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Are You Infuriated Yet?

Authored by Chris Martenson via PeakProsperity.com,

More and more, I’m encountering people who are simply infuriated with how our “leaders” are running (or to put it more accurately, ruining) things right now. And I share that fury.

It’s perfectly normal human response to be infuriated when an outside agent hurts you, especially if the pain seems unnecessary, illogical or random.

Imagine if your neighbor enjoyed setting off loud explosives at all hours of the day and night. Or if he had a habit of tailgating and brake-checking you every time he saw your car on the road. You’d been well within your rights to be infuriated.

Or to use a much more common example from the real world : When your politicians repeatedly pass laws that hurt you in favor of large corporations — that, too, is infuriating. Especially if those actions run directly counter to their campaign promises.

There’s a lot of be infuriated about in the world today, so go ahead and embrace your rage. By doing so, you’ll be in a better mindset to understand things like Brexit, Catalonia, and Trump, each of which is a reflection of the fury of your fellow citizens, who are finally waking up to the fact that they’ve been victims for too long.

An easy prediction to make is that this simmering anger of the populace is going to start boiling over more violently in the coming years. Welcome to the Age of Fury.

‘Over The Top’ Dumb

Do you ever get the sense that, as a society, we’re being dangerously reckless? Perhaps so dumb that we might not recover from the repercussions of our stupidity for many generations, if ever?

There are economic and financial idiocies in motion that are, by themselves, unsolvable predicaments without a peaceful solution. But when combined with resource depletion and declining net energy, they’re positively intractable.

Take for example the hundreds of trillions of dollars-worth of underfunded entitlement and pension promises. Those promises cannot be kept and they cannot be paid. Everybody with a basic comprehension of math can conclude as such.

Yet we continue to operate as if the opposite were true. We comfort ourselves that, somehow, all the promised future payouts will be made in full — even though the funds are insolvent, their returns are much lower than the actuarial projections require, and payout demand mercilessly rises each year.

Spoiler alert: This isn’t some future disaster lying in wait. It’s unfolding right now.

Take these headlines spanning the past several years:

When it comes to broken retirement promises, the future is now. It will be with us for a very long time.

Why? Because the math simply doesn’t work. It’s broken, it’s been broken for a long time. You can’t put too little in the piggy bank at the start, then raid it over time, and still expect to have enough at the end.

And yet we, as a society, have preferred to pretend as if that weren’t the case. Which, it turns out, was a terrible “strategy.”

But if you think that’s bad, you’re going to positively hate this chart:

S&P 500 chart

The pension liabilities now blowing up are contained within the thin green smear in the middle of this chart. Think on the nation’s inability to handle that single crisis, and now reflect on how overwhelmed it’s going to be by the far larger predicaments that lie elsewhere on the chart.

The Infuriating Plunder-fest That Is Health Care

The Medicare liabilities (the orange and largest band on the above chart) are immense, and will only become more so as our largest demographic, the baby boomers, further ages. But they become especially infuriating when seen in the larger context of the racketeering that drives the health care system in the United States.

Instead of doing anything constructive about the high number of IOUs building up within Medicare, Washington DC politicians are sidestepping the most obvious elements that contribute the most to the problem. Enormously wasteful, the “healthcare” system is entirely out of control and spiraling deeper into an abyss that threatens to literally destroy the most productive segment of the US social structure: the middle and upper middle classes.

That should be a topic of serious discussion in the halls of power. But none is being had.

Literally each day brings worse news on the skyrocketing costs of healthcare. But, as with most topics,  the media mostly focuses on the symptoms (prices) rather than the causes of the issue.

The real culprits here are the insurance cartel and a hospital system that has the most unfair, incomprehensible, and inhumane billing process ever devised. One easy to grasp feature of both the insurance companies and conspire to pay the executives far more than they actually deserve or are truly worth.

Health care premiums for 2018 set to go up by as much as 50 percent

Oct 5, 2017

 

Several states have announced rates for health insurance premiums on the Obamacare exchanges for 2018. Topping the list is Georgia, with rates that are 57 percent higher than last year, while Florida said some premiums will be 45 percent higher.

