now before the price takes off exponentially surpassing $2000 and even £3000 an ounce before the end of the year. The worthless dollar, hyperinflation, extraordinary demand and debt crisis dictate the course of gold to re-establish itself as the only real measure of currency and wealth. When the dust settles and re-evaluations have been made just pray you have gold as it will be worth upwards of $3000 an ounce.

In last nights update resistance was listed at 1422-1428 and the high so far today is 1430. Support was listed at 1406-1413 and the low so far today is 1414.30

London Gold Fix $1419.00 +$5.00 LME

The gold market dipped last night to daily support at 1414 on forecasts from Gold Fields Mineral Services predictions of increased gold production in 2010 but the gold trade hasn’t been overly focused on the supply side of the equation. In fact, the gold trade generally thinks that investment and demand are easily poised to outdistance increases in supply. Gold Fields Mineral Services pegged world gold production in 2010 to have increased by 3%, with China contributing a gain of 6% and Australia contributing a somewhat shocking expansion of 16%.

While today’s gold upmove began shortly before he payroll reports, there is still a bit of caution of upcoming Fed dialogue, which this week has clearly tended toward a hawkish bias. For now, it sounds more like talk than action. Some traders are suggesting that the knock on impact of the Japanese disaster has already tempered prices and will in turn slow upcoming numbers throughout the world and that Fed tightening expectations are premature. With 3 US Fed members scheduled to speak during the trade again today and with unemployment reports due tomorrow, it is possible that metal prices will remain in the 1420-1430 area for the remainder of the day.

Monthly Japanese auto production readings showed a decline of 5.5% last night. Overnight the wires from North Africa suggested that the Libyan forces regained ground against the rebels.

Going to today’s chart — today’s push to 1430 has at least put us back above the 1420’s and currently trading near the 1425 area. End of month and beginning of month usually favors the upside in the metals so the upside is still favored into next week. The next big event will probably be the unemployment data on Friday. The potential for gold to remain in the 1420-1430 area until then has potential. Resistance for the remainder of today is the 1430-1435 area. support is 1419-1422. The next key area’s to wach would be a close above 1436 and 1444 as this would be suggestive that the upside still has the advantage. Trends are favored higher into next week.

by Bill Downey

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In last nights website update resistance was listed at 1426-1434 and the high so far today is 1422. Support was listed at 1406-1413 and the low is 1410.90

London Gold Fix $1414.00 -$6.00 LME

Gold prices appear to have come in from over seas action on a slightly weaker footing. Apparently prices for gold related items in Japan continued to slide overnight and that could be the uncertainty of the Japan crisis.

Indian gold prices were also softer in the wake of weakness in a host of commodity prices in the US on Monday. Some gold players probably saw the hawkish dialogue from US Fed members speaking in Prague this morning as a negative, while others might have noted some residual concern within the Fed for the “Four” uncertainties facing the market. The Fed’s Bullard suggested that macroeconomic uncertainty was on the rise over the last few weeks because of Japan, the Middle East, the Euro zone debt crisis and also because of the US fiscal situation.

Last week, the gold market seemed to draw support from evidence of weak US economic readings, as that fostered some talk of an extension of easy money policies. While somewhat hawkish dialogue from the Fed over the last 24 hours might temper the impact of weak US data on gold prices, the trade should still take a long look at the reaction in gold prices to the Consumer Confidence report and the Case-Shiller home price survey this morning as both of those reports are expected to be soft.

The Dollar is higher against most of the major currencies during overnight trading. A Regional Fed President said that the US Fed may start to normalize policy before global uncertainties are totally resolved. Western and Middle Eastern nations will meet in London today to plan for a post-Gaddafi Libya. Japanese officials have found traces of plutonium around the damaged Fukushima nuclear power plant.

From a chart perspective — the inability of gold to close above 1444 last week continues to exert pressure on prices again this morning. Last nights high at 1422 kept gold inside the trading range we’ve been in for the past five months. Today’s lows have retraced back down to yesterday’s price range near 1410. This adds additional pressure on yesterday’s reversal back up. Support is the 1405-1410 (purple line) area and 1390-1398 where the dotted trend lines are.

Price needs to close back above the 1425 level as a minium to reverse the pullback that began last Thursday. The 9am to 10:30am EST timeframe needs to be watched carefully today.

by Bill Downey

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In last nights website update support in gold was listed at 1418-1423 and 2nd tier support was listed at 1406-1412 and low so far is 1410.

