Robert Kiyosaki Blog

Financial Education Portal inspired by Robert Kiyosaki

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Gold Bullion Continues to Drain Out of COMEX

It was announced this evening that President Obama will nominate Janet Yellen as the new Fed Chairman tomorrow, having been denied his first choice of Larry Summers by popular outrage. There were big adjustments in the registered (dealer) gold inventories at JPM and HSBC yesterday as a total of over 40,000 ounces of gold bullion moved back to the customer storage category. In Scotia Mocatta 4,572 ounce of customer gold moved into the deliverable category. Brinks received about 1,700 ounces of gold into its registered category which will be offered for delivery and Scotia also received 1,618 ounces into storage. These were the only external transactions. So as of yesterday there was a total of 731,226 ounces of deliverable gold, and a total of 6,888,160 ounces of gold in all the COMEX warehouses. And there are 48 times more claims for the deliverable gold than there is gold to deliver, at least at these prices. They may dodge, bluff and finesse their way for some time, the audaciously clever ones that they are, but at last there will come a reckoning, as it comes for all. Weighed, and found wanting. Stand and deliver. By Jesse http://jessescrossroadscafe.blogspot.com Gold Bullion Continues to Drain Out of COMEX Share and...

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MAX KEISER: Debt Zombie Students

In this episode of the Keiser Report, Max Keiser and Stacy Herbert discuss the potholes in the economy causing young people to go deeply into debt for education, property and retirement. In the second half, Max talks to Iona Bain of youngmoneyblog.co.uk about students debts in the UK and the merits of raising interest rates in order to encourage savings. Share and...

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Gold Holds Above $1,300 as Investors Weigh Shutdown, Stimulus

Gold held above $ 1,300 an ounce after gaining the most in two weeks as investors assessed the U.S. government shutdown and its impact on the outlook for monetary stimulus from the U.S. Federal Reserve. Bullion for immediate delivery fell as much as 0.5 percent to $ 1,309.47 an ounce, and traded at $ 1,312.28 at 2:15 p.m. in Singapore. Prices climbed 2.2 percent yesterday, rebounding from an eight-week low of $ 1,277.15, after a private report showed U.S. companies added fewer workers than forecast in September, supporting the case for the Fed to maintain its $ 85 billion-a-month of bond buying. The first government shutdown in 17 years, which IHS Inc. (IHS) estimates may cost the U.S. at least $ 300 million a day in lost economic output, extended into a second day yesterday as President Barack Obama refused to negotiate in a meeting with top congressional leaders, said House Speaker John Boehner. Gold dropped 22 percent this year on speculation the U.S. central bank may scale back asset purchases as the economy recovers. “The market expects a short shutdown that will have a minimal impact on the broader economy and doesn’t change the Fed’s timetable on tapering,” said Mark To, head of research at Wing Fung Financial Group, a Hong Kong-based precious metals trader and refiner. “If the budget standoff stretches into next week, it could begin to negatively impact the economy, and the demand for a safe haven will support gold.” Gold for December delivery dropped 0.7 percent to $ 1,311.30 an ounce on the Comex in New York after climbing 2.7 percent yesterday and falling 3.1 percent on Oct. 1. Trading was 57 percent below the average for the past 100 days for this time of day, data compiled by Bloomberg show. Silver for immediate delivery rose and fell at least 0.5 percent, before trading 0.3 percent lower at $ 21.67 an ounce. Platinum was little changed at $ 1,387.20 an ounce and palladium lost 0.2 percent to $ 716.98 an ounce. Gold Holds Above ,300 as Investors Weigh Shutdown, Stimulus Share and...

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Simon Black – Five reasons why gold prices will decline

This morning I received a research note from a private bank I work with occasionally.Buried in the text was a call for lower gold prices, and the analysts listed five reasons why they think gold prices will decline. Here’s what they had to say: 1) “We expect the scaling back of [the Fed’s] stimulus to happen this year at the December meeting. A reduction in monetary stimulus . . . shall reduce the attractiveness of gold as a zero-income asset.” 2) “Inflation pressures in the developed world should remain subdued, lowering demand for gold as an inflation-hedge.” 3) “We expect the US recovery to accelerate, reducing the attractiveness for gold as a safe-haven asset.” 4) “A subsequent improvement in investor sentiment shall also reduce demand for gold as safe-haven asset.” 5) “Physical demand from India should be discouraged by the gold import duty increases and other measures that aim to reduce the current account deficit.” My analysis? These guys are completely missing the point. The reality is that today’s financial markets are controlled and manipulated by central bankers who are destructively expanding their balance sheets to the point of insolvency. Many central banks are already insolvent. Most “rich” countries are bankrupt. And the “richest” country in the world has entered yet another sad, farcical episode public fiscal humiliation. The US government is so broke that they fail to collect enough tax revenue to cover mandatory entitlement spending (like Social Security) and interest on the debt. And that’s with interest rates at all-time lows. The debt is growing by the day. The US government reached its statutory debt limit back in May, and as soon as they raise the debt ceiling, they’ll quickly reach the new limit again. The US government cannot even afford the 1.968% average interest that it is currently paying. (This is compared to 6.620% back in January 2001, and 3.665% in September 2008 when Lehman collapsed…) Politicians are seizing pension funds, raiding bank accounts, and raising taxes. They’ve imposed capital controls, and even restricted gold importation and ownership. Investors are addicted to cheap money like meth junkies. Stock markets are at all-time highs. Bond markets are near all-time highs. Many other asset classes (US farmland) and commodities (cattle) are also near all-time highs. There’s very little in this world that makes sense. I own farmland in South America as the ultimate hedge against inflation, system disruptions, and economic decline. Plus it generates great cashflow. But farmland isn’t terribly portable or liquid. And that’s why gold is such a great option. Precious metals are like an insurance policy. It’s a policy you hope you’ll never need to cash in. But if the need ever...

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Mike Maloney on the Fed’s Gold Trap and the End of the Dollar

Here’s what’s in your Prime Interest today: The London Whale has escaped the prosecutorial net! Bruno Iksil– the JP Morgan Chase trader who earned himself the nickname after a six billion dollar trading loss last year– is off the fishing hook, so to speak. He reached an agreement with US authorities yesterday. So, it looks like the mainstream media successfully floated his freedom. But now it seems federal authorities have other fish to fry. Today they moved up the food chain, charging Iskil’s former boss with wire fraud and a conspiracy to falsify records. The decision not to go after Mr. Iksill may prove important to the case, as it is likely he will be used as a witness for the prosecution. Let’s see how far they can swim upstream. And don’t break out your taper hats just yet. A sequester squabble could put a damper on the Fed’s plan to wind down QE. According to economists at Bank of America and Barclays, the risk of a government shutdown this October may delay any tapering moves, especially if Fed officials are on the fence. And if you are in Jim Rickard’s camp, who believes the Fed will taper in September or never, then QEternity may just become a QReality. Bob talks about the unprecedented expansion in base money with Mike Maloney, founder of GoldSilver.com and creator of the Hidden Secrets of Money. Plus, billionaire activist investor Carl Ichan is at it again. This time he is snapping up Apples, rather than nutrition supplements. He has taken a large position in the tech company and is pressing for a greater return of cash to shareholders. Ichan’s plan is for 150 billion in Apple stock buybacks. However, most of the company’s cash is held overseas– remember that little issue? Looks like Apple’s Irish tax scheme might not be so tasty to the dietary supplement King. Perianne profiles the mega-Ichan. Finally Bob talks to RT Correspondent Meghan Lopez about a recent drone conference — where no one was actually allowed to say the word “drone.” Share and...

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Simon Black – This is panic: Smuggling diamonds out of India

Asia is a damned excited part of the world. And Singapore is the financial epicenter of all of it. For the last 24-hours, banker and fund manager friends of mine have been telling me stories about oil refinery deals in North Korea, their crazy investments in Myanmar, and the utter exodus of global wealth that is finding its way to Singapore. My colleagues reported that in the last few weeks they’ve begun seeing two new groups moving serious money into Singapore– customers from Japan and India. Both are very clear-cut cases of people who need to get their money out of dodge ASAP. In Japan, the government has indebted itself to the tune of 230% of GDP… a total exceeding ONE QUADRILLION yen. That’s a “1″ with 15 zerooooooooooooooos after it. And according to the Japanese government’s own figures, they spent a mind-boggling 24.3% of their entire national tax revenue just to pay interest on the debt last year! Apparently somewhere between this untenable fiscal position and the radiation leak at Fukishima, a few Japanese people realized that their confidence in the system was misguided. So they came to Singapore. Or at least, they sent some funds here. Now, if the government defaults on its debts or ignites a currency crisis (both likely scenarios given the raw numbers), then those folks will at least preserve a portion of their savings in-tact. But if nothing happens and Japan limps along, they won’t be worse off for having some cash in a strong, stable, well-capitalized banking jurisdiction like Singapore. India, however, is an entirely different story. It’s already melting down. My colleagues tell me that Indian nationals are coming here by the planeful trying to move their money to Singapore. Over the last three months, markets in India have gone haywire, and the currency (rupee) has dropped 20%. This is an astounding move for a currency, especially for such a large economy. As a result, the government in India has imposed severe capital controls. They’ve locked people’s funds down, restricted foreign accounts, and curbed gold imports. People are panicking. They’ve already lost confidence in the system… and as the rupee plummets, they’re taking whatever they can to Singapore. As one of my bankers put it, “They’re getting killed on the exchange rates. But even with the rupee as low as it is, they’re still changing their money and bringing it here.” Many of them are taking serious risks to do so. I’ve been told that some wealthy Indians are trying to smuggle in diamonds… anything they can do to skirt the controls. (This doesn’t exactly please the regulators here who have...