 

Among the reasons for these increases is the uncertainty about the future of the Affordable Care Act. President Donald Trump has vowed to repeal and replace the health care law, which was passed under his predecessor President Barack Obama.

 

Insurers are raising premiums in the face of repeated threats from President Trump to stop funding so-called cost-sharing reductions, payments to insurers that cover out-of-pocket costs for some low-income consumers. Trump previously referred to these payments as “bailouts” for insurance companies and threatened to stop making the payments so as to “let Obamacare implode”.

(Source)

That’s the story the health insurers are going with: they have to raise rates because they’re uncertain whether they will get AS MUCH LOOT under the new rules being considered as they did under the utterly disastrous Obamacare provisions.

How much loot are we talking about? Look at this chart of the stock price of United Healthcare (UNH) since the passage of the Affordable Care Act (aka Obamacare):

S&P 500 chart

If this chart showing massive near-4x gains in just 5 years, coupled with your steep annual premium increases, doesn’t infuriate you, you are just not getting it.

Even if your employer pays for your health care (somewhat obscuring the true impact of premium increases), the cost to you is fewer and lower pay increases, as well as steady yearly reductions in covered services along with higher co-pays and deductible amounts.

Still not infuriated? Ok, maybe this will do the trick. Here how much executive compensation at the major insurers was last year:

S&P 500 chart

(Source)

The average family health care insurance premium in 2016 was $18,764, meaning that Mark Bertolini from Aetna alone required 100% of the premiums from more than 2,200 families just to pay him in 2016. Of course, the “C-suite” of these health care insurers are loaded with other high-paid parasites who are just as busy gouging the young and old alike.

This is a complete travesty and joke. Congress and the Senate, sitting on their deservedly low approval ratings, pretend they cannot do anything about it. Too complicated they say. Bullshit I say. Go after the obscene pay packages and profits of the insurance industry as a first matter of business. Then make it a crime for hospitals to bill people differently for the exact same services.

That’s a no-brainer. Can you imagine if your mechanic had a secret pricing formula for every customer that was, literally, based on their maximum ability to pay? Nobody would stand for it, it’s disgusting that we tolerate this when it comes to something as vital and necessary as our health and even lives.

Fury, not tolerance, is what’s needed now.

Conclusion (to Part 1)

The future has arrived. The pension losses are here and just getting started and the future will have a lot more of those sorts of broken promises.

The health care insurance crisis has been with us for 20 years or so now and Obamacare just put some extra accelerant on that fire, which is now consuming middle class households by the tens of thousands.

Both the pension and health care crises are infuriating and self-inflicted wounds. We could have avoided them by making wiser choices in the past. We didn’t. We could limit their damage by making better choices today. We almost assuredly won’t.

Current conversations and proposals are thinly disguised sleight-of-hand movements whose purpose is to deflect attention from the thefts underway. Anybody who studies the system and its math comes to the same conclusion: the corporations have all the power and they are misusing it for private gain.

Why there aren’t more politicians willing to call a spade a spade and actually protect their constituents is a real mystery. But the next wave of populist candidates certainly won’t be. People are sick and tired of being asked to give more and more while corporations and wealthy elites keep taking more and more.

It’s simply infuriating.

But that’s not the worst of it. The mistakes we are making right now in terms of energy policy and ecological destruction are far more dangerous to your personal health, liberty and future prospects than a simple market crash.

In Part 2: It’s Time For Action, we uncover the hidden downside risks in today’s financial markets and explain how, as destructive as a coming market crash will be, the longer-term damage to society and risks to your well-being are rooted in the potential breakdown of the systems we depend on to live. As with pensions and health care, we are pursuing similar dangerously misguided policies in our farming & food systems, extraction of industrial resources, and ecological management — to name just a few.  There’s an appropriate time for fury. And that time is now — provided we use the anger to spur us into constructive action. Get your fury on. Click here to read Part 2 of this report (free executive summary, enrollment required for full access)

 

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Shkreli Lawyer Distances Himself From ‘Most Hated Man In America’ As Trial Begins

While former Turing Pharmaceuticals CEO Martin Shkreli languishes inside a federal jail in Brooklyn, the trial of his former attorney – and alleged co-conspirator – Evan Greebel is just beginning, with the defense and prosecution giving opening statements Friday.

