International
Forcaster US MARKETS American voters will not have much of a choice between the two major parties in the next election. Kerry and Edwards accuse the administration of misleading the nation and manipulating intelligence analysts to win support for the invasion of Iraq. No kidding you budding Dick Tracy’s. These two wonder boys, in spite of Bush’s actions, stand by their votes authorizing the war in Iraq. Thus, in their own way, they are as bad as Bush relative to the war because they went along with the program. Kerry, as of late, has expressed some skepticism, but he intrinsically believes in the phony war. Edwards has said nothing, but I am sure he will follow the elitist line. What else would Edwards do, just having been given his marching orders at the recent Bilderberger secret enclave in Italy? All four candidates want an opportunity to kill your children and grandchildren. No matter what Kerry says, he knew a year before the war started that George and the neocons were committed to war; yet he still cast his vote to begin the slaughter. Kerry’s comment has been, “The vote was the right vote at that moment in time and we do not deal with hypotheticals. We deal with realities.” John Kerry has never in his life dealt with realities. He is just as big a liar as George W. Bush. Kerry had to know the war was a scam. There were no intelligence failures, just Bush distortions, and ready acceptance by our Senators and representatives to engage us in invasion and occupation. As you can see, we have two illuminists to choose from and that, for us, is no choice at all. As you all know, we have a lunatic in the White House, but what are we going to trade him for? John Kerry is unfit to be president, just as George W. Bush is unfit to serve. Regarding Kerry, just ask the Swift Boat Veterans for Truth. It consists of 19 of 23 officers who served with Kerry. His detractors range from seamen to admirals. Kerry seems to be as universally despised as George W. Bush is. A former Army reservist who returned to civilian life in December, only to be recalled five months later, has filed a lawsuit to avoid duty in Iraq. He served four years of active duty and another four years in the reserves, a commitment he believed expired on 12/19/03. The Army maintains he will be in a voluntary reserve status until he is 50. The Army says he did not formally resign, and he says he did knot know he had to. He feels like he was being drafted without a draft being instituted. We call it imprisonment or involuntary servitude. The upcoming election presents a quandary for many voters, particularly Republicans. The empty promises, lies and deception have been devastating for those who voted for what turned out to be George and the neocons. It is an assembly of Marxists, Leninists, socialists, liberals and fascists, but virtually no one from the real right-wing. This cabal has formed a government that has all the trappings of Nazi’s in the 1930s. This is a devastating disappointment for those of us who have been inside the political mechanism for almost half a century. With that said, Americans have got to start thinking in terms of a third party. We know it is difficult, but we cannot stand and vote for our own demise. Both candidates are members of the Illuminati and its only chapter in America, the “Skull and Bones.” No matter what they profess, both men are Satanists. Voting for them is voting to allow evil into our lives; a vote to allow evil to continue to control our country. Both Republicans and Democrats have to leave their parties and vote independent. Your vote for either of these people is a vote to continue to have your lives run by people who will destroy your way of life, and get your children and grandchildren murdered in the process. Are we to continue to reward evil? Both parties want war, free trade and globalization and massive continued illegal immigration. They both want to continue the massive exodus of manufacturing and services and the outsourcing of some of our best jobs. They are both for the destruction of entire industries so transnational elitist conglomerates can get richer and exert more and more power over our lives. Some believe this is an agenda. It is not. It is a conspiracy to destroy what is left of the American republic and force Americans to accept one-world government. A major move is on by the elitists to get Americans to trade liberty for security. As we predicted months ago, officials are discussing the postponement of the next election in the event of a terrorist attack. Fatherland Security will be the moving party. We told you if George and the neocons were either close or behind in the elections they would declare martial law due to a terrorist event that they planned and executed. Just like Pearl Harbor and the burning of the Reichstag. The man who “brought” the issue to the attention of Fatherland Security, Secretary Tom Ridge, was De Forest Soaries, Jr., Chairman of the US Election Assistance Commission. These and other Republicans see this as a prudent effort to plan for doomsday scenarios. Of course, no matter what the conditions, these statutory elections should go ahead on schedule. They should not be changed. Both Soaries and Ridge are mouthpieces for Bush. The cancellation of elections would be a prelude to dictatorship. The absence of elections would send the dollar lower due to the inherent problems engendered in such a situation and, of course, gold would head higher. Listen and listen well, every husband and wife and child over 12 should have an assault weapon, 10 clips and 1,000 rounds of ammunition per weapon. You may well need them. Interest rates, as we predicted months ago, will climb at least four percent perhaps five percent. A four percent increase would put the Fed funds rate at five or six percent. That would put US 10-year Treasury notes at 8-1/2 to 9-1/2%, and that would put 30-year fixed rate mortgages at 10 to 11%, up from 6% presently. We hear all these stories as to why this could not happen. We have news for the experts: the Fed in time will not be able to control interest rates as foreigners finally sell US debt. Even mainline media cannot hide the facts on statistics, particularly inflation. Business Week tells us, “The percentage of companies paying higher prices rose 88% in April.” The Kiplinger Report says, “Building supplies has also escalated with the average cost of materials adding as much as $7,000 to the price of a new home. These readings are the highest since the 1970s, when the economy was beset by surging inflation.” Forbes says, “73% of all corporate purchasing agents report that the prices of the goods they buy are rising.” Many companies are just now passing along higher commodity prices on to consumers. As you can see, inflation is far higher than the government admits. Almost 70% of Americans own homes. If they fall just 10% in value, consumers will quickly cut back on spending and that correction will feed on itself. Whoops, there goes the housing bubble. Once companies and consumers start anticipating rising prices, they will act in ways that will feed the inflationary spiral. Then we have to consider the unwinding of the carry trade as a result of higher interest rates; as that unwinds it will force rates even higher. A prime example is Fannie Mae and Freddie Mac, which control 72% of the mortgage market. How will they fare as rates rise? We believe they could well collapse. What about the highly leveraged funds? Many of them could go under. There are so many problems waiting in the wings it is overwhelming. Interest rates and a falling dollar are a gigantic problem, but inflation is now the most immediate problem, and the Fed has not been doing what it should have been doing for almost a year. From here on out inflation will be on everyone’s lips. It will stagger the economy and the financial system, and it will now be the major force that drives gold. Investors are about to find out over the next couple of years that the gold bull market is for real, and they had best join us or pay the consequences. Piper Jaffray was fined $2.4 million by the NASD for defrauding the public by “spinning” hot IPOs between 1999 and 2002 and offering those shares to special insiders and 22 corporate executives who, in turn, kicked back investment banking business. The 22 corporate crooks made $2.4 million in profits. Hedge Funds have a lot of brass lobbying congress to block the SEC from increasing oversight of the $850 billion industry. LTCM is a perfect example of what can happen to hedge funds and we are fed garbage by Sir Alan Greenspan and purchased politicians. Just to give you an idea, registration would add 1,000 new hedge funds to the SEC’s inspection workload and that is good because the SEC should be controlling what they do. It is insane not to have the SEC regulating an industry that is leveraged to the eyeballs and one that could bring down the financial system. The reason the Fed and the elitists do not want regulation is because they tip off the hedgers indirectly, and they unknowingly help the Fed elitists to manipulate markets. 