Tuesday, April 30, 2013

Dire Financial Condition of the Federal Government

"The debt ceiling was never much of a limit because it has been raised dozens of times over the years, but it did serve one purpose. It highlighted the lack of political will to get spending under control. Importantly, the dire financial condition of the federal government became apparent each time the ceiling was hit. The last time it was reached, the US lost its Triple-A credit rating."

- James Turk via a recent article here wrote, read the full article here:

Sunday, April 28, 2013

The US Economy and Gold

James Turk appears on the "Financial Sense" with Jim Puplava. They discuss the deteriorating US economy and the ongoing bull market in gold. 

- Source:

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Saturday, April 27, 2013

A Monetary Train Wreck is Coming

"There is a financial and monetary train wreck coming, and it is not those who hold physical gold and silver who are going to be hurt. When asset price collapses like this occur you must eliminate your emotions. Just remember that this time will pass and the metals be trading significantly higher in the years to come.”

- James Turk via a recent King World News interview, read the full interview here:

Wednesday, April 24, 2013

Bigger Bank Failures on the Way

"It is important to note that the ECB could have avoided this mess by simply printing up several billion euros and giving it to the banks, in effect sweeping the mess under the rug. Instead, the eurocrats decided to play hardball. One has to ask why.

The reason for this is because they are getting ready for bigger bank failures. The Dutch EU minister said taking depositor money is going to be the template throughout the EU, which should send shivers up the spine of everyone, whether or not they have money on deposit in a bank."

- James Turk via a recent King World News interview, read the full interview here:

Friday, April 19, 2013

Money, Gold, Bitcoin

"In the second half of the show, Max Keiser talks to James Turk about money, gold, bitcoin, currency wars and the nature of bank failures: to look good until the bank fails overnight. They also discuss Austrian school theories on money and how they relate to gold and to bitcoin."

- Source, Max Keiser.com:

Wednesday, April 17, 2013

Bernanke Will Risk Hyperinflation

“Mr. Bernanke is so anti-deflation he’s willing to risk hyperinflation, and we are on this path of hyperinflation given the policies we are following.”

- James Turk via a recent USA Watchdog interview:

Monday, April 15, 2013

Gold & Silver Smash, Monetary Train Wreck

“After the trashing given gold and silver the last two days, Eric, it is time to go back to the basics. So here are some of the many questions I have been asking myself, along with my answers, to see whether anything fundamental has changed in the outlook for the precious metals....

1) Is the Federal Reserve decreasing the quantity of dollars every month by $85 billion to bring about a deflation and enhance the dollars’ purchasing power? No, they are increasing the money supply by $85 billion every month, further debasing the dollar by transforming debt into currency.

2) Is the high level of unemployment being reduced so that more people are working and bolstering the economy? No, there are 113.3 million people employed in the US in private industry, or in other words, those employees creating goods and services for profit. Amazingly, it is fewer people than were employed in February 2006, over seven years ago.

3) Is the future of the euro secure? No, it is still hanging by a thread, moving warily from one crisis to the next. Importantly, we now know from the Dutch Finance Minister to the EU that confiscating depositor money in banks in Cyprus will be the template for future bailouts, meaning the uncertainty about the euro and European bank solvency remains at scary heights.

4) Is the yen going to strengthen to decrease the attractiveness of holding gold in that country? No, the Japanese government and central bank have laid out a blueprint to debase the yen even more rapidly than than the speed at which currencies of other industrialized countries are being debased.

5) Are all of the banks in the world solvent so that there will not be another crisis like Cyprus? No, many banks - including some of the largest in the world - are so financially weak and undercapitalised that if you take away central bank support like the ECB did to Cyprus, they would collapse just like the banks in Cyprus collapsed.
6) Are crude oil and gasoline prices matching the fall in the gold price this year? No, while gold is down about 18% since the beginning of the year, energy prices are basically unchanged for the year. By the way, the gold price this year has fallen less than Apple, which has dropped 21%.

