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Why Can’t We All Just Net Along

Zero Hedge posted an article that asks an interesting question. Every European country owes money to other European countries. This creates a web of cross-linked debt. Instead of each country laboring under the full nominal amount, why don’t they just cooperate and cancel out everything but the net debt? This remainder would be very manageable […]

The Fed’s Decision: “Operation Twist”

For months, even before the end of QE2, analysts and prognosticators have been saying the Fed will have to do another QE and another, endlessly. These folks were surprised when it didn’t come last month, and predicted confidently that it would come this month especially because Bernanke extended the September meeting to two days. I […]

Banning Short Selling

In fall, 2008, the US banned short selling of certain stocks. It triggered a massive short-covering rally. Then, without the shorts in the market, prices went into freefall. When prices are falling, the shorts (when taking profits) are the only bidders. Markets don’t crash because of short sellers. They crash because the bid is withdrawn. […]

The Standard & Poor Downgrade of Uncle Sam

By now, everyone knows that S&P downgraded the debt of the USA from their top rating, AAA, to their second-highest grade, AA+. Most of the commentary has been of the pin-the-blame-on-the-donkey variety. For all most people know, this is the collapse of the currency and the financial system and their biggest concern is that Obama […]

Gold Conspiracy Theories

One of the conspiracy theories that’s popular in the gold community right now is that when the CME and various brokers increased the margin required to hold silver, this caused the price to fall from $49 to $34. Of course, observing the silver basis does not confirm this claim. Today, Zero Hedge has a short […]

Open Letter to Ted Butler

Dear Mr. Butler: I read your article about silver manipulation at 24hgold.com. I am responding as someone who wants free markets. I want to make one thing clear before I proceed. We have no free markets anywhere today. Without constant government intrusions into the markets, the paper currencies would have collapsed already, and there would […]

Debunking Gold Manipulation

Yesterday [Nov 29, as I wrote this on Nov 30], the December gold contract moved sharply into backwardation (it happened in silver also, but let’s focus on gold). This means that one could sell physical and simultaneously buy December to make a profit (please see the graph). So let’s look a little deeper. December basis […]

A Socialist’s Proposed Fix for the Economy

Charles Hugh Smith may not call himself a socialist. But I’ve always found this altruist, collectivist, populist undertone to his writing. Let’s see what he wrote today. http://www.zerohedge.com/article/guest-post-you-want-fix-us-economy-heres-start He has an 8-point plan to fix the economy. The first thing I’ll note is that he does not address the punitively low rate of interest set […]