2005 will be a difficult year for the US and global economy as they descend economically and financially. The global policy of stimulation will have played itself out. Tremendous deficits in the US, Europe and Japan will probably cease to expand as the year progresses. The first to recede will be the production of durable goods. That will be followed by a fall in capital spending and a decline in home building, which will be followed by a decline in real estate prices. The latter two will become victims of higher interest rates. The very integration that the elitists bought about through free trade and globalization will be its undoing. The falling dollar will bring massive losses to its holders and US current account and fiscal deficits will go into default as 2006-2007 appears. Payback is finally beginning. You cannot create prosperity by printing money. The Fed raised Fed fund rates by one-quarter percent to 1-1/4%. Usually that would strengthen the dollar. Since the rise, the dollar has fallen 4.3%. The reason is that US debt is finally overwhelming good news, in this case higher interest rates. The key element relating to the dollar’s weakness is the current account deficit, which is headed for $600 billion this year, or 6% of GDP. Net liabilities amounted to 24% of GDP last year. US 10-year Treasury Notes are yielding about 4.5%. If those rates or yield moves up to 6%, that would add 1% of GDP to the current account deficit in just a few years. At 8-1/2%, a 4% move, would probably add 2.75% to the deficit sending it to 9.75% at current rates of import consumption. That is unsustainable. This is why it is impossible for the US economy to continue to be the locomotive of world growth. The ability of Americans to borrow from foreigners is nearing an end. The overly conspicuous consumption will end this year and consumers will have to start saving again. Just 3-1/2 years ago the deficit was only 3.2% of GDP. If the Fed continues its wanton, promiscuous creation of money and credit we could see a deficit of 7% of GDP, with 14% inflation, before the end of 2005, even with interest rates having risen 3 to 4%. The only way that could occur would be for central banks and foreigners to take on more debt. We do not see that happening because foreign direct investment was negative by $155 billion over the past 12 months. Not surprising when net returns were only 5.5% for those investors when they made 11.7% at home. Overall, net investment in US Treasuries and agencies has almost exclusively been China and Japan to keep their currencies from rising. There purchases have since moderated and the Fed has been forced to buy more Treasury paper. This monetization is immediately inflationary. We do not see central banks continuing to purchase over 30% of US Treasury paper in the immediate future. If we are right, inflation will rise strongly soon. The New Yorker Magazine in the Talk of the Town section has an expose on Dick Cheney’s personal physician who was fired by Cheney for drug use. However, after reading the article, we believe the drugs were for Cheney. He is in all likelihood a manic-depressive. On drugs, in another vein, Conrad Black takes drugs supposedly for migraine headaches, but we suspect they are taken for other reasons. These two are both elitist Jekyll and Hyde characters. That would explain their irrational behavior. If we may quote the New Yorker, “Deposition testimony shows that when (Wasserman-Malakoff’s) learned of the fake prescriptions and the drug use, he referred Malakoff to two specialists. According to Wasserman, one determined that Malakoff was not a danger to his present patients. The other testified that Malakoff told him he had taken approximately 150 urine tests and passed them all.” That means Cheney in all likelihood was the drug recipient. This story has explosive written all over it. The Philippines said it would withdraw its troops from Iraq ASAP to save a Filipino hostage threatened with death by insurgents. Three more American soldiers were killed last Monday bringing the death toll among foreign nationals in Iraq over 1,000. US forces have lost 889, of which, 665 were killed in combat. This does not include mercenaries. First rate economist A. Gary Shilling tells us the Fed is fighting ills largely of its own making. The first quarter-point increase in the funds rate has the Fed trying to unwind years of leaping financial leverage and speculation and there will be heavy casualties. Just as we said at the time, Mr. Shilling says, in December 1966 as he made his irrational exuberance speech that all Mr. Greenspan had to do was raise margin requirements to suppress the dot com bubble, a bubble rivaling that of the late 1920s. He started to tighten 2-1/2 years later, which was far too late. As stocks collapsed, the credit authorities shifted to massive easing to save the economy from a horrible recession and to fight deflation. We might add that instead of accepting recession they flooded the system with aggregates and lowered interest rates to 1% setting the economy up for hyperinflation followed by depression. A nationwide fall in house prices, the first since the 1930s, would be devastating to 69% of American households that own their own abodes. Big mortgage financiers Fannie Mae and Freddie Mac with $1.7 trillion in debts, could require government bailouts. In 2000 and 2001 investors switched from equities to hedge funds, which leverage their $800 billion with derivatives and doubled-up trades. They and others have piled into the carry trade. They have had a picnic borrowing short and lending long, where yields were higher. Open interest in 10 and 30-year Treasury futures contracts as a percentage of outstanding issues rose from 15% in early 2001 to 35% recently. They also borrowed cheap short-term money to buy commodities, foreign currencies, US junk bonds and emerging market debt and equities. In April, in anticipation of higher interest rates, copper, which had moved up 110% due to US home building and global growth, fell 15% and interest rates rose 1-1/4%. The speculators are still in their trades in a leverage scenario much greater than in 1994. For example, overnight borrowing to finance fixed-income investments, in relation to the total size of the fixed-income market, has doubled since then. Which large financial institutions might succumb this time? Hedging techniques are better than they were 10 years ago but remember that hedging can transfer risk but not eliminate it. Weak desperate players are assuming big financial risk. To avoid appearing impotent, the Fed must confirm market anticipations with much higher rates and that could hurt leverage speculators who have been encouraged by Fed inaction and actions since 1996 to bail out. These are worrisome times that require equity investor caution. Mr. Shilling believes if troubles come, Treasuries will benefit as safe havens amid, he expects, a shift from inflation to deflation fears. Thank you Mr. Shilling. We believe euro and Swiss franc denominated CDs or Treasuries offer a better alternative. We are a little disappointed he did not mention gold and silver shares, which he knows are places of safety. Frank Quattrone was railroaded by the judge’s
instructions just as often happens in tax and other cases. The former CSFB
banker was convicted of obstructing
justice. The judge denied him a new trial. This is a good example of American
justice today. Probably the most toxic of derivatives is the $5 trillion market in the securitization of debts and bonds. A CDO is a collateralized debt obligation and a CBO is a collateralized bond obligation. Making a directional bet and have it go wrong is not difficult. We saw that with LTCM, which was leveraged to the hilt. Once Russia defaulted, they had to liquidate everything to stay solvent and then that was not enough. Another $5 billion was needed so the failure would not take down the financial system. LTCM was run by the people who wrote the book on derivatives. Sir Alan Greenspan likes derivatives because they spread the risk. Our thought is, yes everyone goes under instead of just a few. The problem lies with those who guarantee CDOs and CBOs. Insurance companies package debt and put a guarantee on it even though it is second-tier debt. They package junk and give it an A rating because they guarantee it. The problem is the concentration of guarantees within a small group of insurance companies. This is why Warren Buffett has called derivatives “financial weapons of mass destruction.” It’s a daisy chain of risk default; one goes they could all go. For buyers they buy a liability that looks like an asset, and all of a sudden, it is not an asset anymore. Those who have guaranteed the debt of the US government, Fannie Mae and Freddie Mac are running tremendous risks. There is a long history of complicated miscalculations. The derivative bomb is sitting there just waiting to go off and some time over the next several years it will explode. Our spies in Detroit tell us the big three automakers are in serious trouble, and are canceling supply contracts left and right. They tell me that they have never seen such a bad situation in the last 40 years. Applied Digital has confirmed that the AG of Mexico and some of his staff have received a Verichip for security applications. About the size of a grain of rice, Verichip is the world’s first sub-dermal RFID microchip that can be used in a variety of security, emergency identification and other applications. Wait until the average Mexican hears about this. Business Week says US corporations
have built up $1 trillion in unfunded pension liabilities. This, of course,
spells real trouble for companies and employees,
particularly the older companies who have built large pension and medical
liabilities. Worse yet are the unfunded liabilities of the US government,
some $45 trillion.