London Gold Fix $1420.00 -$14.00

There are a number of cross currents going on in gold this morning. We’ve been looking for a pullback into today due to options expiration in gold — and the rollover from April gold into the June contract. Both of these factors seem to have played out as gold and silver are lower. Another factor we’ve been watching is the US dollar and the key uptrend line that is hovering at. Over the past three days the dollar has been able to climb back above 76 – and that area needs to be watched.

Gains in the Dollar overnight has added to the bears the initial edge this morning. One of the “stories” being floated is that Kadaffi will have to sell some of his gold to support his effort. We think the story has no legs — but it does add to the “spin” that the desperate shorts seem to be trying to expouse.

While the gold market hasn’t paid that much attention to supply side developments lately, news of higher Russian gold production for the first two months of 2011 has contributed to the slightly weaker price bias early this morning. The Russians saw their two month gold production rise by almost 14% over the prior year and that combined with concerns of slower global growth ahead has added to some pressure as well.

The Japanese situation continues to escalate and potentially drag on long enough that the trade is wondering if a slowing impact in industries besides automobile manufacturing could develop. Some players feel that the gold market is under pressure because of recent hawkish comments from the US Fed and also because of some market predictions that US QE2 is still set to end in June. News of a shift in political power within Germany (one of the few stalwart economic zones) adds to the uncertainty in Europe. All combined — the gold market has pulled back into Monday morning.

Support for the remainder of the day is the 1406-1410 area and resistance is the 1422-1426. In gold, I’m long 1/2 a position at 1406 — and added at 1418 last night for an average 1412. I’m using a stop at 1398 for the moment. From a chart perspective — the lower purple channel line is support — and so far gold has not reached that low point and the lower dotted trend line does not come into play until the 1385-1390 area. We’ll have to see how the price pattern looks — as our thinking is that options expiration and the roll into the June contract is what has temporarily brought gold down to this level on Monday.

The key now is for gold to get back above the 1425 area.

What we really want to see is a close above 1444 to give more confidence that gold is ending its trading range and is ready to move higher. The end of the month usually favors higher price into the first week of the month and we’re still looking for that at the moment. A short term peak will be due to begin sometime in the first 7 days of April — so we’ll be keeping an eye on that as well.

In summary — we’d like to see the lows develop here on Monday and push higher into the latter portion of the week.

by Bill Downey

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In last nights website update resistance was listed at 1438-1445 and the high so far today is 1438. Support was listed at 1418-1423 and the low so far is 1430.50

London Gold Fix $1434.00 -$8.25

In the early action today, April gold prices are sitting roughly $10-12 below the Thursday highs. A large portion of the corrective action was seen at the end of the prior trading session and prices this morning are trading in the mid to upper 1430’s. A margin rate increase in silver was probably the catalyst for the sell off on yesterday….. but it was certainly coincidental that we mentioned if a sell off into options expiration on Monday for Gold was in play that Thursday would be the most likely day.

Many gold players continue to think that the Euro zone crisis will provide support to gold prices going forward, as the fear of contagion or knock on influences have returned to the forefront.
Others in the trade noted that gold was able to gain in the face of weak US economic readings and that is considered a change of pace from the pattern that was seen in the beginning of March. In other words, some traders think that a series of weak US data points are capable of extending US QE and that in turn might give rise to a future inflation problem.

The Dollar is holding against most of the major currencies but is still fighting to get back above 76 and still remains in trouble on the charts as we close out the week.

Japanese authorities have suggested that one of the Fukushima reactors was leaking due to a broken core has increased an already dangerous condition.

Syria protests have been escalating as demonstrations are being driven by political demands. Economic issues and inflation concerns are behind the unrest. There are scheduled protests in UK also this weekend.

In today’s gold action, price is in a trading range and is very choppy. With the weekend approaching, yesterday’s downdraft, options expiration on Monday, the middle east and Japan situation, and traders moving from the April contract into June–it has created a lot of cross currents in today’s trade. Support for the remainder of the day is the 1420-1425 area and resistance is the 1438-1444 area. A close above this area would tend to favor the upside going into next week.

I cut my short term position in gold in half last night so as to lighten up for the weekend. Should there be a pullback into options expiration on Monday — I’ll look at adding it back in the 1415-1420 area or at the lower purple trend line on the chart.

