Regular readers will recall that earlier this year I highlighted how the U.S. government covertly created a “Cuban Twitter” called ZunZuneo in a failed attempt to overthrow the island nation’s regime.   The elaborate plot was implemented under the umbrella of the U.S. Agency for International Development (USAID), which is responsible for overseeing billions of dollars in U.S. humanitarian aid. If you need a refresher, check out the post: Conspiracy Fact – How the U.S. Government Covertly Invented a “Cuban Twitter” to Create Revolution.
Well we now know that USAID went a lot further than that.    Another scheme to unseat the Cuban government has now been revealed.  This time with even more immoral foundations, and which could disrupt genuine humanitarian relief efforts the world over.
Incredibly, the U.S. government used an HIV program as a front to foster dissent amongst Cuba’s youth.   The HIV-prevention workshop was even referred to as the “perfect excuse to recruit political activists.” Despicable.

Shangahi Silver Stocks July 2014Chinese silver inventories are growing increasingly tight as stocks at the SFE continue to fall to record low levels. 
After the PAPER SMASH in the price of silver in April 2013, we can see just how fast inventories declined. 
By August, 2013, silver inventories at the Shanghai Futures Exchange fell 610 mt to 533…  a staggering 53% decline.  Inventories continued to fall, but a slower pace until they reached a low in November at 418 mt.
Then over the next three months, there was a build of silver stocks to a high of 575 mt in February, 2014.
Once the price of silver started correcting lower, inventories declined in March to 417 mt, and then a huge fall to 246 mt by the end of April.  In May and June, silver inventories remained relatively flat as spot price bottomed then headed higher in June.
When June rolled into July 2014, once gain, the price of silver headed lower right along with the decline in silver warehouse stocks..  Another 86 mt were withdrawn in July as inventories are now the lowest level (148 mt) they have ever been.
In a nutshell, silver inventories declined nearly 90% from their record peak set in March, 2013.  
The Shanghai Futures Exchanged experienced a net decline of 995 mt from March, 2013 to the end of July this year.

There is a war being conducted out there in the financial markets, too, a war between debtors and creditors, between governments and taxpayers, between banks and depositors, between the errors of the past and the hopes of the future.
How can investors end up on the winning side?

History would seem to have the answers.

CAT 797 picThe gold mining industry literally devours energy to produce an ounce of gold.  In the past decade, fuel consumption at the top gold miners more than doubled, but the actual energy cost grew at a much higher rate.
The huge increase of diesel consumption at the top 5 gold miners is due to several factors.   As ore grades continue to decline, the gold mining companies need to extract more ore to produce the same amount of gold.  Thus, the massive haul trucks that transport this ore burn more diesel in the process.
Furthermore, as open-pit mines age, they deepen which forces the haul trucks to travel longer distances at a higher grade.  One of the largest haul trucks in the world is the Caterpiller 797F.  These haul trucks are massive and can transport 400 metric tons of ore in a single trip.
The CAT 797F costs $5 million a pop and uses six tires that cost $42,500 a piece.  Studies show tire costs can exceed 25% of total haul-truck operating costs per ton; and total tire service and replacement costs over the useful service life of a haul truck can exceed the original purchase price of the truck!
The CAT 797F has a standard 1,000 gallon tank and has options for a 1,500 and 2,000 gallon tank. 

Did I mention that the CAT 797 gets 0.3 miles to the gallon of diesel? 

Summer_SaleA floor is not a “bottom that occurs just before blastoff!” event.   It’s a general price zone of enormous support, where downside price volatility should not be feared.
As the month of August gets underway, the gold market has a solid feel to it.
The commercials are still net short at least 160,000 contracts in gold.
There is great symmetry between the actions of the commercial traders in July-August 2009 and their actions today.

NO ONE IS IMMUNE TO FEAR.
You can thank the CDC for bringing the FIRST EVER Ebola case to the United States as a patient the CDC imported landed in Atlanta for treatment on Saturday.
Everyone I have spoken to about this in the alternative media is perplexed and troubled by the CDC’s decision to import two Americans with Ebola into the country. Even Donald Trump is concerned about this development, tweeting: Stop the EBOLA patients from entering the U.S. Treat them, at the highest level, over there.
As the CDC “urges calm” over Ebola for which there is NO CURE, Reuters is reporting today that the U.S. Government is seeking to test an Ebola vaccine on humans.
Hmmm, that was quick

Roughly a month ago, we exposed CYNK Technology Corp., which had a market value of $1 billion with ZERO revenue; it rose to more than $6 billion at its peak.  All this with one employee, no assets, no revenue, no website, and no product… What could possibly go wrong?
The CYNK bubble was, of course, the result of carefully planned deceit and clever promotion by a handful of people who stood to make a lot of money on the trade.
CYNK’s overvaluation was so outrageous that at one point the company was worth more than US Steel, the 13th largest steel producer in the world with 42,000 employees, $17 billion in revenue, and $414 million in operating cashflow.
Needless to say, CYNK was a complete and total scam. And it’s appalling that anyone actually believed it.
But when you think about it, CYNK’s stock wasn’t really any dumber than owning US Treasuries. 
The US government’s own numbers show they have net worth of NEGATIVE $16.9 trillion.  But still, the golden tale is spun: the US can never default on its debt.   People are told that US government can always raise taxes in order to pay back the debt.
But the numbers show a completely different story.

After consolidating and holding support throughout the overnight Asian and London sessions, gold & silver have once again been treated to a waterfall decline on today’s COMEX open, with silver breaking below substantial support at $20, and gold plunging towards $1280.

*Update: While gold has bounced off support at $1280, recovering all of it’s losses at one point, silver has not been allowed to recover from the COMEX open smash, and is again plunging into the access market close with a last of $19.70!

depressionWe have made a fascinating and stunning statistical discovery discovery buried right in the monthly non-farm payroll statistics.
Regardless of whether the Government numbers are bona fide or fraudulent, it shows why even the data itself shows that the U.S. has been net-net losing jobs since 1992.

After you see the video, you’ll understand why I believe that the U.S. housing market is about to enter Collapse 2.0. 

Ron PaulRon Paul is a guy who talks about things others don’t talk about; who doesn’t back down; who doesn’t suck up to establishment players;  and, to top it off, is almost always right.
The memo has apparently gone out: Don’t mention this guy or his ideas or policy prescriptions.
If someone with real and great influence did offer a public “mea culpa” about Ron Paul and begin to preach from his campaign playbook, Paul’s ideas would suddenly move from the “cult” fringe into the mainstream.
This would qualify as as a terribly “dangerous” development to TPTB and the cronies who game the status quo system,  but potentially life-saving (or nation saving) stuff to the rest of us.
However, Paul’s issues WILL be reconsidered one day soon.  
I predict that one day the nation’s voters WILL clamor for a politician with Ron Paul’s views to become president.
This will most likely occur after the economic system has crashed, after hyper-inflation has ravaged families and businesses, after the paper fiat dollar is rejected.   And, oh yeah, after gold and silver have probably become too expensive for almost anyone to buy.
This “revolution” in outlook will occur when the majority of Americans (and even economists and politicians) come to realize that the things Ron Paul said we’re going to cause a crisis of historic proportions actually did.

china goldThe overall markets are exuberant. Valuations rise regardless of value created.   And gold is conspicuously not at the party.
All of this sounds very familiar to John Hathaway and Doug Groh, portfolio managers of the Tocqueville Gold Fund. It is like 1999 all over again. In this interview with The Gold Report, the pair of fund managers shares their top 10 picks for a diversified portfolio that minimizes risk while maximizing the upside they see coming sooner rather than later.

Blythe Masters Jamie DimonWell it appears nothing has changed at the CFTC.   Less than two weeks ago we learned that former CFTC commissioner Scott O’Malia, who had fought hard against any new rules intended to reign in Wall Street practices, was leaving the CFTC to head one the biggest bank lobbying groups in the world, the International Swaps and Derivatives Association (ISDA). This is the exact lobbying group that had been pressing against new CFTC rules. 
So the CFTC claims it will be vigilant.
Like, for example, allowing JP Morgan to continue to issue fraudulent reports for well over a year despite repeated warnings, and then ultimately settle for a dollar amount that is probably equivalent to the Dimon family’s annual budget for toilet paper?   Yeah, that’ll show ‘em who’s boss!
You gotta love American justice.   JP Morgan gets off with another slap on the wrist.
As Glenn Greenwald noted, it’s Liberty and Justice for Some.

June’s FMQ components have now been released by the St Louis Fed, and it stands at a record $13.132 trillion. As can be seen in the chart above, it is $5.48 trillion more than an extension of the pre-Lehman crisis exponential growth trend.
The chart confirms that tapering seems to be having little or no effect on money markets and therefore the growth rate of fiat currency.
Still believe the Fed is really tapering QE?