I could go on with more questions and answers, Eric, but I think my point is clear. Nothing has changed except the gold price. And more to the point, the lower price makes gold ownership even more compelling. It is $240 cheaper, or in other words, better value than the $1600 price at which it traded at the beginning of this month. "

- James Turk via a recent King World News interview, read the full interview here:

Monday, April 8, 2013

Spain is Headed Off a Cliff

"GoldMoney's James Turk interviews Félix Moreno de la Cova, who is a studied economist, trader and GoldMoney contributor. They talk about the dire economic outlook for Spain and the country's fiscal difficulties.

Félix states that Spain is heading off a cliff with a fiscal gap of €150 billion a year. While government revenues declined after the pop of Spain's real estate bubble, government spending actually increased. He argues that must off the newly implemented "cuts" in reality are tax increases which will further slow the economy.

He doesn't attribute much likelihood to the idea of Spain leaving the eurozone. Rather he thinks that there will be more centralisation of power in Brussels with continuous bailouts of the periphery countries.

As long as the fiscal situation does not improve the on-going capital flight from Spain will lead to a further deterioration of Spain's economy. However Félix doesn't see the necessary political will and leadership which would be required to balance the budget."

- Source, Goldmoney:

Saturday, April 6, 2013

Creation of Money Out of Thin Air

"GoldMoney's James Turk interviews Prof. Pedro Schwartz who is the president of the Economic and Social Council of Madrid. They talk about bank regulation, the creation of money out of thin air and the beauty of the free market system.

They discuss how banks have expanded despite of government regulation which Schwartz in large attributes to the granted privilege of fractional reserve lending. Using this procedure a bank can create loans above the actual amount of deposits at hand and therefore create new money. This also leads to fragility in the banking system and to boom and bust cycles. Schwartz argues for a leaner and more effective regulation of financial markets as the current regulation has not worked in regards to the financial crisis.

They talk about the "tennis" between the Federal Reserve and the European Central Bank when it comes to the creating money out of thin air. Schwartz states that the ECB is disregarding the rules that were aimed to guard it from being influenced by political pressure. Despite the opposition of the German Bundesbank they are buying government bonds. This is equal to digital money printing and Schwartz scents that it is not being done for monetary policy, but for the stimulation of the economy which goes beyond the original remit of the bank.

However despite the injections of new liquidity by the ECB Europe is still in recession, because interbank lending has dried up. That means that banks are parking much of the liquidity back at the ECB. The big question will be what will happen to inflation once the economy starts to pick up again and those funds find their way into the real economy. Schwartz also questions whether it is a productive business when banks can make a profit by borrowing money from the ECB at 1% interest and then turning around to buy government bond which yield 5% or 6%.

A serious inflationary disaster will only be prevented if governments will succeed in reducing their deficits and stop selling bonds. Schwartz states that cutting government spending is the only viable solution to the problem. To accomplish this there has to be a change in social mentality so that people recognise that nothing is free and that the government sector has to shrink. In the end the market is the most efficient mechanism of allocating resources according to the wants and needs of people."

- Source, Goldmoney:

Thursday, April 4, 2013

Gold Price and the US Dollar

GoldMoney's founder James Turk gives a presentation on gold, silver and the United States Dollar. Listen to his forecast and his predictions.

- Source, GoldMoney:

Tuesday, April 2, 2013

It is Essential to Have Money Outside the Banking System

“What Cyprus makes clear is the realization that there is not enough money in the world to bail out the banks. So to keep the political experiment called the European Union alive, the oligarchs in Brussels have now resorted to stealing depositor money.

The important point here is if they can steal it in Cyprus, they can do the same in Spain, Italy or any other country where the banks are insolvent, and the reality is that most of the global banking system is insolvent. But sometimes it takes a while for a lesson to sink in. Some people began recognizing the counterparty risk that comes with bank deposits when Northern Rock collapsed in 2007, and the point was driven home again in 2008 with the Lehman debacle.

This crucial lesson is again being made clear from Cyprus, and the key point here is the one you and I have made time and again over the years: It is essential to have money outside the banking system, and the best way to do that is to own physical gold and silver."

- James Turk via a recent King World News interview, read the full interview here: