What an incredible day. I spent most of my day overlooking the beach in southern Mexico and so I was unaware of the buzz of activity that was going on worldwide. Around sundown, as I do most evenings, I then made my way to my office, Starbucks, and took my place in my usual seat, the red comfortable chair with armrests and began to scroll through the news of the day via the last free place on earth, the internet. And what a day it was.
I started by watching this interview with US Treasury Secretary, Timothy Geitner, on Meet the Press.
Timothy is hard to watch. He is a deviant, lying sociopath and he begins with a cartoonish explanation of his economic analysis of the last three years. Making a motion of a plane nosediving - all but missing him actually making the bbbbrrrrrrrrr noise with his mouth - he stated, "The... the.. the American economy," he stammered, "was faaalllllling off a cliff in the fall of '08."
Any ideas why that happened Timmy? I thought that is why we have the Federal Reserve and the phone book size list of financial rules and regulations, to avoid market panics, no?
He then goes on to state, "(Obama) put in place the most creative, the most forceful set of economic measures we have ever done as a country."
Is that what creates good economies Tim? Creative central planning? Maybe we should get someone even more creative to design these plans if that's what it takes. Lady Gaga, maybe? She's pretty creative with all those funny hats.
He then goes on to say a string of words that can only be described as hallucinogenic, stating how well the economy has done and how good the job market has been since then.
He then states that the problem with the economy is just an unwillingness to legislate things that can help. Yes, we need more government involvement and legislation, that's what we need. He even gave an example of something that could be legislated to help, stating, "If we can find ways to help rebuild America, we can put more people back to work."
Yes, if only we could find ways to rebuild America. Sadly, America died somewhere between the time the Federal Reserve was founded and an income tax enacted and FDR's "New Deal" and LBJ's "Great Society." What we have now is an animated corpse with a President that no one has any recollection of ever seeing prior to his ascendancy who reads platitudes off of pre-scripted teleprompters like Max Headroom to the adderall and prozac lobotomized masses.
He did conclude with one truthful statement, however, saying, "I think for a lot of people (this is going to be) very hard, harder than anything they've experienced in their lifetime for a long time to come."
Meanwhile, Ben Bernanke was meeting in front of Congress and stated that "the economy is growing more slowly and the central bank stands ready with more accommodative measures." The free markets, what's left of them, went to work immediately, setting fire to the dollar like the busted out old jalopy that it is. The dollar was in freefall against most currencies and gold flew to a new all-time high of $1,593.30, up nearly $30 on the day.
As much as we despise Ben for being the figurehead under which the financial elite rape, pillage and impoverish the planet, our gold-endowed portfolio couldn't have picked a better Keynes-head to be in charge of US monetary policy.
Ben then got lambasted by Ron Paul who asked him if he watches gold. Ben said he did - his voice quivering like a schoolgirl - before he was cut off by Ron Paul repeatedly, a very nice thing to see. There is no need to be overly polite to thieves and criminals.
Paul then asked a few questions that left Bernanke quite stumped, including the final one, "Why doesn't the Federal Reserve hold diamonds (instead of gold) if gold isn't money?"
Ben stood silent for a few awkward seconds before shrugging his shoulders, "Well, it's a tradition."
It's a tradition? Yeesh. Holding anything else as reserves for tradition Ben? Perhaps some of those Russian matryoshka dolls? They're fun.
While Ben B. was being roasted, Vladimir Putin, a sick individual in his own right, also laid on the attacks on the Federal Reserve, calling them "a bunch of hooligans" because of their extreme money printing. You must be doing something when a KGB hitman and Stalin loving psychopath thinks you are a hooligan!
Meanwhile, in another part of Washington, the fight over the debt ceiling reached extreme levels with Barack Obama getting visibly angry with Republican Majority Leader, Eric Cantor. Cantor, by the way, owns one of our holdings - the Proshares UltraShort Treasuries (NYSE:TBT). Some may see Cantor being short Treasury Bonds as a slight conflict of interest, given his position in negotiating the raising of the debt ceiling - but no one seems to care much about integrity in D.C. (District of Criminals).
The funniest part of today's debate about whether to admit bankruptcy today or to forestall admitting bankruptcy a few months into the future, was when Barack Obama stormed out of the meeting after angrily stating, "Don't call my bluff!"
Obama appears to know about as much about poker as he knows about the financial affairs of the US Government. The statement itself makes no sense. Does he mean he was bluffing? If so, in poker, if someone is bluffing, the thing you want to do is call it. You might say, "Call my bluff", to state that you are going to prove you aren't bluffing... but to say "don't call my bluff" makes no sense from any perspective.
Obama just doesn't make any sense when he's not connected to his teleprompters! Someone get him plugged back in, please.
Still not to be finished for the day, Moody's then warned that US Government debt was close to being downgraded. This was yet another nail in the dollar coffin. The funny part is that they said they may downgrade it from AAA to AA. Earth to Moody's: If the US Government doesn't raise the debt ceiling they will have to default on their debt obligations... in other words, if they are going to downgrade it they shouldn't downgrade from AAA to AA, it should be from AAA to the lowest rating they have, C - denoting bonds that are in default and a new term for the US Treasury Bond should be created in their honor - Super Junk Bonds works.
Ah well, who listens to Moody's anymore anyway?
All in all it was a crazy day... and I didn't even mention Europe, which is on the brink of the abyss as well.
We stand on the precipice of The End of the Monetary System as We Know It (TEOTMSAWKI) and today is proof of that. Dozens of countries are evolving - not devolving - into revolutions, mostly caused by this non-free-market fiat money financial system. The European Union stands on the brink of collapse. And today the Federal Reserve was under attack more than at any other time in history while the US government is straining under the weight of debts too large to ever be payable.
Indeed the bell tolls for thee, the US dollar based financial system, the central banks and the modern day version of tax farms - the state. And, good riddance.
Jeff Berwick, a self-described financial freedom fighter, is the founder of Canada's largest financial website, Stockhouse.com. He now writes the libertarian, Austrian-economics based newsletter, The Dollar Vigilante and is a regular speaker at many of the world's most important investment, resource and freedom-focused conferences where he is known as the most dangerous man in finance.