In summary — yesterday’s pullback seems more manipulative action — and price should remaining choppy and range bound for the remainder of the day. The charts and the trends still look up into the first week of April. If there is a pullback early next week we’ll look at the price patterns and see if there is a good setup.

by Bill Downey

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In last nights website update resistance was listed at 1434-1444 and the high so far today is 1434.50 —- support was listed at 1419-1424 and the low so far today is 1425.50 —

London Gold Fix $1433.00

In the early action today, April gold has managed a rise above the prior session’s high but has reached the key 1435-1444 price area of resistance this week. This is the key area to watch this week. A close above 1435 would add to the bulllish potential towards 1460.

Reports that the Japanese disaster might end up costing as much as $300 billion. However, the upward track in gold and other commodity prices might be held back because of fears that containment of the #3 reactor at Fukushima has seen a setback overnight as commodities generally don’t like to see developments that could end up slowing the economy.

Talk that a Chinese gold company might be looking to acquire gold mines in other countries was viewed as favorable in today’s trade.

The Fed’s Fisher is a scheduled to speak today and yesterday he generally sounded a hawkish tone. The US Fed Chairman BERNANKE is also scheduled to speak just ahead of mid session today and some traders think he will largely countervail the dialogue from Fisher.

Gold will garner some support from a bullish price forecast from a gold company executive, who suggested that gold might have a “couple” more years of upside action before a top is formed.

While equity markets in Asia were mixed during overnight trading, stock indices in Europe are generally weaker this morning and the US stock market is a bit lower this morning. Home sales plummeted in USA — down 175 from January.

The Dollar is stronger against most of the major currencies during overnight trading, although posting a loss against the Yen. With the US dollar on the brink of NEW LOWS for the year and at a key chart point, we couldn’t help noticing that Portugal is in the NEWS headlines and the “spin” is that Portugal may be the third country that will ask for a Euro bailout. This has caused a Euro pullback and a BID for the US Dollar today. Coincidence ? Who knows anymore, but the US Dollar is higher in trading today. The Prime Misister of Greece also stated that any restructuring of Greek debt would bring on collapse of banks in his country.

Coalition air strikes have grounded the Libyan air force, but rebel forces have been unable to take advantage as fighting has reached a stalemate.

Going to the chart – Gold is up against key resistance today at the 1435 area — and this is probably the most important area for this week. A close above 1435 will favor higher towards 1444. Gold has attempted to move above this 1435-1445 area since Feb 28th so it is approaching decision time. The price pattern continues to show “capping” as Darth likes to call it —- but they can only hold it for so long and it looks like a decision point is coming in on the short term today or tomorrow. The upside still has the advantage but keep in mind that BERNANKE is scheduled to speak today and that can cause some choppy action.

Resistance for the remainder of the day is 1435-1444 and support is 1422-1426. The trend remains up.

In summary — but gold and silver are at key price points —and a close above these levels will keep the favored short term uptrend in place.

by Bill Downey

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I am sure it will not come as a shock to learn that there is an on-going investigation into a host of « big banks » who are accused of fixing their inter-bank lending rate (LIBOR) to effectively disguise and downgrade their indebtedness. The period involved reveals this was taking place pre-2008 crisis.

The investigation is well under way and involves the major Financial Service Regulators of the US and UK amongst others.
The scale is breath-taking and the accusations extremely serious as indicated by the issuing of subpoenas to retrieve sensitive documents for the prosecutor’s evidence.

Here are the details as reported by C Powell of GATA following a report in the Financial Times:

Regulators in the United States, Japan, and UK are investigating whether some of the biggest banks conspired to “manipulate” the benchmark interest rate used to calculate the cost of billions of dollars of debt.

The investigation centres on the panel of 16 banks that help the British Bankers’ Association set the London interbank offered rate, or Libor — the estimated cost of borrowing for banks between each other.

In particular, the investigation was looking at how Libor was set for US dollars during 2006 to 2008, immediately before and during the financial crisis, people familiar with the probes said.

The probe came to light on Tuesday when the Swiss bank UBS disclosed in its annual report that it had received subpoenas from three US agencies and an information demand from the Japanese Financial Supervisory Agency.
The bank said the regulators were focusing on “whether there were improper attempts by UBS, either acting on its own or together with others, to manipulate Libor rates at certain times.”
All the panel members are believed to have received at least an informal request for information — an earlier stage in an investigative process before a subpoena.

Witnesses had been interviewed by investigators from the US Securities and Exchange Commission, the Department of Justice, and the UK’s Financial Services Authority, people familiar with the probe said.

The inquiry has been under way for some months. At least one bank received its initial request for information in October, people familiar with the matter said.

The BBA produces Libor rates for 10 currencies using eight to 20 contributor banks. The contributors submit the rates at which they think they could borrow on the open market. Outlying submissions are tossed out and the reported rate is the mean of the middle values.

Critics of the process for setting Libor — which is used as a reference rate for about $350,000 Billion in financial products — have long claimed it is antiquated and lacking in transparency. Commentators complained bitterly during the financial crisis that the rates were distorted because they believed weaker banks were unwilling to admit higher borrowing costs.

UBS declined to comment beyond its disclosure. The regulators declined to comment. The other banks on the panel at the time covered by the probe either declined to comment or spokesmen could not be reached.

They are: Bank of America, Barclays, Citigroup, Credit Suisse, Deutsche Bank, HSBC, JPMorgan Chase, Lloyds, Rabobank, Royal Bank of Canada, Bank of Tokyo-Mitsubishi, Norinchukin Bank, Royal Bank of Scotland, and West LB.

HBOS, which has since merged with Lloyds, was also a member.

The BBA said: “We are committed to retaining the reputation and integrity of BBA Libor, which continues to be the authoritative benchmark of the wholesale money market. It has a straightforward and unambiguous calculation method, which excludes any rates which are significant outliers. It is fully transparent — all of the data inputted by the contributor banks is publicly available, as is our methodology.”
(By Brooke Masters, Patrick Jenkins, and Justin Baer , Financial Times)

Banks outside the law?

This type of activity is typical of the banking sector who operate amongst themselves as if they are untouchable and above law and regulation.
They believe in their own importance because of their size and apparent power which disregards national boundaries because of their global clout. They play by their own rules and we know where that leads us.

Even then, when they cause misery, mayhem and crisis for the whole world by their own greedy practices and mistakes they still come begging for more money to play with – and the worse thing is that incompetent governments full of over-educated, posh, millionaires who have absolutely no notion of the real world because of a privileged, sheltered, upbringing give them our taxes. I believe this should also be investigated as it stinks of incestuous, undeclared interests by senators and ministers who post politics suddenly appear on boards of directors doing nothing (consultants) for some enormous salary.

Do you trust your bank?

Do you know what they do with your money?

If there’s another crisis where will your money be?

If your bank gets into trouble will they have enough money to pay back all their customers?

Who do you think they will pay first? You? Yeah right!

If you’re not part of the Politocrat & Banking club you’ve got no chance.

I believe that Bankers should be personally responsible for their actions, decisions, judgements and huge mistakes they make and personally bankrupted to repay some of the missing funds. It should be in their contracts and not some huge retirement pay off for complete incompetence like Fred Goodwin (RBS).

Let’s face it they’re quick enough to give themselves performance related bonuses (when there’s the slightest positive news) so why doesn’t it work both ways? When a bank underperforms they should be responsible and pay for it just as they like to cream off their “rewards” for guessing right.

Stop bailing out incompetence – Let them fail!

I also believe that Banks that get themselves into a mess should get themselves out of it or let them go bust like any other business that fails – after all that’s why we have the word Bankrupt isn’t it?

It is two words combined – Bank & Corrupt! That about explains it!

The increasing problems of disasters and political unrest are putting further strains on all these large institutions that are exceptionally nervous because they know they are exposed and overstretched as pre-2008. Another feature is they never learn by experience!
In 2011 we will witness an economic crisis on a scale not yet seen.

The foundations of Countries economic policies and Financial Institutions “Good Practice” have not been prepared for the shock that is gathering strength and they will not withstand the shock and its magnitude.

Can you afford for them to go down with all your savings?

Should you wait until it starts and it’s on the Tele before you do something?

Should you buy fire insurance before or after a fire?
Act now and preserve some of your wealth by investing in tangible assets that will survive a crisis.

Act now to put your money into something that you own, that is not linked to a failing or devalued currency that will be a means of survival when you need it most.

Put your wealth into gold which has been the universal “currency” throughout history.

Don’t invest in “paper promises”.

Get Physical!

Own gold and gold coins.

People survived wars, crises, recession and depression because they owned Gold.

People also perished – because they didn’t!

What would you rather do? Survive or Perish?

Make your choice!

The impact of the growing number of recent natural disasters will inevitably provoke a deepening of the global economic crisis.
Our thoughts and hopes are definitely with the people of Japan, New Zealand, Australia, Chile, Sumatra, Brazil, China, Pakistan and all of the other regions affected in recent times by catastrophic natural disasters.

The sheer scale of these events and especially those in Japan reminds us of the fragility of humankind in the face of nature’s wrath. The trauma and tragedy of all these events are beyond comprehension unless you have survived one.
As hope still prevails that survivors may be found, what will the economic impact be of these events?
Profound!
The Nikkei has already dropped over 6% in the first day of trading. The central bank has injected over $180 billion to provide liquidity.
Remember that Japan was already struggling with a debt crisis on an enormous scale. Concerns will be that Japanese foreign interests and reserves will be liquidated to service the rebuild and to try and control the debt. There is over $5 Trillion of Japanese foreign investment and any significant moves to pull out large quantities would have a serious knock-on effect around the world.
Now whole areas of the economy will be affected. Manufacturing production in Japan’s most important industries and major corporations will be hit either directly or indirectly because of suppliers disappearing. This too could have an effect on Japanese industries abroad.
Infrastructure rebuild costs will be huge and the time to undertake this will also be an influencing factor. First guestimates indicate years or even decades will be required for Japan to rebuild and recover after the Japanese Prime Minister declared the disaster as big if not bigger than that suffered during World War II.

Japanese exports will be greatly affected and Japan will have to import much more to cope with deficiencies.

Nuclear Meltdown?

The unknown is now the increasing possibility that a nuclear incident will further worsen the impact and could have environmental issues for other countries.
The human cost, trauma, lack of labour will be another factor.
Many of these factors affect all areas hit by disasters and the pressure on economies is mounting.
But in a world already at odds with itself and unrest spreading through other parts of the world where does this leave us.
Nobody knows the real costs or the real impact of any of these tragedies. Experts make a best guess.
One thing can be sure is that collectively they present the global economic picture with additional demands for investment that it simply cannot meet.
Maybe Bernanke can introduce QE3 and print more dollars for US efforts to help their neighbours but as we know this if anything is compounding the world’s problems and bits of paper are not real money or wealth.

Financial Meltdown

What will happen to the large insurance groups who will be hit for claims on a colossal basis? Will they be able to pay? Will they indeed survive?
Are they not part of the global cycle for investing, hedging, banking etc?
Their pain will be shared and passed on but in doing so we will finally see the world wide web of debt come undone.
The fact is there is not enough money on the planet to repay all the hedges, spreads, bonds and loans.

This latest natural disaster is a forerunner of the man-made one to follow. The world is heading for financial meltdown and we are powerless to stop it.

The only thing you can do now is start to plan for the inevitable.
Ditch toxic assets, currencies and investments.

Click here to view a Special MoneyWeek presentation.

Get out of “paper promises” and get into tangible & real.
Look for a safe refuge or haven to park some “money” or wealth that may see you through the hardest times.
Don’t wait too long as hindsight is not an option.
Your insurance now rests with gold as the safest way to preserve your wealth and to survive the crisis we are facing.
Be safe, be prepared and buy now.

As previously reported on Goldcoin, Gold currency is making a comeback! In Utah, they could soon be buying a hamburger with gold!, the state of Utah has been considering a bill that would allow gold coins to become a new inflation-proof currency that would also be exempt from state capital gains tax.
The bill, HB317, was introduced by Republican Brad Galvez and it passed by 7 to 1 in the Utah House Government Operations Committee on Wednesday.

The bill sets out a framework for the Legislature to explore the possibility of an alternative legal tender system being created but the use of a gold currency would remain voluntary. The timing stipulated is for conclusions to be submitted for the 2012 session.
The “Utah Sound Money Act” was drafted by local attorney Larry Hilton who said that “un-backed money created by the Federal Reserve to stimulate the economy, is hanging over us like the sword of Damocles waiting to just come down in an avalanche and destroy the value of our currency.”