The timing is unfortunate. Shrekli’s trial – which ended in him being convicted of three out of eight counts of fraud – briefly revived the public rancor over his many misdeeds. Given Shkreli’s toxic public image, it comes as no surprise that Greebel’s lawyers are already seeking to distance their client – who was arrested on the same day as Shkreli and whose picture was splashed across cable news networks alongside Shkreli’s – from the disgraced pharma executive, who was jailed last month after a judge revoked his bail following a series of controversial and vaguely threatening Facebook posts, Bloomberg reported.

As many will remember, Shkreli’s comfortable life as a successful young pharmaceutical CEO began to unravel in September 2015 when the New York Times reported that Turing had hiked the price of a life-saving toxoplasmosis drug by 5,000%, thrusting Shkreli into an uncomfortable public spotlight and drawing a public rebuke from Hillary Clinton, then presumed to be the next president of the United States.

Following his indictment, Shkreli seemingly set out to destroy any lingering public sympathy by antagonizing the federal government and harassing female journalists – actions that ultimately led to his jailing. Prosecutors have accused Greebel of helping Shkreli steal $11 million from Retrophin, a pharmaceutical company Shkreli founded and ran before being forced out in 2014. Greebel was terminated as Retrophin’s counsel soon after.

Shkreli allegedly used the money, along with Retrophin stock, to repay investors in two failed hedge funds by signing them on to sham consulting agreements with salaries and stock grants. Greebel is also accused of helping Shkreli manipulate the price of Retrophin stock.

Fortunately for Greebel’s defense team, their client has a somewhat more resepectable public image than his associate. He has a family and was once a partner at Katten Muchin Rosenman LLP and Kaye Scholer LLP. They’re essentially trying to sell a narrative of him being a quiet family man who got in over his head.

In opening statements on Friday, Greebel’s lawyer told jurors that the 44-year-old father of three and Shkreli, a former biotech executive notorious for aggressive drug-pricing tactics, were as “different as two people can be.” Greebel was by no means Shkreli’s “right-hand man,” defense lawyer Reed Brodsky told jurors at the trial in Brooklyn, New York.

 

Greebel “lived a quiet life,” Brodsky said, while Shkreli was “cultivating this public personality and persona, blogging and tweeting.”

 

It’s no mystery why Greebel, a former corporate lawyer, would want to separate himself from Shkreli, who is in jail after his conviction for lying to hedge fund investors (although jurors weren’t told about that). Greebel wants to show that Shkreli lied to him as well, and that Greebel had no reason to believe he was being asked to do anything wrong.

 

“Mr. Shkreli is kind of a contradiction,” Brodsky said, arguing that Shkreli managed to con people with his “image” of success, brilliant ideas and “photographic memory.”

Meanwhile, prosecutors allege he knowingly helped Shkreli loot his company and manipulate its share price for profit.

In the government’s opening statement, Assistant U.S. Attorney David Kessler said Greebel started working for Shkreli’s companies around 2011 and used his legal talents to aid Shkreli’s fraud. Kessler said Greebel wanted to please Shkreli to make millions of dollars in fees for his firm.

 

“Agreeing to help the CEO of a company steal from the company is a crime,” Kessler said. “Agreeing to help illegally control the stock market is a crime.”

As Bloomberg noted, Greebel’s demeanor in court couldn’t have differed more from Shkreli’s. He sat quietly by his defense team, smiling briefly but otherwise remaining expressionless.

Meanwhile, Shkreli’s was on the receiving end of more bad news this week when a Brooklyn judge refused to return his $5 million bond, saying the money might be needed to offset any monetary penalties that may be levied against Shkreli, the New York Post reported.

Shkreli’s lawyer Ben Brafman asked her to release the money so his client — No. 14 on New York state’s list of top delinquent taxpayers — can start paying taxes.
 

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McCain As Metaphor

Authored by Justin Raimondo via AntiWar.com,
Some people are living symbols, sheer embodiments of a concept that fits their persona as snugly as their skin: e.g. the Dalai Lama personifies Contemplative Piety, Harvey Weinstein is the incarnation of Bra…

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3 Stories That Show Big Brother is Alive and Well

Via The Daily Bell

Getting Clever with Fear to Restrict the Internet.

Representatives from the seven countries (UK, USA, Germany, Italy, France, Canada, and Japan) known as the G7 which form the Council on Foreign Relations met to discuss what to do about extremist jihadi content on the internet. They want to work with tech giants to make sure anything that could recruit or train terrorists is taken down within two hours.

The United Kingdom actually proposed jailing anyone who even views extremist content online for up to 15 years! Of course, the governments will define “extremist content.” And as most things go, their definition will likely get looser over time.

For instance, when SWAT teams were introduced in America, the government claimed they would only be used in hostage situations. Today SWAT teams are used thousands of times a year, even for small-scale drug raids on non-violent suspects.

 

Prosecutors Pick a Target, THEN Find a Crime.

Practically anybody could be indicted for a crime if enough investigation went into their lives. There are so many laws, that we can’t go a day without breaking some statute.

Of course, most of us are not popular enough to draw the attention of U.S. prosecutors. But that is how they keep “the little guy” in line, by making examples out of the government’s enemies.

Reports indicate that Robert Mueller is on a fishing expedition to indict members of Trump’s team. If he can’t find any crimes, he will twist the law until something fits. Mueller and his team have done this in the past.

That’s the state of “justice” in America.

Fitbit and Pacemaker Info Used to Catch Criminals

Here’s the tough thing about Big Brother technology. In the beginning, it really is just used against actual criminals.

In one instance, a woman’s Fitbit, a watch monitoring her activity, cast doubt on her husband’s story. He said she was murdered by an intruder. He told the police a story about when she came home, what she did in the time before the supposed intruder showed up, and that she ran down into the basement. Based on information from the device, they could see the story was a fabrication.

In another case, prosecutors successfully subpoenaed information from a man’s heart rate monitor which proved he was awake when he claimed to be asleep before a fire started. He is going to trial for the arson, and a judge ruled that the evidence will be allowed to be presented.

The problem is the precedent it sets. Much like the SWAT raids in the example above, this information may at first be used to solve arsons and murders.

But what happens when it is used to fish for crimes instead? Or to frame someone in the wrong place at the wrong time?

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Meet The Eccentric, Euroskeptic, Czech Billionaire Who Will Become Prime Minister

The Czech election is taking place today, with the “Czech Donald Trump”, Andrej Babis, expected to be voted in as Prime Minister. As we noted last week, Babis is the Czech Republic’s second wealthiest person, is demanding the return of greater sovereignty from the EU, rejects the Euro and is against Muslim immigration. He has pledged to run the country like a business, while eliminating corruption. Oh, and he is also facing criminal charges for fraud. Babis’s anti-establishment party ANO stands for “Action of Dissatisfied Citizens” and is also the Czech word for “yes”.

Czech billionaire, Andrej Babis, and his wife Monika

The Prague Daily Monitor (PDM) reports that ANO is the clear favourite of (sic) the election that will take place on Friday and Saturday. Opinion polls indicate that ANO is likely to win two times more votes than the CSSD, which may be narrowly overcome by the Communists (KSCM) and possibly even the Freedom and Direct Democracy (SPD) movement of populist Tomio Okamura or the right-wing Civic Democrats (ODS).”