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J.P. Morgan Chief to Meet With Holder

J.P. Morgan Chase CEO James Dimon presents his identification to a security officer as he arrives at the Justice Department in Washington on Thursday amid talks over a possible $ 11 billion settlement between regulators and the bank. J.P. Morgan Chase & Co. CEO James Dimon met with officials at the Justice Department Thursday morning amid intensifying talks of a possible $ 11 billion settlement to end criminal and civil charges. Mr. Dimon arrived at the Justice Department building around 9:20 a.m. to meet with Attorney General Eric Holder, according to a person familiar with the meeting. Mr. Dimon and Mr. Holder met face-to-face to discuss terms of a potential deal, according this person. Like all visitors to the building, Mr. Dimon showed identification to the guards—in his case a New York State driver’s license—and proceeded inside. He left the building less than two hours later. The Justice Department has at least seven ongoing probes of the bank, and the bank’s leadership is trying to resolve them in a rapid fashion. J.P. Morgan made a settlement offer of $ 3 billion on Monday night to settle investigations of alleged past abuses in residential mortgage-backed securities—a figure that was rejected by Mr. Holder, according to people familiar with the discussions. The bank, according to these people, has been trying to resolve as many cases as possible. Last week, it agreed to pay $ 920 million to settle regulatory charges related to its “London whale” trades and admitted wrongdoing. A key sticking point in the Justice talks has been the possibility of criminal charges—and whether the bank is willing to admit wrongdoing to avoid such charges, the people said. If a deal with Justice falls through, the U.S. could be left to pursue a previously threatened civil lawsuit against J.P. Morgan. Mr. Holder and Mr. Dimon are expected to discuss the contours of the settlement at Thursday’s meeting. The bank’s share price early Thursday was rising more strongly than the general market. One scenario under discussion would include a $ 7 billion cash penalty plus $ 4 billion in relief that J.P. Morgan would provide to consumers, a person familiar with the discussions said. As of Wednesday, the two sides still were billions of dollars apart, depending on which set of investigations might ultimately be resolved in any potential deal, another person familiar with the matter said. The price tag could change substantially again if one or more agencies bow out of the discussions. J.P. Morgan wants any potential pact to make clear that the probes are finished and that the bank won’t face any further liability on mortgage-backed securities, according...

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Is China Ready to REPLACE the US DOLLAR – Interview with David Morgan

BREAKING Is China Ready to REPLACE the US DOLLAR David Morgan, Part 2 Share and...

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Simon Black – They blew it…

September 23, 2013 London, England [Editor’s Note: Tim Price, Director of Investment at PFP Wealth Management and frequent Sovereign Man contributor is filling in for Simon today.] “This took guts.” – Comment by Steven Ricchiuto of Mizuho Securities in response to the Federal Reserve’s surprise decision to refrain from “tapering” its $ 85 billion monthly bond purchase program. Human beings are suckers for a story. The story peddled by mainstream economic commentators goes that the US Federal Reserve and its international cousins have acted boldly to prevent a second Great Depression by stepping in to support the banks, (and not coincidentally the government bond markets) by printing trillions of dollars through the mechanism of quantitative easing. It’s a story alright. But more akin to a fairy tale story. We favor an alternative narrative, namely that politicians have abdicated all real responsibility in addressing the financial and economic crisis, and the heavy lifting has been left to central bankers who have run out of conventional policy options and are now stroking the fire for the next financial crisis by attempting to rig prices throughout the financial system. Moreover, their actions have had a grave impact on volatility across credit markets, government bond markets, equities, commodities.. But in reference to Steven Ricchiuto of Mizuho Securities (see quote above), it’s quite easy to be brave when you’re spending other people’s money. Or money conjured from thin air. In defending an insolvent banking system, central banks have now created an absurd situation. This writer, for example, has a meaningful cash deposit with a UK commercial bank that is currently earning 0.0% interest (let’s say minus 3% in real terms). To put it another way, we have 100% counterparty and credit risk with a minus 3% annual return. Is it any wonder the savings rate is not higher ? Is it any wonder that savers are stampeding into risk assets? But the Fed has muddied the pond further by attempting a policy of “forward guidance” that is little more than a sick joke, given the recent sell-off in government bond markets and the resultant rise in government bond yields, on fears of “tapering”. It’s clear the Fed has lost control of the bond market. And as Swiss investor Marc Faber puts it, “The question is when will it lose control of the stock market.” Meanwhile, the impact of the Fed’s policies on the general economy has been… questionable, at best. But their impact on financial markets has been demonstrably beneficial to investment banks and their largest clients. As Stanley Druckenmiller points out, the Fed didn’t act bravely, they bottled it. They had the opportunity...

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Silver Manipulation Acknowledged By Government

Silver Manipulation Acknowledged By Government Christian Garcia GoldSilver com Share and...

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