The answer is either a 60% cut in benefits or print money to cover the
liabilities. The latter is wildly inflationary, but get ready because
that is what government
is about to do. Once this happens we will have hyperinflation followed
by depression. Our guess is the lunatic will call a state of emergency declaration if he decides to cancel the elections. He would at once bring FEMA, Federal Emergency Management Agency, into play and execute power over personal cars, trucks or vehicles of any kind, total control of highway, seaports, airports, aircraft, the national media, all electrical power, gas, petroleum, fuels, minerals and all food resources and farms. FEMA would have absolute power over health, education, welfare, and control of production, distribution, wages, salaries, credit and the flow of money in US financial institutions. The executive orders covering FEMA removes all constitutional protections and guarantees and deprives Americans of their Bill of Rights. George and the neocons can play on the fears of the populace, lowering voter turnout before any preplanned disaster happening. What is worse is that we as Americans are responsible for these wars created for profit and power by our politicians. George and the neocons deliberately are using fear to control the populace and control elections. Again, climb all over Congress and tell them we want no states of emergency, no FEMA, no constitutional chaos and that we demand elections, no matter what. New federal rules will remove overtime protections for at least six million American workers on August 23rd. The Bush administration rules represent a shameful assault on the paychecks of hard working Americans, most losing overtime are middle management. Congress has allowed itself to be deceived again and we have to suffer. In 2001 and 2003, Congress passed legislation providing a child tax credit for the middle-class that gradually rose to $1,000 per child, but Republicans excluded working-class children who need the help the most. In the 2003 law, families earning between $10,500 and $26,625 got nothing, including children of active-duty servicemen and women. About 25% of children, the children who needed help the most were excluded. Now they want to extend token benefits to the poor, but the trade off is a dramatic expansion of the tax breaks for well-to-do families with incomes of up to $309,000, or the richest 2% of the population. We promise you we are not liberals, but this is wrong. If you ever lived on welfare, as we have, and then have risen to the top of your profession, you can see both sides of the issue very clearly. The affluent get tax cuts of $1,000 per child and the poor $150.00 per child. That is anything but fair. All this is wrapped
in a bill
that makes the middle-class child tax credit permanent and gets rid of
the marriage penalty. The total 10-year cost is $500 billion. That
dear reader
is the height
of fiscal madness. The only thing that holds back this travesty is a small
group of moderate Republican senators led by Olympia Stowe of Maine. The
most serious
outrage here is that poor children who desperately need better schools,
better health care, and better early-childhood programs are getting
less than ever,
while the rich get more, which they hardly need. Previously, no one has ever received such an overwhelming response. They call this managed media and censorship. The company’s critics point out that the FCC is considering regulations that would make it easier for companies like Clear Channel to own more TV and radio stations. The station has also banned the Dixie Chicks last year after the groups lead singer, Natalie Maines, told fans during a London concert, “We’re ashamed the President of the United States is from Texas.” In 2000 and 2002 election cycles, the company and its officials donated slightly more than $300,000 in unregulated money, most of it to Republicans. Tom Hicks, the Texas Ranges owner, who has long-time ties to Mr. Bush, is a top executive at Clear Channel. The company has a long record of suppressing speech with which they do not agree. Now all you George Noory fans know why we have not reappeared on his program. Nearly 150 conservatives listened in silence as a veteran of the Nixon, Ford and Reagan administrations ticked off a litany of missteps in Iraq by the Bush White House. “This war is not going well,” said Stefan Halper, a deputy assistant secretary of state under President Reagan. “It’s costing us a lot of money and isolating us from our allies and friends. This is not the cakewalk the neo-conservatives predicted. We were not greeted with flowers in the streets.” Some Republicans fear angry conservatives will stay at home in November or vote for a third party candidate, undercutting Bush’s reelection bid. Presently, 97% of conservative Republicans favor Bush over Kerry, which means conservatives still do not understand they are being played like a fiddle by the elitists. Fellow conservatives either vote third party or sit out the election. Otherwise, you are voting for the Illuminati. We predicted the Treasury would hit the debt limit of $7.384 trillion in September or October. Timothy Bitsberger, the Treasury nominee for assistant secretary for financial markets, says the debt limit will be reached in October. The NY Times says VP Cheney is changing doctors and the new doctor will supply a medical-heart-report that compels Cheney to not run for reelection. The media will circulate McCain and Powell as their preferred candidates. It just goes on and on. Riggs Bank helped Augusto Pinochet hid millions of dollars in assets from international prosecutors while he was under house arrest in Britain. The bank paid a fine in May of $25 million in civil penalties for willful, systemic violation of anti-money-laundering laws in its dealings with the embassies of Saudi Arabia and Equatorial Guinea. They are still under investigation. The bank attempted to use offshore and other accounts to hide Pinochet’s assets. Again, no one goes to jail. All the government is interested in is collecting money from lawbreakers. If you cannot pay then you go to jail. That is why very few are ever criminally prosecuted. HR 3283 will create a new annual nationwide “America the Beautiful” pass, costing $85.00 or more, as well as multiple layers of fees. Basic fees will be levied for access to all Forest Service, BLM, US Fish & Wildlife Service, Bureau of Reclamation lands and lakes, not just for the Park Service lands. Special fees will be required for campgrounds, boat launches, and special recreation permit fees will be needed for motorized recreation and for group activities. The bill eliminates the Golden Age Pass for seniors that allow them a lifetime entry into National Parks at a 50% discount. Penalties for recreation without a pass will increase to a Class B misdemeanor, punishable by 6 months in jail and or a $5,000 fine. George and the neocons are strongly behind this shameful bill authorized by Ralph Regula (R-OH) who has no public lands in his district. We own these lands and pay taxes to maintain them and now the administration wants to turn them into a revenue stream to fund their wars. Call, e-mail and write your congressmen and let them know you oppose this legislation. Since coming to office, George and the neocons have increased Treasury debt by 26.5% monthly, and in addition, consumers borrowed $879.9 billion in 2003, $775.7 billion in 2002 and in the first 22 weeks of 2004, the Fed created $501.9 billion. Over $150 billion was created in May alone. Annualized federal debt is increasing at an 11.6% rate, state and local debt at 9.6%, household debt at 10.999% and business debt at 4.1%. Household debt is now $1.1 trillion. As a result, the CPI is up 7.2% annualized and the PPI is almost at double digits. Credit market debt increased $2.733 trillion in just one year to $34.625 trillion. Since 1998, borrowings are up 255% of GDP to 302%. Total US mortgage debt is $9.618 trillion with annual borrowings of $2.733 trillion. The US must borrow 25% of its GDP just to stand still. If it stops, it falls into depression. If it keeps borrowing, it will collapse. This means ultimately that the creditor and the debtor both will collapse. As long as the Fed continues to feed money and credit into the system the elevation of interest rates won’t be effective until they are at least four points higher. Never before has the Fed ever created so many aggregates while it supposedly is slowing the economy with higher interest rates. Presently, it looks like Sir Alan Greenspan will continue this exercise until the monetary system collapses. Purchasing power is now being reduced by 7.2% annually, if you use government figures, our figure show 9.5%. Wages are not increasing at 7.2% or 9.5%. If this loss of purchasing power continues, that means interest rates must rise to these levels. That means a 3% to 5% increase in interest rates just to hit equilibrium. That means a depression. It also means debt holders will be caught holding the bag. This has also created a current account deficit of almost 5.2% of GDP, which foreign central banks won’t continue to fund indefinitely. They cannot because they are allowing the US to export their inflation to the foreign countries, particularly Japan and China. This means the dollar must go down in value. Once foreigners stop buying US assets and or sell them, then the dollar collapse will accelerate and that process began in the first quarter of 2004 when net foreign direct investment fell to an increase of $2.1 billion versus $321 billion in 2003. While this deterioration takes place, inflation is increasing, wages increase and so do interest rates. You talk about the worst of all worlds. This scenario surely was promulgated in financial hell. In addition, while your wealth is being stolen so is your freedom as our leaders form a corporatist fascist state. There has not been a way back financially, politically and economically for 3 1/2 years. The problem is now unfixable and it will end up in the streets. You ask where can you put your assets. The answer is in gold and silver coins and shares, and take delivery of your coins. Excess cash should go into Swiss franc and Euro paper and also have cash at home in small dominations. In addition, be well armed – it is your right as an American. Just remember what we have written every time you are stopped and asked for your papers. Remember, you are no longer allowed the right to silence in self-defense. You will cooperate. The government, due to privacy concerns and technical problems, is going to redesign its computer screening system known as, CAPPS II, which has already cost us $120 million. They have no idea when the new system will be ready for operation. In order to keep the economy afloat and the stock market from collapsing, the amount of money and credit issued from 2000 to2003 exceeded the entire amount of currency printed in the history of the country until 1990. If you remember, just a month ago we predicted the Fed would punish the bond dealers for shorting treasuries. The 10-year US Treasury note yield had been as high as 4.90%. When we made our comment, it was 4.70%. We said the yield would go to 4.35%. On Friday, it closed at 4.35%. A senior Summi cleric called on his followers to launch a holy war against the US Forces in Iraq and threatened to turn Ramadi into a graveyard for American troops. He called for a Jihad – a holy war. 2005 will be the fourth consecutive year that pay hikes will be below 4%. It looks like executives will get 3.7%, and employees and management 3.4%. That pattern will continue into 2005. That is not nearly enough with inflation at 9.5%. M3 dropped $60.2 billion and after revisions, the year-to-date figure is up $447.7 billion, or 9.8% annualized, down from 10.3% the previous week. Bank Credit rose $11.3 billion and it has expanded $290 billion during the first 27 weeks of 2004, 8.9% annualized. Real estate loans are up $171 billion year-to-date, or 14.8% annualized. Commercial paper is up $67.4 billion, or 9.9% annualized. ABS issuance jumped to $16 billion this past week, with year-to-date issuance of $310 billion, 33% more than in 2003. Year-to-date ABS issuance of $185.7 billion is running 73% above a year ago. Fed foreign custody holdings of Treasury & Agency
debt fell $1.5 billion to $1.234 trillion. Year-to-date custody holdings
are up $167.3 billion,
or 29% annualized. Banks and other issuers of asset-backed securities asked regulators to scale back a plan that would require them to disclose more information on investments, such as performance and delinquency rates. Trade protectionism is on its way and not a minute too late. The US just put tariffs on furniture and now has proposed imposing limits on the number of socks China can export to the US, joining brassieres and knit fabrics protected last year. This, of course, is to protect domestic businesses and rightly so, because if we do not the slave workers and their transnational conglomerate elitists masters will completely destroy our country. If we do not stop allowing this destruction, we all will end up as hunter-gatherers. Bubble mania - bubbles everywhere. Asset prices are now driving markets. Wages fall far behind inflation and job creation has been an abysmal failure. Real Estate internationally, which makes up 96% of the housing stock in the developed world, makes up housing bubbles in 25% of the global economy. Another 40% is on the verge of becoming bubbles. The world will soon have to come to grips with a post-bubble shakeout just like they did with the stock market in 2000. The biggest factor in housing is interest rates and they are headed higher from near zero rates the lowest in 50 years. The liquidity injection that allowed the housing bubble to happen has not vanished into thin air and it has begun to manifest itself in inflation. The current bubble countries are Australia, New Zealand, UK, US, Spain, Thailand, Russia and Argentina. Mortgage debt rose above 50% of GDP in 2002 in Australia, New Zealand, the Netherlands, the UK and the US. The withdrawal of those high values does not trigger economic growth but does indirectly create growth. That liquidity withdrawal will stop once interest rates move higher; if they do not move higher, massive inflation will ensue. Two-thirds of world housing is in a bubble that will soon burst and when it does there will be much unhappiness. The Posse Comitatus Act of 1878 prevents the military from intervening in civilian police and judicial functions. Legislation from the Clinton era and Patriot Acts I & II deliberately blurs the line between military and civilian roles. They allow military intervention in spite of existing law. The 1996 legislation allows the military to intervene in the case of a national emergency, such as a terrorist attack. The 1999 Defense Authorization Act allows military intervention whether there is an emergency or not. The Clinton legislation laid the legal and ideological foundation of the “war on terrorism,” which they knew was coming. Recently we have had three fabricated reports by the Department of Fatherland Defense known as code orange alerts. The terrorists are supposed to be al Qaeda, which is a CIA intelligence asset and the code orange alerts are disinformation exercises to keep the public on edge for an impending terrorist attack by our elitist controllers via George and the neocons. The environment of fear and intimidation is being set to get the public to accept the inevitable. When code red appears because of this phantom enemy, which in reality is the elitists and their assets, civilian government will be suspended and it will trigger a whole series of emergency measures. Fatherland Security has been training for this eventuality for more than a year. From the minute code red is issued FEMA takes over via the Northern Command. Thus, we are confronted with a coup once the terrorist act takes place. You will soon have a choice between freedom and bondage; the end of life as you have known it. You will either succumb or engage in insurgent warfare, because we will be living in a police state. You had best prepare yourselves. When we predicted a terrorist event and a national emergency and martial law months ago, nobody believed us. You have to believe us now because our worst fears are about to become reality. As the 1999 DAA law says, Northern Command does not even need the terrorist attack to take place. Just the possibility of such an attack allows them, FEMA and Fatherland Security, to go into action and essentially shut the country down. Do you get that; all the elitists need is a contrived red alert? That would be lawful justification for a fascist takeover. What we are facing is very real and can happen at any time. Seeing we have just had another bogus orange alert, we could be getting quite close to the reality of it happening. We are already in crisis. The coup could already be in progress. This is not just a George W. Bush neocon agenda. This is a conspiracy of both parties and the elitists who control them. As David Rockefeller said in 1994, “We are on the verge of global transformation. All we need is the right major crisis and the nations will accept the New World Order.” Are you getting the message? ***** This caught my eye on Yahoo’s In Play posting of 11:42 am today, Wednesday, July 14, 2004. The real question is how many people worldwide have already received the chip implantation knowingly or unknowingly and when will it either become mandatory (for security reasons of course) or be surreptitiously implanted via vaccine or otherwise in the masses? Who knows? Maybe newborns are already being inoculated with the chip as a “value added” ingredient of the vaccine unbeknownst to their parents. After all, if Homeland Security has effectively made it illegal to discuss among family members and friends who it picks up without charge and imprisons members of society without legal counsel, then is it really a far step to inoculate citizens without their prior knowledge (for their own good and the good of the country)? We live in scary times where truth is evasive. ***** Layoffs are planned at the Federal Bureau of Prisons
in an attempt to cut costs. Over the past two weeks, gasoline prices
have remained unchanged
at
$1.96 a
gallon. Secretary of Treasury Snow says the Patriot Act is a key in combating
financial
terrorism. Twenty-eight percent of California’s unemployed have been
out of work for at least six months and long-term unemployment jumped to
43% in
the first four months of 2004 in San Francisco. Southern California was 25%
closer
to the national average of 22.9%. The old pre-approved overdraft lines of
credit has been replaced in some instances by bounced check loans where fees
can carry
interest of 240% or more. If you over draw your bank account by $100.00 and
the bank charges a $20.00 fee and you pay it back after 30 days that is 243%
interest. Imports rose to a record $143.1 billion. The trade deficit with China rose slightly to $12.1 billion. The Federal Reserve Bank of Richmond says in June the shipments index fell eight points to 14 and the new orders index declined 11 points to 1. The order backlogs index moved more solidly into negative territory losing 11 points to finish at -12 and the capacity utilization index gave up nine points to four. The vendor lead-time index was nearly unchanged at 14. The finished goods index fell three points to 15, while the raw materials index added one point to two. The index of expected shipments fell from 16 to 10 and the expected orders backlogs index fell five points to five. Vendor lead-time posted a seven-point loss to eight. Capital expenditures were unchanged. Manufacturer prices increased at an average annual rate of 1.99% in June, versus May’s 2.16%. Finished goods prices rose from 1.02% to 1.99%. Respondents expected supplier prices to increase at a 2.64% rate to May’s 2.66% during the next six months. They expect finished goods prices to advance at a 1.96% pace. All in all that is an absolutely dreadful report. The IDC technology consultancy expects outsourced finance and accounting functions to expand at a 9.6% compounded annual growth rate and top at $47.6 billion in 2008. The national price for regular unleaded gasoline jumped 2.2 cents a gallon over the last week to $1.917. Pump prices are $.40 a gallon higher than a year ago. West coast diesel was $2.04 a gallon, up $.31 from a year earlier. Overture will cut 10% of its workforce. Intersil will fire 200 workers by the end of the year. The average college student today probably knows less then the average person who finished the eighth grade in the last century. It is just another form of inflation. Ination Corp. will cut 280 jobs from 2,800 people worldwide. The MBA index of mortgage activity fell by 6.3% to 643.9 for the week ended 7/9/04 from 687 the previous week. The purchase index, a gauge of new loan requests for home purchase, fell last week by 6.4% to 468.8 from 500.9. The refinancing index fell by 6.1% to 1,662.4 from 1,769.7, despite a drop in mortgage rates. Thirty-year mortgage rates averaged 5.95%, down from 5.96% last week. The one-year adjustable arm averaged 3.93%, up 0.03%. ARMS are a trap and as interest rates climb, they become a bigger trap. ARM applications fell 13.4% to 4,451.9, from 5,138.8. The share of ARM applications filed last week was 31.5%, down from 34.1%. Import prices fell 0.2% in June, reflecting a broad decline dominated by lower oil costs. Retail sales for June fell 1.1%, the biggest drop since February. The auto industry is in real trouble. Consumer spending has dropped from 3.8% in the first quarter to 3.2% in the second quarter. Auto sales were off 4.3%, the biggest decline since February 2003. Purchase slowed to a 15.4 million annual rate in June from 17.8 million in May. In Phoenix, home resales hit 11,665 in June, up from 9,845 in May. The median house price jumped to $175,000 in June from $169,000 in May. June resales rose 47.8% from June 2003. The volume of sub-prime loans has risen from a total of $17 billion to over $195 billion today. No money down loans have ballooned from less than $1 billion to $80 billion. BofA is being investigated over the auction-bond market. Bayer will pay $66 million to settle a price-fixing suit. You notice no one goes to jail. The cost of malpractice insurance continues to drive doctors out of the US to mostly second and third world countries. We could have an exodus if the rules are not changed soon. The PPI, wholesale prices, fell 0.3% in June. The core rose 0.2%. Wholesale energy prices fell 1.6% after rising 1.6% in April and May. Food prices dropped 0.6% and auto prices increased 1.1% for the second month in a row. The prices of intermediate goods, June to June, were up 5.8%, the highest in nine years. Sony Music will cut 3,000 staff. The NY Feds manufacturing index rose to 36.5 from 29.9 in June. It hit a record 42.1 in February. The new orders' index rose to 36.5 from 26.2. Unfilled orders increased to 15.2 from 9.9 and factory shipments rose to 34.7 from 33.1. Employment rose to 14 from 12.7 and the survey for hiring over the next six months rose to 36.7 from 32.5. Prices paid rose to 56 from 52.1; the fifth consecutive month over 50 and the index of prices received fell to 19 from 20.5. Inventories rose to 5.2 from 3.4. US manufacturers lost 11,000 jobs last month. The workweek fell to 40.8 hours from 41.1 in May. Industrial production fell 0.3% in June after May’s 0.9% increase. Capacity utilization fell to 77.2% from 77.6%. Business inventories rose 0.4% as sales rose 0.7%. CPI increased 0.3% in June, a figure we certainly do not believe. Energy prices rose 2.6% versus +4.6% in May. Housing was up 0.3% and medical 0.3%. The June PPI fell 0.3%. Jobless claims were 4,000 worse than expected at 349,000 and continuing claims were 88,000 worse than expected at 2.971 million. Industrial production was a disappointing -0.3%. Last week was full of surprises, but not for IF subscribers. The 10-year Treasury note rallied again forcing the yield down to 4.355%, which is where we predicted the Fed would drive it in order to punish the dealers who were short. The drop from 4.70 to 4.35% is massive if you are short on 5% margin and holding millions of dollars worth of paper. Junk bonds saw an inflow of $339.6 million for the week as yields fell. Freddie Mac says the 30-year fixed fell from 6.01% to 6.00%, the 15-year from 5.42% to 5.40% and the one-year adjustable to 4.02% from 4.05%. The purchase application index fell 6.4% and refis dropped 6.1%. The average mortgage purchase was $213,100 and the average ARM was $285,200. ARMS accounted for 31.5% of applications. Los Angeles County home prices rose 32.3% in June to a record $414,000, the biggest increase in 15 years. This is the 12th consecutive month of prices rising over 20%. Adjustable rate mortgages accounted for 66.7% of purchases in June, up from 59.8% in April. The average Manhattan apartment topped $1 million to $1,047,938 in the second quarter, up 5% in the first quarter and 21% from a year ago. In North Texas home starts rose 10% in April, May and June. Baltimore home prices leaped 20.2% for the third month in a row and the average house sat on the market only 38 days versus 48 days a year ago. Sallie Mae reported income of $615 million up 65% from the year ago quarter. Student loan originations were up 24% from a year ago. Total assets expanded $2.7 billion, or 15 annualized. California teachers had the biggest paychecks in the nation at $55,693 and South Dakota had the lowest at $32,414. South Dakota has some of the highest average pupil test scores, while California had some of the lowest. COMMODITIES Early last week oil ran to a five-week high as US refiners pushed their production units to a 15-month high to satisfy consumer demand. It again went over $40.00 a barrel. There continues to be concern regarding violence, labor strife and political disputes in the Middle East, Africa, Russia and the continued attempts of the Bush neocons to overthrow the Venezuelan government. Refineries operated at 96.7% of capacity up 0.6% from the previous week. There has been a 3.9% decline in average daily gasoline production since the first week in May. Oil inventories held in east coast storage tanks and terminals fell by 2.2 million barrels as of 7/02/04 the lowest since 2/1/04. We expect gasoline prices will jump $.04 next week. Complicating matters, Statoil ASA’S refinery in Norway cut oil production 50% due to a fire. Norway supplies 449,000 barrels of gasoline to the US monthly, or 3.6% of US imports. As a point of interest, UK, Belgian, Swedish, Dutch and Italian refiners ship 3.9 million barrels of gasoline to the US monthly or 32% of the 12,325 million imported monthly. Crude inventories fell 2.1
million barrels for the week and gasoline inventories fell 200,000 barrels.