In last night’s final one-and-a-half hour televised confrontation, Babis sparred with Foreign Minister, Lubomir Zaoralek, of the social democratic CSSD party. Behind in the polls, Zaoralek didn’t pull his punches “Zaoralek called Babis a parasite in connection with the work of the cabinet. ‘He pretends that all that was good about the government was him,’ Zaoralek said in reaction to Babis’s criticism of the outgoing government that comprises the CSSD, ANO and the smaller Christian Democrats (KDU-CSL). Babis is a predator who insolently liquidated his competition, Zaoralek said. He said the financial authorities issued property-freezing orders that liquidated companies that were rivals of firms from the giant Agrofert holding (owned by Babis).”

Until May this year, Babis was Czech Finance Minister, but was forced to vacate the post by incumbent Prime Minister, Bohuslav Sobotka, due to “controversial financial transactions, alleged misuse of media against his political rivals and a suspected subsidy fraud.” Babis has been charged with transferring a 50 million koruna EU subisdy to one of his business interests. Babis claims that the allegations are untrue and deliberately made to remove him from politics.

Despite the allegations, Bloomberg reports that “the Slovak-born businessman solidified his popularity in the more than three years that he served as finance minister…Taking credit for the European Union’s lowest unemployment, one of its fastest rates of economic growth, and a balanced budget, Babis has portrayed himself as a competent manager struggling against traditional parties he brands as inept and corrupt. While that’s lifted his ANO party, his attacks against Muslim immigration and criticism of the EU have helped fuel the rise of anti-establishment political forces similar to Germany’s AfD and Austria’s Freedom Party. It’s also raised concern that he may follow the governments of Poland and Hungary, which have clashed with Brussels over democratic values.” One of Babis’s unconventional proposals is to make it compulsory for retailers to link cash registers to the Finance Ministry to increase revenue and reduce tax evasion.

Fraud charges aside, If Babis wins, it’s unlikely to be plain sailing for the new Prime Minister. The Bloomberg report quotes Prague-based political analyst, Jacob Charvat saying “It will be a very fragmented parliament, and it will make coalition talks difficult. There is also a great deal of personal animosity among politicians, which may complicate things further.” Based on last night’s TV debate, he’s not kidding.

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Key Charts: Gold is Cheap and US Recession May Be Closer Than Think

by Dominic Frisby of Money Week

Every year, Ronald-Peter Stoeferle and Mark J Valek of investment and asset management company Incrementum put together the report In Gold We Trust – 160-plus pages of charts and thoughts, mostly gold-related, on the state of the world’s finances.

There’s so much to look at and consider. It’s a sort of digital equivalent of a coffee-table book.

Yesterday I got an email from them, containing a “best of” – a compendium of some of the best charts from this year’s report.

I thought in today’s Money Morning, we might flick through some of them…

Commodities are very cheap compared to stocks

For those of you who have been, like me, despairing of the gold price these last five years, this first chart shows the average annual price of gold for each year.

Suddenly the last five years don’t feel quite as bad. In the mid-$1,200s is sort of normal (since 2008, at least).

Gold chart

This next chart got me very excited. It shows the ratio of the Goldman Sachs commodities index to the S&P 500 – the ratio of commodities to stocks, in other words.

Commodities are as cheap on a relative basis as they were in the late 1990s and at the beginning of the 1970s. In other words, very cheap indeed.

Gold chart

I’m quite bullish on industrial metals and energy at present. I think such “late cycle” assets will do well in  a stock bull market which is mature and, probably, a lot closer to the end than the beginning of its cycle. I don’t, however, think that commodities are the irresistible bargain they were in 1999.

The chart above, however, would suggest otherwise. It is screaming, “buy commodities, sell stocks”. The inference is that there is some inflation around the corner.

Could a US recession be around the corner?

Here’s one for the contrarians: in a recent Bloomberg survey, not one economist out of 89 expects a US GDP contraction in 2017, 2018 or 2019. Meanwhile the Vix (the index of volatility) is at all-time lows. There is, in short, a heck of a lot of complacency out there.

Gold chart

Are we now in a rate-hiking cycle? In the US we seem to be, even if interest rates now stand at only 1.25%. The Bank of England meets next week. Inflation, as judged by the Consumer Price Index (CPI) – the Bank’s target  measure – came in at 3% yesterday, the last report before the Bank’s meeting. Surely even Mark Carney has to put up rates now.