In short it represents the frustration of ordinary people who feel that the “paper dollar” no longer serves their needs. They have simply lost faith in a devalued currency which has eroded their wealth, their incomes and their purchasing power.

A Symbolic Act that brings back the Gold Standard?

Further comments came from Jeffrey Bell who is Policy Director for the American Principles Project based in Washington D.C. He explained that this bill would be viewed as a “symbolic act”. He added “But it sends a signal to Washington that political elites who want to leave the value and staying power of our currency uncertain, indefinite, so that they can at will intervene to do what they think would ameliorate the situation facing the U.S. economy.
The last time we had the system that we are recommending — the  International Gold Standard — it set a record for least inflation”.

It is interesting to note that the US Dollar is under pressure from all sides and its role as a “Global positioning Currency” is severely under threat as is its very existence.
We have previously discussed the possible role of Gold as a future money in Gold Money, a currency of the past…. and the future? And the demise of the Dollar in Financial Armageddon from worthless Paper Money.

Word is not only spreading but people are taking action against worthless fiat currencies and you too can do something now by taking out insurance against a fiat currency collapse – buy gold and gold coins. Remember it is always prudent and advisable to have insurance before the event – in this case an Economic crisis that could happen any time soon.

If the fat finger flash crash of 2010 taught us anything, it’s that our financial markets aren’t as sound and secure as officials want us to believe. With heavy leverage, computer trading platforms, financial secrecy laws, and the unabashed greed that pervades the halls of international financial centres, the entire global marketplace is susceptible to manipulation. The official post-mortem on the 2008 downturn suggests that the economic collapse, which started with rising oil prices and a sell-off in stocks, was caused by, among other factors, an over-leveraged and over-insured financial system with the culprit being an alphabet soup of financial instruments like Mortgage Backed Securities (MBS) and Credit Default Swaps (CDS).

As is the case with the lone gunman who shot Kennedy and the two planes that brought down the towers, the investigations surrounding the financial crisis were expedited, streamlined and have been officially closed.
A recent report from an independent contracting firm, however, warns that the events behind the financial crisis of 2008 and our economic woes today should not be underestimated and simply dismissed as having been a one-off event.

Evidence outlined in a Pentagon contractor report suggests that financial subversion carried out by unknown parties, such as terrorists or hostile nations, contributed to the 2008 economic crash by covertly using vulnerabilities in the U.S. financial system.
The unclassified 2009 report “Economic Warfare: Risks and Responses” by financial analyst Kevin D. Freeman, a copy of which was obtained by The Washington Times, states that “a three-phased attack was planned and is in the process against the United States economy.”
While economic analysts and a final report from the federal government’s Financial Crisis Inquiry Commission blame the crash on such economic factors as high-risk mortgage lending practices and poor federal regulation and supervision, the Pentagon contractor adds a new element: “outside forces,” a factor the commission did not examine.
Regardless of the report’s findings, U.S. officials and outside analysts said the Pentagon, the Treasury Department and U.S. intelligence agencies are not aggressively studying the threats to the United States posed by economic warfare and financial terrorism.
“Nobody wants to go there,” one official said.

In a previous report titled When China Pulls the Peg, Cardiac Arrest Will Follow in the USA we opined that the US, China and other nations are involved in economic warfare as a matter of policy. While diplomats enjoy State Dinners, luxurious travel and smile for the cameras, behind the scenes is a tug of war where entire populations of people, numbering in the billions of souls, are affected by negotiations and trade agreements. In the case of China, one must have their head in the sand to believe they are not actively competing on the economic battlefield. Not only do they have a direct influence on the future of the US dollar, but they have spent the better part of the last three decades mobilizing their labor force by significantly undermining US trade influence. The effect on the US economy is clear. While the Chinese grew their economy, they set into motion a series of events that have begun to impoverish the middle class in America. The result is fewer jobs and an indebted social system on the brink of collapse.
This did not happen by chance. It is by design.

“This is the ‘end game’ if the goal is to destroy America,” Mr. Freeman said, noting that in his view China’s military “has been advocating the potential for an economic attack on the U.S. for 12 years or longer as evidenced by the publication of the book Unrestricted Warfare in 1999.”

According to the report, elements within China, Russia, middle east oil producers and other interested parties may, separately or in unison, be actively pursuing policies and actions that are specifically designed to collapse the US economy.