Oil prices on last Wednesday were approaching $42.00 a
barrel again and wholesale gasoline prices surged $3.07 cents or 2.4% to
$1.316 a gallon on the NYMEX. Heating oil futures rose 2.9% to $1.092 a
gallon. The
IEA expects global oil demand to increase 2.2% in 2005. Last week US refineries
operated last week at 95.2% of capacity. West Coast stockpiles dropped
by 1.4 million barrels to 52.4 million, the fourth decline in five
weeks. Inventories
are at the lowest level since 4/23/04. Crude shipments to US ports exceeded
an
average of 10 million barrels daily for an eighth consecutive week, the
longest such streak on record. Venezuelan President Hugo Chavez Fries has declared that the construction of a multi-pipeline running from Maracaibo to the Colombian Pacific Coast that will allow Venezuelan hydrocarbons to have a direct outlet to the Asian market. This will allow Venezuelan crude to be sold and shipped to China. Mr. Chavez says Venezuela will increase its oil production to five million barrels per day with $37 billion in investment for the next 10 years until 2009. It looks like copper is really on the move again closing at $1.314. Nymex heating oil traded at its highest level in 16 months, while the CRB index was unchanged, with year-to-date gains of 6.7%. GOLD SILVER, PLATINUM, PALLADIUM AND DIAMONDS Eighty-eight percent of investors and strategists advised
buying or holding the euro against the dollar. That is up from 67%
a week ago. If
the euro goes up
the price of gold will go up. Sixty-five percent of traders polled believed
gold was headed higher. Inventories of silver and gold continue to be depleted.
The bit of lying by Comex two weeks ago plus rule changes lead us to believe
inventories,
particularly
in silver, are reaching a critical stage. If you add in government lying
about inflation, growth, employment, etc. and now having no elections if
there is
a
terrorist event, all smack of a system that is out of control. Even during
the civil war, elections were held. That has to tell you the whole façade
is bogus and we are not far from real trouble. The fanatical hatred toward gold and silver and a gold standard continues to ooze out of Washington and Wall Street. Gold means sound money and freedom, which is something the elitists do not see in our future. Anyone who is pro-gold and silver is an enemy of the state, a terrorist. Our press has not been free for many years. All markets are manipulated 24-hours a day if the elitists find it necessary and any piece of data coming out of Washington is a lie. Ten percent of the people understand what is going on, 30% know something is wrong and 60% are lost in the wilderness and could care less. We call them sheeple. Our currency is fiat – worthless, and it is at least for now the world reserve currency. Sixty percent of the American public is simply dumb. The moment of truth is fast approaching – are they ready? On Wednesday last week, gold contracts rose again to 247,735 and silver stocks at Comex dropped to 116,469,425. In India, imports at State Trading Corporations rose 200% in the first quarter and MMTC, the biggest importers, saw a 284% rise. This past Friday, the euro moved up $1.245 on the news the May net capital inflows were $56.4 billion, down from $76.0 billion in April. This is the lowest inflow since October 2003. Foreigners, including central banks, are becoming more and more reluctant to fund America’s runaway debt. It also means that with the 10-year US Treasury note yield falling to 4.35% the Fed may have arranged for the Japanese to go into the market and run up the price of Treasury notes. It could also mean the short covering in Treasury’s is close to completed and now the dealers are going long bonds. Suppressing the dollar, which fell .84, was gold up $2.60 and oil up $0.63 to $41.25. Silver was also up $0.06 to $6.69, adding to the dollar’s woes. Gold and silver would be considerably higher if the market wasn’t manipulated. People just do not want to see what their government is doing to them. CANADA The trade surplus fell to C$5.22 million in May. Exports rose for a fourth month, rising 1.3%. Imports surged 7.8% from April, the biggest one-month gain since January 1997. After three interest rate cuts this year the Bank of Canada will raise rates in September to head off accelerating inflation. The previous cuts were to keep the Canadian dollar down. It wasn’t long ago that it fell from $0.78 to $0.72 and now it’s back up to $0.75.65. We expect next year it will rise further. The bank thinks it can keep inflation under 2%. They are sadly mistaken. EUROPE The risk of another run on Russia’s smaller banks is very high over the next three months. They are heavily invested in the property market, which is very overheated and very risky. Due to the inter-bank lending, there could be a common denominator of destruction. It is let’s make a deal in Moscow. Russian oil firm Lukos, backed by the Rothschilds, has offered $7.5 billion to settle its tax arrears bill on condition it be given three years to pay. Mikhail Khodorkowsky took on Putin and the KGB and lost. Yukos is history and its properties will be nationalized just as Pan American Silvers’ properties recently were seized. Westerners will just never learn. You cannot make deals with the Russians and the Chinese because there are no rules. Daimler Chrysler told its German workers that they might cut 6,000 jobs and shift some of the production of the new Class-C models outside Germany if its works council opposes deeper salary and cost cuts. Latest reports say $5 billion, or about 10% of all household savings have been taken out of the Russian banking system in the last two months. It is like 1998 all over again. Hardest hit was Alpha Bank, one of the largest, which lost about $500 million in deposits. Alpha’s main owner, Mikhail Fredman said plenty of assets were available to them from outside the banking system to back the bank’s efforts to meet demands from clients. We found it strange he did not name the source of the funds. Could it be the Rothschilds? Experts expect 200 of 1,670 banks to go under due to the measures taken by the Russian government. Like in Yukos, there is an effort to nationalize natural resource assets. In banking they are trying to drive foreign financed banks out of business to Russianize the banking system. We just received intel from Moscow that gold sales have picked up substantially. On the bright side, the Russian Duma approved long-over-due legislation that will guarantee deposits in uninsured, but not in failing and failed banks. It was passed unanimously. The legislation must now pass through the Federation Council and then be signed by President Putin. The European Court of Justice ruled that EU governments were wrong on the way they let France and Germany off the hook last fall for running up big budget deficits in violation of rules underpinning the euro. The impact of the mandate decision can be muted since the court said the rules could “de facto be held in abeyance” if the commission fails to muster enough votes among the 25 ministers to get disciplinary proposals enacted. The rules make the stability and growth pact a joke. The European socialists have absolutely no discipline. Russian industrial production rose at its fastest pace in five months in June, up 9.2% from June 2003. Foreign currency and gold reserves rose to $89.2 billion, a record. Last week reserves rose $900 million. Facing a creeping banking crisis and the renationalization of companies such as Yukos, the Moscow real estate market could be on the verge of a new downward trend. Growth in prices has ceased for the first time in 12 years and this could be it. Real estate is up seven times higher than bank deposits. ENGLAND Consumer prices climbed 1.6% in June versus one-year ago with a rise of 1.5% in May. The benchmark-lending rate is 4.5%, which should rise to 5.5% by year-end. Retail prices excluding mortgage interest payments, rose 2.3% from a year ago last month the same as May’s gain. Unemployment increased by 6,000 between March and May to 1,432,000. Unemployment remained at 4.8%. Tony Blair based his claim on WMDs in Iraq on the assessment of MI 6, which has since taken the rare step of withdrawing the intelligence assessment that underpinned that claim. The intelligence was unreliable. Why didn’t Mr. Blair tell the public this? That means the whole basis for Blair’s involvement in the invasion of Iraq no longer exists. It could and should mean Blair would resign. We know he previously wanted to resign but his wife, Cheri Blair, insisted he stay on. We reported 1-1/2 years ago he had been paid billions by the Bush faction to go along with the war. Evidently, the money is not Cherie’s motivation, but then again she is an attorney. House price inflation accelerated to 12.2% in May from 10% in April. That shows you how ineffective a 2% rise in interest rates have been. The average price of a home rose to $318,254. Prices increased 1.2% in June. The cost of goods leaving British factories rose at the fastest annual pace in more than eight years in June. UK wages excluding bonuses rose at the fastest pace in two years in the three months through May, indicating accelerating economic growth and the lowest unemployment for three decades may continue to fuel inflation. GERMANY The Bundesbank strongly opposed plans to allow increased access to IMF credit on a precautionary basis, saying it would be highly counterproductive. If the fund took up the role of a general risk insurer, thereby making bailout operations in crisis a general rule, private investor’s risk assessments would be seriously distorted, and debtor countries’ incentives to pursue sound policies and build strong institutions undermined. LATIN AMERICA Venezuelan President Hugo Chavez will visit China in