That could be a significant turning point. According to this next chart, 16 of the last 19 rate rise cycles have led to recessions.

Gold chart

That doesn’t necessarily mean that interest-rate rises cause recessions – often it’s the over-expansion caused by the loose monetary policies which preceded the rate rises – but nevertheless there does seem to be some kind of relationship. Perhaps more rate rises could result in the recession that nobody is forecasting.

Following on from that, the next chart hints that all is not as well with the economy as we might believe. As someone who did a show at the Edinburgh Festival on tax and is now writing a book on the same subject, any cool tax charts are bound to get the blood flowing, and this is no exception.

The S&P 500 may be rising – but gross tax revenues aren’t. The amount of tax being paid, whether on a personal or corporate level, is indicative of how much people are earning and how much economic activity is taking place. Tax receipts are in decline. The omens are not good.

Gold chart

You could draw the same chart for net corporate tax receipts. The pattern is the same.

It’s another hint that the economy is not faring quite as well as the stockmarket suggests it is.

What if gold were money again?

Finally some charts for the hard money advocates.

The first shows, basically, the ratio of the money supply – ie, the amount of money that has been printed – compared to savings.  The higher the blue bar, the less money is being saved.

Gold chart

If the narrative of this chart is believed, this is not going to end well – although I stress that you could have made the same point in 2014, 2015 and 2016 , so perhaps we will be making the same observation for another three years.

Lastly, some simultaneously sensible yet ridiculous projections of the gold price in the future.

During the 1980 Iranian hostage crisis, gold went to $850 an ounce – for a day. On that day – 21 January – the US dollar was, effectively, fully backed by gold. At $850 an ounce, the market value of the 260 million ounces of gold owned by the US and mostly stored in Fort Knox (don’t mention the audit) reached $221bn. Yet only some $160bn paper dollars were in issue.

So US gold was actually worth 140% of US paper. So low was confidence in the dollar (indeed all paper money at the time), that the US had, in a way, been put back onto a gold standard. One Zurich banker declared: “The US Treasury is once again solvent, thanks to the high price of gold”.

Many gold bugs – including yours truly at one stage – were waiting for that day to come again. Because money supply and debt are so high, central banks will lose control, confidence will be lost and gold will soar as a result.

I now see such a scenario as most unlikely – though I stress it has happened many times before, so there’s no reason it can’t happen again. And in such a light, we consider the table below.

There are all sorts of different measures of money supply.

M0 and M1 are basically cash and other money equivalents that are easily convertible into cash. M2 is M1 plus short-term time deposits in banks and money market funds. M3 is M2 plus longer-term time deposits and money market funds. The exact definitions vary from country to country.

The following table shows what price gold would be if it were equivalent to 20%, 40% or 100% of the various measures of US money.

Gold chart

In the event of some kind of fiat crisis akin to that of 1980, the numbers start getting pretty big. 140% of M1 – the intraday 1980 number – would give us a gold price somewhere near $18,000. Nice work if you can get it. Although I imagine bitcoin will get to $18,000 long before gold does.

But this all makes the assumption that, at some stage, prevailing attitudes to gold – that it is an analogue relic in a digital world – will change. And that it will be ascribed some kind of value as money in extremis. I’m not so sure that day will ever happen, or at least not in the near term. Others will disagree.

In any case, the main takeaways from the charts are then that both gold and commodities are cheap, relative to both money supply and to stockmarkets; and that, based on tax receipts, contrarian forecasting and rate cycles, some kind of contraction is more likely than many think.

Food for thought, I think you’ll agree.