269_cartoon_110_dollar_bill_small_over

For four decades, the dollar’s standing as the world’s most important currency—which has under-girded much of America’s post-World War II primacy in international affairs—has rested largely on the greenback’s dominant role in international energy markets.
Washington’s ability to leverage the security concerns of Saudi Arabia and other Persian Gulf Arab states to influence their decision-making on how their oil exports are priced and their petrodollar surpluses recycled has been central to consolidating and maintaining the dollar’s unique role in international energy markets.
China’s rise, as a global economic power and as Persian Gulf energy producers’ most important incremental market, poses the biggest challenge yet to the indefinite prolongation of dollar dominance, as the era of the petro-yuan begins. 
In many ways the petroyuan got its start in Iran;  for several years now, China has paid for some of its oil imports from the Islamic Republic with renminbi.
The emergence of the “petroyuan” alongside the petrodollar will almost certainly accelerate the ongoing erosion of America’s wider hegemony.

Jamie DimonMyself and a few others – primarily GATA – have been suggesting for quite some time that
While certain newsletter peddlers adamantly maintain the reports are accurate and honest in order to preserve their franchise, there’s nothing like the CFTC imposing a fine on JP Morgan for fraudulently reporting “large trader” data: CFTC Charges JP Morgan With Reporting Fraud.
JP Morgan has finally been caught and sanctioned for playing games with its position reporting in gold and silver in order to hide the true magnitude of its unhedged short positions on the Comex.

silver barsOne of the first things you learn when studying economics is the law of supply and demand, defined as follows: “In a competitive market, prices are determined by the interaction of supply and demand: an increase in supply will lower prices if not accompanied by increased demand, and an increase in demand will raise prices unless accompanied by increased supply.”  This is ECON 101 and it’s a fairly simply concept to grasp.

Now let’s take a look at the silver market with this concept in mind.  With regard to physical demand, we see that silver has been incredibly strong both on an absolute and relative basis.
Over the past 12-18 months we’ve witnessed the following:

The International Swaps and Derivative Association (ISDA) published their position on the changing of the “SILVER-FIX” with the new “LONDON SILVER PRICE” and the ramifications are earth shattering for silver derivative holders:
WHAT WAS ANNOUNCED WAS A SHOCKING “GET OUT OF JAIL FREE” CARD FOR THE SILVER DERIVATIVE SHORTS AND GUARANTEED TO THROW THE SILVER DERIVATIVE MARKET INTO CHAOS as none of the silver derivative contracts are legally binding after the London Fix ends August 14th!!

The EndIn this MUST WATCH interview with Alex Jones, former Presidential candidate Ron Paul warns that  “The Federal Reserve’s global hegemony is crumbling.  The lines are being drawn by the new BRICS banks, and we as a people need to prepare for the coming banking collapse.”
We’re closer to that point where there may be a precipitous fall (in the dollar).  The dollar has already lost 99% of its value, what if you lose the rest of it or 100%- that’s a big deal.  If you look at all the currency destructions around the world, the end stages go rapidly.” 

Paul’s full interview is below: 

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The current economic malaise is the result of the Federal Reserve and the US Treasury Department weakening the dollar in the early part of the last decade.   Every major economic crisis–including the Great Depression–is the result of catastrophic government errors.   Contrary to Keynesian myth, free markets are not inherently unstable.
The dollar was destroyed by ignorance.  The Bretton Woods system created in 1944 was what was called a gold exchange standard: the dollar was fixed to gold and other currencies were fixed to the dollar. Central banks could turn in dollars to the US for gold at $35 an ounce.
American authorities could have preserved the system very simply: the Federal Reserve would sell Treasury securities from its portfolio if gold began to move above $35 an ounce in the global markets and buy Treasuries if gold went below $35.
Instead the US and many other countries wanted to use monetary policy to try to stimulate their economies with easy money.
But you can’t print money like that and maintain a gold standard.   – Steve Forbes

The global economy is structured to systematically funnel wealth to the very top of the pyramid, and this centralization of global wealth is accelerating with each passing year.
According to the United Nations, 85 super wealthy people have more money than the poorest 3.5 billion people on the planet combined.  And 1.2 billion of those poor people live on less than $1.25 a day.  There is something deeply, deeply broken about a system that produces these kinds of results.  Seven out of every ten people on the planet live in countries where the gap between the wealthy and the poor has increased in the last 30 years.  Despite our technological advances, somewhere around a billion people go to bed hungry every single night.
It has been estimated that the wealthiest one percent currently have 110 trillion dollars.
That is 65 times more wealth than the bottom half of the global population combined.
They are hoarding wealth as we approach some of the most unstable days in all of human history.
And when our fundamentally flawed financial system finally does collapse, it will be the poor that will suffer the worst.

Like so many other things in popular American culture, this quaint notion of a “middle class” in the U.S. is at this point nothing more than a myth; a rapidly fading fantasy leftover from a bygone era.
As myself and many others have noted for quite some time, the decimation of the middle class began long ago.
It really got started in the early 1970′s after Nixon defaulted on the gold standard and financialization began to take over the American economy.   Median real wages haven’t increased since that time and the rest is history.