October to talk about oil as China reaches out for more sources of
supply to feed
its booming economy. Venezuela, Argentina and Brazil have made it quite clear that they will not sign the FTAA agreement due to come into force in 2005. Plans are in the works to establish the International Humanitarian Fund to compete with the IMF. It will be a form of South American independence from control by the US and Europe. A South American satellite TV station is planned as an alternative to the dominance of CNN. Needless to say, the Bush Administration will be trying to block progress in these areas whenever possible. Thus, we predict FTAA will not become reality in 2005. This will be a severe blow to the elitists and will set back their program for a new world order. Seventy-six people have been arrested in Peru in a 24-hour strike against the free market, free trade, and globalized economic policies of President Alejandro Toledo, who is a stooge for internationalist elitist interests. The government had to use 93,000 police officers to quell the 300,000 demonstrators. More than 85% of the population is demanding Toledo resign and a recent poll showed his approval rating to be 7%. Fifty percent of the population lives on $1.25 a day and they are very angry at Toledo’s failure to fulfill his election promises to create more jobs and stamp out poverty. The strike comes as Peru tries to cope with hundreds of visitors to an international soccer event – Copa America – stranded by the grounding of a local airline. We are sure Mr. Toledo will use the Army against protesters, contending it is all the work of Marxists. VHeadline's Elio Cequea responds to US Senator George Allen's serious allegations http://www.vheadline.com/readnews.asp?id=22034MEXICO President Vicente Fox has been a lame duck since he was elected. He has accomplished virtually nothing except sending four million destitute Mexicans into the US to survive. Now, as his PAN party becomes more and more a minority in congress he is dangerously flirting with the idea of having his wife, Marta Sahagun succeed him as president. This would be purely in the fascist mold of Evita Peron. He cannot be re-elected so he will have his wife as a stand-in. That is political suicide for PAN. Two weeks ago, the president’s chief of staff, Alfonso Durazo, resigned due to the ambitions of the first lady. Mexicans do not want to trade the PRI dynasty for a Fox family elitist dynasty. Mexico could be ready for a female president but not one who is dictated to by a sitting president. Then there is the charitable foundation Mrs. Fox created to be a financial base for her run for the presidential nomination. The weak Fox presidency is being further weakened by the “Martela” affair. It negatively affects Mexicans’ move to a real two-party or four-party system throwing power back into the hands of the PRI, which has suffered over the past 10 years. PAN has been weak in recent state elections and if they are any indicator PAN will be in a minority and the PRI in a strong position. If the situation does not change over the next 1-1/2 years and Marta Sahagun remains the front-runner PAN nominee, then no matter who the PRI runs for president, they will win. Aside from that, looking at this objectively Mr. Fox and PAN have not done a good job and are destined to be losers in the next presidential election. The Bank of Mexico has pushed interest rates up three times this year, only to see inflation rise 4.37% June to June. Mexican workers are asking for a 5.1% raise, which will push inflation higher – wage inflation. Mexico town
halts its exodus to U.S. Jul. 17, 2004 12:00 AM IXTLÁN DE JUAREZ, Oaxaca - As Victor Ramirez Hernández slowly maneuvers his pickup through the fog-shrouded switchbacks of this mountainous Zapotec Indian town, he thinks about how so little has changed over time. See story: http://www.azcentral.com/arizonarepublic/ASIA India’s industrial production rose 7.5% in April and May from a year earlier as soaring farm production and the cheapest credit in 30 years spurred consumer spending. Inflation should be 7% this year and corporate tax receipts will rise 40% versus 19% last year. Singapore’s economy grew 9.1% in the second quarter. CHINA Exports surged 47% to a record in June. Sales overseas jumped $51 billion after climbing 33% in May. Imports also jumped to a record $49 billion or 51%. That puts China’s share of trade at 7% almost triple ten years ago. Growth is supposed to slow from 9.1% to 7% this year. If that happens it would trim global growth by 1/2% in 2005 and Asia’s expansion by 1%. Growth in fixed-asset investment, which accounts for half of the Chinese economy, almost halved to 18% in May and M2 money supply had its smallest gain in 1-1/2 years. In the first half, exports rose 36% to $258 billions and imports surged 43% to $265 billion resulting in a $6.82 billion trade deficit. For June alone, China posted a trade surplus of $1.84 billion. China has emerged as the power broker in Asia and its influence is rapidly rising and America’s is rapidly declining. While this realization may be unpleasant for Washington, the sooner administration officials accept this reality the faster they can deal with it. Unfortunately, they have virtually ignored East Asia, preoccupied as they are with Afghanistan and Iraq. Within six years, China’s economy will be double that of Germany making it the world’s third largest economy. By 2020, it is expected to surpass Japan in second place. Japan now imports more from China than it does from the US. Growth no longer comes out of the barrel of a gun and it comes from trade and slave’s wages. China’s role in solving of the North Korean crisis shows it is a power now to be reckoned with. The Bush neocons have vacated the region and left a power vacuum to be filled and that is what China has done. We cannot believe this is anything but deliberate. We simply abdicated our leadership position in Asia. China
drew 12% more direct foreign investment in the first half rising to $34
billion after gaining 7.5% in the first quarter. M2 was up 16.2% year-to-year,
its slowest increase in 18 months. Foreign exchange reserves were up 35.8%
year-to-year. China is slowing down. Lack of coal and electricity has assisted the government in slowing economic growth. As we reported earlier, the Chinese now have a trade deficit and it is widening. In fact, it is the worst in 17 years. GDP rose 9.6% from a year earlier after climbing 9.8% in the first quarter. Consumer prices fell l0.7% in May. In the first half of the year, fixed-asset investment increased 29%; overall, that is off from 43% in the first quarter. Real estate investment rose 29% after rising 31% in the first quarter. Last month M2 fell for the first time in 1-1/2 years as industrial production and car sales had their smallest gain in two years. Imports rose 50% as retail sales rose 14%. Employment held at a 23-year low of 4.3%. Inflation was 3.6% in the first half, driven by a 9.5% gain in food prices. JAPAN The government is reforming its government bond insurance by recruiting banks to be designated as primary dealers. They want dealers to commit in advance to buy 3% or more of an auction, which tells us the government is having trouble flogging its paper. We would think so as combined central and local debt reaches $6.6 trillion or 144% of GDP. As interest rates rise and old debt is rolled for new, the cost of carrying that debt rises. School authorities in Osaka have
decided the benefits of RFID chips outweigh the disadvantages and will
now be chipping children in one primary school.