 

News and Commentary

Gold prices hold firm as dollar sags (Reuters.com)

Dollar Gains, Treasuries Fall on U.S. Tax Hopes (Bloomberg.com)

Asia-Pacific stocks start lower, edge back into positive territory (MarketWatch.com)

Trump leaning toward Powell for Fed chair, officials say (Politico.com)

Gold purchases on Moscow Exchange won’t change reserves’ outlook – Russia (Reuters.com)


Source: ZeroHedge

How one of the first big property bubbles led to the Great Depression (MoneyWeek.com)

Warning of ‘ecological Armageddon’ after dramatic 75% plunge in insect numbers (Yahoo News)

S&P 500 Is Now Overvalued On 18 Of 20 Metrics (ZeroHedge.com)

2 Charts Show S&P A Bubble and Risk of Crash (ZeroHedge.com)

China’s Greater Bay Area gets a big green light (StansBerryChurcHouse.com)

Gold Prices (LBMA AM)

20 Oct: USD 1,280.25, GBP 974.27 & EUR 1,084.76 per ounce
19 Oct: USD 1,283.40, GBP 975.64 & EUR 1,087.42 per ounce
18 Oct: USD 1,280.65, GBP 972.53 & EUR 1,090.47 per ounce
17 Oct: USD 1,289.70, GBP 973.47 & EUR 1,097.02 per ounce
16 Oct: USD 1,305.15, GBP 981.08 & EUR 1,107.03 per ounce
13 Oct: USD 1,293.90, GBP 972.88 & EUR 1,093.73 per ounce
12 Oct: USD 1,294.45, GBP 977.96 & EUR 1,092.26 per ounce

Silver Prices (LBMA)

20 Oct: USD 17.08, GBP 12.96 & EUR 14.46 per ounce
19 Oct: USD 17.03, GBP 12.93 & EUR 14.40 per ounce
18 Oct: USD 16.95, GBP 12.86 & EUR 14.42 per ounce
17 Oct: USD 17.11, GBP 12.96 & EUR 14.55 per ounce
16 Oct: USD 17.41, GBP 13.09 & EUR 14.75 per ounce
13 Oct: USD 17.20, GBP 12.94 & EUR 14.55 per ounce
12 Oct: USD 17.20, GBP 13.06 & EUR 14.50 per ounce


Recent Market Updates

– How Gold Bullion Protects From Conflict And War
– Silver Bullion Prices Set to Soar
– Brexit UK Vulnerable As Gold Bar Exports Distort UK Trade Figures
– Puerto Rico Without Electricity, Wifi, ATMs Shows Importance of Cash, Gold and Silver
– U.S. Mint Gold Coin Sales and VIX Point To Increased Market Volatility and Higher Gold
– Global Outlook – Mad, Mad, Mad, MAD World: News in Charts
– Young Guns of Gold Podcast – ‘The Everything Bubble’
– London House Prices Are Falling – Time to Buckle Up
– Perth Mint Gold Coins Sales Double In September
– Survey shows UK and US Pensions Crisis is Imminent
– Gold Investment In Germany Surges – Now World’s Largest Gold Buyers
– Yahoo Hacking Highlights Cyber Risk and Increasing Importance of Physical Gold
– Safe Haven Silver To Outperform Gold In Q4 And In 2018

Important Guides

For your perusal, below are our most popular guides in 2017:

Essential Guide To Storing Gold In Switzerland

Essential Guide To Storing Gold In Singapore

Essential Guide to Tax Free Gold Sovereigns (UK)

Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

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Spain Activates “Nuclear Option”: Will Seize Control Of Catalan Government, Force New Elections

Spanish Prime Minister Mariano Rajoy asked lawmakers to grant him unprecedented powers to force leaders of the Catalonia region to cease their independence push, a dramatic escalation in the confrontation between Spain and the separatist region, which the WSJ – and virtually everyone else – has said will be a major test for Spanish democracy.  According to The Spain Report, this
is the first time in the modern democratic period that a central
government has suspended home rule in one of Spain’s 17 regions.

Spain’s PM Mariano Rajoy unveils plans to curb powers of Catalan government https://t.co/0vMMTK8oCQ pic.twitter.com/KbKgHnqPv1

— BBC Breaking News (@BBCBreaking) October 21, 2017

Rajoy announced that his central government would use Article 155 of the Spanish Constitution to remove the Catalan president, Carles Puigdemont, and sack the entire Catalan regional government as part of a barrage of actions, and force new elections on the region within six months. Summoning the sweeping powers of Article 155, Rajoy said Saturday, was a last resort. 