“The preponderance of evidence that cannot be easily dismissed demands a thorough and immediate study be commenced,” the report says. “Ignoring the likelihood of this very real threat ensures a catastrophic event.”
The report concluded that the evidence of an attack is strong enough that “financial terrorism may have cost the global economy as much as $50 trillion.”

The Pentagon report indicates that there is a strong likelihood that whoever is behind the machinations is operating under a three phase approach. The first phase of the attack was the build up of excessive leverage and credit in asset markets, real estate and commodities. The second phase was the crash we experienced in 2008 and early 2009. International hedge funds and financial firms, some of which may be direct extensions of certain governments and operating under international secrecy provisions, initiated sell offs through the use of techniques like “naked short selling” and traditional “bear raids.” Lehman Brothers and Bear Stearns were wiped out and went down as the first casualties of phase two.

Since March of 2009 the economy has seemingly been growing, at least that’s what we’ve been told in official government memorandums and mainstream financial analysis. As evidenced by a rising stock market, the economy is well on it’s way to recovering the losses that occurred between 2007 and 2009.

While everything may seem fine to most Americans, including our elected officials and financial gurus, according to the threat assessment discussed in the Pentagon report, the powers-that-be who were responsible for the first two phases of the attack against our economic and financial system are now actively in the process of implementing and executing Phase III:

“Based on recent global market activity, it appears that the predicted Phase III may be underway right now.”
The third phase is what Mr Freeman states in the report was the main source of the economic system’s vulnerability. “We have taken on massive public debt as the government was the only party who could access capital markets in late 2008 and early 2009,” he said, placing the U.S. dollar’s global reserve currency status at grave risk.

The end-game is approaching, and as we’ve suggested in previous commentary, it is predicated on excessive government leverage, spending and monetization. The United States may very well be in the final bubble, one that trend forecaster Gerald Celente has referred to as the bailout bubble.

The formation of the final bubble, if it were a planned event, would have first required the first two phases of the attack as outlined in the report. Build up the leverage in the private sector, then completely crash it. This strategy necessitated a political response from the President, Congress and all manner of financial regulators.

As we saw in 2008, the strategy worked perfectly. Within days of the stock market collapse Presidential candidates were pausing their campaigns, Congress was having emergency meetings, and the Secretary of the Treasury threatened that there would be tanks in the streets if something wasn’t done. The response, of course, is well known and has led to tens of trillions of dollars in more debt in an attempt to stabilize the economy.

As the theorized Phase III continues to play out, we are likely to see more intervention in the form of crisis spending and quantitative easing. This continued printing of money is the Achilles’ heel. In just the last two years, because most global investors have begun shying away from US debt instruments like Treasuries, it is our very own Federal Reserve, a private banking conglomerate that is the number one buyer of US debt. The Chinese are already cutting back on their investment. And in due time, when the time is right, the Chinese simply have to say “no more,” at which point the government bailout bubble will burst.

Once in motion, there will be no more magic bullets for the Federal Reserve, Treasury Department, Congress or the President. We’ll have crossed the Rubicon.

What it will look like on the other side is anyone’s guess, but it could be that magic financial bullets get replaced with lead and missiles, as is usually the case when economies of nations are destroyed.
While US officials may not be overtly discussing economic warfare, one thing is for sure, and that is that the Pentagon and Military are Actively War Gaming ‘Large Scale Economic Breakdown’ and ‘Civil Unrest’. Army game theorists have spent time on financial exchanges with traders attempting to learn how an economic attack could be identified and are reportedly working on preventing such a possibility.

It’s our view, however, that if military and intelligence agencies are just now getting on board with the idea of economic warfare, it may very well be too late. If those who would bring down the US and global financial systems, be they foreign governments or shadow elements operating outside of traditional national boundaries, are actively engaged in “Phase III,” then it is likely that such an attack cannot be prevented – only managed and mitigated.

If this most recent report is accurate in its assessment, the only thing left for the average American at this point is to prepare for an imminent catastrophic shock and awe that will destroy life in America as we have come to know it.
Author: Mac Slavo from SHTFPlan

Planning for a crisis and survival means protecting wealth in universally accepted tangible assets such as Gold Sovereigns or other gold coins. Paper money will only keep you warm for a short time as it burns to make a fire. Gold has proved throughout history to be a means of survival through crisis and even wars. Click here for more.