The tags will be read by readers in school gates and other key locations
to track
the children’s every movement. The chips will go into school bags and
nametags on clothing. AUSTRALIA AND NEW ZEALAND The US-Australia Free Trade Agreement before the Senate here since 2003, having been introduced by Sen. Larry Craig (R-ID), is now almost certain to pass. These conservative politicians just do not get it. Free trade is a disaster for America. Rep. Con Sherwood (R-PA) submitted the House version, and it too is assured of passage. The Senate has recommended that the agreement include the requirement that Congress approve any future decisions by the US Trade Representative to waive any tariffs on Australian beef exports to the US if they surpass limits that the Congress might set in the future. Of course, as usual, the benefits of the agreement will be heavily weighted in favor of Australia, but what else would you expect. The benefits to Australia will grow large in years to come. Australia is sending 30 more Army personnel to Iraq bringing their total commitment to 880. The US dairy industry is calling for an end to NZ export subsidies not only for New Zealand, but also for Australia and South America. They will discuss the matter in Geneva this month. The NZ CPI rose 0.8% in the June quarter, the steepest increase in 2-1/2 years, pushing the annual rate to 2.4%. Construction costs are the culprit, rising 1.9% in the quarter and 8.8% over the year. Overall, construction costs are up 80%. Real estate agents’ fees rose 4.4% or 21.4% annualized. Rents were up 0.4% or 3.2% for the year. Oil prices were up 7.8% and up 19% from a year ago. We expect on July 29, 2004, there will be a further increase in interest rates from 5.75% to 6% and the Reserve Bank just might bump them up a little more because inflation of 3% before the end of the year is a foregone conclusion. New Zealand’s PM, Helen Clark, made a scathing attack on Israel and imposed tough diplomatic sanctions after two Mossad spies were jailed for passport fraud. The act carried out by the Israeli intelligence agents was not only unacceptable, but also a breach of NZ sovereignty and international law. All Israelis coming to NZ on government business must now obtain visas. Foreign Ministry consultations with Israel have been suspended and the government has declined an approach by Israel’s head of state. AFRICA After 60 years of independent rule, half of Africa cannot feed itself. This is the result of an ongoing, relentless ethnic-cleansing campaign. Democracy as the western elitists call it has led to poor land management and the over-population policies of a long-line of power-hungry, self-serving African dictators, which has brought the continent to the edge of disaster. All you have to do is throw HIV/AIDS into this evil potion and you surely have disaster. These countries with democratic dictators have driven out all of the efficient food-producing ethno-Euro farmers, and the western nations had done nothing to retard this process. That tells us they want Africa depopulated. Just look at the situation in Zimbabwe. It says it all. Educated Africans are fleeing this chaos because they know what is going to happen. They are streaming into Europe, where they are demanding to be housed, fed educated and given equal legal treatment, while European nations tolerate and financially support Africa’s ethnic-cleansing campaign. Zimbabwe and Namibia are being depopulated of whites and Mbeki of South Africa has passed laws called “black economic empowerment,” which blocks whites from accessing the job market and has affectively removed their private-land ownership. He is changing all Afrikaner names on the South African map, closing cultural and educational institutions and Afrikaans- language radio stations. After being in the country for as longs as blacks, some 350 years, they have no place to flee too. The world cannot continue to give Africa four million tons of wheat a year, especially if we have a depression. There are only 45,000 Afrikaner farmers left in South Africa; over a thousand have already been murdered. They are battling heavily armed groups of youth militias targeting their homesteads. Just 10 years ago there were 85,000 white farmers employing over one million people. That is history. There are less than 100 Zimbabwe farmers left. No matter how you cut it, it's game over. AIDS is now pandemic in Africa where infants born
in the nations with the seven highest rates of disease are expected to
live less than 40 years. In South Africa,
life expectancy fell from 57 in 1995 to 55 in 2000 and the future looks
catastrophic. HEALTH " Algae and Seaweed for good Health" our cell chemistry mimics the ocean. Your body fluids
mimic the salt and mineral content found in the ocean. If you don’t
replenish these nutrients your cells will explode, maybe not all at
once, but eventually a system collapse
happens. Celtic Sea salt is one way
to give the body the resources it needs to keep cell walls strong, clear
out plaque, balance blood pressure (no hypertension
with
organic, whole salt), improve digestion and extract more protein from food.
The other “super foods” are blue green algae and seaweed. Seaweed helps our bodied maintain the correct alkaline
balance in our blood. When this is in balance, our bodies can resist stress
and fatigue better. The
blue-green algae is a single-cell plant source of vitamin B to handle stress
and strengthen the gland and immune systems. There are many different kinds of seaweed. Dulse, Kelp, Alaria and Nori. Alaria and Nori are similar to wakame and are a standard sea vegetable for soups. Kelp is harvested in the cold months of spring and is of the oldest family of seaweed on earth. Kelp is easy to cook with other vegetables and try roasting it and eating like popcorn. Dulse is the most popular of the seaweed and has a sweeter taste. It is a known fact that those who consume seaweed have a healthier immune system and is able to fend off 90% of bacteria and viruses. How? Keeping your bloodstream supplied with natural, whole minerals (as found in seaweed) will dehydrate any bacteria or viruses. Seaweed and your thyroid Thyroid disease is on the rise in America. One in
ten adults are affected (especially women) due to a lack of natural iodine.
Many of the products we consume will
displace natural iodine in our bodies. Avoid foods, beverages and cosmetics
with flourine/fluoride in them. Fluoride is a mind-altering drug to make
us more docile.
Use calcium and magnesium rich plant foods for your calcium intake to protect
your teeth and bones. Animal calcium is an inferior source of calcium and
the body can't metabolize it as well as plant calcium. The Celtic Sea salt
also has
natural iodine. I am extremely cautious about what I put into my body. Food is your medicine and you don't want substandard foods. I’m the watchdog for your health and sometimes I’m anal retentive when it comes to picking quality herbs and foods. I don't want seaweed or blue-green algae that has been floating about in an oil slick or harvested by people in motor boats with engine oil leaking all over my stuff. Finding conscientious people who share your vigilance is darn hard. Sometimes it can take months or years to find the right source. When you do find them, you hang onto their business card like it's the ripcord on your parachute. I had to leave the main land and go to Hawaii to find quality blue-green algae. The pristine Hawaiian Islands with the volcanic soil provides the perfect environment for unadulterated blue-green algae. I import this stuff by the kilo to include as a super food, vitamin B source in my Body Foundation Food Mix. I include the sweet dulse seaweed also to give your immune and gland system the fortification necessary to fight our modern plagues. Well, there you have it. Who knew seaweed and algae could be so darn helpful. Instead of Prozac for stress and depression - take some seaweed. You'll handle that stress a lot better and your immune system will fend off the bacteria your coworker is hacking all over the place in the cubicle next to yours. My web site http://www.thepowerherbs.com 866-229-3663. We also carry the Celtic Sea salt, imported from France where they still harvest the correct way. SUBSCRIPTION and RENEWAL INFORMATION: 1-YEAR $99.95 U. S. Funds. Make check payable to Robert Chapman (NOT International Forecaster), and mail to P.O. Box 510518, Punta Gorda, FL 33951. Please include name, address, telephone number and e-mail address. We accept Visa and MasterCard charges. Provide us with your card number and expiration date. We will charge your card $99.95 for a one-year subscription. Note: We publish twice a month by surface mail or 3-4 times a month by E-mail. Correspondence to Bob Chapman international_forecaster@yahoo.com, or for subscription information IF_distctr@yahoo.com. Foreigners please use foreign U.S. dollar denominated checks or Money Orders. |