Puigdemont and his regional administration will be removed from office once the Spanish Senate approves the government’s plan as soon as this week and Spanish government ministers will take over the management of the Catalan administration, Rajoy said according to Bloomberg. The responsibilities of the Catalan government will be administered in the interim period by central government ministries. Furthermore, the Catalan Parliament will not be allowed to present a new candidate for First Minister, to prevent Puigdemont from being reappointed.

Rajoy said “This is not a suspension of home rule but the dismissal of those who lead the regional government”. The Spanish Senate will be in charge of controlling the process. As a result, Rajoy said Spain’s central government would temporarily control Catalonia’s regional ministries until new elections are called. The prime minister said he is seeking to convene regional elections within six months.

PM Mariano Rajoy: Spain plans to remove leaders of Catalan government but not dissolve regional parliament https://t.co/8916oi25Yg pic.twitter.com/bFlytoUqjW

— BBC Breaking News (@BBCBreaking) October 21, 2017

“The First Minister of the Catalan government was invited to parliament and he did not accept”, said Mr. Rajoy, in a long press conference following an extraordinary cabinet meeting on Saturday, adding that Catalan leaders had tried to “impose” their will on the central government.

“We are going to work to return to normality,” Rajoy said, as car horns sounded in downtown Madrid. “We are going to work so that all Catalans can feel united and participate in a common project in Europe and the world that has been know for centuries as Spain.”

Rajoy also said that “the economic recovery is under an obvious threat because of Catalonia,” during the Madrid press conference, and said that “this is about peoples lives, jobs, salaries” as “Companies are fleeing” and “data on tourism is also worrisome, the tensions are deterring visitors.”

The “most anti-democratic part” of the past few weeks was “what happened in the Catalan Parliament on September 6 and 7”. “Dialogue is a lovely word”, said the PM, but “Dialogue does not mean the others have to accept your demands”. “Dialogue outside of the law is deeply undemocratic”.

Rajoy said there were four aims of applying Article 155 in Catalonia:

  • to return to the rule of law,
  • to get back to normality and “coexistence”,
  • to continue with the economic recovery, and
  • to hold elections in a situation of normality.

He said the six-month period before elections was the maximum period of time he would like to see pass before a new vote. The PM also said the Article 155 can now only be stopped “if the Senate does not approve it”, which however won’t happen as the governing Popular Party holds an absolute majority in the Spanish Senate.

Rajoy thanked two opposition parties, the Socialists and Ciudadanos, for their support for the measures, and said that Saturday’s announced measures had been hammered out in recent days with leaders from two of the main oppositions parties, a sign of the widespread political support for the prime minister’s bid to halt Catalan authorities’ accelerating steps to secede from Spain.

As Bloomberg notes, the move may be “a watershed moment for Spain and its 1.1 trillion euro ($1.3 trillion) economy, which counts on Catalonia for a fifth of its output.” Hundreds of companies have already set up headquarters elsewhere in the country to avoid a legal limbo that emerged after Catalan leaders on Oct. 10 claimed the right to an independent republic.

And now that Spain has ended the game of cat and mouse, and effectively pulled the plug on Catalan independence, with the central government’s measure due to come into force within days Catalan leaders are due to meet Monday to discuss whether to push ahead with a unilateral declaration of independence. With Madrid having taken the first step, Puigdemont now has the liberty of playing the “oppression” card, even if Spain explicitly stated it is not suspending Catalan autonomy, so the semantical war of words will continue, although for the separatist movement the time has now come to either officially declare independence or end the process.

The question is what happens should the Catalan leaders follow through and declare Catalonia is independent, forcing retaliation, perhaps violent, from Spain. The answer will be unveiled shortly: the Catalan President will make a statement at 9pm according to a spokesman, and Puigdemont also attend a demonstration in downtown Barcelona at 5 p.m.

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